THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
PARTNERSHIP AGREEMENT
 
This Partnership Agreement ("Agreement") is entered into as of the 7th day of
November, 2006 ("Effective Date") by and between RxElite, Inc. ("RxElite"), a
Delaware corporation, whose principal place of business is 1404 North Main,
Suite 200, Meridian, ID 83642 and Core Tech Solutions, Inc. ("Core Tech"), a New
Jersey corporation, whose principal place of business is 50 Lake Dr., East
Windsor, NJ 08520.
 
WHEREAS, RxElite is a rapidly growing U.S. generic pharmaceutical company
utilizing "best in class" manufacturing and research and development; and,
 
WHEREAS, Core Tech Solutions, Inc. is a corporation that owns and is developing
and manufacturing products and technology in the areas of transdermal (TDS) and
topical delivery systems; and,
 
WHEREAS, RxElite and Core Tech, hereinafter referred to as the Parties, wish to
establish a business partnership agreement in accordance with the terms set
forth herein.
 
Article I - Definitions
 
1.1. "Licensed Products" shall mean the Fentanyl transdermal systems produced by
Core Tech, equivalent, according to the U.S. FDA, to the brand product
Duragesic®, manufactured by a division of Johnson and Johnson.
 
1.2. "Technology" shall mean the copyright, trade secret, know-how, data, drug
applications, and other information (whether or not patentable or qualifying as
a trade secret) relating to the "Field of Use" and the "License Products" that
Core Tech owns, or hereafter develops, individually or in conjunction with
RxElite, and that may hereafter be provided to or revealed to RxElite by Core
Tech, pursuant to the terms of this Agreement.
initials [initials.jpg]
 
Page 1 of 27

--------------------------------------------------------------------------------

THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
1.3. "Field of Use" shall mean the "Licensed Product" for sale, distribution and
use of the Fentanyl Transdermal System, equivalent, according to the U.S. FDA,
to the brand product Duragesic®, manufactured by a division of Johnson and
Johnson.
 
1.4. "License Period" shall mean collectively the respective periods commencing
on the date hereof and ending (unless terminated) with no end date.
 
1.5. "Gross Sales" shall mean the gross sales of Licensed Products billed to
customers by RxElite, its Subsidiaries, and its sub-Licensees, less the
following:
 
(a) allowances and adjustments actually credited to customers for damaged and
returned Licensed Products;
 
(b) trade, quantity, cash, and prompt payment discounts actually allowed and
taken; and
 
(c) third-party charges of the following kinds, collected by the seller from the
buyer and separately identified on the invoice: transportation charges, sales
taxes, and excise taxes and duties.
 
Gross Sales shall also include and be deemed to have been made with respect to
any Licensed Products used by RxElite, any Subsidiary, or any sub-Licensee, for
its own purposes, or transferred to any third-party for less than the transferee
is then charging in normal arms-length sales transactions; and Gross Sales in
all such cases shall be deemed to have been made at the prices therefore at
which such Licensed Products are then being sold to the customers of such users
or transferors (or of RxElite, if a subsidiary is a user but not a seller) in
arms-length transactions.
 
1.6. "Net Profits" shall mean the Gross Sales of Licensed Products as defined in
Section 1.5, less the following:
 
(a) Core Tech product transfer price;
 
(b) direct customer rebates, including Medicaid and Medicare rebates; and,
initials [initials.jpg]
 
Page 2 of 27

--------------------------------------------------------------------------------

 
THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
(c) liability insurance for the licensed product, direct warehousing and
transportation costs not attributed to the "Gross Sales" calculation.
 
1.7 "Subsidiary" shall mean any corporation, partnership, or other business
organization that directly or indirectly controls, is controlled by, or is under
common control with RxElite.
 
1.8 "Territory" shall mean the United States and World Wide rights if payment in
full for World-Wide rights is paid according to the terms below.
 
Article II — Core Tech Responsibilities
 
2.1. Research and Development Activities: Core Tech shall provide the following
services in relation to the approval of a Fentanyl Transdermal System,
equivalent, according to the U.S. FDA, to the brand product Duragesic®,
manufactured by a division of Johnson and Johnson.:

 

·  
Analytical Method Transfer & Validation; and,

 

·   Product Scale up.

 
2.2. Clinical and U.S. Regulatory Activities: Core Tech shall provide the
following services in relation to the approval of a Fentanyl Transdermal System,
equivalent, according to the U.S. FDA, to the brand product Duragesic®,
manufactured by a division of Johnson and Johnson.:
 
· cGMP Manufacturing of Clinical and Registration Batches (1 x 25k batch each)
placebo, 12.5, 25, 50, 75, 100 μg/hr, QC Release of Clinical and Registration
batches;
 
· Pivotal Bioequivalence Study (XX subjects to complete) - Duragesic® (25μg/hr,
10 cm2, 0.6 mg/24hr) vs. Core Tech Generic Fentanyl Transdermal System (25μg/hr,
10 cm2, 0.6 mg/24hr);
 
initials [initials.jpg]
 
Page 3 of 27

--------------------------------------------------------------------------------

THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 

·  
Cumulative Irritation Combination Study (XX Subject to complete) - Core Tech
Placebo Transdermal System, (00μg/hr, 10 cm2, 0.0 mg/24hr);

 

·  
 Completion of Clinical Studies;

 

·  
XX Year  Stability Study of Clinical and Registration Batches; and,

 

·  
 ANDA Compilation and Filing with U.S. FDA.

 
2.3. Manufacturing Activities. Core Tech shall provide the following services in
relation to the approval of a Fentanyl Transdermal System, equivalent, according
to the U.S. FDA, to the brand product Duragesic®, manufactured by a division of
Johnson and Johnson.;
 
 
· Manufacturing of Process Validation Batches, 5 strengths, 3 batches per
strength, XX patches/batch for 5 cm2, 10 cm2, 20 cm2 and XX patches/batch for 30
cm2, 40 cm2 (total all the strengths combined XX patches)
 
· Launch batches - Following regulatory approval, manufacture Fentanyl
Transdermal System in conformity with mutually agreed quantities;
 
· Delivery of approved products to RxElite in mutually agreed minimum lot sizes
and FDA-approved packaging, delivered to mutually determined locations according
to mutually agreed schedules;
 

·  
Establish and support warranties against defects in manufacture or packaging of
products;

 

·  
Execute any supplementary filings to regulatory authorities in connection with
manufacture of products; and,

 
initials [initials.jpg]
 
Page 4 of 27

--------------------------------------------------------------------------------

THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
· Sell to RxElite product at the cost which will be reset according to actual
audited costs quarterly. The estimated costs for each carton (1 patch/pouch, 5
pouches / carton - 5-pack configuration carton), not including product
packaging, Instructions for Use, product inserts and shipping cases, is
presented below. Raw material cost fluctuations may impact transfer pricing.
These estimates are based upon the mutually agreed upon minimum quantity of XX
million patches XX Year. XX
 
Estimated Transfer
Price from Core Tech to RxElite*
 
Patch Size
 
Price/Single Patch
 
Price/5 Patches per Carton
12.5 μg/hr
 
5 cm2
 
XX/patch
 
$XX/carton
25 μg/hr
 
10 cm2
 
XX /patch
 
$XX/carton
50  μg/hr
 
20 cm2
 
XX /patch
 
$XX/carton
75 μg/hr
 
30 cm2
 
XX /patch
 
$XX/carton
100 μg/hr
 
40 cm2
 
XX /patch
 
$XX/carton

 
*Note: XX
 
2.4  Core Tech shall grant RxElite a first right of refusal to develop,
manufacture and distribute any other generic transdermal system (patch products,
including the generic form of XX [XX patch]) for itself or a client. RxElite
will respond to any first right of refusal within 30 days and if terms are
agreed upon by both parties, commence development within 90 days of the first
right of refusal.
 
Initials [initials.jpg]
 
Page 5 of 27

--------------------------------------------------------------------------------

 
THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
2.5 If Core Tech is unable to file an ANDA within 30 months for a Fentanyl
Transdermal System, equivalent, according to the U.S. FDA, to the brand product
Duragesic®, manufactured by a division of Johnson and Johnson or Core Tech
chooses to no longer pursue an approval, then RxElite shall have foil access to
and a right to utilize all work created during the filing process on a royalty
free non-exclusive basis for its own uses separate of Core Tech. This condition
shall be considered null and void if RxElite defaults on the responsibilities of
this agreement causing delays in the Core Tech ANDA submission.
 
Article III - RxElite Responsibilities
 
· 3.1. Development Funding and Clinical Studies. RxElite shall provide the
following services in relation to the development support of a Fentanyl
Transdermal System, equivalent, according to the U.S. FDA, to the brand product
Duragesic®: XX by wire transfer within 3 business days of the signing of this
agreement by both parties; and
 
· XX
 
· XX 
 
Of the above funding, XX is allocated for reimbursement of clinical study
expenses to be incurred during the FDA regulatory approval process.
 
3.2. US Process Validation. RxElite shall provide the following services in
relation to the product validation lots and US regulatory support of a Fentanyl
Transdermal System:
 
Initials [initials.jpg]
 
Page 6 of 27

--------------------------------------------------------------------------------

 
THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
 
· An estimated additional XX transfer to produce required process validation
batches in relation to the ANDA approval (this product is intended to be sold
under the profit share terms of this agreement, once FDA approval has been
finalized). Funding to be received within 30 days of filing of ANDA. Estimated
pricing reflects XX  patches at a projected cost of XX per patch. Actual pricing
including above mentioned packaging requirements to be provided by Core Tech at
the time of manufacture. Core Tech and RxElite will jointly determine the final
Product Process Validation schedule requirements.
 
The above payments shall be considered payment in full to Core Tech for the
development and approval of an ANDA for the Fentanyl Transdermal System,
equivalent, according to the U.S. FDA, to the brand product Duragesic®. All
development, clinical, process validation, and regulatory approval payments are
non-refundable. Any payment amount or payment timeline not met by RxElite shall
null and void this agreement, unless agreed upon by both parties in writing.
Additional funding to procure expanded manufacturing capacity or to purchase
initial product inventories may be addressed at any time and must be agreed upon
in writing by both Parties. Both parties shall have access to review ANDA filing
documents paid for and completed during the term of this agreement for viewing
and verification purposes only.
 
If this agreement becomes null and void due to default on payments from RxElite
to Core Tech, then Core Tech shall reimburse RxElite the full amount paid to
date by RxElite, minus external fees and expenses specific to this agreement
(including expenses associated with procuring a new distribution partner),
within three years of FDA approval and the commencement of sales of the Fentanyl
transdermal system produced by Core Tech, equivalent, according to the U.S. FDA,
to the brand product Duragesic®, manufactured by a division of Johnson and
Johnson. In the event of default, Core Tech will own and maintain the rights of
the licensed product to continue all research, regulatory, development,
clinical, marketing and distribution activities at its own discretion. If Core
Tech is unable to sign and execute an equivalent partnership agreement with an
alternate manufacturing and distribution entity for the sales of the Fentanyl
transdermal system within one year of RxElite's default, all monies invested
will be retained by Core Tech.
 
Initials [initials.jpg]
 
Page 7 of 27

--------------------------------------------------------------------------------

 
THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
3.3 Worldwide Regulatory Filing. RxElite shall provide the following services in
relation to the worldwide regulatory support of a Fentanyl Transdermal System:
 
3.3.1 EU Funding for Clinical Studies and Regulatory Filings: RxElite shall pay
Core Tech an additional XX within one year of the signing of this agreement, and
an additional XX within XX of signing this agreement XX to secure the Worldwide
marketing, sales and distribution rights for the Fentanyl Transdermal System.
 
3.3.2 If RxElite chooses not pay to for non-U.S. rights, all other terms of this
agreement remain binding and at that time, Core Tech will own and maintain the
non-U.S. rights of the licensed product to continue all research, regulatory,
development, clinical, marketing and distribution activities at its own
discretion.
 
3.3.3 Clinical Studies: This payment shall be applied to regulatory, clinical
and filing costs in Europe (EU) for approval of the Fentanyl Transdermal System
equivalent  to regulatory authority to the brand product Duragesic.
 
3.3.4 Product Validation: RxElite shall pay in addition to the above, by wire
transfer, all necessary costs for process validation batches necessary for the
approval in each respective country , and this product will be sold under the
profit share terms of this agreement, once approval has been finalized in each
country. Additional development fees for further country filings shall be agreed
upon by both parties and paid to Core Tech from RxElite as due for each country
filing.
 
3.4. Marketing and Distribution. RxElite shall provide the following services in
relation to the marketing and distribution of a Fentanyl Transdermal System,
equivalent, according to the U.S. FDA, to the brand product Duragesic®,
manufactured by a division of Johnson and Johnson:
 
Initials [initials.jpg]
 
Page 8 of 27

--------------------------------------------------------------------------------

 
THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
a) Develop and execute a sales and marketing plan consistent with manufacturing
targets established by both companies;
 
b) Provide market research and analysis to support product manufacturing and
marketing;
 
c) Coordinate customer service with information and processing of warranty
claims;
 
d) Provide warehousing and logistics to support distribution of products and
maintain accurate distribution records;
 
e) Staff a Post-Approval Compliance Program that will log customer complaints
and oversee adverse events reporting; and,
 
f) RxElite will assist Core Tech in managing and qualification of expansion,
build out and secure vault activities that are required or advantageous to the
production of the licensed product.
 
3.5. Manufacturing Requirements. RxElite shall provide a Fentanyl Transdermal
System manufacturing product requirement schedule to Core Tech including: a
two-year rolling forecast, six month committed delivery projections and monthly
purchase orders. Orders will be finalized and firm and binding 90 days in
advance of each monthly order.
 
3.5.1. Manufacturing Minimum Orders. RxElite will guarantee the purchase of a
minimum of XX Fentanyl Transdermal System patches XX of the licensed product per
year throughout the duration of this contract commencing with the year ANDA
approvals is obtained. For this requirement, a year will be defined as
commencing from the date of ANDA approval or release for sale of the first
commercially available batch whichever comes last and its subsequent yearly
anniversary dates. Any portion of the year in which this agreement is in effect
will be deemed a full year for the purposes of maintaining the minimum
manufacturing requirement obligations on a prorated basis.
 
Initials [initials.jpg]

Page 9 of 27

--------------------------------------------------------------------------------

THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
3.5.2. If RxElite purchases less than the minimum quantities outlined in this
Agreement then RxElite shall have up to 90 days to "Catch Up", by ordering
increased quantities equal to the shortfall for the previous year during the
Catch Up period. Manufacturing Minimums can be adjusted higher or lower by
written agreement of both parties. If Core Tech is unable to supply enough
product during the Catch Up period to satisfy minimums, then the catch up period
shall be extended until all Catch Up product is supplied by Core Tech.
 
3.5.3. If RxElite does not meet its manufacturing minimums, and is not able to
Catch Up according to Section 3.4.1, then RxElite shall lose its exclusive
rights to the U.S. market. If exclusivity is lost by RxElite, then all other
terms of this agreement EXCEPT SECTION 2.4 AND SECTION 16 shall remain in full
force on a non-exclusive basis, with minimum orders of 2 million patches per
order required. RxElite will not have any profit sharing participation or
royalty for Core Tech produced product for customers other than RxElite or its
licensees if exclusivity is lost.
 
3.5.4. Manufacturing Minimum Production. Core Tech will guarantee the production
of a minimum of XX Fentanyl Transdermal System patches XX the licensed product
per year throughout the duration of this contract commencing with the year ANDA
approvals is obtained. For this requirement, a year will be defined as
commencing from the date of ANDA approval or release for sale of the first
commercially available batch whichever comes last and its subsequent yearly
anniversary dates. Any portion of the year in which this agreement is in effect
will be deemed a full year for the purposes of maintaining the minimum
manufacturing requirement obligations on a prorated basis.
 
Initials [initials.jpg]

Page 10 of 27

--------------------------------------------------------------------------------

THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
3.5.5. If Core Tech produces less than the minimum quantities outlined in this
Agreement then Core Tech shall have up to 90 days to "Catch Up", by producing
increased quantities equal to the shortfall for the previous year during the
Catch Up period. Manufacturing Minimums can be adjusted higher or lower by
written agreement of both parties. Core Tech retains the right to qualify
another manufacturing supply source separate of the Core Tech facility,
utilizing the ANDA developed by Core Tech as part of this agreement, and RxElite
will cooperate in facilitating a second source to meet licensed product
requirements.
 
3.5.6. If Core Tech does not meet its manufacturing minimums, and is not able to
Catch Up according to Section 3.5.1, then RxElite shall be allowed to qualify
second manufacturing supply source separate of Core Tech, utilizing the ANDA
expertise developed by Core Tech as part of this agreement, and Core Tech will
cooperate with RxElite in facilitating the qualification of a second facility,
at the expense of RxElite. The production outside of Core Tech to meet minimum
shortfalls according to the terms of this Section 3.5.2 shall be on a royalty
free basis with no profit share.
 
3.6 Deliveries. All deliveries under this Agreement shall be made FOB to one of
RxElite's warehouse, as set forth in the order for the applicable Products.
 
3.7 Risk of Loss. Risk of loss of any kind to the Products manufactured and
shipped pursuant to this Agreement shall rest with Core Tech during the
manufacturing process and shipment to RxElite. Upon delivery to and written
acceptance of the Product by RxElite, the risk of loss shall pass to RxElite.
Nothing in this Section is intended to restrict or eliminate RxElite's right to
revoke acceptance or reject nonconforming goods as permitted under the Uniform
Commercial Code, or otherwise enforce the terms of any express or implied
warranty associated with the goods. The intent of this Section is solely to
allocate the risk of loss due to casualty or otherwise, including, without
limitation, deterioration, breakage, accidental loss, and acts of god.
 
Article IV - Grant: Sublicenses
 
4.1. Grant. Subject to the terms and conditions set forth herein, Core Tech
hereby grants to RxElite, to the extent that it lawfully may, use of the
Technology only for the purpose of marketing, selling, and distributing Fentanyl
Transdermal System in the Territory (the "License").
 
Initials [initials.jpg]
 
Page 11 of 27

--------------------------------------------------------------------------------

THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
4.2. Reserved Rights. Core Tech reserves to itself (a) all rights not granted to
RxElite hereunder, including the rights to use and permit the use of the product
and technology for any purpose not in conflict with the provisions of the
License, and (b) notwithstanding the terms of the License, the right at all
times to make, have made, and use Licensed Products for Core Tech's own research
purposes.
 
4.3. Sublicenses. RxElite shall also have the right to grant to its subsidiaries
or other sub-Licensees, exclusive or non-exclusive sublicenses under the License
during the License Period, provided, however, and RxElite agrees that:
 
a) the terms and conditions of each sublicense shall be consistent with the
terms and conditions of this Agreement;
 
b) each sublicense shall provide that the obligations to Core Tech of this
Agreement shall be binding on the sub-Licensee and be enforceable by Core Tech
upon RxElite;
 
c) Core Tech shall have the right to approve any sublicense to a company not
owned partially or fully by RxElite, that grants exclusive rights of any kind to
anyone, such approval not to be unreasonably withheld;
 
d) RxElite shall furnish to Core Tech a true and complete copy of each
sublicense agreement and each amendment thereto, promptly after the sublicense
or amendment has been agreed upon;
 
Initials [initials.jpg]
 
Page 12 of 27

--------------------------------------------------------------------------------

 
THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
e) No Subsidiary or other sub-Licensee shall have the right to further license,
sublicense, or assign its rights without the written
approval of Core Tech;
 
f) No sublicense shall relieve RxElite of any of its obligations hereunder, and
RxElite shall be responsible for the acts or omissions of its Subsidiaries and
sub-Licensees and for compliance by them with their obligations, and RxElite
shall take all steps necessary to enforce that compliance to the extent required
to allow RxElite to fully comply with all of its obligations under this
Agreement; and,
 
g) RxElite shall not receive from sub-Licensees anything of value in lieu of
cash payments in consideration for any sublicense under this Agreement without
the prior written consent of Core Tech, which consent will not to be
unreasonably withheld.
 
ARTICLE V - PROFIT PAYMENTS. RECORDS.
 
5.1. Profits. RxElite and Core Tech shall split profits obtained from the sale
of the licensed product XX. Profits shall be calculated as defined in Section
1.6. Core Tech's transfer price shall be all direct costs plus an agreed upon
overhead allocation.
 
5.2. Statements; Payments. RxElite shall, within thirty (30) days after the last
days of March, June, September, and December in each year or portion thereof
during the License Period, and within thirty (30) days after the end of the
License Period, provide Core Tech with a statement accounting for the Gross
Sales of Licensed Products by RxElite, its Subsidiaries, and its sub-Licensees
(and with copies of the corresponding statements to RxElite from its
subsidiaries and sub-Licensees), for the immediately preceding three (3) month
period or portion thereof, accompanied by statement of Net Profit calculation
and payment for all amounts collected from RxElite customers under this Article
V for that period or portion thereof. Each such statement shall be certified by
the Chief Executive Officer of RxElite as being true, correct, and complete, and
shall include at least the following: Gross Sales calculations and number of
units of different Licensed Products manufactured, sold and otherwise disposed
of; total billings for each Licensed Product sold; accounting for all applicable
Gross Sales calculations and deductions allowed; accounting for all applicable
Net Profit calculations and deductions allowed; and payment due.
 
initials [initials.jpg]
 
Page 13 of 27 

--------------------------------------------------------------------------------

 
THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
5.3. Records. Audits. Both Parties shall keep (and cause to be kept) and
maintain complete and accurate records of all manufacturing related costs, raw
material costs, Gross Sales of the Licensed Products and accounting for all
applicable Net Profit calculations and deductions by RxElite, its Subsidiaries,
and, its sub-Licensees, in accordance with generally accepted accounting
procedures. Such records shall be accessible to independent certified public
accountants selected by either Party and reasonably acceptable to the other
Party, by audits conducted not more than once a year during the License Period
and for one year after the termination thereof, at any reasonable times during
business hours, for the purpose of verifying Core Tech product transfer price,
Net Profits and any fees due thereon. Such accountants shall disclose to both
Parties only information relating to the accuracy of the records kept and the
payments made, and shall be under a duty to keep confidential any other
information obtained from such records. Both Parties, their Subsidiaries, and
their sub-Licensees shall not be required to retain such records for more than
five (5) years after the close of any calendar quarter-year.
 
5.4. Substantial Underpayment of Profit Share or Overcharge of Transfer Price.
If any such audit reveals that the aggregate paid during any four consecutive
calendar quarters was more than five percent (5%) more or less than the amount
that should have been paid, then the reasonable expenses of the audit shall be
borne by the other Party, which shall pay those expenses within thirty (30) days
after demand therefore by the other Party accompanied by the accountants'
statement therefore and its sub-Licensees, in accordance with generally accepted
accounting procedures. Such records shall be accessible to independent certified
public accountants selected by either Party and reasonably acceptable to the
other Party, by audits conducted not more than once a year during the License
Period and for one year after the termination thereof, at any reasonable times
during business hours, for the purpose of verifying Core Tech product transfer
price, Net Profits and any payments due thereon. Such accountants shall disclose
to either Party only information relating to the accuracy of the records kept
and the payments made, and shall be under a duty to keep confidential any other
information obtained from such records. Both Parties, their Subsidiaries, and
their sub-Licensees shall not be required to retain such records for more than
five (5) years after the close of any calendar quarter-year.
 
initials [initials.jpg]
 
Page 14 of 27 

--------------------------------------------------------------------------------

 

THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
Core Tech product transfer price, Net Profits and any payments due thereon. Such
accountants shall disclose to either Party only information relating to the
accuracy of the records kept and the payments made, and shall be under a duty to
keep confidential any other information obtained from such records. Both
Parties, their Subsidiaries, and their sub-Licensees shall not be required to
retain such records for more than five (5) years after the close of any calendar
quarter-year.
 
5.4.1. Any Underpayment of Profit Share or Overcharge of Transfer Price shall be
paid back to the other Party within 30 days after discovered and presented in
writing to the other Party according to the provisions of section 5.4 of this
Agreement.
 
ARTICLE VI - REGULATORY APPROVAL AND MAINTENANCE
 
6.1 Regulatory Approval Ownership and Maintenance. Core Tech shall own, hold and
maintain the U.S. FDA Abbreviated New Drug Application (ANDA) and any other
regulatory approvals from other countries of the Fentanyl transdermal systems
and shall pay all reasonable costs associated with ANDA maintenance throughout
the license agreement.
 
6.2 Recall of Products. In the event Core Tech shall be required (or shall
voluntarily decide) to initiate a recall, withdrawal, or field correction of any
Product manufactured as part of this Agreement, whether or not such recall has
been requested or ordered by any state or Federal agency, Core Tech shall notify
RxElite within one (1) business day, and RxElite shall follow any other
instructions reasonably provided by Core Tech. Core Tech shall bear all costs
and expenses associated with any recall, withdrawal, or field correction as a
result of any negligence or intentional misconduct of Core Tech , and shall
reimburse RxElite for all costs and expenses reasonably incurred by RxElite as a
result thereof. If, however, a recall, withdrawal or field correction is
initiated by RxElite as a result of any negligence or intentional misconduct of
RxElite (and not resulting from the quality of Core Tech's services, or any
non-compliance with the terms and conditions of this Agreement or any defect in
any of the Products including, without limitation, any adulteration, damage or
other non-conformity), RxElite shall bear its costs and expenses with respect
thereto and shall reimburse Core Tech for all costs and expenses reasonably
incurred by Core Tech as a result thereof.
 
initials [initials.jpg]
 
Page 15 of 27

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THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
6.3 Returns. Core Tech shall reimburse RxElite for the cost and expense of any
Licensed Products returned to RxElite as a result of any:
 
a) Recall, withdrawal or field correction,
 
b) Defect (whether inherent or otherwise) in any Products supplied by Core Tech
hereunder (including, without limitation, any adulteration, damage or other
non-conformity), determined to have occurred prior to product acceptance by
RxElite, and/or
 
c) Any negligence or intentional misconduct of Core Tech.
 
6.4 Adverse Events. During the Term, Core Tech shall be responsible for
reporting to the appropriate regulatory authorities all adverse experiences
reported to it with respect to the Products manufactured and supplied by Core
Tech in accordance with all applicable laws and regulations. Each party shall
provide to the other party the name of an appointed safety representative of
such party to whom all adverse experiences reports and queries shall be
reported, and the parties shall mutually agree upon procedures for adverse event
reporting to each other and to the appropriate regulatory authorities in
accordance with applicable laws and regulations.
 
ARTICLE VII - CONFIDENTIALITY
 
7.1. Limitations on Use, Disclosure. Parties agree to treat as confidential, and
to use and disclose only for the purposes of making Licensed Products, all
Confidential Technology. Parties agree that they will exercise every reasonable
precaution to prevent the disclosure of Confidential Technology by any of their
directors, officers, employees, or agents to other parties, other than to
Subsidiaries and to RxElite sub-Licensees. Any Confidential Technology disclosed
to Subsidiaries or sub-Licensees shall be disclosed on the basis of and subject
to the confidentiality provisions of this Agreement. RxElite agrees to limit the
disclosure of the Confidential Technology to those in RxElite, its Subsidiaries,
and its sub-Licensees who have been identified in writing to Core Tech, who have
a need to know for the purpose of making Licensed Products, and who have been
instructed by RxElite on the terms of this Agreement and have agreed to comply
with those terms both on behalf of their employers and as individuals.
 
initials [initials.jpg]
 
Page 16 of 27

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THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
7.2. Cessation. Any information which is Confidential Technology at the date of
disclosure thereof to RxElite shall cease to be Confidential Technology, and
RxElite, its Subsidiaries, and its sub-Licensees shall be released from the
provisions of Section 7.1 at to such information on the date when, through no
act or omission on the part of RxElite, its Subsidiaries, or its sub-Licensees,
such information becomes (a) publicly known by way of a single publication in
which such Confidential Technology is disclosed in reasonable detail, or (b) so
widely known and used in combination that it can be said to be generally
available to the public. The minimum payments and fees due to Core Tech
hereunder with respect to Net Profits, shall not in any way be reduced or
otherwise adversely affected by reason of any Confidential Technology ceasing to
be or failing to have the characteristics of Confidential Technology as defined
herein.
 
7.3. Time Limit. The provisions of this Article V shall continue to apply to any
information which is Confidential Technology for so long as it shall remain
such, notwithstanding any termination of this Agreement or the License or
expiration of the License Period, provided, however, that the obligations of
confidentiality under this Article shall in any event expire and cease to exist
three (3) years from the date of Termination of this agreement.
 
ARTICLE VIII - DILIGENCE
 
RxElite agrees to use its best efforts to effect introduction of Licensed
Products in the Field of Use into the commercial market as soon as practical,
consistent with sound and reasonable business practices and judgments. Except as
listed below, Core Tech shall have the right to terminate the License and Core
Tech's obligations under this Agreement if Licensee fails to perform activities
toward commercialization of the Licensed Products as measured by specific
minimum purchased quantities outlined in this agreement as outlined in Section
3.5. If RxElite purchases less than the minimum quantities outlined in this
Agreement then RxElite shall have up to 90 days to Catch Up, by ordering
increased quantities equal to the shortfall for the previous year during the
Catch Up period.
 
initials [initials.jpg]
 
Page 17 of 27 

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THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
Core Tech shall dedicate sufficient manufacturing capacity on a continuous basis
throughout the term of this agreement to manufacture the Products to be supplied
to RxElite and will use its best effort to deliver all RxElite orders in a
timely manner. If Core Tech is not able to deliver an order within 90 days of
order then the minimum order requirement for that period of time will be waved
on a pro rata basis vs. the annual minimum. As soon as Core Tech is able to
deliver orders in a timely manner after a delay, then required minimums shall
resume. If a second site is qualified as outlined in Section 3.5.6 then annual
minimums for both parties will be reduced by the amount produced at the
secondary site.
 
ARTICLE IX - COMMITMENT AND RELEASE
 
9.1. During the term of this agreement, Core Tech and RxElite will not cooperate
with any other third party that is involved in development, marketing, sales or
distribution of the Licensed Products in the Field of Use without mutual
disclosure and prior agreement.
 
9.2. Both Parties are free to pursue their other collaborations or partnerships
outside of the Licensed Products in the Field of Use.
 
ARTICLE X - REPRESENTATIONS, WARRANTIES, AND LIMITATIONS
 
10.1. Compliance with Laws. Core Tech shall comply with all applicable laws and
regulations (including, without limitation, all FDA requirements and licenses)
in performing its obligations under this Agreement. Without limiting the
foregoing, Core Tech shall conduct its manufacturing and delivery operations
consistent with current good manufacturing practices ("cGMP") in the U.S.
pharmaceutical industry and all applicable laws and regulations (including,
without limitation, all FDA regulatory requirements and current cGMP as set
forth in 21 C.F.R. §§ 210 and 211 for methods to be used in, and the facilities
or controls to be used for, the manufacture, processing, packing and handling of
any Products to assure that it is safe, and has the identity and strength and
meets the quality and purity characteristics that it purports, or is represented
to possess).
 
 
Initials [initials.jpg]

Page 18 of 27

--------------------------------------------------------------------------------

THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
10.2. Manufacturing Standards. Core Tech shall manufacture and supply all
Products in accordance with the Specifications for the Products and shall ensure
that all Products, upon delivery to RxElite's warehouse, (a) meet the applicable
Specifications for such Products, and (b) have at least 20 months of shelf life.
 
10.3. Core Tech Representations. Core Tech represents and warrants to RxElite
that:
 
a) Core Tech is a corporation organized and existing under the laws of the State
of New Jersey and has the power and authority to enter into this Agreement.
 
b) Core Tech has taken all necessary action to authorize its execution and
delivery of this Agreement by the representatives of Core Tech who carried out
such execution and delivery, and to authorize the performance by Core Tech
of-its obligations hereunder.
 
c) Execution and delivery of this Agreement and its performance by Core Tech
will not result in any breach or violation of, or constitute a default under,
any agreement, instrument, judgment, or order to which Core Tech is a party or
by which it is bound.
 
10.4 RxElite Representations. RxElite represents and warrants to Core Tech that:
 
a) RxElite is a corporation organized and existing under the laws of State of
Delaware and has the power and authority to enter into this Agreement.
 
Initials [initials.jpg]
 
Page 19 of 27

--------------------------------------------------------------------------------

THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
b) RxElite has taken all necessary action to authorize its execution and
delivery of this Agreement by the representatives of RxElite who carried out
such execution and delivery, and to authorize the performance by RxElite of its
obligations hereunder.
 
c) Execution and delivery of this Agreement and its performance by RxElite will
not result in any breach or violation of, or constitute a default under, any
agreement, instrument, judgment, or order to which RxElite is a party or by
which it is bound.
 
ARTICLE XI - INDEMNITY, INSURANCE, INFRINGERS
 
11.1. Indemnification. Core Tech agrees to defend, indemnify, and hold RxElite
harmless from any claims of any kind, whether in tort, contract, equity, or law,
arising from or relating to the goods manufactured and supplied by Core Tech
pursuant to this Agreement or any failure of Core Tech to comply with the terms
and conditions of this Agreement, except if and to the extent any such claims
arise from or relate to (a) defects in the Products sold by RxElite if those
defects were determine to have occurred due to damage or adulteration caused by
RxElite (including, without limitation, any adulteration, damage or other
non-conformity), (b) any negligence or intentional misconduct of RxElite, or (c)
any failure by RxElite to comply with the terms and conditions of this
Agreement. RxElite agrees to defend, indemnify, and hold Core Tech harmless from
and against any and all third party claims asserted against Core Tech resulting
from any negligence or intentional misconduct of RxElite, except if and to the
extent any such claims arise from or relate to (d) defects determined to have
occurred at time of manufacture according to cGMP guidelines and according to
the specifications of the approved ANDA or regulatory approval in each
respective country or jurisdiction, and/or standards, storage or handling by
Core Tech in the Products (whether inherent or otherwise) sold by RxElite if
those Products were manufactured or supplied by or on behalf of Core Tech
(including, without limitation, any adulteration, damage or other
non-conformity), (e) any negligence or intentional misconduct of Core Tech, or
(f) any failure by Core Tech to comply with the terms and conditions of this
Agreement.
 
Initials [initials.jpg]
 
Page 20 of 27

--------------------------------------------------------------------------------

THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
11.2. Defense, Settlement. Each Party will pay its own legal expense in defense
of any claim against such Party not indemnified in Section 11.1
 
11.3. Insurance. Core Tech agrees to obtain and maintain a policy of general
liability insurance upon commencement of clinical evaluation and throughout the
rest of the Term of this Agreement insuring against loss for all commercial
liability, including products liability, with minimum policy limits of at least
Ten Million Dollars per occurrence. RxElite shall be designated as an additional
insured on the licensed products and policy coverage shall not be canceled or
reduced except upon at least 30 days' written notice to RxElite. Upon RxElite's
request, Core Tech shall provide a certificate of insurance to RxElite at any
time during the Term of this Agreement. RxElite agrees to obtain and maintain a
policy of general liability insurance upon commencement of clinical evaluation
and throughout the rest of the Term of this Agreement insuring against loss for
all commercial liability, including products liability, with minimum policy
limits of at least Ten Million Dollars per occurrence. Upon Core Tech's request,
RxElite shall provide a certificate of insurance to Core Tech at any time during
the Term of this Agreement.
 
ARTICLE XII - TERM, TERMINATION AND RENEWAL
 
12.1. The original term of this agreement shall be 8 years. The agreement shall
be auto-renewed for successive 1 year periods as long as RxElite continues to
purchase the minimum required quantities.
 
initials [initials.jpg]
 
Page 21 of 27

--------------------------------------------------------------------------------

 
THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
12.2. Events. The Agreement may be terminated by either Party pursuant one of
the following subsections:
 
a) Material Default. If either party shall fail after thirty (30) days written
notice from the other party to pay the other party any fees or other payments
due and payable hereunder, or shall fail in any material way to perform any
other agreement required to be performed under this Agreement, or if any
Subsidiary or sub-Licensee shall be in material breach of any conditions or
obligations affecting the other party and compliance with which both parties are
responsible for hereunder, or if any representation or warranty of either party
contained in this Agreement shall prove to have been inaccurate or misleading in
any material way when made (referred to collectively and individually as a
"material default"), then, without limitation of and in addition to any and all
other rights and remedies available to either party with respect to such
material default, either party may terminate the Agreement and their obligations
hereunder by written notice to the other party at any time after the expiration
of such thirty (30) day notice period if the other party has not cured the
material default and the effects thereof within the 30 day notice period.
 
ARTICLE XIII - NOTICE
 
Any notice or communication required to be given hereunder in writing shall be
given by registered or certified mail, return receipt requested, or delivered by
courier, return receipt requested, charges and postage prepaid, addressed to the
parties, respectively, at the addresses of their principal offices stated above
or at such other respective substitute addresses as the addressee may designate
in writing to the other party.
 
IF TO RXELITE: Jonathan Houssian, President, RxElite, Inc., 1404 North Main,
Suite 200, Meridian, ID 83642; Tel. (208) 288-5550, Fax. (208) 288-1191.
 
IF TO CORE TECH: Dr. Kirti Valia, President & CEO, Core Tech Solutions, Inc., 50
Lake Drive, East Windsor, NJ 08520-5321; Tel. (609) 443-1400 Fax. (609)
443-1401.
 
initials [initials.jpg]
 
Page 22 of 27

--------------------------------------------------------------------------------

 
THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.

 
ARTICLE XIV - MISCELLANEOUS PROVISIONS.
 
14.1. Assignment. Both Parties shall not assign the License or this Agreement
without the prior written consent of the other Party, which consent shall not be
unreasonably withheld in the case of the other Party's sale of all or
substantially all of its business, if the assignee shall assume all obligations
under this Agreement. In any event, no assignment or other transfer by the
Parties shall relieve them of any obligations hereunder and they shall always
continue to be primarily and jointly and severally liable (along with such
assignee or other transferee) for the performance of all obligations of the
original Party and such assignee or other transferee hereunder.
 
14.2. Compliance with laws. Both parties agree that they, their Subsidiaries,
and its sub-Licensees will comply with all applicable mandatory or permissive
patent marking laws, rules, and regulations and comply with all other laws,
rules, and regulations of all governmental authorities applicable to any of
their activities contemplated by this Agreement, and will comply with all
necessary and desirable practices in connection therewith, such as any
appropriate-products liability labeling and compliance with safety
recommendations of trade associations or governmental authorities.
 
14.3. Independent Contractors. The parties hereto shall be independent
contractors with respect to each other, and nothing contained herein shall be
construed as constituting either of them as the agent, principal, employee,
servant, joint venturer, or partner of the other for any purpose whatsoever.
 
14.4. Non-solicitation. During the term of this Agreement and for two (2) year
after its termination, RxElite and Core Tech agree that neither shall directly
or indirectly solicit for employment any staff of the other party who have been
directly and substantively involved in performance under this Agreement. The
parties further agree not to take any action that would attempt to get around
this restriction such as assisting or enabling a third party to solicit.
 
initials [initials.jpg]
 
Page 23 of 27 

--------------------------------------------------------------------------------

 
THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
14.5. Governing Law. This Agreement shall be governed by and construed in
accordance with Delaware law.
 
14.6. Sole Agreement. This Agreement and any Exhibits annexed hereto (each of
which is hereby made part hereof by this reference), and any other documents
which may be expressly incorporated by reference herein, constitute the entire
and only agreement between the parties concerning the subject matter hereof; and
all prior negotiations, representations, warranties, agreements, and
understandings related thereto are superseded hereby.
 
14.7. Severability. If any provision of this Agreement shall to any extent be
found to be invalid or unenforceable, the remainder of this Agreement shall not
be affected thereby, and any such invalid or unenforceable provision shall be
reformed so as to be valid and enforceable to the fullest extent permitted by
law.
 
14.8. Headings. Headings of Articles, Sections, and subsections included herein
are for convenience of reference only and shall not be used to construe this
Agreement.
 
14.9. This Agreement may not be released, discharged, abandoned, amended, or
modified in any manner, except by an instrument in writing signed on behalf of
each of the Parties by their duly authorized representatives.
 
14.10. The Parties shall pay their own expenses incident to the preparation of
this Agreement and the related agreements contemplated therein.
 
14.11. The Agreement may be executed in any number of counterparts, each of
which shall be treated as an original but all of which, collectively, shall
constitute a single instrument.
 
14.12. Core Tech and RxElite have participated jointly in the negotiation and
drafting of this Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the Parties and no presumption or burden of proof shall arise favoring or
disfavoring any party by virtue of the authorship of any of the provisions of
this Agreement.
initials [initials.jpg]
 
Page 24 of 27

--------------------------------------------------------------------------------

 
THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
ARTICLE XV - ARBITRATION
 
15.1. Arbitration. All disputes, controversies, or differences which may arise
between the parties out of or in relation to or in connection with this
Agreement, or for the breach thereof, which cannot be resolved by mutual
agreement, shall be finally settled by arbitration to be held in accordance with
the Commercial Arbitration Rules (the "Rules") of the American Arbitration
Association (the, "Association") as the Rules then exist. Both legal and
equitable remedies shall be available to the arbitrator(s). The arbitration
award shall be final and binding on the parties hereto and shall be enforceable
in any court having jurisdiction.
 
ARTICLE XVI - XX
 
 XX
 
initials [initials.jpg]
 
Page 25 of 27

--------------------------------------------------------------------------------

 
THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.

 
 XX
 
ARTICLE XVII - EFFECT OF PARTIAL INVALIDITY
 
17.1 The invalidity of any part of this Agreement shall not be deemed to affect
the validity of any other part of this Agreement. In the event that any
provision of this Agreement is held to be invalid or unenforceable, the parties
agree that the remaining provisions shall be deemed to be in full force and
effect as if they had been executed by both parties subsequent to the
expungement of the invalid or unenforceable provision. If a provision is deemed
invalid or unenforceable due to its scope or breadth, such provision shall be
deemed valid to the extent of the scope or breadth permitted by law.
 
ARTICLE XVIII - MISCELLANEOUS ITEMS
 
18.1  Entire Agreement. This Agreement shall constitute the entire Agreement
between the parties related to the subject matter hereof. Any prior
understanding, agreement or representation between the parties of any kind
(whether written or oral) preceding the date of this Agreement including all
previously signed agreements shall not be binding on either party except to the
extent expressly set forth in this Agreement.
 
18.2  Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute the same instrument.
 
18.3  No Waiver. The failure of either party to this Agreement to insist upon
the performance of any of its terms and conditions, or the waiver of any breach
of any of the terms and conditions of this Agreement, shall not be construed as
later waiving any terms and conditions, but they shall continue and remain in
full force and effect as if no forbearance or waiver had occurred.
 
initials [initials.jpg]
 
Page 26 of 27 

--------------------------------------------------------------------------------

 
THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN “XX”, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
 
Accepted:
 

        sig [sig.jpg]     11/07/2006

--------------------------------------------------------------------------------

Kirti H. Valia, Ph.D.
President and CEO
Core Tech Solutions, Inc.
    Date         EIN: 22-3588695               DNB: 06-843-1860                
      Accepted:                jonathan [jonathan.jpg]     11-9-2006

--------------------------------------------------------------------------------

Jonathan Houssian
President
RxElite, Inc.
   
Date
       
EIN:

--------------------------------------------------------------------------------

             
DNB:

--------------------------------------------------------------------------------

     

 
initials [initials.jpg]
 
Page 27 of 27

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