Document:

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    THE
      CONFIDENTIAL PORTIONS OF THIS EXHIBIT, WHICH
      HAVE BEEN REMOVED AND REPLACED WITH AN
      ASTERISK, 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.

     

    

     

    EXCLUSIVE
      MANUFACTURING AND DISTRIBUTION AGREEMENT

     

    This
      Exclusive Distribution Agreement (the "Agreement"), effective June 9, 2004
      (the
      "Effective Date"), is between MINRAD, INC., a Delaware corporation with offices
      at 847 Main Street, Buffalo, New York 14203, USA ("Manufacturer") and RxElite
      Holdings Inc., a Delaware corporation with offices at 1404 N. Main, Suite 200,
      Meridian, Idaho 83642 ("Distributor"). 

     

    Manufacturer
      and Distributor agree as follows: 

     

    1.
      Definitions
      

     

    "Affiliate"
      of a
      party hereto shall mean any person, corporation or other entity, which controls,
      is controlling or is under common control with such party. 

     

    "ANDA"
      shall
      mean abbreviated new drug application. 

     

    "Hospital
      Market"
      shall
      mean those accounts that purchase anesthetic agents for human use. 

     

    "Manufacturer's
      Representative"
      shall
      mean MINRAD Inc., which is a manufacturer's representative of Manufacturer
      with
      respect to the Products. 

     

    "NDC"
      means
      national drug code number. 

     

    "Products"
      shall
      mean the MlNRAD branded products set forth on Attachment
      A
      hereto.

     

    "Purchase
      Commitments"
      shall
      mean those outlined in Attachment
      A-1
      hereto.

     

    "Territory"
      shall
      mean the geographical area set forth in Attachment
      A-2
      hereto.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    2.
      Grant
      Exclusive Distributorship 

     

    2.1
      Appointment.
      Subject
      to Distributor's compliance with Section 2.2 hereof, Manufacturer hereby grants
      to Distributor for the Term the exclusive right to purchase the Products from
      Manufacturer for the sole purpose of selling the Products to end-use customers
      in the human market in the Territory, and Distributor accepts such grant,
      subject to the limitations, terms and conditions stated in this Agreement.
      Subject to any increases permitted hereunder, the initial prices for the
      Products shall be as set forth on Attachment
      A-1
      hereto.
      Distributor shall not itself manufacture or have manufactured for it or directly
      or indirectly sell, any products from third parties that are similar to the
      Products. Notwithstanding anything herein to the contrary, Manufacturer and
      Distributor acknowledge Manufacturer's right to sell, from time to time,
      Enflurane to Baxter, who bottles and markets the Products under its own name
      for
      the purpose of selling the Products to end-use customers in the human market
      in
      the Territory (the "Private Label Distributor"). 

     

    2.2
      Initial
      Order.
      Distributor agrees to place an initial non-cancelable stocking order for
      Products as set forth on Attachment
      A-1
      hereto
      at the time of signing (the "Initial Order"). The Sevoflurane component of
      the
      Initial Order is subject to and will be shipped after FDA approval has been
      received and any existing exclusivity granted by the FDA has expired.

     

    2.3
      Purchase
      Commitment.
      Distributor agrees to purchase Products from Manufacturer as set forth in
Attachment
      A-1
      hereto
      during the Term. The purchase commitment for Sevoflurane will commence when
      FDA
      approval to sell Sevoflurane in the Market has been received and any existing
      exclusivity granted by the FDA has expired. The Initial Order will be shipped
      by
      Manufacturer no later than October 2004 and will be considered as part of the
      Distributor's annual commitment for 2005. The terms of this Initial Order only
      will be net *. All subsequent orders will have terms as set forth in section
      4(b) of this Agreement. 

     

    2.4
      Pricing.
      Distributor will have sole control over market pricing and strategy relating
      to
      Products purchased by Distributor. Distributor market and pricing decisions
      with
      respect to sales by Distributor will be independent of the price of each Product
      as listed in Attachment
      A-1
      which
      Product prices are subject to change as set forth in Section 5.2. 

     

    2.5
      Other
      Accounts.
      Manufacturer has established various accounts for the Products in the Territory
      prior to the implementation of this agreement. Upon signature of this agreement,
      Manufacturer will effectively assign over to the Distributor all accounts and
      any purchases of product in the Territory from the signature date forward at
      the
      terms stipulated in this agreement and will decrement the annual purchase
      commitments outlined in Attachment
      A-1
      regardless if the product is Manufacturer labeled or co-labeled and regardless
      of the NDC number on the product. Effective assignment shall mean any means
      necessary for the contract to be fulfilled by Distributor through whatever
      means
      necessary to maintain a legal contract with customer. 

     

    3.
      Term
      and Renewal 

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

     

    3.1
      Term.
      This
      Agreement shall remain in effect for an initial term beginning on the Effective
      Date and ending on December 31, 2007 (the "Initial Term"). After the Initial
      Order, Distributor must purchase a minimum of * of the annual commitment during
      the first month of each calendar quarter beginning January 1, 2005 as specified
      in Attachment
      A-1.
      At the
      end of each calendar year during the Initial Term, Distributor must order
      Product to fulfill each year's annual commitment. Manufacturer will have 60
      days
      to deliver this order. This Agreement is subject to renewal for additional
      periods as set forth in Section 3.2 hereof (each a "Renewal Term" and together
      with the Initial Term, the "Term"). 

     

    3.2
      Renewal.
      After
      the expiration of the Initial Term and each Renewal Term, if any, this Agreement
      may be extended or renewed for successive one (1) year extension periods for
      so
      long as, and provided that, Distributor issues to Manufacturer a non-cancelable
      purchase order for an amount equal to the (highest annual commitment) of the
      Products as set forth on Attachment
      A-1
      hereto.

     

    Manufacturer
      must receive such purchase order from Distributor at least 60 days prior to
      the
      end of the previous term. Other than the initial order, the renewal terms will
      be consistent with section 3.1 and the other parts of this agreement.

     

    3.3
      New
      Products.
      During
      the Term and as long as the Distributor is not in breach of any part of this
      Agreement, Manufacturer will offer Distributor the right of first refusal to
      become its exclusive distributor in the Territory of any human generic
      pharmaceutical products (Manufacturer ANDA) that is a new Product and that
      the
      Manufacturer can legally offer. The offer will be on similar or better terms
      than ones the Manufacturer will offer or is willing to offer to any other third
      party in the human market. Distributor will have 30 days from the date
      Manufacturer provides written notice to exercise such right on the terms and
      conditions set forth in such notice. For the purpose of clarity, and not by
      way
      of limitation, Manufacturer's conscious sedation product is acknowledged by
      the
      parties to be a proprietary product and is specifically excluded from this
      Agreement. 

     

    4.
      Distributor's
      Duties 

     

    Distributor
      shall: 

     

    (a)
      submit its non-cancelable orders for the Products by written purchase order,
      it
      being agreed that the terms and conditions of Distributor's standard purchase
      order form shall not apply to transactions pursuant to this Agreement;

     

    (b)
      pay
      for such orders * net * from date of invoice (excluding only the Initial Order)
      in U.S. dollars and payment shall be made by wire transfer, check or letter
      of
      credit approved by Manufacturer; all prices are quoted FOB Bethlehem,
      Pennsylvania, USA. Past due amounts incur interest at the rate of * of the
      invoice amount per month or the highest rate allowable by law, whichever is
      less; 

     

    (c)
      provide to its customers instructions in the use of the Products and field
      service for such products in accordance with product information provided by
      Manufacturer; 

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

     

    (d)
      purchase the minimum commitment as per Attachment
      A-1.
      and use
      its best efforts to exceed these minimum commitments; 

     

    (e)
      refrain, outside the Territory and in relation to the Products, from seeking
      customers, from establishing any branch and from maintaining any distribution
      depot;

     

    (g)
      not
      give any warranties, above and beyond those in Article 9 hereto, to any end-use
      customers; 

     

    (h)
      provide instruction and assistance on compliance with any regulatory and
      labeling requirements of the Territory; However, Manufacturer remains solely
      responsible for compliance with all regulatory and labeling requirements of
      the
      Territory - in its role as holder of the ANDA. 

     

    (i)
      cooperate to a reasonable degree with Manufacturer to obtain any regulatory
      approval of the Products as required by the Territory; 

     

    (j)
      not
      use sub-distributors or any other agent, other than itself, without the prior
      written consent of the Manufacturer; 

     

    (k)
      have
      a Dedicated Head of Sales for the Hospital Market in place upon signing this
      Agreement; 

     

    (l)
      have
      a minimum of five (5) Hospital Market Field Sales Representatives in place
      within 3 months of signing this Agreement (one in each of the Manufacturer
      defined US Regions). A reasonable number will be added upon the launch of
      Sevoflurane as per mutual agreement between Manufacturer and Distributor;

     

    (m)
      provide monthly unit sales broken down by product, size and by hospital specific
      DEA code to Manufacturer within thirty (30) days of the end of the preceding
      month; 

     

    (n)
      register all products with correct NDC's and provide this information to the
      Manufacturer. 

     

    5.
      Manufacturer's
      Duties 

     

    5.1
      Manufacturer shall: 

     

    (a)
      ship
      promptly Distributor's orders for Products, FOB Bethlehem, Pennsylvania, USA,
      at
      the prices set forth on Attachment
      A-1
      hereto,
      subject to Section 5.2 hereof; 

     

    (b)
      adequately package and label the Products to conform with any regulatory and
      labeling requirements of the Territory. Product will be co-labeled with
      Manufacturer and Distributor information under Distributor's NDC's;

     

    (c)
      have
      5 US regional sales managers in place upon signing this Agreement; 

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

    
       

    

    (d)
      have
      a minimum of five (5) Hospital Market Field Sales Representatives in place
      within 3 months of signing this Agreement (one in each of the MINRAD defined
      US
      Regions); 

     

    (e)
      add
      three (3) additional professional people to help expand the product line within
      six (6) months of signing this Agreement. 

     

    5.2
      Manufacturer has the right to change the prices for the Products at any time
      during the Term only to the extent of demonstrated increases in its direct
      costs
      of manufacturing the Products; provided, however, that no such price change
      shall be effective without at least sixty (60) days prior notice by Manufacturer
      to Distributor. The price that Distributor pays Manufacturer for the Products
      shall be its lowest price in the Territory for the Human Market with the
      exclusion of those existing accounts referenced in Section 2.5. 

     

    6.
      Trademarks
      and Trade Names 

     

    6.1
      Trademarks and trade names used by Manufacturer and Manufacturer's
      Representative in connection with the Products shall be used by Distributor
      only
      with reference to such Products and only in the manner approved by Manufacturer.
      Distributor acknowledges that it has and will obtain no proprietary interest
      in
      such trademarks and trade names and agrees not to use the same as part of its
      corporate or business name and to discontinue all use thereof immediately upon
      termination of this Agreement. 

     

    6.2
      All
      and any goodwill associated with the trademarks and trade names used by
      Manufacturer and Manufacturer's Representative in connection with the Products
      shall belong to Manufacturer. Distributor shall not do or omit to do any act
      or
      thing likely to affect adversely the goodwill and reputation associated with
      the
      Products and the said trademarks and trade names. 

     

    7.
      Industrial
      Property Rights; Confidentiality

     

    7.1
      All
      technical and commercial information, data regarding processes and know-how
      furnished by Manufacturer and/or Manufacturer's Representative to Distributor
      shall remain the property of Manufacturer and/or Manufacturer's Representative,
      and Distributor shall not acquire any proprietary rights or other interests
      therein. Subject to the limitations listed below, all such information which
      is
      written or is in machine readable (computer) form and which is marked
      "Confidential" or "Proprietary" shall be regarded as confidential information
      of
      Manufacturer and/or Manufacturer's Representative; and any such information
      disclosed orally and as to which Manufacturer and/or Manufacturer's
      Representative shall notify Distributor in writing that it is confidential
      within thirty (30) days after disclosure to Distributor, shall also be
      considered confidential; and in each case, Distributor shall not disclose such
      information to any third party except to the extent such information

     

    (a)
      is
      freely available to the public at the time it is disclosed or made available
      by
      Manufacturer and/or Manufacturer's Representative or subsequently becomes freely
      available to the public otherwise than by default of Distributor or any third
      party who owes an obligation of confidence to Manufacturer and/or Manufacturer's
      Representative or any company within Manufacturer's and/or Manufacturer's
      Representative's group; or 

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

    
       

    

    (b)
      was
      known to Distributor prior to it being disclosed or made available by
      Manufacturer and/or Manufacturer's Representative. 

     

    (c)
      Both
      parties will be bound by the terms of the separate mutually confidential
      agreement signed on May 19, 2004. 

     

    7.2
      If
      during the term of this Agreement, Distributor supplies to Manufacturer and/or
      Manufacturer's Representative any confidential information relating to
      Distributor's business activities, Manufacturer and/or Manufacturer's
      Representative shall be bound by like obligations of confidence to those set
      out
      above in relation to that confidential information. 

     

    8.
      Infringement
      Claims 

     

    Manufacturer
      shall defend at its own expense, any claim by way of suit or proceeding against
      Distributor for the infringement of third party patents or trademarks in respect
      of Products purchased from Manufacturer hereunder, and shall fully indemnify
      Distributor for any direct damages, costs or expenses incurred by Distributor
      in
      respect of any such claim provided that Distributor shall have given
      Manufacturer prompt written notice of any such claim and furnished Manufacturer
      with a copy of each communication relating thereto and give Manufacturer the
      requisite authority to defend or settle such claim. 

     

    9.
      Product
      Warranties 

     

    MANUFACTURER
      WARRANTS THAT THE PRODUCTS WILL CONFORM TO THE MANUFACTURER'S STANDARD WARRANTY,
      IN THE FORM ANNEXED HERETO AS ATTACHMENT B ("WARRANTY"). 

     

    EXCEPT
      FOR THE MANUFACTURER'S WARRANTY, MANUFACTURER MAKES NO REPRESENTATIONS OR
      WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT OR ANY PRODUCTS, INCLUDING, WITHOUT
      LIMITATION, ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR
      PURPOSE, AND MANUFACTURER WILL NOT BE HELD TO ANY LIABILITY WITH RESPECT TO
      ANY
      CLAIM BY DISTRIBUTOR, ITS AFFILIATES, EMPLOYEES OR AGENTS OR ANY THIRD PARTY
      ON
      ACCOUNT OF OR ARISING FROM ANY OF THE PRODUCTS SOLD HEREUNDER OR THEIR USE,
      INCLUDING, BUT NOT LIMITED TO, ANY LIABILITY FOR ANY INCIDENTAL OR CONSEQUENTIAL
      DAMAGES, LOSS OF PROFITS OR GOODWILL. DISTRIBUTOR HEREBY ACKNOWLEDGES THAT
      THE
      ONLY WARRANTY APPLICABLE TO THE PRODUCTS SHALL BE THE MANUFACTURER'S WARRANTY.
      MANUFACTURER SHALL AT ITS SOLE OPTION, ISSUE A CREDIT FOR OR REPLACE, AT NO
      CHARGE TO DISTRIBUTOR, ALL PRODUCTS RETURNED BY DISTRIBUTOR OR RETURNED BY
      CUSTOMERS TO DISTRIBUTOR WHICH DO NOT CONFORM TO THE MANUFACTURER'S WARRANTY.
      

     

    10.
      Insurance
      

     

    Manufacturer
      warrants the product liability insurance for the Products being sold under
      this
      Agreement. 

     

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

     

    11.
      Limitation
      of Liability 

     

    In
      no
      event, except as set forth below, shall Manufacturer be liable to Distributor
      or
      any other entity for any special, consequential, incidental, or indirect damages
      relating to or resulting from manufacturer's failure to perform its obligations
      under this Agreement, however caused, on any theory of liability, and
      notwithstanding any failure of essential purpose of any limited remedy.
      Notwithstanding the limitation of liability set forth above, the Distributor
      will not be liable for any fines incurred solely as a result of Manufacturer's
      failure to promptly ship Distributor's orders for Products pursuant to Section
      5.1(a) to this Agreement. 

     

    12.
      Regulatory
      Matters 

     

    12.1
      Product
      Recall.
      In the
      event Distributor or Manufacturer recalls any of the Products rented or
      distributed by Distributor because such Products are believed to violate any
      provision of applicable law, Manufacturer shall bear all reasonable costs and
      expenses of such recall, including, without limitation, expenses or obligations
      to third parties, the cost of notifying customers and cost associated with
      the
      shipment of recalled Product from customers to Distributor to Manufacturer;
      provided, however, that Distributor shall not unilaterally recall any Product
      supplied by Manufacturer without first obtaining the consent of the
      Manufacturer, which shall not be unreasonably withheld. Distributor shall
      maintain complete and accurate records, for such period as may be required
      by
      applicable law, of all the Products sold, or otherwise distributed, by it.
      The
      parties will cooperate fully with each other in effecting any recall of the
      Products, including communications with any purchasers or users. 

     

    12.2
      Customer
      Complaint Reporting.
      Manufacturer shall be responsible for notifying the appropriate federal, state,
      and local governmental authorities (United States or any country in the
      Territory, as the case may be) of any customer complaints or other occurrences
      regarding the Products which are required to be so reported. Distributor shall
      provide Manufacturer promptly with any information it receives regarding such
      occurrences. 

     

    13.
      Termination

     

    13.1
      Either party shall have the right to terminate this Agreement on written notice
      if the other (i) commits or suffers any act of bankruptcy or insolvency or
      (ii)
      within ninety (90) days after written notice of a material breach of this
      Agreement has been given, either fails to cure any such material breach which
      is
      capable of cure within thirty (30) days or has failed to commence a cure of
      any
      such material breach which is not capable of cure within thirty (30) days.
      

     

    13.2
      Manufacturer shall have the right to terminate this Agreement immediately if
      Distributor shall fail to pay any amount owed by Distributor to Manufacturer
      within ten (10) days after receipt of the notice of non-payment from
      Manufacturer. 

     

    13.3
      This
      Agreement will survive a change in control of either party during the Term.
      

     

    14.
      Effects
      of Termination 

     

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

     

     

    14.1
      Procedures.
      On the
      termination of this Agreement, for whatever reason, (i) Manufacturer shall
      continue to honor Distributor's orders for Products up to the effective date
      of
      termination, (ii) Distributor shall pay all past due invoices and shall pay
      for
      all undamaged, delivered Products in accordance with the terms and conditions
      of
      this Agreement, (iii) Distributor shall return to Manufacturer all promotional
      and all confidential information or other documents relating to the Products
      and
      (iv) Distributor shall cease to use all trademarks and trade names used by
      Manufacturer and Manufacturer's Representative in connection with the Products.
      

     

    14.2
      No
      Compensation.
      Upon
      termination or expiration without renewal of this Agreement, except tender
      offer, Manufacturer shall not be obligated to pay to Distributor any
      compensation, damages or other amount on account thereof, and Distributor freely
      and fully waives any claim it may have to payment of any such amount whether
      under contract, statute or national policy, including Manufacturer's
      indemnification of Distributor. 

     

    15.
      Nature
      of Relationship

     

    Distributor
      is an independent party and shall in no respect be or be deemed to be an
      employee, partner or co-venturer of Manufacturer or an agent of or subject
      to
      the authority of Manufacturer. Except as specifically authorized in writing,
      Distributor shall not be in any way authorized or empowered to bind
      Manufacturer. 

     

    16.
      Severability
      

     

    If
      any
      provision of this Agreement shall be void or unenforceable by reason of any
      applicable law, it shall be deleted and the remaining provisions hereof shall
      continue in full force and effect and, if necessary, so amended as may be
      necessary to give effect to the spirit of this Agreement so far as possible.
      

     

    17.
      Force
      Majeure 

     

    The
      obligations of each party to perform under this Agreement shall be excused
      during each period of delay caused by matters such as strikes, shortages of
      raw
      material, government orders, acts of terror or acts of God, which are reasonably
      beyond the control of the party whose obligation to perform is effected by
      such
      matters and such excuse from performance shall be coextensive with the cause
      of
      such delay. 

     

    18.
      Miscellaneous
      

     

    18.1
      Notices.
      All notices required or permitted shall be in writing and shall be deemed given
      when received personally or by facsimile (when confirmation copy is sent by
      registered airmail, postage prepaid, or by such other method, including air
      courier) addressed as follows, or to such other person or address as may be
      designated by notice given in accordance with this Section to the other party:
      

     

    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

    
      
         

         

      

    

    
      	 	
              If
                to Distributor: 

               

              RxElite
                Holdings Inc. 

              1404
                N. Main, Suite 200 Meridian, Idaho 83642 

              Attn:
                Earl E. Sullivan 

              Fax
                No.: 208-887-1836 

               

              with
                a copy to:

               

              Oles,
                Morrison, Rinker & Baker LLP 

              701
                Pike St., Suite 1700 

              Seattle,
                Washington 98101-3930

               

              Attn:
                Douglas S. Oles

               

              Fax
                No.: 206-682-6234

            	 	
               

              If
                to Manufacturer: 

               

              Minrad
                Inc. 

              847
                Main Street 

              Buffalo,
                New York 14203 

              Attn:
                William H. Burns, Jr. 

              Fax
                No.: 716-855-1078 

               

              with
                a copy to: 

               

              Hodgson
                Russ LLP 

              One
                M&T Plaza, Suite 2000 

              Buffalo,
                New York 14203 

              Attention:
                Robert B. Fleming, Jr. 

              Fax
                No.: 716-849-0349 

               

            

    

     

    18.2
      Entire
      Agreement.
      This
      Agreement is the entire agreement between the parties hereto relating to this
      subject matter, there being no prior written or oral promises or representations
      not incorporated herein. 

     

    18.3
      Applicable
      Law.
      This
      Agreement shall be governed by and construed under the laws of the State of
      New
      York without regard to the principles of conflicts of law. Any claim by
      Distributor against Manufacturer shall be brought within one (1) year after
      Distributor first learns of such claim. Any controversy or claim arising in
      connection with this Agreement shall be finally settled in New York, New York
      under the Rules of the American Arbitration Association by one or more
      arbitrators appointed in accordance with the said Rules and judgment upon the
      award rendered by the arbitrators may be entered in any court having
      jurisdiction thereof. 

     

    18.4
      Amendments.
      No
      amendment or modification of the terms of this Agreement shall be binding on
      either party unless reduced to writing and signed by an authorized officer
      of
      the party to be bound. 

     

    18.5
      Existing
      Obligations.
      Each
      party represents and warrants to the other party that the terms of this
      Agreement do not violate any existing obligations or contracts of such party.
      Each party shall defend, indemnify and hold harmless the other party from and
      against any and all claims, demands, actions or causes of action, which allege
      any such violation. 

     

    18.6
      Assignment.
      This Agreement shall be binding upon and inure to the benefit of the parties
      hereto and their respective successors and assigns, provided, however, that
      neither party shall transfer or assign its interests in this Agreement without
      the prior written consent of the other party. 

     

    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

     

    18.7
      Counterparts.
      For convenience of the parties hereto, this Agreement may be executed in one
      or
      more counterparts, each of which shall be deemed an original for all purposes.
      

     

    18.8
      Board
      Approval-Manufacturer.
      As the
      undersigned President and CEO of Manufacturer requires both the approval and/or
      ratification of this Agreement and the authorization to execute and deliver
      this
      Agreement from Manufacturer's Board of Directors, this Agreement is contingent
      upon and subject to such approval and/or ratification by Manufacturer's Board
      of
      Directors, in its sole discretion, at its next meeting of the Board of
      Directors, which meeting is expected to occur on or about June 9, 2004 and
      which
      approval and/or ratification shall be deemed received unless Manufacturer
      notifies Distributor to the contrary no later than June 16, 2004. 

     

    18.9
      Board
      Approval-Distributor.
      As the
      undersigned President and CEO of Distributor requires both the approval and/or
      ratification of this Agreement and the authorization to execute and deliver
      this
      Agreement from Distributor's Board of Directors, this Agreement is contingent
      upon and subject to such approval and/or ratification by Distributor's Board
      of
      Directors, in its sole discretion, at its next meeting of the Board of Directors
      and which approval and/or ratification shall be deemed received unless
      Distributor notifies Manufacturer to the contrary no later than June 16, 2004.
      

     

    IN
      WITNESS WHEREOF,
      the parties hereto have caused this Agreement to be executed by their authorized
      representatives named below. 

     

    
      	
               

              MINRAD
                INC.

               

            	 	
               

              RXELITE
                HOLDINGS INC.

               

            
	 	 	 	 	 
	
               

              By:

            	
               

              /s/
                William H. Burns, Jr.

            	 	
               

              By:

            	
               

              /s/
                Daniel Chen

            
	 	
              Name:
                William H. Burns, Jr.

            	 	
            	
              Name:
                Daniel Chen

            
	 	
              Title:
                President & CEO

            	 	 	
              Title:
                CEO

            

    

     

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

     

     

    ATTACHMENT
      A

     

     

    PRODUCTS

     

    
      	
               

              1.
                

               

            	
               

              Human
                Inhalation Anesthetic agents Terrell Isoflurane USP, Compound 347
                Enflurane USP (Non-Private Label Distributor) and Sevoflurane (when
                and if
                available) 

               

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    ATTACHMENT
      A-1

     

    Annual
      Purchase Commitments 

     

    Territory:
      United States Human Market

    
      

        
          	
                   

                	 	
                   

                	 	
                   Initial 

                	
                   

                	
                  Annual
                    

                	
                   

                
	
                   Product 

                	
                   

                	
                   Price
                    Per Bottle 

                	
                   

                	
                   Stocking
                    Order 

                	
                   

                	
                   Commitment* 

                	 
	
                   

                	 	
                   

                	 	
                   

                	 	
                   

                	 
	
                   Compound
                    347TM Enflurane USP  250
                    ml bottle 

                	 	
                  $

                	
                  *

                	 	 	
                  *

                	 	 	
                  *

                	 
	
                   TerrellTM
                    lsoflurane USP  100
                    ml bottle 

                	 	
                  $

                	
                  *

                	 	 	
                  *

                	 	 	
                  [Initial
                    Stock Order Only

                	
                  ]

                
	
                   TerrellTM
                    Isoflurane USP  250
                    ml bottle 

                	 	
                  $

                	
                  *

                	 	 	
                  *

                	 	 	
                  *

                	 
	
                   Sevoflurane
                    250 ml bottle 

                	 	
                  $

                	
                  *

                	 	 	
                  *

                	 	 	
                  *
                    **

                	 

        

      

    

     

    Prices
      are FOB Bethlehem, Pennsylvania, USA. 

     

    Terms:
      *
      net * 

     

    *
      Shipments will be made monthly in lot-size multiples. Purchases will be measured
      in 250ml equivalents but will not be limited to the percentage allocations
      listed above. For example: Distributor purchases 5 -100mL units will equal
      2 -
      250mL unit equivalents and decrement from the total commitment of ml to be
      purchased as outlined in Attachment A-1 

     

    **
      When
      and if available and increasing to * bottles and * bottles in the second and
      third years, respectively, during the Initial Term and * during each Renewal
      Term. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    ATTACHMENT
      A-2

     

    TERRITORY:

     

    
      United
        States (being the contiguous 48 states, Alaska and Hawaii)

       

      Human
        Market

       

      (Non-OEM)

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    ATTACHMENT
      B

     

    LIMITED
      WARRANTY AND LIMITATION OF LIABILITY

     

    WARRANTY

     

    Manufacturer
      warrants and guarantees that, when delivered to distributor FOB Bethlehem,
      Pennsylvania, the Product shall conform to the Registered Specifications, shall
      not be adulterated or misbranded within the meaning of the Act and shall conform
      to all applicable regulations of the FDA (The "Limited Warranty"). EXCEPT FOR
      THE LIMITED WARRANTY, MANUFACTURER MAKES NO REPRESENTATIONS OR WARRANTIES OF
      ANY
      KIND REGARDING THE PRODUCTS, EXPRESS, IMPLIED OR OTHERWISE, AND SPECIFICALLY
      DISCLAIMS: ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
      PURPOSE. 

     

    THIS
      WARRANTY IS IN LIEU OF ALL OTHER WARRANTIES (EXCEPT OF TITLE), EXPRESSED,
      IMPLIED, OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY OR OF FITNESS
      FOR A PARTICULAR PURPOSE. 

     

    THE
      REMEDIES OF THE USER IN THE WARRANTY SET FORTH ABOVE ARE EXCLUSIVE, AND THE
      TOTAL LIABILITY OF MINRAD AND/OR ANY MINRAD DISTRIBUTOR WITH RESPECT TO PRODUCT
      SOLD TO THE USER, IN CONNECTION WITH THE PERFORMANCE THEREOF, OR ARISING OUT
      OF
      THE SALE, DELIVERY, INSTALLATION OR REPAIR OF ANY MINRAD PRODUCT WHETHER BASED
      ON CONTRACT, WARRANTY, NEGLIGENCE, INDEMNITY, STRICT LIABILITY, OR OTHERWISE,
      SHALL NOT EXCEED THE PURCHASE PRICE OF THE DRTSÔ PLATFORM UPON WHICH SUCH
      LIABILITY IS PLACED. 

     

     

    MINRAD
      AND ITS DISTRIBUTORS SHALL IN NO EVENT BE LIABLE TO THE USER, OR TO ANY
      SUCCESSOR IN INTEREST OR ANY BENEFICIARY OR ASSIGNEE THEREOF, ON ACCOUNT OF
      ANY
      MINRAD PRODUCT FOR ANY CONSEQUENTIAL, INCIDENTAL, INDIRECT, SPECIAL OR PUNITIVE
      DAMAGES ARISING OUT OF THE SALE, DELIVERY, INSTALLATION OR REPAIR OF SUCH
      PRODUCT, OR ANY DEFECTS IN, OR FAILURE OF, OR MALFUNCTION OF THE PRODUCT
      INCLUDING, BUT NOT LIMITED TO, DAMAGES BASED UPON LOSS OF USE, LOST PROFITS
      OR
      REVENUE, INTEREST, LOST GOODWILL, INCREASED EXPENSES AND/OR CLAIMS OF CUSTOMERS
      OF THE USER, WHETHER OR NOT SUCH LOSS OR DAMAGE IS BASED ON CONTRACT, WARRANTY,
      NEGLIGENCE, INDEMNITY, STRICT LIABILITY OR OTHERWISE. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    ADDENDUM
      TO DISTRIBUTION AGREEMENT

     

    THIS
      ADDENDUM TO DISTRIBUTION AGREEMENT (this "Addendum") is made as of March 28,2005
      (the "Addendum Effective Date"), by and between MINRAD INC., with offices at
      847
      Main Street, Buffalo, New York 14203 ("Manufacturer") and RxElite
      Holdings Inc.,
      a
      Delaware corporation with offices at 1404 N. Main, Suite 200, Meridian, Idaho
      83642 ("Distributor"). 

     

    WHEREAS,
      Manufacturer and Distributor entered into a Distribution Agreement, effective
      June 9, 2004 (the "Agreement"), regarding the distribution by Distributor of
      certain of Manufacturer's products and related accessories; and 

     

    WHEREAS,
      Manufacturer and Distributor desire to amend the Agreement to include certain
      other products and related accessories in addition to those originally covered
      within the scope of the Agreement. 

     

    NOW,
      THEREFORE, Manufacturer and Distributor agree as follows: 

     

    1.
      Section 2.1 is amended by adding the follow sentence: 

     

    Notwithstanding
      anything herein to the contrary, Manufacturer and Distributor also acknowledge
      Manufacturer's right to sell, from time to time, Enflurane to Abbott, who
      bottles and markets the Products under its own name for the purpose of selling
      the Products to end-use customers in the human market in the Territory (the
      "Private Label Distributor"). 

     

    2.
      Section 5.1 (c) is replaced with: 

     

    (c)
      have
      5 US regional sales managers in place by June 30, 2005; 

     

    3.
      Section 5.1 (d) is replaced with: 

     

    (d)
      have
      a minimum of five (5) Hospital Market Field Sales Representatives in place
      by
      June 30, 2005 (one in each of the MINRAD defined US Regions); 

     

    4.
      Attachment A of the Agreement is amended by adding the following products and
      market: 

     

    a.
      Manufacturer hereby grants to Distributor for the Term the non-exclusive right
      to purchase MINRAD AttaneTM
      branded
      product from Manufacturer for the sole purpose of selling the Products to
      end-use customers in the veterinary market in the Territory, and Distributor
      accepts such grant, subject to the limitations, terms and conditions stated
      in
      this Agreement. The Distributor will not sell MINRAD Attane TM
      branded
      product to veterinary distributors. Manufacturer will turn over its existing
      end-user veterinary customers to the Distributor. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    b.
      Manufacturer hereby grants to Distributor for the Term the exclusive right
      to
      purchase Desflurane from Manufacturer for the sole purpose of selling the
      Products to end-use customers in the human market in the Territory, and
      Distributor accepts such grant, subject to the limitations, terms and conditions
      stated in this Agreement. 

     

    2.
      Attachment A-1 of the Agreement is amended by adding the following initial
      order, minimum order, pricing and annual order requirements: 

     

    a.
      Veterinary Products 

    

      
        	
                 Product 

              	 	
                 Price
                  per  bottle 

              	
                 

              	
                 Initial
                  Stocking Order 

              	
                 

              	
                 Minimum
                  Order 

              	 
	
                 AttaneTM
                  Isoflurane USP  100
                  ml bottle  

              	 	
                $

              	
                *

              	 	 	
                *

              	 	 	
                *

              	 
	
                 AttaneTM
                  Isoflurane USP  250
                  ml bottle 

              	 	
                $

              	
                *

              	 	 	
                *

              	 	 	
                *

              	 
	
                 SustaneTM
                  Sevoflurane 250 ml bottle 

              	 	
                $

              	
                *

              	 	 	
                *

              	 	 	
                *
                  *

              	 

      

    

     

    b.
      Desflurane (when available) 

    

      
        	
                 Product 

              	 	
                 Price
                  per  bottle 

              	
                 

              	
                 Initial
                  Stocking Order 

              	
                 

              	
                 Annual
                  Commitment 

              	 
	
                 Desflurane
                  USP 250 ml bottle 

              	 	
                $

              	
                *

              	 	 	
                *

              	 	 	
                *
                  *

              	 

      

    

     

    *
      When
      available - pricing and annual commitments to be re-evaluated when product
      is
      nearing availability. 

     

    4.
      Manufacturer will provide Distributor at no charge "Free Goods", *
      TerrellTM
      100 ml
      bottles and * Compound 347TM
      250 ml
      bottles for sale or distribution in the Territory. These Free Goods are to
      compensate Distributor for any pricing issues in the Territory through the
      life
      of the agreement. 

     

    5.
      Except
      as modified by this Addendum, the Agreement is hereby ratified and will remain
      in full force and effect in accordance with its terms. 

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, the parties have executed this Addendum as of the date first
      above written. 

     

    
      	
              MINRAD
                INC.

            	 	
              RXELITE
                HOLDINGS INC.

            
	 	 	 	 	 
	
               

              By:

            	/s/
              William H. Burns, Jr. 	 	
               

              By:

            	/s/
              Daniel Chen 
	 	
              Name:
                William H. Burns, Jr.

            	 	 	
              Name:
                Daniel Chen

            
	 	
              Title:
                President & CEO

               

            	 	 	
              Title:
                CEO

               

            

    

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

     

    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.

     

    AMENDMENT
      NO. 2 TO 

     

    EXCLUSIVE
      MANUFACTURING AND DISTRIBUTION AGREEMENT 

     

    RxElite
      Holdings Inc.("Distributor")
      and MINRAD,
      INC.("Manufacturer")
      hereby agree as follows: 

     

    1.
      Reference is made to a certain Exclusive Manufacturing and Distribution
      Agreement, between Distributor and Manufacturer dated on or about June 9, 2004,
      as amended by an Addendum to Distribution Agreement dated on or about March
      28,
      2005 (as amended, the "Distribution
      Agreement").
      Any
      specially capitalized terms used in this Amendment No. 2 shall have the same
      defined meanings as provided for in the Distribution Agreement. 

     

    2.
      Reference is made to two purchase orders by Distributor to purchase Sevoflurane
      in bulk drums, the first of which shall be referred to herein as the
      "Initial
      Sevo Order",
      and
      the second of which as the "Second
      Sevo Order"
      (and
      collectively as the "Orders").
      The
      Orders shall be subject to the Distribution Agreement as hereby further amended.
      The Initial Sevo Order will be delivered in 2 (two) parts; the first part being
      delivered in June 2006 and consisting of the equivalent of XX250ml
      bottles of Sevoflurane and the second part being delivered in September 2006
      and
      consisting of the equivalent of XX250ml
      bottles of Sevoflurane. The Second Sevo Order will be delivered in
      November/December 2006 and will consist of the equivalent of XX
      250ml
      bottles of Sevoflurane. The bottles shall have an expiration dating of 2 (two)
      years when bottled. 

     

    3.
      The
      Distribution Agreement is hereby further amended as follows: 

     

    A.
      Section 2.3 and Section 4(b) of the Distribution Agreement are hereby amended
      to
      provide that (i) for the Initial Sevo Order, the terms of payment are
XX%
      XX
      days,
      net XX
      days;
      and (ii) for the Second Sevo Order and for all product orders under the
      Distribution Agreement after the date hereof, the terms of payment will be
      XX%
      XX
      days,
      net XX
      days.

     

    B.
      For
      clarification, in addition to the RxElite trademark, Distributor will use
      Manufacturer's MINRAD® and SojournTM trademarks in connection with the resale of
      Sevoflurane to the market. This shall be done in a similar manner to the
      Distributor's Isoflurane and Enflurane labels. 

     

    C.
      Section 3.1 of the Distribution Agreement is hereby amended to provide that
      the
      Distributor must purchase a minimum XX%
      of the
      annual minimum commitment.

     

    D.
      Section 4(1) of the Distribution Agreement is hereby amended to read in its
      entirety as follows: 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    "(l)
      Distributor shall have hired a minimum of four (4) Regional sales managers
      within thirty (30) days of signing this agreement. Distributor shall have hired
      a minimum of twenty-four (24) hospital market sales representatives within
      eighty (180) days after US FDA Sevoflurane approval and will use its reasonable
      commercial efforts to do so within 90 days after such approval;" 

     

    E.
      The
      price
      for Sevoflurane provided for in Attachment
      A-I to
      the
      Agreement is changed from $XX
      per
      bottle to $XX
      per
      bottle (the "Base Price") for all orders after and excluding the Initial Sevo
      Order (60,000 bottles), which Base Price shall remain in effect until June
      30,
      2007 (regardless of when the FDA approval for Sevoflurane is received by
      Manufacturer). 

     

    F.
      Section
      5.2 of the Distribution Agreement is amended to provide that for sales of
      Sevoflurane after June 30, 2007, the Base Price will be adjusted, up or down,
      on
      an annual basis (with the contract year, for this purpose running from July
      1 to
      June
      30) to reflect changes in Manufacturer's total costs of producing Sevoflurane
      (using May 31, 2006 as the baseline date for comparing Manufacturer's costs)
      including but not limited to (a) raw materials and other product components
      and
      (b) Manufacturer's standard production costs as already used internally by
      Minrad management; provided, however, that no reduction of the Base Price shall
      be effective until Manufacturer has received the economic benefit from cost
      reductions of $XX
      in total
      costs of producing Sevoflurane (to cover certain cost increases absorbed by
      Manufacturer for Sevoflurane). The Manufacturer shall provide Distributor with
      such information and documentation as it may reasonably request to evidence
      and
      support any changes to the Base Price provided for hereunder including sharing
      the Manufacturer's internal standard production costs used in calculating
      management compensation at the Manufacturer. The parties shall meet (in person
      or by conference call) prior to the beginning of each contract year (starting
      immediately prior to July 1, 2007) to review any changes in costs that may
      trigger a price change contemplated hereunder. 

     

    G.
      The
      parties agree that the Distributor's Annual Commitments to purchase Isoflurane
      and Enflurane for years 2006 and 2007 only that are set forth in Attachment
      A-I to
      the
      Distribution Agreement, are reduced to XX.
      

     

    H.
      Section
      18.6 of the Distribution Agreement is hereby amended to read in its entirety
      as
      follows: 

     

    "18.6
      Assignment;
      Change of Control.
      Neither
      this Agreement, nor any interest therein, nor any of the rights and obligations
      of either party hereunder, may be directly or indirectly assigned, sold,
      delegated, or otherwise disposed of by either party, in whole or in part,
      without the prior written consent of the other party, which will not be
      unreasonably withheld. For the purposes of this Section, in the ease of the
      Distributor, an
      "assignment" shall be deemed to have occurred upon (a) a change of control
      resulting from a single transaction or series of related transactions, or (b)
      a
      restructuring of the Distributor, or transfer or removal of a material amount
      of
      assets from the Distributor, or assumption of debt by the Distributor such
      that
      as a result of such restructuring, transfer, removal or assumption, the
      Distributor possesses a net worth materially less than that of the Distributor
      on the effective date of this Agreement. In addition, for clarification, (a)
      a
      "change of control" will occur if any person, company, or other entity acquire
      beneficial ownership of 80% or more of Distributor's capital stock or the
      executive management of Distributor is materially changed in connection with
      any
      ownership change affecting Distributor; and (b) if a change in control occurs
      in
      which a competitor of Manufacturer (wherever located) acquires an ownership
      or
      management position in Distribution, Manufacturer can withhold its consent
      and
      terminate the New Agreement." A competitor shall be defined as a manufacturer
      or
      distributor of anesthetic products or products that compete with other products
      produced by Manufacturer. 
       

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
    

     

    4.
      Except
      as
      provided for in this Amendment No. 2, the Distribution Agreement shall remain
      in
      full force and effect. 

     

    This
      Amendment No. 2 has been executed below by the duly authorized representatives
      of the Distributor and the Manufacturer. 

     

    
      	 	
              RxELITE
                HOLDINGS INC. 

               

               

            	 	 	MINRAD,
              INC.
	By:	/s/ Jonathan Houssian 	 	 	/s/
              William H.
              Burns, Jr., CEO 
	 	
              
Title:
              President	 	 	
              
William
              H. Burns, Jr., CEO
	 	Date: June
              14, 2006	 	 	Date: June
              14, 2006THE
        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.

    

     

    
      
        
        

      

      
        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,

    

     

    
      
        
        

      

      
        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);

         

      

    

    

     

    
      
        
        

      

      
        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, 

                

        

         

        
          

           

        

        
          
            
            

          

          
            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. 

     

    

     

    
      
        
        

      

      
        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:

       

      

       

      
        
          
          

        

        
          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.

           

          

           

          
            
              
              

            

            
              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:

             

            

             

            
              
                
                

              

              
                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.

     

    

    
      
        
        

      

      
        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.

     

    

    

    
      
        
        

      

      
        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").

     

    

     

    
      
        
        

      

      
        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;

     

    

     

    
      
        
        

      

      
        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.

     

    

     

    
      
        
        

      

      
        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.

     

    

     

    
      
        
        

      

      
        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.

     

    

     

    
      
        
        

      

      
        Page
          15
          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.

    

     

    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.

     

    

     

    
      
        
        

      

      
        Page
          16
          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.

    

     

    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.

     

    

     

    
      
        
        

      

      
        Page
          17 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
      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).

     

     

    

    
      
        
        

      

      
        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.

     

    

     

    
      
        
        

      

      
        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.

     

    

     

    
      
        
        

      

      
        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.

     

    

     

    
      
        
        

      

      
        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.

     

    

     

    
      
        
        

      

      
        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.

     

    

     

    
      
        
        

      

      
        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.

      

       

      
        
          
          

        

        
          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
      

     

    

     

    
      
        
        

      

      
        
          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.

     

    

     

    
      
        
        

      

      
        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:

     

    
      	 	 	 	 
		 	 	11/07/2006
	
              
                

              

              Kirti H. Valia, Ph.D. 

              President
                and CEO 

              Core
                Tech Solutions, Inc.

            	 	 	Date
	 	 	 	 
	EIN:
              22-3588695	 	 	 
	 	 	 	 
	DNB: 06-843-1860	 	 	 
	 	 	 	 
	 	 	 	 
	Accepted:	 	 	 
	 	 	 	 
	 	 	 	11-9-2006
	
              
                

              

              Jonathan Houssian 

              President

              RxElite,
                Inc. 

            	 	 	
              Date

            
	 	 	 	 
	
              EIN:

              
                

              

            	 	 	 
	 	 	 	 
	
              DNB: 

              
                

              

            	 	 	 

    

     

    

     

    
      
        
        

      

      
        
          Page
            27
            of 27

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