Document:

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                                                                   EXHIBIT 10.29

                     MASTER NOTE (EURODOLLAR/PRIME RATE)(1)

$10,000,000                                                 DATE:         , 2004

         FOR VALUE RECEIVED, the undersigned, a Michigan corporation, promises
to pay to the order of CITIBANK, F.S.B. (the "Bank"), on or before March 15,
2005 (the "Maturity Date"), the sum of Ten Million Dollars ($10,000,000), or, if
less, the aggregate unpaid principal amount of all advances made by the Bank
pursuant to the line of credit (each an "Advance" and collectively, the
"Advances"), not to exceed an aggregate amount at any one time outstanding of
Ten Million Dollars ($10,000,000), available to the undersigned hereunder (the
"Line") together with interest thereon as set forth herein.

         Each Advance hereunder which is a Eurodollar Advance (as defined below)
shall bear interest on the unpaid principal amount thereof for the Interest
Period applicable thereto at a rate per annum equal to the Reserve Adjusted
Libor determined for each Interest Period therefor in accordance with the terms
of this Note plus a margin of 100 basis points. Each Advance which is a Prime
Rate Advance (as defined below) shall bear interest on the unpaid principal
amount thereof from the date thereof until payment of such Prime Rate Advance in
full at a fluctuating rate per annum equal to the Prime Rate plus a margin of 0%
per annum. The undersigned shall notify the Bank not later than 12 noon three
Business Days prior each Advance hereunder which the undersigned requests to
maintain at a rate of interest based on Reserve Adjusted Libor (a "Eurodollar
Advance"), and not later than 12 noon on the date of each Advance which the
undersigned requests to maintain at a rate of interest based on the Prime Rate
(a "Prime Rate Advance"). All requests for Advances shall be irrevocable and
shall be in the minimum amount of $100,000. Each request by the undersigned for
an Advance hereunder shall specify whether the requested Advance is a Eurodollar
Advance or a Prime Rate Advance, the proposed date to fund the Advance, and if a
Eurodollar Advance is requested, the Interest Period applicable thereto.

         Any Eurodollar Advance may be continued as a Eurodollar Advance upon
expiration of an Interest Period with respect thereto by complying with the
notice provisions contained in the definition of Interest Period; provided,
however, that no Eurodollar Advance may be continued as such when any Event of
Default or event which upon notice, passage of time or both would constitute an
Event of Default has occurred and is continuing but shall be automatically
converted to a Prime Rate Advance on the last date of the Interest Period in
effect when the Bank is notified of such default or Event of Default.

         The undersigned may elect from time to time to convert outstanding
Eurodollar Advances to Prime Rate Advances by giving the Bank at least three
Business Days prior irrevocable notice of such election; provided that any
conversion of a Eurodollar Advance may be made only on the last day of an
Interest Period with respect thereto. The undersigned may elect from time to
time to convert an outstanding Prime Rate Advance to Eurodollar Advance by
giving the Bank irrevocable written notice of such election not later than 12
noon, three Business Days prior to the date of the proposed conversion and
further provided that (i) the conversion shall be in the minimum principal
amount of $100,000 and (ii) no Event of Default or event upon notice, passage of
time or both would constitute an Event of Default shall have occurred and be
continuing. Notwithstanding the foregoing, no Advance may be converted to or
continued as a Eurodollar Advance if the Interest Period would extend beyond the
Maturity Date.

_______________________

(1) This note provides that interest be paid monthly in respect of Prime
       Rate Advances and on the last day of an Interest Period in respect of
       Eurodollar Advances.

<PAGE>

         Interest in respect of Prime Rate Advances shall be payable on the
first day of each month commencing on the first such date to occur after the
date the Advance is made, and on the Maturity Date. Interest in respect of
Eurodollar Advances shall be payable on the last day of the Interest Period in
respect thereof. Interest shall be calculated on the basis of a 360-day year for
the actual number of days elapsed. All payments hereunder shall be payable in
immediately available funds in lawful money of the United States. The
undersigned authorizes the Bank to charge any of the undersigned's accounts for
payments of principal or interest. Any payment of principal of or interest
payable hereunder which is not paid when due, whether at maturity, by
acceleration, or otherwise, shall bear interest from the date due until paid in
full at a rate per annum equal to three percent (3%) above the rate otherwise
payable with respect thereto.

         All requests for advances shall be irrevocable and shall be for a
minimum of $100,000 and must be received by the Bank no later than 12:00 noon on
the date of the proposed advance. The Bank may act without liability upon the
basis of telephonic notice believed by the Bank in good faith be from the
undersigned. In each such case, the undersigned hereby waives the right to
dispute the Bank's record of the terms of such telephonic notice. The
undersigned shall immediately confirm to the Bank in writing each telephonic
notice. All advances under the Line are at the Bank's sole and absolute
discretion and the Bank, at its option and in its sole and absolute discretion
and without notice to the undersigned may decline to make any advance requested
by the undersigned.

         Subject to the terms and conditions hereof and the terms and conditions
set forth in any agreement in writing between the Bank and the undersigned the
undersigned may borrow, repay in whole or in part, and reborrow on a revolving
basis, up to the maximum amount of the Line. Prime Rate Advances may be prepaid
without premium or penalty together with accrued interest thereon to and
including the date of prepayment. Eurodollar Advances may be prepaid without
premium or penalty (except as provided in the next succeeding paragraph)
together with accrued interest thereon to and including the date of prepayment,
provided such prepayment date must be the last day of the then current Interest
Period of such Advance. The Bank shall maintain its records to reflect the
amount and date of each advance and of each payment of principal and interest
thereon. A such records shall, absent manifest error, be conclusive as to the
outstanding principal amount hereof; provided, however, that the failure to make
any notation to the Bank's records shall not limit or otherwise affect the
obligations of the undersigned to repay each advance made by the Bank, in
accordance with the terms hereof.

         The undersigned agrees to indemnify the Bank and hold the Bank harmless
from any loss or expense which the Bank may sustain or incur, including without
limitation, interest or fees payable by the Bank to lenders of funds obtained by
it in order to maintain a Eurodollar Advance hereunder, as a consequence of (a)
default by the undersigned in payment of the principal amount of or interest on
a Eurodollar Advance, (b) default by the undersigned in making any prepayment of
a Eurodollar Advance after the undersigned gives notice in accordance with this
Note and/or (c) the making of any payment of a Eurodollar Advance on a day which
is not the last day of the then applicable Interest Period with respect thereto.
When claiming indemnification under this paragraph, the Bank shall provide to
the undersigned a statement explaining the amount of any such loss or expense
which statement shall in the absence of manifest error be conclusive with
respect to the undersigned. The indemnity obligations hereunder shall survive
payment in full of the Note.

         As security for the payment of this Note and of all other obligations
and liabilities of the undersigned to the Bank, whether now or hereafter
existing, joint, several, direct, indirect, absolute, contingent, secured,
matured or unmatured, the undersigned grants to the Bank a right of setoff
against, a continuing security interest in, and an assignment and pledge of all
moneys, deposits (general or special), securities and other property of the
undersigned and the proceeds thereof, now or hereafter held by the Bank on
deposit, in safekeeping, in transit or otherwise, at any time credited by or due
from the Bank to the undersigned, or in which the undersigned shall have an
interest.

<PAGE>
 Upon the occurrence and continuance of any of the following (each an "Event of
Default"): (a) default in the payment when due of any amount hereunder; (b)
filing by or against the undersigned of a petition commencing any proceeding
under any bankruptcy, reorganization, rearrangement, readjustment of debt,
dissolution or liquidation law or statute of any jurisdiction, now or hereafter
in effect; (c) making by the undersigned an assignment for the benefit of
creditors; (d) petitioning or applying to any tribunal for the appointment of a
custodian, receiver or trustee for the undersigned or for a substantial part of
its assets; (e) death or incapacity of the undersigned (if an individual); (f)
entry of any judgment or order of attachment, injunction or governmental tax
lien or levy issued against the undersigned or against any property of the
undersigned; (g) consent by the undersigned to assume, suffer or allow to exist,
without the prior written consent of the Bank, any lien, mortgage, assignment or
other encumbrance on any of its assets or personal property, now owned or
hereafter acquired, except those liens, mortgages, assignments or other
encumbrances in existence on the date hereof and consented to in writing by the
Bank; (h) default in the punctual payment or performance of this or any other
obligation to the Bank or to any other lender at any time; (i) the existence or
occurrence at any time of one or more conditions or events which, in the sole
opinion of the Bank, has resulted or is reasonably likely to result in a
material adverse change in the business, properties or financial condition of
the undersigned; (j) failure on request to furnish any financial information or
to permit inspection of the books an records of the undersigned; (k) any
warranty, representation or statement in any application, statement or agreement
which proves false in any material respect, (l) default in the observance or
performance of any covenant or agreement of the undersigned herein or in any
other agreement between the Bank and the undersigned; or (m) any of the
foregoing events (other than the event described in clause (a)) shall occur with
respect any guarantor of the undersigned's obligations hereunder then this Note
shall, at the sole option of the Bank, become due and payable without notice or
demand; provided, however, if an event described in clause (b), clause (c) or
clause (d) above occurs, this Note shall automatically become due and payable.

         Upon the occurrence and during the continuance of an Event of Default,
the Bank shall be entitled to setoff against and apply to the payment hereof the
balance of any account or accounts maintained with the Bank by the undersigned
and to exercise any other right or remedy granted hereunder, or under any
agreement between the undersigned and the Bank or available at law or in equity,
including, but not limited to, the rights and remedies of a secured party under
the Connecticut Uniform Commercial Code. The failure by the Bank at any time to
exercise any such right shall not be deemed a waiver thereof; nor shall it bar
the exercise of any such right at a later date. Each and every right and remedy
granted to the Bank hereunder or under any agreement between the undersigned and
the Bank or available at law or in equity shall be cumulative and not exclusive
of any other rights, powers, privileges or remedies, and may be exercised by the
Bank from time to time and as often as may be necessary in the sole and absolute
discretion of the Bank.

         The undersigned agrees to pay, on demand, all of the Bank's costs and
expenses, including reasonable counsel fees (whether in-house or outside
counsel), in connection with the collection of any amounts due to the Bank
hereunder or in connection with the enforcement of the Bank's rights this Note.

         This Note shall be governed by and construed in accordance with the
laws of the State of Connecticut, without giving effect to principles of con
choice of laws.

         THE UNDERSIGNED HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY
FEDERAL OR STATE COURT IN THE STATE OF CONNECTICUT IN ANY ACTION, SUIT OR
PROCEEDING BROUGHT AGAINST IT AND RELATED TO OR IN CONNECTION WITH THIS NOTE OR
ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY AND CONSENT TO THE PLACING OF VENUE.
TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE UNDERSIGNED HEREBY WAIVES AND
AGREES NOT TO ASSERT BY WAY OF MOTION, AS A DEFENSE OR OTHERWISE, IN ANY SUCH
SUIT, ACTION OR PROCEEDING ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE
JURISDICTION OF SUCH COURTS, THAT THE SUIT, ACTION OR PROCEEDING IS BROUGHT IN
AN INCONVENIENT FORUM, THAT THE VENUE OF THE SUIT, ACTION OR PROCEEDING IS
IMPROPER,

<PAGE>
OR THAT THIS NOTE OR ANY OTHER DOCUMENT OR INSTRUMENT REFERRED TO HEREIN MAY NOT
BE LITIGATED IN OR BY SUCH COURTS. TO THE EXTENT PERMITTED BY APPLICABLE LAW,
THE UNDERSIGNED AGREES NOT TO SEEK AND HEREBY WAIVES THE RIGHT TO ANY REVIEW OF
THE JUDGMENT OF ANY SUCH COURT BY ANY COURT OF ANY OTHER NATION OR JURISDICTION
WHICH MAY BE CALLED UPON TO GRANT AN ENFORCEMENT OF SUCH JUDGMENT. THE
UNDERSIGNED AGREES THAT SERVICE OF PROCESS MAY BE MADE UPON IT BY CERTIFIED OR
REGISTERED MAIL TO ITS ADDRESS SET FORTH BELOW OR SUCH OTHER ADDRESS THAT THE
UNDERSIGNED SHALL HAVE NOTIFIED THE BANK IN WRITING OR ANY METHOD AUTHORIZED BY
THE LAWS OF THE STATE OF CONNECTICUT. EXCEPT AS PROHIBITED BY LAW, THE
UNDERSIGNED HEREBY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF
ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION
WITH THIS NOTE.

         The undersigned and the Bank hereby agree and acknowledge that any and
all information relating to the undersigned which is furnished by the
undersigned to the Bank (or to any affiliate of the Bank), and which is
non-public, confidential or proprietary in nature, shall be kept confidential by
the Bank or such affiliate in accordance with applicable law; provided, however,
that such information and other credit information relating to the undersigned
may be distributed by the Bank or such affiliate (a) to the Bank's or such
affiliate's directors, officers, employees, attorneys, affiliates, attorneys,
auditors and regulators, and (b) upon the order of a court or other governmental
agency having jurisdiction over the Bank or such affiliate, to any other party.
The undersigned and the Bank further agree that this provision shall survive the
termination of this Note.

         The Bank shall not, by any act, delay, omission or otherwise, be deemed
to have waived any of its rights and/or remedies hereunder. No change,
amendment, modification, termination, waiver, or discharge, in whole or in part,
of any provision of this Note shall be effective unless in writing and signed by
the Bank, and if so given by the Bank, shall be effective only in the specific
instance in which given. The undersigned acknowledges that this Note and the
undersigned's obligations under this Note are, and shall at all times continue
to be, absolute and unconditional in all respects, and shall at all times be
valid and enforceable irrespective of any other agreements or circumstances of
any nature whatsoever which might otherwise constitute a defense to this Note
and the obligations of the undersigned under this Note. The undersigned
absolutely, unconditionally and irrevocably waives any and all right to assert
any set-off, counterclaim or crossclaim of any nature whatsoever with respect to
this Note or the undersigned's obligations hereunder.

         In the event anyone or more of the provisions contained in this Note
should be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall
not in any way be affected or impaired thereby.

         The undersigned hereby waives presentment, demand for payment, protest,
notice of dishonor, and any and all other notices or demands in connection with
the delivery, acceptance, performance, default, or enforcement of this Note.

         As used herein the following terms shall have the following meanings:

         "Bank" shall be deemed to include the Bank, its successors and assigns
and any holder hereof.

         "Business Day" means (a) a day other than a Saturday, Sunday or other
day on which commercial banks in Connecticut are authorized or required by law
to close and (b) relative to the date of (i) continuing an Advance as, or
converting an Advance to, a Eurodollar Advance, (ii) making any payment or
prepayment of principal of or payment of interest on a Eurodollar Advance, or
(iii) the undersigned giving any notice (or the number of Business Days to
elapse prior to the effectiveness thereof) in connection with any matter
referred to in (b)(i) or (b)(ii), any day on which dealings in U.S. dollars are
carried on in the London interbank eurodollar market.

<PAGE>

         "Eurocurrency Reserve Requirement" means for any day as applied to a
Eurodollar Advance, the aggregate (without duplication) of the rates (expressed
as a decimal fraction) of reserve requirements in effect on such day (including,
without limitation, basic, supplemental, marginal and emergency reserves under
any regulations of the Board of Governors of the Federal Reserve System or other
governmental authority having jurisdiction with respect thereto), as from time
to time hereafter in effect, dealing with reserve requirements prescribed for
eurocurrency funding (currently referred to as "Eurocurrency Liabilities" in
Regulation D of such Board) maintained by a member bank of such system.

           "Interest Period" with respect to any Eurodollar Advance means:

         (a)      Initially, the period commencing on the date such Eurodollar
Advance is made and ending one, two or three months thereafter;

         (b)      thereafter, each period commencing on the last day of the next
preceding Interest Period applicable to such Eurodollar Advance an ending one,
two or three months thereafter, as selected by the undersigned by irrevocable
written notice to the Bank not less than three (3) Business Days prior to the
last day of the then current Interest Period with respect to such Eurodollar
Advance; provided, however, that all of the foregoing provisions relating to
Interest Periods are subject to the following:

                  (i)      if any Interest Period pertaining to a Eurodollar
Advance would otherwise end on a day which is not a Business Day, the Interest
Period shall be extended to the next succeeding Business Day unless the result
of such extension would be to carry such Interest Period into another calendar
month, in which event such Interest Period shall end on the immediately
preceding Business Day;

                  (ii)     if the undersigned shall fail to give notice as
provided in clause (b) above, the undersigned shall be deemed to have requested
co version of the affected Eurodollar Advance to a Prime Rate Advance on the
last day of the then current Interest Period with respect thereto;

                  (iii)    any Interest Period that begins on the last Business
Day of a calendar month (or on a day for which there is no numerically
correspond. day in the calendar month at the end of such Interest Period) shall
end on the last Business Day of a calendar month; and

                  (iv)     no Interest Period may be selected which ends later
than the Maturity Date.

         "Prime Rate" shall mean a fluctuating rate per annum equal to the prime
rate of interest as published in the Money Rates column of the Wall Street
Journal from time to time. Any change in the Prime Rate shall take effect on the
date of the change in the Prime Rate.

         "Reserve Adjusted Libor" shall mean with respect to the Interest Period
pertaining to a Eurodollar Advance, the rate per annum equal to the quotient
(rounded upwards to the next higher 1/16 of one percent) of (a) the annual rate
of interest at which dollar deposits of an amount comparable the amount of such
Loan and for a period equal to the Interest Period applicable thereto are
offered to the Bank in the London interbank market at approximately 11:00 a.m.
(London time) on the second Business Day prior to the beginning of such Interest
Period, divided by (b) a number equal to 1.00 minus the Eurocurrency Reserve
Requirement.

         "Undersigned" shall mean, if this Note is signed by more than one
party, unless otherwise stated herein, shall mean the "undersigned and each of
them" and each undertaking herein contained shall be their joint and several
undertaking. The Bank may proceed against one or more of the undersigned at one
time or from time to time as it elects in its sole and absolute discretion.

         In the event that the Bank shall have determined (which determination
shall be conclusive and binding upon the undersigned) that, by reason of
circumstances affecting the London interbank market,

<PAGE>

adequate and reasonable means do not exist for ascertaining the Reserve Adjusted
Libor for any requested Interest Period or with respect to the continuation of a
Eurodollar Advance beyond the expiration of the then current Interest Period
with respect thereto, the Bank shall forthwith give notice of such
determination, confirmed in writing, to the undersigned. If such notice is
given, any outstanding Eurodollar Advance shall be converted, on the last day of
the then current Interest Period with respect thereto, to a Prime Rate Advance.
Such notice shall be withdrawn by the Bank when the Bank shall determine that
adequate and reasonable means exist for ascertaining Reserve Adjusted Libor.

         Notwithstanding anything to the contrary contained elsewhere in this
Note, if any change after the date hereof in law, rule, regulation, guideline or
order or in the interpretation thereof by any governmental authority charged
with the administration thereof, shall make it unlawful for the Bank to make or
maintain any Advance as a Eurodollar Advance, then, by written notice to the
undersigned, the Bank may require that the Eurodollar Advance be converted to a
Prime Rate Advance, whereupon the Eurodollar Advance shall be automatically
converted to a Prime Rate Advance as of the date of such notice to the
undersigned.

         In the event that any change in applicable law or regulation, or in the
interpretation thereof by any governmental authority charged with the
administration thereof, shall impose on or deem applicable to the Bank any
reserve requirements against this Note or the Line or impose upon the Bank other
costs or assessments, the undersigned shall pay to the Bank on demand an amount
sufficient to compensate the Bank for the additional cost resulting from the
maintenance or imposition of such reserves, costs or assessments.

         Any consents, agreements, instructions or requests pertaining to any
matter in connection with this Note, signed by anyone of the undersigned shall
be binding upon all of the undersigned. This Note shall bind the respective
successors, heirs or representatives of the undersigned This Note and the Line
shall not be assigned by the undersigned without the Bank's prior written
consent.

         IN WITNESS WHEREOF, the undersigned has duly executed this Note the day
and year first above written.

Witness: Amit Shah                       CARACO PHARMACEUTICAL
                                         LABORATORIES LTD.

                                         By: /s/ Jitendra N. Doshi
                                             -----------------------------------
                                         Name: Jitendra N. Doshi
                                         Title: Chief Executive Officer

Borrower's Address:
1150 Elijah McCoy Drive
Detroit, MI 48202

State of Michigan
County of Oakland, Acting in Wayne County

On this 19th day of March 2004, Jitendra Doshi personally appeared before me,
who is personally known to me to be the signer of the above instrument, and he
acknowledged signing of his own free will.

                                         By: /s/ Susan Banks-Williams, Ph.D.
                                             -----------------------------------
                                         Susan Banks-Williams, Ph.D
                                         Notary Public, State of Michigan
                                         My Commission Expires September 1, 2007<PAGE>

                                                                   EXHIBIT 10.30

                                                                 _________, 2004

                            NEGATIVE PLEDGE AGREEMENT

         In consideration of one or more loans, advances, or other financial
accommodations or transactions, at any time before, at or after the date hereof
made or extended by Citibank, F.S.B. (the "Bank"), to Caraco Pharmaceutical
Laboratories Ltd. (the "Borrower"), the Borrower hereby agrees as follows:

1.       As used herein, the following terms shall have the following meanings:

         "Loan" shall mean the revolving line of credit in the amount of
$10,000,000 made available by the Bank to the Borrower, and such other loans,
advances or financial accommodations that the Bank may provide in the future to
the Borrower.

         "Loan Documents" shall mean the master note and all other documents
evidencing or securing the Loan or executed in connection therewith.

         "Obligations" shall mean the obligations of the Borrower to the Bank
pursuant to the Loan Documents.

         "Assets" shall mean all of Debtor's now existing and hereafter acquired
inventory, of every kind and nature, wherever located, including, without
limitation, all raw materials, finished goods, work-in-process, packing and
advertising materials and all documents, whether negotiable or nonnegotiable
representing any of the foregoing, all embedded software, and all supporting
obligations an all products and proceeds thereof; all now existing and hereafter
acquired or created accounts (including without limitation health-care insurance
receivables, credit card receivables, licensing fees an royalties and rights to
payment for realty sold or leased), together with the Debtor's interest in all
inventory described in invoices with respect to such accounts; all returned and
repossessed inventory; and all now existing and hereafter acquired or created
instruments (including promissory notes), chattel paper (whether tangible or
electronic) wherever located, including, without limitation, all of the
foregoing which arise in connection with the sale of inventory and/or the
rendition of services, and all supporting obligations and all products and
proceeds of the foregoing and all of Debtor's books and records.

         "Transfer" shall mean any bulk sale, transfer, assignment, gift,
hypothecation, pledge, mortgage or creation of any lien, encumbrance or security
interest in the Assets. Transfer shall include involuntary transfers, liens and
encumbrances arising by operation of law, judicial proceedings, contract or
otherwise, as well as transfers arising by voluntary act, but shall not include
replacement of equipment for obsolescence or upgrade, nor in the case of
inventory, use or consumption in the ordinary course of business.

         "Proceeds" shall mean the consideration of the Transfer of the Assets.

<PAGE>

2.       As long as the Obligations shall remain unpaid or unsatisfied, the
undersigned shall not, without the written consent of the Bank in each instance
first had and obtained, make any Transfer of the Asset or suffer or permit any
Transfer to be made by anyone in respect to the Asset.

3.       For notice purposes and not for the purpose of perfecting any security
interest, the Borrower authorizes the Bank to (i) file any Uniform Commercial
Code financing statements or amendments thereto without the signature of the
Borrower or by signing of the Borrower's name to any such financing statements
as its attorney-in-fact, in jurisdictions in which the Bank is unable to file
financing statements or amendments without the Borrower's signature or (ii) file
a photographic or other reproduction of this Negative Pledge Agreement (the
"Agreement") as a financing statement.

4.       a.       Unless otherwise provided in any written consent given by
the Bank in accordance with Paragraph 2, or if the Borrower shall hereafter make
any Transfer of the Assets in violation of Paragraph 2, the Proceeds derived,
received by or inuring to the benefit of the Borrower in connection therewith
are hereby transferred, set over and assigned to the Bank, and shall be received
and held by the Borrower as the trustee of an express trust solely for the
benefit of the Bank (and the Bank is hereby granted a security interest
therein), and shall be delivered to the Bank forthwith upon receipt in these
forms as received, except for the endorsement or assignment necessary to
transfer title thereto to the Bank, and such Proceeds shall be applied by the
Bank in payment or reduction of the Obligations in such order or manner and at
such time or times as the Bank, in its sole discretion, shall determine.

         b.       Further, in the event that the Borrower shall hereafter make
any Transfer of the Assets in violation of Paragraph 2, or should there occur
any violation of any of the terms hereof, same shall be considered to be an
Event of Default under the provisions of the Loan Documents, and the Bank shall
have each of its remedies under the Loan Documents.

5.       The Borrower hereby irrevocably designates and appoints the Bank, its
agents and designees, as attorney-in-fact for, and in the name of, the Borrower
with full power and authority (but under no duty), to enforce and protect all of
the rights herein granted to the Bank. Said power of attorney is coupled with an
interest. The Borrower hereby authorizes the making and delivery by such
attorney-in-fact, for and in the name of the Borrower, of any and all additional
documents, instruments, assignments or endorsements deemed necessary or
desirable to assure the fulfillment of the purposes hereof, hereby ratifying and
confirming, in all respects, the action by such attorney-in-fact.

6.       Nothing herein contained shall, in any manner, be deemed to amend,
supersede or modify any term or provision of any note, guarantee, security
agreement, collateral loan agreement or other instrument evidencing any loan or
obligation of the Borrower to the Bank, it being understood that the terms of
this Agreement shall be deemed merely supplemental thereto.

7.       The provision hereof shall be binding upon the Borrower and upon the
Borrower's successors, and assigns, as the case may be, and shall inure to the
benefit of the Bank, its successors, transferees and assigns. This Agreement
shall be governed by, and construed in accordance with, the law of the State of
Connecticut, and cannot be changed or terminated orally.

                                         CARACO PHARMACEUTICAL
                                         LABORATORIES LTD.

                                         By: /s/ Jitendra N. Doshi
                                             -----------------------------------
                                                Name: Jitendra N. Doshi
                                                Title: Chief Executive Officer

State of Michigan

County of Oakland, Acting in Wayne County

On this 19th day of March 2004, Jitendra Doshi personally appeared before me,
who is personally known to me to be the signer of the above instrument, and he
acknowledged signing of his own free will.

                                         By: /s/ Susan Banks-Williams, Ph.D.
                                             -----------------------------------
                                         Susan Banks-Williams, Ph.D
                                         Notary Public, State of Michigan
                                         My Commission Expires September 1, 2007

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