Document:

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                          LICENSE AND SUPPLY AGREEMENT

         This Supply Agreement, dated as of the 31st day of March 2000, is
between VIVIER-REGISTERED TRADEMARK- PHARMA INC., a Quebec, Canada
corporation incorporated under the laws of Canada with offices at 2689
Carriage Way, St-Lazare, Quebec Canada J7T 2B1 ("Vivier"), and OBAGI MEDICAL
PRODUCTS, INC., a corporation incorporated under the laws of California, with
offices at 310 Golden Shore, Long Beach, CA 90802 ("Buyer").

         WHEREAS Vivier manufactures and markets or will market various types of
dermatological products throughout North America and potentially in other
countries under its Vivier label and trademarks;

         WHEREAS, Buyer wishes to purchase Vitamin-C 5%, and Vitamin-C 10% under
its OMP, Inc. label (hereinafter, the "Products") from Vivier; and

         WHEREAS, Vivier is willing to supply the Products to Buyer for resale
under the Buyer's label upon the terms and conditions set forth herein;

         NOW, THEREFORE, the parties hereto agree as follows:

1.       DEFINITIONS

             (a) The following terms shall have the meanings set forth or
where indicated, below for purposes of this Agreement:

         "ACT" means the Federal Food, Drug and Cosmetic Act, as amended from
time to time.

         "AFFILIATE" of any person shall mean any corporation or other business
entity which, directly or indirectly, controls, is controlled by, or is under
common control with, such person. For purposes of this definition, the term
"control" (as used in the terms "controls," "controlled by," and "under common
control with") means either (a) holding fifty percent (50%)or more of the
outstanding voting securities of an issuer or (b) in the case of an entity that
has no outstanding voting securities, having the right to fifty percent (50%)or
more of the profits of the entity, or having the right in the event of
dissolution to fifty percent (50%)or more of the assets of the entity.

         "BUYER INDEMNIFIED PARTIES" shall have the meaning given thereto in
Section 14.2 hereof.

         "COMMENCEMENT DATE" means the date of the execution of this agreement
by the parties.

         "CONTRACT YEAR" means each consecutive 12-month period commencing on
the Commencement Date and each one year anniversary thereof.

         "FDA" means the United States Food and Drug Administration.

         "FORMS" shall have the meaning given thereto in Section 23.3 hereof.

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         "GMP" means current good manufacturing practices as defined from time
to time in Section 501(a)(2)(B) of the Act and the applicable rules and
regulations of the FDA.

         "INITIAL TERM" shall have the meaning given hereto in Section 15
hereof.

         "ORDER DATE" shall have the meaning given thereto in Section 5.3
hereof.

         "PROCEDURES" shall have the meaning given thereto in Section 4.8
hereof.

         "PRODUCTS" shall have the meaning set forth in the recitals to this
Agreement.

         "Specifications" the specifications of the Products listed in
Schedule F.

         "TERRITORY" means the United States in the physician-dispensed channel
of distribution; and for all channels of distribution in thecountries set forth
on Schedule E.

         "TPP" means the Canadian Therapeutics Products Programme.

         "Trademarks / Patents" means the trademarks / patents listed in
Schedule D and such other trademarks, trade names or identifying marks to be
used in association with the Product hereunder, which are all owned by Vivier.

         "VIVIER INDEMNIFIED PARTIES" shall have the meaning given thereto in
Section 14.1 hereof.

2.       PURCHASE AND SALE; LICENSE

         2.1 During the term of this Agreement, and subject to the provisions
hereof, Vivier agrees to supply to Buyer, all of Buyer's requirements for the
Products. All orders for the Products shall be made pursuant to written purchase
orders delivered to Vivier in accordance with Section 4 hereof. All purchase
orders from Buyer shall be in multiples of full batch sizes commonly used in
routine production of the Products. Minimum batch sizes are set forth on
Schedule A. The parties reserve the right to negotiate modified minimum batch
sizes on mutually agreeable terms and conditions.

         2.2 Vivier hereby grants to Buyer the exclusive right to market, sell,
and distribute the Products in the Territory and in the specified channels of
distribution and OMP agrees to distribute the Products under the OMP label or
such other labels owned or controlled by Buyer on an exclusive basis.

         2.3 The Buyer shall not, during the term of this agreement, sell the
Products to customers in the United States other than prescribing / dispensing
physicians, knowingly sell the Products in the Territory for resale outside the
Territory, (in particular Canada) nor buy from anyone other than Vivier or
develop or manufacture itself the Products or any other product which is
substantially the same as the Products during the five (5) year contract.

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         2.4 Vivier retains the right to sell the Products under its label and
trademarks in Canada and other than through the physician-dispensed channel of
distribution, in the United States. Vivier retains the right to sell the
Products under its label and trademarks in the United States through the retail
drug stores, spas, and beauty salons channel of distribution.

         2.5 If Vivier fails to deliver any of the Products in the quantities
requested by Buyer within thirty (30) business days of the date of delivery as
specified in a purchase order, then Buyer shall have the right to cancel the
amount of the purchase order which is unfulfilled, and obtain the unsupplied
quantity of such equivalent Products from any other manufacturer. In such event,
Vivier shall pay to Buyer the difference between the contract price and Buyer's
actual cost of such replacement product (subject to the obligation of Buyer to
reasonably mitigate its damages). Said right shall apply only to the extent that
such purchase order is unfulfilled. A purchase order shall be deemed filled and
closed if (a) Buyer orders full minimum batch sizes and Vivier delivers the
appropriate number of full batches or (b) the quantity of Products delivered is
within ten percent (10%) of the quantity ordered. In no event shall Buyer be
required to pay for any quantities not actually delivered.

         2.6 Appropriate supply lead times will be established (once final
labels and packaging are approved for printing by the Buyer) in excess of 120%
of the minimum annual purchase quantities set forth in Section 3, which will be
mutually agreed to by both parties.

         2.7 Buyer agrees to review with Vivier its sales by country for those
countries specified on Schedule E within 60 days of the end of each Contract
Year. In the event that Buyer has not established sales in any country specified
on Schedule E by the end of the first Contract Year, Buyer's exclusivity and
distribution rights under this agreement with respect to such country shall
automatically terminate.

         2.8 Vivier hereby grants to Buyer the right of first offer to
distribute its Vitamin-C 10% plus Hydroquinone 4% product, upon release of such
product from stability testing. In the event that Buyer exercises its right of
first offer hereunder, such product shall be deemed incorporated in the
definition of Products under this agreement, and the parties shall agree on
minimums in addition to those specified in Section 3.

3.       BUYER PRODUCT COMMITMENTS

         3.1      First Contract Year
a) During the first Contract Year, Buyer hereby agrees to purchase the following
minimum quantities for delivery in the first Contract Year:

                  1)  For the US, a total of [***] units in the aggregate of
                      the Vitamin-C 5% Eye Contour Serum 15 ml and Vitamin-C 10%
                      High Potency Serum - 30 ml.
                  2)  For the 4 Country Groups and countries specified on
                      Schedule E, a total of [***] units in the aggregate of
                      the Vitamin-C 5% Eye Contour Serum - 15 ml and Vitamin-C
                      10% High Potency - 30 ml.
                  3)  The Buyer shall provide Vivier with an opening purchase
                      order for [***] units of Vitamin-C 5% Eye Contour Serum
                      15 ml and [***] units of Vitamin-C High Potency 30 ml
                      within five (5) working days from the

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[***] Material has been omitted pursuant to a request for confidential
      treatment and such material has been filed separately with the
      Securities and Exchange Commission.

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                      Commencement Date. Failure to issue the purchase order
                      shall not relieve the Buyer from any liability for these
                      quantities.
                  4)  The Buyer agrees to pay Vivier a deposit equal to [***]%
                      of the value of the first (opening) order upon submission
                      of the purchase order to Vivier, and the balance thirty
                      days (30) after shipment. Vivier agrees to apply this
                      deposit only toward the procurement of materials, supplies
                      and packaging related to Buyer's order. In return for
                      making this payment, Vivier will grant to Buyer a discount
                      of [***]% from the unit prices shown in Schedule B or from
                      Schedule C.
                  5)  Buyer will provide to Vivier, at its own cost and expense,
                      and approved by the Buyer final artwork and packaging
                      design for the Products.

         3.2 Subsequent Contract Years

         a) For the second through to the fifth contract year, Buyer agrees to
purchase a minimum quantity equal to [***]% of the total minimum quantities in
effect for the preceding Contract Year.

         b) In order for the Buyer to maintain exclusivity of the Products in
the Territory, the Buyer agrees to purchase the minimum annual quantities for
the US and for the Country Groups and countries set forth on Schedule E as set
forth in Sections 3.1 and 3.2, respectively, and under the terms set forth in
this Agreement. If the Buyer fails to meet the minimum annual quantities as set
forth in Sections 3.1 and 3.2, the Buyer's exclusivity right in the US and/or
the Country Groups and countries set forth on Schedule E, respectively, will
automatically revert to Vivier.

4.       PRICE; PAYMENT, MARKETING RESPONSIBILITY; MISCELLANEOUS TERMS AND
         CONDITIONS OF SALE

         4.1 (a) The transfer price payable by Buyer for the Products shall be
as set forth in Schedule B attached hereto (the "Transfer Price") or as set
forth in Schedule C attached hereto ("Annual Unit Volume Transfer Price and
Discounts").

         4.2 (a) Buyer shall bear the cost of any sales taxes of any kind,
nature or description whatsoever applicable to the sale of any Product sold by
Vivier to Buyer and Buyer shall forthwith pay to Vivier all such sums upon
demand unless Buyer is exempt therefrom and, as evidence thereof, provides to
Vivier, at the time of the submission of its order to Vivier, with tax exemption
certificates or permits acceptable to the appropriate taxing authorities.

             (b) Shipping terms shall be F.O.B. Vivier's Montreal area,
Quebec location. All freight and shipping charges and all other taxes, custom
duties or fees, storage, handling, insurance and other charges relating to
the Product shall be paid by the Buyer. Vivier may increase its sale price of
the Product proportionately to the increase in the Canadian Consumer Price
Index as published by Statistics Canada, taking the month in which this
agreement is executed for a reference. The increase shall be effective the
beginning of each Contract Year.

             (c) All payments to Vivier hereunder shall be in US dollars.

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[***] Material has been omitted pursuant to a request for confidential
      treatment and such material has been filed separately with the
      Securities and Exchange Commission.

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         4.3 Each release of Product for shipment to Buyer shall constitute a
separate sale, obligating Buyer to pay therefor, subject to the terms of this
agreement, whether said shipment is in whole or only partial fulfillment of any
order or confirmation issued in connection therewith. Vivier agrees to invoice
each separate shipment on a separate invoice.

         4.4 (a) Vivier shall issue its invoice to Buyer at the time of
shipment. Payments for Product sold hereunder shall be made by Buyer to Vivier
within thirty (30) days after date of invoice, terms net 30 days or 2% net 15
days by check or, at the discretion of Vivier, by electronic transfer. The
correct purchase order number will be quoted on all invoices. All overdue
amounts shall collect interest at the prime rate of Vivier's bank plus 2% but
never less than 12% per annum, calculated daily

             (b) Subject to Section 5.1 hereof, all payments shall be in
the full amount stated in each invoice, without any setoffs, deductions or
withholdings of any kind, except that payment shall not be required to the
extent that Buyer reasonably determines that it has the benefit of a credit
relating to any previously issued invoice and follows the procedures set forth
in the remainder of this Section 3.4(d). Buyer shall not make any such deduction
or set off against amounts owed to Vivier, without first providing thirty (30)
days written notice to Vivier of the existence of a dispute. Such written notice
shall include enough detail to enable Vivier to evaluate the claim, including
but not limited to, a description of the type of claim (i.e., pricing, rebate,
shortage claim) as well as the relevant items, prices, quantities, relevant time
period. The parties agree to negotiate in good faith to resolve any such
dispute.

         4.5 Buyer shall be responsible for all marketing, distribution, and
related costs incurred by it in connection with its sale of the Products within
the Territory.

         4.6 (a) The parties shall cooperate to develop mutually acceptable
procedures to ensure compliance with applicable advertising and promotion
regulations.

         (b) Buyer represents, warrants and covenants that all marketing,
labeling, sale and distribution shall be in accordance with local laws and
regulations.

         4.7 Buyer shall not use, or claim any right or license with respect to,
any trademark, trade name, service mark or logo of Vivier, and Vivier shall not
use, or claim any right or license with respect to, any trademark, trade name,
service mark or logo of Buyer.

         4.8 To the extent not otherwise covered in this Agreement, purchases of
Product hereunder will be made pursuant to Buyer's standard purchase order
procedures (the "Procedures"). Such Procedures may be modified from time to time
with the written consent of Vivier, which consent shall not unreasonably be
withheld. Notwithstanding the foregoing, it is understood that the provisions of
this Agreement shall control in the event of any conflict between such
provisions and Buyer's Procedures.

         4.9 a) In addition, to the transfer price payable by the Buyer for the
Products as set forth in Schedule B attached hereto (the "Transfer Price").
Vivier has agreed to provide to the Buyer with Annual Unit Volume Transfer
Prices and Discounts for the Vitamin-C 5% - 15 ml and for the Vitamin-C 10% - 30
ml as set forth in Schedule C attached hereto (the "Annual Unit Volume Transfer
Price and discounts"). These prices will be set at the commencement of the

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Contract Year and will be based on the Buyer's total committed annual unit
minimums for the Territory.

                  b) Should the Buyer exceed their total committed annual unit
minimums for the Territory and that their increased sales units of the said
Products qualifies them to benefit from a lower price range, Vivier, at its
option, will either remit to the Buyer a) a dollar credit and/ or b) free goods
for the difference in the price for the Products sold to and paid for by the
Buyer at the end of Contract Year. This credit would be remitted by Vivier to
the Buyer within 60 days of the close of the Contract Year and providing there
are no outstanding balances and no unforecasted unit sales i.e., intentional
loading by the Buyer unless otherwise mutually agreed to.

                  (c) Should the Buyer, given its projected quarterly and / or
annual unit forecasts, fail to meet its stated committed annual unit volumes and
have benefited or are benefiting from the lower unit price volumes, upon
Vivier's request, the Buyer agrees that it is obligated to pay Vivier for the
difference in the volume unit price it has received for the purchased Products
given its actual unit sales and as set forth in Schedule C attached hereto (the
"Annual Unit Volume Transfer Price and Discounts"). The Buyer agrees that it
will remit to Vivier within 60 days of the close of the Contract Year, or when
requested by Vivier, given the Buyer's known lower unit sales volumes and
forecasted unit volumes supplied to Vivier, the difference between what it has
paid for the purchased Products and the new price based on their actual annual
unit volume as set forth in Schedule C attached hereto (the "Annual Unit Volume
Transfer Price and Discounts").

5.       FORECASTS; SHIPMENTS; ORDERS

         5.1 In order to assist Vivier in planning its production runs for the
Products, the Buyer shall provide Vivier, at least five (5) days prior to the
beginning of each month, with a three (3) month rolling forecast of the
quantities of each Product required by Buyer, by month, for the following three
(3) months, together with the approximate dates upon which it will request the
deliveries of such Product be made. In addition, Buyer shall submit a forecast
for the succeeding three (3) months in quarterly estimates. It is understood
that such rolling forecasts are intended to be Buyer's estimates of its purchase
requirements; they shall not be binding upon either party. Notwithstanding the
foregoing, Buyer acknowledges that production and plant capacity planning will
be based on such forecasts Buyer shall be bound to purchase from Vivier 100% of
those quantities of Product set forth in any such forecast as being the
requirements of Products for the first three (3) months of the forecast.

         5.2 Vivier shall, within thirty (30) business days after receipt of
each such forecast notify Buyer of any prospective problems it might have in
respect of meeting Buyer's forecasted order quantities or estimated delivery
dates.

         5.3 Buyer shall provide Vivier with its firm orders for the Products
within the lead times set forth on Schedule A (which Schedule A describes
different lead times for different Products) and Vivier, within five (5)
business days after the date that an order is deemed placed with it (the "Order
Date"), shall acknowledge receipt of Buyer's order and confirm that the order
can be supplied. For purposes hereof, the Order Date shall be the earlier of (a)
the date that Vivier receives the order via mail or (b) the date of receipt of
the telecopied order.

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         5.4 For the opening order only, the Buyer agrees to grant Vivier a lead
time of up to 60 days (upon approval of the Buyer's final label and package
artwork, UPC bar code, etc.) to deliver the Products to the Buyer. Vivier agrees
to use its commercially reasonable efforts to deliver such order as soon as
possible.

         5.5 (a) Each order shall specify the quantity of Product ordered.
The order shall be delivered to such location as Vivier designates in writing
to Buyer from time to time. On or after the Order Date, Buyer will specify
individual shipment release dates for the quantities ordered. Subject to the
terms of the following sentence, Buyer is under no obligation to accept
shipments nor commence payment of invoices prior to the shipment release date.

             (b) Buyer shall provide Vivier with a list of approved carriers.
Vivier shall make all necessary shipping arrangements with a carrier listed
by Buyer as "approved" and shall deliver all orders to Buyer F.O.B. Buyer
delivery point.

             (c) When a shipment of Product is ready for delivery, Vivier
shall notify Buyer of the expected delivery dates (including, to the extent
applicable, details or port, date and time) to enable delivery and collection
to be coordinated.

             (d) Buyer shall be fully responsible for all final label and
packaging artwork provided to Vivier. Vivier shall review and approve such
final artwork. Any future modifications thereto to be included in the final
packaging production will be brought to the attention of the Buyer for final
approval and Vivier will supervise the final production runs.

             (e) Vivier shall purchase all materials and packaging components
for the Product. The Buyer understands that Vivier's 15 ml bottle products
are currently packaged in carton boxes of 30's and that the 30 ml bottle
products are packaged in carton boxes of 20's and shipped in master shippers
of 8 cartons.

             (f) Vivier agrees to properly pack, mark and ship the Product to
one (1) location designated by Buyer in boxes of twelve (12).

             (g) The Buyer agrees, given Vivier's current and standard
packaging, to: (1) pay for special or customized shipping and printing
plates, films for labels for outer boxes and master shippers; (2) be
responsible for the labeling i.e., label specifications and copy (including
translation(s), and bear the cost of original artwork, print origination and
any subsequent amendments thereto, and of the final printing material (sticky
labels, insert and outer cartons); and (3) send to Vivier any revisions to
the finished artwork, translated if necessary, or films at least three (3)
months before the due date of each shipment, other than for the opening order.

6.       ALLOCATION OF SHORTAGES

         6.1 Subject to Section 2.5 hereof, Vivier shall not be required to
maintain an inventory of the Products and shall use reasonable efforts to supply
the Products according to the Buyer's purchase orders insofar as not prevented
or hindered by limitations of availability, production hold-ups, shortages of
raw materials or labor and the like. In the event of such

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happenings, Vivier shall notify the Buyer at the earliest possible time of
the impending delay or shortage. Vivier shall then allocate between its
customers (including its own requirements) and the Buyer its available supply
of Products in proportion to the respective quantity of Products purchased
from Vivier by each customer and by the Buyer during the preceding three
month period. Any shortages in supply to the Buyer relating to accepted
purchase orders shall reduce the Buyer's minimum purchase obligations by the
amount of the shortfall.

7.       INSPECTION OF SHIPMENTS

         7.1 Buyer shall inspect all Product delivered hereunder for defective
or adulterated Product within a reasonable period of time after receipt and
shall provide Vivier with written notice of any such defective or adulterated
Product within thirty (30) days of discovery of any defect of adulteration.
Defective or adulterated Products, excluding those Products suffering from
defects or adulteration as a result of shipper's action or failure to act, shall
hereinafter be referred to as, "Damaged Product." If within such thirty (30) day
period, Buyer notifies Vivier that in its opinion the defects or adulteration
are not as a result of shipper's action or failure to act, Buyer agrees to
review its results with Vivier's Quality Assurance Department to confirm the
existence of Damaged Product. Pending final determination of the existence of
Damaged Product, Buyer's obligation to pay for the Damaged Product shall be
suspended. Upon a determination that such product is or was not Damaged Product,
Buyer shall immediately pay to Vivier the full invoice price for such product.
If both parties agree that the shipment, or any part thereof, is Damaged
Product, then Vivier shall, at Buyer's option, (a) deliver replacement Product
to Buyer as soon as reasonably practical thereafter (but, in any event, within
ninety (90) days after the initial notification by Buyer) , (b) refund to Buyer
(by cash or credit) the purchase price paid by Buyer with respect to the amount
of Product which is determined to be Damaged Product or (c) cancel that portion
of the purchase order to the extent of the Damaged Product in which event Buyer
shall have no obligation to pay for such Damaged Product. If the parties
disagree as to the existence of a problem, they will then submit representative
samples of the shipment to a mutually acceptable independent testing lab and the
results of said lab shall be binding on the parties and the costs associated
with such submission shall be borne by the party against which the lab decides.

         7.2 (a) Notwithstanding any other provisions of this Agreement, Buyer
agrees, if so requested by Vivier, to return to Vivier, at Vivier's expense, any
Product that is, or is claimed to be, Damaged Product or otherwise to dispose of
such Product as Vivier may direct.

         7.3 Vivier's warranty shall not extend to the Products which have been
improperly stored or handled after loading on carrier.

8.       TRADE SECRETS AND CONFIDENTIALITY

         8.1 (a) Vivier or Buyer may, from time to time, disclose to the other
valuable information of a technical or nontechnical nature that is not generally
known to the trade or public. Each of Vivier and Buyer agrees that during the
period that this Agreement is in effect and for a period of five (5) years
thereafter, it will not disclose to anyone in any manner whatsoever (except as
authorized in writing by the other party) any such information

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("Confidential Information"), including, without limitation, intellectual
property, inventions, works of authorship, trade secrets or know-how or other
information relating in any way to the products, processes, and services of
such other party which becomes known to Vivier or Buyer, as the case may be,
during the period that this Agreement is in effect. The obligations of this
Section 6 shall not apply to information that (i) is known to a party as
shown by written records prior to the disclosure of such information by the
other party; (ii) becomes public information or is generally available to the
public other than by an unauthorized act or omission of a party; or (iii) is
received by a party from third parties who are in rightful possession of such
information and who are lawfully entitled to disclose such information to
such party.

                  (b) Upon termination of this Agreement, each of Vivier and
Buyer shall return to the other all materials and documents that include
Confidential Information of the other party, including all copies of such
materials and documents, and shall make no further use of such Confidential
Information.

         8.2 Each party agrees to advise those of its employees who receive any
other party's Confidential Information that such information (a) is proprietary
and confidential to such party and (b) shall not be disclosed to anyone except
as authorized by this Agreement or otherwise authorized by such party in
writing. Each party further agrees to take such precautions as it normally takes
with its own confidential and proprietary information to prevent unauthorized
disclosure of another party's Confidential Information.

         8.3 In the event that a party becomes legally compelled to disclose
another party's Confidential Information, it will provide such other party with
prompt advance notice in writing so that such other party may, at its
discretion, defend against such legal obligation, seek a protective order or
other appropriate remedy and/or waive compliance with the provisions of this
Section 6. In the event that such protective order or other remedy is not
obtained, a party will furnish only that portion of such other party's
Confidential Information which, it is advised by written opinion of counsel, is
legally required and will exercise its best efforts to obtain reliable assurance
that confidential treatment will be accorded such Confidential Information.

         8.4 Each party acknowledges that any unauthorized disclosure of any
portion of another party's Confidential Information shall cause irreparable
injury to such other party and that no adequate or complete remedy shall be
available to such other party to compensate for such injury. Accordingly, each
party hereby also acknowledges that such other party shall be entitled to
injunctive relief in the event of such unauthorized disclosure by a party or any
of its employees in addition to whatever remedies it might have at law.

9.       INTELLECTUAL PROPERTY

         9.1 Nothing in this agreement shall be construed as transferring to the
Buyer any right, title or interest in or to any patent, trademark, copyright,
design, proprietary information, process or know-how related to the Product and
which is the property of or controlled by Vivier.

         9.2 The Buyer agrees that its corporate name shall not include: a) the
Trademarks, the name of Vivier or any word confusingly similar thereto; or b)
any other trademark owned by Vivier.

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         9.3 The Buyer acknowledges that it has no proprietary interest in any
of the Trademarks, and Patents, that all such Trademarks and Patents are the
property of Vivier. The Buyer shall acquire no proprietary interest in them as a
result of such use and shall not at any time, whether during or after this
agreement, assert or claim any rights in any of the Trademarks and Patents.

10.      AUTHORIZATION AND REGISTRATIONS

         10.1 The Buyer shall comply with all regulatory requirements of the
Territory and obtain at its cost all necessary authorizations, licenses or
permits for the sale of the Products in the Territory, only to the extent Buyer
intends to sell the Products in such portion of the Territory. Vivier shall
provide any data concerning the Product which may be reasonably be required in
order to comply with applicable regulatory requirements.

         10.2 In the event that regulatory approval or registration is
compulsory in certain countries of the Territory in which Buyer intends to sell
the Products, Buyer shall apply for such registration in the name of the Buyer
and Vivier and take such steps as are reasonably necessary to acknowledge that
Vivier is the manufacturer, at its cost.

11.      MUTUAL REPRESENTATIONS AND WARRANTIES

         Each of the parties hereto represents and warrants to the other that:
(i) it is a corporation duly organized, existing, and in good standing in
accordance with the laws of its state of organization; (ii) it has all requisite
legal and corporate power and authority to enter into this Agreement; (iii) when
executed by the corporate officers whose names appear on the signature page
hereof, this Agreement shall be a valid and binding obligation of the parties
enforceable in accordance with its terms, subject to laws of general application
relating to bankruptcy, insolvency, and the relief of debtors; (iv) the
execution and delivery of this Agreement and consummation of the transactions
contemplated hereby will not constitute a breach or default under any other
agreement to which it is party or by which it is bound; (v) it will comply with
all applicable laws, rules and regulations in the conduct of its
responsibilities and activities under this Agreement.

12.      SAFETY AND HEALTH--RESPONSIBLE CARE

         12.1 From time to time Vivier may provide Buyer with safety and health
information, including, without limitation, warnings, material safety data
sheets, precautionary safety measures, and instructions on proper care, use and
handling, storage, and disposal of the Product. Buyer agrees to observe all
precautions and instructions provided by Vivier and to communicate all such
environmental, safety and health information to its employees.

         12.2 Buyer shall follow safe handling, storage, transportation, use,
and disposal practices with respect to the Product, including, but not limited
to, those required by federal, state, and local laws, regulations, and
ordinances and those set forth in the Responsible Care Codes of the Chemical
Manufacturers Association.

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         12.3 Vivier shall have the right to inspect Buyer's locations (in the
company of a Buyer representative) at reasonable times and upon reasonable
advance notice to determine Buyer's compliance with applicable laws and
regulations and with Vivier's instructions on proper care, use, handling,
storage and disposal of the Product.

13.      QUALITY OF THE PRODUCT

         13. 1 Vivier hereby warrants that no Product constituting or being a
part of any shipment made by Vivier pursuant hereto shall at the time of any
such shipment be adulterated or misbranded within the meaning of the Act or TPP,
or regulations promulgated thereunder, as such law or regulation is constituted
and in effect at the time of any such shipment. Notwithstanding the foregoing,
Vivier makes no misbranding representation with respect to Buyer's promotional
activities.

         13.2 The parties hereto agree to mutually cooperate with each other, as
required by pertinent provisions of the Act or TPP and the regulations
promulgated thereunder, in connection with any recalls, complaints or adverse
reactions relating to the Product manufactured and sold hereunder. In the event
of any recalls relating to the Product, all costs associated therewith shall be
borne by the party whose action or inaction causes such recall. For purposes of
this Section 13.2, the cost of any recall shall be deemed to be any
administrative and shipping expenses incurred by Buyer's customers and
reimbursed by Buyer, unless otherwise agreed in writing by the parties hereto.

         13.3 VIVIER HEREBY DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED,
INCLUDING ANY WARRANTY OF MERCHANTABILITY OR WARRANTY OF FITNESS FOR A
PARTICULAR PURPOSE. Except as otherwise specifically provided in this Agreement,
Buyer assumes all risks and liabilities whatsoever resulting from the
transportation, handling, storage, use and disposal of the Products, whether
used singly or in combination with other substances.

         13.4 (a) Product quality complaints received by the Buyer will be
forwarded upon receipt to a quality assurance representative to be designated by
Vivier. It is Vivier's responsibility to investigate these complaints or forward
such complaints to the manufacturer, if applicable, and to provide Buyer with a
follow-up report and required corrective actions, if any.

              (b) Adverse event reports received by the Buyer will be forwarded
upon receipt to Vivier's designated quality assurance representative. It is
Vivier's responsibility to fulfill its regulatory and reporting requirements
related to the adverse event reports.

14.      INDEMNIFICATION

         14.1 Subject to Sections 14.3 and 14.4 hereof, Buyer shall defend,
indemnify and hold harmless Vivier, its officers and directors, and its
successors and permitted assigns (collectively referred to as the "Vivier
Indemnified Parties"), from, against and in respect to any and all losses,
obligations, liabilities, penalties and damages (other than the Vivier
Indemnified Parties' consequential, incidental, special or indirect damages) and
reasonable costs and expenses which any of the Vivier Indemnified Parties may
incur or suffer in connection with any and all

                                                                        11 of 23

<PAGE>

deficiencies, actions (including, without limitation, any proceedings to
establish insurance coverage) and/or judgments, with which any of them may be
faced and which arise out of or are based upon third party claims or
investigations asserted or initiated against any of them arising from the
use, labeling, sale or marketing of the Product, except to the extent such
claims arise from (a) manufacturer and/or Vivier's failure (i) to meet the
manufacturing specifications contained in the Product's ANDA or (ii) to
manufacture and package the Product in compliance with the Act and TPP and
with the FDA's and TPP's GMP and other regulations promulgated under the Act.

         14.2 Subject to Section 14.4 hereof, Vivier shall defend, indemnify and
hold harmless Buyer, its officers and directors, and its successors and
permitted assigns (collectively referred to as the "Buyer Indemnified Parties"),
from, against and in respect of any and all losses, obligations, liabilities,
penalties and damages (other than the Buyer Indemnified Parties' consequential,
incidental, special or indirect damages) and reasonable costs and expenses which
any of the Buyer Indemnified Parties may incur or suffer in connection with any
and all deficiencies, actions (including, without limitation, any proceedings to
establish insurance coverage) and/or judgments with which any of them may be
faced and which arise out of or are based upon third party claims or
investigations asserted or initiated against any of them to the extent such
claims arise from manufacturer or Vivier's failure to manufacture and package
the Product in compliance with the Act and TPP and with the FDA's and TPP's GMPs
and other regulations promulgated under the Act and TPP. Vivier's
indemnification obligations under this Section 14.2 shall not be subject to the
limitation of liability set forth in Section 7.3 hereof.

         14.3 Without limiting its obligations under Section 10.2, Vivier shall
defend, indemnify, and hold harmless the Buyer Indemnified Parties from,
against, and in respect to any and all losses, obligations, liabilities,
penalties, damages, and reasonable costs and expenses which any of the Buyer
Indemnified Parties may incur or suffer in connection with any claim of
infringement of any patent or other proprietary right made against any of them
and based, in whole or in part, upon Buyer's activities properly undertaken
pursuant to this Agreement.

         14.4 The foregoing indemnification obligations of Vivier and Buyer are
subject to the following: (a) the indemnifying party is notified by or on behalf
of the indemnified party in writing promptly after a claim is made, a suit is
filed or an action or investigation is initiated (each, a "Proceeding") against
the indemnified party; (b) the indemnifying party is permitted to defend,
control, conduct and prosecute, in the indemnifying party's sole discretion and
by counsel of the indemnifying party's choosing, the defense of such Proceeding
brought against the indemnified party; (c) subject to the last sentence of this
Section 14.4, the indemnifying party has the right in its sole discretion to
settle, compromise or otherwise terminate the Proceeding and each of Vivier and
Buyer expressly agrees that the indemnifying party may do so in its name; (d)
the indemnified party shall refrain from settling any such Proceeding without
the indemnifying party's prior written consent; (e) the indemnified party shall
not compromise the position of the indemnifying party by admission, statements
or conduct in a way that could prejudice the defense, control, conduct or
prosecution of said cause of action; and (f) the indemnified party shall
cooperate with the indemnifying party in the defense, conduct, prosecution or
termination of the Proceeding, including the furnishing of information and the
assistance from employees of the indemnified party at the indemnifying party's
reasonable request and at no charge to the indemnifying party. Notwithstanding
anything in clause (c)

                                                                    12 of 23
<PAGE>

above to the contrary, no compromise or settlement of any Proceeding may be
effected by the indemnifying party without the indemnified party's consent
(which consent shall not be unreasonably withheld), unless, in connection
therewith, there is no finding or admission of any violation by the
indemnified party of (i) any law, rule or regulation or (ii) the rights of
any person.

         14.5 Promptly after receipt by a party of notice of the threat or
commencement of any Proceeding against it in respect of which indemnity may be
sought against the other party hereunder, the parties shall determine their
respective indemnification responsibilities under this Section 14. If the
parties are unable to agree, they shall retain an outside expert whose
determination in this regard shall be final and binding. If the parties are
unable to agree on an outside expert or such expert is unable to make a
determination as to the parties' respective indemnification responsibilities,
then such determination shall await the completion of the Proceeding. Pending
such completion, the parties shall conduct the defense of the Proceeding as
agreed between them. In any event, the determination by a court of competent
jurisdiction, with respect to the fault or responsibility of the parties, shall
be conclusive and binding for purposes of determining a right to indemnification
under this Article 14.

         14.6 a. Buyer and Vivier shall maintain during the performance of this
Agreement the following insurance or self-insurance in amounts no less than that
specified for each type:

                  i)       General liability insurance with combined limits of
                           not less than $[***] per occurrence and $[***] per
                           accident for bodily injury, including death, and
                           property damage; and

                  ii)      Product Liability Insurance with limits not less than
                           $[***].

         b.   Upon request, Vivier and Buyer shall each provide the other with
              evidence of its insurance or self insurance. Each party shall
              provide the other thirty (30) days prior written notice of any
              cancellation or change in its coverage.
         c.   Such insurance shall be underwritten with a responsible and
              reputable insurer.
         d.   Each of Vivier and Buyer's policies shall include the other as
              additional insureds as their respective interests may appear.

         14.7 UNDER NO CIRCUMSTANCES SHALL ANY PARTY BE LIABLE FOR ANY INDIRECT,
SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES OF THE OTHER, INCLUDING BUT NOT
LIMITED TO DAMAGES FOR LOST PROFITS OR INTERRUPTION OF BUSINESS ARISING OUT OF
OR RELATING TO THE SUPPLY OF PRODUCTS UNDER THIS AGREEMENT.

15.      TERM AND TERMINATION

         This Agreement shall commence on the Commencement Date and shall
continue in effect for five (5) years (hereinafter referred to as the "Initial
Term") and may be renewed thereafter upon mutual agreement between the parties.

16.      DEFAULT

                                                                    13 of 23

[***] Material has been omitted pursuant to a request for confidential
      treatment and such material has been filed separately with the
      Securities and Exchange Commission.

<PAGE>

          16.1 Either party may terminate this Agreement upon the giving of
prior written notice to the other party if the other party (a) has not fully
complied, in all material respects, with the terms and conditions hereof and (b)
fails to cure any such material noncompliance within forty-five (45) days after
receipt of such notice; in such event, this Agreement shall terminate effective
on the later of (a) the expiration of such forty-five (45) day period or (b) the
date specified in the written notice from the terminating party. In addition,
either party may terminate this Agreement with immediate effect upon giving
written notice to the other party in the event of insolvency, assignment for the
benefit of creditors, or bankruptcy proceedings by or against the other party.
In the event of termination by Buyer pursuant to this Section 16.1 as a result
of material breach by Vivier, and subject to the provisions of Section 4.4,
Vivier shall honor any purchase order accepted prior to the date notice of
termination is given. In the event of termination by Vivier pursuant to this
Section 16.1 as a result of Buyer's material breach, Buyer acknowledges and
agrees that Vivier shall be entitled to cancel any purchase order accepted prior
to the date notice of termination is given, and shall not be obligated to ship
any Product ordered by Buyer pursuant to such purchase order.

         16.2 The termination of this Agreement shall not release Buyer from the
obligation to pay any sum that may be owing to Vivier (whether then or
thereafter due to Vivier) or operate to discharge any liability that had been
incurred by either party prior to any such termination.

         16.3 During the period between the giving of any notice of termination
of this Agreement pursuant to this Section 16 and the effective date of
termination, all Product shall be delivered to Buyer solely on a C.O.D.
basis.

         16.4 Notwithstanding any termination of this Agreement, the provisions
of Section 4.6(b), and Articles 7, 8, 9, 12, and 14 shall remain in effect.

17.      FORCE MAJEURE

         17.1 Neither party shall be liable for any failure to deliver or
receive or any delay in delivery or receipt of any shipment when such failure or
delay shall be caused (directly or indirectly) by fire; flood; accident;
explosion, sabotage; strike, or any labor disturbance (regardless of the
reasonableness of the demands of labor); civil commotions; riots; invasions;
wars (present or future); acts, restraints, requisitions, regulations, or
directions of any governmental authority; voluntary or mandatory compliance by a
party with any request of any governmental authority, or any officer,
department, agency, or committee thereof; voluntary or mandatory compliance by a
party with any request for material represented to be for purposes of (directly
or indirectly) producing articles for national defense or national defense
facilities; shortage of labor, fuel, power or raw materials; inability to obtain
supplies; failures of normal sources of supplies; inability to obtain or delays
of transportation facilities; any act of God; or any cause (whether similar or
dissimilar to the foregoing) beyond the reasonable control of a party.

         17.2 Except as provided below, if a force majeure event occurs, then
the affected party's performance shall be excused and the time for performance
shall be extended for the period of delay or inability to perform due to such
occurrence. If, however, any such event shall

                                                                    14 of 23
<PAGE>

delay any shipment hereunder or the receipt thereof for more than thirty (30)
days beyond the scheduled delivery date, then (a) if such event is suffered
by Buyer and not also Vivier, Vivier shall have the right, at its option, to
cancel such shipment, and (b) if such event is suffered by Vivier and not
also Buyer, Buyer shall have the right to cancel its order and to purchase
from a third party the amount of Product ordered without incurring any
liability to Vivier with respect thereto. If any such disability exists for
more than ninety (90) days, the party not under such disability may terminate
this contract without liability to the other party by giving such other party
thirty (30) days' prior written notice of termination, and this Agreement
shall terminate on such thirtieth (30th) day unless prior thereto the force
majeure event ceases to exist and the party giving the notice of termination
is so notified in writing.

18.      ASSIGNMENT

         No party shall assign or otherwise transfer this Agreement or any
interest herein or any right hereunder without the prior written consent of the
other party, except that either party may, without the necessity for such
consent, assign this Agreement or any interest herein or any right hereunder, to
any of its Affiliates, or to any party which acquires a majority in interest of
Buyer's or Vivier's assets or capital stock. Any such purported assignment,
transfer, or attempt to assign or transfer any interest or right hereunder
except in compliance with this Section 13 shall be null, void and of no effect.

19.      WAIVER; SEVERABILITY

         19.1 Each party acknowledges and agrees that any failure on the part of
the other party to enforce at any time, or for any period of time, any of the
provisions of this Agreement shall not be deemed or construed to be a waiver of
such provisions or of the right of such other party thereafter to enforce each
an every such provision.

         19.2 The rights and remedies set forth herein shall be the exclusive
rights and remedies of the parties.

         19.3 If and to the extent that any provision of this Agreement is
determined by any legislature, court or administrative agency to be in whole or
in part invalid or unenforceable, such provision or part thereof shall be deemed
to be surplusage and, to the extent not so determined to be invalid or
unenforceable, each provision hereof shall remain in full force and effect
unless the purposes of this Agreement cannot be achieved. In the event any
provisions shall be held invalid, illegal or unenforceable the parties shall use
commercially reasonable efforts to substitute a valid, legal and enforceable
provision which insofar as practical implements the purposes hereof.

20.      GOVERNING LAW

         This Agreement shall be governed by, and construed in accordance with,
the internal laws of the State of California as though made and to be fully
performed in said State. Any proceeding to enforce or resolve disputes of any
nature arising under or relating to this Agreement shall be brought exclusively
before the courts of the State of California or of the United States of America
for the Central District of California.

                                                                    15 of 23
<PAGE>

21.      NOTICES

         All notices required or permitted hereunder shall be given in writing
and sent by facsimile transmission, or mailed postage prepaid by first-class
certified or registered mail, or sent by a nationally recognized express courier
service, or hand-delivered to the following addressees:

         Vivier:           Vivier-Registered Trademark- Pharma, Inc.
                           2689 Carriage Way
                           St-Lazare, Quebec J7T 2B1, Canada
                           Tel: 450-458-8633
                           Fax:  450.458.0033

                           Attention:  Jess Vivier, President & CEO

         Buyer:            Obagi Medical Products, Inc.
                           310 Golden Shore, First Floor
                           Long Beach, CA 90802
                           Fax: 562/628-1008
                           Attention:  Phillip J. Rose, President & CEO

or to such other address as may be specified in a notice given to the other
party in accordance with this Section. Any notice, if sent properly addressed,
postage prepaid, shall be deemed made three (3) days after the date of mailing
as indicated on the certified or registered mail receipt, or on the next
business day if sent by express courier service or on the date of delivery or
transmission (if delivered or sent during ordinary business hours, otherwise on
the next business day) if hand-delivered or sent by facsimile transmission.

22.      CAPTIONS

         The captions of each section of this Agreement are inserted only as a
matter of convenience and for reference and in no way shall be deemed to define,
limit, enlarge, or describe the scope of this Agreement and the relationship of
the parties hereto, and shall not in any way affect this Agreement or the
construction of any provisions herein.

23.      ENTIRE UNDERSTANDING; MODIFICATION

         23.1 This Agreement represents and incorporates the entire
understanding between the parties hereto with respect to the subject matter of
this Agreement, and each party acknowledges that there are no warranties,
representations, covenants or understandings of any kind, nature or description
whatsoever made by either party to the other, except such as are expressly
hereinabove set forth.

         23.2 Except with respect to the Exhibits and Schedules attached hereto,
which may be amended as provided elsewhere in this Agreement, this Agreement
shall not be subject to change

                                                                    16 of 23
<PAGE>

or modification except by the execution of a writing specified to be an
explicit amendment to this Agreement duly executed by both parties hereto.

         23.3 The parties recognize that, during the term of this Agreement, a
purchase order, acknowledgment form or similar routine document (collectively
"Forms") may be used to implement or administer provisions of this Agreement.
Therefore, the parties agree that the terms of this Agreement prevail in the
event of any conflict between this Agreement and the printed provisions of such
Forms, or typed provisions of Forms that add to, vary, modify or are at conflict
with the provisions of this Agreement.

24.      PARTIES' RELATIONSHIP

         Nothing in this Agreement shall create between the parties a
partnership, joint venture or principal-agent relationship and, for the
avoidance of doubt, each of Vivier and Buyer now confirms and accepts (for
itself and as agent on behalf of its Affiliates) that it is an independent
contractor trading for and on its own behalf.

25.      COUNTERPARTS

         This Agreement may be executed in two or more counterparts, each of
which shall constitute an original and all of which together shall constitute a
single instrument.

         IN WITNESS WHEREOF, the parties hereto by their duly authorized
officers have executed this Agreement as of the day and year first above
written.

VIVIER-Registered Trademark- PHARMA, INC.        OBAGI MEDICAL PRODUCTS, INC.

By: /s/ Jess Vivier                              By: /s/ Philip J. Rose
    ---------------------                            ---------------------------

Name:    Jess Vivier                             Name:    Philip J. Rose
        -----------------                                -----------------
Title:   President & CEO                         Title:   President & CEO
        -----------------                                -----------------
Date:    April 3, 2000                           Date:    March 30, 2000
        -----------------                                -----------------

                                                                    17 of 23
<PAGE>

                                   SCHEDULE A

                 LEAD TIMES, BATCH SIZES, AND EXPIRATION DATING

<TABLE>
<CAPTION>

------------------------------------- ------------------- -------------- ----------------------- -------------
Product Description                   Size                Lead time      Batch size              Exp. dating
------------------------------------- ------------------- -------------- ----------------------- -------------
<S>                                  <C>                 <C>            <C>                      <C>
Vitamin-C 5% Serum                    15 ml bottle        30 days        Batch is  4,000          14 months

------------------------------------- ------------------- -------------- ----------------------- -------------
Vitamin-C 10% Serum                   30 ml bottle        30 days        Batch is  4,000          14 months

------------------------------------- ------------------- -------------- ----------------------- -------------
Vitamin-C                             30 ml bottle        30 days        Batch is  2,000             TBD
10% + 4% HQ Serum
------------------------------------- ------------------- -------------- ----------------------- -------------

</TABLE>

                                                                    18 of 23
<PAGE>

                                   SCHEDULE B

                                 TRANSFER PRICE

<TABLE>
<CAPTION>

-------------------------------------- ------------------- -------------------------
Product Description                           Size              Transfer Price
                                                                 U.S. Dollars
-------------------------------------- ------------------- -------------------------
<S>                                   <C>                          <C>
Vitamin-C 5% Serum                     15 ml bottle                 $[***]

-------------------------------------- ------------------- -------------------------
Vitamin-C 10% Serum                    30 ml bottle                 $[***]

-------------------------------------- ------------------- -------------------------
Vitamin-C                              30 ml bottle                 $[***]
10% + 4% HQ Serum

-------------------------------------- ------------------- -------------------------

</TABLE>

                                                                    19 of 23

[***] Material has been omitted pursuant to a request for confidential
      treatment and such material has been filed separately with the
      Securities and Exchange Commission.

<PAGE>

                                   SCHEDULE C
                "ANNUAL VOLUME UNIT TRANSFER PRICE AND DISCOUNTS"

<TABLE>
<CAPTION>

---------------------------------------- --------------------------------------
             Annual Units                     % Volume Discount from Unit
                                               Prices Shown on Schedule B
---------------------------------------- --------------------------------------
<S>                                           <C>
       [***] to [***]                              [***]%
---------------------------------------- --------------------------------------
       [***] to [***]                              [***]%
---------------------------------------- --------------------------------------
       [***] to [***]                              [***]%
---------------------------------------- --------------------------------------
       [***] to [***]                              [***]%
---------------------------------------- --------------------------------------
       [***] to [***]                              [***]%
---------------------------------------- --------------------------------------
       [***] to [***]                              [***]%
---------------------------------------- --------------------------------------

</TABLE>

                                                                    20 of 23

[***] Material has been omitted pursuant to a request for confidential
      treatment and such material has been filed separately with the
      Securities and Exchange Commission.

<PAGE>

                                   SCHEDULE D

                          VIVIER PATENTS AND TRADEMARKS

1.       Vivier and logo is a registered trademark and copyright in the US and
         Canada.
2.       Vitamin-C IDS trademark is pending in the US.
3.       IDS and IntraDermal System is a registered trademark in Canada.
4.       Vitamin-C and Vitamin-C + Hydroquinone formulations are Patent Pending
         in the US and Canada.

                                                                    21 of 23
<PAGE>

                                   SCHEDULE E

                           INTERNATIONAL MARKETS HELD
                            EXCLUSIVELY FOR THE BUYER

<TABLE>
<CAPTION>

WESTERN EUROPE               ASIA                                  S. AMERICA           MIDDLE EAST
--------------               ----                                  -------------        -----------
<S>                         <C>                                   <C>                  <C>
France                       Taiwan                                Argentina            Saudi Arabia
UK                           Korea                                 Brazil               United Arab
Norway                       Philippines                           Colombia               Emirates
Sweden                       Australia                             Venezuela            Egypt
Denmark                      New Zealand                                                Israel
Benelux                      Singapore                                                  Lebanon
Germany                      Japan
Austria                      Peoples Republic of China
Switzerland                  Hong Kong
Italy
Spain

</TABLE>

                                                                    22 of 23
<PAGE>

                                   SCHEDULE F

                             PRODUCT SPECIFICATIONS

     Vitamin-C 5%

     - 15 ml glass amber bottle
     - L-Ascorbic Acid 5% USP
     - Water USP
     - Ethoxydiglycol EP
     - Propylene Glycol USP
     - Grapefruit Extract
     - Fragrance

     Vitamin-C 10%
     - 30 ml glass amber bottle
     - L-Ascorbic Acid 10% USP
     - Water USP
     - Ethoxydiglycol EP
     - Propylene Glycol USP
     - Grapefruit Extract
     - Fragrance

                                                                    23 of 23<PAGE>

                                                                 EXHIBIT 10.13

                              EMPLOYMENT AGREEMENT

May 14, 1999

Mr. Phillip J. Rose
5830 East Lavender Court
Orange, California 92867

Dear Phil:

         On behalf of the Board of Directors I am pleased to offer you the
position of President and Chief Executive Officer of Obagi Medical Products,
Inc. (the "Company") on the following terms:

         a.       DUTIES

         You will perform the duties customarily associated with this position
with respect to the Company's operations on a full-time basis, and will report
directly to the Chairman of the Board of Directors of the Company. You will be
based in Long Beach, California, or such other Southern California location,
which the Company establishes as its principal place of business, within a 50
mile radius of Long Beach.

         b.       EFFECTIVE PERIOD OF TERMS OF EMPLOYMENT

         The terms of your employment set forth herein shall be effective for a
period of two (2) years commencing no later than June 3, 1999, and the terms
shall be automatically renewed for successive one-year periods, subject to the
termination provisions set forth herein.

         c.       COMPENSATION

         SALARY: Your salary shall be $225,000 per annum. Your salary shall be
paid semi-monthly, subject to standard payroll deductions and withholdings.

         BONUS: You shall be entitled to an annual bonus based on the
achievement of certain benchmarks and in the amounts as set forth on Exhibit "A"
attached hereto. All bonuses will be subject to the standard payroll deductions
and withholdings and shall be paid not later than the end of the first fiscal
quarter of the following year. No bonus shall be due

                                                                    Page 1 of 9

<PAGE>

and owing unless you are employed by the Company on December 31 of the
applicable year.

         GUARANTEED BONUS: For the calendar year 1999 only, you will be
guaranteed to receive a minimum bonus of $4,166.77 for each month you are
employed by the Company in 1999 (the "Guaranteed Bonus"). Your prorated portion
of the Guaranteed Bonus shall be paid semi-monthly, subject to standard payroll
deductions and withholdings. For any partial month, you will be paid a pro rata
portion of $4,166.77 based on the number of days you were employed during such
month.

         STOCK OPTION GRANT: The Company hereby grants you stock options to
purchase 160,000 common shares of the Company (the "Options") as follows:

<TABLE>
<CAPTION>

        ------------------------------------------- --------------------- ---------------------------------
        Number of Stock Options                     Exercise Price        Vesting Period
                                                    per Share
        ------------------------------------------- --------------------- ---------------------------------
     <S>                                           <C>                   <C>
        80,000                                      $1.00                 16,000  shares  per  year on the
                                                                          1st,  2nd,  3rd,  4th,  and  5th
                                                                          anniversaries of your employment
        16,000                                      $1.38                 After 1 year of employment
        16,000                                      $1.85                 After 2 years of employment
        16,000                                      $2.44                 After 3 years of employment
        16,000                                      $3.17                 After 4 years of employment
        16,000                                      $4.07                 After 5 years of employment

</TABLE>

         The Options will be qualified incentive stock options and shall be
subject to and issued in accordance with the terms set forth on Exhibit "B"
attached hereto, including, but not limited to, the vesting schedule set forth
therein. The granting of the Options hereunder is conditioned upon the
requirement that you enter into a Buy Sell Agreement in the form of Exhibit "C"
attached hereto (the "Buy Sell Agreement") contemporaneously with your execution
of this Agreement. Any shares issued to you upon exercise of the Options shall
be subject to the Buy Sell Agreement.

                                                                    Page 2 of 9

<PAGE>

         RIGHT TO PURCHASE STOCK: In addition to the Options granted hereunder,
the Company grants you a one-time option to purchase shares of the Company's
common stock and Series B Preferred Stock as follows:

         (i)  Purchase Price.

                  Common Stock                       $0.50 per share
                  Series B Preferred Stock           $100 per share

         (ii)  Purchase Ratio

                  You shall be eligible to purchase 50 shares of the Company's
                  common stock for each share of Series B Preferred Stock
                  purchased. This purchase option may only be exercised in
                  accordance with this ratio.

         (iii)  Company Loan

                  In the event you exercise this purchase option, the Company
                  agrees to lend you fifty percent (50%) of the total purchase
                  price required to exercise this purchase option, as evidenced
                  by a note in the form of exhibit "D" attached hereto. The
                  terms of this loan shall be as follows:

                                    Term:            10 years

                                    Interest:        8.75% per annum

                                    Payment:         Interest on the Note shall
                                                     be due and payable on each
                                                     anniversary date of the
                                                     Note.

                                                     Principal shall be repaid
                                                     at maturity or, if earlier,
                                                     from the first proceeds
                                                     from any redemption or
                                                     disposition of the common
                                                     stock and/or Series B
                                                     Preferred Stock purchased
                                                     pursuant to this purchase
                                                     option.

                                    Security:        The Note shall be
                                                     non-recourse to you
                                                     individually and shall be
                                                     secured by the common stock
                                                     and Series B Preferred
                                                     Stock purchased pursuant to
                                                     this purchase option, which
                                                     security interest shall be

                                                                    Page 3 of 9

<PAGE>

                                                     evidenced by a Pledge
                                                     Agreement, in the form of
                                                     Exhibit "E" attached
                                                     hereto.

         (iv)  Expiration of Purchase Option

                  If you have not exercised the purchase option within 90 days
                  of the commencement date of your employment, the purchase
                  option granted hereunder shall terminate and be of no further
                  force and effect.

         (v)  Buy Sell Agreement

                  Any of the Company's common stock or Series B Preferred Stock
                  purchased by you pursuant to this purchase option shall be
                  subject to the terms of the Buy Sell Agreement.

         BENEFITS: You will be eligible for three weeks paid vacation per year,
health, dental, and all other benefits the Company provides, from time to time,
to its most senior employees, and to participate in the Company's 401(k) plan.

         CAR ALLOWANCE: You will receive $800 per month as a car allowance,
subject to the standard payroll deductions and withholdings, which you shall
apply to any and all vehicle operation, lease and/or purchase expenses.

         MOVING EXPENSE ALLOWANCE: The Company shall reimburse you for all
reasonable moving expenses incurred in relocating your family once in an amount
not to exceed $8,500.00

         d.       TERMINATION

         Subject to the Company's duty to pay your compensation as set forth in
this paragraph, either you or the Company may terminate your employment with or
without cause, at any time, for any reason whatsoever without advance notice.
This at-will employment relationship cannot be changed except by writing signed
by the Chairman of the Board of Directors of the Company.

         If the Company terminates your employment without cause, you will
receive as your sole severance, any bonus still owing from the previous year,
your base salary for the remaining balance of the period ending May 30, 2001,
payable semi-monthly, subject to standard payroll deductions and withholdings.
Any continuing payments shall cease immediately if you violate any provision of
this Agreement, including the

                                                                    Page 4 of 9

<PAGE>

provisions of Sections f, g, and h. If the Company exercises its right to
terminate your employment without cause, no compensation will be owed to you
other than the severance payment referred to in the previous sentence.

         If you voluntarily terminate your employment, if you die or become
physically or mentally disabled, as certified by a physician, or if the Company
terminates your employment for cause, all compensation and benefits shall cease
immediately, and you will receive no severance benefits except for any bonus
still owing from the previous year. For purposes of this Agreement, termination
for cause shall mean material misconduct, including, but not limited to (i)
conviction of any felony or any crime involving moral turpitude or dishonesty or
which is punishable by imprisonment in a state or federal correctional facility;
(ii) participation in a fraud or act of dishonesty against the Company or any of
its customers or suppliers; (iii) willful and material breach of this Agreement
or other Company policies; (iv) willful violation of reasonable rules,
regulations, orders or directives of the Company's Board of Directors; (v)
refusal to perform your duties on a full-time basis; (vi) conduct by you which
in the good faith and reasonable determination of the Board of Directors of the
Company demonstrates negligence, willful malfeasance or unfitness to serve,
(vii) conduct by you which would be considered harassment in violation of the
Company's policies or (viii) any other act or omission by you which is
materially injurious to the financial condition or the business reputation of
the Company.

         e.       POLICIES AND PROCEDURES

         You will be expected to abide by all Company policies and procedures.
The Company may issue policies, rules, regulations, guidelines, procedures or
other informational material, whether in the form of handbooks, memoranda, or
otherwise, relating to its employees. These materials are general guidelines for
your information and any changes in the Company's policies, rules, regulations,
guidelines, procedures or materials shall not be construed to alter, modify, or
amend this Agreement for any purpose whatsoever, and this Agreement shall
control over such policies, to the extent of any conflict.

         f.       CONFIDENTIALITY

         At any time following execution of this Agreement, you agree to hold as
a fiduciary of the Company and not to use or disclose, directly or indirectly,
for any reason, whatsoever or in any way any confidential information or trade
secrets of Company, including, but not limited to, information with respect to
Company as follows: the identity, lists and/or descriptions of any customers of
Company; financial statements,

                                                                    Page 5 of 9
<PAGE>

cost reports, or other financial information; product or service pricing
information; contract proposals and bidding information; processes, policies
and procedures developed as part of a confidential business plan; research;
secret data; processes; and management systems and procedures, including
manuals and supplements thereto, marketing data and plans intended for
internal use, other than (i) at the discretion of Company during the course
of your employment (ii) after receipt of the prior written consent of
Company, or (iii) as required by any court or governmental regulatory agency
having competent jurisdiction over Company. All records, files, memoranda,
reports, customer lists, drawings, plans, documents and the like that you
use, prepare or come into contact with during the course of your employment
with the Company shall remain the sole property of the Company and shall be
turned over to the Company upon termination of your employment with the
Company.

         You agree that all copyrights, trademarks, tradenames, service marks,
inventions, whether patentable or unpatentable, processes and other intangible
or intellectual property rights that may be invented, conceived, developed or
enhanced by you, whether alone or jointly with others, during the term of this
Agreement that relate to the Company's business, or that result from any work
performed by you for the Company, shall be disclosed to the Company and shall be
the sole property of the Company, and you hereby assign to the Company any right
or interest that you may otherwise have in respect thereof. Upon the reasonable
request of the Company, you shall execute, acknowledge, deliver and file any
instrument or document necessary or appropriate to give effect to this provision
and do all other acts and things necessary to enable the Company to exploit the
same or to obtain patents or similar protection with respect thereto. You agree
that the covenants set forth in this paragraph shall accrue to the benefit of
the Company, irrespective of the reason for termination of the other provisions
of this Agreement and the corresponding employment relationship created hereby.

         g.       NON-COMPETITION

         You agree that during the term of this Agreement and for a period of
two years thereafter, you will not, without the prior written consent of the
Company's Board of Directors:

                  (i) Whether for compensation or otherwise, directly or
indirectly engage in a Competitive Activity, as defined in Paragraph g.(iii), or
any part thereof, or assist any person in such person's conduct of the Company's
business, or any part thereof, whether as a director, officer, employee,
consultant, adviser, independent contractor or otherwise; or

                                                                    Page 6 of 9

<PAGE>

                  (ii) Hold a legal or beneficial interest in any person which
is engaged in the Company's business or any part thereof, whether such interest
is as an owner, investor, partner, creditor (other than as a trade creditor in
the ordinary course of business); joint venture or otherwise.

                  (iii) "Competitive Activity" is defined for purposes herein as
any business or other endeavor, in any county of any state of the United States
or a comparable jurisdiction in Canada or any other country, of a kind being
conducted by the Company as of the commencement date of your employment or at
any time thereafter through the date of termination of your employment.

         h.       NON-SOLICITATION

         You agree that during the term of this Agreement and for a period of
two years thereafter, you will not, without the prior written consent of the
Company's Board of Directors:

                  (i) Solicit, divert or attempt to divert from the Company or
any person deriving title to the goodwill of the Company (a "Transferee") any
business constituting, or any customer of, any part of the Company's Business,
conducted by the Company or such Transferee. "Company's Business" is defined for
purposes herein as any business or other endeavor, in any county of any state of
the United States or a comparable jurisdiction in Canada or any other country,
of a kind being conducted by the Company as of the commencement date of your
employment or at any time thereafter through the date of termination of your
employment; or

                  (ii) Induce or attempt to induce any person then, or during
the immediately preceding six (6) month period, engaged or employed (whether
part-time or full-time) by the Company or any Transferee, whether as an officer,
employee, consultant, salesman, adviser or independent contractor to leave the
employ of the Company or such Transferee, as the case may be, or to cease
providing the services to the Company or such Transferee, as the case may be,
then provided by such person, or in any other manner seek to engage or employ
any such person (whether or not for compensation) as an officer, employee
consultant, adviser or independent contractor such that such person would
thereafter be unable to devote his or her full business time and attention to
the business then conducted by the Company or such Transferee, as the case may
be.

                                                                    Page 7 of 9
<PAGE>

         i.       ACKNOWLEDGEMENT

         You hereby specifically acknowledge and agree that the restrictions
contained in Sections f, g and h hereof are reasonable and necessary to protect
the business and prospective business of Company and that the enforcement of
these provisions will not work an undue hardship on you.

         j.       ARBITRATION

         We shall arbitrate any dispute or controversy that should arise as to
the meaning, effect, performance, enforcement or other issues in connection
with, arising out of or relating to this Agreement, or any other dispute or
controversy, whether of law or fact of any nature whatsoever arising out of your
employment by the Company (including, but not limited to, all state and federal
statutory and discrimination claims whether for race, sex, sexual orientation,
religion, national origin, age, marital status, or medical condition, handicap
or disability, or otherwise) in Los Angeles County, California, before a single
arbitrator selected by and in accordance with the then rules of the American
Arbitration Association ("AAA"). The arbitrator shall apply California
substantive law and the California Evidence Code to the proceedings. The
arbitrator shall have the power to grant all legal and equitable remedies and
award compensatory damages provided by California law. The arbitrator shall
prepare in writing and provide to the parties an award indicating factual
findings and the reasons on which the decision is based. The written
determination of the arbitrator shall be final, conclusive and binding on the
parties and their affiliates. Provided, however, that the arbitrator shall not
have the power to commit errors of law or legal reasoning, and the award may be
vacated or corrected pursuant to California Code of Civil Procedure Sections
1286.2 or 1286.6 for any such error. In rendering its determination, the AAA
shall be entitled to allocate its fees and expenses among the parties in such
proportion as it deems appropriate in its sole discretion and each party agrees
to pay such fees and expenses forthwith after delivery of the AAA's
determination to them. The arbitrator shall also be entitled to award attorneys'
fees and expenses to the totally or partially prevailing party in such amount as
he or she deems appropriate in his or her sole discretion.

         k.       MISCELLANEOUS

         If any provision of this Agreement is held to be illegal, invalid, or
unenforceable under present or future laws, such provision shall be fully
severable, and this Agreement and each separate provision hereof shall be
construed and enforced as if such illegal invalid, or unenforceable provision
had never comprised a part of this Agreement, and the

                                                                    Page 8 of 9
<PAGE>

remaining provisions of this Agreement, shall remain in full force and effect
and shall not be affected by the illegal, invalid or unenforceable provisions
or by its severance from this Agreement. In addition, in lieu of such
illegal, invalid or unenforceable provision, there shall be added
automatically as a part of this Agreement a provision as similar in terms to
such illegal, invalid, or unenforceable provision as may be possible and be
legal, valid, and enforceable, if such reformation is allowable under
applicable law.

         This Agreement and the exhibits hereto constitutes the complete, final
and exclusive embodiment of the entire agreement between you and the Company
with respect to the terms and conditions of your employment, and it supersedes
any other agreements or promises made to you by anyone, whether oral or written.
You agree that, except as provided herein, no other representations or promises
were made to you regarding your employment with the Company. This Agreement
shall be construed and interpreted in accordance with the laws of the State of
California.

         We look forward to your joining the Company and to a successful and
enjoyable working relationship.

                            Sincerely,

                            Obagi Medical Products, Inc.

                            By: /s/ Peter Tong
                               -------------------------------------
                                   Peter Tong, Chairman of the Board

                            Accepted:

                             /s/ Phillip J. Rose   5/14/99
                            -----------------------------------------
                            Phillip J. Rose

                                                                    Page 9 of 9

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