ASSET PURCHASE AGREEMENT

Exhibit 10.31

ASSET PURCHASE AGREEMENT

This ASSET PURCHASE AGREEMENT dated as of December 9, 2005, is by and between MEDICINE MADE EASY, a California corporation (“Buyer”), and PRIORITY PHARMACY, INC., a California corporation (“Seller”), The David C. Zeiger Trust UTD 4/30/93 (the “Seller’s Shareholder”), David C. Zeiger (“David”) and Peter Ellman (“Peter”).

Seller is a licensed California pharmacy located at 3935 First Avenue, San Diego, California.

Buyer desires to purchase and Seller desires to sell, transfer and deliver to Buyer Seller’s right title and interest in and to certain of its business and assets used in connection with or related to its HIV/AIDS business, including without limitation its inventory, customer lists, books and records, files and goodwill used in connection with or related to its HIV/AIDS business, on the terms and conditions set forth in this Agreement.

The parties agree as follows:

ARTICLE I

DEFINITIONS

The terms defined in this Article I, whenever used herein (including the schedules hereto, unless otherwise defined therein), shall have the following meanings:

1.1 “ Additional Payments ” shall have the meaning set forth in Section 2.2(b) of this Agreement

1.2 “ Affiliate ” shall mean any Person that directly or indirectly controls, is controlled by or is under common control with another Person.

1.3 “ Acquired Assets ” shall mean all of Seller’s right, title and interest in and to its Inventory, supplies, packaging and shipping materials, manufacturers warranties, customer lists, books and records, files and goodwill used in connection with or related to its HIV/AIDS business.

1.4 “ Business Day ” shall mean any day other than a Saturday, Sunday or other day on which banks are closed or are authorized to be closed in New York, New York.

1.5 “ Buyer Claimant ” shall have the meaning set forth in Section 8.2 of this Agreement.

1.6 “ Closing ” shall mean the closing of the purchase and sale of the Acquired Assets, as contemplated by this Agreement.

1.7 “ Closing Date ” shall have the meaning set forth in Section 3.1 of this Agreement.

1.8 “ Code ” shall mean the Internal Revenue Code of 1986, as amended.

1.9 “ Contract ” shall have the meaning set forth in Section 4.3 of this Agreement.

1.10 “ Employee Benefit Plan ” means any “employee benefit plan” within the meaning of Section 3(3) of ERISA, and any other bonus, profit sharing, compensation, pension, severance, deferred compensation, fringe benefit, insurance, welfare, medical, post-retirement health or welfare benefit, medical reimbursement, health, life, stock option, stock purchase, tuition refund, service award, company car, scholarship, relocation, disability, accident, sick pay, sick leave, vacation, termination, individual employment, executive compensation, incentive, bonus, commission, payroll practices, retention or other plan, agreement, policy, trust fund or arrangement, whether written or unwritten, and whether maintained, sponsored or contributed to by Seller or any entity that would be deemed a “single employer” with Seller under Section 414(b), (c), (m) or (o) of the Code or Section 4001(a)(14) of ERISA (an “ERISA Affiliate”) on behalf of any of the current, former or retired employees of Seller or its beneficiaries or with respect to which Seller or any ERISA Affiliate has or has had any obligation on behalf of any such employee or beneficiary.

1.11 “ Encumbrance ” shall mean any lien, charge, encumbrance, option, right of first refusal, security interest, easement, obligation or claim or other third party right of any kind.

1.12 “ Environment ” shall mean any surface or subsurface physical medium or natural resource, including, air, land, soil, surface waters, ground waters, stream and river sediments, and biota.

1.13 “ Environmental Laws ” shall mean any federal, state, local or foreign law, rule, regulation, ordinance, code, order or judgment (including the common law and any judicial or administrative interpretations, guidances, directives or opinions) relating to the injury to, or the pollution or protection of human health and safety or the Environment.

1.14 “ Environmental Liabilities ” shall mean any claims, judgments, damages (including punitive damages), losses, penalties, fines, liabilities, encumbrances, liens, violations, costs and expenses (including attorneys and consultants fees) of investigation, remediation or defense of any matter relating to human health, safety or the Environment of whatever kind or nature by any party, entity or authority, (a) which are incurred as a result of (i) the existence of Hazardous Substances in, on, under, at or emanating from any real property presently or formerly owned or operated by Seller or any of its Affiliates, (ii) the offsite transportation, treatment, storage or disposal of Hazardous Substances generated by Seller or any of its Affiliates, or (iii) the violation of any Environmental Laws or (b) which arise under the Environmental Laws.

1.15 “ ERISA ” shall mean the Employee Retirement Income Security Act of 1974, as amended, and the regulations thereunder.

1.16 “ ERISA Affiliate ” shall have the meaning set forth in the definition of “Employee Benefit Plan”.

1.17 “ Excluded Liabilities ” shall have the meaning set forth in Section 2.1(c) of this Agreement.

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1.18 “ Financial Statements ” shall mean (a) the unaudited financial statements of the Seller as of December 31, 2002, 2003 and 2004, and for each of the fiscal years then ended, (b) the unaudited financial statements of the Seller as of August 31, 2005, and for the eight month period then ended.

1.19 “ GAAP ” shall mean generally accepted accounting principles.

1.20 “ Hazardous Discharge ” shall mean any releasing, spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, migrating, disposing or dumping (including the movement of any material through or in air, soil, surface or groundwater) of Hazardous Substances, whether on, off, under or from any real property owned, operated, leased or used at any time by Seller or its predecessors.

1.21 “ Hazardous Substances ” shall mean petroleum, petroleum products, petroleum-derived substances, radioactive materials, hazardous wastes, polychlorinated biphenyls, lead based paint, urea formaldehyde, asbestos or any materials containing asbestos, and any materials, wastes or substances regulated or defined as or included in the definition of “hazardous substances,” “hazardous materials,” “hazardous constituents,” “toxic substances,” “pollutants,” “contaminants” or any similar denomination intended to classify substances by reason of toxicity, carcinogenicity, ignitability, corrosivity or reactivity under any Environmental Laws.

1.22 “ Indemnitee ” and “ Indemnitor ” shall have the meanings set forth in Section 8.4(a) of this Agreement.

1.23 “ Initial Payment ” shall have the meaning set forth in Section 2.2(a) of this Agreement.

1.24 “ Inventory ” means Seller’s inventory related to its HIV/AIDS business.

1.25 “ Inventory Payment ” shall have the meaning set forth in Section 2.2(b) of this Agreement.

1.26 “ IRS ” shall mean the Internal Revenue Service

1.27 “ Licenses and Permits ” shall have the meaning set forth in Section 4.8 of this Agreement.

1.28 “ Losses ” shall have the meaning set forth in Section 8.2 of this Agreement.

1.29 “ Material Adverse Effect ” shall mean any material adverse effect, individually or in the aggregate, on the condition (financial or otherwise), business, assets, operations or prospects of Seller or the Acquired Assets.

1.30 “ Monthly Information ” shall mean the gross revenue and prescription count information for Seller for the months of September, October and November 2005.

1.31 “ Payment Program ” shall have the meaning set forth in Section 4.13 of this Agreement.

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1.32 “ Person ” shall mean any natural person, corporation, professional corporation, limited or limited liability partnership, general partnership, joint venture, association, joint-stock company, limited liability company, company, trust, bank, trust company, land trust, business trust or other organization, whether or not a legal entity, and any governmental unit or agency or political subdivision thereof.

1.33 “ Purchase Price ” shall have the meaning set forth in Section 2.2(b) of this Agreement.

1.34 “ Related Party ” shall have the meaning set forth in Section 4.10 of this Agreement.

1.35 “ Seller Claimant ” shall have the meaning set forth in Section 8.3 of this Agreement.

1.36 “ Taxes ” (or “Tax” where the context requires) shall mean all federal, state, local, foreign or other taxes, duties, or similar charges (including, without limitation, income (whether net or gross), profits, premium, estimated, excise, sales, use, environmental (including taxes under Code Section 59A), occupancy, franchise, license, value added stamp, windfall profits, social security, gross receipts, franchise, ad valorem, severance, capital levy, production, transfer, gains, withholding, occupation, employment and payroll related and property taxes, alternative or add-on, minimum or estimated, import and export duties and other governmental charges and assessments) imposed by any taxing or governmental authority on or payable by Seller or any other party with respect to the income, operations, products, assets or properties of Seller, whether attributable to statutory or nonstatutory rules and whether or not measured in whole or in part by net income, and including interest, additions to tax or interest, and penalties with respect thereto, and including expenses associated with contesting any proposed adjustment related to any of the foregoing.

ARTICLE II

SALE AND PURCHASE OF THE ACQUIRED ASSETS

2.1  Purchase of the Acquired Assets .

(a) Upon the terms and subject to the conditions hereof, and upon the basis of the agreements, representations and warranties contained in, and the schedules to, this Agreement, at the Closing, Seller shall sell, transfer, assign, convey and deliver to Buyer, and Buyer shall purchase and acquire from Seller, all of the Acquired Assets, in each case free and clear of Encumbrances of any kind.

(b) Notwithstanding anything contained in this Agreement, Seller shall not sell, transfer, assign, convey or deliver to Buyer, and Buyer shall not purchase or acquire from Seller, any of Seller’s cash or accounts receivable, and any other assets of Seller other than the Acquired Assets.

(c) Buyer shall not be required to assume, pay, fulfill, perform or otherwise discharge any liabilities or obligations of Seller, including of Seller’s business, of any kind

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whatsoever (the “Excluded Liabilities”), and Seller shall pay, fulfill, perform and discharge such Excluded Liabilities. The Excluded Liabilities include, without limitation:

(i) Legal, accounting, brokerage, finder’s fees, Taxes or other expenses incurred by Seller or any Affiliate, including, without limitation, in connection with this Agreement or the consummation of the transactions contemplated hereby;

(ii) Any intercompany debt or other liability or obligation of any nature between Seller and any past or present Related Party of Seller;

(iii) Liabilities or obligations incurred by Seller or any Affiliate of Seller after the Closing;

(iv) Any obligation or liability relating to any litigation or any claim arising out of any dispute, the elements of which occurred prior to the Closing, whether or not listed on any schedule hereto and regardless of whether accruing prior to or subsequent to the Closing;

(v) Any liability for any Taxes accrued to or incurred by Seller or any Affiliate of Seller or relating to operations, products or assets of Seller or any Affiliate of Seller or arising as a consequence of the transactions contemplated hereby;

(vi) Any liability or costs (including, without limitation, costs of remediation) arising out of or relating to a Hazardous Discharge or the release, discharge or disposal of any solid wastes or the handling, storage, use, transportation or disposal of any of the foregoing, as these terms are defined by the Environmental Laws in, on, under or from facilities of Seller at any time prior to the Closing, regardless of whether such liability or costs arise before or after Closing and whether or not in breach of any representation or warranty under this Agreement;

(vii) Any liability or obligation to employees, government agencies or other third parties in connection with any option plan, pension plan, other ERISA plan or other Employee Benefit Plan, and any health, dental or life insurance benefits, whether or not insured and whether or not disclosed on any schedule hereto;

(viii) Any liability or obligation under any contract or commitment, including which relates to any default in respect of such contract or other commitment or obligation of Seller;

(ix) Any liability or obligation to employees in the nature of accrued payroll, vacation, holiday or sick pay, worker’s compensation relating to the period prior to the Closing, whether or not listed on any schedule hereto and regardless of whether accruing prior or subsequent to the Closing;

(x) Any trade debt, accounts payable, notes payable and bank debts; or

(xi) Any other liability or obligation.

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2.2  Purchase Price .

(a) At the Closing, in consideration for the Acquired Assets (other than the Inventory), Buyer shall pay to Seller an amount in cash equal to Six Million Five Hundred Thousand Dollars ($6,500,000) (the “Initial Payment”).

(b) In addition, (i) on each of January 8, 2006, February 8, 2006 and March 8, 2006, in consideration for the Acquired Assets (other than the Inventory), Buyer shall pay to Seller an amount equal to Three Hundred Sixty-Six Thousand, Six Hundred Sixty-Seven Dollars ($366,667) (the “Additional Payments”) if, and only if, (A) Seller, David and Peter have, during such three (3) month period, provided during normal business hours such reasonable assistance to Buyer as Buyer from time to time has requested to transition the business of Seller and the Acquired Assets to Buyer and (B) Seller has delivered to Buyer within ten (10) days after the Closing Date a legal opinion of counsel to Seller and Seller’s Shareholder, covering the matters set forth in Exhibit A ; and (ii) no later than on December 20, 2005, in consideration for the Inventory, Buyer shall pay to Seller an amount equal to the wholesale acquisition cost (as calculated by Buyer based on its inventory to be concluded by December 16, 2005 and documentation provided by Seller to Buyer), less two percent (2%) of such wholesale acquisition cost, of the Inventory that Buyer in its sole discretion elects by close of business on December 16, 2005, by notice to Seller, to purchase and acquire from Seller (the “Inventory Payment” and, collectively with the Initial Payment and the Additional Payments, the “Purchase Price”). The Inventory shall be shipped F.O.B. seller’s facility in San Diego, California.

(c) Buyer shall provide written notice to Seller if it reasonably determines that Seller is not fulfilling its obligations under Section 2.2(b)(i)(A), which notice shall specify in reasonable detail Buyer’s reasons for its belief that Sellers is not so fulfilling its obligations, in which case Seller shall have ten (10) business days from the date such notice is effective to cure such performance. If such performance is not cured within such ten (10) business day period, Buyer shall have no obligation to make the remaining payments due under Section 2.2(b)(i)(A). If a dispute arises between the parties relating to the cure of Seller’s performance under Section 2.2(b)(i)(A), such dispute shall be settled by a panel of three arbitrators with such arbitration to be held in San Diego, California, in accordance with the Commercial Arbitration Rules of the American Arbitration Association, and judgment upon the award rendered by the arbitrators may be entered in any court having jurisdiction thereof. The decision of the arbitrators shall be final and may be sued on or enforced by the party in whose favor it runs in any court of competent jurisdiction at the option of the successful party. In the event the arbitrators determine that Buyer wrongfully failed to make payments to Seller under this Section 2.2(c), or if Buyer does not make the Inventory Payment to Seller when due, Buyer shall, in additional to making such payments to Seller, pay to Seller interest thereon at a rate of interest equal to fifteen percent (15%) per annum beginning on the date such payments were originally due and continuing until any such payments are made in full.

2.3 Allocation of Purchase Price . The Purchase Price for the Acquired Assets shall be allocated for federal, state, local and foreign tax purposes by each party among the Acquired Assets as mutually determined by Seller and Buyer, in compliance with applicable laws and generally accepted accounting principles. For all pertinent tax purposes, each party hereto shall report the purchase and sale provided for, and with the characterization given these transactions in this Agreement, to taxing authorities on a basis consistent with such allocation, and each party agrees not to take a position inconsistent with such allocation. After the Closing, Seller and Buyer each shall timely file form 8594 with the IRS detailing this allocation. In the event that Buyer determines, subject to Seller’s reasonable approval, that any adjustments to such allocation are

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necessary, Seller shall make such modifications as are necessary, reporting the same on Seller’s form 8594 (if required) or any tax report or return filed or to be filed by Seller in order to conform to Buyer’s allocation as adjusted.

ARTICLE III

CLOSING

3.1  The Closing . Subject to the terms and conditions of this Agreement, the Closing shall occur on December 9, 2005 (the “Closing Date”), at the offices of Buyer’s counsel, Nixon Peabody LLP, 990 Stewart Avenue, Garden City, New York.

3.2 Obligations of Seller . At the Closing, Seller shall deliver to Buyer the following:

(a) Copies of the resolutions of the Board of Directors and shareholders of Seller certified by the secretary or assistant secretary of Seller, which resolutions shall approve and authorize the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby.

(b) All consents to the assignment to Buyer of each of the Acquired Assets.

(c) Such other instruments of assignment and conveyance as may be necessary or appropriate to fully and effectively transfer to Buyer the Acquired Assets.

(d) All of the other documents and instruments required to be delivered by Seller.

3.3 Obligations of Buyer . At the Closing, Buyer shall deliver to Seller the following:

(a) The Initial Payment.

(b) Copies of the resolutions of the Board of Directors of Buyer certified by the secretary or assistant secretary of Seller, which resolutions shall approve and authorize the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby.

(c) All of the other documents and instruments required to be delivered by Buyer.

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ARTICLE IV

REPRESENTATIONS AND WARRANTIES REGARDING SELLER AND SELLER’S BUSINESS

Except as set forth on a disclosure schedule delivered by Seller to Buyer and attached hereto (the “Seller Disclosure Schedule”), Seller and Seller’s Shareholder hereby represent and warrant to Buyer, as of the date hereof, as follows:

4.1 Organization and Qualification . Seller is a corporation duly organized, validly existing and in good standing under the laws of the State of California, with full corporate power and authority to own, lease and operate its properties and assets and to conduct its business as it is now being conducted. Seller has no Affiliates, subsidiaries or equity interest in any other Person, except as set forth on Schedule 4.1. Seller is duly qualified and in good standing as a foreign corporation and has all requisite corporate power and authority to do business in the jurisdictions set forth on Schedule 4.1, which jurisdictions are the only jurisdictions wherein the character of the properties owned or leased or the nature of activities conducted by Seller make such qualification necessary. Seller’s Shareholder owns all the issued and outstanding capital stock of Seller.

4.2 Authority . Seller has all requisite power and authority to execute and deliver this Agreement and all documents, certificates, agreements, instruments and writings related hereto to which it is a party and to perform, carry out and consummate the transactions contemplated hereby and thereby. The execution, delivery and performance of this Agreement have been duly authorized by all necessary corporate action on the part of Seller. This Agreement has been duly and validly executed by Seller and constitutes the legal, valid and binding obligations of Seller, enforceable against Seller in accordance with its terms.

4.3 No Breach . Neither the execution and delivery of this Agreement by Seller nor the consummation of the transactions contemplated hereby will: (a) violate any provision of the Articles of Incorporation or Bylaws of Seller; (b) conflict with, result in a breach of or constitute a default (or an event which, with or without notice, lapse of time or both, would constitute a default) under and of Seller’s leases, agreements, arrangements, contracts, commitments or understandings, written or oral, relating to Seller’s HIV/AIDS business (collectively, the “Contracts”) or any other material agreement, document, certificate or other instrument to which Seller is a party or by which Seller or any of its properties or assets (including the Acquired Assets) is subject or bound; (c) result in the creation of, or give any party the right to create, any Encumbrance upon any of the Acquired Assets; (d) conflict with, violate, result in a breach of or constitute a default under any judgment, decree, order or process of any court or governmental authority; (e) conflict with or violate any material statute, law or regulation applicable to Seller or any of the Acquired Assets; or (f) require Seller to obtain any authorization, consent, approval or waiver from, or to make any filing with, any governmental or regulatory authority.

4.4 Financial Statements and Sales Information . Prior to the date hereof, Seller has delivered to Buyer the Financial Statements and Monthly Information attached hereto as Schedule 4.4(a). The Financial Statements: (a) were prepared from the books and records of Seller, which books and records have been maintained in accordance with all legal and accounting requirements and completely and accurately reflect all financial transactions of Seller, including, without limitation, the accounts

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receivable, accounts payable and revenue of Seller for the periods covered by and as at the dates of the Financial Statements; (b) were prepared in accordance with GAAP consistently applied; and (c) present fairly the financial condition of Seller and the results of its operations for the periods covered by, and as at the dates of, each of the Financial Statements. The statements of profit and loss included in the Financial Statements do not contain any material items of special or non-recurring income or other income not earned in the ordinary course of business except as expressly specified therein. All liabilities (whether accrued, unmatured, contingent or otherwise, and whether due or to become due) of Seller are set forth or adequately reserved against on the face of the most recent Financial Statements, except for liabilities incurred since the date thereof in the ordinary course of business as theretofore conducted, which liabilities are not, individually or in the aggregate, materially adverse to the condition (financial or otherwise), business, assets, operations or prospects of Seller. Seller is neither aware nor ought reasonably to be aware of any basis for the assertion against Seller of any materially adverse liability or loss contingency. The books and records of Seller are accurate and complete and have been maintained in accordance with good business practices. The Monthly Information is accurate and complete in all material respects, subject to normal e-log and other final adjustments.

4.5 Absen