CREDIT AGREEMENT



                          Dated as of February 8, 2002



                                  by and among



                          EON LABS MANUFACTURING, INC.,



                                 EON PHARMA, LLC



                                       and



                               JPMORGAN CHASE BANK







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                               TABLE OF CONTENTS



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ARTICLE I

        DEFINITIONS AND ACCOUNTING TERMS .....................................1

        SECTION 1.01.   DEFINITIONS...........................................1

        SECTION 1.02.   TERMS GENERALLY .....................................11



ARTICLE II

        LOANS................................................................11

        SECTION 2.01.  REVOLVING CREDIT LOANS................................11

        SECTION 2.02.  REVOLVING CREDIT NOTE.................................12



ARTICLE III

        PROVISIONS RELATING TO ALL EXTENSIONS OF CREDIT;

        FEES AND PAYMENTS....................................................13

        SECTION 3.01.  INTEREST RATE; CONTINUATION; AND CONVERSION OF LOANS..13

        SECTION 3.02.  USE OF PROCEEDS..............................,........15

        SECTION 3.03.  PREPAYMENTS..................................,........15

        SECTION 3.04.  FEES.........................................,........15

        SECTION 3.05.  INABILITY TO DETERMINE INTEREST RATE.........,........16

        SECTION 3.06.  ILLEGALITY...................................,........16

        SECTION 3.07.  INCREASED COSTS..............................,........16

        SECTION 3.08.  INDEMNITY....................................,........17

        SECTION 3.09.  TAXES........................................,........18

        SECTION 3.10.  PAYMENTS.....................................,........18

        SECTION 3.11.  DISBURSEMENT OF LOANS........................,........18



ARTICLE IV

        REPRESENTATIONS AND WARRANTIES.......................................19

        SECTION 4.01.   ORGANIZATION POWERS..................................19

        SECTION 4.02.   AUTHORIZATION OF BORROWING, ENFORCEABLE OBLIGATIONS..19

        SECTION 4.03.   FINANCIAL CONDITION..................................19

        SECTION 4.04.   TAXES................................................20

        SECTION 4.05.   TITLE TO PROPERTIES..................................20

        SECTION 4.06.   LITIGATION...........................................20

        SECTION 4.07.   AGREEMENTS...........................................21

        SECTION 4.08.   COMPLIANCE WITH ERISA................................21

        SECTION 4.09.   FEDERAL RESERVE REGULATIONS; USE OF PROCEEDS.........21

        SECTION 4.10.   APPROVAL.............................................21

        SECTION 4.11.   SUBSIDIARIES.........................................22

        SECTION 4.12.   HAZARDOUS MATERIALS..................................22

        SECTION 4.13.   INVESTMENT COMPANY ACT...............................22

        SECTION 4.14.   SECURITY AGREEMENT...................................22

        SECTION 4.15.   NO DEFAULT...........................................22

        SECTION 4.16.   MATERIAL CONTRACTS...................................22



                                      I





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         SECTION 4.17.   PERMITS AND LICENSES.................................22

         SECTION 4.18.   COMPLIANCE WITH LAW..................................23

         SECTION 4.19.   DISCLOSURE...........................................23

ARTICLE V

         CONDITIONS OF LENDING................................................23

         SECTION 5.01.   CONDITIONS TO INITIAL EXTENSION OF CREDIT............23

         SECTION 5.02.   CONDITIONS TO ALL EXTENSIONS OF CREDIT...............26

ARTICLE VI

         AFFIRMATIVE COVENANTS................................................26

         SECTION 6.01.   EXISTENCE, PROPERTIES, INSURANCE.....................26

         SECTION 6.02.   PAYMENT OF INDEBTEDNESS AND TAXES....................27

         SECTION 6.03.   FINANCIAL STATEMENTS, REPORTS, ETC...................27

         SECTION 6.04.   BOOKS AND RECORDS; ACCESS TO PREMISES................29

         SECTION 6.05.   NOTICE OF ADVERSE CHANGE.............................29

         SECTION 6.06.   NOTICE OF DEFAULT....................................29

         SECTION 6.07.   NOTICE OF LITIGATION.................................29

         SECTION 6.08.   NOTICE OF DEFAULT IN OTHER AGREEMENTS................30

         SECTION 6.09.   NOTICE OF ERISA EVENT................................30

         SECTION 6.10.   NOTICE OF ENVIRONMENTAL LAW VIOLATIONS...............30

         SECTION 6.11.   NOTICE REGARDING MATERIAL CONTRACTS..................30

         SECTION 6.12.   NOTICE OF REGULATORY MATTERS.........................31

         SECTION 6.13.   COMPLIANCE WITH APPLICABLE LAWS......................31

         SECTION 6.14.   SUBSIDIARIES.........................................31

         SECTION 6.15.   ENVIRONMENTAL LAWS...................................31

ARTICLE VII

         NEGATIVE COVENANTS...................................................32

         SECTION 7.01.   LIENS   .............................................32

         SECTION 7.02.   INDEBTEDNESS.........................................33

         SECTION 7.03.   GUARANTIES...........................................34

         SECTION 7.04.   SALE OF ASSETS.......................................34

         SECTION 7.05.   SALES OF RECEIVABLES.................................34

         SECTION 7.06.   LOANS AND INVESTMENTS................................35

         SECTION 7.07.   NATURE OF BUSINESS...................................35

         SECTION 7.08.   SALE AND LEASEBACK...................................35

         SECTION 7.09.   FEDERAL RESERVE REGULATIONS..........................35

         SECTION 7.10.   ACCOUNTING POLICIES AND PROCEDURES...................35

         SECTION 7.11.   HAZARDOUS MATERIALS..................................35

         SECTION 7.12.   LIMITATIONS ON FUNDAMENTAL CHANGES...................35

         SECTION 7.13.   FINANCIAL CONDITION COVENANTS........................36

         SECTION 7.14.   DIVIDENDS............................................36

         SECTION 7.15.   TRANSACTIONS WITH AFFILIATES.........................37

         SECTION 7.16.   IMPAIRMENT OF SECURITY INTEREST......................37



                                       II





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ARTICLE VIII

         EVENTS OF DEFAULT...................................................37

         SECTION 8.01.   EVENTS OF DEFAULT...................................37



ARTICLE IX

         MISCELLANEOUS.......................................................40

         SECTION 9.01.   NOTICES.............................................40

         SECTION 9.02.   EFFECTIVENESS; SURVIVAL.............................40

         SECTION 9.03.   EXPENSES............................................41

         SECTION 9.04.   SUCCESSORS AND ASSIGNS; PARTICIPATIONS..............41

         SECTION 9.05.   NO WAIVER; CUMULATIVE REMEDIES......................42

         SECTION 9.06.   APPLICABLE LAW......................................42

         SECTION 9.07.   SUBMISSION TO JURISDICTION..........................42

         SECTION 9.08.   SEVERABILITY........................................43

         SECTION 9.09.   RIGHT OF SETOFF.....................................43

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