Pledge Agreement

CITIZENS BANK OF MASSACHUSETTS PLEDGE AGREEMENT --------------------------------------------------------------------------------


This Pledge Agreement is made as of the 2nd day of March, 2004, by and between the following parties:


Citizens Bank of Massachusetts, as Administrative Agent
for the notable benefit of the Lenders (the "Agent"), a
Massachusetts banking corporation having a principal
place of business at 28 State Street, Boston,
Massachusetts 02109; and


Able Laboratories, Inc. ( the "Borrower"), a corporation
duly organized and existing under the laws of the State
of Delaware and having its corporate offices and
principal place of business at 6 Hollywood Court, South
Plainfield, New Jersey 07080;


in consideration of the mutual covenants and benefits to be derived herefrom.


W I T N E S S E T H:


A. The Borrower and the Agent and Lenders party hereto have entered into a certain Credit Agreement (the "Credit Agreement") of even date establishing a certain revolving line of credit facility in the maximum principal amount of Thirty Million Dollars ($30,000,000.00) (the "Revolving Credit Facility") for the Borrower's working capital and other financing needs including the issuance of letters of credit.


B. The Borrower's obligations under the Revolving Credit Facility are secured by, among other things, a security interest in all of the Borrower's assets as set forth in a certain Security Agreement of even date.


C. As a condition precedent to establishing the Revolving Credit Facility, the Agent has required that the Borrower enter into this Agreement and thereby pledge the Borrower's interests in RxBazaar, Inc. to the Agent as further collateral to the Agent.


NOW, THEREFORE, in consideration of the premises herein contained and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Borrower and the Agent agree as follows:


1. To secure the prompt, punctual, and faithful performance of all and each of the Obligations (as that term is defined herein) of the Borrower to the Agent, the Borrower hereby grants to the Agent a security interest in and to, and pledges and delivers to the Agent the following property, and all products, Proceeds, substitutions, additions, interest, dividends, and other distributions (including, without limitation, stock splits) in respect thereto, and all books, records, and papers relating to the foregoing (all of which is referred to hereinafter as the "Pledged Securities"):


345,333 shares of Series A Preferred Stock, evidenced by certificates No. 4 and No. 5 (for an aggregate of 2,466,667 shares before giving effect to a one-for-five reverse split and a conversion factor of .7 in a subsequent merger)


Warrant to purchase 168,000 shares of common stock (for an aggregate of 1,200,000 shares before giving effect to a one-for-five reverse split and a conversion factor of .7 in a subsequent merger.


Certificate No. 15 for 238,000 shares of common stock for an aggregate of 1,700,000 shares before giving effect to a one-for-five reverse split and a conversion factor of .7 in a subsequent merger.


Certificate No. RXB 0304 for 239,841 shares of common stock.


"Proceeds" of the Pledged Securities include, without limitation, any investment, instrument, security, certificate of deposit, or other asset purchased from time to time with the proceeds of any of the foregoing (or with the proceeds thereof) including: any into which any of the foregoing (or such proceeds) is "rolled" or "turned over"; any cash received on account of any of the foregoing; and any deposit or other account to the extent that any proceeds of any of the foregoing is deposited therein.


The Pledged Securities and any Proceeds are hereby agreed and acknowledged by the Borrower to be a portion of the "Collateral" as defined in the Security Agreement.


2. The Borrower represents that the Pledged Securities are held and owned by the Borrower free and clear of all liens, encumbrances, attachments, security interests, pledges, and charges, and is fully paid for and nonassessable.


3. The Borrower shall:


(a) execute all such instruments, documents, and papers, and will do all such acts as the Agent may request from time to time to carry into effect the provisions and intent of this Agreement, including, without limitation, the execution of stop transfer orders, stock powers, notifications to obligors on the Pledged Securities, the providing of notifications in connection with book entry securities or general intangibles, and the providing of instructions to the issuers of uncertificated securities, and will do all such other acts as the Agent may request with respect to the perfection and protection of the security interest granted herein;


(b) keep the Pledged Securities free and clear of all liens, encumbrances, attachments, security interests, pledges, and charges;


(c) deliver to the Agent, if and when received by the Borrower, any item representing or constituting any of the Pledged Securities, including, without limitation, all cash dividends and all stock certificates whether now existing or hereafter received as a result of any stock dividends, stock splits or other transactions;


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(d) Upon the request of the Agent, cause the issuer of any uncertifi ...