Document:

Separation Agreement, effective as of September 6, 2005

 Exhibit 10.1 
  
 CONFIDENTIAL: FOR SETTLEMENT PURPOSES ONLY 
  

August 1, 2005 
  
 Mr. Derek Stein 
 [Address] 
 [Address] 
  
 Re: Separation from Employment

  
 Dear Mr. Stein: 
  
 This letter agreement (the “Agreement and Release”) between you and Knight Equity Markets, L.P., a Delaware limited liability
company, having its principal place of business at 545 Washington Boulevard, Jersey City, New Jersey 07310 (hereinafter referred to as “Knight” or the “Company”), confirms our understanding and agreement with respect to your
termination of employment with the Company as follows: 
  
 1. Termination.
You have been permitted to resign effective August 1, 2005 (hereinafter, the “Separation Date”). 
  
 2. Compensation. Regardless of whether you sign this Agreement and Release, your total and final compensation, payments and benefits from the Company shall be as follows (subject to applicable deductions and
withholdings): 
  
 a. You have received your salary at the
current rate of your base compensation through August 1, 2005, payable in accordance with the Company’s payroll practices. 
  
 b. Your group medical and dental insurance benefits will remain in effect through August 31, 2005. Thereafter, you will be eligible to participate in
COBRA for medical and dental insurance for a period of up to 18 months. You will be provided with all documentation necessary in order to apply for such continued COBRA coverage. You will be responsible for all COBRA premium payments, except as
provided in paragraph 3(b) herein. 
  
 c. As of the Separation
Date, you will cease to actively participate in all other benefit plans and programs, including, but not limited to, the Company’s 401k plan and any entitlements thereunder including but not limited to payment of any voluntary deferred
compensation under the Company’s plan with Deephaven Capital Management LLC will be governed by the terms of such plans and programs. You agree that any amounts payable under this Paragraph 2 will not be taken into account in determining any
such entitlements; 
  
 d. You have been paid your accrued and
unused vacation time in a lump sum. 
  
 e. You will be
reimbursed for approved and authorized out-of-pocket travel and business expenses incurred through your Separation Date, as soon as practicable thereafter. 

 Mr. Derek Stein 
 August 1,
2005 
 Page 2 
  
 3. Consideration. You will be entitled to the following payments and benefits (subject to applicable deductions and withholdings), contingent upon your execution and delivery of this Agreement and Release in
accordance with the provisions of Paragraph 21 below: 
  
 a. If
this Agreement and Release becomes effective, then the Company will pay you severance in the amount of $1,310,705. 
  
 b. You will be reimbursed by the Company for your premium payment for the first 12 months of your family’s coverage under COBRA, and, thereafter,
continued coverage will be at your expense. No reimbursements will be made for any period of coverage after you and your family are eligible to participate in a medical plan with a new employer. You are required under this Agreement and Release to
notify the Company, if and when you become eligible for coverage with a new employer. Reimbursement by the Company of up to the first 12 months of your family’s coverage under COBRA is contingent upon your initial and continuing eligibility for
such coverage (and associated costs) as determined by, and subject to your present eligibility for such coverage. 
  
 c. You will be eligible for standard executive outplacement services to be provided by Harris McCully Associates. These services must be utilized within
six months from the Termination Date. 
  
 d. If this Agreement and
Release becomes effective, the Company will reimburse you for attorneys fees incurred up to a maximum of $15,000. 
  
 4. Other Compensation. You understand and agree that the compensation, payments and benefits provided for in paragraph 3 of this Agreement and Release are in
excess of those to which you may be entitled from the Company or the Releasees, as defined in Paragraph 5 (d) below, and you expressly acknowledge and agree that you are not entitled to any additional compensation, payment or benefit from the
Company or the Releasees, including, but not limited to, any compensation, payment or benefit under any Company severance plan or policy. 
  

	5.	Waiver and Release By You. In exchange for the compensation, payments, benefits and other consideration provided to you pursuant to this Agreement and Release, you agree as
follows: 

  
 a. To the fullest extent permitted by
law you hereby IRREVOCABLY AND UNCONDITIONALLY RELEASE, WAIVE AND FOREVER DISCHARGE the Company and the Releasees from any and all legally waiveable agreements, promises, liabilities, claims, demands, rights and entitlements of any kind whatsoever,
in law or equity, whether known or unknown, asserted or unasserted, fixed or contingent, apparent or concealed, which you, your heirs, executors, administrators, successors or assigns ever had, now have or hereafter can, shall or may have for, upon,
or by reason of any matter, cause or thing whatsoever existing, arising or occurring at any time on or prior to the date you execute this Agreement and Release, including, without limitation, any and all claims arising out of or relating to your
employment, 

 Mr. Derek Stein 
 August 1,
2005 
 Page 3 
  
 compensation and benefits with the Company and/or the termination thereof, and any and all contract claims, benefit claims, tort claims, fraud claims, claims under any employment agreement (and any predecessor
agreement), commissions, defamation, disparagement, or other personal injury claims, claims related to any bonus compensation, claims for accrued vacation pay, claims under any federal, state or municipal wage payment, discrimination or fair
employment practices law, statute or regulation, and claims for costs, expenses and attorneys’ fees with respect thereto, except that the Company’s obligations under this Agreement and Release shall continue in full force and effect in
accordance with its terms. THIS RELEASE AND WAIVER INCLUDES, WITHOUT LIMITATION, ANY AND ALL RIGHTS AND CLAIMS UNDER TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, THE AGE DISCRIMIATION IN EMPLOYMENT ACT, AS AMENDED, THE CIVIL RIGHTS ACT OF 1991, THE
CIVIL RIGHTS ACT OF 1866 (42 U.S.C. 1981), THE EMPLOYEE RETIREMENT INCOME SECURITY ACT, AS AMENDED, THE AMERICANS WITH DISABILITIES ACT, THE NEW JERSEY LAW AGAINST DISCRIMINATION, THE NEW JERSEY WAGE PAYMENT ACT, THE NEW JERSEY FAMILY LEAVE ACT, THE
NEW JERSEY CONSCIENTIOUS EMPLOYEE PROTECTION ACT; and all other federal, state or local fair employment practices statutes, ordinances, regulations or constitutional provisions; provided, however, that this waiver and release shall
not prohibit you from enforcing your rights under this Agreement and Release. 
  
 b. To the fullest extent permitted by law, you represent and affirm that: (i) you have not filed or caused to be filed on your behalf any claim for relief against the Company before any arbitral, administrative,
regulatory, self-regulatory, judicial, legislative, or other body or agency, and, to the best of your knowledge and belief, no outstanding claims for relief have been filed or asserted against the Company on your behalf, whether in your name or on
your behalf as part of a class, collective or representative action; and (ii) you have no knowledge of any purported improper, unethical or illegal conduct or activities. 
  
 c. For the purpose of implementing a full and complete release and discharge of claims, you expressly acknowledge that this
Agreement and Release is intended to include in its effect, without limitation, all the claims described in the preceding Paragraph 5(a), whether known or unknown, apparent or concealed, and that this Agreement and Release contemplates the
extinction of all such claims, including claims for attorney’s fees. You expressly waive any right to assert after the execution of this Agreement and Release that any such claim, demand, obligation or cause of action has, through ignorance or
oversight, been omitted from the scope of this Agreement and Release; and 
  
 d. For purposes of this Agreement and Release, the terms “the Company and the Releasees” and “the Company or the Releasees”, include Knight Equity Markets, L.P., and any past, present and future
direct and indirect parents, subsidiaries, affiliates, divisions, predecessors, successors, and assigns, and their and Knight’s past, present and future officers, directors, shareholders, representatives, employees, agents and attorneys, in
their official and individual capacities, and all other related individuals and entities, jointly and individually, and this Agreement and Release shall inure to the benefit of and be enforceable by all such entities and individuals and their
successors and assigns. 

 Mr. Derek Stein 
 August 1,
2005 
 Page 4 
  
 6. No Admissions. Nothing contained in this Agreement and Release shall be deemed to constitute an admission or evidence of any wrongdoing or liability on the part of the Company or Releasees or by you.

  
 7. Return of Documents and Property. You represent that you have
returned to the Company all known equipment, data, material, books, records, documents (whether stored electronically or on computer hard drives or disks), computer disks, credit cards, Company keys, I.D. cards and other property, including, without
limitation, fax machine, printers, and other electronic devices in your possession, custody, or control which are or were owned and/or leased by the Company in connection with the conduct of the business of the Company (collectively referred to as
“Company Property”). Knight has agreed that you may keep your company laptop so long as all company information has been removed from that laptop. You will also be entitled to keep your company cell phone, which Knight will move into your
own name for billing and ownership purposes. You further warrant that you have not retained, or delivered to any person or entity, copies of Company Property or permitted any copies of Company Property to be made by any other person or entity.

  
 8. Non-Disparagement. You shall not issue or authorize any disparaging
comments or statements, to present or former employees of Knight (or of its subsidiaries or affiliates), or to any individual or entity with whom or which Knight or any of its subsidiaries or affiliates has a business relationship, or to others,
which could affect adversely the conduct of Knight’s business or its reputation or the conduct of business or the business or reputation of any of Knight’s current or former parents, subsidiaries, affiliates, officers, directors or
employees. 
  
 9. Confidentiality. You agree to maintain the
confidentiality of, and refrain from disclosing, making public, or discussing in any way whatsoever the terms and conditions of this Agreement and Release. Notwithstanding the foregoing, it is understood that as the sole exceptions to this
confidentiality provision: (i) you may discuss this Agreement and Release with your spouse; (ii) you may discuss this Agreement and Release with your attorneys; (iii) you may permit appropriate public accountants to review this Agreement and Release
in connection with the conduct of an audit, and may permit attorney(s), accountant(s) and tax advisor(s) of your choice to review this Agreement and Release in connection with the receipt of advice on the taxability of the compensation, payments and
benefits set forth in Paragraphs 2 and 3 of this Agreement and Release, your rights hereunder, or to answer inquiries with respect thereto; (iv) you may disclose the terms of this Agreement and Release to the Internal Revenue Service and any similar
state taxing authorities, if requested by such authorities or as necessary to comply with all applicable income tax laws; and (v) you may disclose the terms of this Agreement and Release as provided for in Paragraph 11 below. To the extent that you
divulge the terms of this Agreement and Release to any of the individuals described in (i), (ii) and (iii) above, you shall advise each such individual of this confidentiality provision and instruct each such individual of the confidential nature of
this Agreement and Release and that each such individual must comply with the confidentiality terms of this Agreement and Release and not divulge any of the terms and conditions thereof. The Company agrees to maintain appropriate confidentiality
with regard to the terms and conditions of this Agreement and Release. You recognize and agree, however, that the Company may be required to disclose, and is permitted to disclose, the terms and conditions of this Agreement and Release by law or in
connection with its normal business operations. 

 Mr. Derek Stein 
 August 1,
2005 
 Page 5 
  

	10. 	Confidentiality; Non-Disclosure. Except as otherwise provided in this document: 

  
 a. You agree that you will keep confidential, and not disclose, nor use for your benefit or the benefit of any other person
or entity, any written material, records, documents or information made by you or coming into your possession during the course of your employment with Knight, that contain information which is confidential or proprietary to Knight or which
constitutes trade secrets of Knight and which: (i) has not been disclosed publicly by Knight, or (ii) is otherwise not a matter of public knowledge, or (iii) is a matter of public knowledge but which you have reason to know became a matter of public
knowledge through an unauthorized disclosure. Proprietary or confidential information is defined as information that has been developed by Knight and is unique to Knight, the unauthorized disclosure or use of which could reduce the value of such
information to Knight including, without limitation, Knight’s client lists, its trade secrets, any confidential information about (or provided by) any current or former officer, director, employee, client or prospective client of Knight, and
any written material referring or relating to legal, litigation or regulatory matters. Nothing herein shall prevent you from retaining and utilizing your professional business experience and personal records, including copies of benefit plans and
programs in which you retain an interest, contract lists, desk calendars or other personal office effects. 
  
 b. You agree you shall not issue, authorize, or condone comments or statements to the press concerning Knight or any of its parents, affiliates, officers,
or directors other than to say “I cannot comment.” You shall notify Knight’s General Counsel if you have been contacted by the press or broadcast media. 
  

	11. 	Permitted Disclosure. 

  
 a. Nothing in this Agreement shall prohibit or restrict you from: (i) making any disclosure of information required by law or legal process; or (ii)
providing information to, or testifying or otherwise participating in or assisting in any investigation or proceeding brought by, any federal or state regulatory or law enforcement agency or legislative body, any self-regulatory organization, or
Knight’s Legal or Compliance Departments. 
  
 b. To the
extent permitted by law, you agree to give Knight timely and prompt written notice (in the manner provided for herein) of the receipt of any subpoena, court order or other legal process compelling the disclosure of any information and/or documents
relating to Knight so as to allow Knight reasonable opportunity to take such action as may be necessary in order to protect such information and/or documents from disclosure. 
  
 12.  Cooperation. You agree to cooperate with Knight and its counsel in connection with any investigation, administrative
proceeding or litigation relating to any matter in which you were involved or of which you have knowledge as a result of your employment by Knight. 

 Mr. Derek Stein 
 August 1,
2005 
 Page 6 
  
 13. Non Solicit. Until August 1, 2006, you will not, without the prior written consent of Knight, directly or indirectly solicit, encourage, or induce any employee of Knight or its affiliated entities to
terminate his or her employment with Knight. 
  
 14. Modifications. This
Agreement and Release may not be changed orally, and no modification, amendment or waiver of any of the provisions contained in this Agreement and Release, nor any future representation, promise or condition in connection with the subject matter of
this Agreement and Release, shall be binding upon any party hereto unless made in writing and signed by such party. 
  
 15. Governing Law. This Agreement and Release shall be subject to and governed by and interpreted in accordance with the laws of the State of New Jersey without
regard to conflicts of law principles. You hereby: (i) irrevocably submit to the jurisdiction of any arbitration panel or any state or federal court sitting in the State of New Jersey, for the purposes of any suit, action or other proceeding arising
out of or relating to this Agreement and Release; and (ii) waive and agree not to assert in any such proceeding a claim that you are not personally subject to the jurisdiction of the court referred to above, or that the suit or action was brought in
an inconvenient forum. 
  
 16. Assignment. This Agreement and Release shall
be binding upon you and your executors, administrators and heirs. The Company may, at its sole discretion, sell or otherwise assign any rights, obligations or benefits it has under this Agreement and Release. You may not sell or otherwise assign any
rights, obligations or benefits under this Agreement and Release, and any attempt to do so shall be void. 
  
 17. Entire Agreement. This Agreement and Release contains the entire agreement between the parties and supersedes and terminates any and all previous agreements between them, whether written or oral.

  
 18. Specific Enforcement. The parties agree that this Agreement and
Release may be specifically enforced in court or arbitration and may be used as evidence in a subsequent proceeding in which any of the parties allege a breach of this Agreement and Release. In the event any action, suit or other proceeding is
brought to interpret, enforce or obtain relief from a breach of this Agreement and Release, the prevailing party shall recover all such party’s reasonable costs, expenses and attorneys’ fees incurred in each and every such arbitration,
action, suit or other proceeding, including any and all appeals or petitions therefrom. 
  
 19. Notices. All notices in connection with or provided for under this Agreement and Release shall be validly given or made only if made in writing and delivered personally, by facsimile or mailed by registered or certified mail,
return receipt requested, postage prepaid, to the party entitled or required to receive the same, as follows: 
  
 If to Derek Stein, addressed to: 
  
 [Address] 
 [Address] 
 [Phone] 

 Mr. Derek Stein 
 August 1,
2005 
 Page 7 
  
 If to the Company, addressed to: 
  
 Joan Fader 
 Knight Equity Markets L.P.

 545 Washington Boulevard, 3rd Floor 
 Jersey City, New Jersey 07310 
 Phone: 201-557-6952 
 Fax    : 201-222-7869 
  
 or
at such other address as either party may designate to the other by notice similarly given. Notice shall be deemed to have been given upon receipt in the case of personal delivery or facsimile and upon the date of receipt indicated on the return
receipt in the case of mail. 
  
 20. Severability. If, at any time after
the Effective Date of this Agreement, any provision of this Agreement shall be held by any court or other forum of competent jurisdiction to be illegal, void, or unenforceable, such provision shall be of no force and effect. The illegality or
unenforceability of such provision, however, shall have no effect upon, and shall not impair the enforceability of, any other provision of this Agreement; provided, however, that upon a finding by a court of competent jurisdiction that
the release set forth in Paragraph 5 is illegal and/or unenforceable, Knight shall be released from any obligations hereunder. 
  
 21. Acknowledgment. By signing this Agreement and Release, you certify that you have read the terms of this Agreement and Release, and that your execution of this
Agreement and Release shall indicate that this Agreement and Release conforms to your understanding and is acceptable to you as a final agreement. You further acknowledge and agree that you have been advised of the opportunity to consult with
counsel of your choice and that you have been given a reasonable and sufficient period of time of not less than twenty-one (21) days in which to consider and return this Agreement and Release. You further acknowledge and agree that upon your
execution and return of this Agreement and Release, you will be permitted to revoke the Agreement and Release at any time during a period of seven (7) calendar days following your execution hereof. To be effective, the revocation must be in writing
and must be hand-delivered or telecopied to the Company within the seven (7) day period. This Agreement and Release will not be effective until the seven (7) day period has expired without revocation (hereinafter, the “Effective Date”). If
the Agreement and Release is not executed and returned on or before August 29, 2005, or if this Agreement and Release is executed and then revoked within the aforementioned seven (7) day period, this Agreement and Release will be of no further force
or effect, and neither you nor the Company will have any rights or obligations hereunder. 

 Mr. Derek Stein 
 August 1,
2005 
 Page 8 
  
 We appreciate your service to Knight, and we wish you the best in all your future endeavors. 
  
 Sincerely yours, 
  

			
	By:	 	 /s/ Bronwen Bastone

	 	 	Bronwen Bastone
	 	 	Director
	 	 	Knight Equity Markets, L.P.

  

			
	 	 	Date: 08-31-2005
	 /s/ Derek Stein

	 	 
	Derek Stein	 	 
		
	Subscribed and Sworn to before me	 	 
		
	This 31st day of August 2005	 	 
	  
 /s/ Notary Public

	 	 
	  

	 	 
		
	NOTARY PUBLICEmployment Agreement of William Peters

 Exhibit 10.1 
  
 EMPLOYMENT AGREEMENT, effective as of August 1, 2005, by and between HI-TECH PHARMACAL CO., INC., a Delaware
corporation with offices at 369 Bayview Avenue, Amityville, New York 11701 (the “Corporation”), and WILLIAM PETERS, an individual residing in Southampton, New York (the “Executive”). 
  
 W I T N E S S E T H 
  
 WHEREAS, the Corporation desires to secure the services of Executive
upon the terms and conditions hereinafter set forth; and 
  
 WHEREAS, Executive desires to render services to the Corporation upon the terms and conditions hereinafter set forth. 
  
 NOW, THEREFORE, the parties mutually agree as follows: 
  
 Section 1. Employment. The Corporation hereby employs Executive and Executive hereby accepts such employment, as an executive of the Corporation,
subject to the terms and conditions set forth in this Agreement. 
  
 Section 2. Duties. Executive shall serve as Vice President and Chief Financial Officer of the Corporation and shall properly perform such duties as may be assigned to him from time to time by the Chief Executive Officer and/or Board
of Directors of the Corporation. If requested by the Corporation, Executive shall serve on any committee of the Board of Directors without additional compensation. During the term of this Agreement, Executive shall devote substantially all of his
available business time to the performance of his duties hereunder unless otherwise authorized by the Board of Directors. 
  
 Section 3. Term of Employment. The term of this contract shall commence as of August 1, 2005 and shall continue until July 31, 2007 and shall
automatically renew for successive one year terms unless terminated by the Corporation upon six months’ advance written notice to Executive of the Corporation’s decision not to renew the contract, or by Executive, upon 30 days advance
written notice to the Corporation, or unless earlier terminated pursuant to the provisions of Section 5 hereof. 
  
 Section 4. Compensation of Executive. 
  
 4.1. Compensation. As compensation for his services hereunder the Corporation shall pay Executive (i) for the period August 1, 2005 through July
31, 2006 (“Year One”), an annual salary (“Salary”) equal to $210,000 ($4,038.46 per week); and (ii) for the period August 1, 2006 through July 31, 2007 (“Year Two”), an annual salary (“Salary”) equal to
$220,500 ($4,240.38 per week). Executive’s compensation after July 31, 2007 shall be adjusted upward annually on August 1 of each year by the greater of 5% or the annual percentage change in the New York City Metropolitan Consumer Price Index
or such other agreed upon substitute. The Salary shall be payable weekly less such deductions as shall be required to be withheld by applicable law and regulations. 

 4.2. Bonus; Stock Options. 
  
 (a) In addition to his annual Salary, Executive shall receive a bonus (“Bonus”) during each year of employment.
The Bonus for each of Year One, Year Two and each successive term shall be determined in accordance with the performance goals set by the Compensation Committee of the Board of Directors and the President of the Corporation in their sole discretion.
The Compensation Committee and the President shall set a target for the Bonus which shall be equal to or greater than twenty-five (25%) percent of the Executive’s annual salary; provided, however, that such target bonus is not binding on the
Committee or President. The Bonus shall be paid in cash within 30 days of August 1 of each year. 
  
 (b) During Year One of the term of this Agreement, Executive shall receive, at the commencement of Year One, options to purchase a minimum of twenty-five
thousand (25,000) shares of the Corporation’s Common Stock, each in accordance with the terms and provisions of the Corporation’s Amended and Restated Stock Option Plan (the “Plan”). After commencement of Year Two the Option
Committee shall either approve the grant of options to Executive to purchase twenty-five thousand (25,000) shares of the Corporation’s Common Stock, or, in the discretion of the Compensation Committee shall approve other stock based or other
compensation which the Corporation may grant in lieu of stock options to executives of the Company. The value of such stock based or other compensation (excluding salary or bonus) shall be consistent with such compensation granted to other
executives of the Company. Options shall vest in 25% increments on the first through fourth anniversaries of the grant date and shall be governed by the terms of the Plan, a copy of which has been provided to Executive. 
  
 4.3. Expenses. The Corporation shall pay or reimburse Executive for
all reasonable and necessary business, travel or other expenses incurred by him, upon proper documentation thereof, which may be incurred by him in connection with the rendition of the services contemplated hereunder. 
  
 4.4. Car Allowance. The Corporation shall pay to the Executive a car
allowance of $500 per month for the term of the contract. 
  
 4.5. Benefits. During the term of this Agreement and all extensions thereto, Executive shall be entitled to participate in such pension, profit sharing, group insurance, option plans, hospitalization, and group health benefit plans
and all other benefits and plans as the Corporation provides to its senior executives, which benefits plans will cover Executive and his dependants. 
  
 4.6. Life Insurance; Disability Insurance. The Corporation shall procure for Executive, at the Corporation’s expense, term life insurance and
long-term disability insurance as more specifically detailed on Exhibit A attached hereto. 
  
 4.7. Discretionary Payments. Nothing herein shall preclude the Corporation from paying Executive such bonus or bonuses or other compensation, as the Board of Directors, in its discretion, may authorize from
time to time. 
  
 Section 5. Termination. 
  
 5.1. Termination. This Agreement and Executive’s employment

  

 2 

 hereunder shall terminate upon Executive’s death or Total Disability, upon termination of employment of Executive
For Cause, upon Executive leaving his employment hereunder, or by the Corporation upon six months advanced written notification to Executive of the Corporation’s decision not to renew this Agreement. 
  
 5.2. Termination For Cause or Termination By Executive. In the event
Executive is discharged For Cause, as hereinafter defined, or if this Agreement is not renewed by the Corporation upon at least 6 months’ advance written notice or Executive leaves his employment hereunder, this Agreement shall be deemed
terminated and the Corporation shall be released from all obligations to Executive with respect to this Agreement, except as provided in section 10.7 hereto. 
  
 5.3. Definitions. As used herein, the term “For Cause” shall mean (i) the Executive’s indictment, plea or conviction of any
criminal violation involving misappropriation of money or other property, dishonesty, fraud, breach of trust or any other crime involving moral turpitude which constitutes a felony, whether or not involving the Corporation; (ii) the Executive’s
willful engagement in gross misconduct in the performance of his duties that materially injures the Corporation; (iii) the Executive’s violation of Sections 8 or 9 of this Agreement; (iv) the Executive’s habitual drunkenness or habitual
use of illegal substances; (v) the Executive’s gross negligence or fraud in the preparation of the Corporation’s financial statements causing their restatement due to errors, omissions, or fraud in their preparation; or (vi) the
Executive’s willful and continuous failure to substantially perform his duties under this Agreement, including but not limited to failure resulting from gross insubordination. A termination of Executive pursuant to subparagraph (vi) shall occur
only after the Board provides written notice to the Executive of his failure and 30 calendar days’ opportunity to cure such failure. An act of the Executive will not be deemed “willful” unless done or omitted to be done by the
Executive not in good faith and without reasonable belief that the act or omission was in the Corporation’s best interests. 
  
 5.4. Payments. If Executive’s employment is terminated, or if Executive terminates his employment for Good Reason, as defined in this
Agreement, then Corporation shall pay to Executive after such termination, severance payments (“Severance”) equal to the sum of (i) Executive’s Salary for the greater of six (6) months or the balance of the term of this Agreement and
(ii) the pro rata portion of Executive’s annual bonus for the prior year. The Severance shall be payable weekly less such deductions as shall be required to be withheld by applicable law and regulations. In addition, the Corporation shall
continue to keep in force and effect all health, insurance and welfare benefits for Executive and Executive’s dependents for a period of the lesser of six months from the date of Executive’s termination or until Executive and his
dependents are eligible for similar health, insurance and welfare benefits from Executive’s new employer. Executive shall not be entitled to Severance if the Corporation gives six months advance written notice to Executive of the
Corporation’s decision not to renew this Agreement, or if Executive’s employment is terminated For Cause, as defined in this Agreement, or if Executive’s employment is terminated due to Executive’s death or Total Disability or if
Executive’s employment is terminated due to a Change in Control, as defined in this Agreement. If Executive’s employment is terminated due to a Change in Control, payments shall be made to Executive in accordance with Section 11 of this
Agreement. 
  

 3 

 5.5. Termination for Good Reason. Good Reason shall include any of the following, (i) any
assignment of Executive’s duties inconsistent with Executive’s position of Vice President and Chief Financial Officer or which constitutes a significant reduction in authority, responsibilities, or status, (ii) any demotion, including, but
not limited to reporting to an individual in the Corporation who is not the Corporation’s CEO or Board of Directors, (iii) requiring Executive to have his principal place of employment more than 15 miles beyond the Corporation’s principal
place of business as of the effective date of this Agreement, without providing Executive with relocation benefits for relocation expenses (packing, unpacking, moving company charges, attorneys’ fees, inspection costs, title insurance and other
closing costs including brokerage fees for selling Executive’s home, excluding any points on financing a new house or costs of renovating a new residence), (iv) any attempted reduction in Executive’s base salary, or other benefit plans, or
the level, amount or value of any accrued benefit, or (v) any attempted reduction, during Year One or Year Two, of Executive’s Bonus or stock option grants which are inconsistent with the provisions of this Agreement. 
  
 5.6. Stock Options. 
  
 (a) Upon the death or Total Disability of Executive, or in the event of a
Change in Control, all stock options granted to Executive under the Plan (“Stock Options”) shall automatically become fully vested and immediately exercisable. 
  
 (b) In the event Executive is terminated without cause, or if the Executive terminates for Good Reason, then
Executive’s previously granted and unexercised Stock Options shall continue to vest on their regular vesting dates until the date this Agreement would have terminated had there not been a termination. 
  
 (c) In the event Executive is terminated For Cause or leaves his employment
hereunder other than for Good Reason, all unvested Stock Options shall immediately terminate and be forfeited. 
  
 (d) In the event there is a conflict between the terms of this Agreement and the Plan, this Agreement shall govern. 
  
 Section 6. Disability. 
  
 6.1. Total Disability. In the event Executive is mentally or
physically incapable or unable to perform his regular and customary duties of employment with the Corporation for a period of ninety (90) days in any one hundred twenty (120) day period, Executive shall be deemed to be suffering from a “Total
Disability” and the Corporation shall be entitled to terminate this Agreement. 
  
 6.2. Payment During Disability. In the event Executive is unable to perform his duties hereunder by reason of a disability, which disability does not constitute Total Disability, the Corporation shall continue
to pay Executive his Salary during the continuance of such disability. To the extent any Proceeds from a disability insurance policy owned by the Corporation are paid to Executive or his designee, the Corporation shall receive a credit against its
obligations under this Section 6.2 in an amount equal to the Proceeds. 
  

 4 

 Section 7. Vacations. The Executive shall be entitled to a vacation of four (4) weeks for each of
Year One and Year Two and all extensions thereof, during which period his Salary shall be paid in full. The Executive shall take his vacation at such time or times as Executive and the Corporation shall determine is mutually convenient. 

 
 Section 8. Disclosure of Confidential Information. 
  
 8.1. Disclosure. Executive hereby acknowledges that the principal
business of the Corporation is the marketing and distribution of generic and branded pharmaceutical products and such other businesses as the Corporation may conduct from time to time (the “Business”). Executive acknowledges that he will
acquire confidential information concerning the Corporation, the Business, its products, know-how, customers and plans and that, among other things, his knowledge of the Business will be enhanced through his employment by the Corporation. Executive
acknowledges that such information is of great value to the Corporation, is the sole property of the Corporation, and has been and will be acquired by him in confidence. 
  
 8.2. Confidentiality. In consideration of the obligations undertaken by the Corporation herein, Executive will not,
at any time during or after the term of Executive’s employment with the Corporation, directly or indirectly, use for Executive’s own benefit or any other party’s benefit, or reveal, divulge or make known to any person, any information
which is treated as confidential by the Corporation and not otherwise in the public domain. Confidential information shall not include information which was previously known by Executive, information which was given to Executive by any third party
under no obligation of confidentiality, or information which Executive is required to disclose as a result of a governmental investigation or by a court order. Executive agrees that all materials or copies thereof containing confidential information
of the Corporation in Executive’s custody or possession will not, at any time, be removed from the Corporation’s premises without the prior written consent of the Chief Executive Officer of the Corporation and shall be delivered to the
Corporation upon the earlier of (i) a request by the Corporation or (ii) the termination of Executive’s employment with the Corporation. After such delivery, Executive shall not retain any such materials or copies thereof. 
  
 8.3. Survival. The provisions of this Section 8 shall survive
Executive’s employment hereunder for a period of three years. 
  
 Section 9. Conflicts of Interest; Insider Trading. 
  
 9.1. Conflicts of Interest. In order to avoid actual or apparent conflicts of interest, except with the Corporation’s consent, Executive shall not have any direct or indirect ownership or financial interest in any company,
person or entity which is: (i) a service provider to, or vendor of, the Corporation; (ii) a customer of the Corporation; or (iii) a competitor of the Corporation. Executive shall not be deemed to have any direct or indirect ownership or financial
interest for any such interest that does not exceed two percent (2%) of the issued and outstanding voting securities of any class of any corporation whose voting capital stock is traded on a national securities exchange or in the over-the-counter
market. 
  
 9.2. General Requirements. The Executive shall
observe such lawful policies of the Corporation as may from time to time apply. 
  

 5 

 9.3. Insider Trading. Considering that the Corporation is a publicly-traded corporation,
Executive hereby agrees that Executive shall comply with any and all federal and state securities laws, including but not limited to those that relate to non-disclosure of information, insider trading and individual reporting requirements and shall
specifically abstain from discussing the non-public aspects of the Corporation’s business affairs with any individual or group of individuals (e.g., Internet chat rooms) who does not have a business need to know such information for the benefit
of the Corporation. The Executive hereby agrees to immediately notify the Corporation’s Compliance Officer in accordance with the Corporation’s Insider Trading Policy prior to Executive’s acquisition or disposition of the
Corporation’s securities. 
  
 Section 10.
Indemnification. 
  
 10.1. Indemnification. The
Corporation hereby agrees to indemnify and hold harmless Executive to the fullest extent permitted by the Corporation’s Certificate of Incorporation, By-Laws, the Delaware General Corporation Law or any other applicable law, as any or all may
be amended from time to time. Such reimbursements shall include but not be limited to Executive’s reasonable and necessary out of pocket expenses including attorneys fees, settlement payments and any other such costs and expenses. 

 
 10.2. Directors and Officers Policy. The Corporation shall ensure
that its Directors’, Officers’, Insured Entity and Employment Practices Liability Insurance policy (“D&O Policy”) shall cover Executive as an Insured Person, as such term is defined in the D&O Policy. Such D&O Policy
is currently in effect and the Corporation knows of no reason why such policy would be terminated or allowed to lapse. If so, the Corporation shall immediately notify Executive of such policy termination. 
  
 10.3. Undertaking. To the extent that the Corporation advances
payment for any fees or expenses to Executive pursuant to this Section 10, such advance shall be accompanied by a written undertaking by Executive to repay such amounts if it shall be ultimately determined by a court of competent jurisdiction in a
final disposition, that Executive (i) is not entitled to be indemnified by the Corporation or (ii) that the amount advanced exceeded the indemnification to which he is entitled, in which case the amount of such excess shall be repaid to the
Corporation. 
  
 10.4. Notice. As a condition precedent to
his right to be indemnified hereunder, Executive shall give the Corporation notice in writing as soon as practicable of any claim made against him for which indemnity will or could be sought under this Agreement. 
  
 10.5. Cooperation. Executive shall fully cooperate with the
Corporation in connection with any matter, which results in the assertion of a claim by Executive for indemnification hereunder. The Corporation shall be entitled at its own expense to participate in the defense of any proceeding, claim or action,
or, if it shall elect, to assume such defense, in which event such defense shall be conducted by counsel chosen by the Corporation, subject to the consent of Executive, which consent shall not be unreasonably withheld or delayed. 
  

 6 

 10.6. Exceptions. The Corporation shall not be liable under this Agreement to make any payment in
connection with any claim: 
  
 (a) For which payment is actually
made to Executive under valid and collectable insurance policies, premiums for which are paid by the Corporation or any of its affiliates, except in respect of any deductible and excess beyond the amount of payment under such insurance; 

 
 (b) For which Executive is indemnified by the Corporation otherwise than
pursuant to this Agreement, provided such amount has previously been paid to Executive; 
  
 (c) Brought about or contributed to by the dishonesty of Executive seeking payment hereunder; and 
  
 (d) By Executive who acts as a plaintiff suing the Corporation, its affiliates or other directors, officers or shareholders of the Corporation or its
affiliates or other directors or officers of the Corporation or its affiliates except with regard to Executive’s successful enforcement of Section 10.1 hereof.  
  
 10.7. Survival. The obligations of the Corporation hereunder will survive (i) any actual or purported termination of
this Agreement by the Corporation or its successors or assigns, whether by operation of law or otherwise, (ii) any change in the Corporation’s Certificates of Incorporation or By-laws, and (iii) termination of Executive’s services to the
Corporation or its affiliates (whether such services were terminated by the Corporation, such affiliate or Executive), if such claim arises as a result of an occurrence prior to the termination of this Agreement, whether or not a claim is made or an
action or proceeding is threatened or commenced before or after the actual or purported termination of this Agreement, change in the Corporation’s Certificate of Incorporation or By-laws, or termination of Executive’s services. 

 
 Section 11. Change in Control. 
  
 11.1. Payment on Change in Control. The Corporation will provide or
cause to be provided to Executive the rights and benefits described below during the term of this Agreement, following a Change in Control. In the event of a Change in Control the Corporation shall pay or cause its successor to pay to Executive, in
cash, in a lump sum within 15 days after the Change in Control, an amount equal to 1.5 times Executive’s base compensation which equals the sum of the following: (i) Executive’s annual salary on the day preceding the Change in Control,
plus (ii) Executive’s annual bonus for the year immediately preceding the Change in Control. In addition, following a Change in Control, at no cost to Executive, the Corporation shall maintain for Executive and Executive’s dependents, all
health, insurance and welfare benefits for the lesser of one year or until Executive and his dependents are eligible for similar health, insurance and welfare benefits from Executive’s new employer. 
  
 11.2. Change in Control Defined. A “Change in Control”
shall be deemed to occur upon the earliest to occur after the date of this Agreement of any of the following events; 
  

 7 

 (a) Acquisition of Stock by Third Party. Any Person (as hereinafter defined) is or becomes the
Beneficial Owner (as hereinafter defined), directly or indirectly, of securities of the Corporation representing forty (40%) percent or more of the combined voting power of the Corporation’s then outstanding securities and such Person initiates
actions to cause the Corporation to enter into a transaction or series of transactions with such Person or a third party without the prior consent or request of the Board of Directors; 
  
 (b) Change in Board of Directors. The date when Continuing Directors cease to be a majority of the Directors then in
office, it being understood that it shall not be deemed a Change in Control as long as the majority of the Directors were nominated by the Continuing Directors; 
  

(c) Corporate Transactions. The effective date of a merger or consolidation of the Corporation with any other entity, and with the power to
elect at least a majority of the board of directors or other governing body of such surviving entity; and 
  
 (d) Liquidation. The approval by the shareholders of the Corporation of a complete liquidation of the Corporation or an agreement for the sale or
disposition by the Corporation of all or substantially all of the Corporation’s assets. 
  
 (e) Certain Definitions. For purposes of this Section 11, the following terms shall have the following meanings: 
  
 (i) “Person” shall have the meaning as set forth in Section 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended
(“Exchange Act”); provided, however, that Person shall exclude (i) the Corporation, (ii) any trustee or other fiduciary holding securities under an employee benefit plan of the Corporation, (iii) any corporation owned, directly or
indirectly, by the shareholders of the Corporation in substantially the same proportions as their ownership of stock of the Corporation, and (iv) any members of the Seltzer family, including affiliates, trusts and foundations for the benefit of
Seltzer family members. 
  
 (ii)
“Beneficial Owner” shall have the meaning given to such term in Rule 13d-3 under the Exchange Act. 
  
 (iii) “Continuing Directors” as used in this Agreement shall mean the persons who constitute the Board of Directors of the
Corporation on the date hereof together with their successors whose nominations were approved by a majority of Continuing Directors. 
  
 Section 12. Miscellaneous. 
  
 12.1. Injunctive Relief. Executive agrees that any breach or threatened breach by him of Sections 8 or 9 of this Agreement shall entitle the
Corporation, in addition to 
  

 8 

 all other legal remedies available to it, to apply to any court of competent jurisdiction to enjoin such breach or
threatened breach. The parties understand and intend that each restriction agreed to by Executive herein shall be construed as separable and divisible from every other restriction, that the unenforceability of any restriction shall not limit the
enforceability, in whole or in part, of any other restriction, and that one or more or all of such restrictions may be enforced in whole or in part as the circumstances warrant. In the event that any restriction in this Agreement is more restrictive
than permitted by law in the jurisdiction in which the Corporation seeks enforcement thereof, such restriction shall be limited to the extent permitted by law. 
  

12.2. Assignment. Neither Executive nor the Corporation may assign or delegate any of their rights or duties under this Agreement, except as
provided in Section 10.5 hereof. 
  
 12.3. Entire
Agreement. This Agreement constitutes and embodies the entire and complete understanding and agreement of the parties with respect to Executives’ employment by the Corporation, supersedes all prior understandings and agreements, if any,
whether oral or written, between Executive and the Corporation and shall not be amended, modified or changed except by an instrument in writing executed by the party to be charged. The invalidity or partial invalidity of one or more provisions of
this Agreement shall not invalidate any other provision of this Agreement. No waiver by either party of any provision or condition to be performed shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or any prior or
subsequent time. 
  
 12.4. Binding Effect. This Agreement
shall inure to the benefit of, be binding upon and enforceable against, the parties hereto and their respective successors. 
  
 12.5. Captions. The captions contained in this Agreement are for convenience of reference only and shall not affect in any way the meaning or
interpretation of this Agreement. 
  
 12.6. Notices. All
notices, requests, demands and other communications required or permitted to be given hereunder shall be in writing and shall be deemed to have been duly given when personally delivered or sent by fax or certified, mail, postage prepaid, to the
party at the address set forth above or to such other address as either party may hereafter give notice of in accordance with the provisions hereof. 
  
 12.7. Governing Law. This Agreement shall be governed by and interpreted under the laws of the State of New York applicable to contracts made and
to be performed therein without giving effect to the principles of conflict of laws thereof. Except in respect of any action commenced by a third party in another jurisdiction, the parties hereto agree that any legal suit, action, or proceeding
against them arising out of or relating to this Agreement may be brought in the United States Federal Courts in the State of New York or the state courts, in the State of New York. The parties hereto hereby accept the jurisdictions of such courts
for the purpose of any such action or proceeding, and agree that venue for any action or proceeding brought in the State of New York shall lie in the United States Federal Courts in the Eastern District or any state court located in Nassau County,
New York, as the case may be. By its execution hereof, the parties hereby irrevocably waive any objection and any right of immunity on the ground of venue, the convenience of the forum or the jurisdiction of such courts or from the execution of
judgments resulting therefrom. The parties hereby irrevocably accept and submit to the jurisdiction of the aforesaid courts in any such suit, action or proceeding. 
  

 9 

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

 10 

 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date set forth
above. 
  

			
	HI-TECH PHARMACAL CO., INC.
	
	 /s/ David Seltzer

	 By: David Seltzer, President and Chief
 Executive Officer

	Dated:	 	 
	
	 /s/ William Peters

	WILLIAM PETERS
	Dated: 8/18/05

  

 11 

 EXHIBIT A 
  

Description of Life Insurance and Disability Insurance 
  
 Term Life Insurance Policy with death benefit of $1,000,000, but in no event, at a cost to the Corporation of greater than $1,500 per annum. 
  
 Long-term Disability Policy with annual benefit of 60% of Executive’s Salary up to age
65. 
  

 12

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00090-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00090-of-00352.parquet"}]]