Waiver To Credit Agreement

WAIVER TO CREDIT AGREEMENT


WAIVER, dated as of August 31, 2004, (the "Waiver") to the Credit Agreement, dated as of May 10, 2002 (as amended, the "Agreement"), by and between ACETO CORPORATION, a New York corporation. ACETO AGRICULTURAL CHEMICALS CORPORATION, a New York corporation, CDC PRODUCTS CORPORATION, a New York corporation, MAGNUM RESEARCH CORP., a New York corporation, ACCI REALTY CORP., a New York corporation, LARLABS CORP., a New York corporation, ARSYNCO INC., a New Jersey corporation, ROEHR CHEMICALS, INC., a New York corporation, ACETO INDUSTRIAL CHEMCIAL CORP., a New York corporation, jointly and severally (each a "Company" and, collectively, the "Companies") and JPMORGAN CHASE BANK, a New York banking corporation, (the "Lender").


RECITALS


The Company has requested certain waivers as set forth herein and the Lender has agreed to such waivers subject to the terms and conditions of this Waiver.


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


ARTICLE 1.
WAIVERS TO CREDIT AGREEMENT


Section 1.1. Compliance with Section 7.14 of the Agreement is hereby waived with respect to the payment by Aceto of dividends in the fiscal year ending June 30, 2004 provided that the aggregate dividends paid by Aceto during such period did not exceed $2,750,000.


Section 1.2. Compliance with Section 6.13 of the Agreement is hereby waived with respect to the failure to execute a Pledge Agreement and to provide the other documentation required thereunder with respect to Aceto Pharmaceutical Shanghai, Ltd. and Aceto (Shanghai), Ltd.


Section 1.3. The Credit Agreement and the other Loan Documents shall each be deemed to be waived hereby to the extent necessary, if any, to give effect to the provisions of this Waiver.


ARTICLE 2.
REPRESENTATIONS AND WARRANTIES


The Companies hereby represent and warrant to the Lender that:


SECTION 2.1. Each of the representations and warranties set forth in each Loan Document is true and correct is all material respects as of the date hereof with respect to the Companies, with the same effect as though made on the date hereof (unless any such representation and warranty is as of a specific date, in which event, as of such date), and is hereby incorporated herein in full by reference as if fully restated herein in its entirety.


Section 2.2. To induce the Lender to enter into this Waiver and to continue to make


advances to the Companies pursuant to the Agreement, the Companies hereby ...