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                                                                    EXHIBIT 10.1

[Portions  herein  identified by *** have been omitted pursuant to a request for
confidential  treatment  and have  been  filed  separately  with the  Commission
pursuant to Rule 24b-2 of the Secureities Exchange Act of 1934, as amended.]

                        LICENSE AND DEVELOPMENT AGREEMENT

                  THIS LICENSE AND  DEVELOPMENT  AGREEMENT  (this  "Agreement"),
effective  as of April 4, 2003 (the  "Effective  Date"),  is entered into by and
between NOVADEL PHARMA INC., a Delaware corporation  ("NovaDel"),  and MANHATTAN
PHARMACEUTICALS,  INC., a Delaware  corporation  (the  "Licensee").  NovaDel and
Licensee  each  may  be  referred  to  herein  individually  as  a  "Party,"  or
collectively as the "Parties."

                  WHEREAS,   NovaDel   has   certain   proprietary   rights  and
intellectual  property  (including  to certain  patents) with respect to lingual
sprays for the metered delivery of pharmaceutical  products (the  "Technology");
and

                  WHEREAS,  Licensee desires to obtain from NovaDel, and NovaDel
desires  to  grant to  Licensee,  a  license  to  develop  and  commercialize  a
pharmaceutical  product  containing  propofol as active  ingredient that will be
administered  using the Technology on the terms and conditions set forth herein;
and

                  WHEREAS,  Licensee desires that NovaDel  provide,  and NovaDel
desires to  provide,  certain  services  in respect of the  development  of such
pharmaceutical product containing propofol as active ingredient on the terms and
conditions set forth herein.

                  NOW,  THEREFORE,  in consideration of the foregoing  premises,
the mutual  promises and covenants of the Parties  contained  herein,  and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties hereto, intending to be legally bound, do hereby agree
as follows:

                                    ARTICLE 1
                                   DEFINITIONS

                  For the purposes of this  Agreement,  the following  words and
phrases  shall  have  the  following  meanings,  unless  otherwise  specifically
provided herein:

                  1.1 "AFFILIATE"  shall mean,  with respect to any Entity,  any
other Entity that  directly or  indirectly  through one or more  intermediaries,
controls,  is  controlled  by or is under common  control with such Entity.  For
purposes of this Section 1.1 only, "control" and, with correlative meanings, the
terms  "controlled  by" and  "under  common  control  with"  shall  mean (a) the
possession,  directly or  indirectly,  of the power to direct the  management or
policies of an Entity,  whether through the ownership of voting  securities,  by
contract or otherwise, or (b) the ownership, directly or indirectly, of at least
fifty percent (50%) of the voting  securities or other ownership  interest of an
Entity.

                  1.2 "APPLICABLE  LAW" shall mean the applicable  laws,  rules,
regulations,  guidelines and requirements of the Regulatory Authorities,  in the
Territory.

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                  1.3   "COMBINATION   PRODUCT"   shall   mean   a   combination
pharmaceutical product containing one or more therapeutically active ingredients
in addition to a Designated Compound.

                  1.4 "COMMERCIALLY REASONABLE EFFORTS" shall mean, with respect
to the  development  or  commercialization  of a Licensed  Product,  efforts and
resources  commonly  used in the  research-based  pharmaceutical  industry for a
product of similar  commercial  potential at a similar  stage in its  lifecycle,
taking into  consideration  its safety and  efficacy,  its cost to develop,  the
competitiveness  of  alternative  products,   its  proprietary   position,   the
likelihood of regulatory  approval,  its  profitability,  and all other relevant
factors.   Commercially   Reasonable   Efforts   shall   be   determined   on  a
market-by-market   basis  for  each  Licensed  Product  without  regard  to  the
particular  circumstances of a Party,  including any other product opportunities
of such Party.

                  1.5  "CONFIDENTIAL  INFORMATION"  shall have the  meaning  set
forth in Article 15.

                  1.6  "CONTROL"  shall  mean,  with  respect  to  any  item  of
Information  and  Inventions,  Patents  or other  intellectual  property  right,
possession  of the  ability,  whether  directly  or  indirectly,  and whether by
ownership,  license or otherwise,  to assign, or grant a license,  sublicense or
other  right to or under,  such  item,  Patent or right as  provided  for herein
without violating the terms of any agreement or other arrangement with any Third
Party.

                  1.7 "DESIGNATED COMPOUND" shall mean initially, propofol.

                  1.8  "DEVELOPMENT   ACTIVITIES"   shall  mean  the  activities
performed by the Parties under the Development Plan pursuant to Article 3.

                  1.9  "DEVELOPMENT  BUDGET" shall have the meaning set forth in
Section 3.3.

                  1.10 "DEVELOPMENT  COMMITTEE" shall have the meaning set forth
in Section 3.4.1.

                  1.11  "DEVELOPMENT  PLAN"  shall have the meaning set forth in
Section 3.3.

                  1.12 "EFFECTIVE  DATE" shall have the meaning set forth in the
preamble.

                  1.13 "ENTITY" shall mean any individual,  sole proprietorship,
corporation, limited liability company, association, joint venture, partnership,
limited partnership, limited liability partnership, trust, university, business,
government or political  subdivision thereof,  including an agency, or any other
organization that possesses independent legal standing.

                  1.14 "EXPLOIT"  shall mean to make,  have made,  import,  use,
sell,  or offer for sale,  including to  research,  develop,  register,  modify,
improve,  manufacture,  have manufactured,  store, have used, export, transport,
distribute,  promote,  market or have sold or  otherwise  dispose  of a licensed
product or process.

                  1.15  "EXPLOITATION"  shall  mean  the  making,  having  made,
importation,  use,  sale,  offering  for sale of a licensed  product or process,
including the research, development,

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registration,  modification,  improvement,  manufacture,  storage, optimization,
import, export,  transport,  distribution,  promotion,  marketing, sale or other
disposition of a licensed product or process.

                  1.16  "FDA"  shall  mean  the  United  States  Food  and  Drug
Administration,  or any successor  agency  responsible  for the  evaluation  and
approval of pharmaceutical products.

                  1.17 "FIRST COMMERCIAL SALE" shall mean the first sale for use
or consumption by the general public of the Licensed  Product in a country after
Regulatory  Approval   (including  pricing  and  reimbursement   approval  where
applicable) for the marketing and sale of the Licensed Product has been obtained
in such country.

                  1.18 "IMPROVEMENT"  shall mean any modification,  variation or
revision to an  apparatus,  method,  product or  technology,  or any  discovery,
technology,  device,  process or  formulation  related to an apparatus,  method,
product or  technology,  whether or not patented or  patentable,  including  any
enhancement  in the  manufacture  or steps or  processes  thereof,  ingredients,
preparation,  presentation,  formulation, means of delivery, packaging or dosage
of an apparatus,  method, product or technology, any discovery or development of
any new or expanded indications for an apparatus, method, product or technology,
or any discovery or development that improves the stability,  safety or efficacy
of an apparatus, method, product or technology.

                  1.19 "IND" shall mean an investigational  new drug application
filed with the FDA for  approval  to commence  human  clinical  trials,  and its
equivalent in other countries or regulatory jurisdictions in the Territory.

                  1.20 "INDEMNIFICATION CLAIM NOTICE" shall have the meaning set
forth in Section 10.3.1.

                  1.21  "INDEMNIFIED  PARTY" shall have the meaning set forth in
Section 10.3.1.

                  1.22  "INFRINGEMENT  SUIT" shall have the meaning set forth in
Section 6.8.2.

                  1.23  "INFORMATION  AND INVENTIONS"  shall mean all technical,
scientific  and  other  know-how  and  information,  trade  secrets,  knowledge,
technology,  means,  methods,  processes,  practices,  formulas,   instructions,
skills,  techniques,  procedures,   experiences,  ideas,  technical  assistance,
designs,  drawings,   assembly  procedures,   computer  programs,   apparatuses,
specifications,  data,  results and other material,  including  pre-clinical and
clinical  trial  results,  manufacturing  procedures  and  test  procedures  and
techniques, (whether or not confidential,  proprietary,  patented or patentable)
in written,  electronic or any other form now known or hereafter developed,  and
all Improvements,  whether to the foregoing or otherwise, and other discoveries,
developments,  inventions,  and  other  intellectual  property  (whether  or not
confidential, proprietary, patented or patentable).

                  1.24  "KNOWLEDGE"  shall mean the good faith  understanding of
the  vice  presidents,  senior  vice  presidents,   executive  vice  presidents,
president or chief  executive  officer of the respective  party of the facts and
information  then  in  their   possession   without  any  duty  to  conduct  any
investigation with respect to such facts and information.

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                  1.25  "LICENSED  PROCESS" shall mean the  proprietary  lingual
spray  technology  for the  delivery  of  pharmaceutical  compounds  through the
mucosal  membrane  of the mouth  using an aerosol or pump spray  device  that is
under the  Control  of  NovaDel as of the  Effective  Date and any  Improvements
thereto that are  conceived  and reduced to practice by NovaDel in the course of
performing the Development Activities.

                  1.26   "LICENSED   PRODUCT(S)"   shall   mean  any  dosage  of
pharmaceutical  composition or preparation in finished form labeled and packaged
for  sale by  prescription,  over-the-counter  or any  other  method  for  human
applications that contains propofol delivered by means of the Licensed Process.

                  1.27 "LICENSED TECHNOLOGY" shall mean the NovaDel Patents, the
NovaDel Know-How and the Drug Master File,  collectively,  but only with respect
to the Exploitation of the Licensed Product.

                  1.28  "LICENSED  TRADEMARK"  shall mean those  Trademarks  set
forth  on  Exhibit  A  attached  hereto  and  such  other  Trademarks  as may be
designated by NovaDel in writing from time to time, and any registrations of the
foregoing and pending applications relating thereto.

                  1.29 "LICENSEE" shall mean Manhattan Pharmaceuticals,  Inc., a
Delaware corporation.

                  1.30  "LOSSES"  shall  have the  meaning  set forth in Section
10.1.

                  1.31 "MAJOR  MARKET  COUNTRY"  shall mean the United States of
America and the European Union.

                  1.32 "NDA" shall mean a New Drug Application filed pursuant to
the requirements of the FDA, as more fully defined in 21 C.F.R.ss.314.5 et seq.,
and any  equivalent  application  required by any  Regulatory  Authority for the
marketing, sale or use of the Licensed Product in the Territory.

                  1.33 "NET PROFITS" shall mean for any period, the gross amount
invoiced  by Licensee  and its  Affiliates  for the sale of Licensed  Product by
Licensee or any of its Affiliates to Third  Parties,  less  deductions  for: (a)
normal and customary  trade,  quantity and cash  discounts and sales returns and
allowances, including (i) those granted on account of price adjustments, billing
errors,  rejected goods, damaged goods, returns and rebates, (ii) administrative
and other fees and  reimbursements and similar payments to wholesalers and other
distributors,  buying groups, pharmacy benefit management organizations,  health
care insurance carriers and other  institutions,  (iii) allowances,  rebates and
fees paid to distributors and (iv) chargebacks;  (b) freight,  postage, shipping
and  insurance  expenses to the extent that such items are included in the gross
amount  invoiced;  (c) customs and excise duties and other duties related to the
sales to the extent that such items are included in the gross  amount  invoiced;
(d)  rebates  and similar  payments  made with  respect to sales paid for by any
governmental or regulatory  authority such as, by way of illustration and not in
limitation of the Parties' rights hereunder, Federal or state Medicaid, Medicare
or similar state program or equivalent foreign  governmental  program; (e) sales
and other  taxes and  duties  directly  related to the sale or  delivery  of the
Licensed  Product (but not including  taxes assessed  against the income derived
from such  sale);  (f)  distribution

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expenses  to the  extent  that such  items  are  included  in the  gross  amount
invoiced;  (g) any other similar and customary  deductions  that are  consistent
with United States generally accepted accounting  principles,  or in the case of
non-United States sales, other applicable  accounting  standards;  (h) insurance
costs; (i) employee salaries and other consultant and employee compensation; (j)
research and development  costs;  (k)  manufacturing  costs;  (l) sales expenses
(including  sales  commissions);  (m)  storage  of  Licensed  Product;  and  (n)
royalties  payable to third  parties.  Any of the  deductions  listed above that
involves a payment by Licensee or its  Affiliates  shall be taken as a deduction
in the  calendar  quarter in which the payment is accrued by such  eentity.  For
purposes of determining Net Sales, a Licensed Product shall be deemed to be sold
when invoiced and a "sale" shall not include transfers, uses or dispositions for
charitable,  promotional,  pre-clinical,  clinical,  regulatory or  governmental
purposes.  For  purposes of  calculating  Net  Profits,  sales  between or among
Licensee  or its  Affiliates  shall  be  excluded  from the  computation  of Net
Profits,  but sales by  Licensee or its  Affiliates  to Third  Parties  shall be
included in the computation of Net Profits.

                  1.34 "NET SALES" shall mean, for any period,  the gross amount
invoiced  by Licensee  and its  Affiliates  for the sale of Licensed  Product by
Licensee  or any  of its  Affiliates  to  Third  Parties,  less  deductions  for
chargebacks,  billing errors,  rejected goods, damaged goods and returns. Any of
the  deductions  listed  above  that  involves  a  payment  by  Licensee  or its
Affiliates  shall be taken as a deduction in the  calendar  quarter in which the
payment is accrued by such entity.  For  purposes of  determining  Net Sales,  a
Licensed Product shall be deemed to be sold when invoiced and a "sale" shall not
include transfers, uses or dispositions for promotional, pre-clinical, clinical,
regulatory or  governmental  purposes.  For purposes of  calculating  Net Sales,
sales  between or among  Licensee or its  Affiliates  shall be excluded from the
computation  of Net Sales,  but sales by  Licensee  or its  Affiliates  to Third
Parties shall be included in the computation of Net Sales.

                  1.35  "NOVADEL"  shall  have  the  meaning  set  forth  in the
preamble.

                  1.36  "NOVADEL   KNOW-HOW"  shall  mean  all  Information  and
Inventions  Controlled by NovaDel or an Affiliate of NovaDel as of the Effective
Date or, from time to time,  during the Term that (a) (i) are  necessary for the
use of the Licensed  Process to Exploit the  Licensed  Product or (ii) relate to
Improvements to the Licensed  Product that are conceived and reduced to practice
in the  course  of  performing  the  Development  Activities,  and  (b)  are not
generally  known,  but excluding any  Information  and  Inventions to the extent
claimed by any NovaDel Patents.

                  1.37  "NOVADEL  PATENTS"  shall mean the Patents  that NovaDel
Controls  (a) as of the  Effective  Date that are listed on Exhibit A hereto and
(b) from time to time during the Term that claim (i) the  Licensed  Process,  or
(b) any  Improvements to the Licensed  Product that are conceived and reduced to
practice in the course of performing the Development Activities.

                  1.38   "PATENTS"   shall  mean  (a)  all  patents  and  patent
applications;     (b)    any    substitutions,     divisions,     continuations,
continuations-in-part,   reissues,   renewals,   registrations,   confirmations,
re-examinations, extensions, supplementary protection certificates and the like,
and any provisional  applications,  of any such patents or patent  applications;
and (c) any international equivalent of any of the foregoing.

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                  1.39  "REGULATORY  APPROVAL"  shall mean any and all approvals
(including  pricing and  reimbursement  approvals),  licenses,  registrations or
authorizations  of any Regulatory  Authority,  necessary for the Exploitation of
the Licensed  Product in a country in the Territory,  including (a) any approval
of any Licensed Product (including any INDs, NDAs, and supplements or amendments
thereto);  (b) pre- and post-approval  marketing  authorizations  for a Licensed
Product  (including any  prerequisite  manufacturing  approval or  authorization
related  thereto);  (c)  labeling  approval  for a  Licensed  Product;  and  (d)
technical, medical and scientific licenses.

                  1.40   "REGULATORY   AUTHORITY"   shall  mean  any  applicable
supra-national,   federal,  national,   regional,  state,  provincial  or  local
regulatory  agencies,  departments,  bureaus,  commissions,  councils  or  other
government entities regulating or otherwise exercising authority with respect to
the Licensed Technology or the Licensed Product in the Territory.

                  1.41 "REGULATORY  DOCUMENTATION"  shall mean all applications,
registrations,  licenses, authorizations and approvals (including all Regulatory
Approvals),   all  correspondence  submitted  to  or  received  from  Regulatory
Authorities  (including  minutes and official  contact  reports  relating to any
communications with any Regulatory Authority),  all supporting documents and all
clinical  studies and tests,  relating  to any  Licensed  Product,  and all data
contained  in  any  of the  foregoing,  including  all  regulatory  drug  lists,
advertising and promotion documents, adverse event files and complaint files.

                  1.42 "SECONDARY  MARKET  COUNTRIES" shall mean Japan,  Canada,
Australia and South Africa.

                  1.43  "SUBLICENSEE"  shall  mean  any  Third  Party  to  which
Licensee grants a sublicense  pursuant to Section 2.5 under the licenses granted
to Licensee by NovaDel under Section 2.1.

                  1.44   "SUBLICENSING   FEES"   shall   mean  all   non-royalty
consideration  of any kind,  including any fees,  milestones  or other  payments
(whether  cash or  non-cash  (which  shall be  valued  at fair  market  value)),
received by Licensee or any of its Affiliates  from any  Sublicensee as a direct
or  indirect  result of the grant by Licensee  or any of its  Affiliates  to any
Sublicensee of a license under,  or the use by any such  Sublicensee  of, any of
the Licensed Technology or Licensed Trademarks,  in excess of the payments to be
paid pursuant to sections 4.4 and 4.5.

                  1.45  "TECHNOLOGY"  shall  have the  meaning  set forth in the
preamble.

                  1.46 "TERM" shall have the meaning set forth in Section 7.1.

                  1.47 "TERRITORY" shall mean the entire world.

                  1.48 "THIRD  PARTY" shall mean any Entity other than  NovaDel,
Licensee and their respective Affiliates.

                  1.49 "THIRD  PARTY  CLAIM" shall have the meaning set forth in
Section 10.3.2.

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                  1.50 "TRADEMARK" shall include any word, name, symbol,  color,
designation or device or any combination thereof, including any trademark, trade
dress, brand mark, trade name, brand name, logo or business symbol.

                  1.51 "VALID  CLAIM"  shall mean,  with respect to a particular
country,  a claim of a Patent in such  country  that (a) has not been revoked or
held unenforceable or invalid by a decision of a court or governmental agency of
competent  jurisdiction  from  which no  appeal  can be taken or has been  taken
within the time allowed for appeal, and (b) has not been abandoned,  disclaimed,
denied or admitted to be invalid or unenforceable  through reissue or disclaimer
or otherwise in such country.

                                    ARTICLE 2
                                 GRANT OF RIGHTS

                  2.1 LICENSE GRANTS TO LICENSEE.

                       2.1.1  Subject  to  Section  2.3 and the other  terms and
conditions  of this  Agreement,  NovaDel  hereby grants to Licensee and Licensee
accepts,  a non-transferable  (except as provided in Article 12),  sublicensable
(only as provided in Section 2.5), royalty-bearing,  worldwide,  exclusive right
and license under the Licensed Technology to Exploit the Licensed Product in the
Territory,  to the full end of the Term for which  the  Licensed  Technology  is
licensed, unless sooner terminated as herein after provided.

                       2.1.2  Subject  to  Section  2.3 and the other  terms and
conditions  of this  Agreement,  NovaDel  hereby grants to Licensee and Licensee
accepts,  a non-transferable  (except as provided in Article 13),  sublicensable
(only as  provided in Section  2.4),  royalty-bearing,  non-exclusive  right and
license  under  the  Licensed  Trademarks  for the sole  purpose  of using  such
Licensed Trademarks to market, distribute and sell the Licensed Product licensed
under Section 2.1.1 in the Territory,  to the full end of the Term for which the
Licensed Product are licensed, unless sooner terminated as hereinafter provided.

                  2.2  LICENSE  GRANT TO  NOVADEL.  Licensee  hereby  grants  to
NovaDel  a  limited,  royalty-free,  non-exclusive  right  and  license  in  the
Territory in and to the Licensed  Technology to the extent  necessary to perform
its Development Activities under Article 3.

                  2.3  RETAINED  RIGHTS.  NovaDel  retains all right,  title and
interest,  including the right to grant licenses to Third Parties, in and to the
Licensed Technology (other than for delivery of the Designated Compounds only as
expressly provided in Section 2.1.1) and the Licensed Trademarks (other than for
the  Exploitation  of Licensed  Product  only as  expressly  provided in Section
2.1.2).  Licensee shall have no rights,  express or implied, with respect to the
Licensed Technology or the Licensed Trademarks, except as expressly set forth in
Section  2.1, and  Licensee  covenants  to NovaDel  that none of  Licensee,  its
Affiliates  or  Sublicensees  shall use the  Licensed  Technology,  directly  or
indirectly,  for any purpose  other than for  administration  of the  Designated
Compounds  in  connection  with the  Exploitation  of Licensed  Product,  or the
Licensed  Trademarks,  directly or  indirectly,  for any purpose  other than the
marketing,  distribution and sale of Licensed Product hereunder.  Licensee shall
have  no  right  to  develop   Combination   Product   under   this   Agreement.
Notwithstanding anything in this Agreement to the

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contrary,  NovaDel does hereby retain the right to (a) enter into collaborations
or other  agreements  with,  and to grant  licenses  and other  rights under the
NovaDel  Patents  and  NovaDel  Know-How  to Third  Parties to Exploit  products
containing compounds other than the Designated Compounds and to use the Licensed
Process  in  connection  therewith,   and  (b)  independently  Exploit  products
containing compounds other than the Designated Compounds and to use the Licensed
Process in connection  therewith.  Notwithstanding any other provision contained
in this Agreement, NovaDel retains an irrevocable,  non-exclusive,  royalty-free
right to use the  Licensed  Technology  (including  the Licensed  Process)  with
respect to the Designated Compounds,  for its internal,  non-commercial research
and development activities.

                  2.4  SUBLICENSES.  Licensee  shall  have  the  right  to grant
sublicenses  under the  grants in Section  2.1 to Third  Parties  pursuant  to a
separate  written   agreement,   subject  to  the  following   requirements  and
conditions:

                       2.4.1  Licensee  must  obtain   NovaDel's  prior  written
consent in respect of each such sublicense,  such consent not to be unreasonably
withheld,  and any sublicense  agreement must be fully consistent with the terms
and conditions of this Agreement,  including Articles 3.10, 5, 6, 10, 11, 13 and
16, and provide that  Sublicensee  will indemnify  NovaDel and its Affiliates to
the extent provided in Article 10.

                       2.4.2  Within  five (5) days after  execution  or receipt
thereof, as applicable,  Licensee shall provide NovaDel with a full and complete
copy of each sublicense granted here

                       2.4.3  .under  and shall  deliver  copies of all  reports
(including  relating to royalties and other payments)  received by Licensee from
such Sublicensees.

                       2.4.4  Termination of this Agreement by NovaDel  pursuant
to Section  8.3 with  respect to Licensee  shall not  terminate  any  sublicense
granted by Licensee  pursuant to this Section 2.5 with respect to a Sublicensee,
provided  that (a) such  Sublicensee  is not in breach of any  provision of this
Agreement or the applicable  sublicense  agreement,  (b) such Sublicensee  shall
perform all obligations of Licensee under this Agreement, (c) NovaDel shall have
all rights with respect to any and all  Sublicensees  as it had  hereunder  with
respect to Licensee  prior to  termination  of this  Agreement  with  respect to
Licensee, (d) Licensee shall include in any sublicense a provision in which said
Sublicensee  acknowledges its obligations to NovaDel hereunder and the rights of
NovaDel to terminate this Agreement with respect to any Sublicensee for breaches
of this Agreement by such  Sublicensee.  The failure of Licensee to include in a
sublicense  the  provisions  referenced  in clause (d) shall render the affected
sublicense void ab initio.

                                   ARTICLE 3
                  DEVELOPMENT AND COMMERCIALIZATION ACTIVITIES

                  3.1 DEVELOPMENT AND COMMERCIALIZATION. Licensee shall have the
sole right and obligation to develop and  commercialize  the Licensed Product in
the  Territory.  NovaDel shall  perform or cause to be  performed,  on behalf of
Licensee,  certain  Development  Activities in  accordance  with this Article 3.
Except as set forth herein,  Licensee shall be solely  responsible

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for  all  costs  and   expenses  in   connection   with  all   development   and
commercialization activities,  including the Development Activities performed by
NovaDel on behalf of Licensee.

                  3.2 DEVELOPMENT  ACTIVITIES.  NovaDel shall not be required to
commence any Development Activities until Licensee has paid at least twenty-five
percent (25%) of the non-refundable License Fee described in Section 4.4.

                       3.2.1 GENERAL. Under the direction and supervision of the
Development  Committee,  NovaDel and Licensee each shall perform, or cause to be
performed,   its  respective  Development  Activities  in  accordance  with  the
Development  Plan and Development  Budget.  Notwithstanding  the foregoing,  the
Parties  acknowledge  and  agree  that  there  can  be no  assurances  that  the
objectives of the  Development  Activities can be achieved,  or that they can be
achieved  in the  manner  or in the time  set  forth  in the  Development  Plan.
Although  outcomes  cannot be  guaranteed,  each  Party  shall use  Commercially
Reasonable   Efforts  to  perform  or  cause  to  be  performed  its  respective
Development  Activities in good scientific  manner,  and in material  compliance
with Applicable Law.

                       3.2.2  REPORTS.  Within thirty (30) days after the end of
each calendar quarter in which Development Activities are performed,  each Party
shall provide to the  Development  Committee a written  progress  report,  which
shall  describe the  Development  Activities  it has  performed,  or cause to be
performed, during such calendar quarter, evaluate the work performed in relation
to the goals of the Development Plan and in relation to the Development  Budget,
and provide such other information as may be required by the Development Plan or
reasonably   requested  by  the  Development   Committee  with  respect  to  the
Development Activities.

                  3.3 DEVELOPMENT  PLAN AND BUDGET.  The  development  plan (the
"Development  Plan") and the development  budget (the "Development  Budget") for
the Development Activities relating to propofol are attached hereto as Exhibit B
and  Exhibit  C,  respectively.  The  Development  Committee  shall  review  the
Development  Plans and the  Development  Budgets at least monthly and shall have
the right to make such  modifications  or  updates to the  Development  Plans or
Development Budgets that it deems appropriate. The Parties acknowledge and agree
that the amounts set forth in the  Development  Budgets are estimates and, given
the unpredictability of the Development  Activities,  there can be no assurances
that the Development Activities can be completed within the Development Budgets,
provided,  however, that the Parties agree to use their Commercially  Reasonable
Efforts to adhere to the Development Budgets.

                  3.4 DEVELOPMENT COMMITTEE.

                       3.4.1  FORMATION AND AUTHORITY OF DEVELOPMENT  COMMITTEE.
NovaDel and Licensee shall establish a development  committee (the  "Development
Committee"),  which shall oversee the  Development  Activities  performed by the
Parties,  review and approve the  Development  Budget and approve any changes to
the Development Plan and Development  Budget.  Each Party shall appoint an equal
number of representatives  with the requisite experience and seniority to enable
them to make decisions on behalf of the Parties with

                                     Page 9
<PAGE>

respect  to the  Development  Activities.  From  time to time,  each  Party  may
substitute its representatives on written notice to the other Party.

                       3.4.2  PROCEDURAL  RULES OF  DEVELOPMENT  COMMITTEE.  The
Development  Committee  shall meet  monthly,  or as  otherwise  agreed to by the
Parties.  The Development  Committee shall adopt such standing rules as shall be
necessary  for its  work.  A quorum of the  Development  Committee  shall  exist
whenever there is present at a meeting at least one representative  appointed by
each Party. Members of the Development  Committee may attend a meeting either in
person  or by  telephone,  video  conference  or  similar  means in  which  each
participant can hear what is said by the other  participants.  Representation by
proxy  shall not be  allowed.  The  Development  Committee  shall take action by
unanimous consent of NovaDel and Licensee,  with each such Party having a single
vote, irrespective of the number of representatives  actually in attendance at a
meeting, or by a written resolution signed by the designated  representatives of
each of NovaDel and Licensee.

                       3.4.3 DISPUTE  RESOLUTION.  If the Development  Committee
cannot,  or does not, reach agreement on an issue,  then either Party shall have
the right to refer such issue to the Chief Executive Officers of the Parties who
shall confer on the resolution of the issue. Any final decision  mutually agreed
to by the Chief Executive  Officers of the Parties shall be in writing and shall
be conclusive and binding on the Parties. If such officers are not able to agree
on the resolution of an issue within twenty (20) days after such issue was first
referred to them,  either  Party  shall have the right to refer such  dispute to
arbitration pursuant to Article 9.

                       3.4.4 LIMITATIONS ON AUTHORITY OF DEVELOPMENT  COMMITTEE.
Each Party to this  Agreement  shall retain the rights,  powers,  and discretion
granted to it under this Agreement,  and no such rights,  powers,  or discretion
shall be  delegated  to or  vested  in the  Development  Committee  unless  such
delegation or vesting of rights is expressly  provided for in this  Agreement or
the Parties expressly so agree in writing.  The Development  Committee shall not
have the power to amend or modify this  Agreement,  which may only be amended or
modified as provided in Section 16.4.

                  3.5 REGULATORY  APPROVALS.  All INDs,  NDAs and other filings,
applications  or  requests  pursuant  to or in  connection  with the  Regulatory
Approvals  required  under  the  Development  Plan  shall be made in the name of
Licensee or its  designee,  unless  Applicable  Law  requires  that a Regulatory
Approval be solely or jointly in the name of NovaDel or its Affiliates, in which
case  NovaDel  hereby  assigns  and shall  cause its  Affiliates  to assign,  as
applicable,  such  Regulatory  Approval to Licensee to the extent  permitted  by
Applicable  Law;  provided,  however,  that  NovaDel  shall  have  a  perpetual,
irrevocable,  worldwide right to use and reference the Regulatory  Documentation
with respect to the Licensed Product and any data included or referenced therein
for all purposes.  NovaDel,  with prior notice to the  Licensee,  shall have the
right  to  communicate  with  the  Regulatory  Authorities  with  regard  to the
Development Activities.  Licensee agrees that the Drug Master File ("DMF") shall
be owned by NovaDel,  provided that Licensee shall have unlimited  access to the
DMF for purposes of any Regulatory  Filings  relating to each Licensed  Product.
Licencee  agrees to request  that the DMF be treated  as  confidential.  NovaDel
agrees to keep the Licensee  reasonably  informed as to the  communications,  if
any, between NovaDel and the Regulatory Authorities.

                                    Page 10
<PAGE>

                  3.6  REGULATORY  RECORDS.  NovaDel  and  Licensee  each  shall
maintain,  or cause to be  maintained,  records  of its  respective  Development
Activities in sufficient  detail and in good scientific  manner  appropriate for
patent and regulatory  purposes,  which shall be complete and accurate and shall
fully and properly reflect all work done and results achieved in the performance
of its respective  Development  Activities,  and which shall be retained by such
Party for at least five (5) years after the  termination of this  Agreement,  or
for such longer  period as may be required by  Applicable  Law. Each Party shall
have the right,  during normal  business hours and upon  reasonable  notice,  to
inspect and copy any such records.

                  3.7 DEVELOPMENT EXPENSES.

                       3.7.1   LICENSEE'S   OBLIGATION.   In   consideration  of
NovaDel's  performance of its Development  Activities,  Licensee shall reimburse
NovaDel for the reasonable and documented costs and expenses incurred by NovaDel
in performing such activities in accordance with the Development  Budget (as may
be amended in accordance  with Section 3.3).  Licensee  shall bear all costs and
expenses incurred by or on behalf of Licensee in connection with the performance
of its Development Activities.

                       3.7.2  INVOICES  AND  PAYMENTS.  Within  thirty (30) days
after  the end of each  month in which  Development  Activities  are  performed,
NovaDel shall invoice Licensee for any costs and expenses incurred by NovaDel or
its  Affiliates in such month.  Each invoice shall be payable to NovaDel  within
thirty (30) days after receipt by Licensee of such invoice.

                       3.7.3  BOOKS  AND  RECORDS.  Each  party  shall  maintain
complete and accurate  books,  records and accounts that, in reasonable  detail,
fairly  reflect  any  reimbursable  costs  and  expenses  incurred  by it or its
Affiliates in  performance  of the  Development  Activities  in conformity  with
Generally Accepted Accounting Principles ("GAAP").  Each party shall retain such
books, records and accounts until the later of (a) three (3) years after the end
of the period to which such books,  records and  accounts  pertain,  and (b) the
expiration  of the  applicable  tax statute of  limitations  (or any  extensions
thereof),  or for such longer period as may be required by Applicable  Law. Each
party shall have the right to have its certified public accountant, who shall be
reasonably  acceptable to NovaDel,  audit the books and financial records of the
other  party  and  their  respective  Affiliates  relating  to  its  Development
Activities  during  one or  more  calendar  quarters;  provided,  however,  that
Licensee shall not have the right to audit a calendar  quarter more than two (2)
years after the end of such quarter,  to conduct more than one such audit in any
twelve-month  period,  or to audit any  calendar  quarter  more than  once;  and
provided  further  that each party shall bear the cost of such audit  unless the
audit  reveals  a  variance  of more than five  percent  (5%) from the  reported
results,  in which case  audited  party  shall  bear the cost of the audit.  The
results of such accounting firm shall be final, absent manifest error.

                  3.8  COOPERATION.  Each Party shall cooperate with any and all
reasonable  requests  for  assistance  from the other Party with  respect to the
Development Activities, including by making its employees, consultants and other
scientific  staff available upon reasonable  notice during normal business hours
at their  respective  places of  employment  to consult with such other Party on
issues  arising  in  connection  with  the   performance  of  such   Development
Activities.

                                    Page 11
<PAGE>

                  3.9 DEVELOPMENT AND USE OF TRADEMARKS. Licensee shall have the
sole  right  to  determine  the  Trademarks  to be  used  with  respect  to  the
Exploitation  of the Licensed  Product on a worldwide  basis,  provided that the
product  labeling and promotional  materials  disclose that the Licensed Product
are delivered using the Licensed Process and include the Licensed Trademarks.

                  3.10 DILIGENCE  OBLIGATIONS.  Licensee shall use  Commercially
Reasonable  Efforts to (a) develop and commercialize the Licensed Product in the
entire  Territory in accordance with the terms and conditions of this Agreement;
(b) obtain  Regulatory  Approval(s)  with respect to the Licensed Product in the
Territory;  and (c) thereafter  diligently and aggressively Exploit the Licensed
Product in the  Territory  to maximize  sales.  Licensee  shall  ensure that any
Sublicense  be  terminable  at the  option of the  Licensee  in the event that a
Sublicensee  fails to maintain active,  diligent  marketing efforts for Licensed
Product.

                  3.11 MANUFACTURING.

                       3.11.1   Subject  to  section   3.11.4,   NovaDel   shall
manufacture and supply Licensee with Licensed Product on commercially reasonable
terms  for  clinical   development  of  the  Licensed   Product  pursuant  to  a
manufacturing  agreement  (the  "Manufacturing  Agreement")  to be entered  into
following execution of this Agreement.

                       3.11.2 Subject to section  3.11.4,  following  receipt of
Regulatory Approval, NovaDel shall manufacture and supply Licensee with Licensed
Product  on  commercially   reasonable  terms  pursuant  to  the   Manufacturing
Agreement.

                       3.11.3  NovaDel  agrees  that,  at all times  during  the
performance of the  Development  Activities,  it will act in accordance with GMP
and all applicable laws, rules and regulations.

                       3.11.4 The  manufacturing  agreement  will provide  among
other  things that in the event that  Licensee  enters into a  Sublicense  for a
Licensed  Product and such  Sublicensee  desires to obtain rights to manufacture
such Licensed Product,  then NovaDel will not unreasonably  withhold its consent
to transfer the manufacturing rights to such Sublicensee, provided that measures
are incorporated  into the  sublicensing  agreement to continue to safeguard the
confidentiality  of NovaDel Know-how and technology with respect to the Licensed
Product as set forth in section 3.11.5

                       3.11.5 It is the intent of the  Parties  that  NovaDel be
the exclusive  manufacturer of the Licensed Product pursuant to the terms of the
Manufacturing  Agreement;  provided,  however, that in the event that NovaDel is
unable or unwilling to provide clinical or commercial supply of Licensed Product
within a reasonable  period of time upon  commercially  reasonable  terms,  then
Licensee  shall be  entitled to seek  alternate  manufacturing  source.  In such
event,  Licensee shall use  commercially  reasonable  efforts to ensure that any
such  alternate   manufacturing  source  agree  (a)  to  maintain  in  strictest
confidence all information  relating to the manufacture of the
Licensed Product and the Licensed  Technology,  (b) not to file any intellectual
property  protection  relating to inventions that may arise from the manufacture
of the

                                    Page 12
<PAGE>

Licensed Product and Licensed  Technology,  and (c) that any intellectual
property  that does arise out of the  manufacture  of the  Licensed  Product and
Licensed Technology belong to NovaDel.

                                    ARTICLE 4
                        ROYALTIES AND OTHER CONSIDERATION

                  4.1  ROYALTIES.  As  partial  consideration  for  the  rights,
privileges  and  licenses  granted  hereunder  and  the  Development  Activities
performed by Licensor  pursuant to Article 3, Licensee  shall make the following
payments to NovaDel:

                       4.1.1  Licensee  shall  pay to  NovaDel  royalties  in an
amount equal to the greater of (i) *** percent (***%) of worldwide aggregate Net
Sales by Licensee or any Affiliate of Licensee of each Licensed  Product  during
each calendar year and (ii) *** percent (***%) of worldwide aggregate Net Profit
by Licensee or any  Affiliate of Licensee of each Licensed  Product  during each
calendar year.

                       4.1.2  Licensee  shall  pay to  NovaDel  (1) ***  percent
(***%) of all royalties  received by Licensee or its Affiliate from sales by any
Sublicensee of Licensed Product until such time as Licensee has recovered all of
its out-of-pocket costs incurred directly in connection with the development and
commercialization of the Licensed Product, and thereafter (2) *** percent (***%)
of all  royalties  received  by  Licensee  or its  Affiliate  from  sales by any
Sublicensee of Licensed Product;

                       4.1.3  Licensee  shall  pay to  NovaDel  (1) ***  percent
(***%) of all Sublicensing Fees until such time as Licensee has recovered all of
its out-of-pocket costs incurred directly in connection with the development and
commercialization of the Licensed Product, and thereafter (2) *** percent (***%)
of all Sublicensing Fees.

                  4.2 ROYALTY TERM. Licensee's royalty obligations under Section
4.1  shall  terminate,  on a  country-by-country  basis,  with  respect  to each
Licensed  Product upon the expiration date in such country of the last to expire
of any issued NovaDel Patent that includes at least one Valid Claim covering the
sale of such Licensed  Product in such country.  Upon termination of the royalty
obligations under this Section 4.2 in a country,  the license grants to Licensee
in Section 2.1 shall be reduced in accordance with terms in Section 4.6.

                  4.3 ROYALTY PAYMENTS.  Royalties under Section 4.1.1 and Other
Income under 4.1.2(a) shall be payable to NovaDel on a quarterly  basis,  within
forty-five (45) days after the end of each calendar quarter; provided,  however,
at the end of a calendar year Licensee  shall  determine the actual amounts owed
to NovaDel under Section  4.1.2 and any  additional  amounts owed to NovaDel for
the first three  calendar  quarters of such calendar year shall be paid with the
royalty  payment  for the last  calendar  quarter  of such  calendar  year,  and
provided  further  in the  event  that  Licensee's  payments  for such  calendar
quarters exceed the actual royalties owed for such calendar  quarters,  Licensee
shall have the right to offset such excess payments  against the royalty payment
for the last calendar  quarter of such calendar year.  Only one royalty  payment
will be due on Net Sales of the Licensed  Product  even though the  manufacture,
sale  or  use of  such  Licensed  Product  may  be  covered  by  more  than  one
intellectual property right in a country.

                                    Page 13
<PAGE>

                  4.4 LICENSEE  FEE.  Licensee  shall pay to NovaDel $ *** as an
up-front licensing fee for the Designated Compound, payable in cash as follows:

                       4.4.1 $ *** within 10 Business  Days of the first date on
which the Licensee has  received an  aggregate of  $5,000,000  through an equity
financing or otherwise  (including  receipt of any  milestone  payments or other
revenues); and

                       4.4.2 $ *** within 10 Business  Days of the first date on
which the Licensee has  received an aggregate of  $10,000,000  through an equity
financing or otherwise  (including  receipt of any  milestone  payments or other
revenues).

                  4.5 MILESTONE PAYMENTS. Licensee shall also pay to NovaDel the
following Milestone Payments:

                       4.5.1 $ *** within five (5)  Business  Days from the date
on which the  Company's  first filed NDA is accepted for review by the FDA for a
Licensed Product; and

                       4.5.2 $ *** within five (5)  Business  Days from the date
on which the Company's first filed European Marketing Application for a Licensed
Product in any country  within the European  Union is accepted for review by the
appropriate Regulatory Authority; and

                       4.5.3 $ *** within five (5)  Business  Days from the date
on which the Company's first filed NDA for a Licensed Product is approved by the
FDA; and

                       4.5.4 $ *** within five (5)  Business  Days from the date
on which the Company's first filed European Marketing Application for a Licensed
Product in any country  within the European  Union is accepted for review by the
appropriate Regulatory Authority; and

                       4.5.5 $ *** within five (5)  Business  Days from the date
on which the application for commercial  approval for the Licensed  Product with
the  appropriate  Regulatory  Authority  is  approved in each  Secondary  Market
Country

                       4.5.6 $ *** within five (5)  Business  Days from the date
on which the Company's application for regulatory approval of a Licensed Product
is approved by the  appropriate  Regulatory  Authority in any country other than
Major Market Countries or Secondary Market Countries.

                  4.6  REDUCTION  OF  PAYMENTS.  In the event that,  or from and
after  the date on which,  (a) no Valid  Claim of a NovaDel  Patent  covering  a
Licensed  Product  exists in a country and (b) no  regulatory  exclusivity  with
respect to such Licensed  Product exists in such country (whether as a result of
expiration of the exclusivity  period or otherwise),  (i) the milestone payments
set forth in Section 4.5 with respect to such Licensed Product, if any, and (ii)
the royalty rate payable to NovaDel by Licensee  under  Section 4.1 with respect
to sales of such  Licensed  Product  in such  country,  each shall be reduced by
seventy-five percent (75%).

                  4.7 MODE OF  PAYMENT.  All  payments  to  NovaDel  under  this
Agreement shall be paid in United States Dollars to a bank account in the United
States  as  NovaDel  may  reasonably  designate.  Any  withholding  taxes  which
Licensee, its Affiliates or any Sublicensee

                                    Page 14
<PAGE>

shall be required by  applicable  law to withhold on  remittance of the payments
shall be deducted  from such payment to NovaDel and remitted to the  appropriate
Regulatory Authority. Licensee shall furnish NovaDel with the original copies of
all  official  receipts  for such taxes.  If any  currency  conversion  shall be
required in connection with the payments  hereunder,  such  conversion  shall be
made by using the average of the exchange rates prevailing at Citibank,  N.A. in
New York,  New York on the first  business  day of each  month in the  reporting
period to which such payments relate.

                  4.8  NON-REFUNDABLE,   NON-CREDITABLE.  The  amounts  paid  or
payable under this Article 4 shall be non-refundable and non-creditable  against
any other amounts due NovaDel under this Agreement.

                                    ARTICLE 5
                               REPORTS AND RECORDS

                  5.1  RECORD  RETENTION.  Licensee  shall  maintain  (and shall
ensure  that its  Affiliates  and  Sublicensees  shall  maintain)  complete  and
accurate  books,  records and accounts that fairly reflect their  respective Net
Sales,  Other Income and any milestones payable with respect to Licensed Product
in sufficient detail to confirm the accuracy of any payments required  hereunder
and in accordance with GAAP, which books, records and accounts shall be retained
by  Licensee  until the later of (a) three (3) years after the end of the period
to which such books, records and accounts pertain, and (b) the expiration of the
applicable tax statute of limitations (or any extensions  thereof),  or for such
longer period as may be required by Applicable Law.

                  5.2 AUDIT. NovaDel shall have the right to have an independent
certified public accounting firm of nationally  recognized standing,  reasonably
acceptable to Licensee,  to have access during normal business  hours,  and upon
reasonable  prior  written  notice,  to such of the records of Licensee (and its
Affiliates  and  Sublicensees)  as may be  reasonably  necessary  to verify  the
accuracy  of such Net Sales,  Milestone  Payments or  Sublicense  Income for any
calendar  quarter ending not more than  thirty-six (36) months prior to the date
of such  request;  provided,  however,  that NovaDel shall not have the right to
conduct more than one such audit in any twelve (12)-month period. The accounting
firm shall  disclose  to each Party  whether  such Net  Sales,  Other  Income or
milestone  payments are correct or incorrect and the specific details concerning
any  discrepancies.  NovaDel  shall bear the cost of such audit unless the audit
reveals  an  under-reporting  or  underpayment  in excess of the  greater of one
hundred thousand dollars ($100,000) or two percent (2%) of royalties,  Milestone
Payments or Sublicense  Income  payable for such period,  in which case Licensee
shall bear the cost of the audit,  rectify  such  underpayment  and pay  NovaDel
applicable interest as required by Section 5.5. All payments required under this
Section 5.2 shall be due within  thirty (30) days of the date  NovaDel  provides
Licensee notice of the payment due. The results of such accounting firm shall be
final, absent manifest error.

                  5.3  REPORTS.  Within  thirty  (30)  days  of the  end of each
quarter of each calendar year,  Licensee  shall deliver to NovaDel  complete and
accurate reports,  giving such particulars of the business conducted by Licensee
during the preceding  quarter  under this

                                    Page 15
<PAGE>

Agreement  as shall be  pertinent  to an  accounting  for  royalties,  milestone
payments and Other Income hereunder. These shall include at least the following:

                       5.3.1 All Licensed  Product  used,  leased or sold, by or
for Licensee or its Affiliates.

                       5.3.2 Total amounts  invoiced for Licensed  Product used,
leased or sold, by or for Licensee or its Affiliates.

                       5.3.3  Deductions  applicable  in computed "Net Sales" as
defined in Section 1.33.

                       5.3.4 Total  milestone  payments due based on achievement
of milestones.

                       5.3.5 Total Sublicensing  Income owed by License from its
Sublicensees.

                       5.3.6  Total  royalties  due based on Net Sales by or for
Licensee or its Affiliates  and  Sublicensing  Income owed by its  Sublicensees,
including any adjustments pursuant to Section 4.3.

                       5.3.7  Names  and  addresses  of  all   Sublicensees  and
Affiliates of Licensee.

                  5.4 FINANCIAL STATEMENTS. Within one hundred twenty (120) days
of the end of each fiscal year of Licensee,  Licensee shall provide NovaDel with
a copy of Licensee's audited financial statements for such year to NovaDel.

                  5.5  INTEREST.  Amounts  which are not paid when due and which
are not the subject of a bona fide dispute  shall accrue  interest  from the due
date until paid, at a rate equal to the then prevailing  prime rate of Citibank,
N.A., plus six percent (6%), but in no event  exceeding the amount  permitted by
applicable law.

                  5.6 CONFIDENTIALITY.  Each report received by NovaDel shall be
treated by NovaDel as if it were "Confidential Information" subject to the terms
of Article 16.

                                    ARTICLE 6
                              PATENT AND TRADEMARK
                           PROSECUTION AND MAINTENANCE

                  6.1  OWNERSHIP  OF  INFORMATION  AND  INVENTIONS.  Subject  to
Section 6.2 and the license grants under Article 2, as between the Parties, each
Party shall own and retain all right,  title and interest in and to any and all:
(a)  Information  and Inventions  that are conceived,  discovered,  developed or
otherwise  made  by or on  behalf  of  such  Party  (or  its  Affiliates  or its
Sublicensees  (other than the other Party and its  Affiliates)),  whether or not
patented or patentable,  and any and all Patent and other intellectual  property
rights with respect  thereto;  and (b) other  Information  and  Inventions,  and
Patent and other  intellectual  property rights that are Controlled  (other than
pursuant  to the  license  grants  set forth in Article  2) by such  Party,  its

                                    Page 16
<PAGE>

Affiliates  or  Sublicensees  (other than the other  Party and its  Affiliates).
Subject to the  license  grants to  Licensee  under  Article  2, as between  the
Parties,  NovaDel  shall own and retain all right,  title and interest in and to
all Licensed Technology.

                  6.2 OWNERSHIP OF THE LICENSED PROCESS.  Subject to the license
grants to Licensee  under  Article 2, as between the Parties,  NovaDel shall own
and  retain  all  right,  title and  interest  in and to the  Licensed  Process,
including any and all  Information  and Inventions  with respect to the Licensed
Process  (including any  Improvements  thereto) that are conceived,  discovered,
developed or otherwise  made,  by or on behalf of Licensee,  its  Affiliates  or
Sublicensees (other than NovaDel and its Affiliates), whether or not patented or
patentable,  and any and all Patent and other intellectual  property rights with
respect thereto.  Licensee acknowledges and agrees that (a) the licenses granted
to it pursuant to Section 2.1 permit Licensee to use the Licensed Process solely
for the  Exploitation  of Licensed  Product as provided in this  Agreement,  (b)
Licensee  has no right to use the Licensed  Process or to  discover,  develop or
otherwise  make  Improvements  with respect to the Licensed  Process  under such
grants,  and (c) neither it, nor any of its  Affiliates  or  Sublicensees,  will
engage,  directly  or  indirectly,  in  activities  designed  to,  or  otherwise
undertake  or  attempt,  either on behalf of  itself or  another,  to  discover,
develop or make any  Information  and  Inventions  that  relate to the  Licensed
Process.  Accordingly,  Licensee shall promptly  disclose to NovaDel in writing,
the conception or reduction to practice, or the discovery, development or making
of any such  Information and Inventions that relate to the Licensed  Process and
shall, and does hereby,  assign, and shall cause its Affiliates and Sublicensees
to so  assign,  to  NovaDel,  without  additional  compensation,  all  of  their
respective  rights,  titles and  interests  in and to any such  Information  and
Inventions.

                  6.3 OWNERSHIP OF JOINT TECHNOLOGY.  Subject to Section 6.2 and
the  license  grants  under  Article  2, the  Parties  shall  each own an equal,
undivided  interest  in and to any  and  all  (a)  Information  and  Inventions,
conceived,  discovered,  developed or otherwise made, jointly by or on behalf of
NovaDel (or its Affiliates or its  sublicensees),  on the one hand, and Licensee
(or its Affiliates or  Sublicensees),  on the other hand, in connection with the
work  conducted  under or in  connection  with this  Agreement,  whether  or not
patented  or  patentable;  and (b)  Patents  (the  "Joint  Patents")  and  other
intellectual  property  rights with respect  thereto  (collectively,  the "Joint
Technology").  Each Party shall promptly disclose to the other Party in writing,
and shall cause its Affiliates,  licensees and sublicensees to so disclose,  the
development,   making,   conception  or  reduction  to  practice  of  any  Joint
Technology.

                  6.4 OWNERSHIP OF LICENSED  TRADEMARKS.  Subject to the license
grants under Article 2, as between the Parties, NovaDel shall own and retain all
right,  title and interest in and to the Licensed  Trademarks.  Licensee  hereby
acknowledges  and affirms (a) that to the best of its  knowledge,  the  Licensed
Trademarks and the  registrations  thereof are valid and (b) that NovaDel or its
Affiliates,  as the case may be,  are the  owners  of all right and title to and
interest in the Licensed Trademarks and the registrations thereof, including any
form or embodiment thereof,  and the goodwill now and hereafter  associated with
the  Licensed  Trademarks.  Licensee  (on its own  behalf  and on  behalf of its
Affiliates)  expressly  disclaims  any  right  or title  to or  interest  in the
Licensed  Trademarks  and the  registrations  thereof,  except  for the  license
granted in Section 2.1.2.  Licensee  hereby agrees and  undertakes  that it will
not, and it will cause its  Affiliates  not to,  contest or dispute the validity
of, or the rights of NovaDel and its Affiliates,  as the case may be, in and to,
the Licensed Trademarks,  or any part thereof, or the registrations thereof, nor

                                    Page 17
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knowingly  impair or endanger  the  validity of any of the  foregoing.  Licensee
acknowledges that all use of the Licensed Trademarks by or on behalf of Licensee
or its Affiliates shall inure to the benefit of NovaDel and its Affiliates. Upon
termination of the license granted in Section 2.1.2, Licensee and its Affiliates
shall not be entitled to any  compensation  for any increase in the value of the
Licensed Trademarks or for any goodwill associated  therewith.  If so requested,
Licensee  shall,  and shall  cause its  Affiliates  to,  assist  NovaDel and its
Affiliates  to  safeguard  their full  right,  title and  interest in and to the
Licensed Trademarks and the registrations thereof.

                  6.5  UNITED   STATES  LAW.   The   determination   of  whether
Information  and Inventions are  conceived,  discovered,  developed or otherwise
made by a Party for the  purpose of  allocating  proprietary  rights  (including
Patent,  copyright or other  intellectual  property rights) therein,  shall, for
purposes of this Agreement,  be made in accordance with applicable United States
law.

                  6.6 PROSECUTION OF PATENTS AND TRADEMARKS.

                       6.6.1  PROSECUTION OF NOVADEL PATENTS AND TRADEMARKS.  As
between the Parties, NovaDel shall have the sole right, at its cost and expense,
to obtain,  prosecute and maintain  throughout the world the NovaDel Patents and
Licensed Trademarks;  provided,  however,  that Licensee shall reimburse NovaDel
for one hundred percent (100%) of the reasonable out-of-pocket costs incurred by
NovaDel for filing,  prosecuting  and  maintaining  such NovaDel  Patents to the
extent that they claim or cover solely the Exploitation of the Licensed Product.
Licensee shall, and shall cause its Affiliates and Sublicensees,  as applicable,
to, cooperate fully with NovaDel in the preparation,  filing,  prosecution,  and
maintenance  of  NovaDel's  Patents.  Such  cooperation  includes  (a)  promptly
executing all papers and  instruments  and  requiring  employees to execute such
papers and  instruments as reasonable and appropriate so as to enable NovaDel to
file,  prosecute,  and  maintain  its Patents in any  country;  and (b) promptly
informing   NovaDel  of  matters  that  may  affect  the  preparation,   filing,
prosecution,  or maintenance of any such Patents. NovaDel shall provide Licensee
with drafts of all patent  applications  and other  material  submissions to and
correspondence  with any patent  authorities to the extent such  applications or
submissions relate to the Licensed Technology (other than the Licensed Process),
in sufficient time, but in any event not less than thirty (30) days prior to the
date a reply is required by the relevant patent authorities, to allow for review
and comment by Licensee.  In addition,  NovaDel shall  provide  Licensee with an
opportunity  to consult  with NovaDel  regarding  the filing and contents of any
such application,  submission or correspondence. If Licensee provides to NovaDel
comments with respect to any such application,  submission or correspondence, to
the extent  such  comments  relate to any  Licensed  Technology  (other than the
Licensed Process), NovaDel agrees to reasonably consider such comments, it being
understood that NovaDel retains the right to determine whether to comply with or
incorporate  such  comments,  if at all. If (x) NovaDel elects not to pursue the
filing,  prosecution or maintenance of a NovaDel Patent in a particular country,
or to take any other  action with  respect to a NovaDel  Patent in a  particular
country that is necessary or useful to establish or preserve rights with respect
to the  Licensed  Product,  and (y)  such  Patent  does not  claim or cover  the
Licensed Process,  then NovaDel shall so notify Licensee promptly in writing and
in good time to enable Licensee to meet any deadlines by which an action must be
taken to establish  or preserve  any such rights in such NovaDel  Patent in such
country.  Upon receipt of any such notice by NovaDel or if, at any time, NovaDel
fails to  initiate  any such action  within

                                    Page 18
<PAGE>

thirty  (30) days  after a request  by  Licensee  that it do so (and  thereafter
diligently  pursue  such  action),  Licensee  shall have the right,  but not the
obligation,  to pursue the filing or  registration,  or  support  the  continued
prosecution  or  maintenance,  of such  NovaDel  Patent at its  expense  in such
country.  If Licensee elects to pursue such filing or registration,  as the case
may be, or continue such support,  then  Licensee  shall notify  NovaDel of such
election and NovaDel  shall,  and shall cause its  Affiliates to, (x) reasonably
cooperate  with  Licensee in this regard,  and (y)  promptly  grant to Licensee,
without  additional  consideration,   an  exclusive,   perpetual,   irrevocable,
royalty-free license in such country under such NovaDel Patent.

                       6.6.2 JOINT  PATENTS.  The Parties shall  cooperate,  and
shall cause their  respective  Affiliates and  Sublicensees,  as applicable,  to
cooperate,  with  one  another  with  respect  to the  filing,  prosecution  and
maintenance  of all Joint  Patents,  including  by  selecting  outside  counsel,
reasonably  acceptable to the Parties,  to handle such filing,  prosecution  and
maintenance. The Parties shall share equally in the expenses associated with the
filing,  prosecution  (including  any  interferences,  reissue  proceedings  and
reexaminations)  and maintenance of all Joint Patents.  If a Party elects not to
pursue the filing,  prosecution or maintenance of a Joint Patent in a particular
country,  or to take any other  action  with  respect to Joint  Technology  in a
particular  country  that is  necessary  or  reasonably  useful to  establish or
preserve rights  thereto,  then in each such case such Party shall so notify the
other  Party  promptly in writing and in good time to enable such other Party to
meet any deadlines by which an action must be taken to establish or preserve any
such rights in such Joint Technology in such country.  Upon receipt of each such
notice by such other Party or if, at any time,  such Party fails to initiate any
such action  within thirty (30) days after a request by such other Party that it
do so (or thereafter diligently pursue such action), such other Party shall have
the right,  but not the  obligation,  to pursue the filing or  registration,  or
support the continued prosecution or maintenance,  of such Patent at its expense
in  such  country.  If  such  other  Party  elects  to  pursue  such  filing  or
registration,  as the case may be, or  continue  such  support,  then such other
Party shall notify such Party of such  election and such Party shall,  and shall
cause its  Affiliates,  licensees  and  sublicensees,  as  applicable,  to,  (x)
reasonably  cooperate  with such other Party in this  regard,  and (y)  promptly
release or assign to such other Party,  without  compensation,  all right, title
and interest in and to such Patent in such country.

                  6.7 ENFORCEMENT OF PATENTS AND TRADEMARKS.

                       6.7.1  TECHNOLOGY  AND  TRADEMARKS OF NOVADEL.  If either
Party  determines  that any  Technology  or  Trademark  of  NovaDel or any Joint
Technology  is being  infringed  by a Third  Party's  activities  and that  such
infringement could affect the exercise by the Parties of their respective rights
and obligations under this Agreement,  it shall promptly notify such other Party
in writing and provide such other Party with any  evidence of such  infringement
that is reasonably available. Promptly after the receipt of such written notice,
the  Parties  shall  meet  and  discuss  in  good  faith  the  removal  of  such
infringement.  NovaDel  shall  consider in good faith any comments from Licensee
and shall keep  Licensee  reasonably  informed of any steps taken to remove such
infringement.  NovaDel shall have the first right,  but not the  obligation,  to
remove such infringement at its sole cost and expense;  provided,  however, that
Licensee  shall  reimburse  NovaDel  for  one  hundred  percent  (100%)  of  the
reasonable  out-of-pocket  costs incurred by NovaDel with respect to the removal
of any such infringement to the extent that such infringement  adversely affects
the Exploitation of the Licensed Product. In the

                                    Page 19
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event that  NovaDel  fails  within  ninety  (90) days  following  notice of such
infringement, or earlier notifies Licensee in writing of its intent not, to take
commercially appropriate steps to remove any infringement of any NovaDel Patent,
Joint  Patent or Licensed  Trademark  that is likely to have a material  adverse
effect on the sale of a Licensed Product, Licensee shall have the right to do so
at  Licensee's  expense;  provided,  however,  that  if  NovaDel  has  commenced
negotiations with an alleged  infringer for  discontinuance of such infringement
within such ninety (90) day period, NovaDel shall have an additional ninety (90)
days to  conclude  its  negotiations  before  Licensee  may bring  suit for such
infringement,  and  provided  further  that  Licensee  shall not enter  into any
settlement or  compromise  with respect to any NovaDel  Patent,  Joint Patent or
Licensed  Trademark without NovaDel's prior consent,  which consent shall not be
unreasonably  withheld.  Each Party shall provide  reasonable  assistance to the
other  Party,  including  providing  access  to  relevant  documents  and  other
evidence,  making its employees  available at  reasonable  business  hours,  and
joining  the  action to the extent  necessary  to allow the  enforcing  Party to
maintain the action.  Any amounts recovered by a Party pursuant to this Section,
whether by  settlement  or judgment,  shall be used to reimburse the Parties for
their reasonable costs and expenses in making such recovery (which amounts shall
be allocated pro rata if  insufficient  to cover the totality of such expenses),
with any  remainder  being  retained by the Party that  brought the  enforcement
action; provided,  however, that to the extent that any award is attributable to
the loss of sales of Licensed Product, such amount shall be paid to Licensee and
shall be treated as Net Sales on which royalties shall be due under Article 4.

                  6.8 POTENTIAL THIRD PARTY RIGHTS.

                       6.8.1  THIRD-PARTY  LICENSES.  If (a) in the  opinion  of
outside  patent  counsel to  Licensee,  Licensee,  or any of its  Affiliates  or
Sublicensees,  cannot  Exploit a Licensed  Product in a country in the Territory
without infringing one or more Patents that have issued to a Third Party in such
country,  or (b) as a result of any claim  made  against a Party,  or any of its
Affiliates or Sublicensees, alleging that the Exploitation of a Licensed Product
infringes or misappropriates any Patent or any other intellectual property right
of a Third Party in a country in the Territory, a judgment is entered by a court
of  competent  jurisdiction  from  which  no  appeal  is taken  within  the time
permitted for appeal, such that Licensee cannot Exploit such Licensed Product in
such country without  infringing the Patent or other proprietary  rights of such
Third Party, then, in either case,  Licensee shall have the first right, but not
the  obligation  to  negotiate  and to obtain a license from such Third Party as
necessary  for  the  Exploitation  of any  Licensed  Product  hereunder  in such
country;  provided,  however, that NovaDel shall have the sole right to seek any
such license with  respect to the  Licensed  Process and shall use  commercially
reasonable  efforts  to obtain  such a license  in its own name from such  Third
Party in such country,  under which  NovaDel  shall,  to the extent  permissible
under such  license,  grant a sublicense  to Licensee as necessary for Licensee,
and any of its Affiliates and  Sublicensees,  to Exploit the Licensed Product as
provided hereunder in such country. Licensee shall be solely responsible for one
hundred percent (100%) of all royalty and other  obligations with respect to the
Exploitation of the Licensed  Product;  provided,  however,  that Licensee shall
have the right to credit fifty percent (50%) any royalties paid by Licensee, its
Affiliates  or  Sublicensees  under such  license  with  respect to such country
against the royalty  payments to be paid by Licensee to NovaDel  with respect to
the sale of the Licensed Product(s) under Section 4.1; provided,  however,  that
no  royalty  payment  when due,  regardless  of the  amount or number of credits
available to Licensee in  accordance  with this  Agreement,  shall be reduced by
more than fifty

                                    Page 20
<PAGE>

percent  (50%) of the  amounts  otherwise  owed  pursuant  to Section 4.1 in any
calendar  quarter.  Credits not exhausted in any calendar quarter may be carried
into future calendar quarters.

                       6.8.2 THIRD PARTY  LITIGATION.  In the event that a Third
Party institutes a patent,  trademark or other  infringement suit (including any
suit alleging the  invalidity or  unenforceability  of the Patents of a Party or
its  Affiliates,  or claiming  confusion,  deception or dilution of a Trademark)
against either Party or its  respective  Affiliates,  licensees or  Sublicensees
during the Term, alleging use of the Licensed Technology, Licensed Trademarks or
any other activities hereunder, infringes one or more patent, trademark or other
intellectual  property rights held by such Third Party (an "Infringement Suit"),
the Parties shall  cooperate  with one another in defending  such suit.  NovaDel
shall have the first right to direct and control  any  Infringement  Suit to the
extent  that it  relates to the use of the  Licensed  Technology,  the  Licensed
Trademarks  or the  Licensed  Process;  provided  that  Licensee  shall bear one
hundred  percent  (100%)  of the  costs and  expenses  associated  with any such
Infringement  Suit to the  extent  that it relates  to the  Exploitation  of the
Licensed Product.

                       6.8.3 RETAINED RIGHTS.  Nothing in this Section 6.8 shall
prevent Licensee, at its own expense, from obtaining any license or other rights
from  Third  Parties  it  deems  appropriate  in order  to  permit  the full and
unhindered exercise of its rights under this Agreement.

                                    ARTICLE 7
                              TERM OF THE AGREEMENT

                  7.1 TERM. Unless otherwise  terminated  pursuant to Article 8,
this Agreement shall enter into effect on the Effective Date and shall remain in
full force and effect on a  country-by-country  basis until the later of (a) the
expiration date of the last to expire of any issued NovaDel Patent that includes
at least  one  Valid  Claim  and (b) the  twentieth  (20th)  anniversary  of the
Effective Date.

                                    ARTICLE 8
                                   TERMINATION

                  8.1  TERMINATION  UPON  INSOLVENCY.  If Licensee  shall become
bankrupt,  or  shall  file  a  petition  in  bankruptcy  or  insolvency  or  for
reorganization  or for an  arrangement  or for the  appointment of a receiver or
trustee or of its assets, or if an involuntary petition for any of the foregoing
shall be filed with  respect to Licensee  and not  dismissed  within  sixty (60)
days, or if the business of Licensee shall be placed in the hands of a receiver,
assignee or trustee for the benefit of  creditors,  whether by the voluntary act
of Licensee or otherwise, this Agreement shall automatically terminate.

                  8.2 TERMINATION FOR PAYMENT  DEFAULT.  Should Licensee fail to
make payment to NovaDel of royalties or other amounts due in accordance with the
terms of this  Agreement,  NovaDel  shall  have  the  right  to  terminate  this
Agreement  within ten (10) days after giving said notice of  termination  unless
Licensee shall pay to NovaDel,  within the 10-day  period,  all such amounts due
and payable.  Upon the  expiration of the 10-day  period,  if Licensee shall

                                    Page 21
<PAGE>

not have paid all such  amounts  due and  payable,  the rights,  privileges  and
licenses  granted  hereunder  shall,  at  the  option  of  NovaDel,  immediately
terminate.  In the event a payment is the subject of a bona fide dispute between
NovaDel and Licensee  that is being  pursued by a Party  pursuant to the dispute
resolution  mechanism in Article 9, then Licensee  shall make such payment,  but
shall  provide  NovaDel  with  written  notice  that such  payment is being made
subject to the outcome of such pending dispute  resolution  procedure and in the
event such  dispute is finally and  conclusively  resolved in favor of Licensee,
NovaDel shall refund such payment to Licensee with interest  calculated pursuant
to Section 5.5 from the date of such payment.

                  8.3 TERMINATION FOR MATERIAL BREACH.  Upon any material breach
or  default  of this  Agreement  by  either  Party,  other  than as set forth in
Sections 8.1 or 8.2 above,  and subject to Section 2.4.3,  the other Party shall
have the right to  terminate  this  Agreement  and the  rights,  privileges  and
licenses granted  hereunder upon giving thirty (30) days notice to the breaching
Party.  Such  termination  shall become  effective  upon the  expiration of such
thirty  (30)-day  period  unless the  breaching  Party shall have cured any such
breach or default prior to the expiration of such thirty (30) day period.

                  8.4 FAILURE TO OBTAIN FINANCING.  Notwithstanding  anything to
the contrary  herein,  should Licensee fail to obtain financing in the amount of
Five Million Dollars (US$5,000,000) (the "Minimum Financing") by March 31, 2004,
NovaDel  shall have the right,  which  right shall  continue  until such time as
Licensee obtains the Minimum Financing,  but not the obligation,  to immediately
terminate this Agreement upon written notice to Licensee.

                  8.5  TERMINATION BY THE LICENSEE.  The Licensee shall have the
right at any time to  terminate  this  Agreement  in whole or as to any Licensed
Product by giving 90 days notice thereof in writing to NovaDel.

                  8.6 SURVIVAL.  Any expiration or termination of this Agreement
shall not affect the rights and obligations of the Parties accrued prior to such
expiration or termination.  Without limiting the foregoing, Articles 4, 5, 6, 9,
10, 11, 14, 15 and 16 and Sections 8.6, 8.7, 8.8, 16.1,  16.7 and this 8.6 shall
survive the termination or expiration of this Agreement for any reason.

                  8.7 WORK-IN-PROGRESS.  Licensee and/or any Sublicensee thereof
may, however,  after the effective date of such termination and continuing for a
period not to exceed  six (6) months  thereafter,  sell all  completed  Licensed
Product,  and any Licensed  Product in the process of manufacture at the time of
such termination,  and sell the same,  provided that Licensee shall pay or cause
to be paid to NovaDel  the  royalties  thereon as  required by Article 4 of this
Agreement and shall submit the reports required by Article 5 hereof on the sales
of Licensed Product.

                  8.8 RETURN OF INFORMATION; ASSIGNMENT AND LICENSE.

                       8.8.1 Upon termination of this Agreement, Licensee shall,
and shall cause its Affiliates  and  Sublicensees,  as applicable,  to return to
NovaDel any and all data,  files,  records and other materials in its possession
or control  that  relate to the  Licensed  Technology  or  contain  or  comprise
NovaDel's  Information and Inventions or other Confidential  Information (except
one copy of each that may be retained for archival purposes).

                                    Page 22
<PAGE>

                       8.8.2 Upon the  termination of this  Agreement,  Licensee
(a) shall,  and shall  cause its  Affiliates  and,  subject  to  Section  8.8.3,
Sublicensees  to,  promptly  disclose to NovaDel,  in whatever  form NovaDel may
request,  all Regulatory  Documentation and all other Information and Inventions
in the possession or Control of Licensee,  its Affiliates or  Sublicensees  that
relate to the Exploitation of such Licensed Product, (b) shall, and does hereby,
assign,   and  shall  cause  its  Affiliates  and,  subject  to  Section  8.8.3,
Sublicensees to assign,  to NovaDel,  without  additional  compensation,  all of
their respective rights,  titles and interests in and to any and all (i) patent,
trademark,  copyright or other  intellectual  property  rights,  (ii) Regulatory
Documentation  and all data  included  or  referenced  therein,  and (iii) other
Information  and  Inventions  in the  possession  or  Control of  Licensee,  its
Affiliates or Sublicensees, in each case that relate to the Exploitation of such
Licensed  Product  (the  "Agreement-Related  Assets")  and are  permitted  to be
assigned,  and (c) to the extent  that the  Agreement-Related  Assets may not be
assigned,  shall,  and does hereby,  grant,  and shall cause its Affiliates and,
subject to Section 8.8.3,  Sublicensees to grant, to NovaDel, without additional
compensation, a perpetual, irrevocable,  royalty-free, exclusive, sublicenseable
through  multiple  tiers of  sublicensees,  right and  license to  Exploit  such
Licensed Product in the Territory.

                       8.8.3 Notwithstanding anything contained in Section 8.8.1
or 8.8.2, in the event that any sublicense granted by Licensee survives pursuant
to Section 2.4.3,  the  Sublicensee may retain (a) the information and materials
identified  in  Section  8.8.1 that are  rightfully  in its  possession  and (b)
Agreement-Related Assets, in each case until the termination of such sublicense,
whereupon such Sublicensee shall return such materials to NovaDel,.

                  8.9 CUMULATIVE REMEDIES.  The rights and remedies set forth in
this  Article 8 are  cumulative  and in addition to any other rights that may be
available to the Parties.

                  8.10  NON-REFUNDABILITY  OF MILESTONES AND DEVELOPMENT  COSTS.
Any and all Milestone  Payments made to NovaDel by Licensee under Article 4.5 of
this  Agreement  shall be  non-refundable  in the event of  termination  of this
Agreement  by either party under any of the  provisions  of Article 8 other than
Article 8.5.

                                    ARTICLE 9
                                   ARBITRATION

                  9.1  PROCEDURES.  Any dispute arising from or relating to this
Agreement  shall be  determined  before a tribunal of three  arbitrators  in New
York,  New York in  accordance  with  the  Commercial  Arbitration  Rules of the
American  Arbitration  Association (the "AAA"). One arbitrator shall be selected
by  NovaDel,  one  arbitrator  shall  be  selected  by  Licensee  and the  third
arbitrator shall be selected by mutual agreement of the first two arbitrators or
by the AAA, if the  arbitrators  appointed by the Parties are unable to select a
third arbitrator within thirty (30) days.

                  9.2  PATENT  DISPUTES.  Any  claim,  dispute,  or  controversy
concerning the validity, enforceability, or infringement of any patent contained
in the NovaDel Patents licensed  hereunder shall be resolved in any court having
jurisdiction  thereof.  In the event that, in any  arbitration  proceeding,  any
issue shall arise  concerning the validity,  enforceability,  or infringement of
any patent contained in the NovaDel Patents licensed hereunder,  the arbitrators

                                    Page 23
<PAGE>

shall,  to  the  extent  possible,  resolve  all  issues  other  than  validity,
enforceability,  and infringement; in any event, the arbitrators shall not delay
the  arbitration  proceeding  for the purpose of obtaining or permitting  either
Party to obtain judicial resolution of such issues,  unless an order staying the
arbitration  proceeding  shall be entered by a court of competent  jurisdiction.
Neither Party shall raise any issue concerning the validity,  enforceability, or
infringement of any patent contained in the NovaDel Patents licensed  hereunder,
in  any  proceeding  to  enforce  any  arbitration  award  hereunder,  or in any
proceeding otherwise arising out of any such arbitration award.

                  9.3  COSTS.  The  costs  of such  arbitration  shall  be borne
proportionate  to the finding of fault as determined by the  arbitration  panel.
Judgment  on the  arbitration  award may be  entered  by any court of  competent
jurisdiction.

                                   ARTICLE 10
                          INDEMNIFICATION AND INSURANCE

                  10.1  INDEMNIFICATION  OF  NOVADEL.   Licensee  shall  defend,
indemnify and hold NovaDel,  its  Affiliates,  and their  respective  directors,
officers, employees and agents harmless from and against all liability, demands,
damages,  including expenses or losses including death, personal injury, illness
or property damage  (collectively,  "Losses") arising directly or indirectly out
of any: (a) breach of this Agreement by Licensee,  its Affiliates,  Sublicensees
or  permitted  assigns or  transferees;  (b) actual or  asserted  violations  of
Applicable Law by Licensee, its Affiliates,  Sublicensees or permitted assignees
or transferees;  (c) use by Licensee, its Affiliates,  Sublicensees or permitted
assignees or transferees of the Licensed  Technology or (d)  Exploitation of the
Licensed  Product  by  Licensee,  its  Affiliates,   Sublicensees  or  permitted
assignees  or  transferees,  except for those  Losses for which  NovaDel  has an
obligation to indemnify Licensee and its Affiliates pursuant to Section 10.2, as
to which  Losses  each Party  shall  indemnify  the other to the extent of their
respective  liability  for the Losses  and other  than as a result of  NovaDel's
gross negligence, recklessness or willful misconduct.

                  10.2  INDEMNIFICATION  OF  LICENSEE.   NovaDel  shall  defend,
indemnify and hold Licensee,  its Affiliates,  and their  respective  directors,
officers,  employees  and agents  harmless  from and against all Losses  arising
directly or  indirectly  out of any: (a) breach of this  Agreement by NovaDel or
its  Affiliates;  or (b) actual or  asserted  violations  of  Applicable  Law by
NovaDel or its  Affiliates,  except for those  Losses for which  Licensee has an
obligation to indemnify NovaDel and its Affiliates  pursuant to Section 10.1, as
to which  Losses  each Party  shall  indemnify  the other to the extent of their
respective liability for the Losses.

                  10.3 INDEMNIFICATION PROCEDURE.

                       10.3.1 NOTICE OF CLAIM. The indemnified  Party shall give
the indemnifying Party prompt written notice (an "Indemnification Claim Notice")
of any Losses or discovery of fact upon which such indemnified  Party intends to
base a request for indemnification under Section 10.1 or Section 10.2, but in no
event shall the indemnifying Party be liable for any Losses that result from any
delay in providing such notice. Each Indemnification Claim Notice must contain a
description  of the claim and the  nature and amount

                                    Page 24
<PAGE>

of such Loss (to the extent  that the nature and amount of such Loss is known at
such time).  The indemnified  Party shall furnish  promptly to the  indemnifying
Party  copies of all papers and  official  documents  received in respect of any
Losses.  All  indemnification  claims in respect of a Party,  its  Affiliates or
their respective directors,  officers, employees and agents shall be made solely
by such Party to this Agreement (the "Indemnified Party").

                       10.3.2  THIRD  PARTY  CLAIMS.   The   obligations  of  an
indemnifying  Party under this  Article 10 with  respect to Losses  arising from
claims of any Third Party that are subject to indemnification as provided for in
Sections  10.1 or 10.2 (a  "Third  Party  Claim")  shall be  governed  by and be
contingent upon the following additional terms and conditions:

                            (A)   CONTROL  OF  DEFENSE.   At  its  option,   the
indemnifying  Party may assume the  defense of any Third  Party  Claim by giving
written  notice to the  Indemnified  Party  within  thirty  (30) days  after the
indemnifying Party's receipt of an Indemnification  Claim Notice. The assumption
of the  defense of a Third Party  Claim by the  indemnifying  Party shall not be
construed  as an  acknowledgment  that  the  indemnifying  Party  is  liable  to
indemnify any indemnified  Party in respect of the Third Party Claim,  nor shall
it constitute a waiver by the  indemnifying  Party of any defenses it may assert
against any  indemnified  Party's claim for  indemnification.  Upon assuming the
defense of a Third  Party  Claim,  the  indemnifying  Party may  appoint as lead
counsel in the defense of the Third Party  Claim any legal  counsel  selected by
the indemnifying  Party. In the event the indemnifying Party assumes the defense
of a Third Party Claim, the Indemnified Party shall  immediately  deliver to the
indemnifying  Party all original notices and documents  (including court papers)
received by any  indemnified  Party in  connection  with the Third Party  Claim.
Should the  indemnifying  Party assume the defense of a Third Party  Claim,  the
indemnifying  Party  shall not be liable to the  Indemnified  Party or any other
indemnified  Party  for  any  legal  expenses   subsequently  incurred  by  such
indemnified Party in connection with the analysis,  defense or settlement of the
Third  Party  Claim.  In the event  that it is  ultimately  determined  that the
indemnifying  Party is not  obligated to  indemnify,  defend or hold harmless an
Indemnified  Party from and against the Third Party Claim, the Indemnified Party
shall  reimburse  the  indemnifying  Party for any and all  costs  and  expenses
(including  attorneys'  fees and costs of suit) and any Losses  incurred  by the
indemnifying  Party in its defense of the Third Party Claim with respect to such
Indemnified Party.

                            (B)  RIGHT  TO  PARTICIPATE   IN  DEFENSE.   Without
limiting  Section  10.3.2(a),   any  Indemnified  Party  shall  be  entitled  to
participate  in, but not  control,  the defense of such Third Party Claim and to
employ  counsel of its choice for such  purpose;  provided,  however,  that such
employment  shall be at the  Indemnified  Party's  own  expense  unless  (i) the
employment thereof has been specifically authorized by the indemnifying Party in
writing or (ii) the  indemnifying  Party has failed to assume  the  defense  and
employ  counsel  in  accordance  with  Section  10.3.2(a)  (in  which  case  the
Indemnified Party shall control the defense).

                            (C) SETTLEMENT.  With respect to any Losses relating
solely to the payment of money  damages in  connection  with a Third Party Claim
and that  will  not  result  in the  Indemnified  Party's  becoming  subject  to
injunctive  or other  relief or otherwise  adversely  affect the business of the
Indemnified  Party in any manner,  and as to which the indemnifying  Party shall
have  acknowledged in writing the obligation to indemnify the Indemnified  Party
hereunder,  the  indemnifying  Party shall have the sole right to consent to the
entry of any

                                    Page 25
<PAGE>

judgment,  enter into any settlement or otherwise  dispose of such Loss, on such
terms as the indemnifying Party, in its sole discretion, shall deem appropriate.
With respect to all other Losses in connection  with Third Party  Claims,  where
the  indemnifying  Party has  assumed  the  defense of the Third  Party Claim in
accordance with Section  10.3.2(a),  the indemnifying Party shall have authority
to consent to the entry of any judgment,  enter into any settlement or otherwise
dispose  of such Loss  provided  it  obtains  the prior  written  consent of the
Indemnified Party (which consent shall not be unreasonably withheld or delayed).
The  indemnifying  Party  shall  not be  liable  for  any  settlement  or  other
disposition  of a Loss by an  indemnified  Party  that is  reached  without  the
written  consent  of  the   indemnifying   Party.   Regardless  of  whether  the
indemnifying  Party  chooses to defend or prosecute  any Third Party  Claim,  no
indemnified  Party  shall  admit any  liability  with  respect  to,  or  settle,
compromise or discharge, any Third Party Claim without the prior written consent
of the indemnifying Party.

                            (D)   COOPERATION.   Regardless   of   whether   the
indemnifying  Party  chooses to defend or prosecute  any Third Party Claim,  the
Indemnified  Party  shall,  and shall  cause  each other  indemnified  Party to,
cooperate in the defense or prosecution  thereof and shall furnish such records,
information and testimony,  provide such witnesses and attend such  conferences,
discovery  proceedings,  hearings,  trials  and  appeals  as may  be  reasonably
requested in connection therewith.  Such cooperation shall include access during
normal  business  hours  afforded  to  indemnifying  Party  to,  and  reasonable
retention  by the  Indemnified  Party  of,  records  and  information  that  are
reasonably  relevant to such Third Party Claim, and making  indemnified  Parties
and other  employees  and agents  available  on a mutually  convenient  basis to
provide  additional   information  and  explanation  of  any  material  provided
hereunder,  and the indemnifying Party shall reimburse the Indemnified Party for
all its reasonable out-of-pocket expenses in connection therewith.

                            (E) EXPENSES.  Except as provided  above,  the costs
and  expenses,  including  fees and  disbursements  of counsel,  incurred by the
Indemnified Party in connection with any claim shall be reimbursed on a calendar
quarter basis by the indemnifying  Party,  without prejudice to the indemnifying
Party's right to contest the Indemnified  Party's right to  indemnification  and
subject to refund in the event the indemnifying  Party is ultimately held not to
be obligated to indemnify the Indemnified Party.

                  10.4 INSURANCE.

                       10.4.1 Prior to entering human clinical trials,  Licensee
shall have and maintain  such type and amounts of liability  insurance  covering
the manufacture,  supply,  use and sale of the Licensed Product as is normal and
customary  in  the  pharmaceutical  industry  generally  for  parties  similarly
situated,  and shall upon request provide NovaDel with a copy of its policies of
insurance in that regard, along with any amendments and revisions thereto.

                       10.4.2 At all times  during the  Development  Activities,
NovaDel  shall have and maintain  such type and amounts of  liability  insurance
covering the  manufacture,  supply,  use and sale of the Licensed  Product as is
normal and  customary  in the  pharmaceutical  industry  generally  for  parties
similarly  situated,  and shall upon request provide the Licensee with

                                    Page 26
<PAGE>

a copy of its policies of insurance  in that regard,  along with any  amendments
and revisions thereto.

                                   ARTICLE 11
                         REPRESENTATIONS AND WARRANTIES;
                             LIMITATION OF LIABILITY

                  11.1  REPRESENTATIONS,  WARRANTIES AND  COVENANTS.  Each Party
hereby  represents  and warrants to the other Party as of the Effective  Date as
follows:

                       11.1.1 DULY ORGANIZED.  Such Party is a corporation  duly
organized,  validly existing and in good standing under the laws of the state in
which it is  incorporated,  and has full  corporate  power and authority and the
legal  right to own and  operate  its  property  and  assets and to carry on its
business as it is now being  conducted and as is contemplated to be conducted by
this Agreement.

                       11.1.2 CORPORATE AUTHORITY.  Such Party (a) has the power
and authority  and the legal right to enter into this  Agreement and perform its
obligations  hereunder,  and (b) has  taken  all  necessary  action  on its part
required to  authorize  the  execution  and delivery of this  Agreement  and the
performance of its obligations  hereunder.  The Agreement has been duly executed
and  delivered  on  behalf  of  such  Party  and is  enforceable  against  it in
accordance with its terms,  subject to the effects of bankruptcy,  insolvency or
other laws of general  application  affecting the enforcement of creditor rights
and judicial principles  affecting the availability of specific  performance and
general  principles  of  equity,  whether  enforceability  is  considered  in  a
proceeding at law or in equity.

                       11.1.3 LITIGATION. Such Party is not aware of any pending
or threatened  litigation (and has not received any communication)  that alleges
that such Party's activities related to this Agreement have violated, or that by
conducting the activities as contemplated  herein such Party would violate,  any
of the intellectual property rights of any other Person.

                       11.1.4 CONSENTS,  APPROVALS, ETC. All necessary consents,
approvals and authorizations of all regulatory and governmental  authorities and
other  Persons  required  to be obtained  by such Party in  connection  with the
execution and delivery of this Agreement and the  performance of its obligations
hereunder have been obtained.

                       11.1.5  CONFLICTS.  The  execution  and  delivery of this
Agreement and the performance of such Party's  obligations  hereunder (a) do not
conflict with or violate any  requirement of applicable law or regulation or any
provision of the articles of incorporation,  bylaws, or any similar constitutive
document of such Party,  as  applicable,  in any  material  way,  and (b) do not
conflict with, violate, or breach or constitute a default or require any consent
under, any contractual obligation or court or administrative order by which such
Party is bound.

                  11.2 ADDITIONAL REPRESENTATIONS AND WARRANTIES OF NOVADEL.

                       11.2.1 NovaDel  represents and warrants to Licensee that,
to  its  Knowledge,   as  of  the  Effective  Date,  NovaDel  is  the  owner  or
(sub)licensee  (with the right to

                                    Page 27
<PAGE>

grant  sublicenses  to Licensee as  contemplated  under this  Agreement)  of the
NovaDel  Patents,  and has all right,  title, and interest in and to the NovaDel
Patents,  including exclusive,  absolute,  irrevocable right, title and interest
thereto,  free  and  clear  of  all  liens,   charges,   encumbrances  or  other
restrictions  or  limitations  of any  kind  whatsoever  and  to  the  NovaDel's
knowledge and belief there are no licenses, options, restrictions, liens, rights
of third parties, disputes, royalty obligations,  proceedings or claims relating
to,  affecting,  or limiting its rights or the rights of the Licensee under this
Agreement  with  respect  to,  or which may lead to a claim of  infringement  or
invalidity  regarding,  any part or all of the Licensed Technology and their use
as contemplated in the underlying patent applications as presently drafted.  The
NovaDel  Patents  have not, as of the  Effective  Date,  been held by a court of
competent jurisdiction to be invalid or unenforceable, in whole or in part.

                       11.2.2 To  NovaDel's  knowledge  and  belief  there is no
claim,  pending or  threatened,  of  infringement,  interference  or  invalidity
regarding,  any  part  or  all of  the  Licensed  Technology  and  their  use as
contemplated in the underlying patent applications as presently drafted.

                  11.3 ADDITIONAL  COVENANTS OF LICENSEE.  Licensee on behalf of
itself and its  Affiliates  agrees and  covenants  to the  extent  permitted  by
applicable law, never, in any country,  region or jurisdiction in the Territory,
to institute or prosecute any claim,  action or suit at law or in equity seeking
to have  any  claim in a  NovaDel  Patent  declared  invalid  or  unenforceable;
provided, however, that nothing contained herein shall prohibit Licensee and its
Affiliates  and  Sublicensees  from either (a)  asserting  any and all  defenses
available to it, including assertions relating to the validity or enforceability
of the NovaDel Patents,  in any suit or proceeding brought against them alleging
the  infringement  of any of the NovaDel  Patents,  or (b) asserting any and all
defenses, evidence and arguments, including lack of patentability of the subject
matter of a count or claim  and lack of  support  for a count or  claim,  in any
interference  involving a patent or patent  application owned by Licensee or its
Affiliates or Sublicensees  and a patent or patent  application  included within
the  definition  of the  NovaDel  Patents.  In its  agreements  with each of its
Sublicensees, Licensee shall include provisions requiring a covenant, materially
identical to that  Licensee is making in this Section  11.3,  on the part of the
Sublicensee,  and shall provide that NovaDel  shall have march-in  right to seek
termination  of  such  agreement  in the  event  the  Sublicensee  breaches  the
covenant.  NovaDel's  right  to seek  termination  of such  agreement  with  the
Sublicensee shall be subject to notice, cure and dispute resolutions  provisions
materially identical to the provision set forth in Section 7.2. Licensee and its
Affiliates  will  take  all  reasonable  action   (including   signing  required
documents) and offer full  cooperation to allow NovaDel to exercise the march-in
rights provided herein, to the extent permitted by law.

                  11.4 DISCLAIMER OF WARRANTY. EXCEPT FOR THE EXPRESS WARRANTIES
SET FORTH IN SECTIONS 11.1 AND 11.2, NOVADEL MAKES NO REPRESENTATIONS AND GRANTS
NO  WARRANTIES,  EXPRESS OR IMPLIED,  EITHER IN FACT OR BY  OPERATION OF LAW, BY
STATUTE OR OTHERWISE,  UNDER THIS AGREEMENT,  AND NOVADEL SPECIFICALLY DISCLAIMS
ANY OTHER WARRANTIES,  WHETHER WRITTEN OR ORAL, OR EXPRESS OR IMPLIED, INCLUDING
ANY  WARRANTY OF QUALITY,  MERCHANTABILITY  OR FITNESS FOR A  PARTICULAR  USE OR
PURPOSE  OR  ANY   WARRANTY   AS  TO

                                    Page 28
<PAGE>

THE VALIDITY OF ANY PATENTS OR THE NON-INFRINGEMENT OF ANY INTELLECTUAL PROPERTY
RIGHTS OF THIRD PARTIES UNDER THIS AGREEMENT.

                  11.5  LIMITATION OF  LIABILITY.  NONE OF NOVADEL OR ANY OF ITS
AFFILIATES  SHALL BE LIABLE FOR SPECIAL,  INDIRECT,  INCIDENTAL OR CONSEQUENTIAL
DAMAGES (INCLUDING FOR LOST PROFITS), WHETHER IN CONTRACT, WARRANTY, NEGLIGENCE,
TORT, STRICT LIABILITY OR OTHERWISE,  ARISING OUT OF (A) THE USE OF THE LICENSED
TECHNOLOGY OR LICENSED TRADEMARKS OR (B) ANY BREACH OF OR FAILURE TO PERFORM ANY
OF THE PROVISIONS OF THIS AGREEMENT.

                                   ARTICLE 12
                                   ASSIGNMENT

                  This Agreement and the rights and duties  appertaining  hereto
may not be assigned by either party without first  obtaining the written consent
of the  other  which  consent  shall  not be  unreasonably  withheld.  Any  such
purported  assignment,  without the written consent of the other party, shall be
null and of no effect.  Notwithstanding  the  foregoing,  the Company may assign
this  Agreement (i) to a purchaser,  merging or  consolidating  corporation,  or
acquiror  of  substantially  all of the  Company's  assets  or  business  and/or
pursuant to any  reorganization  qualifying  under  section 368 of the  Internal
Revenue Code of 1986 as amended, as may be in effect at such time, or (ii) to an
Affiliate of the Company  subject to the consent of the Licensors  which consent
shall not be unreasonably withheld.
ARTICLE 13
                          USE OF NAMES AND PUBLICATION

                  13.1 USE OF NAME. Nothing contained in this Agreement shall be
construed as granting any right to Licensee,  its Affiliates or  Sublicensees to
use in  advertising,  publicity,  or other  promotional  activities  the name of
NovaDel or any of its units (including  contraction,  abbreviation or simulation
of any of  the  foregoing)  without  the  prior,  written  consent  of  NovaDel;
provided,  however,  that NovaDel  acknowledges and agrees that Licensee may use
the names of NovaDel in various  documents used by Licensee for capital  raising
and financing without such prior written consent to the limited extent that such
use may be required by law,  and  provided  further  that all such uses shall be
factually accurate and not misleading.

                  13.2  RELATIONSHIP  OF THE  PARTIES.  Nothing  herein shall be
deemed to establish a  relationship  of principal and agent between  NovaDel and
Licensee, nor any of their agents or employees for any purpose whatsoever.  This
Agreement  shall not be construed as creating a partnership  between NovaDel and
Licensee,  or as creating  any other form of legal  association  or  arrangement
which would impose liability upon one Party for the act or failure to act of the
other Party.

                  13.3  PUBLICATIONS.  In the event that either party desires to
publish or disclose, by written, oral or other presentation, Licensed Technology
or any material  information  related

                                    Page 29
<PAGE>

thereto,  then such party shall notify the other in writing of its  intention at
least  sixty (60) days prior to any speech,  lecture or other oral  presentation
and at least  sixty  (60)  days  before  any  written  or other  publication  or
disclosure,  and shall  include with such notice a  description  of any proposed
oral  presentation or, with respect to any proposed written or other disclosure,
a current  draft of such proposed  disclosure  or abstract.  NovaDel may request
that  Licensee,  no later than  thirty (30) days  following  the receipt of such
notice,  delay such  presentation,  publication or disclosure in order to enable
NovaDel to file, or have filed on its behalf or jointly, as applicable, a patent
application,  copyright  or  other  appropriate  form of  intellectual  property
protection  related to the  information to be disclosed or request that Licensee
do so. Upon receipt of such request to delay such  presentation,  publication or
disclosure, Licensee shall arrange for a delay of such presentation, publication
or disclosure  until such time as Licensee or NovaDel has filed, or had filed on
its behalf,  such patent  application,  copyright or other  appropriate  form of
intellectual   property   protection   in  form  and  in  substance   reasonably
satisfactory  to NovaDel.  If Licensee  does not receive any such  request  from
NovaDel to delay such  presentation,  publication  or  disclosure,  Licensee may
submit such material for presentation,  publication or other form of disclosure.
Notwithstanding  the  foregoing,  in no event shall  Licensee  have any right to
publish or disclose  the  Licensed  Process or any  information  or data related
thereto without the prior written consent of NovaDel,  which consent NovaDel may
withhold in its sole discretion.

                                   ARTICLE 14
                   PAYMENTS, NOTICES AND OTHER COMMUNICATIONS

                  All  notices  or other  communications  that are  required  or
permitted  hereunder  shall be in  writing  and  delivered  personally,  sent by
telecopier (and promptly confirmed by personal delivery, registered or certified
mail or overnight  courier as provided  herein),  sent by  nationally-recognized
overnight  courier or sent by registered  or certified  mail,  postage  prepaid,
return receipt requested, addressed as follows:

If to NovaDel to:

         NovaDel Pharma Inc.
         31 State Highway 12
         NovaDel, NJ  08822
         Attention:  President
         908.782.3431 (fax)

         with a copy (not constituting notice) to:

         Covington & Burling
         1201 Pennsylvania Avenue, NW
         Washington, DC  20004
         Attention:  John A. Hurvitz, Esq.
         202.662.6291 (fax)

                                    Page 30
<PAGE>

If to Licensee to:

         Manhattan Pharmaceuticals, Inc.
         787 Seventh Avenue, 48th Floor
         New York, NY 10019
         Attention: President
         212.554.4355 (fax)

         with a copy (not constituting notice) to:

or to such  other  address  as the Party to whom  notice is to be given may have
furnished  to the  other  Party in  writing  in  accordance  herewith.  Any such
communication  shall  be  deemed  to have  been  given  (a) when  delivered,  if
personally  delivered  or sent  by  telecopier  on a  business  day,  (b) on the
business day after dispatch, if sent by nationally-recognized overnight courier,
and (c) on the third  business  day  following  the date of mailing,  if sent by
mail. It is understood and agreed that this Article 16 is not intended to govern
the  day-to-day  business  communications   necessary  between  the  Parties  in
performing their duties, in due course, under the terms of this Agreement.

                                   ARTICLE 15
                                 CONFIDENTIALITY

                  15.1 DEFINITION.  "Confidential  Information" of a Party shall
mean all information and know-how and any tangible  embodiments thereof provided
by or on behalf of such Party to the other Party either in  connection  with the
discussions and negotiations pertaining to, or in the course of performing, this
Agreement,  including the terms of this  Agreement;  the  Designated  Compounds;
data;  knowledge;  practices;  processes;  ideas;  research  plans;  engineering
designs and drawings;  research data;  manufacturing  processes and  techniques;
scientific,  manufacturing,  marketing  and business  plans;  and  financial and
personnel  matters  relating to the disclosing Party or to its present or future
products,  sales, suppliers,  customers,  employees,  investors or business. For
purposes  of this  Agreement,  notwithstanding  the Party  that  disclosed  such
information or know-how, all NovaDel Know-How and all Information and Inventions
with  respect to the  Licensed  Process  shall be  Confidential  Information  of
NovaDel.

                  15.2 EXCLUSIONS. Notwithstanding the foregoing, information or
know-how of a Party shall not be deemed Confidential Information with respect to
a receiving  Party for purposes of this  Agreement if such  receiving  party can
affirmatively  demonstrate through the production of written  documentation that
such information or know-how:

                       15.2.1 was already  known to the  receiving  Party or its
Affiliates, other than under an obligation of confidentiality or non-use, at the
time of disclosure to such receiving Party;

                       15.2.2  was  generally  available  or  known  to  parties
reasonably  skilled in the field to which such information or know-how pertains,
or was otherwise  part of the public  domain,  at the time of its  disclosure to
such receiving Party;

                                    Page 31
<PAGE>

                       15.2.3  became  generally  available  or known to parties
reasonably  skilled in the field to which such information or know-how pertains,
or otherwise  became part of the public  domain,  after its  disclosure  to such
receiving  Party  through no fault of a Party other than the Party that Controls
such information and know-how;

                       15.2.4  was  disclosed  to such  receiving  Party  or its
Affiliates,  other than under an obligation of confidentiality or non-use,  by a
Third Party who had no obligation  to the Party that  Controls such  information
and know-how not to disclose such information or know-how to others; or

                       15.2.5 was independently  discovered or developed by such
receiving  Party or its  Affiliates,  as  evidenced  by their  written  records,
without the use of Confidential Information belonging to the Party that Controls
such information and know-how,  except with respect to the NovaDel Know-How with
respect  to  the  Licensed  Process,  which  shall  be and  remain  Confidential
Information of NovaDel.

Specific aspects or details of Confidential  Information  shall not be deemed to
be within the public domain or in the  possession of a Party merely  because the
Confidential  Information is embraced by more general  information in the public
domain  or in  the  possession  of  such  Party.  Further,  any  combination  of
Confidential  Information shall not be considered in the public domain or in the
possession of a Party merely because  individual  elements of such  Confidential
Information  are in the public domain or in the  possession of such Party unless
the combination and its principles are in the public domain or in the possession
of such Party.

                  15.3  DISCLOSURE  AND USE  RESTRICTION.  Except  as  expressly
provided herein,  the Parties agree that during the Term of this Agreement,  and
for five (5) years  thereafter,  each Party and its Affiliates and  sublicensees
shall keep completely  confidential and shall not publish or otherwise  disclose
and shall not use for any purpose except for the purposes  contemplated  by this
Agreement any  Confidential  Information  of the other Party,  its Affiliates or
Sublicensees.

                  15.4   AUTHORIZED   DISCLOSURE.   Each   Party  may   disclose
Confidential  Information of the other Party to the extent that such  disclosure
is:

                       15.4.1 REQUIRED BY GOVERNMENTAL  ORDER.  Made in response
to a valid order of a court of competent  jurisdiction or other  supra-national,
federal,  national,   regional,  state,  provincial  or  local  governmental  or
regulatory body of competent  jurisdiction;  provided,  however, that such Party
shall  first have given  notice to such other Party and given such other Party a
reasonable  opportunity  to quash  such order and to obtain a  protective  order
requiring that the  Confidential  Information and documents that are the subject
of such order be held in confidence by such court or agency or, if disclosed, be
used only for the purposes for which the order was issued;  and provided further
that if a disclosure order is not quashed or a protective order is not obtained,
the Confidential Information disclosed in response to such court or governmental
order  shall be limited to that  information  which is  legally  required  to be
disclosed in response to such court or governmental order;

                       15.4.2  REQUIRED  BY  LAW.  Otherwise  required  by  law;
provided,  however,  that the disclosing Party shall (a) provide the other Party
with  reasonable  advance

                                    Page 32
<PAGE>

notice of and an opportunity to comment on any such required disclosure,  (b) if
requested by such other Party, seek  confidential  treatment with respect to any
such  disclosure  to the extent  available,  and (c) use good  faith  efforts to
incorporate  the comments of such other Party in any such  disclosure or request
for confidential treatment;

                       15.4.3  REQUIRED BY  REGULATORY  AUTHORITY.  Made by such
Party to the Regulatory  Authorities as required in connection  with any filing,
application  or  request  for  Regulatory  Approval;   provided,  however,  that
reasonable  measures  shall be taken to assure  confidential  treatment  of such
information; or

                       15.4.4  REQUIRED BY  AGREEMENT.  Made by such  Party,  in
connection with the performance of this Agreement, to Affiliates,  Sublicensees,
research parties,  employees,  consultants,  representatives or agents,  each of
whom prior to disclosure  must be bound by  obligations of  confidentiality  and
non-use at least equivalent in scope to those set forth in this Article 16.

                  15.5 PRESS  RELEASES.  Press  releases or other similar public
communication  by either Party relating to this Agreement,  shall be approved in
advance by the other Party, which approval shall not be unreasonably withheld or
delayed, except for those communications required by Applicable Law (which shall
be  provided  to the other  Party as soon as  practicable  after the  release or
communication  thereof),  disclosures  of  information  for  which  consent  has
previously been obtained,  and information of a similar nature to that which has
been previously disclosed publicly with respect to this Agreement, each of which
shall not require advance approval.

                                   ARTICLE 16
                            MISCELLANEOUS PROVISIONS

                  16.1 GOVERNING  LAW. This  Agreement  shall be governed by and
construed in  accordance  with the laws of the State of New York,  excluding any
conflicts  or  choice  of law  rule or  principle  that  might  otherwise  refer
construction  or  interpretation  of this  Agreement to the  substantive  law of
another jurisdiction.

                  16.2  REGISTRATION.   If  this  Agreement  or  any  associated
transaction  is  required  by the law of any  nation  to be either  approved  or
registered  with any  governmental  agency,  Licensee  shall  assume  all  legal
obligations to do so and the costs in connection therewith.

                  16.3 TRADE REGULATIONS.  Licensee shall observe all applicable
United States and foreign laws with respect to the transfer of Licensed  Product
and related  technical data to foreign  countries,  including the  International
Traffic in Arms Regulations (ITAR) and the Export Administration Regulations.

                  16.4 ENTIRE  AGREEMENT.  The Parties hereto  acknowledge  that
this  Agreement,   including  the  Appendices  and  documents   incorporated  by
reference,  sets forth the entire  agreement  and  understanding  of the Parties
hereto as to the subject matter  hereof,  and shall not be subject to any change
of modification except by the execution of a written instrument subscribed to by
the Parties hereto. This Agreement shall supersede all previous

                                    Page 33
<PAGE>

communications,  representations  or  understandings,  either  oral or  written,
between the Parties relating to the subject matter hereof.

                  16.5 SEVERABILITY.  If any provision of this Agreement is held
to be illegal,  invalid or unenforceable under any present or future law, and if
the rights or  obligations  of either  Party  under this  Agreement  will not be
materially and adversely  affected  thereby,  (a) such provision  shall be fully
severable,  (b)  this  Agreement  shall be  construed  and  enforced  as if such
illegal,  invalid or unenforceable  provision had never comprised a part hereof,
(c) the remaining  provisions of this  Agreement  shall remain in full force and
effect  and shall not be  affected  by the  illegal,  invalid  or  unenforceable
provision or by its severance herefrom, and (d) in lieu of such illegal, invalid
or unenforceable provision, there shall be added automatically as a part of this
Agreement a legal,  valid and enforceable  provision as similar in terms to such
illegal,  invalid or  unenforceable  provision as may be possible and reasonably
acceptable to the Parties herein.  To the fullest extent permitted by applicable
law,  each Party  hereby  waives  any  provision  of law that  would  render any
provision prohibited or unenforceable in any respect.

                  16.6  WAIVER.  The  failure of either  Party to assert a right
hereunder  or to  insist  upon  compliance  with any term or  condition  of this
Agreement  shall  not  constitute  a waiver  of that  right or  excuse a similar
subsequent failure to perform any such term or condition by the other Party.

                  16.7 EQUITABLE RELIEF. Each Party acknowledges and agrees that
the restrictions set forth in Articles 6 and 16 of this Agreement are reasonable
and  necessary to protect the  legitimate  interests of the other Party and that
such other Party would not have  entered  into this  Agreement in the absence of
such  restrictions,  and that  any  violation  or  threatened  violation  of any
provision  of  Article 6 and 16 may result in  irreparable  injury to such other
Party.  Each Party also acknowledges and agrees that in the event of a violation
or  threatened  violation of any  provision of Article 6 and 16, the other Party
shall be entitled to seek preliminary and permanent  injunctive relief,  without
the necessity of having to post a bond, as well as to an equitable accounting of
all earnings,  profits and other benefits  arising from any such violation.  The
rights provided in the immediately preceding sentence shall be cumulative and in
addition to any other  rights or remedies  that may be  available  to such other
Party.  Nothing in this  Section 16.7 is intended,  or should be  construed,  to
limit such other Party's right to preliminary and permanent injunctive relief or
any other remedy for breach of any other provision of this Agreement.

                  16.8 FORCE  MAJEURE.  Neither  Party  shall be held  liable or
responsible to the other Party or be deemed to have defaulted  under or breached
this Agreement for failure or delay in fulfilling or performing any term of this
Agreement  when such failure or delay is caused by or results from causes beyond
the reasonable control of the  non-performing  Party,  including fires,  floods,
earthquakes,  embargoes,  shortages,  epidemics,  quarantines,  war, acts of war
(whether war be declared or not), acts of terrorism, insurrections, riots, civil
commotion,  strikes, lockouts or other labor disturbances,  acts of God or acts,
omissions or delays in acting by any governmental authority.  The non-performing
Party shall  notify the other Party of such force  majeure  within ten (10) days
after such  occurrence by giving  written  notice to the other Party stating the
nature of the event,  its  anticipated  duration,  and any action being taken to
avoid or minimize  its effect.  The  suspension  of  performance  shall be of no
greater scope and no longer  duration  than is

                                    Page 34
<PAGE>

necessary and the non-performing Party shall use commercially reasonable efforts
to remedy its  inability to perform;  provided,  however,  that in the event the
suspension of performance  continues for one-hundred and eighty (180) days after
the date of the  occurrence,  and such  failure to perform  would  constitute  a
material  breach of this  Agreement  in the absence of such force  majeure,  the
non-performing  Party may terminate this Agreement pursuant by written notice to
the other Party.

                  16.9   CONSTRUCTION.   Except  where  the  context   otherwise
requires,  wherever used, the singular shall include the plural,  the plural the
singular,  the use of any gender shall be applicable to all genders and the word
"or" is used in the inclusive sense (and/or). The captions of this Agreement are
for  convenience  of reference  only and in no way define,  describe,  extend or
limit  the  scope or intent of this  Agreement  or the  intent of any  provision
contained  in this  Agreement.  The term  "including"  as used herein shall mean
including,  without  limiting the generality of any  description  preceding such
term. The language of this Agreement shall be deemed to be the language mutually
chosen  by the  Parties  and no rule of  strict  construction  shall be  applied
against either Party hereto.

                  16.10  FURTHER  ASSURANCE.  Each Party shall duly  execute and
deliver,  or cause to be duly executed and delivered,  such further  instruments
and do and cause to be done such further acts and things,  including  the filing
of such assignments,  agreements, documents and instruments, as may be necessary
or as the other Party may reasonably  request in connection  with this Agreement
or to carry out more  effectively  the  provisions  and  purposes,  or to better
assure and  confirm  unto such other  Party its rights and  remedies  under this
Agreement.

                  16.11  EXPENSES.   Each  of  Licensee  and  NovaDel  shall  be
responsible for their own expenses  relating to the  negotiation,  execution and
performance of this Agreement.

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

                  16.13 BINDING.  This  Agreement  shall not be binding upon the
Parties until it has been signed below on behalf of each Party,  in which event,
it shall be effective as of the Effective Date.

                                    Page 35
<PAGE>

     IN WITNESS  WHEREOF,  the duly  authorized  officers  of the  Parties  have
executed  this  Agreement  as of the  dates  set forth  below  their  respective
signatures.

<TABLE>
<CAPTION>
<S>                                            <C>
NOVADEL PHARMA INC.                            MANHATTAN PHARMACEUTICALS, INC.

By: /s/  Gary A. Shangold                     By: /s/  Leonard Firestone
   -----------------------------------------    -------------------------------------------
Name: Gary A. Shangold                        Name: Leonard Firestone

Title: President and Chief Executive Officer  Title: President and Chief Executive Officer

Date: April 8, 2003                           Date: April 4, 2003

</TABLE>

     [Pursuant  to  Item 601(b)(2) of Regulation S-K, the exhibits and schedules
     have  been  omitted from this agreement. The Registrant will furnish a copy
     of  any  omitted  schedule  or  exhibit  to  the  Commission upon request.]

                                    Page 36Exhibit 10.4 -  Employment Agreement

                               EMPLOYMENT AGREEMENT

EMPLOYMENT AGREEMENT (the "Agreement") between World Information Technology
Inc., a Nevada corporation (the "Company") and Gary D. Morgan (the
"Executive"), dated as of this 24th day of July, 2003 (the "Effective Date").

                                   RECITALS

A. The Company desires to employ Executive as the Chief Executive Officer of
the Company and the Executive is willing to accept such employment and render
such services, all upon and subject to the terms and conditions contained in
this Agreement;

B. The Company also wishes to nominate the Executive to serve as the Chairman
of the Company's Board of Directors ("Board") and the Executive is willing to
accept such nomination; and

C. References to the Company throughout this Agreement shall include the
Company and all of its affiliates.

NOW, THEREFORE, in consideration of the premises and the respective covenants
and agreements of the parties herein contained, and intending to be legally
bound hereby, the parties agree as follows:

1. Term.  The term of employment of the Executive by the Company hereunder
shall be for a period commencing as of August 1, 2003 (the "Effective Date")
and ending on December 31, 2006 (the date on which this Agreement shall expire,
as such date maybe extended in accordance with the terms of this Section 1 is
hereinafter referred to as the "Expiration Date"). Subject to the terms of
Section 6, unless the Executive or the Company gives written notice to the
other party of its desire to terminate this Agreement at least one year before
the Expiration Date, commencing on December 31, 2005 (the "Termination
Notification Date"), this Agreement will be automatically extended for further
period(s) of one year from the then current Expiration Date (the "Extended
Period") on the same terms and conditions as herein set forth. Except when the
contrary is indicated, the phrase "the term of this Agreement" or the "Term"
shall henceforth be deemed to include the Extended Period.

2. Engagement of Executive.  The Company agrees to employ the Executive and the
Executive accepts employment as Chairman and Chief Executive Officer of the
Company.

3. Duties and Powers.

During the Term, the Executive will serve in the position described in Section
2 above and will have such responsibilities, duties and authorities and will
render such services of an executive and administrative character not
inconsistent with those normally given to a Chairman and Chief Executive
Officer of a public corporation, all in accordance with the terms and
conditions of this Agreement and the business plan and capital budgets of the
Company to be developed by the Executive and the Board and to be approved by
the Board, on or before August 30,2003.  Executive shall devote Executive's best
efforts, energies and abilities and Executive's

                                         1

<PAGE>

to full business time, skill and attention to the business and affairs of the
Company and its affiliates. Executive shall perform the duties and carry out
the responsibilities assigned to the Executive to the best of the Executive's
ability, in a diligent, trustworthy, businesslike and efficient manner for the
purpose of advancing the business of the Company and its affiliates and shall
adhere to any and all of the employment policies of the Company. Executive
acknowledges that Executive's duties and responsibilities will require
Executive's full-time business efforts and agrees that during the Employment
Period Executive will not engage in any other business activity or have any
business pursuits or interests which interfere or conflict with the performance
of Executive's duties hereunder, provided, that nothing in this Section 3 shall
be deemed to prohibit Executive from: (i) serving as a director or officer or
both of such not-for-profit corporations as he may desire, joining and
participating in such committees for community or national affairs as he may
select and joining and serving on business corporation boards of directors and
engaging in other activities; or (ii) investing in stock of any corporation
listed on a national securities exchange or traded in the over-the-counter
market, but only if Executive and its associates (as such term is defined in
Regulation 14A promulgated under the Exchange Act), and the Executive's
affiliates collectively do not own more than an aggregate of five percent of
the stock of such corporation.

4. Compensation.

(a) Annual Base Salary. During the Term, the Executive shall receive a base
salary at the rate of$1.00 per annum {the "Annual Base Salary"), which shall be
paid on the signing of this Agreement and yearly on the anniversary thereof.
The Executive shall be eligible for periodic salary increases, but not
decreases, as determined in the sole discretion of the Executive Compensation
Committee of the Board (the "Committee"). Unless increased by the Committee in
its sole discretion, the Annual Base Salary shall apply for each year during
the Term. Any increase in Annual Base Salary shall not serve to limit or reduce
any other obligation to the Executive under this Agreement. The Annual Base
Salary shall not be reduced after any such increase and the term Annual Base
Salary as utilized in this Agreement shall refer to Annual Base Salary as so
increased.

(b) Signing Bonus. Upon execution of this Agreement, the Executive shall
receive 500,000 warrants to acquire shares of common stock of the Company on
terms and conditions described in the form of Warrant attached hereto as
Exhibit A.

(c)  Except as provided herein, in each fiscal year of the Company ending
during the Term, the Executive shall be eligible to participate in such bonus
programs as are available to senior executives of the Company and the award to
the Executive shall not be less than the award given to any other employee of
the Company.

(d) Performance Bonuses. The following bonuses shall be paid to the Executive
by the Company:

(i) At the end of each quarter during the Term, the Executive shall be entitled
to a bonus equal to 2% of the increase in earnings before taxes, interest,
depreciation and amortization ("EBITDA ") of the Company over the EBITDA in the
prior quarter. EBITDA shall be as set forth on the financial statements of the
Company, as prepared by its independent certified public accountants, and filed
with the U.S. Securities and Exchange

                                          2

<PAGE>

Commission. The calculation of such bonus shall be made within 20 days of the
end of each quarter and shall be deferred until 12 months after the end of each
quarter.  The payment of each such bonus will be deferred for 12 months and will
paid in accordance with the terms of a convertible note agreement (the
"Convertible Note Agreement") for the principal amount of the bonus with
interest thereon at the rate of six percent per annum and granting to the
Executive the right to convert the whole or part of the principal and interest
under such note into shares of common stock of the Company at a conversion
price of $4.00 per share or 50% of the closing bid price on the conversion
date, whichever is the lowest share price yielding the most conversion shares,
subject to adjustment as herein provided ( as elected by Executive ). The
obligations under each such Convertible Note Agreement will be evidenced by a
promissory note to be attached as an exhibit to the Convertible Note Agreement.
Each Convertible Note Agreement (together with the promissory note evidencing
the obligations under such Convertible Note Agreement) shall be in the form
attached hereto as Exhibit B;

(ii) The Company shall pay the Executive (A) on September 30,2003, a bonus (the
"Initial Market Cap Bonus") in an amount equal to 3% of the difference between
the average closing value of the Market Capitalization of the Company for the
20 days before the end such calendar quarter and a Market Capitalization (as
defined below) of $100 million and (B) at the end of every calendar quarter
thereafter, a bonus (the "Market Cap Bonus") in an amount equal to 3% of the
difference between the average closing value of the Market Capitalization of
the Company for the 20 days preceding the end of such quarter (a "Second
Value") and the average closing value of the Market Capitalization of the
Company for the 20 days preceding the beginning of such quarter (a "First
Value"); provided that a First Value used for the calculation of a Market Cap
Bonus shall never be lower than the higher of (x) $100 million or (y) any
Second Value used for a calculation of a Market Cap Bonus in the preceding
calendar quarter and provided further that if in any quarter, the difference
between the Second Value and the First Value is a negative number, the Company
shall not have any obligation to pay the Executive any Market Cap Bonus for
such quarter.  At the election of the Executive, (i) the Initial Market Cap
Bonus and the Market Cap Bonus shall be payable in cash Within 45 days of the
quarter end or (ii) the parties Will execute and exchange a Convertible Note
Agreement in the amount of the Initial Market Cap Bonus and the Market Cap
Bonus, as applicable, with interest at the rate of 6% per annum and payable
within 12 months of each quarter end; and

(iii) In the event that during the Term the Company is listed in the American
or new York Stock Exchange, the NASDAQ National Market or small cap list (the
"Listing"), the Company shall pay the Executive a bonus (the "Listing Bonus")
in an amount equal to 2% of the increase in the Market Capitalization between
the a Market Capitalization of $100 million (the "Initial Market Cap ") and the
average Market Capitalization of the Company for the 20 days after the Listing.
At the election of the Executive, (i) the Listing Bonus shall be payable in
cash within 45 days of the Listing or (ii) the parties will execute and
exchange a Convertible Note Agreement in the amount of the Listing Bonus With
interest at the rate of 6% per annum and payable within 12 months of the
Listing; and

(iv) Upon each receipt, during the Term, by the Company of any debt or equity
financing, public of private or any refinancing of debt financing, (a

                                           3

<PAGE>

to ("Financing") the Company shall pay the Executive a bonus (the "Financing
Bonus") equal to 3% of the sum of such financing. The Executive may elect to
receive the Financing Bonus in shares of common stock of the Company at a value
of$4.00 per share or in cash. The payment of the Financing Bonus by the Company
to the Executive shall occur concurrently with the closing of the Financing.
F or the purpose of this Agreement, the Market Capitalization shall mean the
value of the Company as determined by the closing market price of its issued
and outstanding common stock on the principal exchange on which such securities
are traded and shall be calculated by multiplying the number of outstanding
shares of the Company (including shares reserved for the exercise of warrants,
options and convertible instruments issued by the Company and as represented in
its financial statements) by the closing market price of a share of the common
stock of the Company.

(e) Benefits. During the Term, the Executive (i) shall be entitled to
participate in all employee benefit plans which any senior executive management
officer of the Company is entitled to participate in (subject to, and on a
basis consistent with, the terms, conditions and overall administration of such
plans, programs and arrangements) and shall not be entitled to a lesser grant
of rights which any other employee of the Company receives under any such
employee benefit plans; (ii) shall receive and participate in all profit
sharing, incentive compensation, 40lK plans and pension benefits and executive
retirement and supplemental benefits ( collectively, "Pension Benefits") which
are available to any other senior executive management officer of the Company;
and (iii) shall receive health insurance programs, executive medical and dental
benefits, life insurance, accidental death and dismemberment benefits plus such
other benefits which are available to the senior executive management of the
Company (collectively, "Welfare Benefits") which are generally available to
other senior executives officers of the Company.

(f) Stock Options.  The Executive shall be eligible for annual grants of stock
options as determined in the sole discretion of the Committee, subject to such
terms and conditions as the Committee deems appropriate; provided that in no
event the Executive shall be granted less stock options than the number of
options granted to any other senior management officer of the Company.
Notwithstanding any other agreement to the contrary, but subject to the terms
of this Agreement: (i) any stock options granted to the Executive during the
Term shall continue to vest after the expiration of the Term; and (ii) if the
Executive's employment terminates upon expiration of the Term on or after the
Final Date, he will be treated with regard to all stock options as a "retiree."
(g) Reimbursement for Expenses.  During the Term, the Executive shall be
entitled to receive non accountable business expenses in the amount of
$9,000.00 per month, payable on the first day of each calendar month during the
Term.  The Company shall reimburse the Executive for all professional fees and
costs related to the preparation and enforcement of this Agreement including
legal and accounting fees.  The Company shall also reimburse the Executive for
of all reasonable business-related expenses, including without limitation,
First-Class air travel or chartered aircraft.  At the discretion of Executive
he shall be reimbursed for immediate family members who join him on business
trips.  The Company will pay for Executive all membership dues and related
ongoing costs of appropriate club and professional organizations and dues,

                                           4

<PAGE>

to costs and expenses for continuing professional education, financial and
legal counseling, planning and administration (including any reasonable
directors and officers liability insurance coverage). The Company shall
purchase a variable life insurance policy on Executive's life, payable to
Executive's designated beneficiary, in the face amount of $10,000,000. Company
shall also establish a bonus arrangement to enable a "roll-out" of the policy
on a tax-free basis to Executive at his targeted retirement date, as defined by
Executive in writing. In the event of a termination of employment prior to
retirement, Executive shall be entitled to receipt of the policy and a bonus in
the amount required to cover all applicable income taxes on such transfer,
fully grossed up.

(h) Office and Support Staff.  During the Term, the Executive shall be provided
with an appropriate office in the City of New York, together with a conference
room in such same location, and with such secretarial and other support
facilities as are commensurate with his position as Chief Executive Officer and
Chairman of the Company.

(i) Vacation. During the Term, the Executive shall be entitled to 6 weeks of
paid vacation per year.

(j) Insurance; Indemnification. During the Term and thereafter while the
Executive could have any liability, the Executive shall be named as an insured
party in any liability insurance policy (including any director and officer
liability policy) which shall be maintained by the Company for its directors
and/or senior executive officers.  In addition, the Company shall execute and
deliver to Executive, concurrently herewith, the separate indemnification
agreement attached hereto as Exhibit C.

(k) Special Enterprise Enhancement Payment Award.  In addition to any other
compensation paid to Executive pursuant to this Agreement or otherwise awarded
to Executive by the Compensation Committee of the Company's Board of Directors,
Executive will receive a Special Enterprise Enhancement Payment ( the " A ward
") described in this Section ( 4 ) (k), The A ward will be paid within 30 days
after the closing of an event (an "Event") that constitute a Change in Control
of the Company and that is consummated during the Term or one year thereafter.
The amount of the A ward shall be equal to 1.5% of the higher of (i) the
Initial Market Cap, {ii) the average closing value of the Market Capitalization
of the Company for the 20 days before the Event; or (iii) the per share price
allocated to the shares of the Company in any documents executed by the Company
in connection with an Event. F or purposes of this Agreement "Change in
Control" shall mean:

(i) , The acquisition ( other than from Company) by any person, entity or
"group," within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act
(excluding, for this purpose, any employee benefit plan of Company or its
subsidiaries which acquires beneficial ownership of voting securities of
Company) of beneficial ownership (within the meaning of Rule 13 d- 3
promulgated under the Exchange Act) of 40% or more of either the then
outstanding shares of Common Stock or the combined voting power of Company's
then outstanding voting securities entitled to vote generally in the election
of directors; or

(ii) Individuals who, as of the date hereof, constitute the Board of Directors
of the Company cease for any reason to constitute at least a majority of the
Board; or

                                        5

<PAGE>

(iii) Approval by the stockholders of Company of the consummation of a
reorganization, merger or consolidation or sale or other disposition of all or
substantially all of the assets of the Company (a "Business Combination"), in
each case, unless, following such Business Combination all or substantially all
of the individuals and entities who were the beneficial owners, respectively,
of the outstanding voting stock of the Company immediately prior to such
Business Combination beneficially own, directly or indirectly, more than 40%
of, respectively, the then outstanding shares of common stock or the combined
voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the corporation
resulting from such Business Combination {including, Without limitation, a
corporation which as a result of such transaction owns the Company or all or
substantially all of the Company's assets either directly or through one or
more subsidiaries) in substantially the same proportions as their ownership,
immediately prior to such Business Combination.

5. Termination of Employment.

(a) Death or Disability. The Executive's employment shall terminate upon the
death of the Executive during the Term; provided, however, his estate shall be
entitled to receive the bonuses set forth in Section 4(c) for a period of one
year after his death. If it is determined that the Disability of the Executive
has occurred during the Term (pursuant to the definition of Disability set
forth below), the Company may give to the Executive written notice in
accordance with Section l4(c) of this Agreement of its intention to terminate
the Executive's employment. In such event, the Executive's employment with the
Company shall terminate effective on the 30th day after receipt of such notice
by the Executive (the "Disability Effective Date"), provided that, within the
30 days after such receipt, the Executive shall not have resumed performance of
any of his duties. Prior to the Disability Effective Date, the Executive shall
continue to be treated as if fully and actively employed by the Company for
purposes of this Agreement, and without respect to whether or not the Executive
is or is determined to be Disabled. For purposes of this Agreement,
"Disability" shall mean the absence of the Executive from the Executive's
duties with the Company for 180 consecutive business days as a result of
incapacity due to mental or physical illness which is determined to be total
and permanent by a physician selected by the Executive or spouse of the
Executive and reasonably acceptable to the Company.

(b)  By the Company.

(i) For Cause. The Company may terminate the Executive's employment during the
Term for Cause. For purposes of this Agreement, "Cause" shall mean:

(1) the Executive's conviction of, or plea of nolo contendere to, any felony
(other than vicarious liability which results solely from Executive's position
as Chief Executive Officer, provided that Executive did not know, or should not
have known, of any act or failure to act upon which such conviction or plea is
based, or knew, but acted on the advice of counsel);

                                           6

<PAGE>

(2)  the Executive's willful misconduct with regard to the Company having a
material and demonstrable adverse effect on the financial condition of the
Company and its subsidiaries, as a whole; provided that the Executive is given
the opportunity to cure the same within 30 days after receipt of a detailed
notice setting forth the particulars of the acts and how they materially and
adversely effect the Company and its subsidiaries and further subject to the
text following sub clause

(3)  the Executive's failure to attempt to adhere to, or take affirmative steps
to carry out, any legal and proper directive of the Board, after receipt of
written notice from the Board and a reasonable opportunity to cure such non-
adherence or failure to act.

The termination of Executive's employment shall not be deemed to be for Cause
unless and until there shall have been delivered to the Executive a copy of a
resolution duly adopted by the affirmative vote of not less than three-
quarters of the entire membership of the Board at a meeting of the Board called
and held for such purpose (after reasonable notice is provided to the Executive
and the Executive is given an opportunity, together with counsel, to be heard
before the Board), finding that, in the good faith opinion of the Board, the
Executive is guilty of the conduct described in subparagraph (1 ), (2) or (3)
above, and specifying the particulars thereof in detail.  For purposes of this
Agreement, no act, or failure to act, on Executive's part shall be considered
willful unless done, or omitted to be done, by Executive in bad faith and
without reasonable belief that Executive's act or failure to act was in the
Company's best interests. Any act, or failure to act, based upon authority
granted pursuant to a duly adopted Board resolution or advice of counsel shall
be conclusively presumed to be done, or omitted to be done, by Executive in
good faith and in the Company's best interests.

(c) By the Executive.

(i) Without Good Reason.  The Executive may terminate employment under this
Agreement by giving Notice of Termination to the Company in accordance with
Section 14(c) of this Agreement no less than 2 months prior to such
termination, unless such termination is pursuant to Section (5)(c)(ii) below,
or the Company elects to waive or reduce such notice requirement.

(ii) With Good Reason. The Executive's employment maybe terminated by the
Executive for Good Reason. For purposes of this Agreement, "Good Reason" shall
mean:

(1) except as contemplated in Section 3 of this Agreement, any diminution in
the Executive's title or position or material diminution in authority, duties
or responsibilities as set forth herein;

                                           7

<PAGE>

(2)  the assignment of any duties or responsibilities to the Executive that are
not commensurate with the Executive's title, authority or position as set forth
herein;

(3)  a decrease in Annual Base Salary or Employee Benefits;

(4)  any material diminution of benefits described in Sections 4(b),(c), (d)
(e), (f), (g), (h),or(i) of this Agreement; .or

(5)  any material breach of this Agreement by the Company after written notice
from the Executive and a reasonable opportunity for the Company to cure such
breach.

For purposes ofthisSection5(c)(ii), any good faith determination of "Good
Reason" made by the Executive following a Change of Control shall be
conclusive.

(d)  Notice of Termination.  Any termination by the Company for Cause, or by
the Executive, shall be communicated by Notice of Termination to the other
party hereto given in accordance with Section 14(c) of this Agreement For
purposes of this Agreement, a "Notice of Termination" means a written notice
which (i) indicates the specific termination provision in this Agreement relied
upon, (ii) to the extent applicable, 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 and (iii) if the Date of
Termination (as defined below) is other than the date of receipt of such
notice, specifies the termination date {which date shall be not more than
thirty days after the giving of such notice ). The failure by the Executive or
the Company to set forth in the Notice of Termination any fact or circumstance
which contributes to a showing of Good Reason or Cause shall not waive any
right of the Executive or the Company, respectively, hereunder or preclude the
Executive or the Company, respectively, from asserting such fact or
circumstance in enforcing the Executive's or the Company's rights hereunder.

(e) Date of Termination. "Date of Termination" means (i) if the Executive's
employment is terminated by the Company for Cause, or by the Executive for Good
Reason, the date of receipt of the Notice of Termination or any later date
specified therein, as the case may be, {ii) if the Executive's employment is
terminated by the Executive without Good Reason, the Date of Termination shall
be 2 months after the date on which the Executive notifies the Company of such
termination ( or such earlier date if approved by the Company),
respectively, {iii) if the Executive's employment is terminated by reason of
death or Disability, the Date of Termination shall be the date of death of the
Executive or the Disability Effective pate, as the case may be.

6. Obligations of the Company upon Termination

                                         8

<PAGE>

(a) Good Reason.  If, during the Term, the Executive shall terminate employment
for Good Reason:

(i) the Company shall pay to or for the Executive, on the same dates he would
have received the same if employment was no so terminated, amounts equal to :
(1) the Executive's Annual Base Salary through the end of the original
Expiration Date or the Extended Period (if this Agreement was extended pursuant
to Section 1 hereto); and (2) any bonus earned during prior fiscal years but
not yet paid to Executive and bonus payments for each year until the original
Expiration Date or the Extended Period (if this Agreement was extended pursuant
to Section 1 hereto); (3) all benefits set forth in Section 4, inclusive of,
but pot limited to Pension Benefits, Welfare Benefits and Other Benefits; and
(4) any compensation previously deferred by the Executive (together with any
accrued interest or earnings thereon) and any accrued vacation pay, in each
case to the extent not theretofore paid (the sum of the amounts and benefits
described in clauses (1), (2), (3) and (4) shall be hereinafter referred to as
the " Accrued Obligations");

(ii) the Company shall treat the Executive as a "retiree" with respect to
treatment of his outstanding stock options, as well as with respect to
participation in all employee benefit plans;

(iii) to the extent not theretofore paid or provided, the Company shall timely
payor provide to the Executive any other amounts or benefits required to be
paid or provided or which the Executive is eligible to receive under any plan,
program, policy or practice or contractor agreement of the Company (such, other
amounts and benefits shall be hereinafter referred to as the "Other Benefits").

(b) Death.  If the Executive's employment is terminated by reason of the
Executive's death during the Term, this Agreement shall terminate without
further obligations to the Executive's legal representatives under this
Agreement, other than for payment of (l) the Executive's Annual Base Salary;
(2) any bonus earned during prior fiscal years but not yet paid to Executive
and any bonus payments until the first year anniversary of the Date of
Termination; and (3) any compensation previously deferred by the Executive
(together with any accrued interest or earnings thereon) and any Accrued
Obligations and the timely payment or provision of Other Benefits. The payment
obligations described in this Subparagraph (c) shall be paid to the Executive's
estate or beneficiary, as applicable, in a lump sum in cash within 30 days of
the Date of Termination.

(c) Disability. If the Executive's employment is terminated by reason of the
Executive's Disability during the Term, this Agreement shall terminate without
further obligations to the Executive, other than for payment of Accrued
Obligations and the timely payment or provision of other Benefits. Accrued
Obligations shall be paid to the Executive on the same dates as if employment
was not terminated by reason of Disability. The Welfare Benefits and Fringe
Benefits shall continue through the Welfare Protection Period.

(d) Other than for Good Reason.  If Executive voluntarily terminates employment
during the Term (excluding a termination for Good Reason), this Agreement shall
terminate without further obligations to the Executive's legal representatives
under this

                                         9

<PAGE>

Agreement, other than for payment of (l) the unpaid Executive's Annual Base
Salary; (2) any bonus earned during prior fiscal years but not yet paid to
Executive; (3) any compensation previously deferred by the Executive (together
with any accrued interest or earnings thereon) and any accrued vacation pay
Accrued Obligations and the timely payment or provision of Other Benefits; and
(4) Welfare Benefits for the Executive and his family for a period of two
years after the Date of Termination.  The payment obligations described in this
Subparagraph (d) shall be paid to the Executive in a lump sum in cash within 30
days of the Date of Termination.

(e) Cause: Other than for Good Reason.  If the Executive's employment shall be
terminated for Cause during the Term, this Agreement shall terminate without
further obligations to the Executive other than the obligation to pay to the
Executive (i) his Annual Base Salary through the Date of Termination, (ii) the
amount of any compensation previously deferred by the Executive, and (iii)
Other Benefits, in each case to the extent theretofore unpaid.

7.  Certain Additional Payments by the Company.

{a) Anything in this Agreement to the contrary notwithstanding and except as
set forth below, in the event it shall be determined that any payment or
distribution by the Company to or for the benefit of the Executive (whether
paid or payable or distributed or distributable pursuant to the terms of this
Agreement or otherwise, but determined without regard to an additional payments
required under this Section 7) (a "Payment") would be subject to the excise tax
imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (the
"Code") or any interest or penalties are incurred by the Executive with respect
to such excise tax (such excise tax, together with any such interest and
penalties, are hereinafter collectively referred to as the "Excise Tax")
and/or any income taxes, then the Executive shall be entitled to receive: (i)
an additional payment (a "Gross-Up Payment") in an amount such that after
payment by the Executive of all taxes (including any interest or penalties
imposed with respect to such taxes), including, without limitation~ any income
taxes (and any interest and penalties imposed with respect thereto) and Excise
Tax imposed upon the Gross-Up Payment, the Executive retains an amount of the
Gross-Up Payment equal to the Excise Tax imposed upon the Payments, and (ii) an
amount equal to the product of any deductions disallowed for federal, state or
local income tax purposes because of the inclusion of the Gross-Up Payment in
the Executive's adjusted gross income multiplied by the highest applicable
marginal rate of federal, state, or local income taxation, respectively, for
the calendar year in which the Gross-Up Payment is to be made.

(b} Subject to the provisions of Section 7(c), all determinations required to
be made under this Section 7, including whether and when a Gross-Up Payment is
required and the amount of such Gross-Up Payment and the assumptions to be
utilized in arriving at such determination, shall be made by the certified
independent accountants used by the Company for the audit of its financial
statements (the " Accounting Firm") which shall provide detailed supporting
calculations both to the Company and the Executive within 15 business days of
the receipt of notice from the Executive that there has been a Payment, or such
earlier time as is requested by the Company. All fees and expenses of the
Accounting Firm shall be borne solely by the Company.  Any Gross-Up Payment, as
determined pursuant to this Section 7, shall be paid by the Company to the
Executive within five days of the receipt of the Accounting Firm's
determination. Any determination by the Accounting Firm shall be binding upon
the Company and the Executive.  As a result of the uncertainty in the
application of Section 4999 of the Code

                                       10

<PAGE>

at the time of the initial determination by the Accounting Firm hereunder, it
is possible that Gross-Up Payments which will not have been made by the Company
should have been made ("Underpayment"), consistent with the calculations
required to be made hereunder. In the event that the Company exhausts its
remedies pursuant to Section 7(c) and the Executive thereafter is required to
make a payment of any Excise Tax, the Accounting Firm shall determine the
amount of the Underpayment that has occurred and any such Underpayment shall be
promptly paid by the Company to or for the benefit of the Executive.

(c) The Executive shall notify the Company in writing of any claim by the
Internal Revenue Service that, if successful, would require the payment by the
Company of the Gross-Up Payment. Such notification shall be given as soon as
practicable but no later than ten business days after the Executive is informed
in writing of such claim and shall apprise the Company of the nature of such
claim and the date on which such claim is requested to be paid. The Executive
shall not pay such claim prior to the expiration of the 30-day period following
the date on which it gives such notice to the Company (or such shorter period
ending on the date that any payment of taxes with respect to such claim is
due). If the Company notifies the Executive in writing prior to the expiration
of such period that it desires to contest such claim, the Executive shall:

(i)  give the Company any information reasonably requested by the Company
relating to such claim,

(ii) take such action in connection with contesting such claim as the Company
shall reasonably request in writing from time to time, including, without
limitation, accepting legal representation with respect to such claim by an
attorney reasonably selected by the Company,

(iii) cooperate with the Company in good faith in order to effectively contest
such claim, and

(iv) permit the Company to participate in any proceedings relating to such
claim; provided, however, that the Company shall bear and pay directly all
costs and expenses (including additional interest and penalties) incurred in
connection with such contest and shall indemnify and hold the Executive
harmless, on an after-tax basis, for any Excise Tax or income tax (including
interest and penalties with respect thereto) imposed as a result of such
representation and payment of costs and expenses. Without limitation on the
foregoing provisions of this Section 7(c), the Company shall control all
proceedings taken in connection with such contest and, at its sole option, may
pursue or forgo any and all administrative appeals, proceedings, hearings and
conferences with the taxing authority in respect of such claim and may, at its
sole option, either direct the Executive to pay the tax claimed and sue for a
refund or contest the claim in any permissible manner, and the Executive agrees
to prosecute such contest to a determination before any administrative
tribunal, in a court of initial jurisdiction and in one or more appellate
courts, as the Company shall determine; provided, however, that if the Company
directs the Executive to pay such claim and sue for a refund, the Company shall
advance the amount of such payment to the Executive, on an interest free basis
and shall indemnify and hold the Executive harmless, on an after-tax basis,
from any Excise Tax or income tax (including interest or penalties with respect
thereto) imposed with

                                       11

<PAGE>

respect to such advance or with respect to any imputed income with respect to
such advance; and further provided that any extension of the statute of
limitations relating to payment of taxes for the taxable year of the Executive
with respect to which such contested amount is claimed to be due is limited
solely to such contested amount.  Furthermore, the Company's control of the
contest shall be limited to issues with respect to which a Gross-Up Payment
would be payable hereunder and the Executive shall be entitled to settle or
contest, as the case may be, any other issue raised by the Internal Revenue
Service or any other taxing authority.

(d)  If, after the receipt by the Executive of an amount advanced by the
Company pursuant to Section 7(c), the Executive becomes entitled to receive any
refund with respect to such claim, the Executive shall (subject to the
Company's complying with the requirements of Section 7(c) promptly pay to the
Company the amount of such refund (together with any interest paid or credited
thereon after taxes applicable thereto ). If, after the receipt by the
Executive of an amount advanced by the Company pursuant to Section 7(c), a
determination is made that the Executive shall not be entitled to any refund
with respect to such claim and the Company does not notify the Executive in
writing of its intent to contest such denial of refund prior to the expiration
of 30 days after such determination, then such advance shall be forgiven and
shall not be required to be repaid and the amount of such advance shall offset,
to the extent thereof, the amount of Gross- Up Payment required to be paid.

8. Registration Rights. The Company agrees that it will, at the request of
Executive, effect a registration statement with respect to the Convertible Note
Agreement and the underlying shares, pursuant to an effective registration
statement under the Securities Act of 1933 (as now in effect or as hereafter
amended) pursuant to a registration statement of Form S-4 or Form S-8 or any
successor or similar form.

9. Non-exclusivity of Rights. Nothing in this Agreement shall prevent or limit
the Executive's continuing or future participation in any plan, program, policy
or practice provided by the Company and for which the Executive may qualify,
nor shall anything herein limit or otherwise affect such rights as the
Executive may have under any contractor agreement with the Company. Amounts
which are vested benefits or which the Executive is otherwise entitled to
receive under any plan, policy, practice or program of or any contractor
agreement with the Company at or subsequent to the Date of Termination shall be
payable in accordance with such plan, policy, practice or program or contract
or agreement except as explicitly modified by this Agreement.

10. Entire Agreement.  This Agreement and other documents executed concurrently
herewith or referred to herein contain the sole and entire agreement and
understanding of the parties and supersedes all prior oral understandings or
agreements with respect to the subject matters contained herein.

11. Confidentiality;  Nondisparaqement.

(a) While employed by the Company and for a period of one year thereafter, the
Executive shall not, without the prior written consent of the Company, disclose
to anyone (except in good faith in the ordinary course of business to a person
who will be advised by the Executive to keep such information confidential) or
make use of any Confidential

                                          12

<PAGE>

Information (as defined below) except in the performance of his duties
hereunder, or when required to do so by legal process by any governmental
agency having supervisory authority over the business of the Company or by any
administrative or legislative body (including a committee thereof) or judicial
authority of law that require him to divulge, disclose or make accessible such
Confidential Information. In the event that the Executive is so ordered, he
shall give prompt written notice to the Company to allow the Company the
opportunity to promptly object to or otherwise resist such order, provided,
however, the Executive may disclose such Confidential 1nformation if the
failure to disclose would result in a penalty or assessment against him.

(b) "Confidential Information" shall mean all information concerning the
business of the Company or any Subsidiary (as defined below) relating to any of
their products, product development, trade secrets, customers, suppliers,
finances, and business plans and strategies. Excluded from the definition of
Confidential Information is information (i) that is or becomes part of the
public domain, other than through the breach of this Agreement by the Executive
or (ii) regarding the Company's business or industry properly acquired by the
Executive in the course of his career as an executive in the Company's industry
and independent of the Executive's employment by the Company. For this purpose,
information known or available generally within the trade or industry of the
Company or any Subsidiary shall be deemed to be known or available to the
public.

(c) "Subsidiary" shall mean any corporation controlled directly or indirectly
by the Company, as control is defined in Rule 405 of the Securities Act of1933,
as amended.

(d) While employed by the Company and thereafter, the Executive agrees that he
will not make public statements or representations, or otherwise communicate,
directly or indirectly, in writing, orally, or otherwise, or take any action
(except as Executive reasonably believes is necessary in the course of
performing his duties) which may, directly or indirectly, disparage the Company
or any Subsidiary or their respective officers, directors, employees, advisors,
businesses or reputations. The Company agrees that, while the Executive is
employed by the Company and thereafter, the Company will not make statements or
representations, or otherwise communicate, directly or indirectly, in writing,
orally, or otherwise, or take any action which may, directly or indirectly,
disparage the Executive or his business or reputation. Notwithstanding the
foregoing, nothing in this Agreement shall preclude either the Executive or the
Company from making truthful statements or disclosures that are required by
applicable law, regulation or legal process.

12. Non-competition and Non-solicitation.

(a) While employed by the Company and for a period of one year thereafter (the
"Restricted Period"), the Executive shall not engage in Competition with the
Company or any Subsidiary. "Competition" shall mean engaging in any activity,
except as provided below, for a Competitor of the Company or any Subsidiary,
whether as an employee, consultant, principal, agent, officer, director,
partner, shareholder (except as a less than three percent shareholder of a
publicly traded company) or otherwise (together "Employment"). A "Competitor"
shall mean any corporation or other entity which derives at least 35% or more
of its revenues from the conduct of business which competes, directly or
indirectly, with the

                                   13

<PAGE>

business conducted by the Company, as determined on the Date of Termination of
the Executive's employment unless the Executive does not oversee or manage
activities of such entity which are competitive with activities of the Company
or Subsidiary.  If the Executive commences Employment with any entity that is
not a Competitor at the time the Executive initially becomes employed or
becomes a consultant, principal, agent, officer, director, partner, or
shareholder of the entity, future activities of such entity shall not result in
a violation of this provision unless (i) such activities were contemplated by
the Executive at the time the Executive initially commenced Employment or (ii)
the Executive commences overseeing or managing the activities of an entity
which becomes a Competitor during the Restricted Period, which activities are
competitive with the activities of the Company or Subsidiary .  In addition,
the Executive may be employed by, or otherwise associated with, non-competing
portions of the competing entity so long as he does not oversee, manage or
contribute to the competing activities of the Competitor.  The Executive shall
not be deemed to be overseeing, managing or contributing to the Competitor's
activities which are competitive with the activities of the Company or
Subsidiary so long as he does not regularly participate in any discussions with
regard to the conduct of, or take any act intended to facilitate the success
of, the competing business.

(b) Notwithstanding the foregoing Section 12(a), in the event that during the
Restricted Period the Executive desires to accept Employment with a Competitor
which, in the Executive's reasonable judgment, competes with an insignificant
portion of the business conducted by the Company or Subsidiary, the Executive
shall have the right, prior to accepting such Employment, to submit a written
request to the Company for a limited waive of the Company's right to enforce
the provisions of this Section 12; which the Company shall not unreasonably
withhold it consent to the limited waiver. If the Company determines, in its
good faith reasonable judgment, that the Executive's proposed Employment with
the Competitor would not result in more than an insignificant level of
competition with the business conducted by the Company or Subsidiary at either
the time such request is made or in the then foreseeable future, the Company
shall grant the Executive the requested waiver.

(c) During the Restricted Period, the Executive shall not induce employees of
the Company or any Subsidiary to terminate their employment, nor shall the
Executive solicit or encourage any corporation or other entity in a joint
venture relationship, directly or indirectly, with the Company or any
Subsidiary, to terminate or diminish their relationship with the Company or any
Subsidiary or to violate any agreement with any of them. During such period,
the Executive shall not hire, either directly or through any employee, agent or
representative, any employee of the Company or any Subsidiary or any person who
was employed by the Company or any Subsidiary within 90 days of such hiring.

(d) The Executive's compliance with the non-competition and non-solicitation
provisions of this Section 12 shall be deemed compliance with any ether non-
competition or non-solicitation provision agreed to between .the Executive and
the Company, including but not limited to any stock option or equity grants.

(f) As an inducement to the Executive to make the undertakings in this Section
12 and as consideration to him for the undertakings as relates to the one year
after his employment hereunder has terminated, the Company shall pay to him,
during such one year period the average of the Annual Base Salary and bonuses
paid to him for the fiscal year

                                         14

<PAGE>

immediately preceding the termination of his employment, at the same times and
dates as if he was employed by the Company.

13. Successors.

This Agreement is personal to the Executive and without the prior written
consent of the Company shall not be assignable by the Executive otherwise than
by will or the laws of descent and distribution. This Agreement shall inure to
the benefit of and be enforceable by the Executive's legal representatives.

(a) This Agreement shall inure to the benefit of and be binding upon the
Company and its successors and assigns.

(b) The Company will require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of
the business and/ or assets of the Company to assume expressly and agree to
perform this Agreement in the same manner and to the same extent that the
Company would be required to perform it if no such succession had taken place.
As used in this Agreement, "Company" shall mean the Company as hereinbefore
defined and any successor to its business and/or assets as aforesaid which
assumes and agrees to perform this Agreement by operation of law, or otherwise.

14. Full Settlement:  No Mitigation: No Offset.  The Company's obligation to
make the payments provided for in this Agreement and otherwise to perform its
obligations hereunder shall not be affected by any set-off, counterclaim,
recoupment, defense or other claim, right of action which the Company may have
against the Executive or others.  In the event of any termination of
employment, the Executive shall be under no obligation to seek other
employment, and amounts due the Executive under this Agreement shall not be
offset by any remuneration attributable to any subsequent employment that he
may maintain other than substantially comparable welfare benefits provided by a
new employer .

15. Remedies. If the Executive materially breaches any of the provisions
contained in Sections 11 or 12 above, the Company shall have the right to
immediately seek injunctive relief The Executive acknowledges that such a
breach of Sections 11 or 12 would cause irreparable injury and that money
damages would not provide an adequate remedy for the Company; provided,
however, the foregoing shall not prevent the Executive from contesting the
issuance of any such injunction on the ground that no violation or threatened
violation of Sections 11 or 12 has occurred.

16. Miscellaneous.

(a) This Agreement shall be governed by and construed in accordance with the
laws of the State of New York without reference to principles or conflict of
laws. Any disputes with respect to the interpretation of this Agreement or the
rights and obligations of the parties hereto shall be exclusively brought in
any federal or state court of competent jurisdiction located in the City of New
York, State of New York. Each of the parties waives any right to object to the
jurisdiction or venue of such Courts or to claim that such courts are an
inconvenient forum.

                                          15

<PAGE>

(b) The captions of this Agreement are not part of the provisions hereof and
shall have no force or effect. This Agreement may not be amended or modified
otherwise than by a written agreement executed by the parties hereto or their
respective successors and legal representatives.

(c) All notices and other communications hereunder shall be in writing and
shall be given by hand delivery to the other party or by registered or
certified mail, return receipt requested, postage prepaid, addressed as
follows:

If to the Executive:

If to the Executive:
Gary D. Morgan
6535-F Parkview Drive
Boca Raton, FL 33433
Tel: (561) 395-0929
Fax: (561) 394-8475

With a copy to:

Proskauer Rose LLP
1585 Broadway
New York, NY 10036
Tel: (212) 969-3000
Fax: (212) 969-2900
Attention: David W. Sloan, Esq.

If to the Company:
..
World Information Technology, Inc.
2300 West Sahara Avenue
Suite 500-B
Las Vegas, NV  89102
Tel: (702) 947.0105
Fax: (702) 947.0107

or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.

(d) The invalidity or unenforceability of any provision of this Agreement shall
not affect the validity or enforceability of any other provision of this
Agreement.

(e) The Executive's or the Company's failure to insist upon strict compliance
with any provision of this Agreement or the failure to assert any right the
Executive or the Company may have hereunder, including, without limitation, the
right of the Executive to terminate

                                         16

<PAGE>

employment for Good Reason pursuant to Section 5(c)(ii)(I) through (5) of this
Agreement, shall not be deemed to be a waiver of such provision or right or any
other provision or right of this Agreement.

                                          17

<PAGE>

IN WITNESS WHEREOF, the Executive has hereunto set the Executive's hand and,
pursuant to the authorization from its Board of Directors, the Company has
caused these presents to be executed in its name on its behalf, all as of the
day and year first above written.

WORLD INFORMATION TECHNOLOGY, INC.

By:
Name: Hsueh-Chu Lin
Title: President

By:  /s/ Steven D. Fel1ows
Name:  Steven D. Fellows
Title: Secretary

GARY D. MORGAN

                                            18

<PAGE>

                                                                    EXHIBIT A

THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933. THEY MAY NOT BE SOLD, OFFERED FOR
SALE PLEDGED HYPOTHECATED, OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED
ORAN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT THE REGISTRATION IS NOT
REQUIRED UNDER SUCH ACT OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SUCH ACT.

                        WARRANT TO PURCHASE COMMON STOCK

                                       Of

                      WORLD INFORMATION TECHNOLOGY; INC.

                           Void after July 31, 2008

This Warrant is issued August l, 2003 to Gary D. Morgan or his assigns with
address at 6535-F Parkview Drive, Boca Raton, FL 33433 ("Holder") by World
Information Technology, Inc" a Nevada corporation, with offices at 2300 West
Sahara Avenue, Suite 500-C, Las Vegas, NV 89102 (the "Company"), on August 1,
2003 (the "Warrant Issue Date").  This Warrant is issued pursuant to that
certain Employment Contract Agreement dated as of the Warrant Issue Date, a
copy of which is .attached hereto as Attachment A (the "Agreement").

1. Purchase Shares. Subject to the terms and conditions hereinafter set forth,
the Holder is entitled, upon surrender of this Warrant at the principal office
of the Company (or at such other place as the Company shall notify the Holder
in writing), to purchase from the Company up to five hundred thousand (500,000)
fully paid and nonassessable shares of Common Stock of the Company. The number
of shares of Common Stock issuable pursuant to this Section 1 (the "Shares")
shall be subject to adjustment pursuant to Sections 5 and 9 hereof.

2. Exercise Price. The purchase price for the Shares shall be $4.00, as
adjusted from time to time pursuant to Section 9 hereof (the "Exercise Price").

3. Exercise Period. This Warrant shall be exercisable, in whole or in part,
during the term commencing on the date five (5) days after the Warrant Issue
Date and ending at 5:00 p.m. on July 31, 2008; provided, however, that in the
event of (a) the closing of the Company's sale or transfer of all or
substantially all of its assets, or (b) the closing of the acquisition of the
Company by another entity by means of merger, consolidation or other
transaction or series of related transactions, resulting in the exchange of the
outstanding shares of the Company's capital stock unless (i) the shareholders
of the Company immediately prior to such transaction or series of related
transactions are holders of a majority of the voting equity securities of the
surviving or acquiring corporation immediately thereafter and (ii) each of such
shareholders immediately prior to such transaction or series of related
transactions holds the same pro rata share

                                     1

<PAGE>

of such majority of the voting equity securities of the surviving or acquiring
Corporation as each held of the Company immediately prior to such transaction
or series of related transactions, this Warrant shall, on the date of such
event, no longer be exercisable and become null and void.  In the event of a
proposed transaction of the kind described above, the Company shall notify the
Holder at least twenty (20) days prior to the consummation of such event or
transaction; provided, however, that the Holder shall in any event have at
least forty (40) days after the Warrant Issue Date to exercise this Warrant.
Notwithstanding the foregoing, in the event of the termination of the
Employment Agreement between the Company and the Holder dated the date hereof
(i) as a result of a material breach of such agreements by the Holder or (ii)
by the Holder without cause, this Warrant shall immediately upon such
termination no longer be exercisable and become null and void.

4. Method of Exercise. While this Warrant remains outstanding and exercisable
in accordance with Section 3 above, the Holder may exercise, in whole or in
part, the purchase rights evidenced hereby. Such exercise shall be effected by:

(a) the surrender of the Warrant, together with a duly executed copy of the
form of Notice of Election attached hereto, to the Secretary of the Company at
its principal offices; and

(b) the payment to the Company of an amount equal to the aggregate Exercise
Price for the number of Shares being purchased.

5. Net Exercise.  In lieu of exercising this Warrant pursuant to Section 4, the
Holder may elect to receive, without the payment by the Holder of any
consideration, shares of Common Stock equal to the value of this Warrant (or
the portion thereof being canceled) by surrender of this Warrant at the
principal office of the Company together with notice of such election, in which
event the Company shall issue to the Holder a number of shares of Common Stock
computed using the following formula:

                                        Y (A - B)
                                    X = ---------
                                            A

Where: X = The number of shares of Common Stock to be issued to the Holder
pursuant to this net exercise; y = The number of Shares in respect of which the
net issue election is made; A = The fair market value of one share of the
Common Stock at the time the net issue election is made; B = The Exercise Price
(as adjusted to the date of the net issuance). For purposes of this Section 5,
the fair market value of one share of Common Stock as of a particular date
shall be determined as follows: (i) if traded on a securities exchange or
through the Nasdaq Stock Market, the value shall be deemed to be the average of
the closing prices of the securities on such exchange over the ten (10) day
period ending three (3) days prior to the net exercise election ;or (ii) if
traded over-the counter, the value shall be deemed to be the average of the
closing sale prices over the twenty (20) day period ending three (3) days prior
to the net exercise.

                                      2

<PAGE>

6. Representations and Warranties of Holder.  The Holder hereby represents and
warrants that:

(a) Authorization. The Holder has full power and authority to enter into this
Warrant, and this Warrant constitutes its valid and legally binding obligation,
enforceable in accordance with its terms except (i) as limited by applicable
bankruptcy, insolvency, reorganization, moratorium, and other laws of general
application affecting enforcement of creditors' rights generally and (ii) as
limited by laws relating to the availability of specific performance,
injunctive relief, or other equitable remedies.

(b) Purchase Entirely for Own Account. This Warrant is being issued to such
Holder in reliance upon such Holder's representation to the Company, which by
such Holder's execution of this Warrant such Holder hereby confirms, that this
Warrant, the Common Stock to be received by such Holder upon exercise of this
Warrant and the Common Stock issuable upon conversion thereof (collectively,
the "Securities") will be acquired for investment for such Holder's own
account, not as a nominee or agent, and not with a view to the resale or
distribution of any part thereof, and that such Holder has no present intention
of selling, granting any participation in, or otherwise distributing the same.
By executing this Warrant, such Holder further represents that such Holder does
not have any contract; .undertaking, agreement or arrangement with any person
to sell, transfer or grant participations to such person or to any third
person, with respect to any of the Securities.

(c) Disclosure of Information. Such Holder further represents that it has had
an opportunity to ask questions and receive answers from the Company regarding
the terms and conditions of the offering of the Securities and the business,
properties, prospects and financial condition of the Company.

(d) Investment Experience. Such Holder is an investor in securities of
companies in the development stage and acknowledges that it is able to fend for
itself, can bear the economic risk of its investment, and has such knowledge
and experience in financial or business matters that it is capable of
evaluating the merits and risks of the investment in the Securities. If other
than an individual, Holder also represents it has not been organized for the
purpose of acquiring the Securities.

(e) Accredited Investor.  Such Holder is an "accredited investor" within the
meaning of Securities and Exchange Commission ("SEC") Rule 501 of Regulation D,
as presently in effect.

(f) Restricted Securities.  Such Holder understands that the Securities it is
purchasing are characterized as "restricted securities" under the federal
securities laws inasmuch as they are being acquired from the Company in a ,
transaction not involving a public offering and that under such laws and
applicable regulations such securities may be resold without registration under
the Securities Act of 1933, as amended (the "Act"), only in certain limited
circumstances. In this connection, such Holder represents that It is familiar
with SEC Rule 144, as presently in effect, and understands the resale
limitations imposed thereby and by the Act.

                                     3

<PAGE>

(g) Further Limitations on Disposition. Without in any way limiting the
representations set forth above, such Holder further agrees not to make any
disposition of all or any portion of the Securities unless and until the
transferee has agreed in writing for the benefit of the Company to be bound by
this Section 6, provided and to the extent this Section is then applicable,
and:

(i) There is then in effect a Registration Statement under the Act covering
such proposed disposition and such disposition is made in accordance with such
Registration Statement; or

(ii) (A) Such Holder shall have notified the Company of the proposed
disposition and shall have furnished the Company with a detailed statement of
the circumstances surrounding the proposed disposition, and (B) if reasonably
requested by the Company, such Holder shall have furnished the Company with an
opinion of counsel, reasonably satisfactory to the Company that such
disposition will not require registration of such securities under the Act. It
is agreed that the Company will not require opinions of counsel for
transactions made pursuant to Rule 144 except in unusual circumstances.

{iii) Notwithstanding the provisions of Paragraphs (i) and (ii) above, no such
registration statement or opinion of counsel shall be necessary for a transfer
by a Holder (A) that is a partnership to a partner of such partnership or a
retired partner of such partnership who retires after the date hereof, or to
the estate of any such partner or retired partner or the transfer by gift, will
or intestate succession of any partner to his or her spouse or to the siblings,
lineal descendants or ancestors of such partner or his or her spouse, or (B) to
any entity that is controlled by, controls or is under common control with the
Holder, if the transferee agrees in writing to be subject to the terms hereof
to the same extent as if he or she were an original Holder hereunder.

(h) Legends. It is understood that the certificates evidencing the Securities
may bear one or all of the following legends:(i) "These securities have not
been registered under the Securities Act of 1933, as amended. They may not be
sold, offered for sale, pledged or hypothecated in the absence of a
registration statement in effect with respect to the securities under such Act
or an opinion of counsel satisfactory to the Company that such registration is
not required or unless sold pursuant to Rule 144 of such Act."(ii) Any legend
required by the laws of the State of Nevada, including any legend required by
the Nevada Department of Corporations and Sections 417 and 418 of the Nevada
Corporations Code.

7. Certificates for Shares. Upon the exercise of the purchase rights evidenced
by this Warrant, one or more certificates for the number of Shares so purchased
shall be issued as soon as practicable thereafter (with appropriate restrictive
legends. if applicable), and in any event within twenty (20) days of the
delivery of the subscription notice.  In case the holder shall exercise this
Warrant with respect to less than all of the Shares that may be purchased under
this

                                          4

<PAGE>

Warrant, the Company shall execute a new warrant in the form of this Warrant
for the balance of such Shares and deliver such new warrant to the holder of
this Warrant.

8. Issuance of Shares. The Company covenants that it will at all times keep
available such number of authorized shares of its Common Stock, free from all
preemptive rights with respect thereto, which will be sufficient to permit the
exercise of this Warrant for the full number of Shares specified herein.  The
Company covenants that the Shares, when issued pursuant to the exercise of this
Warrant, will be duly and validly issued, fully paid and nonassessable and free
from all taxes, liens, and charges with respect to the issuance thereof.

9. Adjustment of Exercise Price and Number of Shares. The number of and kind of
securities purchasable upon exercise of this Warrant and the Exercise Price
shall be subject to adjustment from time to time as follows:

(a) Subdivisions, Combinations and Other 1ssuances. If the Company shall at any
time prior to the expiration of this Warrant subdivide its Common Stock, by
split-up or otherwise, or combine its Common Stock, or issue additional shares
of its Common Stock or Common Stock as a dividend with respect to any shares of
its Common Stock, the number of Shares issuable on the exercise of this Warrant
shall forthwith be proportionately increased in the case of a subdivision or
stock dividend, or proportionately decreased in the case of a combination.
Appropriate adjustments shall also be made to the purchase price payable per
share, but the aggregate purchase price payable for the total number of Shares
purchasable under this Warrant (as adjusted) shall remain the same. Any
adjustment under this Section 8(a) shall become effective at the course of
business on the date the subdivision or combination becomes effective, or as of
the record date of such dividend, or in the event that no record date is fixed,
upon the making of such dividend.

(b) Reclassification, Reorganization and Consolidation.  In case of any
reclassification, capital reorganization, or change in the Common Stock of the
Company (other than as a result of a subdivision, combination, or stock
dividend provided for in Section 8(a) above), then, as a condition of such
reclassification, reorganization, or change, lawful provision shall be made,
and duly executed documents evidencing the same from the Company or its
successor shall be delivered to the Holder, so that the Holder shall have the
right at any time prior to the expiration of this Warrant to purchase, at a
total price equal to that payable upon the exercise of this Warrant, the kind
and amount of shares of stock and other securities and property receivable in
connection with such reclassification, reorganization, or change by a holder of
the same number of shares of Common Stock as were purchasable by the Holder
immediately prior to such reclassification, reorganization, or change.  In any
such case appropriate provisions shall be made with respect to the rights and
interest of the Holder so that the provisions hereof shall thereafter be
applicable with respect to any shares of stock or other securities and property
deliverable upon exercise hereof, and appropriate adjustments shall be made to
the purchase price per share payable hereunder, provided the aggregate purchase
price shall remain the same.

                                        5

<PAGE>

(c) Notice of Adjustment. When any adjustment is required to be made in the
number or kind of shares purchasable upon exercise of the Warrant, or in the
Warrant Price, the Company shall promptly notify the holder of such event and
of the number of shares of Common Stock or other securities or property
thereafter purchasable upon exercise of this Warrant.

(d) No Impairment. The Company and the holder of this Warrant will not, by any
voluntary action, avoid or seek to avoid the observance or performance of any
of the terms to be observed or performed hereunder by the Company or the holder
of this Warrant, respectively, but will at all times in good faith assist in
the carrying out of all the provisions of this Section 9 and in the taking of
all such action as may be necessary or appropriate in order to protect the
rights of the Company and the holder of this Warrant against impairment.

10. No Fractional Shares or Scrip.  No fractional shares or scrip representing
fractional shares shall be issued upon the exercise of this Warrant, but in
lieu of such fractional shares the Company shall make a cash payment therefor
on the basis of the Exercise Price then in effect.

11. No Shareholder Rights. Prior to exercise of this Warrant, the Holder shall
not be entitled to any rights of a shareholder with respect to the Shares,
including (without limitation) the right to vote such Shares, receive dividends
or other distributions thereon, exercise preemptive rights or be notified of
shareholder meetings, and such holder shall not be entitled to any notice or
other communication concerning the business or affairs of the Company. However,
nothing in this Section 11 shall limit the right of the Holder to be provided
the Notices required under this Warrant; provided further, however, the Company
will afford to the Holder the right, upon advance notice, to meet periodically
with the Company's chief financial officer during mutually agreeable business
hours to discuss the Company's business and affairs.

12. Transfers of Warrant. Subject to compliance with applicable federal and
state securities laws, this Warrant and all rights (but only with all related
obligations) hereunder are transferable in whole or in part by the Holder upon
the prior written consent of the Company. The transfer shall be recorded on the
books of the Company upon (i) the surrender of this Warrant, properly endorsed,
to the Company at its principal offices, (ii) the payment to the Company of all
transfer taxes and other governmental charges imposed on such transfer and
(iii) such transferee's agreement in writing to be bound by and subject to the
terms and conditions of this Warrant. In the event of a partial transfer, the
Company shall issue to the holders one or more appropriate new warrants.

13. Successors and Assigns. The terms and provisions of this Warrant and the
Purchase Agreement shall inure to the benefit of, and be binding upon, the
Company and the Holders hereof and their respective successors and assigns.

14. Registration Rights.  If, at any time, the Company proposes to prepare and
file with the Securities and Exchange Commission (the "Commission") a
registration statement covering equity or debt securities of the Company, or
any such securities of the Company held by its shareholders (In any such case,
other than in connection with a merger, acquisition, a Form S-8 or successor
form) it

                                       6

<PAGE>

will give written notice of its intention to do so by registered mail
("Notice"), at least ten (10) days prior to the filing of each such
Registration Statement, to the holder of the Registerable Securities. Upon the
written request of the Holder (a "Requesting Holder"), made within ten (10)
days after receipt of the Notice, that the Company include any of the
Requesting Holder's Registerable Securities in the proposed Registration
Statement, the Company shall use its best efforts to effect the registration
under the Securities Act of the Registrable Securities which it has been so
requested to register ("Piggyback Registration"), at the Company's sole cost
and expense and at no cost or expense to the Holder. Within 30 days of this
Warrant being exercised in it's entirety, the Company shall file a Form S-8 or
successor form to register the common shares underlying this warrant.

15. Amendments and Waivers. Any term of this Warrant may be amended and the
observance of any term of this Warrant may be waived (either generally or in a
particular instance and either retroactively or prospectively), with the
written consent of the Company and the Holder. Any waiver or amendment effected
in accordance with this Section shall be binding upon each holder of any Shares
purchased under this Warrant at the time outstanding (including securities into
which such Shares have been converted), each future holder of all such Shares,
and the Company.

16. Notices. All notices required under this Warrant and shall be deemed to
have been given or made for all purposes (i) upon personal delivery (ii) upon
confirmation receipt that the communication was successfully sent to the
applicable number if sent by facsimile; (iii) one (1) business day after being
sent, when sent by professional overnight courier service, or (iv) five (5)
days after posting when sent by registered or certified mail. Notices to the
Company shall be sent to the principal office of the Company (or at such other
place as the Company shall notify the Holder hereof in writing). Notices to the
Holder shall be sent to the address of the Holder on the books of the Company
(or at such other place as the Holder shall notify the Company hereof in
writing).

17. Attorneys' Fees. If any action of law or equity is necessary to enforce or
interpret the terms of this Warrant, the prevailing party shall be entitled to
its reasonable attorneys' fees, costs and disbursements in addition to any
other relief to which it may be entitled.

18. Captions. The section and subsection headings of this Warrant are inserted
for convenience only and shall not constitute a part of this Warrant in
construing or interpreting any provision hereof.

19. Governing Law. This Warrant shall be governed by the laws of the State of
Nevada as applied to agreements among Nevada residents made and to be performed
entirely within the State of Nevada.

20. Survival. The warranties, representations and covenants contained in or
made pursuant to this Warrant shall survive the execution, delivery and
exercise, if any, of this Warrant.

21. Registration.   When requested by the Holder, the Company will register
this Warrant and the underlying Shares in an S-8 Registration Statement.

                                          7

<PAGE>

IN WITNESS WHEREOF the parties hereto have caused this Warrant to be executed
by an officer thereunto duly authorized.

World Information Technology, Inc.
"Company"

By:
    --------------------------------------
Hsu-Chu Lin, President and Sole Director

By:  /s/ Steven D. Fellows
    ----------------------
         Steven Fellows, Secretary

"Holder"

/s/ Gary Morgan
---------------
  Gary Morgan

                                               8

<PAGE>

                                    NOTICE OF EXERCISE

To: World Information Technology, Inc.

The undersigned hereby elects to [check applicable subsection]:

_______(a) Purchase_______________shares of Common Stock of World Information
Technology, Inc.; pursuant to the terms of the attached Warrant and payment of
the Exercise Price per share required. under such Warrant accompanies this
notice; OR

_______(b) Exercise the attached Warrant for [all of the shares] [_________of
the shares] [cross out inapplicable phrase] purchasable under the Warrant
pursuant to the net exercise provisions of Section 5 of such Warrant. The
undersigned hereby represents and warrants that the undersigned is acquiring
such shares for its own account for investment purposes only, and not for
resale or with a view to distribution of such shares or any part thereof.

WARRANTHOLDER:  Gary D. Morgan

By:
  ------------------------------------
                 [NAME]

Address:------------------------------

        ------------------------------

Date: ____________

Name in which shares should be registered:

-----------------------------------------

                                             9

<PAGE>

                                                                 EXHIBIT B

                        CONVERTIBLE NOTE AGREEMENT

This Convertible Note Agreement ("Agreement"), dated as of [     ] 200[ ] (the
"Effective Date"), between World Information Technology, Inc., a Nevada
corporation, having an address at 2300 West Sahara Avenue, Suite 500-C, Las
Vegas, NV 89102 (the "Company") and Gary D. Morgan with offices at 6535-F
Parkview Drive, Boca Raton, FL 33433 ("Note Holder").

                                   RECITAL

The Note Holder is owed the amount of $[    ] (the "Sum") by the Company and
the Company is entering into this Agreement in order to provide incentive to
the Note Holder to defer payment of the Sum as herein provided. The Sum is an
obligation owed by the Company to the Note Holder pursuant to an employment
agreement, dated as of July 24, 2003 ("Employment Agreement") between the
parties. Hereafter there may be additional obligations of the Company to the
Note Holder pursuant the Employment Agreement and such obligations will be
evidenced by an agreement in the form as this. Agreement (collectively the
"Obligations"), which Obligations shall be evidenced by one or more Convertible
Promissory Notes ("Notes"), substantially in the form attached hereto as
Exhibit A, all pursuant to the terms and conditions described in this
Agreement.

NOW, THEREFORE, in consideration of the premises and for good and valuable
consideration the receipt of which is acknowledged, the parties agree as
follows:

I.  The Note

A. The above recital is true, correct and incorporated herein by reference.

B. The Company shall issue to the Note Holder the Note substantially in the
form set forth in Exhibit A, subject to the terms and conditions of this
Agreement and in reliance upon the representations and warranties contained in
this Agreement. The Note will be dated the date hereof and will mature on [  ,]
200[ ] (the "Maturity Date"), unless terminated earlier pursuant to the terms
and conditions of this Agreement.

C. The Note shall bear interest on the unpaid principal amount at the rate of
six percent (6%) per year, payable on the Maturity Date. To the extent that any
Obligations, in whole or in part, is outstanding at any time after the Maturity
Date, the interest rate shall be at the rate of twelve percent (12.0%) per
year. For the purposes of calculating interest for any period for which the
interest shall be payable, such interest shall be calculated on the basis of a
thirty (30) day month and a three hundred sixty (360) day year.

D. The Company will promptly and punctually pay to Note Holder or his nominee
or designee the principal and interest on the Note without presentment of the
Notes. In the event the

                                           1

<PAGE>

Note Holder shall sell or transfer the Note, the Note Holder shall notify the
Company of the name and address of the transferee.  In the event the Company
defaults on any installment of interest or principal on the Note given pursuant
to this Agreement or in connection with any of the Obligations, then the Note
Holder may, at such Note Holder's option, without notice, declare the entire
principal and the interest accrued under each Note immediately due and payable
and may proceed to enforce the collection thereof or may elect to convert the
whole or any portion of same into common stock of the Company at $4.00 per
share or 50% of the closing bid price on the Common Stock of the Company on the
conversion date, whichever is lowest share price yielding the most conversion
shares, subject to adjustment as provided in Section V hereof.

II.  Representations and Warranties by the Company

A. The Company (i) is a corporation existing in good standing under the laws of
the State of Nevada and (ii) has the corporate power to own property and to
carry on in the business as it is now being conducted.

B. The Company has timely made all filings required of it by the Securities
Exchange Commission ("SEC") since its incorporation, which are a part of its
public record. All of such filings are complete and accurate and contain all
material facts and do not omit any such facts or matters and will continue to
..do so during the period which any Note is outstanding.

C. There is no action or proceeding pending or to the Company's knowledge,
threatened against the Company before any court or administrative agency, the
determination of which might result in any material adverse change in the
business of the Company.

D. The Company has good and clear title to all of its properties and assets
including the properties and assets reflected on its financial statements filed
with the SEC and which assets and properties (are all of its assets and
properties of any kind and nature and the values thereof are on such statements
and are reflected at the lower of cost or market and net of all appropriate
doubtful accounts or reserves) are not subject to any liens, mortgages,
encumbrances or charges.

E. The Company is not a party to any contract or agreement or subject to any
restriction which materially and adversely affects its business, property,
assets, or financial condition, and neither the execution nor delivery of this
Agreement, nor the consummation of the transactions contemplated herein, nor
the fulfillment of the terms hereof, nor the compliance with the terms and
provisions hereof and of the Note will conflict with or result in the breach of
the terms, conditions or provisions or constitute a default, under the Articles
of Incorporation or of any Agreement or instrument to which the Company is now
a party or upon conversion of the Note pursuant to the conversion privileges
hereinafter stated .

F. The Company has not declared, set aside, paid or made any dividend or other
distributions with respect to its capital stock and has not made or caused to
be made directly or indirectly any payment or other distribution of any nature
whatsoever to any of the Note Holders of its capital {and will not make any
while the Note is outstanding) stock except for regular salary payments for
services rendered and the reimbursement of business expenses.

                                        2

<PAGE>

G. All of the equipment and other tangible assets of the Company, if any, are
in good condition and repair.

H. The Company owns or possesses adequate licenses or other rights to use all
patents, trademarks, trade names, trade secrets, and copyrights used in its
business.  No one has asserted to the Company that its operations infringe on
the patents, trademarks, trade secrets or other rights utilized in the
operation of its business.

I. The Company shall reserve such number of shares of its common stock as may,
from time to time, be the maximum number of shares issuable, assuming
conversion of all the Notes into fully paid and non-assessable shares of
restricted Company common stock ("Conversion Stock"), as contemplated herein.

III.  Representations and Warranties by the Note Holder

The Note Holder represents and warrants to the Company that:

A. The Note Holder is subscribing for the Note for investment purposes and not
with the view to or for sale in connection with any distribution thereof and
that he has no present intent to sell, give or otherwise transfer the Note.
Upon conversion of the Note, the Conversion Stock will be received by the Note
Holder for investment purposes for its own account, and not with the view to,
or for resale in connection with, any distribution thereof. Note Holder
understands that the Conversion Stock will not been registered under the
Securities Act of 1933, as amended (" Act"), or under the securities laws of
various states, by reason of a specified exemption from the registration
provisions thereunder.

B. The Note Holder is a resident of the State of Florida.

C.  The Note Holder understands that investing in the Note is a highly
speculative investment.

D.  The Note Holder is a sophisticated investor.

E. The Note Holder shall hold the Conversion Stock indefinitely unless such
shares are subsequently registered under the Act and under applicable state
securities laws or an exemption from such registration .is available. Note
Holder has been advised or is aware of the provisions of Rule 144 promulgated
under the Act which permits limited resale of the securities purchased in a
private placement subject to the satisfaction of certain conditions including,
among other things, the availability of certain current public information
about Company and compliance with applicable requirements regarding the holding
period and the amount of securities to be sold and the manner of sale.

F. The Note Holder represents he is an " Accredited Investor" as the term is
defined in Rule 501(a) of Regulation D under the Act.

                                       3

<PAGE>

IV.  Prepayment of the Notes

A. If the common stock of the Company which is traded on a "Principal Market"
closes at less than $1.00 per share for twenty consecutive trading days, the
Company shall have the right to make prepayment in full of the principal of the
Notes at any time on ten (10) business days prior written notice to the Note
Holder. Such prepayment shall be accompanied by a payment of all accrued
interest to date. There shall be no premium for the amount so prepaid. Upon
such notice the Note Holder may elect to convert the Note as herein provided.
B. Principal Market" means the Nasdaq National Market, the Nasdaq Small Cap
Market, the American Stock Exchange or the New York Stock Exchange, whichever
is at the time the principal trading exchange or market for the Common Stock.

V.  Conversion.

A. The Note Holder of the Note at any time prior to, on, or after if the
Company is in default in payment after default) or upon receipt by the Note
Holder if notice of prepayment shall have been given, at any time up to the
close of business on the third business day prior to the day fixed for
prepayment but not thereafter, may convert the Notes in whole or in part into
as many shares of Conversion Stock as the principal amount of and interest on
the Note at $4.00 per share or 50% of the closing bid price on the conversion
date, whichever is the lowest share price yielding the most conversion shares,
subject to adjustment as herein provided (as elected by the Note Holder). If
the Notes shall be converted in part, the Company shall, without charge to the
Note Holder execute and deliver to the Note Holder a new Note for the balance
of the principal amount plus accrued interest so converted.  If the Company
shall sell any securities at a price per share less than $4.00 per share or 50%
of the closing bid price on the date of issuance (if less than $4.00 per
share), the conversion price under the Notes shall be automatically adjusted to
such price.

B. In the event the Company shall at any time divide its outstanding shares of
Common Stock into a greater number of shares, the conversion price in effect
immediately prior to such subdivision should be proportionately reduced, and,
conversely, in the case of outstanding shares of Common Stock of the Company
shall be combined into a smaller number of shares, the actual conversion price
in effect immediately prior to such combination shall be proportionately
increased.

C. In the event the Company shall declare a dividend or make a distribution of
any securities of the Company payable in Common Stock or in convertible
securities, the aggregate maximum number of shares of Common Stock available
for issue in payment of such dividend or distribution, or upon conversion of or
in exchange for such convertible securities available for issue in payment of
such dividend or distribution, shall be deemed to have been issued or sold
without consideration. This shall result in a reduction of the conversion price
of the Note as provided in the last sentence of A above.

D. No fractional share of Common Stock shall be issued upon conversion of any
of the Notes. If any Holder of the Notes shall have converted all the Notes
held by him other than a

                                       4

<PAGE>

principal amount so small that less than a whole share of Common Stock would be
available for issue upon conversion thereof, the Company may elect to prepay
such balance, with interest accrued thereon to the date fixed for prepayment,
or leave the same outstanding until the maturity of the Note.

E. Any reclassification or change of outstanding shares of Common Stock
available for issue upon conversion of the Notes (other than a change in stated
value or from no par to par value) or in the case of any consolidation or
merger of the Company with any other corporation, or in the case of the sale
and conveyance to another corporation or person of the property of the Company
in its entirety or substantially as an entirety, the Company shall, as a
condition precedent to such transaction, cause effective provisions to be made
that each Holder of the Notes then outstanding shall have the right thereafter
to convert the Notes into the kind and amount of shares of Stock and other
securities and property receivable upon such reclassification, change,
consolidation, merger, sale or conveyance by a Holder of the number of shares
of Common Stock in the Company into which such Notes might have been converted
immediately prior to such reclassification, change, consolidation, merger, sale
or conveyance. In the event of a change of control of the Company, it shall
have the right, at its option, to convert any or all of the Notes, pursuant to
the terms and conditions of this agreement.

VI.  Covenants

The Company covenants that so long as the Obligations under the Note remain
outstanding, the Company will cause its Common Stock {inclusive of the shares
of common stock into which a Note is convertible) to continue to be registered
under the Act, will use its reasonable efforts to comply in all respects with
its reporting and filing obligations under the Securities Exchange Act
("Exchange Act"), and will not take any action or file any document (whether or
not permitted by securities law of the United States or the rules thereunder)
to terminate or suspend such registration or to terminate or suspend its
reporting and filing Obligations under the Act or the Exchange Act.

If, at any time, the Company proposes to prepare and file with the SEC a
registration statement covering equity or debt securities of the Company, or
any such securities of the Company held by its shareholders, it will give
written notice of its intention to do so by registered mail ("Notice"), at
least thirty (30) days prior to the filing of each such Registration Statement,
to the Note Holder. Upon the written request of Note Holder made within twenty
(20) days after receipt of the Notice, that the Company include any of the Note
Holder's shares converted from this Note in the proposed Registration
Statement, the Company shall use its best efforts to effect the registration
under the Act of the Note and underlying shares which it has been so requested
to register ("Piggyback Registration") by the Note Holder, at the Company's
sole cost and expense and at no cost or expense to the Note Holder.

The Company agrees that it will, at the request of the Note Holder, effect a
registration statement with respect to any of the Notes and the underlying
shares, pursuant to an effective registration statement under the Securities
Act of 1933 {as now in effect or as hereafter amended) pursuant to a
registration statement of Form S-4 or Form S-8 or any successor or similar
form.

VII. Event of Default

                                         5

<PAGE>

A. The occurrence or breach of any of the events or conditions contained in
this Section VII of this Agreement shall constitute an event of default under
this Agreement and under each other agreement signed by the Company with
respect to the Obligations under this Agreement or such other agreement. The
Note Holder may give written notice of such breach and if the Company shall
within ten (10) days after receipt of such written notice have failed to
correct such occurrence or condition, then the Note Holder may, at its option
and without notice, declare the entire principal and interest accrued thereon
immediately due and payable and may proceed with collection.

B. If the Company has made a misrepresentation in connection with this
Agreement or with the transactions contemplated by this Agreement, or if the
Company makes an assignment for the benefit of creditors, or a trustee or
receiver is appointed for the Company; or if any proceeding involving the
Company is commenced by or against the Company under any bankruptcy,
reorganization, arrangement, insolvency, statute or law, such event shall be
deemed a default which will immediately entitled the Note Holder, at its option
and without notice, to declare the entire amount of interest accrued thereon
immediately due and payable and proceed to enforce the collection thereof.

C. In case of default in the payment of any installment or principal, the Note
Holder may, at its option and without notice, declare the entire principal and
the interest accrued thereon immediately due and payable and may proceed to
enforce the collection thereof.

VIII. Securities Matters

A. The Note Holder is aware that no federal or state or other agency has passed
upon or made any finding or determination concerning the fairness of the
transactions contemplated by this Agreement or the adequacy of the disclosure
of the exhibits and schedules hereto.  The Note Holder understands and
acknowledges that neither the Internal Revenue Service nor any other tax
authority has been asked to rule on nor has it ruled on the tax consequences of
the transactions contemplated hereby.

The Note Holder understands that all certificates for the Conversion Stock
shall bear a legend in substantially the following form:

"THESE SECURITIES HA VE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, OR QUALIFIED UNDER ANY STATE SECURITIES LA WS. THE SECURITIES MAY
NOT BE OFFERED, SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF WITHOUT SUCH
REGISTRATION OR THE DELIVERY TO THE ISSUER OF AN OPINION OF COUNSEL,
SATISFACTORY TO THE ISSUER, THAT SUCH DISPOSITION WILL NOT REQUIRE REGISTRATION
OF SUCH SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE
SECURITIES LAWS."

IX. Miscellaneous

                                            6

<PAGE>

A.    Any and all notices, approval or other communications to be sent to the
parties shall be deemed validly and properly given if made in writing and
delivered, by hand or by registered or certified mail, return receipt requested
to the addresses set forth in the first paragraph of this Agreement or to such
other address as either party, gives to the other in-writing,

B.    This Agreement may not be modified, amended or terminated except by
written agreement executed by all the parties hereto.

C.    The waiver of any breach or default hereunder shall not be considered
valid unless in writing and signed by the party giving such notice and no
waiver shall be deemed a waiver of any subsequent breach or default of same.

D.    The paragraph headings contained herein are for the purpose of
convenience only and are not intended to define or limit the contents of such.

E.    The validity, constructional interpretation and enforceability of this
Agreement and the Note executed pursuant to this Agreement shall be determined
and governed by the laws of the State of New York without regard to conflict of
law principles. Any action or proceeding with respect to this Agreement or the
Note shall be brought exclusively in the Federal or State Courts of New York
City, New York and each party waives the right to contest the jurisdiction or
venue of any of such cowls or to claim it is an inconvenient forum.

F.   This Agreement shall be binding upon and inure to the benefit of the
parties and
their respective successors and assigns.

G.    This Agreement may be executed in one or more counterparts, each of which
shall be deemed and original.

H.    Any notice required or permitted hereunder shall be in writing and
delivered personally or to the address of the party set forth under its
signature or to such other address or party which one party gives notice to the
other.

WORLD INFORMATION TECHNOLOGY, INC.

By:  /s/ Hsueh-Chu Lin
    -------------------
Name: Hsueh-Chu Lin
Its: President

By:
   --------------------
Name: Steven Fellows
Its: Secretary

-----------------------
Gary D. Morgan

<PAGE>

                                        7

<PAGE>

                                                     EXHIBIT A TO CONVERTIBLE
                                                               NOTE AGREEMENT

                  Form of Convertible Promissory Note

THIS CONVERTIBLE PROMISSORY NOTE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS. NEITHER THIS
CONVERTIBLE PROMISSORY NOTE NOR ANY INTEREST THEREIN INCLUDING THE SHARES OF
COMMON STOCK INTO WHICH THIS NOTE IS CONVERTIBLE) MAY BE OFFERED, SOLD,
PLEDGED, OR OTHERWISE TRANSFERRED UNLESS THIS CONVERTIBLE PROMISSORY NOTE IS
FIRST REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND/OR QUALIFIED
UNDER ALL APPLICABLE STATE SECURITIES LAWS, OR UNTIL THE COMP ANY SHALL HA VE
RECEIVED AN OPINION OF LEGAL COUNSEL, REASONABLY SATISFACTORY TO THE COMPANY,
THAT THIS CONVERTIBLE PROMISSORY NOTE MAY LAWFULLY BE OFFERED, SOLD, PLEDGED,
OR OTHERWISE TRANSFERRED WITHOUT SUCH REGISTRA TION AND/OR QUALIFICATION IN
RELIANCE UPON AN APPLICABLE EXEMPTION .

WORLD INFORMATION TECHOLOGY, INC. CONVERTIBLE PROMISSORY NOTE Interest Rate: 6%
per year through Maturity Date 12% per year following Maturity Date Convertible
into shares of Restricted Common Stock of World Information Technology, Inc. at
$4.00 per share or 50% of the closing bid price on the conversion date
whichever is the lowest share price yielding the most conversion shares,
subject to adjustment

                                                        Amount: $____________
Las Vegas, Nevada
                                                         Dated: _________, 200

For value received, WORLD INFORMATION TECHNOLOGY INC., a Nevada corporation
with address at 2300 West Sahara Avenue, Suite 500-C, Las Vegas, NV 89102
{"Company"), promises to pay to the order Gary D. Morgan ("Payee"), at his
office at 6535-F Parkview Drive, Boca Raton, FL 33433 (the "Office") or such
other place therein designated in writing by the Note Holder the principal
amount of Dollars ($__________) (the "Obligations") on [  ] ("Maturity Date"),
together with interest from the date hereof as described below.

This Convertible Promissory Note ("Note") is issued pursuant to a Convertible
Note Agreement (the "Agreement") between the Company and the Payee, dated [ ].

                                           9

<PAGE>

This Note is subject to the following terms and conditions:

1.  Principal and Interest Payments.

a. This Note bears interest from the date hereof, on the unpaid principal
balance, at a rate per annum of (i) six percent (6%) through [200  ] (the
"Maturity Date") and (ii) twelve percent{l2%) from the Maturity Date until such
time as the Obligations shall be paid or satisfied in full, which will accrue
daily from the date of this Note and be payable on the Maturity Date ( or until
paid in full) , which interest payments may be made in the form of cash, shares
of the Company's common stock $4.00 per share or 50% of the closing bid price
on the conversion date, whichever is the lowest share price yielding the most
conversion shares, subject to adjustment ("Common Stock") or a combination of
cash and shares, as elected, in its sole discretion by the Payee

b. The entire unpaid principal, together with any accrued but unpaid interest,
shall be due and payable in full on the Maturity Date.

c. All computations of interest made or called for herein shall be made on the
basis of a 360-day year for the actual number of days elapsed.

d. All payments due on this Note shall be applied first to accrued interest,
and second, to any remainder in payment of principal.

e. Except as otherwise provided in this Note, all payments of principal and
interest on this Note shall be paid in the legal currency of the United States
of America.

2. Optional Prepayments.

a. So long as the Common Stock of the Company is traded on a principal Market
at 1ess than $1.00 per share for twenty (20) consecutive trading days, the
Company shall have the right to prepay the Note in full, inclusive of accrued
interest on ten (10) business days prior written notice to the Note Holder.
Upon any such notice the Note Holder may elect to convert the Note herein
provided.

b. "Principal Market" means the Nasdaq National Market, the Nasdaq Small Cap
Market, the OTC Bulletin Board, the American Stock Exchange or the New York
Stock Exchange, whichever is at the time the principal trading exchange or
market for the Stock. As of the date of this Agreement, the OTC Bulletin Board
Market is the Principal Market.

3. Conversion of Note.

a. At any time from the date hereof up to and including the Maturity Date, or
if there is a default hereunder, at the election of the Payee at any time
within three months thereafter or, at any time up to the close of business on
the third business day prior to the day fixed for prepayment but not
thereafter, may convert the Note in whole or in part into as many fully paid
and non-assessable shares of Common Stock as the principal amount plus accrued
interest of the Note on a one share of Stock for $4.00 per share or 50% of the
closing bid price on the

                                          10

<PAGE>

conversion date, whichever is the lowest share price yielding the most
conversion shares, subject to adjustment {as herein provided), of principal and
accrued interest.  If the Note shall be converted in part, the Company shall,
without charge to the Note Holder execute and deliver to the Payee a new Note
for the balance of the principal amount and interest not so converted. Attached
to this Note as Exhibit A are the Instructions to convert the Note that could
be used by Payee if he wants to exercise his conversion rights under the Note.

b. On conversion of the Note, all accrued and unpaid interest on the principal
amount converted shall be paid to the Payee by the Company in Common Stock on a
one share of Common Stock for $4.00 per share or 50% of the closing bid price
on the conversion date, whichever is the lowest share price yielding the most
conversion shares, subject to adjustment, to the extent elected by the Payee.

c. No fractional share of Common Stock shall be issued upon conversion of any
of the Notes. If the Payee shall have converted the Note held by him other than
a principal amount so small that less than a whole share of Common Stock would
be available for issue upon conversion thereof, the Company may elect to prepay
such balance, with interest accrued thereon to the date fixed for prepayment.

Adjustment to Applicable Conversion Rate.

d. Adjustment for Stock Splits and Subdivisions. In the event the Company
should at any time or from time to time after the date of issuance hereof fix a
record date for the effectuation of a split or subdivision of the outstanding
shares of Stock or the determination of holders of Stock entitled to receive a
dividend or other distribution payable in additional shares of Stock or other
securities or rights convertible into, or entitling the holder thereof to
receive directly or indirectly, additional shares of Stock (hereinafter
referred to as " Stock Equivalents") without payment of any consideration by
such holder for the additional shares of Stock Equivalents (including the
additional shares of Stock issuable upon conversion or exercise thereof), then,
as of such record date ( or the date of such dividend distribution, split or
subdivision if not record date is fixed), the Conversion Price of this Note
shall be appropriately decreased so that the number of shares of Stock issuable
upon conversion of this Note shall be increased in proportion to such increase
of outstanding shares.

e.  Adjustments for Reverse Stock Splits.  If the numbers of shares of Stock
outstanding at any time after the date hereof is decreased by a combination of
the outstanding shares of Stock, then, following the record date of such
combination, the Conversion Price for this Note shall be appropriately
increased so that the number of shares of Stock issuable on conversion hereof
shall be decreased in proportion to such decrease in outstanding shares.

f.  Adjustments for Issuance of Securities Below a Certain Price. If the
Company shall sell any securities at a price per share less than $4.00 per
share or 50% of the closing bid price on the date of issuance (if less than
$4.00 per share) the conversion price hereunder shall be automatically adjusted
to such price.

4. Place of Payment. Payment shall be made to Payee at Office or at such other
place as Payee may designate in writing to the Company.

                                          11

<PAGE>

5. Default.

a. The occurrence of any of the following shall constitute an "Event of
Default" under this Note:

i. Failure of Company to pay the principal and any accrued interest in full on
the Maturity Date of this Note (or any other promissory note issued by the
Company to the Payee) and the continuation of such failure for ten (10)
business days after receipt by Company of notice of such failure and demand for
payment; or

ii. Company's consent to the appointment of a receiver, trustee or liquidator
of itself or of a substantial part of its property, or Company's admittance in
writing of its inability to pay its debts generally as they become due, or
Company's general assignment for the benefit of creditors, or Company's filing
of a voluntary petition in bankruptcy, or a voluntary petition or answer
seeking reorganization in a proceeding under any bankruptcy law (as now or
hereafter in effect), or the filing against the Company of a petition, answer
or' consent, seeking relief under the provisions of any other now existing or
future bankruptcy or other similar law providing for the reorganization or
winding up of corporations, or Company, fails to discharge within ninety (90)
days any involuntary petition in bankruptcy filed against it or if it is
adjudicated a bankrupt.

iii.  Any event of default described in Section VII of the Agreement.

b. Upon the occurrence of any Event of Default, all amounts due under this
Note, including the unpaid balance of principal and interest hereof, shall
become immediately due and payable at the option of Payee, without demand or
notice whatsoever, and Payee may immediately and without demand exercise any of
Payee's rights and remedies granted herein, under applicable law, or which
Payee may otherwise have against Company or otherwise at law or equity.

6. Assignment, The rights and Obligations of the Company and the Payee of this
Note shall be binding upon and benefit the successors, assigns, heirs,
administrators and transferees of the parties. The Company may not endorse,
negotiate, transfer or assign (collectively, "transfer") this Note or the
Company's rights hereunder without the prior written consent of the Payee. Any
notice, request or other communication required or permitted hereunder shall be
in writing and shall be deemed to have been duly given if personally delivered
or if telegraphed or mailed by registered or certified mail, postage prepaid,
at the respective addresses of the parties as set forth at the outset hereof.
Any party hereto may by notice so given change its address for future notice
hereunder. Notice shall conclusively be deemed to have been given when
personally delivered or when deposited in the mail or telegraphed in the manner
set forth above and shall be deemed to have been received when delivered.

                                       12

<PAGE>

7.  No Shareholder Rights.  Nothing contained in this Note shall be construed
as conferring upon the Payee or any other person the right to vote or to
consent or to receive notice as a stockholder in respect of meetings of
stockholders for the election of the Company or any other matters or any rights
whatsoever as a stockholder of the Company; and no dividends or other
distributions shall be payable or accrued in respect of this Note or the
interest represented hereby or the Conversion Shares obtainable hereunder
until, and only to the extent that, this Note shall have been converted into
Common Stock (and then only to the extent of the conversion of this Note).

8. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without regard to conflict
of law principles. Any disputes with respect to the interpretation of this Note
or the rights and obligations of the parties shall be exclusively brought in
the Unites States District Court for the Southern District of New York or if
such court lacks subject matter jurisdiction in the Supreme Court of the State
of New York, County of New York Each of the Company and the Payee waives the
right to contest the jurisdiction or venue of either of such courts or to claim
its is an inconvenient forum.

9. WAIVER OF JURY TRIAL. THE COMPANY, BY EXECUTION HEREOF, AND THE PAYEE, BY
ACCEPTANCE HEREOF, MUTUALLY AND WILLINGLY WAIVE THE RIGHT TO A TRIAL BY JURY OF
ANY AND ALL CLAIMS MADE BETWEEN THEM WHETHER NOW EXISTING OR ARISING IN THE
FUTURE, INCLUDING WITHOUT LIMIT ATION, ANY AND ALL CLAIMS, DEFENSES,
COUNTERCLAIMS, CROSS CLAIMS, THIRD PARTY CLAIMS AND INTERVENER'S CLAIMS WHETHER
ARISING FROM OR RELATED TO THE NEGOTIATION, EXECUTION AND PERFORMANCE OF THE
TRANSACTIONS TO WHICH THIS NOTE RELATES.

                 THE REMAINDER OF THIS PAGE LEFT INTENTIONALL BLANK

                                        13

<PAGE>

IN WITNESS WHEREOF, the Company has caused this Note to be executed on the day
and year first above written.

WORLD INFORMA TIONTECHNOLOGY INC.

By:
Name: Hsueh-Chu Lin
Its: President

By:  /s/ Steven Fellows
     ------------------
Name: Steven Fellows
Its: Secretary

                                          14

<PAGE>

                                                      EXHIBIT A TO THE NOTE

                            INSTRUCTIONS TO CONVERT

The undersigned hereby surrenders the attached Convertible Promissory Note
dated ______________  and due on (the "Note") of World Information Technology,
Inc, a Nevada corporation ("Company"), in the principal amount of $____________
for conversion into shares of Company's restricted Common Stock ("Common
Stock") in accordance with Section 3 of the Note relating to voluntary
conversion, as noted below. Such Note was issued pursuant to that certain
Convertible Note Agreement dated ____________, 2003 with the Company {the "Note
Agreement").  The undersigned represents that he/she/it is the beneficial owner
and Payee of record of the Note, and that no other person has any lien,
security interest or interest of any kind in the Note and that he/she/it has
full and legal right to surrender the Note for conversion.  The undersigned
further reaffirm as to the shares of Common Stock to be issued to the
undersigned pursuant to these instructions the representations and warranties
made by the undersigned set forth in Note the Agreement.

( ) The Undersigned elects to convert the full outstanding principal and
accrued interest on the Note:   $____________, which equals a conversion of
$__________.

( ) The Undersigned elects to convert the Note in part equal to a principal
amount of
$___________and accrued interest of $______________, which equals a conversion
of $_____________.  An identical Note shall be reissued for the amount of
remaining principal plus accrued interest.

Dated this ________day of ___________, ________.

In the presence of:

----------------------------------
Witness

                                          ---------------------------------
                                                Signature of Payee

                                    15

<PAGE>

                                                                 EXHIBIT C

                               INDEMNITY AGREEMENT

This INDEMNITY AGREEMENT made and entered into as of this [     ] day of July
2003 by and between World Information Technology Inc., a Nevada corporation
(the "Company") and Gary D. Morgan (the "Indemnified Party");

WHEREAS, highly competent persons are becoming more reluctant to serve or to
continue serving corporations as directors, officers, employees, agents or in
other capacities unless they are provided with adequate protection through
insurance and indemnification against inordinate risks of claims and actions
against them arising out of their service to and activities on behalf of such
corporations; and

WHEREAS, the Board of Directors of the Company has determined that the
inability to attract and retain such persons is detrimental to the best
interests of the Company's stockholders and that the Company should act to
assure such persons that there will be increased certainty of such protection
in the future; and

WHEREAS, it is reasonable, prudent and necessary for the Company contractually
to obligate itself to indemnify such persons to the fullest extent permitted by
applicable law so that they will serve or continue to serve the Company free
from undue concern that they will not be so indemnified; and

WHEREAS, the Indemnified Party is willing to serve, continue to serve and take
on additional service for or on behalf of the Company on the condition that the
Indemnified Party be so indemnified.

NOW, THEREFORE, in consideration of the premises and the covenants contained
herein, the Company and the Indemnified Party do hereby covenant and agree as
follows:

SECTION 1. Indemnification.  The Company shall indemnify the Indemnified Party
to the fullest extent permitted by the laws of the State of Nevada in effect on
the date hereof or as such laws may from time to time be amended.  Without
diminishing the scope of the indemnification provided by this Section 1, the
rights of indemnification of the Indemnified Party provided hereunder shall
include but shall not be limited to those rights hereinafter set forth, except
that no indemnification shall be paid to the Indemnified Party:

(a) on account of any suit in which judgment is rendered against the
Indemnified Party for an accounting of profits made from the purchase or sale
by the Indemnified Party of securities of the Company pursuant to the provisions
of Section l6(b) of the

                                        1

<PAGE>

Securities and Exchange Act of 1934, as amended from time to time, or similar
provisions of any federal, state or local statutory law;

(b) on account of the Indemnified Party's conduct which is finally adjudged to
have been knowingly fraudulent or deliberately dishonest, or to constitute
willful misconduct;

(c) to the extent expressly prohibited by applicable law;

(d) for which payment is actually made to the Indemnified party under a valid
and collectible insurance policy or under a valid and enforceable indemnity
clause, bylaw or agreement, except in respect of any excess beyond payment
under such insurance, clause, bylaw or agreement; or

(e) if a final decision by a court having jurisdiction in the matter shall
determine that such indemnification is not lawful ( and in this respect, both
the Company and the Indemnified Party have been advised that the U.S.
Securities and Exchange Commission believes that indemnification for
liabilities arising under the federal securities laws is against public policy
and is, therefore, unenforceable and that claims for indemnification should be
submitted to the appropriate court for adjudication).

The Indemnified Party shall be entitled to the indemnification rights provided
in this Section if the Indemnified Party is a party or is threatened to be made
a party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative of investigative in nature, other than
an action by or in the right of the Company, by reason of the fact that the
Indemnified Party is or was a director, officer, employee, agent or fiduciary
of the Company, or is or was serving at the request of the Company as a
director, officer, employee, agent or fiduciary of any other entity or
enterprise, including, but not limited to, another corporation, partnership,
joint venture or trust or service with respect to employee benefit plans, or
by reason of anything done or not done by the Indemnified Party in any such
capacity . Pursuant to this Section, the Indemnified Party shall be indemnified
against all expenses, (including attorney's fees and excise taxes or penalties
under the Employee Retirement Security Act of 1974, as amended) costs,
judgments, penalties, fines and amounts paid in settlement actually and
reasonably incurred by the Indemnified Party in connection with such action,
suit or proceeding (including, but not limited to, the investigation, defense
or appeal thereof), if the Indemnified Party acted in good faith and in a
manner the Indemnified Party reasonably believed to be in or not opposed to
the best interests of the Company, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe the Indemnified Party's
conduct was unlawful.

SECTION 3. Actions by or in the Right of the Company.  The Indemnified Party
shall be entitled to the indemnification rights provided in this Section if the
Indemnified Party is a person who was or is a party or is threatened to be made
a party to any threatened, pending or

                                          2

<PAGE>

completed action, suit or proceeding brought by or in the right of the Company
to procure a judgment in its favor by reason of the fact that the Indemnified
Party is or was a director, officer, employee, agent or fiduciary of the
Company, or is or was serving at the request of the Company as a director,
officer, employee, agent or fiduciary of another entity or enterprise,
including, but not limited to, another corporation, partnership, joint venture
or trust or service with respect to employee benefit plans, or by reason of
anything done or not done by the Indemnified Party in any such capacity.
Pursuant to this Section, the Indemnified Party shall be indemnified against
all expenses (including attorney's fees and excise taxes or penalties under the
Employee Retirement Security Act of 1974, as amended), costs and amounts paid
in settlement actually and reasonably incurred by the Indemnified Party in
connection with such action, suit or proceeding (including, but not limited to,
the investigation, defense or appeal thereof) if the Indemnified Party acted in
good faith and in a manner the Indemnified Party reasonably believed to be in
or not opposed to the best interests of the Company; provided, however, that no
such indemnification shall be made in respect of any claim, issue, or matter as
to which applicable law expressly prohibits such indemnification by reason of
any adjudication of liability of the Indemnified Party to the Company, unless
and only to the extent that the court in which such action or suit was brought
shall determine upon application that, despite the adjudication of liability
but in view of all the circumstances of the case, the Indemnified Party is
fairly and reasonably entitled to indemnity for such expenses, costs and
amounts paid in settlement which such court shall deem proper.

SECTION 4. Indemnification for Costs.  Charges and Expenses of Successful
Party. Notwithstanding the other provisions of this Agreement, to the extent
that the Indemnified Party has served as a witness on behalf of the Company or
has been successful, on the merits or otherwise, in defense of any action, suit
or proceeding referred to in Sections 2 and 3 hereof, or in defense of any
claim, issue or matter therein, including, without limitation, the dismissal of
any action without prejudice, the Indemnified Party shall be indemnified
against all costs, charges and expenses (including attorneys' fees) actually
and reasonably incurred by the Indemnified Party in connection therewith.

SECTION 5. Partial Indemnification.  If the Indemnified Party is entitled under
any provision of this Agreement to indemnification by the Company for some or a
portion of the expenses (including attorneys' fees), costs, judgments, fines
and amounts paid in settlement actually and reasonably incurred by the
Indemnified Party in connection with the investigation, defense, appeal or
settlement of such suit, action, investigation or proceeding described in
Section 2 or 3 hereof, but not, however, for all of the total amount thereof,
the Company shall nevertheless indemnify the Indemnified Party for the portion
of such expenses (including attorneys' fees), costs, judgments, penalties,
fines and amounts paid in settlement actually and reasonably incurred by the
Indemnified Party to which the Indemnified Party is entitled.

SECTION 6. Presumptions and Effect of Certain Proceedings. The Secretary of the
Company shall, promptly upon receipt of the Indemnified Party's request for
indemnification, advise in writing the Board of Directors that the Indemnified
Party has made such request for indemnification. Upon making such request for
indemnification, the Indemnified Party shall be

                                          3

<PAGE>

presumed to be entitled to indemnification hereunder and the Company shall have
the burden of proof in the making of any determination contrary to such
presumption.  If the Board of Directors shall have failed to make the requested
indemnification within 20 days after receipt by the Company of such request,
the requisite determination of entitlement to indemnification shall be deemed
to have been made and the Indemnified Party shall be absolutely entitled to
such indemnification, absent actual and material fraud in the request for
indemnification. The termination of any action, suit, investigation or
proceeding described in Section 2 or 3 hereof by judgment, order, settlement or
conviction, or upon a plea of nolo contendere or its equivalent, shall not, of
itself: (a) create a presumption that the Indemnified party did not act in good
faith and in a manner which the Indemnified Party reasonably believed to be in
or not opposed to the best Interests of the Company, and, with respect to any
criminal action or proceeding, that the Indemnified Party had reasonable cause
to believe that the Indemnified Party's conduct was unlawful; or (b) otherwise
adversely affect the rights of the Indemnified Party to indemnification except
as may be provided herein.

SECTION 7. Advancement of Expenses and Costs. All reasonable expenses and costs
incurred by the Indemnified Party (including attorneys' fees, retainers and
advances of disbursements required of the Indemnified Party) shall be paid by
the Company in advance of the final disposition of such action, suit or
proceeding at the request of the Indemnified Party within twenty days after the
receipt by the Company of a statement or statements from the Indemnified Party
requesting such advance or advances from time to time. The Indemnified Party's
entitlement to such expenses shall include those incurred in connection with
any proceeding by the Indemnified Party seeking an adjudication or award in
arbitration pursuant to this Agreement. Such statement or statements shall
reasonably evidence the expenses and costs incurred by the Indemnified Party in
connection therewith and shall include or be accompanied by an undertaking by
or on behalf of the Indemnified Party to repay such amount if it is ultimately
determined that the Indemnified Party is not entitled to be indemnified against
such expenses and costs by the Company as provided by this Agreement
Indemnify or to Advance Expenses. In the event that a determination is made
that the Indemnified Party is not entitled to indemnification hereunder or if
payment has not been timely made following a determination of entitlement to
indemnification pursuant to Section 6, or if expenses are not advanced pursuant
to Section 7, the Indemnified Party shall be entitled to a final adjudication
in any appropriate court of the State of Nevada or any other court of competent
jurisdiction of the Indemnified Party's entitlement to such indemnification or
advance. Alternatively, the Indemnified Party at the Indemnified Party's option
may seek an award in arbitration to be conducted by a single arbitrator in New
York City, New York pursuant to the rules of the American Arbitration
Association, such award to be made within sixty days following the filing of
the demand for arbitration.  The Company shall not oppose the Indemnified
Party's right to seek any such adjudication or award in arbitration or any
other claim. Such judicial proceeding or arbitration shall be made de novo and
the Indemnified Party shall not be prejudiced by reason of a determination (if
so made) that the Indemnified Party is not entitled to indemnification. If a
determination is made or deemed to have been made

                                           4

<PAGE>

pursuant to the terms of Section 6 hereof that the Indemnified Party is
entitled to indemnification, the Company shall be bound by such detem1ination
and is precluded from asserting that such determination has not been made or
that the procedure by which such determination was made is not valid, binding
and enforceable. The Company further agrees to stipulate in any such court or
before any such arbitrator that the Company is bound by all the provisions of
this Agreement and is precluded from making any assertions to the contrary. If
the court or arbitrator shall determine that the Indemnified Party is entitled
to any indemnification hereunder, the Company shall pay all reasonable expenses
(including attorneys' fees) and costs actually incurred by the Indemnified
Party in connection with such adjudication or award in arbitration (including,
but not limited to, any appellant proceedings ).

SECTION 9. Notification and Defense of Claim. Promptly after receipt by the
Indemnified Party of notice of the commencement of any action, suit or
proceeding, the Indemnified Party will, if a claim in respect thereof is to be
made against the Company under this Agreement, notify the Company in writing of
the commencement thereof; but the omission to so notify the Company will not
relieve it from any liability that it may have to the Indemnified
Party otherwise than under this Agreement. Notwithstanding any other provision
of this Agreement, with respect to any such action, suit or proceeding as to
which the Indemnified Party notifies the Company of the commencement thereof:

(a) The Company will be entitled to participate therein at its own
expense; and

(b) except as otherwise provided in this Section 9(b), to the extent that it
may wish, the Company, jointly with any other indemnifying party similarly
notified, shall be entitled to assume the defense thereof, with counsel
satisfactory to the Indemnified Party. After notice from the Company to the
Indemnified Party of its election to so assume the defense thereof, the Company
shall not be liable to the Indemnified Party under this Agreement for any legal
or other expenses subsequently incurred by the Indemnified Party in connection
with the defense thereof other than reasonable costs of investigation or as
otherwise provided below; provided the Company assumes the defense with
diligence and continuity. The Indemnified party shall have the right to employ
the Indemnified Party's own counsel in such action, suit or proceeding, but the
fees and expense of such counsel incurred after notice from the Company of its
assumption of the defense thereof shall be at the expense of the Indemnified
Party unless (i) the employment of counsel by the Indemnified Party has been
authorized by the Company, (ii) the Indemnified Party shall have reasonably
concluded that there may be a conflict of interest between the Company and the
Indemnified Party in the conduct of the defense of such action or (iii) the
Company shall not in fact have employed counsel to assume the defense of the
action, in each of which cases the fees and expenses of counsel shall be at the
expense of the Company. The Company shall not be entitled to assume the defense
of any action, suit or proceeding brought by or on behalf of the Company or as
to which the Indemnified Party shall have made the conclusion provided for in
(ii) above.

                                           5

<PAGE>

(c) The Company shall not be liable to indemnify the Indemnified party under
this Agreement for any amounts paid in settlement of any action or claim
effected without its written consent.  The Company shall not settle any action
or claim in any manner that would impose any monetary obligation, penalty or
limitation on the Indemnified Party without the Indemnified Party's written
consent.  Neither the Company nor the Indemnified Party will unreasonably
withhold their consent to any proposed settlement.

SECTION 10. Other Rights to Indemnification. The indemnification and
advancement of expenses (including attorneys' fees) and costs provided by this
Agreement shall not be deemed exclusive of any other rights to which the
Indemnified Party may now or in the future be entitled under any provision of
the bylaws or Certificate of Incorporation of the Company ~ any agreement, any
vote of stockholders or Disinterested Directors, any provision of law or
otherwise.  For purposes of this Section 10 "Disinterested Director" shall
mean a director of the Company who is not or was not a party to the action,
suit, investigation or proceeding in respect of which indemnification is
being sought by the Indemnified Party.

SECTION 11. Attorneys' Fees and Other Expenses to Enforce Agreement.  In the
event that the Indemnified Party is subject to or intervenes in any proceeding
in which the validity or enforceability of this Agreement is at issue or seeks
an adjudication or award in arbitration to enforce the Indemnified Party's
rights under, or to recover damages for breach of, this Agreement, the
Indemnified Party, if the Indemnified Party prevails in whole or in part in
such action, shall be entitled to recover from the Company and shall be
indemnified by the Company against any actual expenses for attorneys' fees and
disbursements reasonably incurred by the Indemnified Party.

SECTIQN 12. Duration of Agreement. This Agreement shall continue until and
terminate upon the later of: (a) ten years after the Indemnified Party has
ceased to occupy any of the positions or have any relationships described in
Sections 2 and 3 of this Agreement; and (b) the final termination of all
pending or threatened actions, suits, proceedings or investigations to which
the Indemnified Party may be subject by reason of the fact that the Indemnified
Party is or was a director, officer, employee, agent or fiduciary of the
Company or is or was serving at the request of the Company as a director,
officer, employee, agent or fiduciary of any other entity or enterprise,
including, but not limited to, another corporation, partnership, joint venture
or trustor by reason of anything done or not done by the Indemnified Party in
any such capacity. The indemnification provided under this Agreement shall
continue as to the Indemnified Party even though the Indemnified Party may have
ceased to be a director, officer, employee, agent or fiduciary of the Company.
This Agreement shall be binding upon the Company and its successors and assigns
and shall inure to the benefit of the Indemnified Party and the Indemnified
Party's spouse, assigns, heirs, devises, executors, administrators or other
legal representatives. Nothing in this Agreement shall confer upon the
Indemnified Party the right to continue in the employment of the Company or
affect the right of the Company to tem1inate the

                                          6

<PAGE>

Indemnified Party's employment at any time in the sole discretion of the
Company, with or without cause.

SECTION 13. Severability. If any provision or provisions of this Agreement
shall be held invalid, illegal or unenforceable for any reason whatsoever, (a)
the validity, legality and enforceability of the remaining provisions of this
Agreement (including, without limitation, all portions of any paragraphs of
this Agreement containing any such provision held to be invalid, illegal or
unenforceable, that are not themselves invalid, illegal or unenforceable) shall
not in any way be affected or impaired thereby, and (b) to the fullest extent
possible, the provisions of this Agreement (including, without limitation, all
portions of any paragraph of this Agreement containing any such provision held
to be invalid, illegal or unenforceable, that are not themselves invalid,
illegal or unenforceable) shall be construed so as to give effect to the intent
manifest by the provision held invalid, illegal or unenforceable.

SECTION 14. Counterparts; This Agreement may be executed in one or more
counterparts, each of which shall for all purposes be deemed to be an original
but all of which together shall constitute one and the same Agreement. Only one
such counterpart signed by the party against whom enforceability is sought
needs to be produced to evidence the existence of this Agreement.

SECTION 15. Headings. The headings of the paragraphs of this Agreement are
inserted for convenience only and shall not be deemed to constitute part of
this Agreement or to affect the construction thereof.

SECTION 16. Modification and Waiver. No supplement, modification or amendment
of this Agreement shall be binding unless executed in writing by both parties
hereto. No waiver of any of the provisions of this Agreement shall be deemed or
shall constitute a waiver of any other provisions hereof (whether or not
similar) nor shall such waiver constitute a continuing waiver.

SECTION 17. Notices. All notices, requests, demands or other communications
hereunder, shall be in writing and shall be deemed to have been duly given if
(i) delivered by hand, courier, or personally, on the date of delivery, or (ii)
if mailed by certified or registered mail with postage prepaid, on the third
business day after the date on which it is so mailed:

(a) If to the Indemnified Party, to:

Gary D. Morgan
6535-F Parkview Drive
Boca Raton, FL  33433
Tel No: (561) 395-0929
Fax No: (561) 394-8475

                                              7

<PAGE>

with a copy to:

Proskauer Rose LLP
Address: 1585 Broadway
New York, New York 10036
Attention: David W. Sloan, Esq.
Tel No: (212) 969-3000
Fax No: (212) 969-2900

(b) If to the Company, to:

World Information Technology
2300 West Sahara Avenue, Suite 500-C
Las Vegas, NV  89102
Tel No: (702)947-0105
Fax No: (702) 947-0107

with a copy to:

Koley Jessen P .C.,
A Limited Liability Organization
One Pacific Place, Suite 800
1125 South 103rd Street
Omaha, NE  68124
Attention:  Matthew D. Masser, Esq.
Fax No: (402) 390-9005

or to such other address as may be furnished to the Indemnified Party by the
Company or to the Company by the Indemnified Party, as the case may be.

SECTION 18. Governing Law. The parties hereto agree that this Agreement shall
be governed by, construed and enforced in accordance with, the laws of the
State of Nevada.

                                        8

<PAGE>

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

WORLD INFORMATION TECHNOLOY, INC.

By:
   ---------------------
Name:  Hsueh-Chu Lin
Title: President

By:
   ---------------------
Name: Steven D. Fellows
Title: Secretary

------------------------
GARY D. MORGAN

                                              9

<PAGE>

                        ACTION IN WRITING BY SHAREHOLDERS OF
                          WORLD INFORMATION TECHNOLOGY, INC.

The undersigned, being shareholders of World Infom1ation Technology, Inc., a
Nevada Corporation (the "Corporation"), do hereby take following actions by
this instrument in writing in accordance with the laws of the State of Nevada.

A. The Employment Agreement, dated as ofJu1y 24, 2003, between this Corporation
and Gary D. Morgan and related exhibits, including the Convertible Note
Agreement, Note and Indemnification Agreement (collectively the " Agreement")
in the forms attached hereto (and ordered filed in the minute book of the
Corporation) are approved.

B.  Any officer of the Corporation is authorized and directed to execute each
of the documents referred to in A above and shall take such other action and
execute such other instruments as maybe deemed necessary or advisable to
consummate the transactions contemplated thereby.

C. Ratifies the appointment of Gary D, Morgan as Chief Executive Officer and
Chairman of the Corporation and as a member of the Board of Directors; which
action has been concurrently approved by the sole Director of the Corporation.

D. Recommends, that when appointed, that the Independent Directors of the
Corporation its Compensation Committee approve the Agreement.

Executed this 24th day of July, 2003.

Signatures of Shareholders:

--------------------------------
Forever King Technology Co., LTD
(782,007 Shares)

--------------------------------
Leading Edge Development S.A,
(425,000 Shares)

--------------------------------
Modern Worldwide Internet
(914,934 Shares)

---------------------------------
JYN Seng International Technology
(5,640,000 Shares)

---------------------------------
Mei Lin Shiu
(2,000,000)

---------------------------------
Top of China Internet Information
(203,899 Shares)

---------------------------------
Chan Ching Tsun
(255,000 Shares)

<PAGE>

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