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EXHIBIT 10.1  

 
 

BUSINESS CONSULTING AGREEMENT    
  

    This Agreement (the "Agreement") is dated June 20, 2001 and is entered into by and between REMEDENT
USA, INC.(hereinafter "REMM" or "CLIENT") and WINDSOR PARTNERS, INC. (hereinafter "WPI"). 

	1.
	Conditions. This Agreement will not take effect, and WPI will have no obligation to provide any service whatsoever, unless and until
CLIENT returns a signed copy of this Agreement to WPI (either by mail or facsimile copy). In addition, CLIENT shall be truthful with WPI in regard to any relevant or material information provided by
CLIENT, verbally or otherwise which refers, relates, or otherwise pertains to the CLIENT's business, this Agreement or any other relevant transaction. Breach of either of these conditions shall be
considered a material breach and will automatically grant WPI the right to terminate this Agreement and all moneys, and other forms of compensation, paid or owing as of the date of termination by WPI
shall be forfeited without further notice. 

    Upon
execution of this Agreement, CLIENT agrees to fully cooperate with WPI in carrying out the purposes of this Agreement, keep WPI informed of any developments of importance
pertaining to CLIENT's business and abide by this Agreement in its entirety. 

	2.
	Scope and Duties. During the term of this Agreement, WPI will perform the following services for CLIENT:

	2.1
	Advice and Counsel. WPI will provide advice and counsel regarding CLIENT's strategic business plans, strategy and negotiations with
potential business strategic partnering, corporate planning and or other general business consulting needs as expressed by CLIENT.

	2.2
	Mergers and Acquisitions. WPI will provide assistance to CLIENT, as mutually agreed, in identifying merger and / or acquisition
candidates, assisting in any due diligence process, recommending transaction terms and providing advice and assistance during negotiations, as needed.

	2.3
	CLIENT and/or CLIENT's Affiliate Transaction Due Diligence. WPI will participate and assist CLIENT in the due diligence process,
where possible, on all proposed financial transactions affecting CLIENT of which WPI is notified in writing in advance, including conducting investigation of and providing advice on the financial,
valuation and stock price implications of the proposed transaction(s).

	2.4
	Ancillary Document Services. If necessary, WPI will assist and cooperate with CLIENT in the development, editing and production of
such documents as are reasonably necessary to assist in any transaction covered by this Agreement. However, this Agreement will not include the preparation or procuring of legal documents or those
documents normally prepared by an attorney.

	2.5
	Additional Duties. CLIENT and WPI shall mutually agree, in writing, for any additional duties that WPI may provide to CLIENT for
compensation paid or payable by CLIENT under this Agreement. Although there is no requirement to do so, such additional agreement(s) may be attached hereto and made a part hereof by written amendments
to be listed as "Exhibits" beginning with "Exhibit A" and initialed by both parties.

	2.6
	Standard of Performance. WPI shall devote such time and efforts to the affairs of the CLIENT as is reasonably necessary to render the
services contemplated by this Agreement. Any work or task of WPI provided for herein which requires CLIENT to provide certain information to assist WPI in completion of the work shall be excused
(without effect upon any obligation of CLIENT) until such time as CLIENT has fully provided all information and cooperation necessary for WPI to complete the work. The services of WPI shall not
include the rendering of any legal opinions or the performance of any work that is in the ordinary purview of a certified public accountant, or other licensed professional. WPI cannot guarantee
results on behalf of CLIENT, but shall use 

commercially
reasonable efforts in providing the services listed above. If an interest is communicated to WPI regarding satisfying all or part of CLIENT's business and corporate strategic planning
needs, WPI shall notify CLIENT and advise it as to the source of such interest and any terms and conditions of such interest. 

	2.7
	Non-Guarantee. WPI MAKES NO GUARANTEE THAT WPI WILL BE ABLE TO SUCCESSFULLY LOCATE A MERGER OR ACQUISITION TARGET AND IN
TURN CONSUMMATE A MERGER OR ACQUISITION TRANSACTION FOR CLIENT, OR TO SUCCESSFULLY COMPLETE SUCH A TRANSACTION WITHIN CLIENT'S DESIRED TIME FRAME. NEITHER ANYTHING IN THIS AGREEMENT TO THE CONTRARY
NOR THE PAYMENT OF DEPOSITS TO WPI BY CLIENT PURSUANT TO FEE AGREEMENTS FOR SERVICES NOT CONTEMPLATED HEREIN SHALL BE CONSTRUED AS ANY SUCH GUARANTEE. ANY COMMENTS MADE REGARDING POTENTIAL TIME FRAMES
OR ANYTHING THAT PERTAINS TO THE OUTCOME OF CLIENT'S NEEDS ARE EXPRESSIONS OF OPINION ONLY, AND FOR PURPOSES OF THIS AGREEMENT ARE SPECIFICALLY DISAVOWED.

	3.
	Compensation to WPI.

 
	3.1
	 Issuance of Shares for Entering into Agreement. As consideration for WPI entering into this Agreement, Client agrees to cause 300,000 shares
of its common
stock, par value $.001 per share, to be issued in amounts of 150,000 shares to Richard Walker and  150,000 shares to Scott Absher, affiliates of WPI. When issued, said shares shall be
free trading shares, registered with the U.S. Securities and Exchange Commission on its Form S-8 or similar registration. The registration and issuance of said shares shall take
place by no later than 15 days following the execution and delivery of this Agreement, and all costs in connection therewith shall be borne by Client. 

    NOTE:  WPI SHALL HAVE NO OBLIGATION TO PERFORM ANY DUTIES PROVIDED FOR HEREIN IF PAYMENT [CASH AND/OR STOCK] IS NOT RECEIVED BY WPI
WITHIN 15 DAYS OF MUTUAL EXECUTION OF THIS AGREEMENT BY THE PARTIES. IN ADDITION, WPI'S OBLIGATIONS UNDER THIS AGREEMENT SHALL BE SUSPENDED IF ANY PAYMENT OWING HEREUNDER IS MORE THAN FIFTEEN
(15) DAYS DELINQUENT. FURTHERMORE, THE RECEIPT OF ANY FEES DUE TO WPI UPON EXECUTION OF THIS AGREEMENT ARE NOT CONTINGENT UPON ANY PRIOR PERFORMANCE OF ANY DUTIES WHATSOEVER DESCRIBED WITHIN
THIS AGREEMENT.

	3.2
	Fees for Merger/Acquisition. In the event that WPI, assists CLIENT and / or introduces CLIENT (or a CLIENT affiliate) to any third
party, merger partner(s) or joint venture(s) who then enters into a merger, joint venture or similar agreement with CLIENT or CLIENT's affiliate, CLIENT hereby agrees to pay WPI advisory fees pursuant
to the following schedule which are based on the aggregate amount of such merger, joint venture or similar agreement with CLIENT or CLIENT's affiliate. Advisory fees are deemed earned and shall be due
and payable at the first close of the transaction, however, in certain circumstances when payment of advisory fees at closing is not possible, within 24 hours after CLIENT has received the
proceeds of such business combination. This provision shall survive this Agreement for a period of one year after termination or expiration of this Agreement. In other words, the advisory fee shall be
deemed earned and due and payable for any merger, joint venture or similar transaction which first closes within a year of the termination or expiration of this Agreement as a result of an
introduction as set forth above.

	3.3
	Merger/Acquisition Advisory Fees Schedule. For a merger/acquisition entered into by CLIENT as a result of the efforts of, or an
introduction by WPI during the term of this Agreement, Client shall pay WPI Merger/Acquisition Advisory Fees as follows:

	•
	For
the first merger and/or acquisition of approximate annual revenue equal to or exceeding $         35 million, 2,200,000 shares of its
common stock, 950,000 of which shall be free trading shares, registered with the U.S. Securities and Exchange Commission on its Form S-8 or similar registration. The remaining
1,250,000 shares shall be restricted subject to Rule 144. 

	•
	When
the annual revenue run rate for the aggregate of all businesses WPI has assisted CLIENT and/or introduced CLIENT (or a CLIENT affiliate) to any third
party, merger partner(s) or joint venture(s) who then entered into a merger, joint venture or similar agreement with CLIENT or CLIENT's affiliate, reaches fifty-five million ($55,000,000),
750,000 shares of its common stock, 375,000 of which shall be free trading shares, registered with the U.S. Securities and Exchange Commission on its Form S-8 or similar
registration. The remaining 375,000 shares shall be restricted subject to Rule 144.

	•
	Thereafter,
for a merger/acquisition entered into by CLIENT as a result of the efforts of, or an introduction by WPI during the term of this Agreement,
Client shall pay WPI, eight (8) percent of the total value of the transaction. For a merger/acquisition entered into by CLIENT as a result of the efforts of WPI and the introduction by CLIENT
during the term of this Agreement, Client shall pay WPI, five (5) percent of the total value of the transaction. Such percentage(s) shall be paid to WPI in the same ratio of cash and / or stock
as the transaction. 

	3.4
	Expenses. After initial acquisition, CLIENT shall reimburse WPI for reasonable expenses incurred in performing its duties pursuant to
this Agreement (including printing, postage, express mail, photo reproduction, travel, lodging, and long distance telephone and facsimile charges); provided, however, that WPI must receive prior
written approval from CLIENT for any expenses over $         500. Such reimbursement shall be payable within 7 seven days after CLIENT's receipt of WPI invoice for same.

	3.5
	Additional Fees. CLIENT and WPI shall mutually agree upon any additional fees that CLIENT may pay in the future for services rendered
by WPI under this Agreement. Such additional agreement(s) may, although there is no requirement to do so, be attached hereto and made a part hereof as Exhibits beginning with Exhibit A.

	4.
	Indemnification. The CLIENT agrees to indemnify and hold harmless WPI, each of its officers, directors, employees, agents, and
shareholders against any and all liability, loss and costs, expenses or damages, including but not limited to, any and all expenses whatsoever reasonably incurred in investigating, preparing or
defending against any litigation, commenced or threatened, or any claim whatsoever or howsoever caused by reason of any injury (whether to body, property, personal or business character or reputation)
sustained by any person or to any person or property, arising out of any act, failure to act, neglect, any untrue or alleged untrue statement of a material fact or failure to state a material fact
which thereby makes a statement false or misleading, or any breach of any material representation, warranty or covenant by CLIENT or any of its agents, employees, or other representatives. WPI agrees
to indemnify and hold harmless the CLIENT, each of its officers, directors, employees, agents, and shareholders against any and all liability, loss and costs, expenses or damages, including but not
limited to, any and all expenses whatsoever reasonably incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever or howsoever caused by
reason of any injury (whether to body, property, personal or business character or reputation) sustained by any person or to any person or property, arising out of any act, failure to act,
neglect, any untrue or alleged untrue statement of a material fact or failure to state a material fact which thereby makes a statement false or misleading, or any breach of any material
representation, warranty or covenant by WPI or any of its agents, employees, or other representatives. Nothing herein is intended to nor shall it relieve either party from liability for its own
willful act, omission or negligence. All remedies provided by law, or in equity shall be cumulative and not in the alternative.

	5.
	Confidentiality.

	5.1
	WPI
and CLIENT each agree to keep confidential and provide reasonable security measures to keep confidential information where release may be detrimental to their respective
business interests. WPI and CLIENT shall each require their employees, agents, affiliates, other licensees, and others who will have access to the information through WPI and CLIENT respectively, to
first enter appropriate non-disclosure Agreements requiring the confidentiality contemplated by this Agreement in perpetuity. 

	5.2
	WPI
will not, either during its engagement by the CLIENT pursuant to this Agreement or at any time thereafter, disclose, use or make known for its or another's benefit any
confidential information, knowledge, or data of the CLIENT or any of its affiliates in any way acquired or used by WPI during its engagement by the CLIENT. Confidential information, knowledge or data
of the CLIENT and its affiliates shall not include any information that is, or becomes generally available to the public other than as a result of a disclosure by WPI or its representatives.

	6.
	Miscellaneous Provisions.

	6.1
	Amendment and Modification. This Agreement may be amended, modified and supplemented only by written agreement of WPI and CLIENT.

	6.2
	Assignment. This Agreement and all of the provisions hereof shall be binding upon and inure to the benefit of the parties hereto and
their respective successors and permitted assigns. The obligations of either party hereunder cannot be assigned without the express written consent of the other party.

	6.3
	Governing Law; Venue. This Agreement and the legal relations among the parties hereto shall be governed by and construed in
accordance with the laws of the State of California, without regard to its conflict of law doctrine. CLIENT and WPI agree that if any action is instituted to enforce or interpret any provision of this
Agreement, the jurisdiction and venue shall be Orange County, California.

	6.4
	Attorneys' Fees and Costs. If any action is necessary to enforce and collect upon the terms of this Agreement, the prevailing party
shall be entitled to reasonable attorneys' fees and costs, in addition to any other relief to which that party may be entitled. This provision shall be construed as applicable to the entire Agreement.

	6.5
	Survivability. If any part of this Agreement is found, or deemed by a court of competent jurisdiction, to be invalid or
unenforceable, that part shall be severable from the remainder of the Agreement.

	6.6
	Counterparts. This Agreement may be executed in several counterparts and it shall not be necessary for each party to execute each of
such counterparts, but when all of the parties have executed and delivered one of such counterparts, the counterparts, when taken together, shall be deemed to constitute one and the same instrument,
enforceable against each party in accordance with its terms.

	6.7
	Facsimile Signatures. The Parties hereto agree that this Agreement may be executed by facsimile signatures and such signatures shall
be deemed originals. The parties further agree that within ten days following the execution of this Agreement, they shall exchange original signature pages.

	7.
	Arbitration. ALL DISPUTES, CONTROVERSIES, OR DIFFERENCES BETWEEN CLIENT, WPI OR ANY OF THEIR OFFICERS, DIRECTORS, LEGAL
REPRESENTATIVES, ATTORNEYS, ACCOUNTANTS, AGENTS OR EMPLOYEES, OR ANY CUSTOMER OR OTHER PERSON OR ENTITY, ARISING OUT OF, IN CONNECTION WITH OR AS A RESULT OF THIS AGREEMENT, SHALL BE RESOLVED THROUGH
ARBITRATION RATHER THAN THROUGH LITIGATION. WITH RESPECT TO THE ARBITRATION OF ANY DISPUTE, THE UNDERSIGNED HEREBY ACKNOWLEDGE AND AGREE THAT: 

 A. ARBITRATION IS FINAL AND BINDING ON THE PARTIES;  

    B. THE PARTIES ARE WAIVING THEIR RIGHT TO SEEK REMEDY IN COURT, INCLUDING THEIR RIGHT TO JURY TRIAL;

    C. PRE-ARBITRATION DISCOVERY IS GENERALLY MORE LIMITED AND DIFFERENT FROM COURT PROCEEDING;

    D. THE ARBITRATOR'S AWARD IS NOT REQUIRED TO INCLUDE FACTUAL FINDINGS OR LEGAL REASONING AND ANY PARTY'S RIGHT OF APPEAL OR TO SEEK MODIFICATION OF RULING BY
THE ARBITRATORS IS STRICTLY LIMITED;

    E. THIS ARBITRATION PROVISION IS SPECIFICALLY INTENDED TO INCLUDE ANY AND ALL STATUTORY CLAIMS WHICH MIGHT BE ASSERTED BY ANY PARTY;

    F. EACH PARTY HEREBY AGREES TO SUBMIT THE DISPUTE FOR RESOLUTION TO THE AMERICAN ARBITRATION ASSOCIATION, IN ORANGE COUNTY, CALIFORNIA WITHIN FIVE
(5) DAYS AFTER RECEIVING A WRITTEN REQUEST TO DO SO FROM THE OTHER PARTY;

    G. IF EITHER PARTY FAILS TO SUBMIT THE DISPUTE TO ARBITRATION ON REQUEST, THEN THE REQUESTING PARTY MAY COMMENCE AN ARBITRATION PROCEEDING, BUT IS UNDER NO
OBLIGATION TO DO SO;

    H. ANY HEARING SCHEDULED AFTER AN ARBITRATION IS INITIATED SHALL TAKE PLACE IN ORANGE COUNTY, CALIFORNIA;

    I. IF EITHER PARTY SHALL INSTITUTE ANY COURT PROCEEDING IN AN EFFORT TO RESIST ARBITRATION AND BE UNSUCCESSFUL IN RESISTING ARBITRATION OR SHALL UNSUCCESSFULLY
CONTEST THE JURISDICTION OF ANY ARBITRATION FORUM LOCATED IN ORANGE COUNTY, CALIFORNIA, OVER ANY MATTER WHICH IS THE SUBJECT OF THIS AGREEMENT, THE PREVAILING PARTY SHALL BE ENTITLED TO RECOVER FROM
THE LOSING PARTY ITS LEGAL FEES AND ANY OUT-OF-POCKET EXPENSES INCURRED IN CONNECTION WITH THE DEFENSE OF SUCH LEGAL PROCEEDING OR ITS EFFORTS TO ENFORCE ITS RIGHTS TO
ARBITRATION AS PROVIDED FOR HEREIN;

    J. THE PARTIES SHALL ACCEPT THE DECISION OF ANY AWARD AS BEING FINAL AND CONCLUSIVE AND AGREE TO ABIDE THEREBY;

    K. ANY DECISION MAY BE FILED WITH ANY COURT AS A BASIS FOR JUDGMENT AND EXECUTION FOR COLLECTION.

	8.
	Term/Termination. This Agreement is an agreement for the term of approximately twenty-four (24) months ending
June 30, 2003.

	9.
	Non Circumvention. In and for valuable consideration, CLIENT hereby agrees that WPI may introduce (whether by written, oral, data, or
other form of communication) CLIENT to one or more opportunities, including, without limitation, natural persons, corporations, limited liability companies, partnerships, unincorporated businesses,
sole proprietorships and similar entities (hereinafter an "Opportunity" or "Opportunities""). CLIENT further acknowledges and agrees that the identity of the subject Opportunities, and all other
information concerning an Opportunity (including without limitation, all mailing information, phone and fax numbers, email addresses and other contact information) introduced hereunder are the
property of WPI, and shall be treated as confidential and proprietary information by CLIENT, it affiliates, officers, directors, shareholders, employees, agents, representatives, successors and
assigns. CLIENT shall not use such information, except in the context of any arrangement with WPI in which WPI is directly and actively involved, and never without WPI's prior written approval. CLIENT
further agrees that neither it nor its employees, affiliates or assigns, shall enter into, or otherwise arrange (either for it/him/herself, or any other person or entity) any business relationship,
contact any person regarding such Opportunity, either directly or indirectly, or any of its affiliates, or accept any compensation or advantage in relation to such Opportunity except as directly
though WPI, without the prior written approval of WPI. WPI is relying on CLIENT's assent to these terms and their intent to be bound by the terms by evidence of their signature. Without CLIENT's
signed assent to these terms, WPI would not introduce any Opportunity or disclose any confidential information to CLIENT as herein described. 

    [SIGNATURES FOLLOW NEXT PAGE]

    IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed, all as of the day and year first above written. 

REMEDENT USA, INC. (REMM)  

Print Name: Rebecca Inzunza/Hegemann 

Sign
Name: /s/ Rebecca Inzunza/Hegemann 

Title:
CEO 

Date:
June 28, 2001 

Address:
1220 Birch Way

Escondido, CA 92007 

WINDSOR PARTNERS, INC. (WPI)  

Print Name: Richard H. Walker 

Sign
Name: /s/ Richard H. Walker 

Title:
President 

Date:
June 28, 2001 

Address:
28202 Cabot Road, Suite 300

Laguna Niguel, CA 92677 

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BUSINESS CONSULTING AGREEMENTPrepared by MERRILL CORPORATION

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Exhibit 4.34    
  

FORBEARANCE AGREEMENT  

    THIS FORBEARANCE AGREEMENT (this "Agreement") is entered into as of June 29, 2001 among LEINER HEALTH
PRODUCTS INC. (the "U.S. Borrower"), VITA HEALTH PRODUCTS INC. (the "Canadian Borrower,"
and together with the U.S. Borrower, the "Borrowers"), THE BANK OF NOVA SCOTIA, as U.S. Agent and as Canadian Agent, and the lenders party to the Credit
Agreement referred to below. 

RECITALS  

    A.  Pursuant
to that certain Amended and Restated Credit Agreement, dated as of May 15, 1998 (as further amended, supplemented, amended and restated or otherwise
modified prior to the date hereof, the "Credit Agreement"; capitalized terms used but not defined herein shall have the meanings given them in the
Credit Agreement), the Agents and the Lenders made Loans and other financial accommodations to the Borrowers. 

    B.  The
following Defaults or Events of Default (the "Existing Defaults") exist or are expected to exist under the
Credit Agreement: 

    1.  The
failure of the Borrowers to comply with each of the financial covenants set forth in Section 9.2.4 of the Credit Agreement as of or for the Fiscal
Quarters ending December 31, 2000, March 31, 2001, and June 30, 2001; and 

    2.  The
Borrowers' breach of the representations, warranties and statements contained in the Loan Documents in connection therewith. 

    C.  The
Borrowers have requested that the Required Lenders forbear from exercising any of their rights or remedies under the Credit Agreement, the other Loan Documents
or applicable law in connection with the Existing Defaults. 

    D.  The
Required Lenders are willing to forbear from exercising their rights and remedies in connection with the Existing Defaults on the terms and conditions set forth
herein. 

AGREEMENT  

    In consideration of the Recitals and of the mutual promises and covenants contained herein, the Borrowers, the Agents and the Required Lenders agree as
follows: 

    Section 1.  Agreement to Forbear.  

    (a)  Forbearance.  During the period (the "Forbearance
Period") commencing on the date hereof and ending on the earlier to occur of September 1, 2001 (as such date may be extended in accordance with Section 1(b)) and
the date of any Forbearance Default (as defined below), and subject to the satisfaction of the conditions set forth in Section 2 hereof, the Agents and the Lenders will forbear from exercising
their rights and remedies (other than the right to deliver a payment blockage notice to the Indenture Trustee and to the U.S. Borrower under Section 14.3(b) of the Subordinated Indenture) under
the Credit Agreement and the other Loan Documents solely with respect to the Existing Defaults. "Forbearance Default" shall mean: (i) an Event of
Default (other than the Existing Defaults), (ii) the failure of either Borrower to keep or perform any of the covenants or agreements contained herein providing for a payment or prepayment to
the Agents or the Lenders, (iii) the failure of either Borrower to keep or perform any of the covenants or agreements contained herein (other than those referred to in clause (ii) above)
two Business Days after the date the Borrowers receive written notice from an Agent of any such failure (the "Notice Period"),  provided that in the event
any such failure is remedied within the Notice Period, such failure shall not constitute a Forbearance Default or
(iv) any representation or warranty of either Borrower herein shall be incorrect when made or deemed made in any material respect. 

 

    (b)  Extension of Forbearance.  So long as no Forbearance Default shall have
occurred, if, on or before August 31, 2001, the Borrowers execute a term sheet for a Restructuring (as defined below) which is
mutually acceptable to the Agents and the Lenders, the Forbearance Period shall be automatically extended to the earlier to occur of September 28, 2001 and the date of any Forbearance Default. 

    (c)  Nature of the Forbearance.  The forbearance set forth herein is limited and
shall not be deemed (i) a waiver of any Default or Event of Default, including the Existing Defaults, which now exist or may hereafter arise, (ii) a forbearance with respect to any term,
condition or obligation of the Borrowers in the Credit Agreement or any other Loan Document other than the Existing Defaults, (iii) a waiver of any of the conditions precedent to Credit
Extensions contained in Section 7.2 of the Credit Agreement or (iv) subject to the terms contained herein, to prejudice any right or remedy which any Agent or any Lender may now or in
the future have under or in connection with the Credit Agreement or any other Loan Document. 

    Section 2.  Conditions Precedent to Effectiveness of
Agreement.  This Agreement shall not be effective unless and until each of the following conditions shall have been satisfied in the sole discretion of the
Agents: 

    (a) The
Agents shall have received (i) counterparts of this Agreement duly executed by each of the Borrowers and the Required Lenders and (ii) an
Affirmation and Consent, in form and substance satisfactory to the Agents, duly executed by each of the Guarantors. 

    (b) The
Agents shall have received, for the pro rata benefit of the Lenders executing this Agreement on or before July 11, 2001 (the
"Consenting Lenders"), a forbearance fee of $600,000, which shall be fully earned when paid and nonrefundable. 

    (c) The
Agents shall have received $700,000 to be applied as a pro rata prepayment of the Loans (and, in the case of Canadian Loans, based on a U.S. to Canadian dollar
exchange rate in effect at the time of payment as determined by the Agents). 

    (d) The
Borrowers shall have deposited in immediately available funds with (i) the U.S. Agent, $6,094,212.77 representing interest that will accrue on the Credit
Extensions under the U.S. Facility (calculated based on the U.S. Alternate Base Rate as in effect on the date hereof and as increased hereunder) and (ii) the Canadian Agent, Cdn.$1,050,763.86,
representing interest that will accrue on the Credit Extensions under the Canadian Facility (calculated based on the Canadian Prime Rate as in effect on the date hereof and as increased hereunder), in
each case for July, August and September, 2001. The foregoing payments shall be held in escrow on terms satisfactory to the applicable Agent and shall be applied by the applicable Agent to the monthly
payment of interest on the applicable Credit Extensions for each of July, August and September, 2001. 

    (e) The
Agents shall have been reimbursed for the unpaid fees and expenses incurred through the date hereof of its professionals, including the unpaid fees and expenses
of Luskin, Stern & Eisler LLP, PricewaterhouseCoopers LLP, Casas, Benjamin & White, LLC ("CBW") and Hunton & Williams. 

    Section 3.  Representations and Warranties.  The
Borrowers hereby represent and warrant to the Agents and to the Lenders as follows: 

    (a)  Recitals.  The Recitals in this Agreement are true and correct in all
respects. 

    (b)  Incorporation of Representations and Statements.  All statements of the
Borrowers contained in Section 7.2.1 of the Credit Agreement, and all representations and warranties of the Borrowers in the Credit Agreement and the other Loan Documents, are incorporated
herein in full by this reference and are, other than with respect to the Existing Defaults and, to the extent 

2

 

applicable, the Excluded Items referred to in the Fourth Amendment dated May 31, 2001 to the Waiver Letter dated February 13, 2001 from the Borrowers to the Lenders, true and correct as
of the date hereof in all material respects. 

    (c)  Power; Authorization.  Each of the Borrowers has the corporate power, and
has been duly authorized by all requisite corporate action, to execute and deliver this Agreement and to perform its obligations hereunder. This Agreement has been duly executed and delivered by the
Borrowers. 

    (d)  Enforceability.  This Agreement is the legal, valid and binding obligation
of each of the Borrowers, enforceable against them in accordance with its terms. 

    (e)  No Violation.  The execution, delivery and performance of this Agreement
does not and will not (i) violate any law, rule, regulation or court order to which either of the Borrowers is subject, (ii) conflict with or result in a breach of any Organic Document
of the Borrowers or any agreement or instrument to which either of the Borrowers is party or by which it or its properties are bound, or (iii) result in the creation or imposition of any Lien,
security interest or encumbrance on any property of either of the Borrowers, whether now owned or hereafter acquired, other than liens in favor of the Agents. 

    (f)  Obligations.  As of the date hereof the outstanding principal balance of the
U.S. Revolving Loans is $91,115,000; U.S. Letter of Credit Outstandings is $11,902,372 (of which $1,600,000 is cash collateralized under the terms of a Cash Collateral Agreement dated as of
April 16, 2001); Term B Loans is $65,452,500; Term C Loans is $62,587,500; Term D Loans is $29,400,000; Canadian Revolving Loans is Cdn.$28,800,000; Canadian Swingline Loans is Cdn.$230,000;
and Canadian Term Loans is Cdn.$16,641,000. Interest and fees have accrued thereon as provided in the Credit Agreement and the other Loan Documents. The obligation of the Borrowers to repay the Loans,
together with all interest
and fees accrued thereon, and the other Obligations is absolute and unconditional, and there exists no right of set off or recoupment, counterclaim or defense of any nature whatsoever to payment of
the Obligations. 

    Section 4.  Covenants of Borrowers.  The Borrowers
agree as follows: 

    (a)  Forecasts.  By no later than 4:00 p.m. on the second Business Day of
each week, the Borrowers will deliver to the Agents updated weekly rolling cash flow forecasts for the following twelve week period, together with an actual to forecast variance analysis for the
preceding week, which forecasts shall also include a certification from an Authorized Officer of the U.S. Borrower representing to the information required pursuant to paragraph (c) below. 

    (b)  U.S. Balance Sheets.  Within 30 days after the end of each month, the
Borrowers will deliver to the Agents consolidated and consolidating balance sheets of the U.S. Borrower and its Subsidiaries (including consolidating balance sheets of the Canadian Borrower and its
Subsidiaries) as of the end of such month, and consolidated and consolidating statements of earnings and cash flow of the U.S. Borrower and its Subsidiaries (including consolidating statements of
earnings and cash flow of the Canadian Borrower and its Subsidiaries) for such month and for the period commencing at the end of the previous Fiscal Year and ending with the last day of such month. 

    (c)  Disbursements, etc.  The Borrowers will not permit cumulative (from
July 1, 2001) disbursements for all applicable months, as set forth in the Borrowers' June 27, 2001 rolling 13-week forecast, as may be revised with the approval of CBW (the
"Forecast"), to exceed 110% of the cumulative (from July 1, 2001) amounts set forth therefor in the Forecast and will not permit the cash balance
at the end of any month to be less than 90% of the cash balance set forth in the Forecast for such month. The Borrowers agree that all payments or disbursements to an Affiliate or employee of a
Borrower (including Severance Payments (as defined below)) inconsistent with the Forecast or which are otherwise outside of the ordinary course of business must be approved in advance by David Coles. 

3

 

    (d)  Cooperation.  The Borrowers agree to cooperate fully with the Agents, the
Lenders and their professionals, including in connection with any audit or appraisal of the business, assets or financial condition of the Borrowers and their Subsidiaries, in all cases at the
Borrowers' expense. 

    (e)  Payment of Fees.  In addition to and not in limitation of the terms of
Section 12.3 of the Credit Agreement, the Borrowers agree to pay on demand all reasonable fees and expenses of (i) the Agents and all professionals retained by the Agents or by Luskin,
Stern & Eisler LLP (including special counsel engaged to review various litigation issues), and (ii) each Lender (other than the legal fees of each
Lender expressly excepted from payment under Section 12.3 of the Credit Agreement), in each case incurred in connection with this Agreement and the matters contemplated hereby and the
restructuring of the Obligations, and whether incurred prior to or subsequent to the date hereof. 

    (f)  Bank Accounts.  Neither the Borrowers nor any of their Subsidiaries will
maintain any checking, savings or other account at any bank or other financial institution, or any other account where money or securities may be deposited or maintained, other than the accounts
specified in the Amended and Restated Perfection Certificate dated as of June 15, 2001. The Borrowers agree that all financial assets on deposit or maintained in Wells Fargo Bank, National
Association ("Wells Fargo"), account no. 12384681 (or any similar overnight investment account), shall be immediately transferred to the
Concentration Account (as defined in the Concentration Bank Agreement, dated as of April 3, 2001, by the U.S. Borrower and Wells Fargo in favor of The Bank of Nova Scotia, as agent), and that
amounts on deposit or financial assets maintained in the Concentration Account shall not be transferred to any other account (including to any overnight account) for investment unless, prior to such
transfer, the U.S. Borrower shall have executed and delivered and shall have caused any securities intermediary or similar entity required by the Agents to execute and deliver, all documentation
required by the Agents to create and perfect the Agents' security interest in such account and investments. The Agents agree to use reasonable efforts to prepare and deliver to the U.S. Borrower the
foregoing documentation and agree to negotiate in good faith with the U.S. Borrower in connection with any reasonable request by the U.S. Borrower to invest amounts on deposit in the Concentration
Account. 

    (g)  Suspension of Commitments.  The Commitments are suspended. 

    (h)  LIBOR Restrictions.  The outstanding principal amount of the Loans may not
be continued as, or converted into, LIBO Rate Loans or Canadian BAs, as applicable. 

    (i)  Increased Interest.  The Applicable Margin shall in each case be increased
by 1% over that otherwise in effect in accordance with the terms of the Credit Agreement. 

    (j)  Restrictions on Indebtedness, Etc.  The Borrowers and their Subsidiaries are
prohibited from incurring Indebtedness under clauses (d), (g), (h) or (l) of Section 9.2.2 of the Credit Agreement; making Investments under clauses (f), (i) or
(j) of Section 9.2.5 of the Credit Agreement; redeeming shares of Capital Stock under clause (iii) of the proviso to Section 9.2.6 of the Credit Agreement; consummating
acquisitions or mergers under clauses (b), (c) or (d) of Section 9.2.10 of the Credit Agreement; or paying any fees under clause (b) of Section 9.2.13 of the Credit
Agreement. 

    (k)  Monthly Payment of Interest and Fees.  All interest for Base Rate Loans and
Canadian Prime Rate Loans, and all Letter of Credit fees payable under Section 5.3.3 of the Credit Agreement, shall be payable in arrears on the fifteenth day of each month (instead of the
Quarterly Payment Dates). 

    (l)  Canadian Balance Sheets.  Within 21 days after the end of each month,
the Canadian Borrower will deliver to the Canadian Agent consolidated and consolidating balance sheets of the Canadian Borrower and its Subsidiaries as of the end of such month and consolidated
statements 

4

 

of earnings and cash flow of the Canadian Borrower and its Subsidiaries for such month and for the period commencing at the end of the previous Fiscal Year and ending with the last day of such month. 

    (m)  Intercompany Dispositions.  The U.S. Borrower and its U.S. Subsidiaries will
not, directly or indirectly, make any Investments (including intercompany loans or capital contributions) in or to the Canadian Borrower or any of the Canadian Borrower's Subsidiaries, or sell,
transfer, lease, contribute or otherwise convey (including by way of merger), or grant options, warrants or other rights (all collectively referred to as a
"Disposition") with respect to all or any part of their assets to the Canadian Borrower or any of the Canadian Borrower's Subsidiaries other than in the
ordinary course of business consistent with past practices. The Canadian Borrower and its Subsidiaries will not, directly or indirectly, make any Investments (including intercompany loans or capital
contributions) in or to (or pay dividends or make distributions to) the U.S. Borrower or any of the U.S. Borrower's U.S. Subsidiaries, or make any Disposition with respect to all or any part of their
assets to the U.S. Borrower or any of the U.S. Borrower's U.S. Subsidiaries, other than in the ordinary course of business consistent with past practices. 

    (n)  Restrictions on Reallocation of Commitments.  The Borrowers' right to
reallocate the unused Canadian Revolving Loan Commitment Amount and the unused U.S. Revolving Loan Commitment Amount pursuant to, respectively, Sections 2.2.3 and 3.2.2 of the Credit Agreement is
suspended. 

    (o)  Antitrust Proceeds.  Unless otherwise agreed to by the Required Lenders,
including as to amount and application, concurrently with the receipt by either of the Borrowers or any of their Affiliates of any judgment, settlement or other proceeds or amounts, however
characterized (with all of the foregoing collectively referred to as the "Proceeds"), arising from or in connection with any antitrust claims (the
"Claims") (including claims pending in (i) the United States District Court for the Central District of California styled  Leiner Health Products Inc. v. F.
Hoffman-LaRoche Ltd., et al., Case No. 99-09832-JSL and (ii) the
United States District Court for the District of Columbia entitled In Re Vitamins Antitrust Litigation, MDL No. 1285, Misc.
No. 99-0197, and all facts and circumstances at issue therein), the U.S. Borrower shall make, or cause to be made, a mandatory prepayment of the Loans in the amount of such Proceeds
(with such prepayment being applied to the remaining Term Loan amortization payments pro rata in accordance with the amount of each such remaining Term Loan amortization payment) and the cash
collateralization of all Letters of Credit and a corresponding reduction of each Revolving Loan Commitment Amount. The Borrowers reaffirm and ratify the perfected security interest in the Claims and
Proceeds of the Agents and the Lenders. 

    (p)  Restructuring.  The Borrowers will, (i) on or before July 16,
2001, deliver to the Agents and to CBW a draft of an update to their June 13 business plan reflecting actual results of April, May and June 2001,
(ii) on or before July 23, 2001, deliver to the Agents and to CBW a final updated business plan which shall be in form and scope substantially similar to the June 13, 2001
business plan previously delivered to CBW but which shall include a monthly breakdown of financial projections for fiscal years 2002 and 2003, (iii) on or before July 31, 2001, deliver
to the Agents and to CBW an estimate and analysis of the Borrowers' enterprise value and debt capacity based on the revised business plan and (iv) on or before August 15, 2001, deliver
to the Agents a written proposal for a restructuring (a "Restructuring") of the Borrowers' indebtedness and liabilities. The Borrowers will pay to the
Agents for the pro rata benefit of the Consenting Lenders a fee of $100,000 in the event the Borrowers fail to comply with any of the deadlines in clauses (ii), (iii) and (iv). For avoidance of
doubt, a fee of $200,000 will be payable if the Borrowers fail to comply with two of the foregoing deadlines and a fee of $300,000 will be payable if the Borrowers fail to comply with all three
deadlines. The Borrowers agree to continue to negotiate a Restructuring in good faith with the Agents and the Lenders. 

5

 

    (q)  Chief Operating Officer.  The U.S. Borrower agrees to, (i) on or
before August 31, 2001, identify and deliver to the Agents a list of candidates for the position of chief operating officer of the U.S. Borrower (the
"COO") and (ii) hire a COO who shall be reasonably satisfactory to the Agents and use good faith efforts to complete such hiring on or before
September 28, 2001. The Borrowers shall provide the Agents and CBW with access to the executive search firm retained in connection with the COO search process and will direct such firm to fully
cooperate with the Agents and CBW regarding all reasonable requests for information or documentation in connection therewith. The Borrowers will continue to work in good faith with the Agents and
their professionals to refine the description of the required qualifications, capabilities, role and authority of the COO position. 

    (r)  Severance Agreements.  The Borrowers shall not enter into any severance
agreement (a "Severance Agreement") with, or similar arrangement providing for the payment of money or other consideration (a
"Severance Payment") to, any current or former employee in connection with the termination (under any circumstances) of such employee's employment with
a Borrower without the Agents' prior written consent, which shall not be unreasonably withheld or delayed, provided that a Borrower may enter into a
Severance and Release Agreement (a "Release") which is contemplated by and executed in connection with a Severance Agreement existing on the date hereof, so long as such Release does not expand the
rights of any employee under the related Severance Agreement. The Borrowers will promptly deliver to the Agents copies of Severance Agreements for all current employees and all Releases reasonably
requested by the Agents or CBW and will not make any Severance Payments or enter into any Release without first providing 5 Business Days' prior written notice to the Agents. The Borrowers will not
make any discretionary non-contractual Severance Payments without the Agents' prior written consent. 

    (s)  Net Disposition Proceeds.  The Borrowers agree that notwithstanding anything
to the contrary contained in the second sentence of the definition of "Net Disposition Proceeds" in the Credit Agreement, Net Disposition Proceeds shall exclude only an aggregate amount equal to
$500,000 of proceeds of Permitted Dispositions received on or after July 1, 2001 through and until the termination of the Forbearance Period,  provided that the proceeds of (i) any Permitted
Disposition resulting in proceeds of less than $50,000 and (ii) the sale of Obsolete
Inventory (as defined below), shall also be excluded from
Net Disposition Proceeds and shall not be counted toward the $500,000 basket. "Obsolete Inventory" shall mean inventory for which the U.S. Borrower took
an inventory reserve for Fiscal Year 2001 or which comprises part of a discontinued product line, other than inventory transferred in connection with a sale of all of the stock, all or substantially
all of the assets, or a division or other similar operating or administrative unit of a Borrower or a Subsidiary or Affiliate of a Borrower. Commencing in August 2001, as part of the second
weekly rolling cash flow forecast for any month, the U.S. Borrower shall deliver to the Agents, with respect to the prior month, a report certified by David Coles, of the sales value, standard cost
and inventory reserve associated with the Obsolete Inventory sold in such month. 

    (t)  Continued Compliance with Loan Documents.  Each of the Borrowers will
continue to comply with all of its covenants and other obligations under the Credit Agreement and the other Loan Documents. 

The
provisions contained in paragraphs (a), (c), (d), (f), (i), (o), (r) and (s) above shall continue to and including the date of termination of the Forbearance Period (and shall
terminate on such date) and the provisions contained in paragraphs (b), (e), (g), (h), (j), (k), (l), (m), (n), (p), (q) and (t) shall survive termination of the Forbearance Period.
Nothing in this Agreement, including paragraph 4(s) or the termination thereof, shall prejudice or otherwise affect the right of any party to argue that the sale of Obsolete Inventory by a
Borrower does or does not constitute a Permitted Disposition or that the proceeds of any such sale do or do not constitute Net Disposition Proceeds, and no party shall assert in 

6

 

any proceeding or other context that terms of paragraph 4(s) or the termination thereof are relevant to any such argument. 

    Section 5.  Effect and Construction of
Agreement.  Except as expressly provided herein, the Credit Agreement and the other Loan Documents shall remain in full force and effect in accordance with their
respective terms, and this Agreement shall not be construed to: 

    (a) impair
the validity, perfection or priority of any Lien or security interest securing the Obligations; 

    (b) waive
or impair any rights, powers or remedies of any Agent or any Lender under the Credit Agreement or any other Loan Document upon termination of the Forbearance
Period, with respect to the Existing Defaults or otherwise; 

    (c) constitute
an agreement by any Agent or any Lender or to require any Agent or any Lender to extend the Forbearance Period, or grant additional forbearance periods,
or extend the term of the Credit Agreement or the time for payment of any of the Obligations; or 

    (d) require
any Lender to make any Loans or other extensions of credit to the Borrower. 

In
the event of any inconsistency between the terms of this Agreement and the Credit Agreement or any of the other Loan Documents, this Agreement shall govern. The Borrowers acknowledge that they have
consulted with counsel and with such other experts and advisors as they have deemed necessary in connection with the negotiation, execution and delivery of this Agreement. This Agreement shall be
construed without regard to any presumption or rule requiring that it be construed against the party causing this Agreement or any part hereof to be drafted. 

    Section 6.  Reference to and Effect on the Loan
Documents.  

    (a) Upon
the effectiveness hereof, each reference in the Credit Agreement to "this Agreement," "hereunder," "hereof" or words of like import referring to the Credit
Agreement, and each reference in the other Loan Documents to the Credit Agreement, "thereunder," "thereof" or words of like import referring to the Credit Agreement, shall mean and be a reference to
the Credit Agreement, as amended hereby. 

    (b) This
Agreement shall be a Loan Document. 

    Section 7.  Miscellaneous.  

    (a)  Further Assurances.  The Borrowers agree to execute such other and further
documents and instruments as the Agents may request to implement the provisions of this Agreement. 

    (b)  Benefit of Agreement.  This Agreement shall be binding upon and inure to the
benefit of and be enforceable by the parties hereto and their respective successors and assigns. No other person or entity shall be entitled to claim any right or benefit hereunder, including, without
limitation, the status of a third-party beneficiary of this Agreement. 

    (c)  Integration.  This Agreement, together with the Credit Agreement and the
other Loan Documents, constitutes the entire agreement and understanding among the parties relating to the subject matter hereof, and supersedes all prior proposals, negotiations, agreements and
understandings relating to such subject matter. In entering into this Agreement, the Borrowers acknowledge that they are relying on no statement, representation, warranty, covenant or agreement of any
kind made by any Agent, any Lender or any employee or agent of any Agent or any Lender, except for the agreements of the Agents and the Lenders set forth herein. 

    (d)  Severability.  The provisions of this Agreement are intended to be
severable. If any provision of this Agreement shall be held invalid or unenforceable in whole or in part in any jurisdiction, such provision shall, as to such jurisdiction, be ineffective to the
extent of such 

7

 

invalidity or enforceability without in any manner affecting the validity or enforceability of such provision in any other jurisdiction or the remaining provisions of this Agreement in any
jurisdiction. 

    (e)  Counterparts; Telecopied Signatures.  This Agreement may be executed in any
number of counterparts and by different parties to this Agreement on separate counterparts, each of which, when so executed, shall be deemed an original, but all such counterparts shall constitute one
and the same agreement. Any signature delivered by a party by facsimile transmission shall be deemed to be, and effective as, an original signature hereto. 

    (f)  Notices.  Any notices with respect to this Agreement shall be given in the
manner provided for in Section 12.2 of the Credit Agreement. 

    (g)  Survival.  Except as otherwise provided herein, all representations,
warranties, covenants, agreements, undertakings, waivers and releases of the Borrowers contained herein shall survive the termination of the Forbearance Period. 

    (h)  Amendment.  No amendment, modification, rescission, waiver or release of any
provision of this Agreement shall be effective unless the same shall be in writing and signed by the parties hereto. 

    Section 8.  RELEASE OF CLAIMS.  EACH OF THE
BORROWERS HEREBY ACKNOWLEDGES AND AGREES THAT IT DOES NOT HAVE ANY DEFENSES, COUNTERCLAIMS, OFFSETS, CROSS-CLAIMS, CLAIMS OR DEMANDS OF ANY KIND OR NATURE WHATSOEVER THAT CAN BE ASSERTED TO REDUCE OR
ELIMINATE ALL OR ANY PART OF THE LIABILITY OF THE BORROWERS TO REPAY ANY AGENT OR ANY LENDER AS PROVIDED IN THE CREDIT AGREEMENT AND THE OTHER LOAN DOCUMENTS OR TO SEEK AFFIRMATIVE RELIEF OR DAMAGES
OF ANY KIND OR NATURE FROM ANY AGENT OR ANY LENDER. EACH OF THE BORROWERS HEREBY VOLUNTARILY AND KNOWINGLY RELEASES AND FOREVER DISCHARGES THE AGENTS AND THE LENDERS, AND EACH AGENT'S AND LENDER'S
PREDECESSORS, AGENTS, EMPLOYEES, CONSULTANTS, ADVISORS, ATTORNEYS, SUCCESSORS AND ASSIGNS, FROM ALL POSSIBLE CLAIMS, DEMANDS, ACTIONS, CAUSES OF ACTION, DAMAGES, COSTS, EXPENSES, AND LIABILITIES
WHATSOEVER, KNOWN OR UNKNOWN, ANTICIPATED OR UNANTICIPATED, SUSPECTED OR UNSUSPECTED, FIXED, CONTINGENT, OR CONDITIONAL, AT LAW OR IN EQUITY,
ORIGINATING IN WHOLE OR IN PART ON OR BEFORE THE DATE THIS AGREEMENT IS EXECUTED, WHICH THE BORROWERS MAY NOW OR HEREAFTER HAVE AGAINST ANY SUCH AGENT OR LENDER, AND SUCH AGENT'S OR LENDER'S
PREDECESSORS, AGENTS, EMPLOYEES, CONSULTANTS, ADVISORS, ATTORNEYS, SUCCESSORS AND ASSIGNS, IF ANY, AND IRRESPECTIVE OF WHETHER ANY SUCH CLAIMS ARISE OUT OF CONTRACT, TORT, VIOLATION OF LAW OR
REGULATIONS, OR OTHERWISE, INCLUDING, WITHOUT LIMITATION, THE EXERCISE OF ANY RIGHTS AND REMEDIES UNDER THE CREDIT AGREEMENT OR OTHER LOAN DOCUMENTS, AND NEGOTIATION AND EXECUTION OF THIS AGREEMENT. 

    Each
of the Borrowers acknowledges and agrees that it understands the meaning and effect of Section 1542 of the California Civil Code which provides: 

"A
general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected
his settlement with the debtor." 

EACH
OF THE BORROWERS AGREES TO ASSUME THE RISK OF ANY AND ALL UNKNOWN, UNANTICIPATED OR MISUNDERSTOOD DEFENSES, CLAIMS, CONTRACTS, 

8

 

LIABILITIES, INDEBTEDNESS AND OBLIGATIONS WHICH ARE RELEASED, WAIVED AND DISCHARGED BY THIS AGREEMENT. EACH OF THE BORROWERS HEREBY WAIVES AND RELINQUISHES ALL RIGHTS AND BENEFITS WHICH IT MIGHT
OTHERWISE HAVE UNDER THE AFOREMENTIONED SECTION 1542 OF THE CALIFORNIA CIVIL CODE OR ANY SIMILAR LAW, TO THE EXTENT SUCH LAW MAY BE APPLICABLE, WITH REGARD TO THE RELEASE OF SUCH UNKNOWN,
UNANTICIPATED OR MISUNDERSTOOD DEFENSES, CLAIMS, CONTRACTS, LIABILITIES, INDEBTEDNESS AND OBLIGATIONS. TO THE EXTENT THAT SUCH LAWS MAY BE APPLICABLE, EACH OF THE BORROWERS WAIVES AND RELEASES ANY
RIGHT OR DEFENSE WHICH IT MIGHT OTHERWISE HAVE UNDER ANY OTHER LAW OF ANY APPLICABLE JURISDICTION WHICH MIGHT LIMIT OR RESTRICT THE EFFECTIVENESS OR SCOPE OF ANY OF THEIR WAIVERS OR RELEASES
HEREUNDER. 

    Section 9.  GOVERNING LAW; JURISDICTION; WAIVER OF JURY
TRIAL.  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK. THE JURISDICTIONAL, VENUE AND SERVICE
OF PROCESS PROVISIONS IN SECTION 12.14 OF THE CREDIT AGREEMENT AND THE JURY TRIAL WAIVER IN SECTION 12.15 OF THE CREDIT AGREEMENT SHALL APPLY TO ANY SUIT, ACTION OR PROCEEDING RELATED TO THIS
AGREEMENT. 

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

	 	 	LEINER HEALTH PRODUCTS INC.
	 	 	 	 	 
	

 	
 	

By:	
 	

 Name:

Title
	 	 	 	 	 
	

 	
 	
VITA HEALTH PRODUCTS INC.
	 	 	 	 	 
	

 	
 	

By:	
 	

 Name:

Title

9

 

AGREED TO AND ACCEPTED

AS OF THE DATE FIRST

ABOVE WRITTEN: 

THE
BANK OF NOVA SCOTIA

As Canadian Agent and a Lender 

	

By:	
 	

 Name:

Title

	

 

10

 

AGREED TO AND ACCEPTED

AS OF THE DATE FIRST

ABOVE WRITTEN: 

THE
BANK OF NOVA SCOTIA,

as the U.S. Agent and a Lender 

	

By:	
 	

 Name:

Title

	

 

11

QuickLinks

Exhibit 4.34

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