MEMBERSHIP UNIT PURCHASE AGREEMENT

Exhibit 10.1

MEMBERSHIP UNIT PURCHASE AGREEMENT

THIS MEMBERSHIP UNIT PURCHASE AGREEMENT (the “ Agreement ”) is entered into as of December 12, 2007, by and among Auriga Laboratories, Inc., a Delaware corporation (“Shareholder”), Stesso Pharmaceuticals, LLC, a Delaware limited liability company (the “ Company ”) and Malibu Pharma, Inc., a Delaware corporation (collectively referred to hereinafter as “ Purchaser ”).

RECITALS

WHEREAS , WHEREAS, Shareholder is the beneficial and record owner of all of the issued and outstanding membership interests of the Company (the “Units”);

WHEREAS , Purchaser desires to purchase the Units from the Shareholder, and the Shareholder desire to sell the Units to Purchaser, subject to the terms and conditions hereinafter set forth (such purchase and sale of the Units shall be referred to herein as the “Acquisition”); and

WHEREAS , the payments and agreements set forth herein constitute good and valuable consideration to the Shareholder and the Shareholder acknowledges that Purchaser is relying upon the promises and indemnities made by the Shareholder herein as a material inducement to enter into this Agreement..

AGREEMENT

NOW, THEREFORE , in consideration of the foregoing recitals and the mutual promises hereinafter set forth, the parties hereto agree as follows:

1.1            Sale and Purchase . Subject to the terms and conditions hereof, the Purchaser agrees to pay to the Shareholder the following consideration (collectively, the “Purchase Price”) for all of the Units:

(a).           Subject to the terms and conditions hereof, at the Closing the Shareholder hereby agrees to convey, sell, transfer and deliver to Purchaser, and Purchaser hereby agrees to purchase from the Shareholder, all of the Units for a total of Six Million Dollars ($6,000,000). Purchaser shall pay the Purchase Price by executing and delivering a promissory note to the Company in the amount of Six Million Dollars ($6,000,000) in substantially the form attached as Exhibit A (the “Note”);

(b).           Subject to the terms and conditions hereof, beginning with first calendar quarter after the payment of all principal and interest under the Note has been made, Purchaser shall pay Shareholder 5.0% of the Net Revenue Collected (as defined below) from the sale of products by the Company. ; and

(c).           Subject to the terms and conditions hereof, the Purchaser grants to the Shareholder the option to purchase the Units for One Hundred Fifty Percent (150%) of the Purchase Price for period of time equal to Two Hundred Seventy (270) days from the date hereof (the “Re-Purchase Option”). Unless otherwise agreed in writing, the Re-Purchase Option shall be exercised by

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delivering a written notice to the Purchaser prior to the expiration of the Re-Purchase Option, enclosing the full amount of the exercise price.

For the purpose of this Agreement, “Net Revenue Collected” shall mean the amount of cash actually received by Company, pursuant to sales of Company’s products after the date hereof less (i) any royalties payable pursuant to existing license agreements and other arrangements; (ii) any sales commissions payable; and (iii) reasonable reserves set aside by Company to cover returns of its products sold after the date hereof.

The closing of the sale and purchase of the Units under this Agreement (the “ Closing ”) shall take place at 10:00 p.m. on the date set forth above at the offices of the Company, in Los Angeles, California, or at such other time or place as the Shareholder and Purchaser may mutually agree (the “ Closing Date ”).

At the Closing, subject to the terms and conditions hereof, the Shareholder will deliver to Purchaser, against delivery of the Note a stock certificate(s) representing all of the Units, duly endorsed in favor of Purchaser or accompanied by stock power(s) duly executed in favor of, and in a form reasonably acceptable to, Purchaser

The Company and the Shareholder hereby jointly and severally hereby represent and warrant to Purchaser that the representations and warranties set forth below are true and correct on the date of this Agreement, and shall be true on the time of Closing, except as disclosed in a document delivered by the Company and the Shareholder to Purchaser prior to the Closing, which shall be organized in a manner so as to specifically refer to the sections intended to be so qualified (the “Schedule of Exceptions”).

The authorized capital of the Company, immediately prior to the Closing, consists of 5,000,000 membership units, 5,000,000 units of which are issued and outstanding. All issued and outstanding Units of the Company’s capital: (a) have been duly authorized and validly issued; and

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(b) are fully paid and nonassessable, (c) are free of any liens; provided , however , that the Units shall be subject to such restrictions on transfer under state and federal securities laws as may be required by such laws at the time a transfer is proposed. There are not outstanding any options, warrants, rights (including conversion or preemptive rights) or agreements for the purchase or acquisition from the Company of any shares of its capital stock. The Company is not a party or subject to any agreement or understanding and there is no agreement or understanding between any persons and/or entities, which affects or relates to the voting or giving of written consents with respect to any security or by a director of the Company.

All corporate action on the part of the Shareholder and the Company, their respective officers, directors and securityholders necessary for the authorization of this Agreement, the performance of all obligations of the Shareholders and the Company hereunder at the Closing and the sale and delivery of the Units pursuant hereto has been taken or will be taken prior to the Closing. This Agreement, when executed and delivered, will contain valid and binding obligations of the Shareholder and the Company enforceable in accordance with their terms, except: (a) as limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws of general application affecting enforcement of creditors’ rights; and (b) general principles of equity that restrict the availability of equitable remedies. The sale of the Units is not and will not be subject to any preemptive rights or rights of first refusal that have not been properly waived or complied with.

The Company has no material liabilities and, to the best of its knowledge, knows of no material contingent liabilities except those disclosed in the attached Schedule of Exceptions Section 3.4 .

There are no agreements, understandings, instruments, contracts, proposed transactions, judgments, orders, writs or decrees to which the Company is a party or to its knowledge by which it is bound which may involve: (i) obligations (contingent or otherwise) of, or payments to, the Company in excess of $25,000 (other than obligations of, or payments to, the Company arising from purchase or sale agreements entered into in the ordinary course of business); or (ii) indemnification by the Company with respect to infringements of proprietary rights (other than indemnification obligations arising from purchase or sale or license agreements entered into in the ordinary course of business).

There are no obligations of the Company to officers, directors, stockholders or employees or service providers of the Company. The Company is not a guarantor or indemnitor of any indebtedness of any other person, firm or corporation.

Except as disclosed in the attached Schedule of Exceptions Section 3.7 , since September 30, 2007, there has not been to the Company’s knowledge:

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(a)             Any change in the assets, liabilities, financial condition or operations of the Company from that reflected in the Financial Statements, other than changes in the ordinary course of business, none of which individually or in the aggregate has had or is expected to have a material adverse effect on such assets, liabilities, financial condition, operations or prospects of the Company;

(b)            Any material change, except in the ordinary course of business, in the contingent obligations of the Company by way of guaranty, endorsement, indemnity, warranty or otherwise;

(c)             Any damage, destruction or loss, whether or not covered by insurance, materially and adversely affecting the properties, business or prospects or financial condition of the Company;

(d)            Any waiver by the Company of a valuable right or of a material debt owed to it;

(e)             Any direct or indirect loans made by the Company to any stockholder, employee, officer or director of the Company;

(f)             Any material change in any compensation arrangement or agreement with any employee, officer, director or stockholder;

(g)            Any declaration or payment of any dividend or other distribution of the assets of the Company;

(h)            Any debt, obligation or liability incurred, assumed or guaranteed by the Company, except those for immaterial amounts and for current liabilities incurred in the ordinary course of business;

(i)             Any sale, assignment or transfer of any patents, trademarks, copyrights, trade secrets or other intangible assets;

(j)             Any change in any material agreement to which the Company is a party or by which it is bound which materially and adversely affects the business, assets, liabilities, financial condition, operations or prospects of the Company;

(k)            Any other event or condition of any character that, either individually or cumulatively, has materially and adversely affected the business, assets, liabilities, financial condition, operations or prospects of the Company; or

(l)             Any arrangement or commitment by the Company to do any of the acts described in subsection (a) through (l) above.

Attached as Exhibit B is a full and complete list of the assets owned by the Company as of the date listed thereon (the “Assets”). The Company has good and marketable title to its properties and assets, and good title to its leasehold estates, in each case subject to no mortgage, pledge, lien, lease, encumbrance or charge, other than: (a) those resulting from taxes which have not

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yet become delinquent; and (b) minor liens and encumbrances which do not materially detract from the value of the property subject thereto or materially impair the operations of the Company.

There are no debts, liabilities (including refunds payable), obligations or claims against the Company of any nature, whether accrued, absolute, contingent or otherwise (whether or not determined or determinable) and whether due or to become due that are not disclosed or provided for in the Company Financial Statements or the notes thereto provided to Purchaser

To the best of its knowledge, the Company owns or possesses adequate legal rights (by license or otherwise) to all patents, trademarks, service marks, trade names, copyrights, trade secrets, licenses, information and other proprietary rights and processes necessary for its business as now conducted and as presently proposed to be conducted, without any known infringement of the rights of others. Except as disclosed in the Schedule of Exceptions Section 3.9 , there are no outstanding options, licenses or agreements of any kind relating to the foregoing, nor is the Company bound by or a party to any options, licenses or agreements of any kind with respect to the patents, trademarks, service marks, trade names, copyrights, trade secrets, licenses, information and other proprietary rights and processes of any other person or entity other than such licenses or agreements arising from the purchase of “off the shelf” or other standard products. The Company has not received any communications alleging that the Company has violated or, by conducting its business as presently proposed, would violate any of the patents, trademarks, service marks, trade names, copyrights or trade secrets or other proprietary rights of any other person or entity. The Company is not aware that any of its employees is obligated under any contract (including licenses, covenants or commitments of any nature) or other agreement, or subject to any judgment, decree or order of any court or administrative agency, that would interfere with their duties to the Company or that would conflict with the Company’s business as presently proposed to be conducted. Neither the execution nor delivery of this Agreement, nor the carrying on of the Company’s business by the employees of the Company, nor the conduct of the Company’s business as presently proposed, will, to the Company’s knowledge, conflict with or result in a breach of the terms, conditions or provisions of, or constitute a default under, any contract, covenant or instrument under which any employee is now obligated.

There is no action, suit, proceeding or investigation pending or, to the Company’s knowledge, currently threatened against the Company that questions the validity of this Agreement or the right of the Company to enter into this Agreement, or to consummate the transactions contemplated hereby, or which might result, either individually or in the aggregate, in any material adverse change in the assets, condition, affairs or prospects of the Company, financially or otherwise, or any change in the current equity ownership of the Company, nor is the Company aware that there is any basis for any of the foregoing. The Company is not a party or subject to the provisions of any order, writ, injunction, judgment or decree of any court or government agency or instrumentality. There is no action, suit, proceeding or investigation by the Company currently pending or which the Company intends to initiate.

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The Company has no employees, consultants or other service providers.

To its knowledge, the Company is not in violation of any applicable statute, rule, regulation, order or restriction of any domestic or foreign government or any instrumentality or agency thereof in respect of the conduct of its business or the ownership of its properties which violation would materially and adversely affect the business, assets, liabilities, financial condition, operations or prospects of the Company. No governmental orders, permissions, consents, approvals or authorizations are required to be obtained and no registrations or declarations are required to be filed in connection with the execution and delivery of this Agreement and the issuance of the Units or the Conversion Units, except such as has been duly and validly obtained or filed, or with respect to any filings that must be made after the Closing, as will be filed in a timely manner. Except as may be set forth in the Schedule of Exceptions Section 3.13 , the Company has all franchises, permits, licenses and any similar authority necessary for the conduct of its business as now being conducted by it, the lack of which could materially and adversely affect the business, properties, prospects or financial condition of the Company and believes it can obtain, without undue burden or expense, any similar authority for the conduct of its business as planned to be conducted.

Assuming the accuracy of the representations and warranties of Purchaser contained in Section 4.2 hereof, the sale of the Units will be exempt from the registration requirements of the Securities Act of 1933, as amended (the “ Securities Act ”), and will have been registered or qualified (or are exempt from registration and qualification) under the registration, permit or qualification requirements of all applicable state securities laws.

The Company has provided Purchaser with all information requested by Purchaser in connection with the decision to purchase the Units, including all information the Company believes is reasonably necessary to make such investment decision. Neither this Agreement, nor any other statements or certificates made or delivered in connection herewith or therewith contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements herein or therein not misleading

Shareholder hereby represents and warrants to Purchaser as follows:

Shareholder owns the Units, beneficially and of record, free and clear of any liens, claims, encumbrances, restrictions on transfers or proprietary interests of any third party. There is not outstanding any subscription, option, warrant, call, right or other agreement or commitment obligating the Shareholder or the Company to issue, sell, deliver or transfer (including any right of conversion or exchange under any outstanding security or other instrument) any of the Units. The Shareholder has the absolute and unconditional right and authority to sell the Units owned by it to Purchaser.

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Purchaser hereby represents and warrants to the Company as follows (such representations and warranties do not lessen or obviate the representations and warranties of the Company set forth in this Agreement):

Purchaser has all necessary power and authority under all applicable provisions of law to execute and deliver this Agreement and to carry out their provisions. All action on Purchaser’s part required for the lawful execution and delivery of this Agreement have been or will be effectively taken prior to the Closing. Upon its execution and delivery, this Agreement will contain valid and binding obligations of Purchaser, enforceable in accordance with their terms, except: (a) as limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws of general application affecting enforcement of creditors’ rights; and (b) general principles of equity that restrict the availability of equitable remedies.

Purchaser understands that the Units have not been registered under the Securities Act. Purchaser also understands that the Units are being offered and sold pursuant to an exemption from registration contained in the Securities Act based in part upon Purchaser’s representations contained in this Agreement. Purchaser hereby represents and warrants as follows:

(a)             Purchaser Bears Economic Risk . Purchaser has substantial experience in evaluating and investing in private placement transactions of securities in companies similar to the Company so that it is capable of evaluating the merits and risks of its investment in the Company and has the capacity to protect its own interests. Purchaser must bear the economic risk of this investment indefinitely until such time as the Units are registered pursuant to the Securities Act, or an exemption from registration is available.

(b)            Acquisition for Own Account . Purchaser is acquiring the Units for Purchaser’s own account for investment only, and not with a view towards their distribution.

(c)             Purchaser Can Protect Its Interest . Purchaser represents that by reason of its, or of its management’s, business or financial experience, Purchaser has the capacity to protect its own interests in connection with the transactions contemplated in this Agreement. Further, Purchaser is aware of no publication of any advertisement in connection with the transactions contemplated in this Agreement.

(d)            Accredited Investor . Purchaser represents that it is an “accredit