Document:

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                                                                   Exhibit 10.23

                             DISTRIBUTION AGREEMENT

     THIS DISTRIBUTION AGREEMENT is entered into as of the 9th day of December
2005, by and between VALERA PHARMACEUTICALS, INC., a corporation incorporated
under the laws of the state of Delaware with its principal place of business
located at 7 Clarke Drive, Cranbury, New Jersey 08512-3617 U.S.A. ("VALERA"),
and TEVA-TUTEUR, a company organized under the laws of Argentina with its
principal place of business located at Encarnacion Ezcurra 365., 3rd floor, 1107
Buenos Aires, Argentina ("TEVA-TUTEUR").

                                   BACKGROUND

     WHEREAS, Teva-Tuteur is engaged in the marketing, sale and distribution of
various pharmaceutical products used in the treatment of cancer in Argentina;

     WHEREAS, Valera wishes to appoint Teva-Tuteur as the exclusive distributor
of the Product in the Territory (as defined below) for use in the same
indications for which Valera owns or controls an approval from the United States
Food and Drug Administration or similar agency of a foreign government, the
whole in accordance with the terms and conditions set forth in this Agreement;
and

     WHEREAS, Teva-Tuteur desires Valera to supply Teva-Tuteur with the Product
on an exclusive basis in the Territory prior to Regulatory Approval (as defined
below), and following receipt of Regulatory Approval, for distribution and sale
in the Territory for use in the indications described above, the whole in
accordance with the terms and conditions set forth in this Agreement.

                                      TERMS

     NOW, THEREFORE, in consideration of the respective covenants, agreements,
representations, warranties and indemnities contained in this Agreement and for
other good and valuable consideration, Teva-Tuteur and Valera hereby covenant
and agree as follows:

                   ARTICLE 1 - DEFINITIONS AND INTERPRETATION

     1.1 DEFINITIONS. For the purposes of this Agreement or any notice, consent,
authorization or other communication required or permitted to be given under
this Agreement, the following expressions shall have the following meanings,
respectively, unless the context otherwise requires:

               (a) "AFFILIATE" shall mean any Person which directly or
indirectly controls, is controlled by, or is under common control with another
Person, provided that "control" shall mean ownership as to more than fifty
percent (50%) of another Person or the power to direct decisions of another
Person, including, without limitation, the power to direct management and
policies of another Person, whether by reason of ownership, by contract or
otherwise.

               (b) "AGREEMENT" shall mean this Distribution Agreement, as
amended from time to time.

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               (c) "TEVA-TUTEUR RELEASEES" shall be as defined in Section 10.2.

               (d) "BUSINESS DAY" shall mean any day other than a Saturday,
Sunday or other day on which the branches of the Federal Reserve Bank with
jurisdiction over the then-current principal place of business by Valera is not
open for business.

               (e) "CALENDAR QUARTER" shall mean each three-month period
commencing January 1, April 1, July 1 and October 1 of each year during the term
of this Agreement.

               (f) "CALENDAR YEAR" shall mean the period from January 1st to
December 31st in a given year.

               (g) "CMC INFORMATION" shall mean the chemistry, manufacturing,
and control information filed by Valera from time to time with the FDA with
respect to the Product.

               (h) "COMMERCIAL SALE" means any sale or distribution of the
Product by Teva-Tuteur or its Affiliates to a Third Party, other than
distribution in connection with clinical trials of the Product conducted by or
on behalf of Teva-Tuteur.

               (i) "COMPETING PRODUCT" shall be as defined in Section 3.5.

               (j) "CONFIDENTIAL INFORMATION" shall be as defined in Section
12.1.

               (k) "DEVELOPMENT PLAN" shall have the meaning set forth in
Section 2.3.

               (l) "DOLLAR" and the symbol "$" shall mean lawful money of the
United States.

               (m) "EFFECTIVE DATE" shall mean the date first written above.

               (n) "EVENT OF FORCE MAJEURE" shall have the meaning set forth in
Section 14.1.

               (o) "FDA" means the United States Food and Drug Administration
and any successor thereto.

               (p) "FORECAST" shall be as defined in Section 6.3.

               (q) "GMPS" shall mean then-current Good Manufacturing Practices
as required under the rules and regulations of the FDA.

               (r) "GOVERNMENTAL BODY" shall mean (i) any national, federal,
provincial, state, municipal or other government or body with jurisdiction over
all or any part of the Territory, (ii) any subdivision, ministry, department,
secretariat, bureau, agency, commission, board, instrumentality or authority of
any of the foregoing governments or bodies, (iii) any quasi-governmental or
private body exercising any regulatory, expropriation or taxing authority

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under or for the account of any of the foregoing governments or bodies, or (iv)
any domestic or foreign judicial, quasi-judicial, arbitration or administrative
court, grand jury, tribunal, commission, board or panel of any of the foregoing
governments or bodies.

               (s) "IMPLANT" means Valera's proprietary histrelin implant
marketed in the United States under the trademark Vantas(R).

               (t) "IMPLANTATION DEVICE" means the TROCAR device that is used to
insert the Implant into a human body.

               (u) "IMPROVEMENTS" shall mean any re-formulations,
line-extensions or other advances in, modifications or improvements to the
Product for use in an Indication.

               (v) "INDEMNIFIED PARTY" shall be as defined in Section 10.3.

               (w) "INDEMNIFYING PARTY" shall be as defined in Section 10.3.

               (x) "INDICATION" shall mean an indication for which the Implant
is approved for marketing and sale, the approval of which issued by the FDA or
similar agency of a foreign government is owned or controlled by Valera. As of
the Effective Date, the only indication for which the Implant has been approved
for marketing and sale in the United States is the treatment of hormone
responsive prostate cancer.

               (y) "LABELS" shall mean (i) all labels and other written,
printed, or graphic matter upon the Product or any packaging, container or
wrapper utilized with the Product, in each case when sold for use in the United
States and (ii) any written material accompanying the Product, including without
limitation, any package inserts, in each case when sold for use in the United
States.

               (z) "LAWS" shall mean:

                    (i) all constitutions, treaties, laws, statutes, codes,
ordinances, orders, decrees, rules, regulations, and municipal by-laws, whether
domestic, foreign or international, including any such constitutions, etc. of
any Governmental Body;

                    (ii) all judgments, orders, writs, injunctions, decisions,
rulings, decrees and awards of any Governmental Body; and

                    (iii) all policies, practices and guidelines of any
Governmental Body, in each case binding on or affecting the Party or Person
referred to in the context in which such word is used; and "Law" shall mean any
one of them.

               (aa) "LOSSES" shall mean liabilities, damages, costs or expenses,
including reasonable fees and expenses of attorneys and other professionals, as
well as court costs.

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               (bb) "MARKETING APPROVAL APPLICATION" shall mean an application
or registration filed with a Regulatory Authority seeking the approval to
market, distribute and sell the Product in the jurisdiction controlled by such
Regulatory Authority.

               (cc) "MARKETING PLAN" shall have the meaning set forth in Section
3.9.

               (dd) "MATERIAL BREACH" shall mean any breach of the terms of this
Agreement of such a nature as to have a material effect on the non-breaching
Party.

               (ee) "PARTIES" shall mean Teva-Tuteur and Valera, collectively.

               (ff) "PARTY" shall mean either Valera or Teva-Tuteur, as the
context requires.

               (gg) "PERSON" shall mean an individual, corporation, limited
liability company, co-operative, partnership, organization or any similar
entity.

               (hh) "PLAN" shall be as defined in Section 2.3.

               (ii) "PRODUCT" shall mean all dosage strengths and forms of the
Implant in its final finished form along with the Implantation Device, all
Labels and any and all Improvements. As of the Effective Date, the dosage of the
Implant for use in the treatment of hormone responsive prostate cancer is 50 mg
of histrelin.

               (jj) "PROMOTIONAL MATERIALS" shall mean all promotional
materials, detail aids and pieces, journal ads, films, artwork and graphics, and
any other marketing literature and information relating to the marketing,
distribution or sale of the Product for use in an Indication outside of the
Territory.

               (kk) "PURCHASE ORDER" shall be as defined in Section 6.1.

               (ll) "PURPOSE" shall be as defined in Section 12.2.

               (mm) "REGULATORY APPROVAL" shall mean, with respect to the
Territory and an Indication, the approval by all Regulatory Authorities of the
Marketing Approval Application and the receipt by Teva-Tuteur of the other
approvals, licenses, registrations and authorizations of all Regulatory
Authorities necessary for the marketing, distribution and sale of the Product in
the Territory for use in such Indication.

               (nn) "REGULATORY AUTHORITY" shall mean each and every
Governmental Body from which approvals are required for the marketing,
distribution or sale of the Product in the Territory.

               (oo) "SPECIFICATIONS" shall mean the specifications for the
Product approved by the FDA for use in the relevant Indication.

               (pp) "TAXES" shall be as defined in Section 7.2.3.

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               (qq) "TERM" shall mean the time period from the Effective Date
until the expiration or earlier termination of this Agreement.

               (rr) "TERRITORY" shall mean Argentina.

               (ss) "THIRD PARTY" means any Person other than a Party or an
Affiliate of a Party.

               (tt) "TRADEMARKS" shall mean, subject to Article 4, all
trademarks and trade names and trade dresses (whether registered or not) owned
by Valera or its Affiliates and approved by Valera for use in the marketing,
distribution and sale of the Product in the Territory for use in a particular
Indication.

               (uu) "TRANSFER FEE" shall be as defined in Section 7.1.

               (vv) "VALERA RELEASEES" shall be as defined in Section 10.1.

               (ww) "WARRANTY PERIOD" shall be as defined in Section 8.4.

     1.2 INTERPRETATION. The division of this Agreement into Articles and the
insertion of headings are for convenience of reference only and shall not affect
the interpretation of this Agreement. In this Agreement, words importing the
singular number only shall include the plural and vice versa and words importing
gender shall include all genders.

             ARTICLE 2 - PRODUCT DEVELOPMENT AND REGULATORY APPROVAL

     2.1 REGULATORY APPROVAL. In accordance with the terms and subject to the
conditions herein specified, Teva-Tuteur shall apply for each Regulatory
Approval for the Product in the Territory for use in each Indication.
Teva-Tuteur hereby agrees to use commercially reasonable efforts in applying for
each such Regulatory Approval, which shall be held in the name of Valera or an
Affiliate of Valera to the extent permitted by the applicable Regulatory
Authority and if not so permitted, in the name of Teva-Tuteur. Valera's only
obligations in regards to the Regulatory Approval effort shall be for Valera to:
(a) provide to Teva-Tuteur the information and data required by Section 2.2; (b)
make personnel available for telephone calls with Teva-Tuteur and Regulatory
Authorities as Valera determines in its sole discretion; and (c) supplying a
reasonable quantity of the Product for use in clinical trials as set forth in
this Agreement. If Teva-Tuteur desires or requires more assistance or resources
from Valera in relation to the Regulatory Approval effort, it may request such
resources and Valera will determine in its sole discretion whether it will
provide such resources and the cost to Teva-Tuteur of providing such resources.

     2.2 FURNISHING DATA. Valera shall supply Teva-Tuteur with all data and
information in its possession or control as is necessary for the purpose of
obtaining Regulatory Approval for the Product in the Territory for use in each
Indication, including, but not limited, to clinical and non-clinical study data,
results and reports (including toxicology reports) and/or CMC information
including, where required, a reasonable number of samples for actual testing by
Regulatory Authorities. Without limiting the generality of the foregoing and to
the extent legally permitted, Valera shall provide Teva-Tuteur with access to
and the right to cross-reference

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existing regulatory filings for the Product submitted by it and/or its
Affiliates or designated nominees in any jurisdiction outside of the Territory.
At the request of Teva-Tuteur and to the extent legally permitted, Valera shall
notify the Regulatory Authorities in the Territory of Teva-Tuteur's right to
reference any such regulatory filings in any application filed by Teva-Tuteur in
accordance with the terms of this Agreement.

     2.3 DEVELOPMENT AND REGULATORY APPROVAL PLAN FOR EACH INDICATION. Within
sixty (60) Business Days after the Effective Date, Teva-Tuteur shall prepare a
plan outlining all pre-clinical, clinical and regulatory activities that are
necessary for receiving Regulatory Approval for the use of the Product in the
prostate cancer Indication in the Territory and estimated time schedules for the
completion of all such activities (the "PLAN"). Generally, the Plan shall
allocate responsibility for pre-clinical and clinical activities and regulatory
activities in the Territory (including development and approval of
Territory-specific labeling for the Product) to Teva-Tuteur and shall not
allocate any responsibility to Valera other than provision of the data and
information required by Section 2.2 and the supply of the Product. The Plan
shall be subject to the review and approval of Valera, which will not be
unreasonably withheld or delayed. As new Indications become available during the
Term, Teva-Tuteur shall develop a Plan for receiving Regulatory Approval from
each Regulatory Authority in the Territory for the Product for use in such
Indication no later than sixty (60) Business Days after Valera notifies
Teva-Tuteur of the approval of the Product for marketing, sale and use in the
United States in such Indication. Each such Plan shall be subject to the review
and approval of Valera, which approval shall not be unreasonably withheld or
delayed.

     2.4 CLINICAL TRIAL DATA. All clinical and/or marketing data developed by
the Parties during the Term shall remain the property of the Party developing
such data, and any data to which both Parties have contributed to or on which
both Parties have worked shall remain the property of both jointly and severally
worldwide; provided that Valera is hereby granted a perpetual, irrevocable,
royalty-free, fully paid-up license to copy, disclose and use in any manner any
and all clinical and/or marketing data developed in the course of such trials
and not otherwise owned by Valera. The Parties agree that they will promptly
share with one another all information and reports regarding the results of any
trials.

     2.5 PHASE IV CLINICAL STUDIES. Teva-Tuteur shall have the non-exclusive
right (but not the obligation) to conduct Phase IV clinical trials relating to
the use of the Product in each Indication in the Territory, but only with the
prior written consent of Valera, which consent shall not be unreasonably
withheld or delayed.

     2.6 MAINTAINING REGULATORY APPROVAL. Teva-Tuteur undertakes to use
commercially reasonable efforts to maintain each Regulatory Approval for the
Product for use in each Indication in the Territory. All reasonable direct
out-of-pocket expenses incurred by Teva-Tuteur and/or Valera in maintaining the
registrations shall be borne or reimbursed by Teva-Tuteur.

     2.7 COPIES OF CORRESPONDENCE; NOTICE. Copies of all pertinent
correspondence related to the promotion, sale and use of the Product for use in
each Indication to and from all Regulatory Authorities and all submissions, or
pertinent excerpts thereof, to the Regulatory

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Authorities connected to the Product for use in each Indication will be
furnished by the corresponding Party to the other Party in a timely manner.

     2.8 REIMBURSEMENT. Teva-Tuteur shall, at its own expense, make all
submissions and filings to each Government Body and all other Third Parties
necessary or desirable to establish unit prices for the Product for use in each
Indication in the Territory.

             ARTICLE 3 - EXCLUSIVE DISTRIBUTION; PROMOTION AND SALES

     3.1 APPOINTMENT OF DISTRIBUTOR. Subject to the terms and conditions of this
Agreement, Valera hereby appoints Teva-Tuteur during the Term, and Teva-Tuteur
hereby accepts its appointment, as the exclusive distributor of the Product in
the Territory for use in each Indication.

     3.2 EXCLUSIVE SUPPLY. During the Term, Valera shall not supply the Product
for distribution or sale in the Territory for use in any Indication to any
Person other than Teva-Tuteur, it being understood between the Parties that
Valera shall not directly or indirectly sell, or otherwise make available, the
Product in the Territory for use in any Indication other than through
Teva-Tuteur in accordance with the terms of this Agreement. Valera shall refer
to Teva-Tuteur all orders or inquiries received by it from sources in the
Territory in connection with the Product for use in any Indication.

     3.3 RESERVATION OF RIGHTS. In no event shall this Agreement be construed to
prevent Valera from directly or indirectly: (a) manufacturing, using, marketing,
promoting, distributing and selling the Product outside the Territory for use in
any indication; or (b) entering into and performing agreements with third
parties regarding the foregoing. A breach of this Section 3.3 shall be
considered a Material Breach.

     3.4 SALES OUTSIDE THE TERRITORY; SALES WITHIN THE TERRITORY FOR USE OUTSIDE
THE TERRITORY. Teva-Tuteur shall not, and Teva-Tuteur shall cause its Affiliates
not to, directly or indirectly, without the prior written consent of Valera,
sell the Product outside the Territory, or knowingly sell the Product to any
Person within the Territory for resale or use outside of the Territory.

     3.5 COMPETING PRODUCT. Teva-Tuteur shall not, and shall cause its
Affiliates not to, directly or indirectly, jointly or in conjunction with any
other Person, whether as principal, agent, shareholder, employee, independent
contractor, or in any other manner whatsoever, develop, market, distribute or
sell in the Territory any products that contain the same active ingredient as
that which is contained in the Product, or any products similar to or
competitive with the Product, that are used in any Indication (each, a
"COMPETING PRODUCT"), during the Term and for a period of three (3) years
following the expiry or termination of this Agreement. The Parties acknowledge
that a product that is indicated for use in the treatment of hormone resistant
prostate cancer is not a Competing Product.

     3.6 SUBCONTRACTING. The Parties acknowledge and agree that, subject to
prior written notification to and acceptance from the appropriate Regulatory
Authority, each Party shall have the right, at its sole expense, to subcontract
with Third Parties or Affiliates for the performance of its obligations
hereunder, upon prior written approval of the other Party where the

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subcontractor is a Third Party (which approval shall not be unreasonably
withheld or delayed); provided, however, that each Party shall remain
responsible to the other Party for (a) assuring that each subcontractor complies
with all applicable provisions of this Agreement and all applicable Laws and (b)
fulfilling all of its obligations hereunder; and provided further that
Teva-Tuteur shall have no right to approve or disapprove of any contract
manufacturer or contract packager engaged by Valera. In the event that any
subcontracting by Valera would have a material impact on Teva-Tuteur's
responsibilities to the appropriate Regulatory Authority and to the extent
reasonably possible, Valera will inform Teva-Tuteur at least six (6) months
prior to arranging for any such subcontracting.

     3.7 PRODUCT PROMOTION. Teva-Tuteur shall employ its best efforts to market,
distribute and sell the Product in the Territory for use in each Indication and
shall bear all costs and expenses incurred in connection with such efforts. The
Parties agree to meet at either Party's request in order to discuss any
marketing, distribution and sales issues.

     3.8 PROMOTIONAL MATERIALS. Valera shall provide Teva-Tuteur, at no
additional cost, with samples of all Promotional Materials owned by Valera to
market the Product for use in each Indication outside of the Territory; provided
that Teva-Tuteur reimburses Valera for all additional advertising agency costs,
if any, associated with supplying any artwork and graphics. Valera hereby grants
to Teva-Tuteur the right to use such Promotional Materials and, subject to
Article 4, to modify any artwork and graphics for its purpose.

     3.9 MARKETING PLAN. Commencing in the year in which Teva-Tuteur submits a
Marketing Approval Application to a Regulatory Authority within the Territory
for a particular Indication, Teva-Tuteur shall prepare, develop and submit to
Valera an annual marketing plan in relation to use of the Product for such
Indication in the Territory (each, a "MARKETING PLAN") for Valera's review and
approval by no later than the 15th of February of each year during the Term for
the then-current Calendar Year. The Marketing Plan will outline plans for the
promotion and sale of the Product for such Indication, and will also include
recommendations for Product pricing, reimbursement status and activities,
positioning, and a description of the promotional programs, if any, planned for
the relevant Calendar Year. Valera, acting in good faith, shall have thirty (30)
Business Days from the date of receipt to review each Marketing Plan and suggest
commercially reasonable changes. Teva-Tuteur shall make commercially reasonable
efforts to include any changes in the Marketing Plan suggested by Valera and
shall advise, in writing, within fifteen (15) Business Days which changes it has
incorporated together with an explanation as to any changes that were suggested
by Valera but not incorporated. In the event that Valera does not respond to
Teva-Tuteur within thirty (30) Business Days of the receipt of a Marketing Plan,
such Marketing Plan will be deemed to be acceptable to Valera. Notwithstanding
anything else contained herein to the contrary, at the request of either Party,
the Parties shall meet semi-annually to review proposed marketing plans for the
Product.

     3.10 SUBDISTRIBUTORS. Teva-Tuteur may appoint subdistributors on the
express conditions that: (a) Teva-Tuteur enters into a written agreement with
the subdistributor that binds the subdistributor to compliance with all the
terms and conditions of this Agreement applicable to Teva-Tuteur; and (b) no
later than ten (10) days after entering into any such agreement, Teva-Tuteur
also provides Valera with a full copy of the agreement referred to in clause
(a). Appointment of a subdistributor shall not relieve Teva-Tuteur of any of its
obligations under this

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Agreement. Teva-Tuteur shall be liable for any subdistributor's failure to
perform any term or condition of this Agreement as if Teva-Tuteur itself
breached the applicable term or condition of this Agreement.

                        ARTICLE 4 - BRANDING; TRADEMARKS

     4.1 LICENSE GRANT; BRANDING. Subject to the terms and conditions of this
Agreement, Valera hereby grants Teva-Tuteur an exclusive license to use the
Trademarks in connection with the marketing, distribution, and sale of the
Product in the Territory for use in each Indication. The Product shall bear a
product name owned by and registered as a trademark in the Territory toValera,
which product name shall, if possible, be the same as the product name used in
the United States (but may vary by Indication), as well as certain other
trademarks of Valera and trademarks of Teva-Tuteur (such as company names and
logos but expressly excluding a product name or product logo owned by or
registered as a trademark to Teva-Tuteur or any of its Affiliates) and use the
trade dress identified by Valera from time to time and approved by Teva-Tuteur;
provided, however, that all packaging shall ensure that the distinctiveness of
the trademarks of each party is maintained and include a tag line that indicates
the ownership of each Party's trademarks.

     4.2 OBLIGATIONS AND CONDITIONS. No Promotional Materials bearing the
Trademarks may be used without Valera's prior written approval, which consent
shall not be unreasonably withheld or delayed but shall be conditioned upon
maintaining the distinctiveness of the trademarks of each Party and including a
tag line that indicates Valera's ownership of the Trademarks. It is agreed by
the Parties that in the event that Valera does not respond to Teva-Tuteur's
submission of the new Promotional Materials or labeling within ten (10) Business
Days, consent shall be deemed to be granted. Notwithstanding anything to the
contrary, Teva-Tuteur's use of the Trademarks shall be conditioned upon
Teva-Tuteur's compliance with Valera's then-current quality standards, which
standards Valera may update from time to time by written notice to Teva-Tuteur,
it being understood that Teva-Tuteur may use up any packaging, labeling or
Promotional Materials that it has at the time of the update, either in stock or
in process.

     4.3 TEVA-TUTEUR'S TRADEMARKS. Teva-Tuteur hereby, for itself and on behalf
of its Affiliates, grants Valera the right to affix Teva-Tuteur's trademarks,
trade names, logos and trade dress on labeling of the Product approved by
Teva-Tuteur.

     4.4 CHANGES. Each Party may discontinue, alter or add new trademarks to be
used in connection with the labeling and marketing of the Product in the
Territory for use in any Indication; provided that: (a) the foregoing shall not
be deemed to allow Teva-Tuteur to use or place a product name owned by
Teva-Tuteur or licensed by Teva-Tuteur from a Third Party on the Product; and
(b) each Party may use up any packaging, labeling or Promotional Materials that
it has at the time of the discontinuance, alteration or addition, either in
stock or in process.

     4.5 NO OTHER RIGHTS; ALLOCATION OF GOODWILL. Except for the licenses
granted by each of Valera and Teva-Tuteur to the other under this Agreement,
neither Party shall acquire any right, title, or interest in any trademark,
trade name, logo or trade dress of the other Party by reason of this Agreement.
Each of Teva-Tuteur and Valera shall be responsible for registering,

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as necessary, its own trademarks, trade names, logos and trade dress.
Teva-Tuteur acknowledges that all use of any of Valera's trade names,
trademarks, trade dress and logos and all of the goodwill associated therewith
shall inure solely to Valera's benefit. Likewise, Valera acknowledges that all
use of any of Teva-Tuteur's trademarks, trade dress, trade names, and logos, and
all of the goodwill associated therewith shall inure solely to Teva-Tuteur's
benefit.

     4.6 CONFUSINGLY SIMILAR MARKS. Teva-Tuteur shall not authorize or undertake
any use of any mark that is confusingly similar to the Trademarks in the
Territory.

     4.7 EFFECT OF TERMINATION. Upon termination of this Agreement both parties
shall immediately cease all use of the other party's trademarks, trade names,
logos and trade dress, except as set forth in Section 13.6.

                       ARTICLE 5 - MANUFACTURE AND SUPPLY

     5.1 MANUFACTURING. Valera shall, directly or through an Affiliate or Third
Party designee (including contract manufacturers and contract packagers), have
the sole right and responsibility for manufacturing, assembling, packaging and
labeling the Product in such quantities as, in Valera's opinion, are required to
fill all orders and for maintaining such inventory levels of raw materials and
packaging components as are required to meet Teva-Tuteur's then-current forecast
for the Product (as delivered pursuant to Section 6.3).

     5.2 LABELING. The Product supplied under this Agreement will be the Product
packaged for use in the United States including all Labels for use in the United
States. Teva-Tuteur shall be responsible for making changes to the labeling and
packaging necessary to comply with all Regulatory Approvals (including, without
limitation, oversticking labels on the Labels or repackaging the Product using
labels, package inserts and documentation other than or in addition to the
Labels) and bear all costs related to the same. From time to time, and in any
event promptly following Valera's request, Teva-Tuteur shall notify Valera of
all labeling and repackaging activities undertaken by or on behalf of
Teva-Tuteur to comply with all Regulatory Approvals in the Territory.

     5.3 DOCUMENTATION AND CERTIFICATE OF ANALYSIS. Valera shall provide
Teva-Tuteur with required supporting documentation for the manufacture and
packaging of the Product in a form suitable for Teva-Tuteur's submission to the
Regulatory Authorities. A certificate of analysis and full set of batch
manufacturing records shall be delivered with each batch of the Product
delivered to Teva-Tuteur.

     5.4 IMPROVEMENTS; NEW FORMULATION. Valera shall furnish Teva-Tuteur with
all information pertinent to the marketing, sale and promotion of the Product
relating to any Improvements, which Valera may make from time to time to the
Product, or to any new formulation of the Product. To the extent reasonably
possible, Valera shall provide Teva-Tuteur with six (6) months prior written
notice of any anticipated Improvements or new formulations.

     5.5 SHELF LIFE. Each unit of the Product will have a remaining shelf life
of at least eighteen (18) months at the time of shipment to Teva-Tuteur.

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     5.6 COMPLIANCE WITH LAWS. Teva-Tuteur shall comply with all applicable Laws
in relation to the handling, storage, distribution and sale of the Product in
the Territory and Valera's then-current instructions relating to handling,
storage and shipment of the Products in the Territory.

              ARTICLE 6 - FORECASTS/ORDERING/TITLE AND RISK/RETURNS

     6.1 ORDERING. Teva-Tuteur may order units of the Product by issuing binding
purchase orders (each, a "PURCHASE ORDER") to Valera pursuant to the terms of
this Agreement. Each Purchase Order shall state the quantity of the Product to
be purchased, delivery date(s) and routing instructions, destination or
destinations. No different or additional terms or conditions on any purchase
order, acknowledgment or other transmittal, whether a standard business form or
otherwise, utilized by Teva-Tuteur or Valera in connection with the sale of the
Product shall be construed or deemed to be an amendment of or supplement to this
Agreement or otherwise binding on either Teva-Tuteur or Valera.

     6.2 ACCEPTANCE OR REJECTION OF PURCHASE ORDERS. Valera shall indicate its
acceptance or rejection of each Purchase Order within ten (10) Business Days
after receipt; provided that Valera may reject a Purchase Order, in whole or in
part, only if: (a) the Purchase Order fails to comply with the terms and
conditions of this Agreement; (b) the delivery date is less than one hundred
fifty (150) days from the date of Valera's receipt of such Purchase Order; or
(c) if the volume under the Purchase Order and all other accepted Purchase
Orders covering the applicable monthly period exceeds the volume set forth in
Teva-Tuteur's then-current forecast (delivered pursuant to Section 6.3) by more
than ten percent (10%). If requested by Teva-Tuteur following Teva-Tuteur's
receipt of Valera's rejection notice under clause (c) above, Valera will use
commercially reasonable efforts to deliver the excess volume of the Product
specified in the rejected Purchase Order, but Valera's failure to so deliver the
excess volume shall not be a breach of this Agreement. Valera's sole obligation
in filling accepted Purchase Orders shall be to use commercially reasonable
efforts to fill Teva-Tuteur's orders for the Product. In no event shall Valera
be liable to Teva-Tuteur or any third party for Valera's failure to deliver the
Product to Teva-Tuteur by any delivery due date set forth in any Purchase Order.

     6.3 FORECASTS. Teva-Tuteur shall provide Valera a non-binding twelve (12)
month rolling forecast (the "FORECAST") of Teva-Tuteur's estimated requirements
of the Product. The Forecast shall be reviewed and updated by Teva-Tuteur no
later than thirty (30) days before the start of each calendar quarter during the
Term. Each such Forecast shall reflect a good faith attempt by Teva-Tuteur to
estimate quantity requirements of the Product, based on anticipated demand
therefor.

     6.4 MINIMUM PURCHASE COMMITMENT.

          6.4.1. Notwithstanding anything in the contrary in this Agreement the
foregoing, in each of the Calendar Years described in the table below
Teva-Tuteur will take delivery of at least the number of units of the Product
set forth in the table below for such Calendar Year (and place orders sufficient
for such deliveries to occur):

<PAGE>

                                                                              12

<TABLE>
<CAPTION>
          CALENDAR YEAR
(AFTER THE FIRST COMMERCIAL SALE)   MINIMUM NUMBER OF UNITS OF PRODUCT
---------------------------------   --------------------------------------------
<S>                                 <C>
First Calendar Year                                  700
Second Calendar Year                               1,000
Third Calendar Year                                1,200
Each Calendar Year thereafter       The higher of 1,200 or 95% of the total
                                    number of units of Products delivered during
                                    the preceding Calendar Year
</TABLE>

          6.4.2. If Teva-Tuteur believes that it will be unable, for any reason,
to satisfy its obligation under Section 6.4.1 during a given Calendar Year,
Teva-Tuteur must notify Valera of such fact no later than one hundred twenty
(120) days prior to the completion of the given Calendar Year. If Teva-Tuteur
timely provides such notice, then: (a) Teva-Tuteur shall be relieved of its
obligation under Section 6.4.1 for the given Calendar Year; but (b) Valera shall
have the option of (i) converting all of the exclusive rights granted to
Teva-Tuteur in this Agreement into non-exclusive rights effective as of the date
of Teva-Tuteur's notice to Valera or such later date as Valera may specify or
(ii) terminating this Agreement effective as of the date of Teva-Tuteur's notice
to Valera or such later date as Valera may specify. If Teva-Tuteur does not
provide the notice permitted by this Section 6.4.2 or does so after the period
specified in this Section 6.4.2, Teva-Tuteur shall not be relieved of its
obligations under Section 6.4.1.

     6.5 SHIPMENT. Valera will use diligent efforts to ship the Product ordered
by Teva-Tuteur within one hundred and fifty (150) days after its acceptance of
Teva-Tuteur's purchase order. The Products will be shipped EXW (Incoterms 2000)
Valera's or its Third Party designee's facilities. Valera shall ensure that the
Product is suitably packed for shipment in standard containers.

     6.6 VALERA'S PRODUCT LIABILITY INSURANCE. Valera agrees to maintain product
liability insurance consistent with its normal business practices to cover risks
related to the Product and, upon Teva-Tuteur's request from time to time, to
provide Teva-Tuteur with certificates of insurance attesting to the existence of
such insurance. Valera shall name Teva-Tuteur as an additional insured under the
foregoing insurance policy.

     6.7 TEVA-TUTEUR'S PRODUCT LIABILITY INSURANCE. Teva-Tuteur agrees to
maintain product liability insurance to cover risks related to its activities
(or activities undertaken on its behalf) with respect to the labeling,
packaging, storage, marketing, sales, and distribution of the Product in the
Territory with a limit of liability of at least $5,000,000 in the aggregate.
Upon request by Valera, Teva-Tuteur will provide Valera with a certificate of
insurance attesting to the existence of such insurance. Teva-Tuteur shall name
Valera as an additional insured under the foregoing insurance policy.
Teva-Tuteur will cause its sublicensees to comply with this Section 6.7 as if
the sublicensee were Teva-Tuteur.

     6.8 INSURANCE NOTIFICATION. Each Party agrees, upon request, to advise the
other Party of the status of the insurance required by this Article 6 and of any
change in such status. It is understood and agreed that furnishing of such
insurance coverage will not relieve either Party of their obligations under this
Agreement.

<PAGE>

                                                                              13

                   ARTICLE 7 - TRANSFER FEE AND PAYMENT TERMS

     7.1 TRANSFER FEE. Teva-Tuteur shall pay Valera a transfer fee for each unit
of the Product supplied by Valera to Teva-Tuteur or its Affiliates or
sublicensees under this Agreement (the "TRANSFER FEE"). Until twelve (12) months
following the first Commercial Sale of the Product in the Territory, the
Transfer Fee shall be USD$850 per unit of the Product. After twelve (12) months
following the first Commercial Sale of the Product in the Territory, Valera may
adjust the Transfer Fee once per Calendar Year by giving Teva-Tuteur written
notice of the adjusted Transfer Fee, except that no increase shall exceed the
aggregate percentage increase in the Producer Price Index for Drugs and
Pharmaceuticals (Series WPU063), as reported by the Bureau of Labor Statistics
of the United States Department of Labor, during the period since the last price
adjustment (and for which data, preliminary or final, is available).

     7.2 PAYMENT.

          7.2.1. Teva-Tuteur shall pay for the Product as follows: (a) at the
time of ordering Product, an amount equal to twenty five percent (25%) of the
gross selling price of the Product so ordered (i.e. the number of units of
Product ordered multiplied by the then-current Transfer Fee multiplied by twenty
five percent (25%)); (b) no later than thirty days (30) days after the date of
Valera's invoice for the Product so ordered and delivered, an amount equal to
fifty percent (50%) of the gross selling price of the Product so ordered and
delivered (i.e. the number of units of Product ordered and delivered multiplied
by the then-current Transfer Fee multiplied by fifty percent (50%)); and (c) no
later than forty five (45) days after the date of Valera's invoice for the
Product so ordered and delivered, the balance of such invoice. Teva-Tuteur shall
pay all amounts due under this Agreement by wire transfer in Dollars to such
bank as Valera may direct from time to time. Overdue amounts shall bear interest
at a rate equal to the lower of 1.5% per month or the highest rate permitted by
law from the due date until the date paid. All expenses incurred by Teva-Tuteur
in making such transfers shall be borne by Teva-Tuteur.

          7.2.2. The parties acknowledge that it is an essential that all
payments to Valera be timely made in United States Dollars in the banks
indicated by Valera from time to time, irrespective of the legislation in force
in Argentina after Law 25.561 (whose principles the parties declare to know and
understand). Teva-Tuteur assumes all currency risks related with the currency
exchange rates, and expressly declares that it has carefully evaluated all such
risks and that the extension of this provision is reasonable and acceptable to
Teva-Tuteur. If a payment in US Dollars or to the bank specified by Valera shall
turn out to be impossible or illegal, Teva-Tuteur shall satisfy its payment
obligations by providing Valera with an amount of Argentine Pesos (or whatever
legal currency shall be in force in Argentina at the time of each payment)
necessary to purchase, in the Buenos Aires Stock Exchange, or in the Mercado
Abierto Electronico, or in any other stock exchange selected by Valera, Floating
Rate Bonds (FRB) and/or Par Bonds and/or Discount Bonds and/or any other bond,
title, stock, etc., denominated in US Dollars, that may be sold in New York,
Montevideo, or other market at the election of the recipient of the funds, so
that once they are sold and after the payment of all commissions and other
expenses, Valera obtains the exact amount of US Dollars necessary to satisfy the
payment obligation.

<PAGE>

                                                                              14

          7.2.3. Any and all payments by Teva-Tuteur to or for the account of
Valera under this Agreement shall be made without deduction for any and all
present or future taxes, duties, levies, imposts, deductions, charges or
withholdings imposed, assessed, levied or collected by any taxing authority
within the Territory (the "TAXES"); provided that, if Teva-Tuteur shall be
required by law to deduct any Taxes from any such payments: (a) the sum payable
to Valera shall be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section) Valera receives an amount equal to the sum it would have received
had no such deductions been made; (b) Teva-Tuteur shall make such deductions;
(c) Teva-Tuteur shall pay the full amount deducted to the relevant taxation
authority or other authority in accordance with applicable law; and (d)
Teva-Tuteur shall furnish to Valera the original, or a certified copy, of a
receipt evidencing payment thereof.

          7.2.4. Unless otherwise agreed by Valera, Teva-Tuteur shall obtain a
confirmed, irrevocable letter of credit in favor of Valera in an amount set by
Valera from time to time, against which Valera may draw if Teva-Tuteur fails to
pay any amount due under this Agreement. Such letter of credit shall be in form
and substance acceptable to Valera, shall be issued by a bank acceptable to
Valera and shall be payable in Dollars upon presentation of the documentation
recited in the letter of credit.

     7.3 RECORDS. Teva-Tuteur shall record all sales of Product and shall keep
full and true books of account and other records in accordance with the
requirements of generally accepted accounting principles in the United States,
consistently applied, and other good business practice.

                         ARTICLE 8 - PRODUCT WARRANTIES

     8.1 LIMITED WARRANTY FOR THE PRODUCTS. Valera warrants to Teva-Tuteur that:
(a) each Product will be manufactured and packaged in accordance with GMPs; (b)
each of the Products, when delivered to the carrier, will conform to the
Specifications; and (c) each of the Products shall be free from defects in
materials, workmanship and packaging at the time of delivery to the carrier.

     8.2 DISCLAIMER. THE EXPRESS LIMITED WARRANTY FOR THE PRODUCTS SET FORTH IN
SECTION 8.1 AND THE ADDITIONAL REPRESENTATIONS AND WARRANTIES SET FORTH IN
SECTION 9.1 ARE IN LIEU OF ALL OTHER REPRESENTATIONS AND WARRANTIES, WHETHER
EXPRESS OR IMPLIED. VALERA HEREBY DISCLAIMS ANY AND ALL OTHER REPRESENTATIONS
AND WARRANTIES OF ANY KIND, EXPRESSED OR IMPLIED, WHETHER ARISING FROM A COURSE
OF DEALING OR USAGE OF TRADE, INCLUDING, WITHOUT LIMITATION, THE IMPLIED
WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND
NON-INFRINGEMENT.

     8.3 WARRANTY CLAIM PROCEDURE. Unless otherwise agreed by Valera, to make a
warranty claim, Teva-Tuteur shall at Teva-Tuteur's expense return the allegedly
defective the Products(s), or a representative sample thereof, together with a
description of the alleged defect. Valera shall, promptly after receipt and as
required, inspect the alleged defective Products(s). If

<PAGE>

                                                                              15

such inspection results reasonably confirm the Products do not conform with the
warranties set forth in Section 8.1 and the non-conformance did not arise from
misuse, mishandling, storage in a manner inconsistent with Valera's directions,
neglect, modification or unusual physical or chemical stress after delivery to
the carrier, Teva-Tuteur shall return any remaining the Products(s) in
Teva-Tuteur's inventory with the same defect at Valera's expense, and the sole
and exclusive warranty remedies set forth in Section 8.4 shall apply. If such
test results fail to confirm the Products' non-conformance to the warranties set
forth in Section 8.1, or if the parties fail to otherwise resolve the dispute,
the parties shall submit the Products, or a representative sample thereof, along
with a reference batch which has previously been shown by Teva-Tuteur to conform
to the warranties set forth in Section 8.1, to a mutually acceptable independent
laboratory along with mutually agreeable interrogatories to be answered by such
laboratory. The determination of the Products' conformance or non-conformance to
the warranties set forth in Section 8.1 shall be binding upon the Parties. If
the laboratory determines that the Products conform to the warranties set forth
in Section 8.1, Teva-Tuteur shall pay all independent laboratory and shipping
costs incurred by Valera, and if such laboratory confirms that the Products do
not conform with the warranties set forth in Section 8.1, Valera shall pay all
independent laboratory costs and the sole and exclusive warranty remedies set
forth in Section 8.4 shall apply.

     8.4 TEVA-TUTEUR'S WARRANTY REMEDIES. Teva-Tuteur must make a claim for
breach of any other warranties set forth in Section 8.1 no later than one (1)
year after shipment of the unit of Product to Teva-Tuteur claimed to be
defective (the "WARRANTY PERIOD"). Valera shall replace, at Valera's expense, or
at Teva-Tuteur's option, refund or credit the Transfer Fee for, any of the
Products that do not comply with Valera's limited warranty set forth in Section
8.1 and reported to Valera during the Warranty Period (and confirmed to be
defective pursuant to Section 8.3). Valera's obligation to replace defective
Product or to refund or credit the purchase price paid for such the Products
pursuant to this Section 8.4 shall not apply to any Product that has been
subjected to misuse, mishandling, storage in a manner inconsistent with Valera's
directions, neglect, modification or unusual physical or chemical stress after
delivery to the carrier. Other than with respect to third party claims for which
Valera must indemnify Teva-Tuteur pursuant to Section 10.2, this Section 8.4
states Teva-Tuteur's sole and exclusive remedy for failure of any the Products
to comply with the limited warranties set forth in Section 8.1.

              ARTICLE 9 - REPRESENTATIONS AND ADDITIONAL WARRANTIES

     9.1 REPRESENTATIONS AND WARRANTIES OF VALERA. Valera hereby makes the
following representations and warranties to Teva-Tuteur and does so in full
understanding and acknowledgement that Teva-Tuteur is relying on such
representations and warranties in entering into this Agreement, notwithstanding
any due diligence investigation done or information obtained by Teva-Tuteur
prior to the Effective Date:

               (a) STATUS. Valera is a corporation organized and existing under
the Laws of the State of Delaware, U.S.A. No action has been taken by the
directors, officers or shareholders of Valera to dissolve the corporation.
Valera has the corporate power and authority to enter into this Agreement and to
perform all its obligations under this Agreement.

<PAGE>

                                                                              16

               (b) ALL NECESSARY PROCEEDINGS. The execution and delivery by
Valera of this Agreement, the performance by Valera of all the terms and
conditions thereof to be performed by it and the consummation of the
transactions contemplated hereby have been duly authorized by all necessary
corporate actions and proceedings, and no other act or approval of any Person is
required to authorize such execution, delivery, and performance.

               (c) NO VIOLATION. The execution, delivery and performance of this
Agreement by it: (i) does not violate or conflict with any provision of Law or
any provision of its articles of incorporation or by-laws; and (ii) does not and
will not, with or without the passage of time or the giving of notice, result in
the breach of, or constitute a default, cause the acceleration of performance,
or require any consent under, or result in the creation of any lien, charge or
encumbrance upon any of its property or assets pursuant to any material
instrument or agreement to which it is a party or by which it or its properties
may be bound or affected. Without limiting the generality of the foregoing,
Valera has not made any written or oral agreement or undertaking with any other
Person regarding the rights to promote, distribute or sell the Product or to
seek Regulatory Approval for the Product in the Territory.

               (d) THIRD PARTY CLAIMS. To Valera's knowledge, as of the
Effective Date, there is no outstanding or threatened claim or allegation that
the marketing, distribution or sale of the Product or use of the Trademarks in
accordance with this Agreement infringe upon any rights of a Third Party in the
Territory.

               (e) REGULATORY APPROVAL. As of the Effective Date of this
Agreement, Valera is not aware of any facts that would reasonably lead it to
conclude that the Product will be unable to receive Regulatory Approval in the
Territory.

     9.2 REPRESENTATIONS AND WARRANTIES OF TEVA-TUTEUR. Teva-Tuteur hereby makes
the following representations and warranties to Valera and does so in full
understanding and acknowledgement that Valera is relying on its said
representations and warranties in entering into this Agreement, notwithstanding
any due diligence investigation done or information obtained by Valera prior to
the Effective Date:

               (a) STATUS. Teva-Tuteur is a limited liability company organized
and existing under the Laws of Buenos Aires, Republic of Argentina. No action
has been taken by the directors, officers or shareholders of Teva-Tuteur to
dissolve the corporation. Teva-Tuteur has the corporate power and authority to
enter into the present Agreement.

               (b) ALL NECESSARY PROCEEDINGS. The execution and delivery by
Teva-Tuteur of this Agreement, the performance by Teva-Tuteur of all the terms
and conditions thereof to be performed by it and the consummation of the
transactions contemplated hereby have been duly authorized by all necessary
corporate actions and proceedings, and no other act or approval of any Person is
required to authorize such execution, delivery, and performance.

               (c) NO VIOLATION. Teva-Tuteur warrants that the execution,
delivery and performance of this Agreement by it: (i) does not violate or
conflict with any provision of Law or any provision of its articles of
incorporation or by-laws; and (ii) does not and will not, with or without the
passage of time or the giving of notice, result in the breach of, or constitute
a

<PAGE>

                                                                              17

default, cause the acceleration of performance, or require any consent under, or
result in the creation of any lien, charge or encumbrance upon any of its
property or assets pursuant to any material instrument or agreement to which it
is a party or by which it or its properties may be bound or affected.

                          ARTICLE 10 - INDEMNIFICATION

     10.1 BY TEVA-TUTEUR. Teva-Tuteur shall indemnify Valera, its affiliates and
their respective directors, officers, shareholders, employees or agents
(collectively, the "VALERA RELEASEES"), and hold it harmless from and against
any and all Losses (including personal injury, death or property damage) arising
from any and all Third Party claims against the Valera Releasees: (a) relating
to the marketing, distribution or sale of the Product in the Territory; (b) of
any nature whatsoever relating to any processing or repackaging of the Product
after delivery to the carrier in accordance with Section 6.5; or (c) caused by a
breach or misstatement by Teva-Tuteur of its representations and warranties
under this Agreement; except, in each case, to the extent such Third Party
claims result from the fault, negligence or willful misconduct of the Valera
Releasees or its or their material failure to comply with the terms of this
Agreement. Teva-Tuteur shall not be liable under this Section 10.1 in the event
that the Valera Releasees admit or settle any such claim without the prior
written consent of Teva-Tuteur, which consent shall not be unreasonably
withheld, conditioned, delayed or denied.

     10.2 BY VALERA. Valera shall indemnify Teva-Tuteur, its Affiliates and
their respective directors, officers, shareholders, employees or agents
(collectively, the "TEVA-TUTEUR RELEASEES"), and hold it harmless from and
against any and all Losses (including personal injury, death or property damage)
arising from any and all Third Party claims against the Teva-Tuteur Releasees:
(a) of any nature whatsoever relating to the manufacture of the Product; or (b)
caused by a breach or misstatement by Valera of its representations and
warranties in Section 9.1; except, in each case, to the extent such Third Party
claims result from the fault or negligence of the Teva-Tuteur Releasees, or its
or their material failure to comply with the terms of this Agreement. Valera
shall not be liable under this Section 10.2 in the event that the Teva-Tuteur
Releasees admit or settle any such claim without the prior written consent of
Valera, which consent shall not be unreasonably withheld, delayed or denied.

     10.3 INDEMNIFICATION PROCEDURE. A Party seeking indemnification (the
"INDEMNIFIED PARTY") shall notify, in writing, the other Party (the
"INDEMNIFYING PARTY") within fifteen (15) Business Days after the assertion of
any claim or discovery of any fact upon which the Indemnified Party intends to
base a claim for indemnification. An Indemnified Party's failure to so notify
the Indemnifying Party shall not, however, relieve such Indemnifying Party from
any liability under this Agreement to the Indemnified Party with respect to such
claim except to the extent that such Indemnifying Party suffers or otherwise
incurs additional liquidated or other readily quantifiable damages as a result
of being denied, during the period of delay in notice, the opportunity to remedy
or otherwise mitigate the event or activity giving rise to the claim for
indemnification or the damages therefrom or is materially prejudiced in the
defense of the claims giving rise to the right to indemnification.

     10.4 DEFENDING CLAIMS. The Indemnifying Party, while reserving the right to
contest its obligations to indemnify the Indemnified Party under this Agreement,
shall be responsible for

<PAGE>

                                                                              18

the defense of any claim, demand, lawsuit or other proceeding in connection with
which the Indemnified Party claims indemnification hereunder. The Indemnified
Party shall have the right, at its expense, to participate jointly with the
Indemnifying Party in the defense of any such claim, demand, lawsuit or other
proceeding, but with respect to any issue involved in such claim, demand,
lawsuit or other proceeding with respect to which the Indemnifying Party has
acknowledged its obligation hereunder, the Indemnifying Party shall have the
right to select counsel, settle, try or otherwise dispose of or handle such
claim, demand, lawsuit or other proceeding on such terms as the Indemnifying
Party shall deem appropriate, subject to any reasonable written objection of the
Indemnified Party.

                   ARTICLE 11 - INTELLECTUAL PROPERTY MATTERS

     11.1 INTELLECTUAL PROPERTY INFRINGEMENT.

          11.1.1. Without limiting the obligations and requirements of Sections
10.2 through 10.4, each Party will notify the other Party if it receives any
notice that the activities engaged in under this Agreement infringe or may
infringe any Third Party's intellectual property rights. If Teva-Tuteur
establishes to Valera's reasonable satisfaction that license(s) under such Third
Party's intellectual property rights is necessary or advisable for purposes of
enabling Teva-Tuteur to market, use or sell the Products in the Territory,
Valera and Teva-Tuteur shall cooperate to obtain such license(s) for the benefit
of Valera and Teva-Tuteur, in accordance with the following provisions:

          11.1.2. Valera shall be primarily responsible for obtaining any such
third party license. The matter shall be deemed resolved if Valera is granted a
license, whether royalty-free or royalty-bearing, under the relevant
intellectual property rights that would make the continued marketing, use or
sale of the Products in the Territory for use in any Indication non-infringing
with respect to such Third Party's intellectual property rights.

          11.1.3. However, in the event that Valera is unable to resolve the
matter in accordance with Section 11.1.2 in spite of good faith efforts and/or
upon terms that are commercially reasonable to Valera, then Teva-Tuteur shall be
entitled to negotiate a license in favor of Teva-Tuteur under such Third Party's
intellectual property rights, provided that Teva-Tuteur shall not enter into
such license without the prior written consent of Valera, such consent not to be
unreasonably withheld or delayed.

          11.1.4. If any claim or suit that the Product infringes any Third
Party's intellectual property rights in the Territory be upheld by a final,
non-appealable order of a court such that Teva-Tuteur is prevented from
marketing, using and selling the Product in the Territory and no license that
permits Teva-Tuteur to market, use and sell the Product in the Territory in
accordance with this Agreement is obtained by either Valera or Teva-Tuteur
pursuant to Sections 11.1.2 and 11.1.3, then Valera may terminate this Agreement
effective upon giving Teva-Tuteur notice of termination without any liability to
Teva-Tuteur.

     11.2 THIRD PARTY INFRINGEMENT.

          11.2.1. In the event that either Party determines that a Third Party
(other than a permitted licensee, transferee or distributor of either Party) is
making, using, or selling a product

<PAGE>

                                                                              19

or process that may infringe any of the intellectual property relating to the
Product, including later issued and acquired patents covering the Product, or
any uses or processes pertaining thereto, it will promptly notify the other
Party in writing.

          11.2.2. Valera shall be responsible for, in its sole discretion,
obtaining a discontinuance of any infringement or bringing suit against a Third
Party infringer relating to the Product. Notwithstanding anything contained
herein to the contrary, Valera shall have the right, but not the obligation, to
bring such a suit. Valera shall bear all the expenses of any such suit brought
by it and shall, after retaining for itself an amount equal to such expenses,
split equally the remaining balance of any and all recovery and damages
therefrom with Teva-Tuteur. Teva-Tuteur agrees to be named as a co-plaintiff if
Valera brings suit and shall cooperate with Valera (which shall include
providing any necessary assistance and executing any necessary documents, with
any reasonable, receipted out-of-pocket expenses being reimbursed to Teva-Tuteur
by Valera to the extent such expenses were previously approved in writing by
Valera), and shall have the right to consult with Valera and to participate in
and be represented by independent counsel in such litigation at its own expense.
Except as otherwise specifically provided herein, Valera shall have control over
any such suit, and decisions as to settlement, methods and/or terms and
conditions for resolving the suit shall be made by Valera (after consultation
with Teva-Tuteur, should Teva-Tuteur be joined as a party to such suit).

                          ARTICLE 12 - CONFIDENTIALITY

     12.1 CONFIDENTIAL INFORMATION. For the purposes of this Agreement,
"CONFIDENTIAL INFORMATION" means all verbal, written, electronically transmitted
and/or machine reproduced information, chemical structures, data, documents,
methods and intellectual property of or relating to the business of either Party
or its Affiliates, already provided or disclosed by it or its Affiliates to the
other Party, or which will be provided to the other Party under this Agreement,
and all materials, data, results, reports and other documents generated by or on
behalf of the other Party containing or regarding such information, data,
documents, methods and Intellectual Property.

     12.2 OBLIGATIONS. During the Term, each Party may supply to the other Party
such Confidential Information as is considered useful solely for the purpose of
enabling the other Party to perform its obligations hereunder (the "PURPOSE").
The other Party shall not use or allow the use of the Confidential Information
for any purpose other than the Purpose or to enforce its rights under this
Agreement.

     12.3 EXCEPTIONS. Neither Party shall have any obligation of non-disclosure
or non-use hereunder with respect to any Confidential Information which:

               (a) at the time of disclosure to the other Party is already
available or known to the public;

               (b) after disclosure to the other Party becomes available or
known to the public through no breach of this Agreement;

<PAGE>

                                                                              20

               (c) is already lawfully in the possession of the other Party at
the time disclosure hereunder was made and such possession is documented by
written evidence and not subject to any obligation of non-disclosure or non-use;
or

               (d) is received from a Third Party having the right to disclose
same and who is not bound by obligations of non-disclosure and/or non-use.

     12.4 COMPELLED DISCLOSURE. If a Party shall become compelled by any
requirement of law or pursuant to any legal, regulatory or investigatory
proceeding before any court, tribunal or other governmental entity, agency or
commission to disclose Confidential Information of the other Party, such Party
shall give the other Party prompt written notice of its receipt of the order or
notice requiring the disclosure so that the other Party may seek a protective
order or other remedy to protect the confidentiality of the Confidential
Information and/or waive the compelled Party's obligations under this Article
12. If such protective order, other remedy or waiver is not obtained or granted
by the time the compelled Party is required to comply, the compelled Party may
furnish only that portion of the Confidential Information of the disclosing
Party that it is compelled to disclose and no more.

     12.5 UNAUTHORIZED USE. In case either Party becomes aware or has knowledge
of any unauthorized use or disclosure of Confidential Information, it shall
promptly notify the other Party of such unauthorized use or disclosure and,
thereafter, shall take all reasonable steps to assist the other Party in
attempting to minimize any potential or actual damages or losses resulting from
such unauthorized use or disclosure.

     12.6 RETURN OF DOCUMENTS. Each Party, upon receipt of a written request
from the other Party following the expiration or termination of this Agreement,
shall promptly return to the other Party all Confidential Information of such
other Party, including all reproductions and copies thereof together with all
internal material and documents generated by it containing Confidential
Information or references thereto or from which references the substance of the
Confidential Information can be implied or understood and shall delete all
references thereto stored electronically.

     12.7 OWNERSHIP RIGHTS. Each Party agrees that it shall not claim to have
any rights, title or ownership in the Confidential Information of the other
Party or any discoveries or inventions based on or derived from the Confidential
Information, and that rights, title and ownership in the Confidential
Information or any discoveries or inventions based on or derived from said
Confidential Information shall, as between the Parties, rest in the disclosing
Party. Each party agrees to promptly disclose to the disclosing Party any
discoveries or inventions based on or derived from the Confidential Information.
Each Party further agrees to assign (and does hereby assign) to the disclosing
Party, the sole and exclusive ownership in all such discoveries and inventions
and to sign all documents and do all things required to give effect thereto.

     12.8 TERM. The provisions of this Article 12 shall survive the expiration
or termination of the Agreement until all of the Confidential Information has
fallen within one of the exceptions set forth in Sections 12.3.

<PAGE>

                                                                              21

                        ARTICLE 13 - TERM AND TERMINATION

     13.1 TERM. This Agreement shall commence upon the Effective Date and shall
continue for ten (10) years after the date on which the first Regulatory
Approval that allows sales to proceed in the Territory is issued unless sooner
terminated as provided elsewhere in this Agreement. This Agreement shall
automatically renew for additional periods of one (1) year each unless a Party
gives notice to the other Party at least six (6) months prior to the completion
of the then-current term.

     13.2 TERMINATION. This Agreement may be terminated:

               (a) By a Party if the other Party commits a Material Breach and
(i) fails to remedy the breach within thirty (30) Business Days of being
required by the first Party to do so; or (ii) where remedy of the breach is not
reasonably possible within thirty (30) Business Days, fails to propose a plan
within twenty (20) Business Days which, in the opinion of the first Party acting
reasonably, is capable of providing a remedy of the breach within ninety (90)
Business Days.

               (b) If either Party shall commence as debtor any proceedings
under any bankruptcy, insolvency, readjustment of debt, dissolution or
liquidation Law or any such proceeding shall be commenced against either Party,
or any trustee or receiver shall be appointed therefor, and either Party shall
by any act or failure to act indicate approval of or consent to, or acquiescence
in such proceedings or in the appointment of any such trustee or receiver; or if
any such proceedings brought against either Party shall be approved by any court
and shall remain undismissed for thirty (30) Business Days after its levy, then
in any such case, the Party not involved in such proceedings shall have the
option to terminate this Agreement in its entirety by written notice of such
termination to the Party involved in such proceedings and upon the giving of
such notice this Agreement shall immediately terminate.

               (c) By either Party, upon at least thirty (30) days prior written
notice to the other Party, if, as a result of an Event of Force Majeure, the
other Party is unable to fully perform its obligations hereunder for a period of
one hundred fifty (150) consecutive days; provided that if the required
performance is met during the thirty (30) day period, this Agreement shall
continue in full force and effect as if the notice had not been given.

               (d) By a Party, on a Indication-by-Indication basis, if the
Regulatory Authority has finally denied Regulatory Approval (or any material
part thereof) for the Product with respect to such Indication.

               (e) By Valera, on an Indication-by-Indication basis, if
Teva-Tuteur fails to file all Marketing Approval Applications necessary to allow
the marketing and sale of the Product in the Territory for use in the given
Indication within thirty (30) days after the deadline stated in the Plan for the
filing of all such Marketing Approval Applications for such Indication.

               (f) By Valera pursuant to Section 6.4.2.

     13.3 PARTIAL TERMINATION. In the event that any termination of this
Agreement is limited to one (1) or more, but not all forms or dosages of the
Product, or to an Indication, then

<PAGE>

                                                                              22

the effects of such termination shall only apply to the affected form(s),
dosage(s) or Indication(s), but shall not affect in any way the validity of this
Agreement with respect to any other form, dosage or Indication.

     13.4 REMEDIES NOT LIMITED. The termination of this Agreement by either
Party shall not limit remedies that may be otherwise available.

     13.5 SURVIVAL. Expiration or termination of this Agreement for any reason
shall not relieve either party for any breach of this Agreement occurring prior
to the expiration or termination of this Agreement. Article 1, Article 7,
Article 8, Article 10, Article 12 and Article 15 and Sections 3.3, 3.5, 4.5,
4.6, 4.7, 11.1, 13.4, 13.5, 13.6 and 13.7 shall survive expiration or
termination of this Agreement for any reason in accordance with their respective
terms.

     13.6 POST-TERMINATION. Unless Valera terminates this Agreement pursuant to
Sections 13.2(a) or 13.2(b), during the six (6) month period following the
expiration or termination of this Agreement, Teva-Tuteur may sell out its stock
on hand of the Product. All applicable provisions of this Agreement shall
survive termination as necessary to give effect to this Section 13.6.

     13.7 OTHER CONSEQUENCES OF TERMINATION. Upon termination or expiration of
this Agreement (whether in whole or in part), Teva-Tuteur shall within thirty
(30) days from the date of receipt of a request from Valera submit all necessary
paperwork to all Regulatory Authorities to request assignment to Valera or its
designee of all Marketing Approval Applications and all related registrations
and product numbers for the Product and any other Regulatory Approval held with
respect to the Product (in each case whether in Teva-Tuteur's name or the name
of any Affiliate of Teva-Tuteur); provided that if this Agreement is only
terminated as to an Indication, then only the assignment of all Marketing
Approval Applications and all related registrations and product numbers for the
Product and any other Regulatory Approval held with respect to the Product (in
each case whether in Teva-Tuteur's name or the name of any Affiliate of
Teva-Tuteur) for such Indication shall be required.

                           ARTICLE 14 - FORCE MAJEURE

     14.1 DEFINITION. For the purposes of this Agreement, an "EVENT OF FORCE
MAJEURE" means any one or more of the following:

               (a) acts of God;

               (b) expropriation, confiscation or requisitioning of facilities,
compliance with any Law not presently existing, or change in the interpretation
of any presently existing Law which affects to a degree not presently existing
the supply, availability, export or use of the Product, materials or labour;

               (c) acts or inaction on the part of any Governmental Body or
Person purporting to act therefor;

               (d) embargoes, or acts of war or the public enemy, whether war be
declared or not;

<PAGE>

                                                                              23

               (e) strikes, public disorder, insurrection, rebellion, riots or
violent demonstrations;

               (f) floods, earthquakes, lightning, hail, inclement weather
conditions or other natural calamities; and

               (g) any circumstances whether or not of the class or kind
specifically named above not within the reasonable control of a Party and which,
despite the exercise of reasonable diligence, such Party is unable to prevent,
avoid or remove including demand that exceeds Valera's supply of the Product.

     14.2 PROCEDURE. If any Party wishes to invoke an Event of Force Majeure,
then it shall (i) promptly following the commencement of such Event of Force
Majeure notify the other Parties of the occurrence of such Event of Force
Majeure, the reasonably estimated date and time on which it commenced and the
nature of the Event of Force Majeure, and (ii) as soon as reasonably practicable
thereafter, submit to the other Parties proof of the Event of Force Majeure.

     14.3 SUSPENSION OF OBLIGATIONS. If one of the Parties is unable to perform
its obligations under this Agreement because of an Event of Force Majeure, then
such Party shall be excused from performance of its obligations under this
Agreement until the Event of Force Majeure terminates and the obligations of
such Party, which cannot be met due to the Event of Force Majeure, shall be
suspended during the pendency of the Event of Force Majeure; provided that such
Party uses all reasonable efforts to attempt to prevent, avoid or remove the
Event of Force Majeure within the shortest possible delay. Nevertheless, an
Event of Force Majeure has no effect on the obligation to pay a sum of money
owing for the purchase of the Product.

     14.4 RESOLUTION. If either Party is excused from performance under this
Agreement because of an Event of Force Majeure, then the Parties agree to
promptly meet and to work in good faith together in an attempt to find
appropriate solutions and to shorten the duration of the Event of Force Majeure,
to the extent reasonably feasible.

                           ARTICLE 15 - MISCELLANEOUS

     15.1 LIMITATIONS OF LIABILITY. EXCEPT IN RESPECT OF VALERA'S
INDEMNIFICATION OBLIGATIONS UNDER THIS AGREEMENT, IN NO EVENT SHALL VALERA'S
LIABILITY TO TEVA-TUTEUR FOR DAMAGES UNDER OR IN RESPECT OF THIS AGREEMENT
EXCEED, IN THE AGGREGATE, THE TOTAL AMOUNT PAID TO VALERA UNDER THIS AGREEMENT
DURING THE TWELVE (12) MONTHS PRECEDING THE EVENT GIVING RISE TO THE DAMAGE,
WHETHER SUCH DAMAGES ARISE IN TORT, CONTRACT OR OTHERWISE. IN ADDITION, IN NO
EVENT SHALL VALERA BE LIABLE FOR ANY SPECIAL, INCIDENTAL, CONSEQUENTIAL OR
INDIRECT DAMAGES, HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY. THIS LIMITATION
WILL APPLY EVEN IF VALERA HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

<PAGE>

                                                                              24

     15.2 NOTICES. Any notice or other communication required or permitted to be
given hereunder shall be in writing and shall be delivered in person,
transmitted by facsimile or sent by internationally-recognized overnight courier
mail, charges prepaid, addressed as follows:

          If to Valera:      Valera Pharmaceuticals, Inc.
                             7 Clarke Drive
                             Cranbury, New Jersey 08512-3617
                             USA
                             Attention: President
                             Fax: 1-609-235-3200

          If to Teva-Tuteur: Teva-Tuteur
                             Encarnacion Ezcurra 365. 3rd floor
                             1107 Buenos Aires
                             Argentina
                             Fax: 54 11 57872027

Any such notice or other communication shall be deemed to have been given and
received on the day on which it was delivered or successfully transmitted (or,
if such day is not a Business Day, on the next following Business Day) or, if
sent by nationally-recognized overnight courier, on the date on which it was
received or first-attempted delivery. Either Party may change its address for
service from time to time by giving notice thereof to the other Party in
accordance with this Section 15.2.

     15.3 INDEPENDENT CONTRACTORS; NO AGENCY OR REPRESENTATION. Teva-Tuteur
shall buy and sell in its own name and for its own account and shall act as an
independent trader with regard to both Valera and the end customers. Nothing in
this Agreement shall authorize Teva-Tuteur to engage in transactions in the name
of Valera or in any activities which may create any obligations of or
liabilities to Valera. Teva-Tuteur acknowledges that, except as set forth in
Section 2.1, Valera does not grant its representation to Teva-Tuteur. There
shall be no legal, labor or civil relationship whatsoever between Valera and
Teva-Tuteur's employees or any other person hired at the expense Teva-Tuteur in
relation with this Agreement. Consequently, Teva-Tuteur hereby assumes complete
responsibility for the payment of all salaries, employment benefits,
indemnifications, personal fees and other legally appropriate obligations shall
be complied with at Teva-Tuteur's own expense. In case a claim or litigation is
raised against Valera because of such obligations, Teva-Tuteur shall indemnify,
defend and hold harmless Valera against any amount that may be claimed.

     15.4 SEVERABILITY. If any term of this Agreement is held by a court of
competent jurisdiction to be invalid or unenforceable, then such term shall be
reformed or deleted, but only to the extent necessary to comply with such
holding, and the remaining provisions of this Agreement shall remain in full
force and effect.

     15.5 AMENDMENTS; WAIVER. No amendment or waiver shall be binding on either
Party unless consented to in writing by such Party. No waiver of any provision
of this Agreement shall constitute a waiver of any other provision, nor shall
any waiver constitute a continuing waiver unless otherwise expressly provided.

<PAGE>

                                                                              25

     15.6 EXCLUSIVE JURISDICTION. The court with jurisdiction over the
then-current headquarters of Valera shall have exclusive jurisdiction over any
dispute, controversy or claim arising out of or relating to this Agreement
including any question regarding its existence, interpretation, validity, breach
or termination. Notwithstanding the foregoing, a party may seek injunctive and
other equitable relief in any court of competent jurisdiction. The prevailing
party's reasonable attorneys' and accountants' fees, expenses and disbursements)
shall be borne by the party against whom judgment is rendered.

     15.7 ASSIGNMENT. The rights and obligations under this Agreement may not be
assigned by Teva-Tuteur (except to an Affiliate) without the prior written
consent of Valera, which consent shall not be unreasonably withheld or delayed.
Valera may assign this Agreement in its sole discretion. This Agreement shall
inure to the benefit of and be binding upon Valera an Teva-Tuteur and their
respective successors and permitted assigns.

     15.8 FURTHER ASSURANCES. Each Party will, from time to time subsequent to
the date hereof, at the request and expense of any other Party, execute and
deliver all such documents and do all such other acts and things as that other
Party, acting reasonably, may from time to time request be executed or done in
order to better evidence or perfect or effectuate any provision of this
Agreement or any of the respective obligations intended to be created hereby or
thereby.

     15.9 PUBLICITY. Neither Party shall issue any press release or other public
announcement relating to existence or terms of this Agreement without the prior
written consent of the other Party (which consent shall not be unreasonably
withheld or delayed), except where such announcements are required by law or
regulation, in which event the Parties will use all reasonable efforts to
consult with each other and cooperate with respect to the wording of any such
announcement. The Parties shall cooperate in issuing an initial public release
with respect to the signing of this Agreement, either separately or as a joint
release.

     15.10 COUNTERPARTS. This Agreement may be executed in counterparts, each of
which shall constitute an original and all of which taken together shall
constitute one and the same instrument in effect as of the date first above
mentioned.

     15.11 GOVERNING LAW. This Agreement shall be governed by and interpreted in
accordance with the Laws in effect in the State of New Jersey, U.S.A. applicable
to contracts entered into by residents of New Jersey and wholly performed within
New Jersey.

     15.12 LANGUAGE. The Parties confirm that it is their wish that this
Agreement as well as all other documents relating to this Agreement, including
notices, have been and shall be drawn up in the English language only.

     15.13 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the Parties with respect to the subject matter of this Agreement and
supersedes all prior and contemporaneous agreements, understandings, letters of
intent, negotiations and discussions, whether written or oral. There are no
conditions, covenants, agreements, representations, warranties or other
provisions, express or implied, collateral, statutory or otherwise, relating to
the subject matter of this Agreement, except as provided in this Agreement.
Teva-Tuteur

<PAGE>

                                                                              26

acknowledges that it has no right or interest, such as "most favored nations"
interest or rights, in any transaction or agreement between Valera and any other
Person.

                            (SIGNATURE PAGE FOLLOWS)

<PAGE>

     IN WITNESS WHEREOF, this Agreement has been executed by the Parties on the
date first set forth above.

VALERA PHARMACEUTICALS, INC.

By: /S/ David S. Tierney                Date:
    ---------------------------------         -----------------------
    David S. Tierney, CEO

TEVA-TUTEUR

By: /S/ Edgardo Taraciuk                Date:
    ---------------------------------         -----------------------
Name:   Edgardo Taraciuk
      -------------------------------
Title:  Director
       ------------------------------<PAGE>
                                                                   EXHIBIT 10.23

  AMENDMENT NO. 1, WAIVER AND CONSENT TO AMENDED AND RESTATED CREDIT AGREEMENT

                  This AMENDMENT NO. 1, WAIVER AND CONSENT dated as of October
__, 2005 (this "Amendment No. 1"), among HLI OPERATING COMPANY, INC., a Delaware
corporation (the "Borrower"), HAYES LEMMERZ INTERNATIONAL, INC., a Delaware
corporation ("Holdings"), and CITICORP NORTH AMERICA, INC. ("CNAI"), as
Administrative Agent on behalf of each Lender executing a Lender Consent (as
defined below) amends certain provisions of the Amended and Restated Credit
Agreement, dated as of April 11, 2005 (as the same may be amended, restated,
supplemented or otherwise modified from time to time, the "Credit Agreement"),
among the Borrower, Holdings, the Lenders and Issuers (in each case as defined
therein) party thereto, CNAI, as Agent for the First Lien Lenders (as defined
therein), CNAI, as Agent for the Term C Lenders (as defined therein), CNAI, as
Collateral Agent for the Secured Parties, LEHMAN COMMERCIAL PAPER INC., as
Syndication Agent, GENERAL ELECTRIC CAPITAL CORPORATION, as Documentation Agent,
and CITIGROUP GLOBAL MARKETS INC. and LEHMAN BROTHERS INC., as Joint
Book-Running Lead Managers and Joint Lead Arrangers.

                                   WITNESSETH:

                  WHEREAS, the Borrower has requested that the Lenders agree to
amend certain provisions of the Credit Agreement;

                  WHEREAS, the Borrower and the Administrative Agent wish to
enter into this Amendment for the purpose of giving effect to such modifications
in each case as more particularly set forth herein;

                  WHEREAS, the Borrower desires that certain of its Subsidiaries
enter into the transactions described on Annex A hereto (collectively, the
"Specified Transactions") and has requested that the Administrative Agent and
the Requisite Lenders consent to the Specified Transactions;

                  WHEREAS, pursuant to Section 11.1(a) (Amendments, Waivers,
Etc.) of the Credit Agreement, the consent of the Requisite Lenders is required
to effect the amendments set forth herein;

                  WHEREAS, the Lenders party to the Lenders' Consent
(constituting the Requisite Lenders) and the Administrative Agent agree, subject
to the limitations and conditions set forth herein, to (a) consent to the
Specified Transactions and (b) amend the Credit Agreement as set forth herein;

                  NOW, THEREFORE, in consideration of the above premises, the
Borrower and the Administrative Agent, at the direction of the Lenders
constituting the Requisite Lenders, agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

                  Section 1.1 Unless otherwise defined herein, capitalized terms
used herein shall have the meanings ascribed to such terms in the Credit
Agreement.

<PAGE>

                                   ARTICLE II
                               CONSENT AND WAIVER

                  Section 2.1 Effective as of the Amendment Effective Date and
subject the satisfaction (or due waiver) of the conditions set forth in Article
VI (Conditions Precedent to the Effectiveness of this Amendment No. 1) hereof,
the Lenders party to the Lenders' Consent, constituting the Requisite Lenders,
and the Administrative Agent hereby consent to the Specified Transactions
described on Annex A and agree that the Specified Transactions shall not
constitute "Investments" or "Asset Sales" for purposes of the limitations in
Sections 8.3 (Investments) and 8.4 (Sale of Assets) of the Credit Agreement.

                                  ARTICLE III
                             AMENDMENT TO ARTICLE II
                                 (DEFINED TERMS)

                  Section 3.1 New Definitions. The following defined terms shall
be inserted in the correct alphabetical order in Section 1.1 (Defined Terms):

                           "Foreign Receivables Purchase Program" means, with
                  respect to any Foreign Subsidiary, an agreement or other
                  arrangement or program providing for the sale on a
                  non-recourse basis (other than Guaranty Obligations permitted
                  under Section 8.1(c)(ii) (Indebtedness)) of Receivables Assets
                  in exchange for the advance of funds to such Foreign
                  Subsidiary and/or one or more of its Subsidiaries pursuant to
                  documentation (including customary performance guaranties)
                  reasonably acceptable to the First Lien Agent (including,
                  without limitation, an intercreditor agreement); provided,
                  however, that, with respect to the German Foreign Receivables
                  Purchase Program, recourse by MHB Financial Services GmbH &
                  Co. KG, Eschborn to Hayes Lemmerz Werke GmbH shall be
                  permitted in an aggregate amount not to exceed 5% of the
                  amount of Receivables Assets sold pursuant to the German
                  Foreign Receivables Purchase Program.

                           "German Foreign Receivables Purchase Program" means
                  the revolving Foreign Receivables Purchase Program in an
                  amount not to exceed SUM20,000,000 at any one time, pursuant
                  to which Hayes Lemmerz Werke GmbH shall sell and assign
                  certain Receivables Assets to MHB Financial Services GmbH &
                  Co. KG, Eschborn.

                  Section 3.2 The following defined terms listed in Section 1.1
(Defined Terms) of the Credit Agreement are amended as follows:

                           Indebtedness. The definition of "Indebtedness" shall
                  be amended by (a) inserting the words "or a Foreign
                  Receivables Purchase Program" at the end of the parentheticals
                  in the second and fourth lines thereof and (b) inserting the
                  words "or Foreign Receivables Purchase Program" after the
                  words "conveyed in accordance with any Securitization Program"
                  in the twenty-fourth line thereof.

                                       2
<PAGE>

                                   ARTICLE IV
                            AMENDMENT TO ARTICLE VIII
                              (NEGATIVE COVENANTS)

                  Section 4.1 Indebtedness.

                  (a)      Section 8.1 (Indebtedness) of the Credit Agreement
shall be amended by replacing clause (c) thereof in its entirety as follows:

                           "(c) Guaranty Obligations incurred by the Borrower,
                  any Guarantor or any Foreign Subsidiary in respect of (i) with
                  respect to the Borrower or any Guarantor, Indebtedness of the
                  Borrower or any Guarantor that is permitted by this Section
                  8.1 and (ii) with respect to any Foreign Subsidiary,
                  Indebtedness permitted by Section 8.1(o)(i)(B) to the extent
                  that the applicable Administrative Agent has consented (in its
                  sole discretion, exercised reasonably) to such incurrence;
                  provided, however, that the aggregate outstanding amount of
                  all such Guaranty Obligations incurred by the Foreign
                  Subsidiaries, with respect to Foreign Receivables Purchase
                  Programs, shall not exceed $10,000,000; and, provided,
                  further, that the Guaranty Obligations permitted under clause
                  (ii) above may not be in respect of Indebtedness owed to the
                  Administrative Agent or any of its Affiliates."

                  (b)      Section 8.1 (Indebtedness) of the Credit Agreement
shall be amended by replacing clause (o) thereof in its entirety as follows:

                           "Indebtedness (i) arising under any Securitization
                  Program or Foreign Receivables Purchase Program; provided,
                  however, that (A) the aggregate outstanding amount of all such
                  Indebtedness (not including any amount described in clause
                  (iii) of this Section 8.1(o)) shall not exceed $100,000,000
                  (regardless of the amount of accounts receivable sold,
                  securitized or collateralized thereunder) and (B) with respect
                  to any Foreign Receivables Purchase Program, the aggregate
                  amount of all such Indebtedness shall not exceed $50,000,000
                  (regardless of the amount of accounts receivable sold or
                  collateralized thereunder), (ii) arising from intercompany
                  loans from the Borrower or any of its Subsidiaries that sells
                  Receivables Assets to a Securitization SPV and (iii)
                  consisting of renewals, extensions, refinancings, replacements
                  and refundings of Indebtedness permitted by this Section
                  8.1(o); provided, however, that any such renewal, extension,
                  refinancing, replacement or refunding is on market terms and
                  is in an aggregate outstanding principal amount not to exceed
                  the amount set forth in the preceding clause (i) of this
                  Section 8.1(o); or"

                  Section 4.2 Liens, Etc,

                  Section 8.2 (Liens, Etc.) of the Credit Agreement shall be
amended by replacing clause (j) thereof in its entirety as follows:

                           "(j) Liens arising pursuant to, or assignments in
                  connection with, any Securitization Program or Foreign
                  Receivables Purchase Program solely with respect to
                  Receivables Assets securitized or sold, as the case may be,
                  thereunder."

                                       3
<PAGE>

                  Section 4.3 Sale of Assets

                  Section 8.4 (Sale of Assets) of the Credit Agreement shall be
amended by inserting the words "or Foreign Receivables Purchase Program" after
the words "pursuant to a Securitization Program" in the second line of clause
(j) thereof.

                  Section 4.4 Prepayment and Cancellation of Indebtedness

                  (a) Section 8.6 (Prepayment and Cancellation of Indebtedness)
of the Credit Agreement shall be amended by inserting the words "or a Foreign
Receivables Purchase Program" after the words "Indebtedness incurred pursuant to
a Securitization Program" in the sixteenth and nineteenth lines of clause (b)
thereof.

                  (b) Section 8.6 (Prepayment and Cancellation of Indebtedness)
of the Credit Agreement shall be amended by inserting the words "or Foreign
Receivables Purchase Program" after the words "any Securitization Program" in
the second line of clause (c) thereof.

                  Section 4.5 Limitations on Restrictions on Subsidiary
Distributions; No New Negative Pledges.

                  Section 8.10 (Limitations on Restrictions on Subsidiary
Distributions; No New Negative Pledges) of the Credit Agreement shall be amended
by inserting the words "or Foreign Receivables Purchase Program" after the words
"in connection with a permitted Securitization Program" in the second line
thereof.

                                   ARTICLE V
                             AMENDMENT TO ARTICLE IX
                               (EVENTS OF DEFAULT)

                  Section 5.1 Events of Default.

                  Section 9.1 (Events of Default) of the Credit Agreement shall
be amended by inserting the words "or Foreign Receivables Purchase Program"
after the words "in connection with any Securitization Program" in the second
line of clause (n) thereof.

                                   ARTICLE VI
                    CONDITIONS PRECEDENT TO THE EFFECTIVENESS
                            OF THIS AMENDMENT NO. 1.

                  Section 6.1 Effectiveness. This Amendment No. 1 shall become
effective, on the date each of the following conditions precedent is satisfied
or duly waived by the Requisite Lenders (the "Amendment Effective Date"):

                  (a)      Documentation. The Administrative Agent shall have
received on or prior to the Amendment Effective Date each of the following, each
dated the Amendment Effective Date unless otherwise indicated or agreed to by
the Administrative Agent, in form and substance satisfactory to the
Administrative Agent:

                           (i) this Amendment No. 1 executed by the Borrower and
        Holdings;

                                       4
<PAGE>

                           (ii) the Consent and Agreement in the form attached
        hereto as Exhibit A, executed by each of the Guarantors;

                           (iii) Acknowledgment and Consents, in the form set
         forth hereto as Exhibit B (each, a "Lender Consent"), executed by the
         Lenders constituting the Requisite Lenders; and

                           (iv) such additional documentation as the
        Administrative Agent may reasonably require.

                  (b)      Fees and Expenses. The Borrower shall have paid:

                           (i) unless otherwise agreed by the Administrative
         Agent, all outstanding fees, costs and expenses owing to the
         Administrative Agent, including the reasonable fees, expenses and
         disbursements of all legal counsel for the Administrative Agent; and

                           (ii) the legal fees set forth on Annex B hereto.

                                  ARTICLE VII
                                  MISCELLANEOUS

                  Section 7.1 Subsidiary Guarantors. The Borrower hereby
represents and warrants to the Administrative Agent and the Lenders that as of
the date hereof the Consent and Agreement in the form attached hereto as Exhibit
A sets forth the true and correct name of each Subsidiary Guarantor.

                  Section 7.2 Reference to and Effect on the Loan Documents.

                  (a)      On and after the Amendment Effective Date, each
reference in the Credit Agreement to "this Agreement," "hereunder," "hereof,"
"herein," or words of like import, and each reference in the other Loan
Documents to the Credit Agreement, shall mean and be a reference to the Credit
Agreement as amended hereby, and this Amendment No. 1 and the Credit Agreement
shall be read together and construed as a single instrument. The table of
contents, signature pages and list of Exhibits and Schedules of the Credit
Agreement shall be modified as necessary to reflect the changes made in this
Amendment No. 1 as of the Amendment Effective Date.

                  (b)      Except as specifically amended or waived above, all
of the terms of the Credit Agreement and all other Loan Documents shall remain
unchanged and in full force and effect and all obligations and liabilities of
the Loan Parties thereunder shall remain in full force and effect and each of
which is hereby reaffirmed.

                  (c)      The execution, delivery and effectiveness of this
Amendment No. 1 shall not, except as expressly provided herein, operate as an
amendment or waiver of any right, power or remedy of any Lender, any Issuer, or
the Administrative Agent under the Credit Agreement or any Loan Document nor
constitute an amendment or waiver of any provision of the Credit Agreement or
any Loan Document.

                  (d)      This Amendment No. 1 is a Loan Document.

                  Section 7.3 Costs and Expenses. The Borrower agrees to pay on
demand in accordance with the terms of Section 11.3 (Costs and Expenses) of the
Credit Agreement all costs and expenses of the Administrative Agent in
connection with the preparation, reproduction, execution and

                                       5
<PAGE>

delivery of this Amendment No. 1, and all other Loan Documents entered into in
connection herewith, including the reasonable fees, expenses and disbursements
of Weil, Gotshal & Manges LLP and other counsel for the Administrative Agent
with respect thereto.

                  Section 7.4 Titles. The Section titles contained in this
Amendment No. 1 are and shall be without substantive meaning or content of any
kind whatsoever and are not a part of the agreement between the parties hereto.

                  Section 7.5 Execution in Counterparts. This Amendment No. 1
may be executed and delivered in any number of counterparts and by different
parties hereto in separate counterparts, each of which when so executed and
delivered shall be deemed an original and all of which taken together shall
constitute one and the same original agreement.

                  Section 7.6 Notices. All communications and notices to the
Administrative Agent hereunder shall be given as provided in the Credit
Agreement.

                  Section 7.7 Severability. If any term or provision set forth
in this Amendment No. 1 shall be invalid or unenforceable, the remainder of this
Amendment No. 1, or the application of such terms or provisions to persons or
circumstances, other than those to which it is held unenforceable, shall not in
any way be affected or impaired thereby.

                  Section 7.8 Successors. The terms of this Amendment No. 1
shall be binding upon, and shall inure to the benefit of, the parties hereto and
their respective successors or assigns.

                  Section 7.9 Governing Law. This Amendment No. 1 shall be
interpreted, and the rights and liabilities of the parties determined, in
accordance with the internal law of the State of New York.

                            [SIGNATURE PAGES FOLLOW]

                                       6

<PAGE>

         IN WITNESS WHEREOF, this Amendment No. 1 has been duly executed on the
date set forth above.

                           HLI Operating Company Inc.,
                           as Borrower

                           By: /s/ Gary Findling
                               --------------------------------------------
                               Name: Gary Findling
                               Title: Treasurer

                           Hayes Lemmerz International, Inc.,
                           as Holdings

                           By: /s/ Gary Findling
                               --------------------------------------------
                               Name: Gary Findling
                               Title: Treasurer

                           CITICORP NORTH AMERICA INC.,
                           as Administrative Agent

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

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