EMPLOYMENT AGREEMENT

         THIS EMPLOYMENT AGREEMENT (“Agreement”) is entered into as of November 8, 2006 by and between AURIGA LABORATORIES, INC. , a Delaware corporation (the “Company”), and CHARLES R. BEARCHELL , an individual resident of the State of California (“Executive”).

W I T N E S S E T H

        In consideration of the mutual covenants and obligations herein set forth, the parties hereto agree as follows:

    1.     Engagement; Nature of Duties . The Company hereby engages Executive, for the period hereinafter set forth, to serve as Chief Financial Officer of the Company. In such capacity, Executive shall report to the Chief Executive Officer of the Company (“CEO”) and shall perform the duties and render the services for and on behalf of the Company customarily performed by a chief financial officer of a company, and as may be set forth from time to time in resolutions of, or other directives issued by, the Board of Directors of the Company and/or any committee or designee thereof (the “Board”) or the CEO (the “Services”).

    2.     Term . The term of employment pursuant to this Agreement shall be for a period of one (1) year (the “Term”) commencing on November 20, 2006 (the “Commencement Date”), unless sooner terminated in accordance with the provisions hereof. Thereafter, this Agreement shall automatically renew for successive periods of one (1) year each, unless sooner terminated in accordance with the provisions hereof, or unless notice is given by either party hereto of his or its intent not to renew this Agreement within sixty (60) days prior to the expiration of the then-current term.

    3.     Location . Executive shall not be required to relocate his primary place of employment outside of the greater Los Angeles County metropolitan area. Executive may, however, be required to travel to other locations at such times as may be reasonably necessary for the performance of his duties and responsibilities under this Agreement. Any such travel undertaken by Executive shall be at the Company’s expense and shall be reimbursed in accordance with the Company’s prevailing policy for reimbursing personnel, as the same may, from time to time, be adjusted or revised.

    4.     Performance of Duties . Executive agrees to perform such duties and render the Services to the best of his ability, devoting thereto his entire professional time, attention and energy exclusively to the business and affairs of the Company and its affiliates, as its business and affairs now exist and as they hereafter may be changed, and shall not during the term of his employment hereunder be engaged in any other business activity, whether or not such business activity is pursued for gain or profit; provided, however, that Executive may serve: (a) on civic or charitable boards or committees; and (b) with the prior written approval of the Board, boards of corporations or business enterprises, in each case so long as such activities do not interfere with the performance of Executive’s obligations under this Agreement.

    5.     Compensation and Benefits .

        (a)     Base Compensation . Beginning on the Commencement Date, the Company shall pay to Executive a base compensation (“Base Compensation”) in the amount of One Hundred Ninety-five Thousand Dollars ($195,000.00), payable in periodic installments in accordance with the Company’s prevailing policy for compensating personnel, as the same may, from time to time, be adjusted or revised.

        (b)     Bonus . Executive shall be eligible to earn an annual bonus. Commencing with the Company’s first full fiscal year following the Commencement Date, and for each subsequent fiscal year of the Company, the Board will set specific financial and other qualitative and quantitative performance targets and the amount of Executive’s bonus, when and as declared by the Board in its sole discretion, will range from a minimum of ten percent (10%) to a maximum amount equal to thirty percent (30%) of Executive’s Base Compensation (with a target bonus of thirty percent (30%) of the then-effective Base Compensation) depending on the Board’s (in consultation with the CEO) determination of Executive’s success in achieving the specified targets. The minimum bonus will be paid semi-annually commencing with the first full fiscal year following the Commencement Date. The financial and other quantitative and qualitative performance targets for each fiscal year shall be established in the first month of each fiscal year as part of the Company’s annual financial plan. The bonus payable to Executive for each fiscal year, if any is due, shall be paid to Executive, subject to normal withholding, promptly after the completion of the audit of the Company’s financial statements for such fiscal year. Such bonus shall be paid in the form of cash or registered equity securities of the Company. Nothing in this Section shall be construed as obligating the Company to pay Executive an annual bonus.

        (c)     Equity Incentives . Initially, the Board will grant an option to purchase seven hundred fifty thousand (750,000) shares of the Company’s Common Stock as set forth in a separate Notice of Stock Option Grant. If the Board grants additional stock or other equity incentives to senior executive-level employees of the Company, the Board shall consider granting stock or other equity incentives to Executive (during the Term of this Agreement), and in the amount and upon such terms and conditions as the Board shall, in its sole and absolute discretion, determine.

        (d)     Expense Reimbursement . The Company shall reimburse to Executive any and all reasonable expenses actually incurred by Executive in the performance of the Services during the Term, provided that such expenses are in accordance with any policies or directives of the Company regarding reimbursement of business expenses now or hereafter adopted by the Company, and subject to Executive providing appropriate supporting documentation, reasonably acceptable to the Company. Executive shall be reimbursed for any and all cellular phone expenses actually incurred by Executive in the performance of the Services during the Term, subject to Executive providing appropriate supporting documentation, reasonably acceptable to the Company.

        (e)     Health and Disability Insurance . Executive shall have the right to participate in, and be provided family coverage at the Company’s expense for, any health and disability insurance programs now or hereafter maintained by the Company for the benefit of its senior executive-level employees generally, subject only to any eligibility or membership restrictions of such programs.

2

        (f)     Other Benefits . Executive shall have the right to participate in any and all benefit, retirement or insurance programs now or hereafter maintained by the Company for the benefit of its senior executive-level employees generally, including the Company’s 401(k) plan (with matching benefits equal to three percent (3%) of Executive’s contributions thereto), subject only to any eligibility or membership restrictions of such programs.

        (g)     Vacation . During each year of the Term, Executive shall be entitled to vacation leave of four (4) weeks, without deduction of salary. Such vacation leave shall be taken at such time or times during the applicable year as may be mutually determined by Executive and the Company acting reasonably, having regard to the performance of Executive’s essential duties to the Company pursuant to the terms of this Agreement, and subject to the policies or directives of the Company regarding vacation leave now or hereafter adopted by the Company. Executive may accumulate unused vacation time from year to year.

        (h)     Automobile Allowance; Parking Reimbursement . During the Term, Executive shall receive an automobile allowance of Seven Hundred Fifty Dollars ($750.00) per month. In addition, the Company shall reimburse Executive for up to Three Hundred Dollars ($300.00) per month for parking expenses, to be reimbursed in accordance with the Company’s prevailing policy for reimbursing personnel, as the same may, from time to time, be adjusted or revised.

        (i)     Deduction and Withholding . All compensation and other benefits to or on behalf of Executive pursuant to this Agreement shall be subject to such deductions and withholding as may be agreed to by the Executive or required by applicable law.

    6.     Termination .

        (a)     This Agreement may be terminated by the Company with Cause (as defined below), which termination shall be effective upon written notice to Executive. As used herein, “Cause” shall mean:

            (i)     Executive’s conviction of a felony involving moral turpitude, other criminal acts or illegal acts that are, in the sole and absolute discretion of the Board, injuries to the Company;

            (ii)     Executive’s breach of any other term or provision of this Agreement; or

            (iii)     Executive’s breach of any term or provision of the Company’s then-current employee handbook on corporate policy or any other policy, rule or regulation issued by the Company and intended to be binding on the employees of the Company at any time and from time to time.

        (b)     If, during the term of this Agreement, the Company terminates Executive’s employment for any reason other than Cause, then the Company shall pay Executive his Base Salary for a period of twelve (12) months following his termination. Such Base Salary shall be paid at the rate in effect at the time of his termination of employment and in accordance with the Company’s standard payroll procedures.

3

        (c)     If, during the term of this Agreement, the Company terminates Executive’s employment for any reason other than Cause, then the vested portion of the shares of the Company’s Common Stock subject to the stock option referenced in Section 5(c) shall be determined by adding twelve (12) months to the actual length of his service with the Company.

        (d)     If, during the term of this Agreement, the Company terminates Executive’s employment for any reason other than Cause, and if Executive elects to continue health insurance coverage under the Consolidated Omnibus Budget Reconciliation Act (“COBRA”) for himself and, if applicable, his dependents, following the termination of his employment, then the Company shall pay the monthly premium under COBRA for Executive and, if applicable, such dependents, until the earliest of: (i) the first (1 ^st ) anniversary of the termination of employment; (ii) the expiration of Executive’s continuation coverage under COBRA; or (iii) the date at which Executive receives substantially equivalent health insurance coverage in connection with new employment or self-employment.

        (e)     This Agreement shall automatically terminate upon Executive’s permanent disability as a result of a physical or mental injury or disability, or death. As used herein, “permanent disability” shall mean Executive’s substantial inability to perform the Services with or without reasonable accommodations, as reasonably determined by a physician appointed by the Company, which inability continues for more than ninety (90) consecutive days, or for more than one hundred twenty (120) days in any 12-month period.

        (f)     In the event of the Company’s termination of Executive’s employment for Cause, or Executive’s voluntary termination of his employment for any reason, the Company may place Executive on paid administrative leave and/or bar or restrict his access to the Company’s facilities, contemporaneously with or at any time after the delivery of the termination notice.

    7.     Change of Control .

        (a)     Subject to Section 7(b), in the event of a Change of Control (as defined below), if the Company terminates the employment of Executive for any reason other than for Cause, at any time within the twelve (12)-month period immediately following a Change of Control, any and all options (whether incentive or non-qualified) held by Executive shall immediately vest and may be exercised thereafter in accordance with the terms of Executive’s applicable stock option agreement(s).

        (b)     If any portion of any severance benefits (if any) payable to Executive pursuant to this Agreement or any other payments to him in connection with a Change of Control (collectively, the “Total Payments”) constitute an Excess Parachute Payment (as defined below), then the Total Payments to be made to Executive shall be reduced such that the value of the Total Payments that Executive is entitled to receive shall be One Dollar ($1.00) less than the maximum amount that he may receive without becoming subject to the tax imposed by Section 4999 of the United States Internal Revenue Code of 1986, as amended (the “Code”), or which the Company may pay without loss of deduction under Code Section 280G(a).

4

        (c)     For purposes of this Agreement, a “Change of Control” of the Company means, and shall be deemed to have taken place, if: (i) a total change in executive management of the Company has occurred; (ii) any person or entity or group of affiliated persons or entities, including a group which is deemed a “person” by Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), after the date hereof first acquires in one or more transactions, at least one of which is after the date of this Agreement, ownership of fifty percent (50%) or more of the outstanding shares of any class of stock then entitled to vote in the election of directors of the Company; and (iii) as a result of, or in connection with, any such acquisition or any related proxy contest, cash tender or exchange offer, merger or other business combination, sale of all or substantially all of the assets of the Company or any combination of the foregoing transactions, hereinafter referred to as a “Transaction,” the persons who were directors of the Company immediately before the acquisition shall cease to constitute three-fourths of the membership of the Board or any successor to the Company during the period commencing with the consummation of the Transaction and ending on the first to occur of the first anniversary of such date or the conclusion of the next meeting of shareholders to elect directors, except to the extent that any new directors during such period were elected or nominated by at least three-fourths of such persons (or new directors who were so nominated or elected). “Ownership” means beneficial or record ownership, directly or indirectly, other than: (i) by a person owning such shares merely of record (such as a member of a securities exchange, a nominee, or a securities depositary system); (ii) by a person as a bona fide pledgee of shares prior to a default and determination to exercise powers as an owner of the shares; (iii) by a person who is not required to file statements on Schedule 13D by virtue of Rule 13d-1(b) of the Securities and Exchange Commission under the Exchange Act; or (iv) by a person who owns or holds shares as an underwriter acquired in connection with an underwritten offering pending and for purposes of their public resale or planned private placement in increments of less than such 50% amount. Without limitation, the right to acquire ownership shall not of itself constitute ownership of shares.

        (d)     For purposes of this Agreement, “Excess Parachute Payment” shall have the same meaning as such term has under Code Section 280G and any temporary, proposed or final regulations thereunder, and any Total Payments shall be valued as provided therein.

    8.     Beneficiary Designation . Executive may designate a beneficiary to receive any remaining compensation under Sections 6 and 7 in the event of Executive’s death after he becomes entitled to receive any compensation thereunder (the “Beneficiary”). Such designation shall be made by filing a written designation with the Board in such form as the Board may provide and may be changed by Executive from time to time by similar action. If no such designation is made by Executive or if Executive is not survived by his designated Beneficiary, any remaining compensation under Sections 6 and 7 at the time of Executive’s death shall be paid to Executive’s estate.

    9.     Obligations of Executive – Property Rights .

        (a)     As used in this Agreement, “Confidential Information” means any and all information disclosed to Executive or material proprietary to the Company or designated as Confidential Information by the Company and not generally known by non-Company personnel, which Executive develops or which Executive gains knowledge of or access through as a consequence of or through Executive’s employment by the Company (including information conceived, originated, discovered or developed in whole or in part by Executive, alone or jointly with others). “Confidential Information” includes, but is not limited to, the following types of information and other information of a similar nature (whether or not reduced to writing or placed in any tangible medium of expression): the Company’s products, processes, discoveries, ideas, concepts, techniques and services, including information relating to research, development, inventions, manufacture, purchasing, accounting, engineering, marketing, merchandising, selling, trade secrets, customer lists, price lists, pricing policies, financial information, employee files or any other information that the Company maintains as confidential. “Confidential Information” also includes any information described aforesaid which the Company obtains from another party and which the Company treats as proprietary or designates as Confidential Information, whether or not owned or developed by the Company.

5

        (b)     Except as required in Executive’s duties to the Company and then only with the Company’s prior written consent, Executive shall not, directly or indirectly, use for Executive’s own benefit or the benefit of others, lecture upon, publish articles concerning, disseminate, disclose, reveal or transfer to any person or entity, any Confidential Information or any part thereof, or assist or solicit any person or entity other than the Company to secure any benefit from the Confidential Information or any part thereof, either during or at any time after the term of this Agreement.

        (c)     All documents, papers, notes, notebooks, memoranda, computer files and other written or electronic records of any kind made by Executive during and in connection with Executive’s employment by the Company, shall remain the property of the Company at all times.

    10.     Assignment of Inventions .

        (a)     Executive agrees that any inventions, ideas, original works of authorship or other work product in whole or in part conceived or made by Executive which are made through the use of any of the Confidential Information or any of the Company’s equipment, facilities, supplies, trade secrets or time, or which relate to the Company’s business or the Company’s actual or demonstrably anticipated research and development, or which result from any work performed by Executive for the Company, along with any rights in or to any of the foregoing under copyright, patent, trade secret, trademark or other law, shall belong exclusively to the Company and shall be deemed part of the Confidential Information for purposes of this Agreement whether or not fixed in a tangible medium of expression. Without limiting the foregoing, Executive agrees that any such original works of authorship shall be deemed to be “works made for hire” and that the Company shall be deemed the author thereof under the U.S. Copyright Act (Title 17 of the U.S. Code), provided that in the event and to the extent such works are determined not to constitute “works made for hire” as a matter of law or that there are any rights that do not accrue to the Company as a work made for hire, Executive hereby irrevocably assigns and transfers to the Company all right, title and interest in and to such works, including but not limited to copyrights and other intellectual property rights. This Agreement shall be construed in accordance with the provisions of Section 2870 of the California Labor Code (a copy of which is attached as Exhibit “A” hereto) relating to inventions made by Executive, and accordingly this Agreement is not intended and shall not be interpreted to assign to or vest in the Company any of Executive’s rights in any inventions other than those described in the first sentence of this Section 10(a).

6

        (b)     At all times during Executive’s employment by the Company, Executive will maintain a complete and detailed current written record of all ideas, concepts, improvements, discoveries or inventions, of any nature (“Inventions”), whether patentable or not, created or made in whole or in part by Executive, either solely or jointly with others, and Executive will promptly disclose any such Inventions to the Company, in writing. Executive further agrees that all such written records shall be and remain the sole and exclusive property of the Company, and Executive shall make such written records available to the Company at any time upon request, for review, inspection or copying by the Company, and shall deliver all copies of such records to the Company upon termination of Executive’s employment, for any reason.

&n