10-K/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K/A

AMENDMENT NO. 1

x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended March 31, 2003

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File No. 1-15445

DRUGMAX, INC.,

formerly known as DrugMax.com, Inc.

(Name of registrant as specified in its charter)

State of Nevada	34-1755390
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)
25400 US Highway 19 North, Suite 137, Clearwater, FL	33763
(Address of Principal Executive Officers)	(Zip Code)

Issuer’s telephone number: (727) 533-0431

Securities registered pursuant to Section 12(b) of the Exchange Act:

None.

Securities registered pursuant to Section 12(g) of the Exchange Act:

Common stock, Par value $.001 per share

(Title of Class)

Indicate by check mark whether the issuer (1) filed all reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  x  No  ¨

Indicate by check mark if no disclosure of delinquent filers in response to Item 405 of Regulation S-B is not contained in this form, and no disclosure will be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  x

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b2 of the Act). Yes  ¨   No  x

The aggregate market value of the Common Stock, $.001 par value, held by non-affiliates of the Registrant based upon the last price at which the common stock was sold as of the last business day of the Registrant’s most recently completed second fiscal quarter, September 30, 2002, as reported on the NASDAQ Stock Market was approximately $4,833,000. Shares of Common Stock held by each officer and director and by each person who owns 5% or more of the outstanding Common Stock have been excluded in that such persons may be deemed to be affiliates. This determination of affiliate status is not necessarily a conclusive determination for other purposes.

The number of shares outstanding of common stock as of July 9, 2003, was 7,178,976.

TABLE OF CONTENTS

		PAGE
	PART III
Item 10.	Directors and Executive Officers of the Registrant	3
Item 11.	Executive Compensation	5
Item 12.	Security Ownership of Certain Beneficial Owners and Management	7
Item 13.	Certain Relationships and Related Transactions	8
Item 14.	Controls and Procedures	10
Exhibits Index and Reports on Form 8-K		10
Signatures		13
Certifications		14

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EXPLANATORY NOTE

This Form 10-K/A amends the Form 10-K annual report for the fiscal year ended March 31, 2003 filed by DrugMax, Inc. (the “Company”) on July 15, 2003. This Form 10-K/A is being filed solely to set forth the information required by Items 10, 11, 12 and 13 of Part III of Form 10-K because a definitive proxy statement containing such information will not be filed within 120 days after the end of the fiscal year covered by the Company’s original Form 10-K filing. All other portions of the Company’s original Form 10-K filing remain in effect.

Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.

Set forth below is the business experience and other biographical information regarding the Company’s executive officers and directors as of July 23, 2003:

Name	Age	Position
Jugal K. Taneja (3)	59	Chairman of the Board and Chief Executive Officer
William L. LaGamba (3)	44	President, Chief Operating Officer, Secretary and Director
Ronald J. Patrick (1)	55	Chief Financial Officer, Vice President of Finance, Treasurer and Director
Howard L. Howell, DDS (1) (2)	56	Director
Robert G. Loughrey (2)	54	Director
Martin Sperber (1) (2) (3)	71	Director
Sushil Suri (3)	43	Director

(1) Member of Compensation Committee.

(2) Member of Audit Committee.

(3) Member of Executive Committee.

Pursuant to the Company’s bylaws, each director serves for a term of one (1) year or until his successor is duly qualified. Officers are appointed annually by the Board of Directors (subject to the terms of any employment agreement), at the annual meeting of the Board, to hold such office until an officer’s successor is duly appointed and qualified, unless an officer sooner dies, resigns or is removed by the Board. There are no family relationships among any of the Company’s directors and executive officers.

Information regarding Inside Directors and Executive Officers:

Jugal K. Taneja serves as the Company’s Chairman of the Board, and since October 2000 has served as its Chief Executive Officer. In addition to his service to the Company, Mr. Taneja operates several other companies. He is presently the Chairman of the Board of Dynamic Health Products, Inc. (“Dynamic”), a position he has held since Dynamic’s inception in 1991. Dynamic, a public company, is a distributor of proprietary and nonproprietary dietary supplements, over-the-counter drugs, and health and beauty care products. Mr. Taneja also serves as a director of Go2Pharmacy,Inc. (NasdaqSC:GORX), a publicly-held company that manufactures and distributes nutritional and health products. Mr. Taneja holds degrees in Petroleum Engineering, Mechanical Engineering, and a Masters in Business Administration from Rutgers University.

William L. LaGamba is a member of the Company’s Board of Directors and has served as its President, Chief Operating Officer and Secretary since October 2000. From March 2000 to October 2000, he served as the Company’s Chief Executive Officer. From November 1999 to October 2000, he also served as the Company’s Secretary and Treasurer. From June 1998 until joining the Company in November 1999, Mr. LaGamba served as Chief Executive Officer of Dynamic. He was also a founder and the President of Becan Distributors, Inc. (“Becan”) from its inception in January 1997 until it was acquired by the Company in November 1999. For 14 years prior to January 1997, Mr. LaGamba served in various capacities for McKesson Drug Company, a large distributor of pharmaceuticals, health and beauty care products and services, and FoxMeyer Drug Company.

Ronald J. Patrick is a member of the Company’s Board of Directors and has served as the Company’s Chief Financial Officer and Treasurer since the Company’s acquisition of Valley Drug Company (“Valley”) in April 2000. He also has served as the Company’s Vice President of Finance and Treasurer since October 2000. He also has served as Chief Financial Officer of Valley since January 1999. Before becoming Valley’s CFO, Mr. Patrick practiced as a Certified Public Accountant and was part owner of a full-service accounting firm for 20 years. He served as Managing Partner for six of those years and as Coordinator of Consulting Services

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for the last two years he was with the firm. Mr. Patrick graduated from Gannon College in 1970 with a degree in Business Administration and has been licensed to practice as a Certified Public Accountant since 1974.

Howard L. Howell, D.D.S. has served as a director of the Company since August 1999. Dr. Howell has been managing his private orthodontic dentistry practice since 1977. In addition to the private practice of orthodontics, Dr. Howell is the President of Howell, Whitehead & Associates, P.A., a multi-office private practice group specializing in pediatric dentistry and orthodontics. He also serves as Chief Executive Officer and a Director of Telluride Expeditions Corp., a Colorado-based travel agency, and as a director of Medcom Facilities Inc., a real estate holding company. Dr. Howell received his degree from the Medical College of Virginia.

Robert G. Loughrey has served as a director since June 2002. For over the past five years, Mr. Loughrey was the Senior Vice President and Manager of Mellon Business Credit, Inc. Over the past 20 years he has held various management positions in asset-based lending, middle-market lending and credit policy. Mr. Loughrey served as the Chairman of the Education and Planning Committee for the Commercial Finance Association from 1998 to 2002, and was a member of the organization’s Executive Committee. Mr. Loughrey earned several degrees from the University of Pittsburgh, including an M.B.A. in Finance, B.S. in Mathematics and B.A. in Economics.

Martin Sperber has served as a director since March 2002. Mr. Sperber was Chairman of the Board and Chief Executive Officer for Schein Pharmaceutical, Inc. from 1989 to 2000 and was president of Schein from its inception in 1985, when it was spun-off from Henry Schein, Inc. Mr. Sperber began his 45-year career as a retail pharmacist at Henry Schein, Inc., serving in various capacities during his tenure. Mr. Sperber earned a B.S. in Pharmaceutical Sciences, with honors, from Columbia University. He is a member of the Board of Directors of Long Island University and a member of the Council of Overseers for the Arnold and Marie Schwartz College of Pharmacy. He is also a former member of the boards of the Generic Pharmaceutical Industry Association and American Foundation for Pharmaceutical Education.

Sushil Suri has served as a director since September 2002. Mr. Suri has served as Chairman and Chief Executive Officer of MorepenMax, Inc. since its inception, and for over the past five years, Mr. Suri has served as Chief Executive Officer and Chairman of the Board of Morepen Laboratories, Ltd., an international provider of generic drugs and raw materials used to manufacture generic drugs.

Information regarding Key Employees:

Phillip J. Laird has served as Vice President of the Company and its Pittsburgh operations since the Company acquired Becan in November 1999. From May 1997 until November 1999, Mr. Laird was the Vice President of the Diabetes Supply Division of Direct Rx, Inc., the predecessor of Dynamic. Mr. Laird was also a retail area sales manager for McKesson Drug Company from November 1996 to May 1997. Similarly, Mr. Laird was a retail area sales manager for FoxMeyer Drug Company, managing approximately 250 retail pharmacies with four sales consultants from May 1994 to May 1997. Mr. Laird received a degree in Business Administration from Robert Morris College, Pennsylvania, in 1983.

Willem H. Hamers is the Vice President of Discount Rx, Inc., a subsidiary the Company acquired in connection with its acquisition of Becan. He has held this position since Becan founded Discount Rx in August 1998. Before becoming President of Discount Rx, Inc., Mr. Hamers served as the Executive Vice President of Sales for Penner & Welsch from 1997 to August 1998. Prior thereto, Mr. Hamers was a Sales Manager for the Slidell Division of McKesson Drug Company from 1996 to 1997, and he also was a Sales Manager for the Slidell Division of FoxMeyer Drug Company from 1991 to 1996.

Ralph A. Blundo has served as the President of Valley since the Company acquired Valley in January 1999. From 1986 through 1995, Mr. Blundo served as Valley’s Director of Sales and from 1996 to 1998 he served as Valley’s Vice President of Sales. During this period he was responsible for new account development and overall management of the sales staff. Mr. Blundo received a Bachelor of Science degree in Business Administration from Youngstown State University in 1970.

John P. Cairns has served as the Vice President of Sales of Valley since January 1999. From 1988 to 1998 Mr. Cairns held the position of Valley’s Territory Sales Manager. Prior to joining Valley, he was the Executive Vice President for Mincing Trading Corp., a subsidiary of C. Czarnidow, Ltd., a multi-national commodities trading company.

Compliance with Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934 requires the Company’s executive officers and directors, and persons who beneficially own more than 10% of the Company’s common stock, to file reports of ownership and changes in ownership with the

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Securities and Exchange Commission. Executive offers, directors and greater than 10% beneficial owners are required by the Securities and Exchange Commission regulations to furnish the Company with copies of all Section 16(a) forms they file.

Based solely on the Company’s review of the copies of the forms furnished to it or written representations from the reporting persons that no reports were required, the Company believes that, during it fiscal year ended March 31, 2003, all of its executive officers, directors and greater than 10% beneficial owners complied with all applicable Section 16(a) filing requirements, except as noted below:

Howard L. Howell, a director of the Company, did not file Form 4 relating to acquisitions of common stock of the Company made during the period of August 2000 through March 2003, until March 31, 2003.

Martin Sperber, a director of the Company, did not file Form 4 relating to the receipt of stock options granted him in March 2002, until July 2003.

Jugal K. Taneja, Chairman of the Board and CEO of the Company, did not file Form 4 relating to the acquisition of common stock granted him on June 13, 2003, until June 24, 2003.

Item 11. EXECUTIVE COMPENSATION

Compensation to Outside Directors

All of the Company’s directors receive $500 for each meeting of the Board of Directors that they attend, $2,000 per quarter and reimbursement of their reasonable out-of-pocket expenses incurred in connection with such meetings. In addition, each year, on the date that a director is elected to serve on the Board, he or she is granted a stock option to purchase 25,000 shares of the Company’s common stock, with an exercise price equal to the fair market value of the shares on the date of grant. These options vest upon attendance of two Board meetings during the fiscal year in which the options are granted. Additionally, each member of a committee of the Board of Directors receives an option to purchase 5,000 shares of the Company’s common stock, each chairperson of a committee receives an option to purchase an additional 2,500 shares of the Company’s common stock and the Chairman of the Board receives an option to purchase an additional 10,000 shares of the Company’s common stock on the date such persons are appointed to the foregoing positions, provided that they agree to serve in such positions for the entire year. The foregoing options are granted under the Company’s 1999 Stock Option Plan.

Compensation to Executive Officers

The following summary compensation table sets forth the cash and non-cash compensation paid during the past three fiscal years to (a) those individuals serving as the Company’s Chief Executive Officer during the fiscal year ended March 31, 2003 and (b) the four most highly compensative executive officers of the Company, receiving compensation of at least $100,000, during the fiscal year ended March 31, 2003 (the “Named Executive Officers”):

	Fiscal Year Ended March 31	Annual Compensation				Long-Term Compensation Awards	All Other Compensation ($)
Name And Principal Position		Salary ($)		Bonus ($)		Securities Underlying Options (#)
Jugal K. Taneja, Chairman of the Board and Chief Executive Officer	2003 2002 2001	$ $ $	156,881 69,471 100,000	$ $	4,981 18,500 —	42,500 132,500 —	$ $	7,500 56,000 —	(2) (1)
William L. LaGamba, President, Chief Operating Officer and Secretary	2003 2002 2001	$ $ $	166,065 160,413 150,000	$ $	1,481 5,500 —	30,000 110,000 —	$ $	7,500 6,000 —	(2) (2)
Ronald J. Patrick, Chief Financial Officer, Treasurer and Director	2003 2002 2001	$ $ $	138,000 137,000 125,000	$	10,000 5,000 —	30,000 105,000 —	$ $	7,500 5,500 —	(2) (2)

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(1) Includes $50,000.00 paid to Mr. Taneja as a consulting fee prior to the date of his employment agreement and $6,000.00 paid to Mr. Taneja in connection with his service as a Director.

(2) Consists of fees paid for service on the Board of Directors.

OPTION GRANTS IN LAST FISCAL YEAR

The following table provides information as to options granted to each of the Named Executive Officers of the Company during fiscal year ended March 31, 2003. All such options were granted under the 1999 Stock Option Plan.

Name	Number of Securities Underlying Options Granted	Percent of Total Options Granted to Employees in Fiscal Year		Exercise or Base Price ($ Per Share)		Expiration Date	Potential Realizable Value at Assumed Rates if Stock Price Appreciation for Option Term (1)
								5	%		10	%
Jugal K. Taneja	42,500	5.8	%	$	1.55	09/19/2012	$	41,428		$	104,988
William L. LaGamba	30,000	4.1	%	$	1.55	09/19/2012	$	29,244		$	74,109
Ronald J. Patrick	30,000	4.1	%	$	1.55	09/19/2012	$	29,244		$	74,109

(1) Potential realizable value is based on the assumption that the Common Stock appreciates at the annual rate shown (compounded annually) from the due date of grant until the expiration of the option term. These numbers are calculated based on the requirements of the SEC and do not reflect the Company’s estimate of future price growth.

AGGREGATED OPTIONS EXERCISED IN LAST FISCAL YEAR

AND FISCAL YEAR END OPTION VALUES

The following table provides information as to options exercised by each of the Named Executive Officers of the Company during the fiscal year ended March 31, 2003. The table sets forth the value of options held by such officers at year-end measured in terms of the closing price of the Company’s Common Stock on March 31, 2003.

	Shares Acquired on Exercise	Value Realized		Number of Securities Underlying Unexercised Options at Fiscal Year End		Value of Unexercised In-the- Money Options at Fiscal Year End
Name				Exercisable	Unexercisable	Exercisable		Unexercisable
Jugal K. Taneja	0	$	0	141,668	33,332	$	0	$	0
William L. LaGamba	0	$	0	156,668	33,332	$	0	$	0
Ronald J. Patrick	0	$	0	101,668	33,332	$	0	$	0

Employment Agreements and Other Arrangements

Jugal K. Taneja—Mr. Taneja is the Company’s Chairman of the Board and Chief Executive Officer. In October 2001, the Company entered into an employment agreement with Mr. Taneja. Mr. Taneja’s employment agreement provided for an initial 15-month term ending December 31, 2002, and an annual base salary of $144,500, plus bonuses and stock options as determined by the Board of Directors. In April 2003, the Company entered into a new employment agreement with Mr. Taneja for an initial three year term, and an initial annual base salary of $200,000, plus bonuses and stock options as determined by the Board of Directors. Mr. Taneja’s employment agreement contains standard termination provisions for disability, for cause, and for good reason, and it also contains confidentiality provisions that prohibit him from disclosing certain information belonging to the Company.

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William L. LaGamba—Mr. LaGamba is the Company’s President and Chief Operating Officer. In January 2000, the Company entered into an employment agreement with Mr. LaGamba. Mr. LaGamba’s employment agreement provided for an initial three-year term ending December 2002, an annual base salary of $163,500, plus an annual performance bonus and stock options as determined by the Board of Directors. In April 2003, the Company entered into a new employment agreement with Mr. LaGamba for an initial three-year term and an initial annual base salary of $175,000, plus bonuses and stock options as determined by the Board of Directors. Mr. LaGamba’s employment agreement also contains standard termination provisions for disability, for cause and for good reason. If the employment agreement is terminated other than for good reason or cause, Mr. LaGamba is entitled to receive his compensation through the end of the term of the agreement.

Ronald J. Patrick—Mr. Patrick became the Company’s Chief Financial Officer following the Company’s acquisition of Valley. He is also the Chief Financial Officer, Secretary and Treasurer of Valley. In April 2000, Valley entered into an employment agreement with Mr. Patrick. Mr. Patrick’s employment agreement with Valley provides for an initial three-year term ending April 2003, a current annual base salary of $137,000, plus such health and other benefits as the Board of Directors and/or any compensation and stock option committee of the Company may provide. In April 2003, the Company entered into a new employment agreement with Mr. Patrick for an initial three-year term and an initial annual base salary of $150,000, plus bonuses and stock options as determined by the Board of Directors. Mr. Patrick’s employment agreement contains standard termination provisions for disability, for cause, and for good reason, and it also contains confidentiality provisions prohibiting him from disclosing the Company’s confidential information. If the employment agreement is terminated other than for good reason or cause, Mr. Patrick is entitled to receive his compensation through the end of the term of the agreement.

Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

SECURITY OWNERSHIP OF MANAGEMENT AND OTHERS

To the knowledge of the Company, the following table sets forth, as of July 23, 2003, information as to the beneficial ownership of the Company’s voting securities by (i) each person known to the Company as having beneficial ownership of more than 5% of the Company’s voting securities, (ii) each person serving the Company as a director on such date, (iii) each person serving the Company as an executive officer on such date who qualifies as a Named Executive Officer, as defined in Item 403(a)(3) of Regulation S-K under the Securities Exchange Act of 1934, and (iv) all of the directors and executive officers of the Company as a group.

Name and Address of Beneficial Owner (2)	Amount and Nature of Shares Beneficially Owned (1)	Percentage of Class(1)
Dynamic Health Products, Inc. (3)	126,091	1.8	%
12399 Belcher Road South
Suite 160
Largo, Florida 33773
SMW Capital Group, L.P.	647,060	9.0	%
855 Dunbar Avenue
Oldsmar, Florida 34677
Jugal K. Taneja (4)	1,774,095	24.2	%
William L. LaGamba (5)	687,729	9.4	%
Ronald J. Patrick (6)	211,349	2.9	%
Dr. Howard L. Howell (7)	152,500	2.1	%
Robert G. Loughrey (8)	57,500	*
Stephen M. Watters (9)	730,420	10.2	%
855 Dunbar Avenue
Oldsmar, Florida 34677
Martin Sperber (10)	65,000	*
Sushil Suri	—	—
All Directors and Executive Officers as a group (7 persons)(11)	2,822,082	41.0	%

* Less than 1%.

(1) Based on 7,178,976 shares of Common Stock outstanding. Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission. Pursuant to the rules of the Securities Exchange Commission, certain shares of Common Stock which a person has the right to acquire within 60 days of the date hereof pursuant to the exercise of stock options are deemed to be outstanding for the purpose of computing the percentage ownership of such person but are not deemed

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outstanding for the purpose of computing the percentage ownership of any other person. To the Company’s knowledge, the persons named in this table have sole voting and investment power with respect to all shares of common stock shown as beneficially owned by them, subject to community property laws where applicable and except as indicated in the other footnotes to this table. Unless otherwise indicated, the business address of each of the beneficial owners named above is: c/o DrugMax, Inc., 25400 US Highway 19 North, Suite 137, Clearwater, FL 33763.

(2) Unless otherwise indicated, the address of each of the beneficial owners identified is 25400 US Highway 19 North, Suite 137, Clearwater, Florida 33763.

(3) Jugal K. Taneja, Chief Executive Officer and Chairman of the Board of the Company, is also the Chairman of the Board of Dynamic. He has beneficial ownership of approximately 52.0% of the outstanding voting stock of Dynamic. Members of his immediate family own in the aggregate an additional 24.0% of the outstanding voting stock of Dynamic. William L. LaGamba, the Company’s President and Chief Operating Officer, is also a stockholder of Dynamic, with beneficial ownership of approximately 28.2% of the outstanding voting stock of Dynamic.

(4) Includes 126,091 shares beneficially owned by Dynamic Health Products, Inc., 300,000 shares held of record by 21st Century Healthcare Fund, LLC, a limited liability company of which Jugal K. Taneja is the principal, 48,379 shares held of record by The First Delhi Trust, a trust established for the benefit of his children, 424,555 shares beneficially owned by Carnegie Capital, Ltd., a family limited partnership in which Jugal K. Taneja is the general partner, 90,802 shares held of record by Mr. Taneja, 369,510 shares held of record by Manju Taneja, his spouse, and 141,668 shares issuable upon the exercise of stock options that are currently exercisable.

(5) Includes 126,091 shares beneficially owned by Dynamic Health Products, Inc., 122,868 shares beneficially owned by Michele LaGamba, Mr. LaGamba’s spouse, 86,987 beneficially owned as custodian for minor-aged children, and 156,668 shares issuable upon the exercise of stock options that are currently exercisable. Mr. LaGamba disclaims voting power with respect to the shares held of record by his spouse.

(6) Includes 101,668 shares issuable upon the exercise of stock options that are currently exercisable

(7) Includes 112,500 shares issuable upon the exercise of stock options that are currently exercisable.

(8) Represents 57,500 shares issuable upon the exercise of stock options that are currently exercisable.

(9) Includes 647,060 shares beneficially owned by SMW Capital Group, L.P. Mr. Stephan M. Watters owns all of the shares of Summerford Capital, Inc., the general partner of SMW Capital Group, L.P.

(10) Represents 65,000 shares issuable upon the exercise of stock options that are currently exercisable.

(11) Includes 635,004 shares issuable upon the exercise of stock options that are currently exercisable.

Shares of the common stock of the Company are listed and traded on the Nasdaq Small Cap Market (“Nasdaq”) under the symbol “DMAX.”

Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

The information set forth herein briefly describes certain relationships and related transactions during the last three fiscal years between the Company and its Directors, officers and stockholders owning 5% or more of the Company’s Common Stock. These relationships and transactions have been and will continue to be reviewed and approved by a majority of the Company’s independent Directors and the Audit Committee.

Dynamic Health Products, Inc.

On September 13, 2000, the Company entered into a letter of intent to purchase substantially all of the assets of Penner & Welsch, Inc. (“P&W”), a wholesale distributor of pharmaceuticals, over-the-counter products and health and beauty care products, headquartered near New Orleans, Louisiana. Also on that date, P&W filed a voluntary petition for Chapter 11 relief under the United States Bankruptcy Code. The Company, on September 13, 2000, entered into a management agreement with P&W, pursuant to which it agreed to manage the day-to-day operations of P&W during the bankruptcy proceeding in exchange for a management fee equal to a percentage of the gross revenues of P&W each month. In turn, the Company entered into a management agreement with Dynamic pursuant to which Dynamic provided accounting support services to the Company in connection with the Company’s management responsibilities relating to P&W. Pursuant to this agreement, Dynamic was entitled to receive one-third of all fees collected by the

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Company from P&W. In fiscal 2002 and fiscal 2001, the total fees paid to Dynamic by the Company were $225,226 and $229,417, respectively. Both agreements were terminated in October 2001, in connection with the closing of the acquisition of certain assets from P&W by the Company.

Dynamic is a distributor of proprietary and nonproprietary dietary supplements, over-the-counter drugs, and health and beauty care products. Jugal K. Taneja, a principal stockholder and Chairman of the Board of the Company, is also the Chairman of the Board. Mr. Taneja has beneficial ownership of approximately 52.0% of the outstanding voting stock of Dynamic. Members of his immediate family own in the aggregate an additional 24.0% of the outstanding voting stock of Dynamic. William L. LaGamba, the Company’s President and Chief Operating Officer, is also a stockholder of Dynamic, with beneficial ownership of 28.2% of the outstanding voting stock of Dynamic.

Go2Pharmacy, Inc.

The Company entered into a First Right to Manufacture Agreement with Go2Pharmacy, Inc. pursuant to which Go2Pharmacy has agreed to manufacture all products that the Company requires and which it is capable of manufacturing. In addition, the Company is the exclusive distributor of Lean Protein Chips, a product manufactured by Go2Pharmacy, to all independent pharmacies. Purchases of all products purchased by the Company from Go2Pharmacy were approximately $3,200, $5,200 and $220,000 for the fiscal years ended March 31, 2003, 2002 and 2001, respectively, which purchases represent less than 1.5% of the products the Company purchased in each of such years. Jugal K. Taneja is a director of Go2Pharmacy, and Dynamic owns approximately 42% of Go2Pharmacy’s shares.

Valley Drug Company

In April 2000, in connection with the acquisition of Valley Drug Company, the Company loaned the sellers of Valley a total of $170,000 to pay for a portion of the flow through effects of their S Corporation taxable income resulting from the sale of Valley. These are interest-free notes and are to be repaid by Messrs. Patrick and Blundo upon their sale of the Company stock. At March 31, 2003, 2002 and 2001, the outstanding balance on the notes was $100,000. Mr. Patrick is the Company’s Chief Financial Officer and a director of the Company, and Mr. Blundo is the President of Valley, the Company’s wholly owned subsidiary.

Professional Pharmacy Solutions, LLC

Mr. Patrick, the Company’s Chief Financial Officer, and Mr. Blundo, Valley’s President, together own two-thirds of Professional Pharmacy Solutions, LLC (“PPS”), a pharmacy management company. Valley sells products to PPS under normal terms and conditions. During the fiscal year ended March 31, 2003, the Company generated revenues of approximately $1.5 million, and approximately $1.1 million in each of the fiscal years ended March 31, 2002 and 2001 on sales to PPS.

Advanced Pharmacy, Inc.

Advanced Pharmacy, Inc. (“Advanced”), is a retail pharmacy for prescription drugs owned by Mihir Taneja, a stockholder of the Company and the adult son of Mr. Taneja, the Chairman and CEO of the Company, and Michelle LaGamba, the spouse of William L. LaGamba, the President, COO and a Director of the Company. The Company sells products to Advanced under normal terms and conditions. In the fiscal years ended March 31, 2003, 2002 and 2001, the Company generated revenues of approximately $4.9 million, $18,000 and $19,000, respectively, from Advanced. At March 31, 2003, 2002 and 2001, the receivable balance due from Advanced was approximately $255,000, $19,000 and $18,000, respectively. At March 31, 2003, the Company also had an additional receivable from Advanced for approximately $95,000 representing start up inventory purchased by Advanced, which will be paid within one year.

River Road Real Estate

In October 2001, the Company executed a Commercial Lease Agreement with River Road Real Estate, LLC (“River Road”), a Florida limited liability company, to house the operations of Valley Drug Company South, the Company’s subsidiary, in St. Rose, Louisiana. River Road is owned, in part, by Messrs. Taneja and LaGamba. This lease is for an initial period of five years, with a base monthly lease payment of $15,000, and an initial deposit of $15,000 made to River Road by the Company. In the fiscal year ended March 31, 2003 the Company paid $180,000 to River Road, and in the fiscal year ended March 31, 2002, the Company paid $90,000 to River Road, which was a charge to rent expense.

MorpenMax

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On August 31, 2001, the Company reached an initial agreement with India-based Morepen Laboratories Ltd. (“Morepen Laboratories”), to form a joint venture company, and on September 10, 2001, MorepenMax, Inc, (“MorepenMax”), a Florida corporation, was formed. Morepen Laboratories is the 51% majority shareholder of MorepenMax. On March 22, 2002, the Company funded its investment of $49,000 in MorepenMax, representing its 49% interest. MorepenMax plans to utilize the Morepen facilities to develop low-cost generic pharmaceuticals in the United States. The Company will be the exclusive distributor throughout the United States of the products developed by MorepenMax. Mr. Suri, one of the Company’s directors, is the Chairman of the Board and Chief Executive Officer of Morepen Laboratories and MorepenMax. The Company did not make any material purchases from, or sales to, MorepenMax in the fiscal year ended March 31, 2003. In June 2003, MorepenMax introduced its first generic product for distribution through the Company.

Guaranty by Mr. Taneja of Company’s Credit Facility

In February 2000, the Company entered into a revolving credit facility with Merrill Lynch Financial, pursuant to which Merrill Lynch Financial granted to the Company a $5.0 million credit facility. The lender required and obtained a personal guaranty from Jugal K. Taneja, the Company’s Chairman of the Board and Chief Executive Officer. In consideration for Mr. Taneja’s acting as the guarantor, the Company granted to Mr. Taneja a warrant to purchase 200,000 shares of the Company’s common stock at a price of $15.98 per share, the average closing price over the 30-day period prior to execution of the guaranty. The warrant expired in February 2003.

On April 15, 2003, the Company entered into a credit facility with Congress Financial Corporation (“Congress”), pursuant to which Mr. Taneja executed a Guarantee (the “Guarantee”) in favor of Congress. The Guarantee provides Congress with Mr. Taneja’s unconditional guaranty of all obligations, liabilities, and indebtedness of any kind of the Company to Congress, subject to certain caps and limitations. In June 2003, the Company issued 57,143 shares of common stock of the Company to Mr. Taneja as compensation for his guarantee in favor of Congress.

Item 14. CONTROLS AND PROCEDURES

Within 90 days prior to the date of filing this Annual Report on Form 10-K/A, an evaluation was performed under the supervision and with the participation of our management, including the chief executive officer and chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on that evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures were effective as of the evaluation date. There have been no significant changes in our internal controls or in other factors that could significantly affect internal controls subsequent to the date of our evaluation.

Appearing immediately following the Signatures section of this report there are Certifications of the Chief Executive Officer and the Chief Financial Officer. The Certifications are required in accordance with Section 302 of the Sarbanes-Oxley Act of 2002 (the Section 302 Certifications). This Item of this report, which you are currently reading is the information concerning the Evaluation referred to in the Section 302 Certifications and this information should be read in conjunction with the Section 302 Certifications for a more complete understanding of the topics presented.

PART IV

Item 15. EXHIBITS

2.1	Agreement and Plan of Merger by and between NuMed Surgical, Inc. and Nutriceuticals.com Corporation, dated as of January 15, 1999. (1)
2.2	Agreement and Plan of Reorganization dated September 8, 1999 by and between Nutriceuticals.com Corporation and Dynamic Health Products, Inc. (2)
2.3	Agreement and Plan of Reorganization between DrugMax.com, Inc., Jimmy L. Fagala, K. Sterling Miller, and HCT Capital Corp. dated as of March 20, 2000. (3)
2.4	Stock Purchase Agreement between DrugMax.com, Inc. and W.A. Butler Company dated as of March 20, 2000. (3)
2.5	Merger Purchase Agreement between DrugMax.com, Inc., DrugMax Acquisition Corporation, and Valley Drug Company, Ronald J. Patrick and Ralph A. Blundo dated as of April 19, 2000. (4)

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2.6	Agreement for Purchase and Sale of Assets by and between Discount Rx, Inc., and Penner & Welsch, Inc., dated October 12, 2001. (11)
3.1	Articles of Incorporation of NuMed Surgical, Inc., filed October 18, 1993. (1)
3.2	Articles of Amendment to the Articles of Incorporation of NuMed Surgical, Inc., filed March 18, 1999. (1)
3.3	Articles of Merger of NuMed Surgical, Inc. and Nutriceuticals.com Corporation, filed March 18, 1999. (1)
3.4	Certificate of Decrease in Number of Authorized Shares of Common Stock of Nutriceuticals.com Corporation, filed October 29, 1999. (5)
3.5	Articles of Amendment to Articles of Incorporation of Nutriceuticals.com Corporation, filed January 11, 2000. (8)
3.6	Articles and Plan of Merger of Becan Distributors, Inc. and DrugMax.com, Inc., filed March 29, 2000. (8)
3.7	Amended and Restated Bylaws, dated November 11, 1999. (5)
4.2	Specimen of Stock Certificate. (8)
10.1	Employment Agreement by and between DrugMax, Inc. and William L. LaGamba dated April 1, 2003. *
10.2	Employment Agreement by and between DrugMax, Inc. and Ronald J. Patrick dated April 19, 2000. *
10.3	Employment Agreement by and between DrugMax, Inc. and Jugal K. Taneja, dated April 1, 2003. *
10.4	Consulting Agreement by and between DrugMax.com, Inc. and Stephen M. Watters dated August 10, 2000. (9)
10.5	DrugMax.com, Inc. 1999 Incentive and Non-Statutory Stock Option Plan. (8)
10.6	Amendment No. 1 to DrugMax, Inc. 1999 Incentive and Non-Statutory Stock Option Plan, dated June 5, 2002. (14)
10.7	Fourth Amendment and Modification to Loan and Security Agreement among DrugMax, Inc., Valley Drug Company, Discount Rx, Inc., Valley Drug Company South and Standard Federal Bank National Association dated October 28, 2002. (15)
10.8	Loan and Security Agreement by an between Congress Financial Corporation and DrugMax, Inc., Valley Drug Company, Valley Drug Company South and Discount Rx, Inc., dated April 15, 2003. (17)
16.1	Letter of Deloitte & Touche, LLP addressed to the Securities and Exchange Commission. (16)
21.0	Subsidiaries of DrugMax.com, Inc. (9)
99.1	Certification Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. *
99.2	Certification Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. *

* Filed herewith.

(1) Incorporated by reference to the Company’s Registration Statement on Form SB-2, filed June 29, 1999, File Number 0-24362, as amended.

(2) Incorporated by reference to Amendment No. 1 to the Company’s Registration Statement on Form SB-2, filed on September 13, 1999, File No. 0-24362.

(3) Incorporated by reference to the Company’s Report on Form 8-K, filed April 6, 2000, File Number 0-24362.

(4) Incorporated by reference to the Company’s Report on Form 8-K, filed May 3, 2000, File Number 0-24362.

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(5) Incorporated by reference to Amendment No. 2 to the Company’s Registration Statement on Form SB-2, filed on November 12, 1999, File No. 0-24362.

(6) Incorporated by reference to the Company’s Report on Form 8-K, filed February 8, 2000, File No. 0-24362.

(7) Incorporated by reference to the Company’s Form 10-KSB, filed June 29, 2000, File No. 0-24362.

(8) Incorporated by reference to the Company’s Form 10-KSB/A, filed July 14, 2000, File No. 0-24362.

(9) Incorporated by reference to the Company’s Registration Statement on Form SB-2, filed on November 1, 2000.

(10) Incorporated by reference to the Company’s Form 10-QSB, filed November 14, 2000, File No. 1-15445.

(11) Incorporated by reference to the Company’s Report on Form 8-K, filed November 9, 2001.

(12) Incorporated by reference to the Company’s Form 10-QSB, filed November 14, 2001.

(13) Incorporated by reference to the Company’s Form 10-QSB, filed February 14, 2002.

(14) Incorporated by reference to the Company’s Form 10-KSB, filed July 1, 2002.

(15) Incorporated by reference to the Company’s Form 10-Q, filed October 17, 2002.

(16) Incorporated by reference to the Company’s Form 8-K/A, filed February 28, 2003.

(17) Incorporated by reference to the Company’s Form 10-K, filed July 15, 2003.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	DRUGMAX, INC.
Dated: July 29, 2003	By:	/s/    JUGAL K. TANEJA
		Jugal K. Taneja, Chief Executive Officer and Chairman of the Board

Dated: July 29, 2003	By:	/s/    WILLIAM L. LAGAMBA
		William L. LaGamba, President and Chief Operating Officer

Dated: July 29, 2003	By:	/s/    RONALD J. PATRICK
		Ronald J. Patrick, Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant in the capacities and on the dates indicated.

Signatures		Title	Date
By:	/s/    JUGAL K. TANEJA Jugal K. Taneja	Chairman of the Board, Chief Executive Officer and Director	July 29, 2003

By: /s/    WILLIAM L. LAGAMBA William L. LaGamba President, Chief Operating Officer and Director July 29, 2003

By: /s/    RONALD J. PATRICK Ronald J. Patrick Chief Financial Officer and Director July 29, 2003

By: /s/    DR. HOWARD L. HOWELL, DDS Dr. Howard L. Howell, DDS Director July 29, 2003

By: /s/    ROBERT G. LOUGHREY Robert G. Loughrey Director July 29, 2003

By: /s/    MARTIN SPERBER Martin Sperber Director July 29, 2003

By: /s/    SUSHIL SURI Sushil Suri Director July 29, 2003

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CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE

SARBANES-OXLEY ACT OF 2002

I, Jugal K. Taneja, certify that:

1. I have reviewed this annual report on Form 10-K/A of DrugMax, Inc.;

2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

3. Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant, and we have:

a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others, particularly during the period in which this annual report is being prepared;

b) evaluated the effectiveness of the registrant’s disclosure controls and procedures as of a date within 90 days prior to the filing date of this annual report (the “Evaluation Date”); and

c) presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):

a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls; and

6. The registrant’s other certifying officer and I have indicated in this annual report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

Dated: July 29, 2003	By:	/s/    JUGAL K. TANEJA
		Jugal K. Taneja Chief Executive Officer

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CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF THE

SARBANES-OXLEY ACT OF 2002

I, Ronald J. Patrick, certify that:

1. I have reviewed this annual report on Form 10-K/A of DrugMax, Inc.;

2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

3. Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others, particularly during the period in which this annual report is being prepared;

b) evaluated the effectiveness of the registrant’s disclosure controls and procedures as of a date within 90 days prior to the filing date of this annual report (the “Evaluation Date”); and

c) presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):

a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls; and

6. The registrant’s other certifying officer and I have indicated in this annual report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

Dated: July 29, 2003	By:	/s/    RONALD J. PATRICK
		Ronald J. Patrick Chief Financial Officer

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EX-10.1

Exhibit 10.1

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT, dated effective as of April 1, 2003 (the “Agreement”), is by and between DrugMax, Inc., a Nevada corporation (the “Company”), and William L. LaGamba (the “Employee”).

WHEREAS, the Company is a full-line, wholesale distributor of pharmaceuticals, over-the-counter products, health and beauty care aids, and nutritional supplements;

WHEREAS, the Company wishes to assure itself of the services of Employee for the period provided in this Agreement and Employee is willing to serve in the employ of the Company for such period upon the terms and conditions hereinafter set forth.

NOW THEREFORE, in consideration of the mutual covenants herein contained, the parties, intending to be legally bound, hereby agree as follows:

1. EMPLOYMENT. The Company hereby agrees to employ Employee upon the terms and conditions herein contained, and Employee hereby accepts such employment for the term described below. Employee agrees to serve as the President and Chief Operating Officer of the Company during the term of this Agreement and shall report to (title). In such capacity, Employee shall have such powers and responsibilities consistent with Employee’s position as the President and Chief Operating Officer may assign to Employee. Throughout the term of this Agreement, Employee shall devote Employee’s best efforts and substantially all of Employee’s business time and services to the business and affairs of the Company.

2. TERM OF AGREEMENT. The three (3) year initial term of the employment under this Agreement shall commence as of the date set forth above (the “Effective Date”). After the expiration of such initial three-year period, the term of Employee’s employment hereunder shall automatically be extended without further action by the parties for successive one (1) year renewal terms, provided that if either party gives the other party at least thirty (30) days advance written notice prior to the expiration of the then current term of such party’s intention to not renew this Agreement for an additional term, the Agreement shall terminate upon the expiration of the current term.

3. SALARY AND BONUS

a. Employee shall receive an annual base salary during the term of this Agreement of $175,000, payable in installments consistent with the Company’s normal payroll schedule; provided that the annual base salary shall be subject to periodic review and adjustment by the Compensation Committee and/or the Board of Directors of the Company in its discretion.

b. Employee shall also be eligible to participate in any executive bonus plan created by the Board of Directors in the same manner and to the same extent as the other executives of the Company in the discretion of the Board of Directors.

4. WELFARE AND FRINGE BENEFITS.

a. Life Insurance. The Company shall pay a maximum of $1,000 per year towards a redeemable life insurance policy on the life of Employee, the proceeds of which shall be payable to Employee’s family.

b. Automobile and Other Allowances. During the term hereof, the Company shall also provide Employee with an automobile allowance of up to $750.00 per month and a club allowance of up $ 300.00 per month and also shall pay the dues on behalf of Employee for one airline club membership per year.

c. Expenses. The Company shall reimburse Employee for all reasonable expenses he incurs in promoting the Company’s business, including expenses for travel, entertainment of business associates, service and usage charges for business use of cellular phones and similar items, upon presentation by Employee from time to time of an itemized account of such expenditures in a form acceptable to the Company.

d. Vacation. Employee shall be entitled to an annual vacation of not less than four weeks, during which time his compensation shall be paid in full.

e. General. Employee shall be eligible to participate in such welfare benefit plans, programs, practices and policies of the Company as are generally applicable to other employees. Without limiting the foregoing, Employee shall be entitled to such other benefits as the Board of Directors and/or any Compensation and Stock Option Committee of the Board of Directors may from time to time approve for him.

5. TERMINATION

a. Involuntary Termination. The Company may terminate Employee’s employment hereunder at any time by giving written notice to Employee of termination. However, if Employee’s employment is terminated by the Company during the term of this Agreement pursuant to this Section 5(a), Employee shall be entitled to receive Employee’s base salary accrued through the date of termination plus one additional year of base salary payable in the same manner as base salary was previously paid to Employee.

b. Disability. The Company shall be entitled to terminate Employee’s employment immediately if Employee becomes disabled (as defined below). Upon such termination, the amount Employee shall be entitled to receive from the Company shall be limited to Employee’s base salary accrued through the date of termination and any payments as may be provided under any long-term disability plan or other disability program or insurance policies maintained or provided by the Company. “Disabled” shall mean that for a period of three (3) consecutive months or an aggregate of four (4) months in any twelve (12) month period Employee is incapable of fulfilling the duties of his or her position because of physical, mental or emotional incapacity, injury, sickness or disease. Any question as to the existence or extent of the disability upon which Employee and the Company cannot agree shall be determined by a qualified, independent physician selected by the Company. The determination of any such physician shall be final and conclusive for all purposes.

c. Termination for Cause. The Company may terminate Employee’s employment hereunder for Cause (as defined below) immediately without notice. If Employee’s employment is terminated by the Company for Cause, the amount Employee shall be entitled to receive from the Company shall be limited to Employee’s base salary accrued through the date of termination.

For purposes of this Agreement, the term “Cause” shall be limited to (i) embezzlement, fraud, misappropriation of corporate assets or a breach of the covenants set forth in Sections 9, 10 and 11 below; (ii) Employee being arrested or indicted in connection with a felony; (iii) Employee being arrested or indicted of any lesser crime or offense committed in connection with the performance of Employee’s duties hereunder or involving moral turpitude; (iv) the habitual failure or refusal by Employee to perform Employee’s duties hereunder after being provided with written warnings and a reasonable period to cure; or (v) chronic absenteeism.

d. Voluntary Termination by Employee. If Employee resigns or otherwise voluntarily terminates Employee’s employment before the end of the current term of this Agreement, other than pursuant to the provisions of Section 5(e) of this Agreement, the amount Employee shall be entitled to receive from the Company shall be limited to Employee’s base salary accrued through the date of termination.

e. Termination for Good Reason by Employee. Employee may terminate this Agreement for “Good Reason” (as defined below), provided that he shall first provide the Company with prior written notice, which notice shall state with specificity the reason for the termination and provide the Company with thirty (30) days from and after the giving of such notice to cure the breach. If the Company fails to cure the breach within such thirty days, Employee shall be entitled to receive Employee’s base salary accrued through the date of termination plus one additional year of base salary payable in the same manner as base salary was previously paid to Employee. For purposes of Section 5(e), the Executive shall have “Good Reason” to terminate his employment hereunder if such termination shall be the result of:

(i) any material demotion regarding Employee’s status, title, authorities or responsibilities (including reporting responsibilities) under this Employment Agreement; or

(ii) the reassignment of Employee to a location more than fifty (50) miles from the location where he presently works.

6. DEATH. If Employee dies during the term of this Agreement, the Company shall pay to Employee’s estate a lump sum payment equal to the sum of Employee’s base salary accrued through the date of death plus the total unpaid amount of any bonuses earned. In addition, the death benefits payable by reason of Employee’s death under any retirement, deferred compensation or other employee benefit plan maintained by the Company shall be paid to the beneficiary designated by Employee in accordance with the terms of the applicable plan or plans.

7. CHANGE OF CONTROL.

a. Salary. Upon a Change in Corporate Control (as defined below), if there is a reduction in the Employee’s base salary, the Employee shall have the option to terminate his Employment and should Employee elect to terminate his Employment, the Company shall be obligated to make a series of twelve (12) monthly payments to the Employee. Each monthly payment shall be equal to the sum of one-twelfth ( ¹/12^th) of the Employee’s annual base salary, as in effect on the date of termination, provided that if the Employee obtains a replacement position with any new employer (including a position as an officer, employee, consultant, or agent, or self-employment as a partner or sole proprietor), the payments shall be reduced by all amounts the Employee receives as compensation for services performed during such period.

b. Stock Options. Further, upon a Change in Corporate Control, the vesting of any stock options granted to the Employee under the terms of the Company’s Stock Option Plan shall become immediately vested in full and exercisable in full.

c. Definition. For purposes of this Agreement, a “Change in Corporate Control” shall include any of the following events: i. The acquisition in one or more transactions of more than forty percent (40%) of the Company’s outstanding Common Stock by any corporation, or other person or group (within the meaning of Section 14(d)(3) of the Securities Exchange Act of 1934, as amended), with the exclusion of Jugal K. Taneja or any person, group, corporation, or affiliates thereof, which are controlled by Jugal K. Taneja.

ii. Any merger or consolidation of the Company into or with another corporation in which the Company is not the surviving entity, or any transfer or sale of substantially all of the assets of the Company or any merger or consolidation of the Company into or with another corporation in which the Company is the surviving entity and, in connection with such merger or consolidation, all or part of the outstanding shares of Common Stock shall be changed into or exchanged for other stock or securities of any other person, or cash, or any other property, with the exclusion of any mergers with any person, group, corporation, or affiliates thereof which are controlled by Jugal K. Taneja

iii Any person, or group of persons, announces a tender offer for at least forty percent (40%) of the Company’s Common Stock, with the exclusion of Jugal K. Taneja or any person, group, corporation, or affiliates thereof, which are controlled by Jugal K. Taneja.

d. Limitation. Notwithstanding anything else in this Agreement, the amount of severance compensation payable to the Employee as a result of a Change in Corporate Control under this Section 7, or otherwise, shall be limited to the maximum amount the Company would be entitled to deduct pursuant to Section 280G of the Internal Revenue Code of 1986, as amended.

8. WITHHOLDING. The Company shall, to the extent permitted by law, have the right to withhold and deduct from any payment hereunder any federal, state or local taxes of any kind required by law to be withheld with respect to any such payment.

9. PROTECTION OF CONFIDENTIAL INFORMATION. Employee agrees that Employee shall keep all confidential or proprietary information of the Company or relating to its business (including, but not limited to, information regarding the Company’s customers, vendors, pricing policies, methods of operation, proprietary computer programs and trade secrets) confidential, and that Employee shall not (except with the Company’s prior written consent), while in the employ of the Company or thereafter, disclose any such confidential information to any person, firm, corporation, association or other entity, other than in furtherance of Employee’s duties hereunder, and then only to those with a need to know. Employee shall not make use of any such confidential information for Employee’s own purposes or for the benefit of any person, firm, corporation, association or other entity (except the Company) under any circumstances during or after the term of Employee’s employment. The foregoing shall not apply to any information which, is generally disclosed to the public by the Company or is otherwise in the public domain at the time of disclosure.

Employee recognizes that because Employee’s work for the Company shall bring Employee into contact with confidential and proprietary information of the Company, the restrictions of this Section 9 are required for the reasonable protection of the Company and its investments and for the Company’s reliance on and confidence in Employee.

Further, Employee agrees that upon request or upon termination of this Agreement (for any reason), Employee shall deliver to the Company any and all

drawings, notes, documents and other materials which he has received from the Company or which have originated from the employment activity.

10. COVENANT NOT TO COMPETE

a. Employee hereby agrees that Employee shall not, either during the employment term or during a period of one (1) year from the time Employee’s employment under this Agreement ceases or is terminated (for whatever reason), engage in any business activities on behalf of any enterprise which competes with the Company. Employee shall be deemed to be engaged in such competitive business activities if Employee participates in such a business enterprise as an employee, officer, director, consultant, agent, partner, proprietor, or other participant; provided that the ownership of no more than 2 percent of the stock of a publicly traded corporation engaged in a competitive business shall not be deemed to be engaging in competitive business activities.

b. Employee agrees that Employee shall not for Employee or for any other person, firm, corporation, partnership or other entity, for a period of one (1) year from the time Employee’s employment under this Agreement ceases or is terminated (for whatever reason), directly or indirectly

c. i. solicit any sales agent, employee, former employee who was employed by the Company in the preceding 180 days or full-time consultant of the Company for the purposes of hiring or retaining such sales agent, employee or consultant,

ii. contact any present or prospective client of the Company to solicit such a person to enter into a contract or arrangement with any competitor of the Company, or

iii. make known the names and/or addresses of such clients or any information relating in any manner to the Company’s trade or business relationships with such clients.

d. Employee further agrees that Employee shall not, either during the employment term or at any time thereafter, in any way disparage the Company.

11. OWNERSHIP OF DEVELOPMENTS

a. All copyrights, patents, trade secrets, or other intellectual property rights associated with any ideas, concepts, techniques, inventions, processes, or works of authorship develop or created by Employee during the course of performing work for the Company or its clients (collectively, the “Work Product”) shall belong exclusively to the Company and shall, to the extent possible, be considered a work made by Employee for hire for the Company within the meaning of Title 17 of the United States Code. To the extent the Work Product may not be considered work made by Employee for hire for the Company, Employee agrees to assign and automatically assigns to the Company at the time of creation of the Work Product, without any requirement of further consideration, any right, title, or interest Employee may have in such Work Product. Upon the request of the Company, Employee

shall take such further actions, including execution and delivery of instruments of conveyance, as may be appropriate to give full and proper effect to such assignment.

b. Solely for purposes of Sections 9, 10, 11 and 12 hereof only, the term “Company” also shall include any existing or future subsidiaries of the Company that are operating during the time periods described herein and any other entities that directly or indirectly, through one or more intermediaries, control, are controlled by or are under common control with the Company during the periods described herein.

12. INJUNCTIVE RELIEF

a. Employee acknowledges and agrees that it would be difficult to fully compensate the Company for damages resulting from the breach or threatened breach of the covenants set forth in Sections 9, 10 and 11 of this Agreement and accordingly agrees that the Company shall be entitled to temporary and injunctive relief, including temporary restraining orders, preliminary injunctions and permanent injunctions, to enforce such provisions in any action or proceeding instituted in any court having subject matter jurisdiction, without having to post a bond or other security. This provision with respect to injunctive relief shall not, however, diminish the Company’s right to claim and recover damages. Employee agrees to pay to the Company all costs and expenses incurred by the Company relating to the enforcement of the terms of Sections 9, 10 and 11 hereof, including reasonable fees and disbursements of counsel (both at trial and appellate proceedings).

b. It is expressly understood and agreed that although the parties consider the restrictions contained in this Agreement to be reasonable, if a court determines that the time or territory or any other restriction contained in this Agreement is an unenforceable restriction on the activities of Employee, no such provision of this Agreement shall be rendered void but shall be deemed amended to apply as to such maximum time and territory and to such extent as such court may judicially determine or indicate to be reasonable.

c. Employee acknowledges and confirms that (a) the restrictive covenants contained in Sections 9 and 10 hereof are reasonably necessary to protect the legitimate business interests of the Company, and (b) the restrictions contained in Sections 9 and 10 hereof (including without limitation the length of the term of the provisions of Sections 9 and 10 hereof) are not overbroad, overlong, or unfair and are not the result of overreaching, duress or coercion of any kind. Employee further acknowledges and confirms that Employee’s full, uninhabited and faithful observance of each of the covenants contained in Sections 9 and 10 hereof shall not cause Employee any undue hardship, financial or otherwise, and that enforcement of each of the covenants contained herein shall not impair Employee’s ability to obtain employment commensurate with Employee’s abilities and on terms fully acceptable to Employee or otherwise to obtain income required for the comfortable support of Employee and Employee’s family and the satisfaction of the needs of Employee’s creditors. Employee acknowledges and confirms that Employee’s special knowledge of the business of the Company is such as would cause the Company serious injury or loss if Employee were to use such ability and knowledge to the benefit of a competitor or were to compete with the Company in violation of the terms of Sections 9 and 10 hereof. Employee

further acknowledges that the restrictions contained in Sections 9 and 10 hereof are intended to be, and shall be, for the benefit of and shall be enforceable by, the Company’s successors and assigns.

d. If Employee shall be in violation of any provision of Sections 9 and 10, then each time limitation set forth in the applicable section shall be extended for a period of time equal to the period of time during which such violation or violations occur. If the Company seeks injunctive relief from such violation in any court, then the time limitations shall be extended for a period of time equal to the pendency of such proceeding including all appeals by Employee.

13. SEPARABILITY. If any provision of this Agreement shall be declared to be invalid or unenforceable, in whole or in part, such invalidity or unenforceability shall not affect the remaining provisions hereof which shall remain in full force and effect.

14. ASSIGNMENT. This Agreement shall be binding upon and inure to the benefit of the heirs and representatives of Employee and the assigns and successors of the Company, but neither this Agreement nor any rights hereunder shall be assignable or otherwise subject to hypothecation by Employee.

15. ENTIRE AGREEMENT. This Agreement represents the entire agreement of the parties and shall supersede any and all previous contracts, arrangements or understandings between the Company and Employee. The Agreement may be amended at any time by mutual written agreement of the parties hereto.

16. GOVERNING LAW; VENUE. This Agreement shall be construed, interpreted, and governed in accordance with the laws of the State of Florida, other than the conflict of laws provisions of such laws. Hillsborough or Pinellas County, Florida shall be the proper venues for any litigation arising out of this Agreement.

17. COUNTERPARTS. This Agreement may be executed in one or more counterparts all of which taken together shall constitute one and the same instrument.

18. NOTICE. Any notice or other communication which is required or permitted under this Agreement shall be in writing and shall be deemed to have been given, delivered, or made, as the case may be (notwithstanding lack of actual receipt by the addressee) (i) on the date sent if delivered personally or by cable, telecopy, telegram, telex, or facsimile (which is confirmed), (ii) three (3) business days after having been deposited in the United States mail, certified or registered, return receipt requested, sufficient postage affixed and prepaid, or (iii) one (1) business day after having been deposited with a nationally recognized overnight courier service (such as by way of example, but not limitation, U.S. Express Mail, Federal Express, or Airborne), to the parties at the following addresses (or at such other address for a party as shall be specified by like notice):

If to the Company:             DrugMax, Inc.             25400 U.S. Hwy 19 N. Ste 137             Clearwater, FL 33763             Attention: Chief Executive Officer

	(727) 533-0431 Fax (727) 531-1280
With a copy to Counsel:	Shumaker, Loop & Kendrick LLP 101 E. Kennedy Blvd. Suite 2800 Tampa, Florida 33602 Attention: Julio Esquivel

If to the Employee:
	Fax

IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed, and the Employee has hereunto set Employee’s hand, as of the day and year first above written.

DRUGMAX, INC.
By:	/s/    JUGAL K. TANEJA
Name:	Jugal K. Taneja
Title:	CEO and Chairman

EMPLOYEE:
	/s/    WILLIAM L. LAGAMBA
Name:	William L. LaGamba

EX-10.2

Exhibit 10.2

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT, dated effective as of April 1, 2003 (the “Agreement”), is by and between DrugMax, Inc., a Nevada corporation (the “Company”), and Ronald J. Patrick (the “Employee”).

WHEREAS, the Company is a full-line, wholesale distributor of pharmaceuticals, over-the-counter products, health and beauty care aids, and nutritional supplements;

WHEREAS, the Company wishes to assure itself of the services of Employee for the period provided in this Agreement and Employee is willing to serve in the employ of the Company for such period upon the terms and conditions hereinafter set forth.

NOW THEREFORE, in consideration of the mutual covenants herein contained, the parties, intending to be legally bound, hereby agree as follows:

1. EMPLOYMENT. The Company hereby agrees to employ Employee upon the terms and conditions herein contained, and Employee hereby accepts such employment for the term described below. Employee agrees to serve as the Chairman and Chief Operating Officer of the Company during the term of this Agreement and shall report to (title). In such capacity, Employee shall have such powers and responsibilities consistent with Employee’s position as the Chairman and Chief Executive Officer may assign to Employee. Throughout the term of this Agreement, Employee shall devote Employee’s best efforts and substantially all of Employee’s business time and services to the business and affairs of the Company.

2. TERM OF AGREEMENT. The three (3) year initial term of the employment under this Agreement shall commence as of the date set forth above (the “Effective Date”). After the expiration of such initial three-year period, the term of Employee’s employment hereunder shall automatically be extended without further action by the parties for successive one (1) year renewal terms, provided that if either party gives the other party at least thirty (30) days advance written notice prior to the expiration of the then current term of such party’s intention to not renew this Agreement for an additional term, the Agreement shall terminate upon the expiration of the current term.

3. SALARY AND BONUS

a. Employee shall receive an annual base salary during the term of this Agreement of $150,000, payable in installments consistent with the Company’s normal payroll schedule; provided that the annual base salary shall be subject to periodic review and adjustment by the Compensation Committee and/or the Board of Directors of the Company in its discretion.

b. Employee shall also be eligible to participate in any executive bonus plan created by the Board of Directors in the same manner and to the same extent as the other executives of the Company in the discretion of the Board of Directors.

4. WELFARE AND FRINGE BENEFITS.

a. Life Insurance. The Company shall pay a maximum of $1,000 per year towards a redeemable life insurance policy on the life of Employee, the proceeds of which shall be payable to Employee’s family.

b. Automobile and Other Allowances. During the term hereof, the Company shall also provide Employee with an automobile allowance of up to $750.00 per month and a club allowance of up $ 300.00 per month and also shall pay the dues on behalf of Employee for one airline club membership per year.

c. Expenses. The Company shall reimburse Employee for all reasonable expenses he incurs in promoting the Company’s business, including expenses for travel, entertainment of business associates, service and usage charges for business use of cellular phones and similar items, upon presentation by Employee from time to time of an itemized account of such expenditures in a form acceptable to the Company.

d. Vacation. Employee shall be entitled to an annual vacation of not less than four weeks, during which time his compensation shall be paid in full.

e. General. Employee shall be eligible to participate in such welfare benefit plans, programs, practices and policies of the Company as are generally applicable to other employees. Without limiting the foregoing, Employee shall be entitled to such other benefits as the Board of Directors and/or any Compensation and Stock Option Committee of the Board of Directors may from time to time approve for him.

5. TERMINATION

a. Involuntary Termination. The Company may terminate Employee’s employment hereunder at any time by giving written notice to Employee of termination. However, if Employee’s employment is terminated by the Company during the term of this Agreement pursuant to this Section 5(a), Employee shall be entitled to receive Employee’s base salary accrued through the date of termination plus one additional year of base salary payable in the same manner as base salary was previously paid to Employee.

b. Disability. The Company shall be entitled to terminate Employee’s employment immediately if Employee becomes disabled (as defined below). Upon such termination, the amount Employee shall be entitled to receive from the Company shall be limited to Employee’s base salary accrued through the date of termination and any payments as may be provided under any long-term disability plan or other disability program or insurance policies maintained or provided by the Company. “Disabled” shall mean that for a period of three (3) consecutive months or an aggregate of four (4) months in any twelve (12) month period Employee is incapable of fulfilling the duties of his or her position because of physical, mental or emotional incapacity, injury, sickness or disease. Any question as to the existence or extent of the disability upon which Employee and the Company cannot agree shall be determined by a qualified, independent physician selected by the Company. The determination of any such physician shall be final and conclusive for all purposes.

c. Termination for Cause. The Company may terminate Employee’s employment hereunder for Cause (as defined below) immediately without notice. If Employee’s employment is terminated by the Company for Cause, the amount Employee shall be entitled to receive from the Company shall be limited to Employee’s base salary accrued through the date of termination.

For purposes of this Agreement, the term “Cause” shall be limited to (i) embezzlement, fraud, misappropriation of corporate assets or a breach of the covenants set forth in Sections 9, 10 and 11 below; (ii) Employee being arrested or indicted in connection with a felony; (iii) Employee being arrested or indicted of any lesser crime or offense committed in connection with the performance of Employee’s duties hereunder or involving moral turpitude; (iv) the habitual failure or refusal by Employee to perform Employee’s duties hereunder after being provided with written warnings and a reasonable period to cure; or (v) chronic absenteeism.

d. Voluntary Termination by Employee. If Employee resigns or otherwise voluntarily terminates Employee’s employment before the end of the current term of this Agreement, other than pursuant to the provisions of Section 5(e) of this Agreement, the amount Employee shall be entitled to receive from the Company shall be limited to Employee’s base salary accrued through the date of termination.

e. Termination for Good Reason by Employee. Employee may terminate this Agreement for “Good Reason” (as defined below), provided that he shall first provide the Company with prior written notice, which notice shall state with specificity the reason for the termination and provide the Company with thirty (30) days from and after the giving of such notice to cure the breach. If the Company fails to cure the breach within such thirty days, Employee shall be entitled to receive Employee’s base salary accrued through the date of termination plus one additional year of base salary payable in the same manner as base salary was previously paid to Employee. For purposes of Section 5(e), the Executive shall have “Good Reason” to terminate his employment hereunder if such termination shall be the result of:

(i) any material demotion regarding Employee’s status, title, authorities or responsibilities (including reporting responsibilities) under this Employment Agreement; or

(ii) the reassignment of Employee to a location more than fifty (50) miles from the location where he presently works.

6. DEATH. If Employee dies during the term of this Agreement, the Company shall pay to Employee’s estate a lump sum payment equal to the sum of Employee’s base salary accrued through the date of death plus the total unpaid amount of any bonuses earned. In addition, the death benefits payable by reason of Employee’s death under any retirement, deferred compensation or other employee benefit plan maintained by the Company shall be paid to the beneficiary designated by Employee in accordance with the terms of the applicable plan or plans.

7. CHANGE OF CONTROL.

a. Salary. Upon a Change in Corporate Control (as defined below), if there is a reduction in the Employee’s base salary, the Employee shall have the option to terminate his Employment and should Employee elect to terminate his Employment, the Company shall be obligated to make a series of twelve (12) monthly payments to the Employee. Each monthly payment shall be equal to the sum of one-twelfth ( ¹/12^th) of the Employee’s annual base salary, as in effect on the date of termination, provided that if the Employee obtains a replacement position with any new employer (including a position as an officer, employee, consultant, or agent, or self-employment as a partner or sole proprietor), the payments shall be reduced by all amounts the Employee receives as compensation for services performed during such period.

b. Stock Options. Further, upon a Change in Corporate Control, the vesting of any stock options granted to the Employee under the terms of the Company’s Stock Option Plan shall become immediately vested in full and exercisable in full.

c. Definition. For purposes of this Agreement, a “Change in Corporate Control” shall include any of the following events: i. The acquisition in one or more transactions of more than forty percent (40%) of the Company’s outstanding Common Stock by any corporation, or other person or group (within the meaning of Section 14(d)(3) of the Securities Exchange Act of 1934, as amended), with the exclusion of Jugal K. Taneja or any person, group, corporation, or affiliates thereof, which are controlled by Jugal K. Taneja.

ii. Any merger or consolidation of the Company into or with another corporation in which the Company is not the surviving entity, or any transfer or sale of substantially all of the assets of the Company or any merger or consolidation of the Company into or with another corporation in which the Company is the surviving entity and, in connection with such merger or consolidation, all or part of the outstanding shares of Common Stock shall be changed into or exchanged for other stock or securities of any other person, or cash, or any other property, with the exclusion of any mergers with any person, group, corporation, or affiliates thereof which are controlled by Jugal K. Taneja

iii Any person, or group of persons, announces a tender offer for at least forty percent (40%) of the Company’s Common Stock, with the exclusion of Jugal K. Taneja or any person, group, corporation, or affiliates thereof, which are controlled by Jugal K. Taneja.

d. Limitation. Notwithstanding anything else in this Agreement, the amount of severance compensation payable to the Employee as a result of a Change in Corporate Control under this Section 7, or otherwise, shall be limited to the maximum amount the Company would be entitled to deduct pursuant to Section 280G of the Internal Revenue Code of 1986, as amended.

8. WITHHOLDING. The Company shall, to the extent permitted by law, have the right to withhold and deduct from any payment hereunder any federal, state or local taxes of any kind required by law to be withheld with respect to any such payment.

9. PROTECTION OF CONFIDENTIAL INFORMATION. Employee agrees that Employee shall keep all confidential or proprietary information of the Company or relating to its business (including, but not limited to, information regarding the Company’s customers, vendors, pricing policies, methods of operation, proprietary computer programs and trade secrets) confidential, and that Employee shall not (except with the Company’s prior written consent), while in the employ of the Company or thereafter, disclose any such confidential information to any person, firm, corporation, association or other entity, other than in furtherance of Employee’s duties hereunder, and then only to those with a need to know. Employee shall not make use of any such confidential information for Employee’s own purposes or for the benefit of any person, firm, corporation, association or other entity (except the Company) under any circumstances during or after the term of Employee’s employment. The foregoing shall not apply to any information which, is generally disclosed to the public by the Company or is otherwise in the public domain at the time of disclosure.

Employee recognizes that because Employee’s work for the Company shall bring Employee into contact with confidential and proprietary information of the Company, the restrictions of this Section 9 are required for the reasonable protection of the Company and its investments and for the Company’s reliance on and confidence in Employee.

Further, Employee agrees that upon request or upon termination of this Agreement (for any reason), Employee shall deliver to the Company any and all

drawings, notes, documents and other materials which he has received from the Company or which have originated from the employment activity.

10. COVENANT NOT TO COMPETE

a. Employee hereby agrees that Employee shall not, either during the employment term or during a period of one (1) year from the time Employee’s employment under this Agreement ceases or is terminated (for whatever reason), engage in any business activities on behalf of any enterprise which competes with the Company. Employee shall be deemed to be engaged in such competitive business activities if Employee participates in such a business enterprise as an employee, officer, director, consultant, agent, partner, proprietor, or other participant; provided that the ownership of no more than 2 percent of the stock of a publicly traded corporation engaged in a competitive business shall not be deemed to be engaging in competitive business activities.

b. Employee agrees that Employee shall not for Employee or for any other person, firm, corporation, partnership or other entity, for a period of one (1) year from the time Employee’s employment under this Agreement ceases or is terminated (for whatever reason), directly or indirectly

c. i. solicit any sales agent, employee, former employee who was employed by the Company in the preceding 180 days or full-time consultant of the Company for the purposes of hiring or retaining such sales agent, employee or consultant,

ii. contact any present or prospective client of the Company to solicit such a person to enter into a contract or arrangement with any competitor of the Company, or

iii. make known the names and/or addresses of such clients or any information relating in any manner to the Company’s trade or business relationships with such clients.

d. Employee further agrees that Employee shall not, either during the employment term or at any time thereafter, in any way disparage the Company.

11. OWNERSHIP OF DEVELOPMENTS

a. All copyrights, patents, trade secrets, or other intellectual property rights associated with any ideas, concepts, techniques, inventions, processes, or works of authorship develop or created by Employee during the course of performing work for the Company or its clients (collectively, the “Work Product”) shall belong exclusively to the Company and shall, to the extent possible, be considered a work made by Employee for hire for the Company within the meaning of Title 17 of the United States Code. To the extent the Work Product may not be considered work made by Employee for hire for the Company, Employee agrees to assign and automatically assigns to the Company at the time of creation of the Work Product, without any requirement of further consideration, any right, title, or interest Employee may have in such Work Product. Upon the request of the Company, Employee

shall take such further actions, including execution and delivery of instruments of conveyance, as may be appropriate to give full and proper effect to such assignment.

b. Solely for purposes of Sections 9, 10, 11 and 12 hereof only, the term “Company” also shall include any existing or future subsidiaries of the Company that are operating during the time periods described herein and any other entities that directly or indirectly, through one or more intermediaries, control, are controlled by or are under common control with the Company during the periods described herein.

12. INJUNCTIVE RELIEF

a. Employee acknowledges and agrees that it would be difficult to fully compensate the Company for damages resulting from the breach or threatened breach of the covenants set forth in Sections 9, 10 and 11 of this Agreement and accordingly agrees that the Company shall be entitled to temporary and injunctive relief, including temporary restraining orders, preliminary injunctions and permanent injunctions, to enforce such provisions in any action or proceeding instituted in any court having subject matter jurisdiction, without having to post a bond or other security. This provision with respect to injunctive relief shall not, however, diminish the Company’s right to claim and recover damages. Employee agrees to pay to the Company all costs and expenses incurred by the Company relating to the enforcement of the terms of Sections 9, 10 and 11 hereof, including reasonable fees and disbursements of counsel (both at trial and appellate proceedings).

b. It is expressly understood and agreed that although the parties consider the restrictions contained in this Agreement to be reasonable, if a court determines that the time or territory or any other restriction contained in this Agreement is an unenforceable restriction on the activities of Employee, no such provision of this Agreement shall be rendered void but shall be deemed amended to apply as to such maximum time and territory and to such extent as such court may judicially determine or indicate to be reasonable.

c. Employee acknowledges and confirms that (a) the restrictive covenants contained in Sections 9 and 10 hereof are reasonably necessary to protect the legitimate business interests of the Company, and (b) the restrictions contained in Sections 9 and 10 hereof (including without limitation the length of the term of the provisions of Sections 9 and 10 hereof) are not overbroad, overlong, or unfair and are not the result of overreaching, duress or coercion of any kind. Employee further acknowledges and confirms that Employee’s full, uninhabited and faithful observance of each of the covenants contained in Sections 9 and 10 hereof shall not cause Employee any undue hardship, financial or otherwise, and that enforcement of each of the covenants contained herein shall not impair Employee’s ability to obtain employment commensurate with Employee’s abilities and on terms fully acceptable to Employee or otherwise to obtain income required for the comfortable support of Employee and Employee’s family and the satisfaction of the needs of Employee’s creditors. Employee acknowledges and confirms that Employee’s special knowledge of the business of the Company is such as would cause the Company serious injury or loss if Employee were to use such ability and knowledge to the benefit of a competitor or were to compete with the Company in violation of the terms of Sections 9 and 10 hereof. Employee

further acknowledges that the restrictions contained in Sections 9 and 10 hereof are intended to be, and shall be, for the benefit of and shall be enforceable by, the Company’s successors and assigns.

d. If Employee shall be in violation of any provision of Sections 9 and 10, then each time limitation set forth in the applicable section shall be extended for a period of time equal to the period of time during which such violation or violations occur. If the Company seeks injunctive relief from such violation in any court, then the time limitations shall be extended for a period of time equal to the pendency of such proceeding including all appeals by Employee.

13. SEPARABILITY. If any provision of this Agreement shall be declared to be invalid or unenforceable, in whole or in part, such invalidity or unenforceability shall not affect the remaining provisions hereof which shall remain in full force and effect.

14. ASSIGNMENT. This Agreement shall be binding upon and inure to the benefit of the heirs and representatives of Employee and the assigns and successors of the Company, but neither this Agreement nor any rights hereunder shall be assignable or otherwise subject to hypothecation by Employee.

15. ENTIRE AGREEMENT. This Agreement represents the entire agreement of the parties and shall supersede any and all previous contracts, arrangements or understandings between the Company and Employee. The Agreement may be amended at any time by mutual written agreement of the parties hereto.

16. GOVERNING LAW; VENUE. This Agreement shall be construed, interpreted, and governed in accordance with the laws of the State of Florida, other than the conflict of laws provisions of such laws. Hillsborough or Pinellas County, Florida shall be the proper venues for any litigation arising out of this Agreement.

17. COUNTERPARTS. This Agreement may be executed in one or more counterparts all of which taken together shall constitute one and the same instrument.

18. NOTICE. Any notice or other communication which is required or permitted under this Agreement shall be in writing and shall be deemed to have been given, delivered, or made, as the case may be (notwithstanding lack of actual receipt by the addressee) (i) on the date sent if delivered personally or by cable, telecopy, telegram, telex, or facsimile (which is confirmed), (ii) three (3) business days after having been deposited in the United States mail, certified or registered, return receipt requested, sufficient postage affixed and prepaid, or (iii) one (1) business day after having been deposited with a nationally recognized overnight courier service (such as by way of example, but not limitation, U.S. Express Mail, Federal Express, or Airborne), to the parties at the following addresses (or at such other address for a party as shall be specified by like notice):

If to the Company:	DrugMax, Inc.
	25400 U.S. Hwy 19 N. Ste 137 Clearwater, FL 33763 Attention: Chief Executive Officer

	(727) 533-0431
	Fax (727) 531-1280
With a copy to Counsel:	Shumaker, Loop & Kendrick LLP
	101 E. Kennedy Blvd. Suite 2800
	Tampa, Florida 33602
	Attention: Julio Esquivel

If to the Employee:
	Fax

IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed, and the Employee has hereunto set Employee’s hand, as of the day and year first above written.

DRUGMAX, INC.
By:	/s/    WILLIAM L. LAGAMBA
Name:	William L. LaGamba
Title:	President
EMPLOYEE:
	/s/    RONALD J. PATRICK
Name:	Ronald J. Patrick

EX-10.3

Exhibit 10.3

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT, dated effective as of April 1, 2003 (the “Agreement”), is by and between DrugMax, Inc., a Nevada corporation (the “Company”), and Jugal K. Taneja (the “Employee”).

WHEREAS, the Company is a full-line, wholesale distributor of pharmaceuticals, over-the-counter products, health and beauty care aids, and nutritional supplements;

WHEREAS, the Company wishes to assure itself of the services of Employee for the period provided in this Agreement and Employee is willing to serve in the employ of the Company for such period upon the terms and conditions hereinafter set forth.

NOW THEREFORE, in consideration of the mutual covenants herein contained, the parties, intending to be legally bound, hereby agree as follows:

1. EMPLOYMENT. The Company hereby agrees to employ Employee upon the terms and conditions herein contained, and Employee hereby accepts such employment for the term described below. Employee agrees to serve as the Chairman and Chief Operating Officer of the Company during the term of this Agreement and shall report to (title). In such capacity, Employee shall have such powers and responsibilities consistent with Employee’s position as the Chairman and Chief Executive Officer may assign to Employee. Throughout the term of this Agreement, Employee shall devote Employee’s best efforts and substantially all of Employee’s business time and services to the business and affairs of the Company.

2. TERM OF AGREEMENT. The three (3) year initial term of the employment under this Agreement shall commence as of the date set forth above (the “Effective Date”). After the expiration of such initial three-year period, the term of Employee’s employment hereunder shall automatically be extended without further action by the parties for successive one (1) year renewal terms, provided that if either party gives the other party at least thirty (30) days advance written notice prior to the expiration of the then current term of such party’s intention to not renew this Agreement for an additional term, the Agreement shall terminate upon the expiration of the current term.

3. SALARY AND BONUS

a. Employee shall receive an annual base salary during the term of this Agreement of $200,000, payable in installments consistent with the Company’s normal payroll schedule; provided that the annual base salary shall be subject to periodic review and adjustment by the Compensation Committee and/or the Board of Directors of the Company in its discretion.

b. Employee shall also be eligible to participate in any executive bonus plan created by the Board of Directors in the same manner and to the same extent as the other executives of the Company in the discretion of the Board of Directors.

4. WELFARE AND FRINGE BENEFITS.

a. Life Insurance. The Company shall pay a maximum of $1,000 per year towards a redeemable life insurance policy on the life of Employee, the proceeds of which shall be payable to Employee’s family.

b. Automobile and Other Allowances. During the term hereof, the Company shall also provide Employee with an automobile allowance of up to $750.00 per month and a club allowance of up $ 300.00 per month and also shall pay the dues on behalf of Employee for one airline club membership per year.

c. Expenses. The Company shall reimburse Employee for all reasonable expenses he incurs in promoting the Company’s business, including expenses for travel, entertainment of business associates, service and usage charges for business use of cellular phones and similar items, upon presentation by Employee from time to time of an itemized account of such expenditures in a form acceptable to the Company.

d. Vacation. Employee shall be entitled to an annual vacation of not less than four weeks, during which time his compensation shall be paid in full.

e. General. Employee shall be eligible to participate in such welfare benefit plans, programs, practices and policies of the Company as are generally applicable to other employees. Without limiting the foregoing, Employee shall be entitled to such other benefits as the Board of Directors and/or any Compensation and Stock Option Committee of the Board of Directors may from time to time approve for him.

5. TERMINATION

a. Involuntary Termination. The Company may terminate Employee’s employment hereunder at any time by giving written notice to Employee of termination. However, if Employee’s employment is terminated by the Company during the term of this Agreement pursuant to this Section 5(a), Employee shall be entitled to receive Employee’s base salary accrued through the date of termination plus one additional year of base salary payable in the same manner as base salary was previously paid to Employee.

b. Disability. The Company shall be entitled to terminate Employee’s employment immediately if Employee becomes disabled (as defined below). Upon such termination, the amount Employee shall be entitled to receive from the Company shall be limited to Employee’s base salary accrued through the date of termination and any payments as may be provided under any long-term disability plan or other disability program or insurance policies maintained or provided by the Company. “Disabled” shall mean that for a period of three (3) consecutive months or an aggregate of four (4) months in any twelve (12) month period Employee is incapable of fulfilling the duties of his or her position because of physical, mental or emotional incapacity, injury, sickness or disease. Any question as to the existence or extent of the disability upon which Employee and the Company cannot agree shall be determined by a qualified, independent physician selected by the Company. The determination of any such physician shall be final and conclusive for all purposes.

c. Termination for Cause. The Company may terminate Employee’s employment hereunder for Cause (as defined below) immediately without notice. If Employee’s employment is terminated by the Company for Cause, the amount Employee shall be entitled to receive from the Company shall be limited to Employee’s base salary accrued through the date of termination.

For purposes of this Agreement, the term “Cause” shall be limited to (i) embezzlement, fraud, misappropriation of corporate assets or a breach of the covenants set forth in Sections 9, 10 and 11 below; (ii) Employee being arrested or indicted in connection with a felony; (iii) Employee being arrested or indicted of any lesser crime or offense committed in connection with the performance of Employee’s duties hereunder or involving moral turpitude; (iv) the habitual failure or refusal by Employee to perform Employee’s duties hereunder after being provided with written warnings and a reasonable period to cure; or (v) chronic absenteeism.

d. Voluntary Termination by Employee. If Employee resigns or otherwise voluntarily terminates Employee’s employment before the end of the current term of this Agreement, other than pursuant to the provisions of Section 5(e) of this Agreement, the amount Employee shall be entitled to receive from the Company shall be limited to Employee’s base salary accrued through the date of termination.

e. Termination for Good Reason by Employee. Employee may terminate this Agreement for “Good Reason” (as defined below), provided that he shall first provide the Company with prior written notice, which notice shall state with specificity the reason for the termination and provide the Company with thirty (30) days from and after the giving of such notice to cure the breach. If the Company fails to cure the breach within such thirty days, Employee shall be entitled to receive Employee’s base salary accrued through the date of termination plus one additional year of base salary payable in the same manner as base salary was previously paid to Employee. For purposes of Section 5(e), the Executive shall have “Good Reason” to terminate his employment hereunder if such termination shall be the result of:

(i) any material demotion regarding Employee’s status, title, authorities or responsibilities (including reporting responsibilities) under this Employment Agreement; or

(ii) the reassignment of Employee to a location more than fifty (50) miles from the location where he presently works.

6. DEATH. If Employee dies during the term of this Agreement, the Company shall pay to Employee’s estate a lump sum payment equal to the sum of Employee’s base salary accrued through the date of death plus the total unpaid amount of any bonuses earned. In addition, the death benefits payable by reason of Employee’s death under any retirement, deferred compensation or other employee benefit plan maintained by the Company shall be paid to the beneficiary designated by Employee in accordance with the terms of the applicable plan or plans.

7. CHANGE OF CONTROL.

a. Salary. Upon a Change in Corporate Control (as defined below), if there is a reduction in the Employee’s base salary, the Employee shall have the option to terminate his Employment and should Employee elect to terminate his Employment, the Company shall be obligated to make a series of twelve (12) monthly payments to the Employee. Each monthly payment shall be equal to the sum of one-twelfth ( ¹/12^th) of the Employee’s annual base salary, as in effect on the date of termination, provided that if the Employee obtains a replacement position with any new employer (including a position as an officer, employee, consultant, or agent, or self-employment as a partner or sole proprietor), the payments shall be reduced by all amounts the Employee receives as compensation for services performed during such period.

b. Stock Options. Further, upon a Change in Corporate Control, the vesting of any stock options granted to the Employee under the terms of the Company’s Stock Option Plan shall become immediately vested in full and exercisable in full.

c. Definition. For purposes of this Agreement, a “Change in Corporate Control” shall include any of the following events: i. The acquisition in one or more transactions of more than forty percent (40%) of the Company’s outstanding Common Stock by any corporation, or other person or group (within the meaning of Section 14(d)(3) of the Securities Exchange Act of 1934, as amended), with the exclusion of Jugal K. Taneja or any person, group, corporation, or affiliates thereof, which are controlled by Jugal K. Taneja.

ii. Any merger or consolidation of the Company into or with another corporation in which the Company is not the surviving entity, or any transfer or sale of substantially all of the assets of the Company or any merger or consolidation of the Company into or with another corporation in which the Company is the surviving entity and, in connection with such merger or consolidation, all or part of the outstanding shares of Common Stock shall be changed into or exchanged for other stock or securities of any other person, or cash, or any other property, with the exclusion of any mergers with any person, group, corporation, or affiliates thereof which are controlled by Jugal K. Taneja

iii. Any person, or group of persons, announces a tender offer for at least forty percent (40%) of the Company’s Common Stock, with the exclusion of Jugal K. Taneja or any person, group, corporation, or affiliates thereof, which are controlled by Jugal K. Taneja.

d. Limitation. Notwithstanding anything else in this Agreement, the amount of severance compensation payable to the Employee as a result of a Change in Corporate Control under this Section 7, or otherwise, shall be limited to the maximum amount the Company would be entitled to deduct pursuant to Section 280G of the Internal Revenue Code of 1986, as amended.

8. WITHHOLDING. The Company shall, to the extent permitted by law, have the right to withhold and deduct from any payment hereunder any federal, state or local taxes of any kind required by law to be withheld with respect to any such payment.

9. PROTECTION OF CONFIDENTIAL INFORMATION. Employee agrees that Employee shall keep all confidential or proprietary information of the Company or relating to its business (including, but not limited to, information regarding the Company’s customers, vendors, pricing policies, methods of operation, proprietary computer programs and trade secrets) confidential, and that Employee shall not (except with the Company’s prior written consent), while in the employ of the Company or thereafter, disclose any such confidential information to any person, firm, corporation, association or other entity, other than in furtherance of Employee’s duties hereunder, and then only to those with a need to know. Employee shall not make use of any such confidential information for Employee’s own purposes or for the benefit of any person, firm, corporation, association or other entity (except the Company) under any circumstances during or after the term of Employee’s employment. The foregoing shall not apply to any information which, is generally disclosed to the public by the Company or is otherwise in the public domain at the time of disclosure.

Employee recognizes that because Employee’s work for the Company shall bring Employee into contact with confidential and proprietary information of the Company, the restrictions of this Section 9 are required for the reasonable protection of the Company and its investments and for the Company’s reliance on and confidence in Employee.

Further, Employee agrees that upon request or upon termination of this Agreement (for any reason), Employee shall deliver to the Company any and all

drawings, notes, documents and other materials which he has received from the Company or which have originated from the employment activity.

10. COVENANT NOT TO COMPETE

a. Employee hereby agrees that Employee shall not, either during the employment term or during a period of one (1) year from the time Employee’s employment under this Agreement ceases or is terminated (for whatever reason), engage in any business activities on behalf of any enterprise which competes with the Company. Employee shall be deemed to be engaged in such competitive business activities if Employee participates in such a business enterprise as an employee, officer, director, consultant, agent, partner, proprietor, or other participant; provided that the ownership of no more than 2 percent of the stock of a publicly traded corporation engaged in a competitive business shall not be deemed to be engaging in competitive business activities.

b. Employee agrees that Employee shall not for Employee or for any other person, firm, corporation, partnership or other entity, for a period of one (1) year from the time Employee’s employment under this Agreement ceases or is terminated (for whatever reason), directly or indirectly

c. i. solicit any sales agent, employee, former employee who was employed by the Company in the preceding 180 days or full-time consultant of the Company for the purposes of hiring or retaining such sales agent, employee or consultant,

ii. contact any present or prospective client of the Company to solicit such a person to enter into a contract or arrangement with any competitor of the Company, or

iii. make known the names and/or addresses of such clients or any information relating in any manner to the Company’s trade or business relationships with such clients.

d. Employee further agrees that Employee shall not, either during the employment term or at any time thereafter, in any way disparage the Company.

11. OWNERSHIP OF DEVELOPMENTS

a. All copyrights, patents, trade secrets, or other intellectual property rights associated with any ideas, concepts, techniques, inventions, processes, or works of authorship develop or created by Employee during the course of performing work for the Company or its clients (collectively, the “Work Product”) shall belong exclusively to the Company and shall, to the extent possible, be considered a work made by Employee for hire for the Company within the meaning of Title 17 of the United States Code. To the extent the Work Product may not be considered work made by Employee for hire for the Company, Employee agrees to assign and automatically assigns to the Company at the time of creation of the Work Product, without any requirement of further consideration, any right, title, or interest Employee may have in such Work Product. Upon the request of the Company, Employee

shall take such further actions, including execution and delivery of instruments of conveyance, as may be appropriate to give full and proper effect to such assignment.

b. Solely for purposes of Sections 9, 10, 11 and 12 hereof only, the term “Company” also shall include any existing or future subsidiaries of the Company that are operating during the time periods described herein and any other entities that directly or indirectly, through one or more intermediaries, control, are controlled by or are under common control with the Company during the periods described herein.

12. INJUNCTIVE RELIEF

a. Employee acknowledges and agrees that it would be difficult to fully compensate the Company for damages resulting from the breach or threatened breach of the covenants set forth in Sections 9, 10 and 11 of this Agreement and accordingly agrees that the Company shall be entitled to temporary and injunctive relief, including temporary restraining orders, preliminary injunctions and permanent injunctions, to enforce such provisions in any action or proceeding instituted in any court having subject matter jurisdiction, without having to post a bond or other security. This provision with respect to injunctive relief shall not, however, diminish the Company’s right to claim and recover damages. Employee agrees to pay to the Company all costs and expenses incurred by the Company relating to the enforcement of the terms of Sections 9, 10 and 11 hereof, including reasonable fees and disbursements of counsel (both at trial and appellate proceedings).

b. It is expressly understood and agreed that although the parties consider the restrictions contained in this Agreement to be reasonable, if a court determines that the time or territory or any other restriction contained in this Agreement is an unenforceable restriction on the activities of Employee, no such provision of this Agreement shall be rendered void but shall be deemed amended to apply as to such maximum time and territory and to such extent as such court may judicially determine or indicate to be reasonable.

c. Employee acknowledges and confirms that (a) the restrictive covenants contained in Sections 9 and 10 hereof are reasonably necessary to protect the legitimate business interests of the Company, and (b) the restrictions contained in Sections 9 and 10 hereof (including without limitation the length of the term of the provisions of Sections 9 and 10 hereof) are not overbroad, overlong, or unfair and are not the result of overreaching, duress or coercion of any kind. Employee further acknowledges and confirms that Employee’s full, uninhabited and faithful observance of each of the covenants contained in Sections 9 and 10 hereof shall not cause Employee any undue hardship, financial or otherwise, and that enforcement of each of the covenants contained herein shall not impair Employee’s ability to obtain employment commensurate with Employee’s abilities and on terms fully acceptable to Employee or otherwise to obtain income required for the comfortable support of Employee and Employee’s family and the satisfaction of the needs of Employee’s creditors. Employee acknowledges and confirms that Employee’s special knowledge of the business of the Company is such as would cause the Company serious injury or loss if Employee were to use such ability and knowledge to the benefit of a competitor or were to compete with the Company in violation of the terms of Sections 9 and 10 hereof. Employee

further acknowledges that the restrictions contained in Sections 9 and 10 hereof are intended to be, and shall be, for the benefit of and shall be enforceable by, the Company’s successors and assigns.

d. If Employee shall be in violation of any provision of Sections 9 and 10, then each time limitation set forth in the applicable section shall be extended for a period of time equal to the period of time during which such violation or violations occur. If the Company seeks injunctive relief from such violation in any court, then the time limitations shall be extended for a period of time equal to the pendency of such proceeding including all appeals by Employee.

13. SEPARABILITY. If any provision of this Agreement shall be declared to be invalid or unenforceable, in whole or in part, such invalidity or unenforceability shall not affect the remaining provisions hereof which shall remain in full force and effect.

14. ASSIGNMENT. This Agreement shall be binding upon and inure to the benefit of the heirs and representatives of Employee and the assigns and successors of the Company, but neither this Agreement nor any rights hereunder shall be assignable or otherwise subject to hypothecation by Employee.

15. ENTIRE AGREEMENT. This Agreement represents the entire agreement of the parties and shall supersede any and all previous contracts, arrangements or understandings between the Company and Employee. The Agreement may be amended at any time by mutual written agreement of the parties hereto.

16. GOVERNING LAW; VENUE. This Agreement shall be construed, interpreted, and governed in accordance with the laws of the State of Florida, other than the conflict of laws provisions of such laws. Hillsborough or Pinellas County, Florida shall be the proper venues for any litigation arising out of this Agreement.

17. COUNTERPARTS. This Agreement may be executed in one or more counterparts all of which taken together shall constitute one and the same instrument.

18. NOTICE. Any notice or other communication which is required or permitted under this Agreement shall be in writing and shall be deemed to have been given, delivered, or made, as the case may be (notwithstanding lack of actual receipt by the addressee) (i) on the date sent if delivered personally or by cable, telecopy, telegram, telex, or facsimile (which is confirmed), (ii) three (3) business days after having been deposited in the United States mail, certified or registered, return receipt requested, sufficient postage affixed and prepaid, or (iii) one (1) business day after having been deposited with a nationally recognized overnight courier service (such as by way of example, but not limitation, U.S. Express Mail, Federal Express, or Airborne), to the parties at the following addresses (or at such other address for a party as shall be specified by like notice):

If to the Company:	DrugMax, Inc.
	25400 U.S. Hwy 19 N. Ste 137
	Clearwater, FL 33763
	Attention: Chief Executive Officer

	(727) 533-0431
	Fax (727) 531-1280
With a copy to Counsel:	Shumaker, Loop & Kendrick LLP
	101 E. Kennedy Blvd. Suite 2800
	Tampa, Florida 33602
	Attention: Julio Esquivel

If to the Employee:
	Fax

IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed, and the Employee has hereunto set Employee’s hand, as of the day and year first above written.

DRUGMAX, INC.
By:	/s/    WILLIAM L. LAGAMBA
Name:	William L. LaGamba
Title:	President
EMPLOYEE:
	/s/    JUGAL K. TANEJA
Name:	Jugal K. Taneja

EX-99.1

EXHIBIT 99.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Amendment No 1. to the Annual Report of DrugMax, Inc. (the “Company”) on Form 10-K/A for the year ended March 31, 2003, as filed with the Securities and Exchange Commission on July 29, 2003 (the “Report”), I, Jugal K. Taneja, Chairman and Chief Executive Officer of the Company, certify pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1) The Report fully complies with requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

/s/    JUGAL K. TANEJA

Jugal K. Taneja

Chief Executive Officer

July 29, 2003

EX-99.2

EXHIBIT 99.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Amendment No. 1 to the Annual Report of DrugMax, Inc. (the “Company”) on Form 10-K/A for the year ended March 31, 2003, as filed with the Securities and Exchange Commission on July 29, 2003 (the “Report”), I, Ronald J. Patrick, Chief Financial Officer of the Company, certify pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1) The Report fully complies with requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

/s/    RONALD J. PATRICK

Ronald J. Patrick

Chief Financial Officer,

Principal Financial and Accounting Officer

July 29, 2003