Document:

Exhibit 4.4

MINRAD INC.

REGISTRATION RIGHTS AGREEMENT

               
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made as of
________, 2004 by and among MINRAD INC., a Delaware corporation (the "Company")
and each INVESTOR executing a copy hereof ("Investor").

               
WHEREAS, certain of the Investors are persons who desire to purchase from the
Company, and the Company desires to issue and sell to them, a minimum offering
of 1,760,000 shares of common stock of the Company, par value $.01 per share ("Common
Stock"), and a maximum offering of 3,200,000 shares of Common Stock,
(collectively, the "Shares"), all upon the terms set forth in the
Company's Confidential Private Placement Memorandum (the "Memorandum")
and Subscription Agreement included herewith; and 

               
WHEREAS, certain of the Investors are person who have existing registration
rights with respect to registration of Common Stock under agreements with the
Company, which registration rights the parties desire to make consistent with
the rights granted in this Agreement; and 

               
WHEREAS, the Company has agreed to undertake to register Common Stock if, as and
when required hereunder, under the terms set forth herein.

               
NOW, THEREFORE, the parties hereto hereby covenant and agree as follows:

               
1.     Certain Definitions. As used in this Agreement,
the following terms shall have the following respective meanings:

               
"Commission" shall mean the Securities and Exchange Commission, or any
other federal agency at the time administering the Securities Act.

               
"Common Stock" shall mean the Common Stock, par value $.01 per share, of
the Company.

               
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, or any similar federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect at the time.

               
"Final Closing Date" shall mean the final closing date of the sale of
Shares in the offering to Investors pursuant to the Memorandum.

               
"Holdback Period" shall mean the period commencing on the day on which
the IPO shall be consummated and ending on (i) the date which is 180 days
thereafter or (ii) such earlier date as shall have been agreed between the
underwriter of the IPO, the Company and the Placement Agent, acting on behalf of
the Investors pursuant to Section 5(c) hereof. For clarification and without
limitation, an IPO for the Holdback Period shall not include any merger
with a Merger Successor (defined below), any IPO by a Merger Successor prior to
its merger with or into the Company, or any subsequent P.I.P.E. offering
(defined below) of the Company's securities following said merger. 

               
"IPO" shall mean the initial public offering of the Company's securities
that is registered under the Securities Act. For clarification and without
limitation, IPO shall not mean a merger with a Merger Successor, any IPO of the
Merger Successor prior to its merger with or into the Company, or any P.I.P.E.
offering of the Company's securities.

               
"Liquidity Event" shall mean (i) the effectiveness of the IPO, (ii) any
merger, consolidation or business combination of the Company with any other
entity other than an affiliate of the Company and pursuant to which the Company
is not the surviving entity, (iii) any sale of all or substantially all of the
assets of the Company, or (iv) any bona fide offer by the Company or a third
party, approved by the Company's board of directors, to purchase, at a price not
less than fair market value, all or substantially all of the securities of the
Company.

               
"Placement Agent" shall mean Cagan McAfee Capital Partners, LLC.

               
"Public Sale" shall mean any sale of securities to the public pursuant to
(i) an offering registered under the Securities Act or (ii) the provisions of
Rule 144 (or any similar rule or rules then in effect) under the Securities Act.

               
"Register," "registered" and "registration" shall mean a
registration effected by preparing and filing a registration statement or
statements or similar documents in compliance with the Securities Act and the
declaration or ordering of effectiveness of such registration statement or
document by the Commission.

               
"Registrable Securities" shall mean all shares of Common Stock now held
or hereafter acquired from the Company by the Investors, and any shares of
Common Stock issued as a dividend or other distribution with respect to, or in
exchange for or in replacement of, such Common Stock, as the case may be. As to
any particular shares of Common Stock constituting Registrable Securities, such
shares shall cease to be Registrable Securities when (A) they have been
transferred in a Public Sale in a transaction such that all transfer
restrictions and restrictive legends under the Securities Act with respect
thereto are or may be removed upon consummation of such sale, or (B) sold or
available for sale in the opinion of counsel to the Company in a single
transaction exempt from the registration and prospectus delivery requirements of
the Securities Act so that all transfer restrictions and restrictive legends
under the Securities Act with respect thereto are or may be removed at the
consummation of the transaction.

               
"Requisite Period" shall mean, (i) with respect to a firm commitment
underwritten public offering, the period commencing on the effective date of the
registration statement and ending on the date each underwriter has completed the
distribution of all securities purchased by it, and, (ii) with respect to any
other registration, the period commencing on the effective date of the
registration statement and ending on the earlier of the date on which the sale
of all Registrable Securities covered thereby is completed or 180 days after
such effective date.

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"Securities Act" shall mean the Securities Act of 1933, as amended, or
any similar federal statue, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the applicable time.

               
"Stockholders" shall mean the Investors.

               
2.     Automatic and Demand Registration. 

                       
(a)     If the Company shall complete an IPO or if the
Company shall be merged with or into a company whose shares are registered under
the Exchange Act (a "Merger Successor") prior to the first anniversary of
the Final Closing Date, then Company shall effect a registration under the
Securities Act of all Registrable Securities requested by the Stockholders to be
so registered not later than twelve months after the closing of such IPO or
merger; provided, however, that if (i) the Company effects the
aforementioned IPO or merger with a Merger Successor and (ii) prior to the first
anniversary of the Final Closing Date the Company or Merger Successor
subsequently consummates an offering of its securities not registered under the
Securities Act for an aggregate amount greater than two and one-half million
dollars ($2,500,000) that is subject to a requirement to register the sale of
the securities by the investors in the unregistered offering (a "P.I.P.E."),
then the Company or Merger Successor shall use its best efforts to effect a
registration that will include all Registrable Securities pursuant to Section 3
of this Agreement together with the P.I.P.E securities not later than 90 days
after the closing of said P.I.P.E. offering. In the event of an automatic
registration under this Section 2(a), the Company shall give a written notice (a
"Registration Notice") to all holders of Registrable Securities.
Thereafter, the Company or Merger Successor shall use its best efforts to
register under the Securities Act, in accordance with the method of disposition
specified in the Registration Notice, all Registrable Securities except for
those requested to be excluded in requests received by the Company from holders
of Registrable Securities within twenty (20) days after the Registration Notice
is given.

                       
(b)     In the event that the Company has not yet completed
an IPO or merger with a Merger Successor within eighteen months from the Final
Closing Date, the holders of Registrable Securities constituting at least a
majority of the total Registrable Securities then outstanding may, by written
notice delivered to the Company within six months after the end of that eighteen
month period (collectively, a "Demand Notice"), require that the Company
register under the Securities Act on one occasion all or any portion of their
Registrable Securities in the manner specified in the Demand Notice.

                       
(c)     Within 10 days of receipt of any Demand Notice under
Section 2(b) above, the Company shall give written notice (a "Company Notice")
to all holders of Registrable Securities from whom a Demand Notice has not been
received. Thereafter, the Company shall use its best efforts to register under
the Securities Act, in accordance with the method of disposition specified in
the Demand Notice, the number of Registrable Securities specified in the Demand
Notice (and in all notices received by the Company from other holders within
twenty (20) days after the giving of such Company Notice). If the method of
disposition shall be an underwritten public offering, the holders  

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of a majority
of the Registrable Securities to be sold in such offering may designate the
managing underwriter of such offering, subject to the approval of the Company,
which approval shall not be unreasonably withheld or delayed. The Company shall
be obligated to register Registrable Securities pursuant to Section 2(b) on one
occasion only; provided, that each such obligation shall be deemed
satisfied only when a registration statement covering all Registrable Securities
specified in notices received as aforesaid, for sale in accordance with the
method of disposition specified in the Demand Notice, shall have become
effective and, if such method of disposition is a firm commitment underwritten
public offering, all such Registrable Securities shall have been sold pursuant
thereto.

                       
(d)     If a demand registration is an underwritten offering
and the managing underwriters shall advise the Company in writing that in their
opinion the number of Registrable Securities requested to be included in such
offering exceeds the number of shares which can be sold in an orderly manner in
such offering within a price range acceptable to the requiring holders without
adversely affecting the marketability of the offering, then the Company will
include in such demand registration (i) first, the Registrable Securities of the
holders originally requesting registration, and (ii) second, other securities
requested to be included in such registration, pro rata from among the other
stockholders of the Company who have registration rights, according to the
number of such securities requested by them to be so included.

               
3.     Piggyback Registration. 

                       
(a)     If the Company at any time (other than pursuant to
Sections 2 or 4 hereof) proposes to register any of its securities under the
Securities Act for sale to the public, whether for its own account or for the
account of other security holders or both (except with respect to the IPO,
merger with a Merger Successor and/or registration statements on Forms S-4 or
S-8 and any similar successor forms) (a "Piggyback Registration"), each
such time it will give prompt written notice to such effect to all holders of
outstanding Registrable Securities at least thirty (30) days prior to such
filing. Upon the written request of any such holder, received by the Company
within twenty (20) days after the giving of any such notice by the Company, to
register any of its Registrable Securities, the Company will, subject to Section
3(b) below, cause all Registrable Securities as to which registration shall have
been so requested to be included in the securities to be covered by the
registration statement proposed to be filed by the Company, all to the extent
requisite to permit the sale or other disposition by the holder of such
Registrable Securities so registered. Notwithstanding the foregoing provisions,
the Company may withdraw any registration statement referred to in this Section
3 without thereby incurring any liability to the Stockholders.

                       
(b)     In the event that any Piggyback Registration shall
be, in whole or in part, an underwritten public offering of Common Stock and the
managing underwriters advise the Company in writing that in their opinion the
number of Registrable Securities and/or other securities requested to be
included in such offering exceeds the number of shares which can be sold in an
orderly manner in such offering within a price range acceptable to the Company
without adversely affecting the marketability of the offering, then the Company
will include in such registration (i) first, the securities the  

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Company proposes
to sell and (ii) second, the Registrable Securities and/or other securities
requested to be included in such registration, pro rata from among the
Stockholders and other stockholders, according to the number of Registrable
Securities and/or other securities requested by them to be so included.
Notwithstanding the foregoing, however, the number of Registrable Securities to
be included in such registration and underwriting under this Section 3(b) shall
not be reduced to less than thirty percent (30%) of the aggregate securities
requested to be included by the Stockholders in such registration without prior
consent of at least a majority of the Stockholders who have requested their
shares to be included in such registration and underwriting.

                       
(c)     The right of the holders of Registrable Securities
to have their securities registered in a Piggyback registration shall terminate
at the earlier of (1) 12 months after an IPO or merger with a Merger Successor,
or (2) nine months after completion of a registration for a P.I.P.E. 

               
4.     Registration on Form S-3. 

                       
(a)     In addition to the rights under Section 2 hereof, if
at any time (i) a holder or holders of at least 20% of the total
Registrable Securities then outstanding request(s) that the Company file a
registration statement on Form S-3 or any successor thereto for a public
offering of all or any portion of the Registrable Securities held by such
requesting holder or holders, where the reasonably anticipated aggregate price
to the public of this public offering would exceed $1,000,000 and (ii) the
Company is a registrant entitled to use Form S-3 or any successor thereto to
register such Registrable Securities, then the Company shall use its best
efforts to register under the Securities Act on Form S-3 or any successor
thereto, in accordance with the method of disposition specified in such notice,
the number of Registrable Securities specified in such notice. Whenever the
Company is required by this Section 4 to use its best efforts to effect the
registration of Registrable Securities, each of the procedures and requirements
of Section 2 (including, but not limited to, the requirement that the Company
notify all holders of Registrable Securities from whom notice has not been
received and provide them with the opportunity to participate in the offering)
shall apply to such registration. The Company shall be obligated to register
Registrable Securities pursuant to this Section 4 on two occasions only and in
no event within six months of a prior registration effected under Sections 2 or
3; provided, that such obligation shall be deemed satisfied on any
occasion only when a registration statement covering all Registrable Securities
specified in notices received as aforesaid, for sale in accordance with the
method of disposition specified by the requesting holders, shall have become
effective and, if such method of disposition is a firm commitment underwritten
public offering, all such Registrable Securities shall have been sold pursuant
thereto, subject to any cut-backs provided for in this Agreement.

                       
(b)     The right of the holders of Registrable Securities
to have their securities registered on Form S-3 under this Section 4 shall
terminate at the earlier of (1) 12 months after an IPO or merger with a Merger
Successor, or (2) nine months after completion of a registration for a P.I.P.E.

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5.     Limitations on Registration; Holdback Agreement;
Power of Attorney.

                       
(a)     Notwithstanding anything to the contrary contained
in this Agreement, the Company shall not be required to file a registration
statement pursuant to Sections 2 or 4 hereof (i) which would become effective
within (A) the Holdback Period, or (B) 120 days following the effective date of
a registration statement (other than a registration statement filed on Form S-4
or S-8) filed by the Company with the Commission pertaining to any prior public
offering for the account of the Company or another holder of securities of the
Company if the holder(s) of Registrable Securities were afforded the
opportunity, subject to the underwriter's cut-back, to include all of its
Registrable Securities in such prior registration pursuant to Section 3, or (ii)
during the period it would violate any restriction or prohibition reasonably
requested by any managing underwriter for the IPO. 

                       
(b)     In connection with the IPO or any registration of
Registrable Securities in connection with an underwritten public offering, the
holders of Registrable Securities agree, if so requested by the underwriter or
underwriters, not to effect any Public Sale or distribution (including any sale
pursuant to Rule 144 under the Securities Act) of any Registrable Securities,
and not to effect any such Public Sale or distribution of any other equity
security of the Company or of any security convertible into or exchangeable or
exercisable for any equity security of the Company (in each case, other than as
part of such underwritten public offering) during (i) the 10 days prior to the
commencement of and during the Holdback Period with respect to the IPO and (ii)
the seven days prior to and the 120 days following the effective date of the
registration statement (other than a registration statement on Form S-4 or S-8)
with respect to such other underwritten public offering if the holders of
Registrable Securities were afforded the opportunity to include all of their
Registrable Securities therein pursuant to Section 3. 

                       
(c)     Each Investor hereby irrevocably appoints the
Placement Agent (and all officers designated by the Placement Agent) ("Attorney")
to act as his or its true and lawful agent and attorney-in-fact, with full power
of substitution, (i) to negotiate with the Company and the managing
underwriter(s) for the IPO the terms and conditions of the holdback agreements
of the Investors and any other restrictions on the right of such Investor to
sell his or its shares of Common Stock which shall be imposed by the managing
underwriter(s) for such offering (including, without limitation, the length of
the Holdback Period, and the other rights of such Investor to sell his or its
Registrable Securities), (ii) to negotiate with the Company and any third party
the terms and conditions of any agreements affecting the rights of such Investor
under this Agreement in connection with any other Liquidity Event and (iii) to
execute and deliver any and all documents, agreements and instruments and to
take any and all actions, in the name of and on behalf of such Investor, as may
be necessary or appropriate to effectuate the foregoing on such terms and
conditions as the Attorney approves in his sole judgment. No person to whom this
Power of Attorney is presented, as authority for Attorney to take any action or
actions contemplated hereby, shall be required to inquire into or seek
confirmation from the holder of Registrable Securities as to the authority of
Attorney to take any action or actions described above, or as to the existence
of or fulfillment of any condition to this Power of

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Attorney, which is intended to grant to Attorney
unconditionally the authority to take and perform the actions contemplated
herein, and each Investor irrevocably waives any right to commence any suit or
action, in law or equity, against any person or entity which acts in reliance
upon or acknowledges the authority granted under this Power of Attorney. The
Power of Attorney granted hereby is coupled with an interest, and may not be
revoked or canceled by an Investor without Attorney's written consent. The
Investor hereby ratifies, to the extent permitted by law, all that said Attorney
shall lawfully do or cause to be done by virtue hereof.

               
6.     Registration Procedures. If and whenever the
Company is required by the provisions hereof to use its best efforts to effect
the registration of any Registrable Securities under the Securities Act, the
Company will, as expeditiously as possible:

                       
(a)     subject to Sections 4 and 5(a), prepare and file
with the Commission a registration statement with respect to such securities
within 90 days after delivery of a Demand Notice under Section 2(b) or Section 4
hereof, and use its best efforts to cause any registration statement subject to
this Agreement to become effective not later than 90 days from the date of its
filing and to remain effective for the Requisite Period; 

                       
(b)     prepare and file with the Commission such amendments
and supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration statement
effective for the Requisite Period and comply with the provisions of the
Securities Act with respect to the disposition of all Registrable Securities
covered by such registration statement in accordance with the intended method of
disposition set forth in such registration statement for such period; 

                       
(c)     furnish to each seller of Registrable Securities and
to each underwriter such number of copies of the registration statement and the
prospectus included therein (including each preliminary prospectus) as such
persons reasonably may request in order to facilitate the intended disposition
of the Registrable Securities covered by such registration statement; 

                       
(d)     use its best efforts (i) to register or qualify the
Registrable Securities covered by such registration statement under the
securities or "blue sky" laws of such jurisdictions as the sellers of
Registrable Securities or, in the case of an underwritten public offering, the
managing underwriter reasonably shall request, (ii) to prepare and file in those
jurisdictions such amendments (including post effective amendments) and
supplements, and take such other actions, as may be necessary to maintain such
registration and qualification in effect at all times for the period of
distribution contemplated thereby and (iii) to take such further action as may
be necessary or advisable to enable the disposition of the Registrable
Securities in such jurisdictions, provided, that the Company shall not
for any such purpose be required to qualify generally to transact business as a
foreign corporation in any jurisdiction where it is not so qualified or to
consent to general service of process in any such jurisdiction; 

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(e)     use its best efforts to list the Registrable
Securities covered by such registration statement with any securities exchange
on which the Common Stock of the Company is then listed, or, if the Common Stock
is not then listed on a national securities exchange, use its best efforts to
list and facilitate the reporting of the Common Stock on The Nasdaq National
Market or SmallCap Market; 

                       
(f)     immediately notify each seller of Registrable
Securities and each underwriter under such registration statement, at any time
when a prospectus relating thereto is required to be delivered under the
Securities Act, of the happening of any event of which the Company has knowledge
as a result of which the prospectus contained in such registration statement, as
then in effect, includes any untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then existing
and promptly amend or supplement such registration statement to correct any such
untrue statement or omission; 

                       
(g)     notify each seller of Registrable Securities of the
issuance by the Commission of any stop order suspending the effectiveness of the
registration statement or the initiation of any proceedings for that purpose and
make every reasonable effort to prevent the issuance of any stop order and, if
any stop order is issued, obtain the lifting thereof at the earliest possible
time; 

                       
(h)     permit a single firm of counsel designated as
selling stockholders' counsel by the holders of a majority in interest of the
Registrable Securities and all other securities being registered ("Stockholders
Counsel") to review the registration statement and all amendments and
supplements thereto for a reasonable period of time prior to their filing (provided,
however, that in no event shall the Company be required to reimburse
legal fees in excess of $25,000 per registration statement pursuant to this
Section 6(h)) and the Company shall not file any document in a form to which
such counsel reasonably objects; 

                       
(i)     make generally available to its security holders as
soon as practicable, but not later than 90 days after the close of the period
covered thereby, an earnings statement (in form complying with the provisions of
Rule 158 under the Securities Act) covering a 12-month period beginning not
later than the first day of the Company's next fiscal quarter following the
effective date of the registration statement; 

                       
(j)     if the offering is an underwritten offering, the
Company will enter into a written agreement with the managing underwriter
selected in the manner herein provided in such form and containing such
provisions as are usual and customary in the securities business for such an
arrangement between such underwriter and companies of the Company's size and
investment stature, including, without limitation, customary holdback,
indemnification and contribution provisions; 

                       
(k)     if the offering is an underwritten offering, at the
request of any seller of Registrable Securities, use its best efforts to furnish
to such seller on the date that Registrable Securities are delivered to the
underwriters for sale pursuant to 

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such registration: (i) a copy of an opinion
dated such date of counsel representing the Company for the purposes of such
registration, addressed to the underwriters, stating that such registration
statement has become effective under the Securities Act and (A) that to the best
knowledge of such counsel, no stop order suspending the effectiveness thereof
has been issued and no proceedings for that purpose have been instituted or are
pending or contemplated under the Securities Act, (B) that the registration
statement, the related prospectus and each amendment or supplement thereof
comply as to form in all material respects with the requirements of the
Securities Act (except that such counsel need not express any opinion as to
financial statements or other financial or statistical information contained
therein) and (C) to such other effects as are customarily the subject of
opinions of issuer's counsel provided to underwriters in underwritten public
offerings and are reasonably requested by counsel for the underwriters and (ii)
to the extent available without unreasonable expense from the Company's
accounting firm, a copy of a letter dated such date from the independent public
accountants retained by the Company, addressed to the underwriters, stating that
they are independent public accountants within the meaning of the Securities Act
and that, in the opinion of such accountants, the financial statements of the
Company included in the registration statement or the prospectus, or any
amendment or supplement thereof, comply as to form in all material respects with
the applicable accounting requirements of the Securities Act, and such letter
shall additionally cover such other financial matters (including information as
to the period ending no more than five business days prior to the date of such
letter) with respect to such registration as such underwriters reasonably may
request; 

                       
(l)     make available for inspection by each seller of
Registrable Securities, any underwriter participating in any distribution
pursuant to such registration statement, and any attorney, accountant or other
agent retained by such seller or underwriter, all financial and other records,
pertinent corporate documents and properties of the Company, and cause the
Company's officers, directors and employees to supply all information reasonably
requested by any such seller, underwriter, attorney, accountant or agent in
connection with such registration statement; 

                       
(m)     provide a transfer agent and registrar, which may be
a single entity, for the Registrable Securities not later than the effective
date of the Registration Statement; 

                       
(n)     take all actions reasonably necessary to facilitate
the timely preparation and delivery of certificates (not bearing any legend
restricting the sale or transfer of such securities) representing the
Registrable Securities to be sold pursuant to the Registration Statement and to
enable such certificates to be in such denominations and registered in such
names as the Investors or any underwriters may reasonably request; and

                       
(o)     take all other reasonable actions necessary to
expedite and facilitate the registration of the Registrable Securities pursuant
to the Registration Statement; provided, however, that if the Company
shall furnish to the holders of Registrable Securities a certificate stating
that in the good faith judgment of the Board of Directors of the Company it
would be detrimental to the Company for a registration statement to be filed or
become effective in the near future, then the Company's 

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obligation to use its
best efforts to register, qualify or comply under Sections 2 and 4 shall be
deferred for a period not to exceed 90 days from the date of any registration
required under Sections 2 or 4, provided however, that this right
to defer its obligations under Sections 2 or 4 shall be exercised by the Company
not more than once in any 12 month period. 

                       
(p)     In connection with each registration subject to this
Agreement, the sellers of Registrable Securities will furnish to the Company in
a timely manner in writing such information with respect to themselves and the
proposed distribution by them as reasonably shall be necessary in order to
assure compliance with federal and applicable state securities laws.

               
7.     Expenses. All expenses incurred by the Company in
complying with Sections 2, 3 and 4, including, without limitation, all
registration and filing fees, printing expenses, fees and disbursements of
counsel and independent public accountants for the Company, fees and expenses
(including counsel fees) incurred in connection with complying with state
securities or "blue sky" laws, fees of the National Association of Securities
Dealers, Inc., fees of transfer agents and registrars, costs of insurance and
fees and disbursements of one counsel for the sellers of Registrable Securities
and all other securities being registered, but excluding any Selling Expenses,
are called "Registration Expenses." All underwriting discounts and
selling commissions applicable to the sale of Registrable Securities are called
"Selling Expenses."

               
The Company will pay all Registration Expenses in connection with each
registration statement filed hereunder. All Selling Expenses in connection with
each registration statement shall be borne by the participating sellers in
proportion to the number of Registrable Securities sold by each or as they may
otherwise agree.

               
8.     Indemnification and Contribution. (a) In the
event of a registration of any of the Registrable Securities under the
Securities Act pursuant to the terms of this Agreement, the Company will
indemnify and hold harmless and pay and reimburse each seller of such
Registrable Securities thereunder, each underwriter of Registrable Securities
thereunder and each other person, if any, who controls such seller or
underwriter within the meaning of the Securities Act, from and against, and pay
or reimburse them for, any losses, claims, expenses, damages or liabilities,
joint or several, to which such seller, underwriter or controlling person may
become subject under the Securities Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon (i) any untrue statement or alleged untrue statement of any
material fact contained in any registration statement under which such
Registrable Securities were registered under the Securities Act pursuant hereto,
any preliminary prospectus (unless superseded by a final prospectus) or final
prospectus contained therein, or any amendment or supplement thereof, or (ii)
the omission or alleged omission to state in any such registration statement a
material fact required to be stated therein or necessary to make the statements
therein not misleading or, with respect to any prospectus, necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, or (iii) any violation or alleged violation of the Securities
Act or any state securities or blue sky laws applicable to the Company and

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relating to action or inaction required by the Company in connection with the
offering of Registrable Securities and specifically will reimburse each such
seller, each underwriter and each such controlling person for any legal or other
expenses reasonably incurred by it in connection with investigating or defending
any such loss, claim, damage or liability (or action in respect thereof); 
provided, that the Company will not be liable in any such case if and to the
extent that any such loss, claim, damage or liability (or action in respect
thereof) arises out of or is based upon the Company's reliance on an untrue
statement or alleged untrue statement or omission or alleged omission so made in
conformity with information furnished by any such seller, any such underwriter
or any such controlling person in writing specifically for use in such
registration statement or prospectus; and provided, further, that
the Company shall not be liable in any such case to the extent that any such
loss, claim, damage or liability (or action in respect thereof) arises out of or
is based upon an untrue statement or alleged untrue statement or omission or
alleged omission in such registration statement or prospectus, which untrue
statement or alleged untrue statement or omission or alleged omission is
completely corrected in an amendment or supplement to the registration statement
or prospectus and such seller or such controlling person thereafter fails to
deliver or cause to be delivered such registration statement or prospectus as so
amended or supplemented prior to or concurrently with the Registrable Shares to
the person asserting such loss, claim, damage or liability (or action in respect
thereof) or expense after the Company has furnished such seller or such
controlling person with the same.

                       
(b)     In the event of a registration of any of the
Registrable Securities under the Securities Act pursuant hereto, each seller of
such Registrable Securities thereunder, severally and not jointly, will
indemnify and hold harmless the Company, each person, if any, who controls the
Company within the meaning of the Securities Act, each officer of the Company
who signs the registration statement, each director of the Company and each
underwriter and each person who controls any underwriter within the meaning of
the Securities Act from and against all losses, claims, expenses, damages or
liabilities, joint or several, to which the Company or such officer, director,
or controlling person may become subject under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based on any untrue statement or alleged untrue
statement of any material fact contained in the registration statement under
which such Registrable Securities were registered under the Securities Act
pursuant hereto, any preliminary prospectus or final prospectus contained
therein, or any amendment or supplement thereof, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
and will reimburse the Company and each such officer, director, underwriter and
controlling person for any legal or other expenses reasonably incurred by them
in connection with investigating or defending any such loss, claim, damage or
liability (or action in respect thereof); provided, that such seller will
be liable hereunder in any such case if and only to the extent that any such
loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
reliance upon and in conformity with information pertaining to such seller
furnished in writing to the Company by such seller specifically for use in such
registration statement or prospectus; and provided, further, that the
liability of each seller hereunder shall be limited to the proportion of any
such loss, claim, damage, liability or expense which is equal to the  

-11-

proportion
that the public offering price of the Registrable Securities sold by such seller
under such registration statement bears to the total public offering price of
all securities sold thereunder, but not in any event to exceed the proceeds
received by such seller from the sale of Registrable Securities covered by such
registration statement. Notwithstanding the foregoing, the indemnity provided in
this Section 8(b) shall not apply to amounts paid in settlement of any such
loss, claim, damage, liability or expense if such settlement is effected without
the consent of such indemnified party, which shall not be unreasonably withheld.

                       
(c)     Promptly after receipt by an indemnified party
hereunder of notice of the commencement of any action or claim, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party hereunder, notify the indemnifying party in writing thereof,
but the omission so to notify the indemnifying party shall not relieve it from
any liability which it may have to such indemnified party other than under this
Section 8 and shall only relieve it from any liability which it may have to such
indemnified party under this Section 8 if and to the extent the indemnifying
party is materially prejudiced by such omission. In case any such action shall
be brought against any indemnified party and it shall notify the indemnifying
party of the commencement thereof, the indemnifying party shall be entitled to
participate in and, to the extent it shall wish, to assume and undertake the
defense thereof with counsel satisfactory to such indemnified party, and, after
notice from the indemnifying party to such indemnified party of its election so
to assume and undertake the defense thereof, the indemnifying party shall not be
liable to such indemnified party under this Section 8 for any legal expenses
subsequently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation and of liaison with counsel
so selected; provided, that if the defendants in any such action include
both the indemnified party and the indemnifying party and the indemnified party
shall have reasonably concluded that there may be reasonable defenses available
to it which are different from or additional to those available to the
indemnifying party or if the interests of the indemnified party reasonably may
be deemed to conflict with the interests of the indemnifying party, the
indemnified party shall have the right to select a separate counsel and to
assume such legal defenses and otherwise to participate in the defense of such
action, with the expenses and fees of such separate counsel and other expenses
related to such participation to be reimbursed by the indemnifying party as
incurred. 

                       
(d)     In order to provide for just and equitable
contribution to joint liability under the Securities Act in any case in which
either (i) any holder of Registrable Securities exercising rights under this
Agreement, or any controlling person of any such holder, makes a claim for
indemnification pursuant to this Section 8 but it is judicially determined (by
the entry of a final judgment or decree by a court of competent jurisdiction and
the expiration of time to appeal or the denial of the last right of appeal) that
such indemnification may not be enforced in such case notwithstanding the fact
that this Section 8 provides for indemnification in such case, or (ii)
contribution under the Securities Act may be required on the part of any such
selling holder or any such controlling person in circumstances for which
indemnification is provided under this Section 8, then, and in each such case,
the Company and such holder will contribute to the aggregate losses, claims,
damages or liabilities to which they may be subject (after contribution from
others) in such 

-12-

proportion so that such holder is responsible for the portion
represented by the percentage that the public offering price of its Registrable
Securities offered by the registration statement bears to the public offering
price of all securities offered by such registration statement, and the Company
is responsible for the remaining portion; provided, that, in any such
case, (A) no such holder will be required to contribute any amount in excess of
the public offering price of all such Registrable Securities offered by it
pursuant to such registration statement and (B) no person or entity guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) will be entitled to contribution from any person or entity who
was not guilty of such fraudulent misrepresentation. 

               
9.     Changes in Capital Stock. If, and as often as,
there is any change in the capital stock of the Company by way of a stock split,
stock dividend, combination or reclassification, or through a merger,
consolidation, reorganization or recapitalization, or by any other means,
appropriate adjustment shall be made in the provisions hereof so that the rights
and privileges granted hereby shall continue with respect to the capital stock
as so changed.

               
10.     Rule 144 Reporting. With a view to making
available the benefits of certain rules and regulations of the Commission which
may at any time permit the sale of the Registrable Securities to the public
without registration, at all times after 90 days after any registration
statement covering a public offering of securities of the Company under the
Securities Act shall have become effective, the Company agrees to:

                            
(a)     make and keep public information available, as those
terms are understood and defined in Rule 144(c) under the Securities Act; 

                           
(b)     file with the Commission in a timely manner all
reports and other documents required of the Company under the Securities Act and
the Exchange Act; and

                           
(c)     furnish to each holder of Registrable Securities
forthwith upon request a written statement by the Company as to its compliance
with the reporting requirements of such Rule 144 and of the Securities Act and
the Exchange Act, a copy of the most recent annual or quarterly report of the
Company, and such other reports and documents so filed by the Company as such
holder may reasonably request in availing itself of any rule or regulation of
the Commission allowing such holder to sell any Registrable Securities without
registration.

                11.     Event of Election. In the event that the Company
fails to fulfill its registration responsibilities pursuant to Sections 2, 3 or
4 of this Agreement, the Stockholders shall have all rights and remedies
available to them at law or equity.

                12.     Representations and Warranties of the Company.
The Company represents and warrants to the Stockholders as follows:

                           
(a)     The execution, delivery and performance of this
Agreement by the Company have been duly authorized by all requisite corporate
action and will not violate any provision of law, any order of any court or
other agency of government, the 

-13-

charter or By-laws of the Company or any provision of any
indenture, agreement or other instrument to which it or any or its properties or
assets is bound, conflict with, result in a breach of or constitute (with due
notice or lapse of time or both) a default under any such indenture, agreement
or other instrument or result in the creation or imposition of any lien, charge
or encumbrance of any nature whatsoever upon any of the properties or assets of
the Company or its subsidiaries.

                           
(b)     This Agreement has been duly executed and delivered
by the Company and constitutes the legal, valid and binding obligation of the
Company, enforceable in accordance with its terms.

                13.    
Assignment of Registration Rights. The rights to cause or have the Company
register Registrable Securities pursuant to this Agreement may be assigned by
the Stockholders to transferees or assignees of such securities; provided,
that the Company is, within reasonable time after such transfer, furnished with
written notice of the name and address of such transferee or assignee and the
securities with respect to which such registration rights are being assigned.
The term "Investors" as used in this Agreement shall include such
transferees or permitted assignees.

                14.    
Agreement Terminates and Supercedes Prior Registration Rights. This
Agreement terminates and supercedes all prior rights of the Investors for the
registration of Common Stock under the Securities Act and state securities laws
under all agreements between the Company and any of the Investors. Except with
respect to registration rights under the Securities Act and state securities
laws and with respect to the matters specifically provided for in this
Agreement, any agreements between the Company and any of the Investors are not
affected by this Agreement.

                15.    
Miscellaneous.

                           
(a)     All covenants and agreements contained in this
Agreement by or on behalf of any of the parties hereto shall bind and inure to
the benefit of the respective successors and assigns of the parties hereto
(including without limitation transferees of any Registrable Securities),
whether so expressed or not.

                           
(b)     All notices, requests, consents and other
communications hereunder shall be in writing and shall be delivered in person,
mailed by certified or registered mail, return receipt requested, or sent by
telecopier or telex, addressed (i) if to the Company, at Minrad Inc., 847 Main
Street, Buffalo, New York 14203, facsimile: (716) 855-1068, Attention: William
H. Burns, Jr.; (ii) if to Investors, at the address of such party as set forth
beneath such party's signature to the Omnibus Signature Page (in the case of
Investors in the offering under the Memorandum) or as set forth in the records
of the Company (in the case of existing holders of Company securities); (iii) if
to the Placement Agent, at Cagan McAfee Capital Partners, LLC, 10600 N. De Anza
Blvd., Suite 250, Cupertino, CA 95104, facsimile: (408)
873-0550, Attention: Laird Cagan; and (iv) if to any subsequent holder of
Registrable Securities, to it at such address as may have been furnished to the
Company in writing by such holder; or, in any case, at such other address or
addresses as shall have been furnished in writing to the Company (in the case of
a holder 

-14-

of Registrable Securities) or to the holders of Registrable Securities
(in the case of the Company) in accordance with the provisions of this
paragraph. 

                           
(c)     This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware applicable to contracts
entered into and to be performed wholly within said State.

                           
(d)     Any judicial proceeding brought against any of the
parties to this Agreement on any dispute arising out of this Agreement or any
matter related hereto shall be brought in the courts of the State of New York
and County of New York or in the United States District Court for the Southern
District of New York, and, by execution and delivery of this Agreement, each of
the parties hereto accepts for itself and himself the process in any such action
or proceeding by the mailing of copies of such process to it or him, at its or
his address as set forth in paragraph 15(b) and irrevocably agrees to be bound
by any judgment rendered thereby in connection with this Agreement. Each party
hereto irrevocably waives to the fullest extent permitted by law any objection
that it or he may now or hereafter have to the laying of the venue of any
judicial proceeding brought in such courts and any claim that any such judicial
proceeding has been brought in an inconvenient forum. The foregoing consent to
jurisdiction shall not constitute general consent to service of process in the
State of New York for any purpose except as provided about and shall not be
deemed to confer rights on any person other than the respective parties to this
Agreement.

                       
(e)     This Agreement may not be amended or modified
without the written consent of the Company, and the holders of at least a
majority of the Registrable Securities.

                       
(f)     Failure of any party to exercise any right or remedy
under this Agreement or otherwise, or delay by a party in exercising such right
or remedy, shall not operate as a waiver thereof. No waiver shall be effective
unless and until it is in writing and signed by the party granting the waiver.

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

                       
(h)     The Company shall not grant to any third party other
than the Placement Agent any registration rights more favorable than or
inconsistent with any of those contained herein, so long as any of the
registration rights under this Agreement remains in effect.

                       
(i)     If any provision of this Agreement shall be held to
be illegal, invalid or unenforceable, such illegality, invalidity or
unenforceability shall attach only to such provision and shall not in any manner
affect or render illegal, invalid or unenforceable any other provision of this
Agreement, and this Agreement shall be carried out as if any such illegal,
invalid or unenforceable provision were not contained herein.

-15-

                16.    
Omnibus Signature Page. In the case of Investors acquiring Shares in the
offering described in the Memorandum, this Agreement is intended to be read and
construed in conjunction with a Subscription Agreement of even date herewith
pertaining to the issuance by the Company of the shares of Common Stock to
subscribers pursuant to the Memorandum. Accordingly, pursuant to the terms and
conditions of this Agreement and such related agreements it is hereby agreed
that the execution by Investors of the Subscription Agreement, in the place set
forth therein, shall constitute their agreement to be bound by the terms and
conditions hereof and the terms and conditions of the Subscription Agreement,
with the same effect as if each of such separate but related agreement were
separately signed.

[next page is the signature page]

-16-

                IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date first written above.

	 	MINRAD INC.
	 	 
	 	By: 	 /s/ William
    H. Burns, Jr.
	 		William H. Burns, Jr., Chairman and
	 		Chief Executive Officer

Investors who are not acquiring Shares

in the Offering under the Memorandum:

SPENCER TRASK SPECIALTY GROUP, LLC 

By: ______________________________

Donald Farley

Title: Chief Executive Officer

NAME: Donald F. Farley 

Signature: ________________________ 

                Donald F. Farley

SPENCER TRASK HOLDINGS, INC. 

By: _____________________________

Name:

Title:

SPENCER TRASK & COMPANY

By: _____________________________

Name:

Title:

LINCOLN ASSOCIATES LLC

By:________________________

Name: William P. Dioguardi

Title: 

[Continued on next page]

-17-

KEVIN KIMBERLIN, LTD.

By: ______________________________

Name: Kevin Kimberlin

Title:__________________

NAME: William P. Dioguardi 

Signature: _______________________

                William P. Dioguardi

SPENCER TRASK SECURITIES, INCORPORATED

By: _____________________________

Name:

Title:

SPENCER TRASK PRIVATE EQUITY FUND, I

By: _____________________________

Name:

Title:

SPENCER TRASK PRIVATE EQUITY FUND, II

By: ______________________________

Name:

Title:

NEW ENGLAND PARTNERS CAPITAL, L.P.

By: NEP Capital, LLC, Its General Partner

By: _____________________________

Name: John Rousseau

Title: Principal

See Omnibus Signature Page for Signatures

Of Investors acquiring shares in the 

Offering under the Memorandum

-18-Exhibit 10.1

Exhibit 10.1

EMPLOYMENT AGREEMENT

THIS AGREEMENT is made as of the 1st day of March, 2004
by and between Minrad Inc., a Delaware corporation, with an office at 847 Main
Street, Buffalo, NY 14203 (the "Corporation") and William H. Burns, Jr. residing
at 69 Forest Road, Orchard Park, NY 14127 (the "Executive"). 

Introductory Statement. The Executive has been
employed as President of the Corporation and also served as a Director of
Corporation for many years. During the course of his employment, the Executive
has become experienced in the business of the Corporation, including its trade
secrets, customers, market areas, sources of supply and manner of doing
business. Therefore, the Corporation desires to continue to employ the Executive
as President of the Corporation, and elect the executive as a member of the
Board of Directors, and the Executive desires to accept continued employment,
upon the terms and conditions contained in this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants
and agreements contained in this Agreement the parties agree as follows: 

1.0 Term of Employment. Subject to the
terms and conditions set forth in this Agreement, the Corporation shall employ
the Executive as President and Chief Executive Officer of the Corporation for
the period beginning on the date of this Agreement and continuing until April
30, 2007 or until earlier terminated as provided in this Agreement.

2.0 Duties. Subject to the terms and
conditions set forth in this Agreement, the Executive shall serve as Chief
Executive Officer of the Corporation and as President, until such time the Board
of Directors shall appoint a President, who shall report to the Chief Executive
Officer, be in full charge of the operation of its business and affairs, subject
to the provisions of the by-laws of the Corporation in respect of the duties and
responsibilities assigned by the Board of Directors to the Chief Executive
Officer, and subject also at all times to the control of the Board of Directors.
The Executive shall perform such duties and discharge such responsibilities as
are commensurate with his position, and as the Board of Directors shall from
time to time reasonably direct executive nature and scope of the Executive's
employment. 

The Executive shall perform his duties and discharge his
responsibilities in a faithful manner and to the best of his ability. Unless
otherwise agreed upon by the Corporation and the Executive, the Executive shall
devote substantially all of his business time and attention to the performance
of the duties called for by this Agreement. The Executive shall not serve as a
director or manager of any other business corporation or entity without the
prior written consent of the Board of Directors of the Corporation. 

The Board of Directors of the Corporation reserves the right
from time to time to assign to the Executive additional duties and
responsibilities and to delegate to other executives of the Corporation duties
and responsibilities normally discharged by the Executive subject to the
Executive's supervision as Chief Executive Officer. 

3.0 Compensation. So long as the
Executive is employed by the Corporation:

3.1 The Executive shall receive an annual base salary
of $200,000 payable bi-weekly

3.2 The Executive shall be entitled to an annual bonus
for each fiscal year of the Corporation during which the Executive is employed
and, subject to Articles 6.0, 7.0 and 7.1-7.5 hereof, any part thereof,
determined as follows:

(a) The Corporation's gross profit after distribution
expenses will be determined for each fiscal year as herein provided (the "Net
Profit Amount"); and

The Executive shall be entitled to one percent (1%) of the
portion of the Net Profit Amount for each fiscal year (the "Bonus Year") up to
the amount of the Net Profit Amount for the prior year plus two and
one-half percent (2.5%) of the amount by which the Net Profit Amount for each
Bonus Year exceeds the Net Profit Amount for the prior year; provided, however,
that the maximum amount of any bonus that can be earned under this Section 3.2
is $400,000. The bonus is to be payable on an annual basis, based on the
Corporation's audited financial statements. Such bonus shall be paid as soon as
practicable after the Corporation's audited financial statements have been
completed.

3.3 The Corporation shall deduct or withhold from all
payments made to the Executive pursuant to this Agreement all amounts which may
be required to be deducted or withheld under any applicable law now in effect or
which may become effective during the term of this Agreement (including but not
limited to Social Security contributions and income tax withholdings). 

3.4 The Executive shall be entitled to participate in
the qualified retirement plan or plans, if any, adopted by the Board of
Directors of the Corporation for the executive officers of the Corporation as
such plan or plans may be amended from time to time. 

3.5 The Executive shall receive the various other
fringe benefits, if any, provided for the executive officers of the Corporation
that may be authorized from time to time by the Board of Directors of the
Corporation in its sole discretion. Without limiting the foregoing, the
Corporation shall pay or reimburse the Executive for the dues of one country
club in Western New York.

3.6 The Executive may be entitled to receive increases
in compensation. The determination of the amount of such bonus and increases in
compensation, if any, and the time and method of payment of such increases shall
be vested in the sole discretion of the Board of Directors of the Corporation.

3.7 Vacations. The Executive shall be entitled
to take four (4) weeks of vacation per year on a non-cumulative basis. 

4.0 Stock Options. The Executive shall
be granted stock options to purchase commons stock of the Corporation ("New
Options") that, when added to the Executive's currently vested options, shall
result in the Executive having options to purchase a total 3% of the
Corporation's common stock (shares of stock or stock equivalents) as provided
for below. Such New Options shall vest at the rate of 1/36 per month for each
month that Executive is employed according to the terms and conditions of this
Employment Agreement. Accordingly, the Corporation shall (i) grant 285,000
options subject to the vesting provided for above and (ii) grant 180,000 options
provided that, by December 31, 2004, the Company shall have sold $2.7 Million in
equity after November 1, 2004 and, further provided that if the company sells
less than $2.7 Million in new equity in such period, 180,000 options shall be
reduced proportionately.

The Executive shall also be eligible for stock options
equivalent to an additional 2% of the Corporation's issued shares of common
stock as provided for on Enclosure 1 ("Additional Options"), subject to the
achievement of milestones recommended by the Compensation Committee of the
Board. Such milestones are defined in Enclosure 1. The milestones must be
achieved during the term of this Employment Agreement. Upon agreement by the
Compensation Committee of the Board that achievement has been reached, the
Additional Options shall be awarded and shall be fully vested. For purposes of
defining issued shares of common stock, etc., such calculation shall be based on
the Company's 2004 financing target resulting in a capitalization of 42 million
shares of stock.

Strike prices and exercise periods for the Executive's New
Options and any Additional Options shall be consistent with awards made
according to the administration of the Corporation's incentive stock option
plan. 

Issuance of the options shall be in accordance with all
applicable securities laws and the other terms and conditions of a Stock Option
Agreement form to be adopted by the Company's Board of Directors at the time of
the first vesting under this provision.

Notwithstanding any language in this Agreement to the
contrary, in any event where there is a transaction which results in a merger of
the Company into another Company such that it is not the surviving entity or a
transaction in which there is a change of control of the Company such that there
is a new single majority share-holder, all of the options available under
Section 4.0 of this Agreement shall immediately vest in Executive and be
available for exercise by Executive.

5.0 Reimbursement for Expenses. The
Corporation shall reimburse the Executive for expenses which the Executive may
from time to time reasonably incur on behalf of and at the request of the
Corporation in the performance of his responsibilities and duties under this
Agreement, provided that the Executive shall be required to account to the
Corporation for such expenses in the manner prescribed by the Corporation.

6.0 Termination of Employment by Reason of Death.
If the Executive shall die during the term of this Agreement, this Agreement
shall terminate automatically as of the date of his death, and the Corporation
shall pay to the Executive's legal representatives the sum of the salary which
would otherwise be payable to the Executive up to the end of the month in which
his death occurs plus (a) a prorated portion of any bonus payable under Section
3.2, or otherwise approved by the board of directors of the Corporation, for the
fiscal year in which termination occurs and not yet paid (determined by
multiplying the bonus for the fiscal year in which termination occurs by a
fraction, the numerator of which is the number of whole or partial months in
such fiscal year during which this Agreement was in effect and the denominator
of which is twelve (12), and (b) all other benefits and reimbursable expenses
accrued and owing to the Executive with respect to his employment prior to such
termination (the amounts provided for in clauses (a) and (b) being the "Accrued
Obligations"). All vested stock options shall be transferred to the Executive's
legal representatives.

7.0 Termination of Employment by Reason of
Disability. If the Executive shall become temporarily disabled during
the term of this Agreement, all of the Executive's rights under this Agreement
shall continue until such time as the Executive either returns to work or is
deemed "permanently disabled" (as hereinafter defined in Section 7.2). 

7.1 If the Executive shall be deemed permanently
disabled, the Executive's employment shall automatically terminate at the end of
the month in which it is determined that the Executive has a permanent
disability. Upon such termination, the Corporation shall pay the Executive (or
his legal representatives) as if the Executive were terminated by Reason of
Death. During the period of permanent disability the Executive shall be entitled
to receive any benefits payable under the Corporation's disability insurance
program.

7.2 The Executive shall be deemed permanently disabled
for purposes of this Agreement if:

(a) in the opinion of the Board of Directors, the
Executive is unable to render full-time service to the Corporation pursuant to
the terms of this Agreement for six consecutive months; or 

(b) in the opinion of the Board of Directors, the
Executive is unable to render full-time service to the Corporation pursuant to
the terms of this Agreement for nine months out of any twelve consecutive month
period; or

(c) in the opinion of the Corporation's Medical
Director or, if there is no Medical Director at such time, a physician mutually
selected by the Corporation and the Executive or selected in accordance with the
provisions of this Section 7.2, the Executive is permanently unable to render
full-time service to the Corporation under this Agreement. 

If the Corporation and the Executive are unable to mutually
agree upon the selection of a physician under "(c)" above within 30 days of
either party requesting the other to so agree, each party shall select a
physician and the two physicians so selected shall promptly select a third
physician who shall make such determination. 

7.3 Termination of Employment for Cause.
The Corporation may immediately terminate the Executive's employment in the
event that the Executive shall do or cause to be done any act which constitutes
"cause" (as hereinafter defined) for termination. For purposes of this
Agreement, cause shall be deemed to mean a material breach by the Executive of
this Agreement, gross negligence or willful misconduct in the performance of his
duties, dishonesty to the Corporation (conviction of a crime in any court which
could have the effect of causing the termination or suspension of any license
which the Corporation holds), conviction of a felony or excessive absenteeism
not related to disability. If the Executive's employment is terminated by the
Corporation for cause, the Corporation's only obligation shall be to pay the
Executive his salary under Article 3.0 of this Agreement plus any reimbursable
expenses that have not been paid as of the date of such termination. Nothing
contained in this Article 7.0 shall in any way waive, restrict or prejudice the
Corporation's rights and remedies in equity and at law against the Executive
with respect to the matter for which the Executive's employment under this
Agreement is terminated for cause. All vested but unexercised and unvested stock
options shall be voided and returned to the Corporation. 

7.4 Termination Without Cause. The
Corporation may terminate the Executive without cause. If the Executive's
employment is terminated by the Corporation without cause, the Corporation shall
pay the Executive the sum of (a) his salary for the remainder of the term of
this Agreement or one year, whichever is shorter, plus (b) any Accrued
Obligations. The non-milestone stock options shall be automatically vested.

7.5 Accrued Obligations. All Accrued
Obligations to be paid under this Article 7.0 shall be payable within 30 days
after they are determinable.

8.0 Confidentiality. During the course
of his employment as an executive officer of the Corporation, the Executive has
had and will have access to and will gain knowledge with respect to all of the
lines of business of the Corporation, including product information, information
concerning customers, brokers, suppliers and other valuable information relating
to the development, manufacture, storage, shipment, marketing and sale of
products of the Corporation ("Confidential Information"). The parties also agree
that covenants by the Executive not to make unauthorized disclosures of the
Confidential Information and not to use the Confidential Information after the
termination of the Executive's employment with the Corporation in a business in
competition with that of the Corporation are essential to the growth and
stability of the business of the Corporation. Accordingly, Executive agrees
that, except as required by his duties under this Agreement, he or she shall not
use or disclose to anyone at anytime during or after the term of this Agreement
any Confidential Information obtained by him or her in the course of his
employment with the Corporation. 

9.0 Non-Competition.

9.1 During the term of this Agreement and for a period
of 12 months after the date of the termination of this Agreement, the Executive
agrees that he shall not directly or indirectly, for his own account or as
agent, officer, director, trustee, consultant or shareholder of any corporation
or a member of any firm or otherwise, anywhere in the United States engage or
attempt to engage in any business activity which is the same as, substantially
similar to or directly competitive with (a) the type of business of the
Corporation in designing, developing and producing products intended to minimize
radiation exposure and enhance surgical accuracy in fluoroscopically assisted
medical procedures, (b) the Corporation's generic inhalation pharmaceutical
business involving enflurane, isoflurane or sevoflurane or related products
and/or (c) the Corporation's conscious sedation business.

9.2 During the term of this Agreement and for a period
of 12 months from the date of termination of this Agreement, the Executive
agrees that he or she shall not, directly or indirectly, for his own account or
as agent, employee, officer, director, trustee, consultant or shareholder of any
corporation, or member of any firm or otherwise, employ or solicit the
employment of any employee of the Corporation. 

9.3 It is acknowledged and agreed by the Corporation
that the Executive's ownership of shares of a company which competes with the
business of the Corporation shall not violate this Article 9.0 unless (a) the
Executive also participates in the management of such company as an officer,
director or consultant or (b) the Executive owns a controlling interest in such
company.

9.4 The Executive acknowledges and agrees that the
foregoing territorial and time limitations and restrictive covenants are
reasonable and properly required for the adequate protection of the business and
affairs of the Corporation, and in the event any such territorial or time
limitation is found to be unreasonable by a court of competent jurisdiction, the
Executive agrees and submits to the reduction of either said territorial or time
limitation or both, to such an area or period as the court may determine to be
reasonable. 

10.0 Rights to Discoveries.

10.1 Subject to Section 10.2 hereof, the Executive
agrees that all ideas, inventions, trademarks and other developments or
improvements conceived, developed or acquired by the Executive, whether or not
during working hours, at the premises of the Corporation or elsewhere, alone or
with others, that are within the scope of the Corporation's business operations
or that relate to any work or projects of the Corporation ("Inventions") shall
be the sole and exclusive property of the Corporation. The Executive agrees to
disclose promptly and fully to the Corporation all such Inventions, trademarks
or other developments and, at the request of the Corporation, the Executive
shall submit to the Corporation a full written report thereof regardless of
whether the request for a written report is made after the termination of this
Agreement. The Executive agrees that during the term of this Agreement and for 6
months thereafter, upon the request of the Corporation and at its expense, he
shall execute and deliver any and all applications, assignments and other
instruments which the Corporation shall deem necessary or advisable to transfer
to and vest in the Corporation the Executive's entire right, title and interest
in and to all such Inventions, trademarks or other developments and to apply for
and to obtain patents or copyrights for any such patentable or copyrightable
ideas, inventions, trademarks and other developments. 

10.2 The Corporation and the Executive agree that notwithstanding the
provisions of Section 10.1, the Executive shall have the rights under the
Corporation's Patent and Invention Policy, including but not limited to the
rights to any royalty payable thereunder, with respect to Inventions conceived,
developed or acquired prior to the date of this Agreement but not with respect
to any Inventions that were conceived, developed or acquired by the Executive
both (a) after the date of this Agreement and (b) while Executive was Chief
Executive Officer of the Company.

11.0 Insurance. The Executive agrees
that the Corporation, in its sole discretion, may apply for insurance coverage
to be owned by it and for its benefit covering the Executive in any amounts
deemed advisable by the Corporation, and the Executive waives any right, title
or interest therein. The Executive agrees to submit to all required examinations
and to execute, assign and deliver all applications and other documents
necessary to effectuate such insurance coverage. 

The Executive shall have the right to purchase from the
Corporation, within 30 days after termination of this Agreement, all such
policies of insurance covering him or her, at a price equal to the cash value of
such policies, plus the unearned portion of any premiums, on the date of such
termination. For purposes of this Article 11.0, "cash value" shall mean the net
cash amount, after adjustment for credits and debits, at which such policies
could be surrendered by the Corporation on the date of such termination. Upon
receipt of the purchase price, the Corporation shall deliver such policies to
the Executive and shall execute all necessary instruments of transfer. The
Executive shall have no further rights in any such policies not so purchased
within such 30-day period.

12.0 Notices. All notices and other
communications given pursuant to this Agreement shall be deemed to have been
properly given or delivered if mailed, by certified mail, postage prepaid,
addressed to the appropriate party, at the address for such party set forth at
the beginning of this Agreement. Any party may from time to time designate by
written notice given pursuant to this Article 12.0 any other address or party to
which any such notice or communication or copies thereof shall be sent.

13.0 Equitable Relief. The Executive
acknowledges that the Corporation will suffer damages incapable of ascertainment
in the event that any of the provisions of Article 8.0, 9.0 or 10.0 hereof are
breached and that the Corporation will be irreparably damaged in the event that
the provisions of Articles 8.0, 9.0 and 10.0 are not enforced. Therefore, should
any dispute arise with respect to the breach or threatened breach of Articles
8.0, 9.0 or 10.0 of this Agreement, the Executive agrees and consents, that in
addition to any and all other remedies available to the Corporation, an
injunction or restraining order or other equitable relief may be issued or
ordered by a court of competent jurisdiction restraining any breach or
threatened breach of Articles 8.0, 9.0 or 10.0 of this Agreement. The Executive
agrees not to urge in any such action that an adequate remedy exists at law. All
expenses, including, without limitation, attorney's fees and expenses incurred
in connection with any legal proceeding arising as a result of a breach or
threatened breach of Articles 8.0, 9.0 or 10.0 of this Agreement shall be borne
by the losing party to the fullest extent permitted by law and the losing party
hereby agrees to indemnify and hold the other party harmless from and against
all such expenses. 

14.0 Miscellaneous. This Agreement shall
be governed by the internal domestic laws of the State of New York without
reference to conflict of laws principles. This Agreement shall be binding upon
and inure to the benefit of the legal representatives, successors and assigns of
the parties hereto (provided, however, that the Executive shall not have the
right to assign this Agreement in view of its personal nature). All headings and
subheadings are for convenience only and are not of substantive effect. This
Agreement constitutes the entire agreement between the parties hereto with
respect to the subject matter hereof and supersedes all prior negotiations,
understandings and writings (or any part thereof) whether oral or written
between the parties hereto relating to the subject matter hereof. There are no
oral agreements in connection with this Agreement. Neither this Agreement nor
any provision of this Agreement may be waived, modified or amended orally or by
any course of conduct but only by an agreement in writing duly executed by both
of the parties hereto. If any article, section, portion, subsection or
subportion of this Agreement shall be determined to be unenforceable or invalid,
then such article, section, portion, subsection or subportion shall be modified
in the letter and spirit of this Agreement to the extent permitted by applicable
law so as to be rendered valid and any such determination shall not affect the
remainder of this Agreement, which shall be and remain binding and effective as
against all parties hereto.

15.0 Arbitration. The Executive and the
Corporation agree that, except as contemplated by Article 13.0 for any action or
proceeding to enforce Articles 8.0, 9.0 and 10.0 hereof, any dispute or
controversy arising out of, relating to, or in connection with this Agreement or
the termination thereof, or the interpretation, validity, construction,
performance, breach, or termination thereof, shall be settled by expedited,
binding arbitration to be held in Buffalo, New York in accordance with the
National Rules for the Resolution of Employment Disputes then in effect of the
American Arbitration Association (the "Rules"). The arbitrator may grant
injunctions or other relief in such dispute or controversy. The decision of the
arbitrator shall be final, conclusive and binding on the parties to the
arbitration. Judgment may be entered on the arbitrator's decision in any court
having jurisdiction.

The arbitrator(s) shall apply New York law to the merits of
any dispute or claim, without reference to rules of conflicts of law. The
arbitration proceedings shall be governed by federal arbitration law and by the
Rules, without reference to state arbitration law.

THE EXECUTIVE HAS READ AND UNDERSTANDS THIS SECTION, WHICH
DISCUSSES ARBITRATION. EXECUTIVE UNDERSTANDS THAT BY SIGNING THIS AGREEMENT,
EXECUTIVE IS AGREEING TO SUBMIT ANY CLAIMS ARISING OUT OF, RELATING TO, OR IN
CONNECTION WITH THIS AGREEMENT, OR THE INTERPRETATION, VALIDITY, CONSTRUCTION,
PERFORMANCE, BREACH OF TERMINATION THEREOF, TO BINDING ARBITRATION, AND THAT
THIS ARBITRATION CLAUSE CONSTITUTES A WAIVER OF EXECUTIVE'S RIGHT TO A JURY
TRIAL AND RELATES TO THE RESOLUTION OF ALL DISPUTES RELATING OT ALL ASPECTS OF
THE EMPLOYER/EMPLOYEE RELATIONSHIP, INCLUDING BUT NOT LIMITED TO, STATUTORY
DISCRIMINATION CLAIMS.

[SIGNATURE PAGE FOLLOWS]

 

IN WITNESS WHEREOF, the parties hereto have duly executed
this Agreement as of the date first above written. 

	 	/s/
    William H. Burns, Jr.
	 	
    William H. Burns, Jr. (Executive)

	 	
    

	 	
     

	 	
    MINRAD INC.

	 	
    

	 	By	/s/ Donald Farley
	 	 	
    Donald Farley, Director and

	 	 	
    Chairman of Compensation Committee

Enclosure 1

William Burns Employment Agreement

Stock Option Incentives

	 	
    Ratio
	
    Capitalization
	
    Max Option

	 	 	 	 
	Total Value	2%	
    42,250,000
	
    845,000

	 	 	 	 
	 	 	 	 
	 	Milestone	
    Value
	
    Amount of Shares Awarded

	 	 	 	 
	Quarterly Revenue	$ 5 Million	
    10%
	
    84,500

	 	$10 Million	
    15%
	
    126,750

	 	$15 Million	
    25%
	
    211,250

	 	Total	 	
    50%
	
    422,500

	 	 	 	 
	Projected Milestones	 	 	 
	 	 	 	 
	SabreSource	500 US Placements Achieved	25%	
    211,250

	Conscious Sedation	NDA Application Accepted for Review
    by the US FDA	25%	
    211,250

	 	 	 	
    422,500

	 	Maximum Total Award	 	
    845,000

 

 

 

 

Note - Failure of Company to achieve 42 million shares of equity by
12/31/04, shall result in appropriate reduction of shares awarded for milestone
options.

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