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Cooperative diversity systems rely on using relay nodes to relay copies of transmitted information to the destination such that each copy experiences different channel fading, hence increasing the diversity of the system. However, without proper processing of the message at the relays, the performance of the cooperative system may not necessarily perform better than direct transmission systems. In this paper, we proposed a distributed beamforming and power allocation algorithm which substantially improves the diversity of the system with only very limited feedback from the destination node. We also derive outage probability as well as study the outage behavior of this scheme.