STOCKHOLDERS' AGREEMENT

EXHIBIT 10(e)

EXECUTION VERSION

STOCKHOLDERS' AGREEMENT (this "AGREEMENT"), dated as of
December 6, 2006 (the "EFFECTIVE DATE"), among Novel
Laboratories, Inc., a Delaware corporation (the
"COMPANY"), and Elite Pharmaceuticals, Inc. ("ELITE")
and VGS Pharma LLC, a Delaware limited liability company
("VGS") and Veerappan Subramanian ("SUBRAMANIAN" and
together with Elite and VGS, each a "STOCKHOLDER" and
collectively, the "STOCKHOLDERS").
--------------------------------------------------------

INTRODUCTION

In connection with that certain Strategic Alliance Agreement, dated
as of the date hereof (the "STRATEGIC ALLIANCE AGREEMENT"), among Elite, VGS and
Subramanian and the transactions contemplated thereby, the parties hereto are
entering into this Agreement;

In connection with Subramanian's potential acquisition of shares of
the Company's capital stock pursuant to any Stock Option Plan (as defined
below), he is being made a party to this Agreement;

The Strategic Alliance Agreement states that as a condition to its
effectiveness, the Company and the Stockholders shall enter into this Agreement;
and

The Stockholders and the Company desire to promote their mutual
interests by agreeing to certain matters relating to, among other things, the
governance of the Company and the disposition of shares of capital stock of the
Company, held, or hereafter acquired, by the Stockholders.

IN CONSIDERATION of the foregoing and the covenants and obligations
set forth below, the parties hereto, intending to be legally bound, hereby agree
as follows:

ARTICLE I

INTERPRETATION OF THIS AGREEMENT

1.1. CERTAIN DEFINITIONS. As used herein, the following terms shall
have the following meanings:

"AFFILIATE" means, with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under common control with,
such Person. A Person shall be deemed to "CONTROL" another Person if such Person
possesses, directly or indirectly, the power to direct or cause the direction of
the management or policies of such other Person, whether through the ownership
of voting securities, by contract or otherwise. For the avoidance of doubt, the
Company is not considered an Affiliate of Elite at the time this Agreement is
executed.

"BANKRUPTCY EVENT" means, with respect to any affected holder of
Shares (a) the initiation of a voluntary case or other proceeding seeking
liquidation, reorganization or other relief under any bankruptcy, insolvency or
other similar law; (b) the commencement of an involuntary case or other
proceeding against such holder seeking liquidation, reorganization or

<PAGE>

other relief under the bankruptcy, insolvency or other similar laws, and is not
dismissed within ninety (90) days; or (c) the entry of an order for relief
against such holder under the federal bankruptcy laws as now or hereafter in
effect.

"BOARD" means the Board of Directors of the Company.

"BUSINESS PLAN" means either of the Initial Business Plan and each
Annual Business Plan, as each such term is defined in the Strategic Alliance
Agreement.

"BY-LAWS" means the By-Laws of the Company, as amended from time to
time.

"CERTIFICATE OF INCORPORATION" means the Certificate of
Incorporation of the Company, as amended from time to time.

"CHANGE OF CONTROL" means, with respect to any Stockholder that
holds at least ten percent (10%) of the outstanding shares of capital stock of
the Company (other than a Permitted Transfer pursuant to Section 3.1(ii)), a
change in the ownership of fifty percent (50%) or more of the equity or
partnership interests (or economic benefit thereof) in a Person, or the
acquisition, directly or indirectly, of the fifty percent (50%) or more of the
equity or partnership interests (or economic benefit thereof) in a person.

"CLASS A COMMON STOCK" means the Class A Common Stock, par value
$0.0001 per share, of the Company.

"CLASS B COMMON STOCK" means the Class B Common Stock, par value
$0.0001 per share, of the Company.

"DIRECTOR" means a member of the Board.

"DIVESTITURE EVENT" means the occurrence of any of the following
events with respect to a holder of Shares: (i) liquidation, dissolution or
winding up; (ii) the occurrence of a Bankruptcy Event; or (iii) a Change of
Control.

"ELITE CONTRIBUTIONS" shall have the meaning ascribed to such term
in the Strategic Alliance Agreement.

"FAMILY MEMBER" means any parent, spouse, child, brother, sister or
any other relative with a relationship (by blood, marriage or adoption) not more
remote than first cousin.

"GOOD REASON" shall have the meaning assigned to such term in the
Subramanian Employment Agreement.

"NEW SECURITIES" except as set forth below, shall mean any shares of
capital stock of the Company issued after the date hereof, including Class A
Common Stock, Class B Common Stock, whether now authorized or not, and rights,
options, or warrants to purchase such common stock, and securities of any type
whatsoever that are, directly or indirectly, convertible into said common stock.
Notwithstanding the foregoing, the term New Securities does not include (i)
registered securities offered to the public pursuant to a registration statement
filed and


2
<PAGE>

declared effective by the SEC pursuant to the Act, (ii) Class B Common Stock or
warrants or options exercisable for Class B Common Stock, or other capital stock
or warrants or options exercisable for other capital stock, issued or granted to
employees, consultants, officers and directors of the Company, pursuant to the
Stock Option Plan, as amended from time to time, and any successor plan thereto,
(iii) stock issued in connection with any stock split, stock dividend,
distribution, reclassification or recapitalization by the Company, (iv) stock
issued in respect of any warrant, option or upon conversion or exchange of
convertible or exchangeable securities outstanding as of the date of this
Agreement, and (v) securities of the Company issued after the date hereof in
connection with the Company's entering into an acquisition or strategic
partnership, or issued to lenders, lessors or vendors of the Company, in each
case approved by the Board.

"ORIGINAL ELITE SHARES" means the shares of Class A Common Stock
held by Elite as of the Effective Date of this Agreement, and all capital stock
or other securities of the Company representing a dividend on any such shares of
Class A Common Stock, or representing a distribution or return of capital upon
or in respect of such shares of Class A Common Stock, or resulting from a stock
split, revision, reclassification or other exchange therefor, and any
subscriptions, warrants, rights or options issued to Elite or its permitted
transferee, or otherwise in respect of, such shares of Class A Common Stock,
without regard to Transfers made subsequent to the Effective Date hereof.

"ORIGINAL VGS SHARES" means the shares of Class A Common Stock held
by VGS as of the Effective Date of this Agreement, and all capital stock or
other securities of the Company representing a dividend on any such shares of
Class A Common Stock, or representing a distribution or return of capital upon
or in respect of such shares of Class A Common Stock, or resulting from a stock
split, revision, reclassification or other exchange therefor, and any
subscriptions, warrants, rights or options issued to VGS or its permitted
transferee, or otherwise in respect of, such shares of Class A Common Stock,
without regard to Transfers made subsequent to the Effective Date hereof.

"PERFORMANCE MILESTONE" shall have the meaning ascribed to such term
in the Strategic Alliance Agreement.

"PERMITTED TRANSFER" shall have the meaning ascribed to such term in
Section 3.3 hereof.

"PERSON" means any individual, partnership, joint venture, firm,
corporation, limited liability company, association, trust, unincorporated
organization or other enterprise or any government or political subdivision or
any agency, department or instrumentality thereof.

"PUBLICLY TRADED" means (i) the initial public offering of any class
of equity securities of the Company pursuant to an effective registration
statement under the Securities Act of 1933 (excluding registration statements on
Form S-4 and Form S-8 and similar limited purpose forms); (ii) any class of
equity securities of the Company become eligible to be traded in any public
securities market; or (iii) the Company becomes subject to the reporting
requirements of the Securities and Exchange Act of 1934, as amended.


3
<PAGE>

"REMAINING CONTRIBUTIONS" shall have the meaning ascribed to such
term in the Strategic Alliance Agreement.

"SHARES" means all capital stock and equity securities of the
Company.

"STRATEGIC ALLIANCE DOCUMENTS" shall have the meaning ascribed to
such term in the Strategic Alliance Agreement.

"STOCK OPTION PLAN" means the Company's 2006 Stock Option Plan.

"SUBRAMANIAN EMPLOYMENT AGREEMENT" means that certain Employment
Agreement, dated as of the date hereof, between the Company and Subramanian.

"TRANSFER" means, as to any Share, to directly or indirectly sell,
assign, transfer, offer, grant a participation in, mortgage, pledge,
hypothecate, create a security interest in or lien upon, encumber, donate,
contribute, place in trust, enter into any voting agreement in respect of, or
otherwise dispose of, such Share.

1.2. DIRECTLY OR INDIRECTLY. Where any provision in this Agreement
refers to action to be taken by any Person, or which such Person is prohibited
from taking, such provision shall be applicable whether such action is taken
directly or indirectly by such Person.

ARTICLE II

CORPORATE GOVERNANCE

2.1. BOARD OF DIRECTORS AND BY-LAWS.

(a) At each election of Directors during the term of this Agreement,
the Stockholders shall vote their Shares, and otherwise use commercially
reasonable efforts as stockholders of the Company,

(i) to cause and maintain the election to the Board comprised
of:

(x) for so long as Elite and its Affiliates,
collectively, are holders of at least ten percent (10%) of the issued and
outstanding capital stock of the Company, one (1) designee of Elite (the
"ELITE DESIGNEE"); and

(y) for so long as VGS and its Affiliates, collectively,
are holders of at least ten percent (10%) of the issued and outstanding
capital stock of the Company, one (1) designee of VGS (the "VGS
DESIGNEE");

(ii) to remove, reappoint and replace any such designee in
accordance with the direction of the relevant Stockholder.

For so long as Elite is the holder of at least ten percent (10%) of the issued
and outstanding capital stock of the Company, VGS shall only designate
Subramanian pursuant to the terms of this Section 2.1(a) and may only designate
another person as the VGS Designee (A) upon


4
<PAGE>

Subramanian's death or disability, (B) upon Subramanian's retirement after his
sixty-fifth (65th) birthday, or (C) with the prior written consent of Elite.

(b) The number of Directors shall be (2) voting members.

(c) At each election of Directors during the term of this Agreement,
the Stockholders shall vote their respective Shares and otherwise use
commercially reasonable efforts as stockholders of the Company, to prevent any
amendment of the Certificate of Incorporation or By-Laws of the Company
inconsistent with this Agreement.

2.2. PROTECTIVE PROVISIONS. The affirmative consent of each of the
Elite Designee (so long as Elite is a holder of at least ten percent (10%) of
the issued and outstanding capital stock of the Company) and the VGS Designee
(so long as Elite is a holder of at least ten percent (10%) of the issued and
outstanding capital stock of the Company) shall be required for the following
actions to the taken by the Board or any officer of the Company with respect to
the Company or its subsidiaries:

(i) any amendment to the Certificate of Incorporation, By-Laws or other
governance documents;

(ii) spin-off or public offering of equity securities;

(iii) liquidation, dissolution, winding-up, recapitalization,
reorganization, merger, consolidation or sale;

(iv) any sale, exclusive lease or out-license, exchange, transfer or other
disposition, of any Material (as defined below) asset or Material drug product,
other than sales of products in the ordinary course of business;

(v) authorization, creation, designation or issuance of any additional
equity or debt securities, including under the Stock Option Plan;

(vi) declaration or payment of dividends or distributions;

(vii) except as expressly provided in the Strategic Alliance Documents,
any repurchase or redemption of securities;

(viii) commencement of any voluntary bankruptcy proceeding, liquidation,
reorganization, dissolution, conservation, delinquency or receivership
proceeding, or a proceeding similar to any of the foregoing or permitting any
involuntary bankruptcy, liquidation, reorganization, dissolution, conservation,
delinquency or receivership proceeding to remain unstayed for more than thirty
(30) days from the date of the petition therefore or commencement thereof;

(ix) a Material change in the nature or focus of the business or any
Business Plan;

(x) approval of each Business Plan, and the yearly operating budget;

(xi) incurrence of indebtedness in excess of amounts approved in the
Business Plan, or the grant or creation of any security interest in or other
encumbrance on any Material asset;


5
<PAGE>

(xii) capital expenditures and investments (including creation of a
subsidiary) in excess of, in the case of capital expenditures, one hundred ten
percent (110%) of the amounts approved in the Business Plan and, in the case of
investments, the amounts approved in the Business Plan;

(xiii) approval of any transaction with any executive officer, director or
equity holder or any affiliate of an executive officer, director or equity
holder (including Family Members), including the award of bonuses to
Subramanian;

(xiv) entering into any agreement restricting the ability of the Company
to compete, in any Material respect, in any area of business;

(xv) commencement or settlement of any Material litigation or proceeding,
or threatened litigation or proceeding;

(xvi) removal, replacement or appointment of the Company's independent
accountants (other than Weiser LLP, which the parties hereto agree shall be the
Company's initial independent accounts);

(xvii) increasing or decreasing the size of the Board;

(xviii) the purchase or license of Material products from third parties;

(xix) entry into Material joint ventures, licensing, marketing,
distribution and similar Material arrangements;

(xx) any public offering of securities of the Company, or any registration
for sale to the public of securities of the Company; and

(xxi) any investment (whether equity or debt) by Subramanian, or any
Affiliate of Subramanian, in any Competitive Company (as defined in the
Strategic Alliance Agreement).

For purposes of this Section 2.2, shall "MATERIAL" mean material to the
business, assets, operations, properties, financial position, results of
operations, liabilities or prospects of the Company as a whole.

2.3. CONFIDENTIALITY REQUIREMENTS. Each Stockholder agrees that all
financial or other information about the Company, or other information of the
Company of a confidential or proprietary nature, disclosed to them at any time,
in connection with this Agreement or otherwise, shall be kept confidential by
them and shall not be directly or indirectly disclosed to any Person (other
than, as necessary, to such Stockholder's agents, employees or lenders) or used
by such Stockholder except: (i) with the prior written consent of the Company;
(ii) as may be required by applicable law, court process or other obligations
pursuant to any listing agreement with any national securities exchange
(including the Nasdaq Stock Market); or (iii) such information which is or
becomes generally available other than as a result of a violation of this
provision.

2.4 TERMINATION FOR CAUSE UNDER THE SUBRAMANIAN EMPLOYMENT
AGREEMENT; BINDING ARBITRATION.

(a) Notwithstanding anything in this Agreement to the contrary, the
determination of the existence of "Cause" or "Disability" as a basis for the
termination of Subramanian under Subramanian Employment Agreement shall be made
solely in the reasonable


6
<PAGE>

discretion of the Elite Designee, not the Board, in good faith, and upon receipt
of written notice from the Elite Designee setting forth the basis of "Cause" or
"Disability" for such termination, the Company shall take all requisite steps to
terminate Subramanian for "Cause" or "Disability" in accordance with the terms
of the Subramanian Employment Agreement.

(b) Any action, claim, dispute or controversy arising out of or in
connection with the determination of the existence of "Cause" or "Disability"
(each, a "DISPUTE") shall be determined by binding arbitration in New York, New
York, before a single JAMS arbitrator who is an expert in the subject matter in
dispute and reasonably acceptable to each party, and administered by JAMS
pursuant to its Comprehensive Arbitration Rules and Procedures ("ARBITRATION").
Either party may initiate Arbitration with respect to a Dispute by filing a
written demand for Arbitration with JAMS. The parties acknowledge and agree that
judgment on the award in any Arbitration shall be binding upon the parties
hereto and may be entered and enforced in any court having jurisdiction. Each
party acknowledges and agrees that all Disputes shall be decided in accordance
with this Section 2.4(b) and hereby waives any rights to have those matters
litigated in a court and/or by jury trial. Each party acknowledges and agrees
that the provisions of this Section 2.4(b) are binding upon such party and may
be enforced by any court of competent jurisdiction. Each party further
irrevocably consents to service of process in any Dispute in the manner provided
for notices in Section 9.9. Nothing in this Agreement will affect the right of
any party to serve process in any other manner permitted by law or by
Arbitration rules.

ARTICLE III

TRANSFERS OF SHARES

3.1. GENERAL PROHIBITION ON TRANSFER. No Stockholder may Transfer
any of its Shares without the prior written consent of the other Stockholder(s),
except in the case of: (i) a Permitted Transfer (as defined in Section 3.3);
(ii) a Transfer by VGS to its members or a Family Member of any of its members
or to a trust wholly controlled by, or for the sole benefit of, its members or a
Family Member of any of its members, provided that all Shares transferred remain
subject to the terms of this Agreement, including, without limitation, Article
III, Section 4.1, Article V, Article VIII and Article IX; or (iii) a Transfer by
Elite, due to a restructuring of, or a sale of substantially all of the assets
of, Elite.

3.2. RESTRICTIONS ON TRANSFERS TO COMPETITORS. Notwithstanding
anything in this Agreement to the contrary, no Stockholder may Transfer any
Shares to any Person who or which is (i) a competitor of the Company or any of
its subsidiaries; (ii) a competitor of Elite or any of its subsidiaries; or
(iii) a shareholder or other security holder of any Person referred to in
sub-clause (i) or sub-clause (ii).

3.3. PERMITTED TRANSFERS. A "PERMITTED TRANSFER" shall be a Transfer
that complies with each of the following conditions:

(a) the non-transferring Stockholder(s) shall have provided prior
written consent to the Transfer to such proposed transferee; PROVIDED that such
consent may not be unreasonably withheld, conditioned or delayed (it being
acknowledged and agreed among the parties hereto


7
<PAGE>

that withholding consent to a proposed transferee that is a financial investor
with no business operations in the pharmaceutical industry is presumed to be
unreasonable);

(b) such Transfer, when combined with any prior Transfers by such
transferring Stockholder, does not cause all such Transfers by such Stockholder
to exceed thirty-three and one third percent (33 1/3%) of the Shares