Exhibit 10.5

 

CERTAIN MATERIAL (INDICATED BY [***]) HAS BEEN OMITTED FROM THIS DOCUMENT
PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT.  THE OMITTED MATERIAL HAS BEEN
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

 

SUPPLY AGREEMENT

 

THIS SUPPLY AGREEMENT (this “Agreement”) is made as of April 2, 2015 (the
“Effective Date”), by and between Noramco, Inc., a Georgia corporation, with
offices at [***] (“Noramco”) and Depomed, Inc., a California corporation located
at 7999 Gateway Boulevard, Suite 300, Newark, California 94560 (hereinafter
referred to as “Purchaser”).  Noramco and Purchaser may be referred to herein as
a “Party” or “Parties” as the context may require.

 

RECITALS

 

WHEREAS, Noramco is engaged in the business of manufacturing and selling active
pharmaceutical ingredients, including tapentadol (“API”);

 

WHEREAS, Janssen Pharmaceuticals, Inc. (“Seller”), an Affiliate of Noramco, and
Purchaser are parties to that certain Asset Purchase Agreement, dated as of
January 15, 2015 (the “Asset Purchase Agreement”), pursuant to which Seller
agreed to sell, and Purchaser agreed to purchase, certain rights and assets
related to the products containing API set forth on Appendix A (the “Products”),
and Purchaser agreed to assume certain liabilities related to the Products, in
the United States (the “Transaction”);

 

WHEREAS, prior to the Effective Date, Noramco manufactured and supplied API to
Seller and its Affiliates for use in the commercial manufacture of Products for
distribution in the United States;

 

WHEREAS, pursuant to Section 6.07 of the Asset Purchase Agreement, Purchaser and
Seller (or its Affiliate) agreed to enter into an API supply agreement pursuant
to which, following the closing of the Transaction, Seller or its Affiliate
would manufacture and supply Purchaser’s requirements of API for use in (i) the
validation and qualification of Purchaser’s facility for the manufacture of
Products and (ii) following the validation and qualification of Purchaser’s
facility, the manufacture of Purchaser’s requirements of finished Products for
distribution in the United States, on the terms set forth in Exhibit D to the
Asset Purchase Agreement; and

 

WHEREAS, Purchaser wishes to purchase API, and Noramco is willing to supply API
to Purchaser, on the terms and conditions of this Agreement.

 

NOW THEREFORE, INTENDING TO BE LEGALLY BOUND HEREBY AND IN CONSIDERATION OF THE
MUTUAL REPRESENTATIONS, WARRANTIES AND COVENANTS SET FORTH IN THIS AGREEMENT AND
OTHER GOOD AND VALUABLE CONSIDERATION THE RECEIPT AND SUFFICIENCY OF WHICH IS
HEREBY ACKNOWLEDGED, THE PARTIES AGREE AS FOLLOWS:

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

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

 

DEFINITIONS

 

For purposes of this Agreement, the following words or expressions have the
meanings provided below:

 

“AAA” shall have the meaning set forth in Section 19.1.

 

“AAA Rules” shall have the meaning set forth in Section 19.2.

 

“Action” shall have the meaning set forth in Section 10.1.

 

“Affiliate” means, with respect to any Person, any other Person directly or
indirectly controlling, controlled by, or under common control with, such Person
at any time during the period for which the determination of affiliation is
being made.  For purposes of this definition, “control” of a Person means the
power, direct or indirect, to direct or cause the direction of the management
and policies of such Person whether by contract or otherwise and, in any event
and, without limitation of the previous sentence, any Person owning more than
fifty percent (50%) or more of the voting securities of another Person shall be
deemed to control that Person.

 

“Agreement” shall have the meaning set forth in the preamble to this Agreement.

 

“API” shall have the meaning set forth in the Recitals.

 

“API Manufacturing Patents” mean United States Patent No. [***] and United
States Patent No. [***].

 

“Asset Purchase Agreement” shall have the meaning set forth in the Recitals.

 

“Breaching Party” shall have the meaning set forth in Section 13.2.

 

“cGMP” means current good manufacturing practices as required by the rules and
regulations of the FDA, as applicable to the manufacturing, packaging, handling,
storage and control of API.

 

“Commercial Use” shall have the meaning set forth in Section 1.3.

 

“Confidential Information” shall have the meaning set forth in Section 11.5.

 

“DEA” means the Drug Enforcement Administration of the US Department of Justice
or any successor organization.

 

“Dispute” shall have the meaning set forth in Section 19.1.

 

“DMF” means the Drug Master File as filed with the FDA by Noramco or its
Affiliates.

 

“Effective Date” shall have the meaning set forth in the preamble to this
Agreement.

 

“FDA” means the United States Food and Drug Administration or any successor
organization.

 

“Finished Good Tapentadol” means the amount of API contained in the finished
Product, as calculated in the manner set forth on Appendix D, manufactured at a
Seller facility (using the standard

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

2

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

 

manufacturing practices at such Seller facility) and sold to Purchaser under the
Transitional Supply Agreement for Commercial Use only in the United States.

 

“Force Majeure Events” shall have the meaning set forth in Section 16.1.

 

“Forecast” shall have the meaning set forth in Section 3.1.

 

“Indemnified Party” shall have the meaning set forth in Section 10.3.

 

“Indemnifying Party” shall have the meaning set forth in Section 10.3.

 

“Infringement Claim” has the meaning set forth in Section 12.2.

 

“Initial Price Term” shall mean the term commencing on the Effective Date and
ending on [***].

 

“Initial Term” shall have the meaning set forth in Section 13.1.

 

“J&J Calendar Year” shall mean a calendar year based on the Johnson & Johnson
Universal Calendar.

 

“Losses” shall have the meaning set forth in Section 10.1.

 

“Manufacturing Interruptions” shall have the meaning set forth in Section 8.1.

 

“Manufacturing Quota” means the amount of an API allotted to Noramco by the DEA
pursuant to applicable DEA regulations so that Noramco may manufacture API.

 

“Manufacturing Quota Restrictions” shall have the meaning set forth in
Section 8.2.

 

“Non-Commercial Use” shall have the meaning set forth in Section 1.1.

 

“Nonconforming API” shall have the meaning set forth in Section 6.1.

 

“Noramco” shall have the meaning set forth in the preamble to this Agreement.

 

“Noramco Indemnitee” shall have the meaning set forth in Section 10.1.

 

“Party/Parties” shall have the meaning set forth in the preamble to this
Agreement.

 

“Person” means an individual, a limited liability company, a joint venture, a
corporation, a partnership, an association, a trust, a division, unincorporated
organization, or an operating group of any of the foregoing or any other entity
or organization, whether governmental or otherwise.

 

“Post-Transfer Supply Agreement” shall have the meaning set forth in the Asset
Purchase Agreement.

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

3

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

 

“Procurement Quota” means the quota allotted to Purchaser by the DEA pursuant to
applicable DEA regulations so as to permit shipment of API from Noramco to
Purchaser.

 

“Procurement Quota Restrictions” shall have the meaning set forth in
Section 8.3.

 

“Products” shall have the meaning set forth in the Recitals.

 

“Purchase Order” shall have the meaning set forth in Section 3.3.

 

“Purchaser” shall have the meaning set forth in the preamble to this Agreement.

 

“Purchaser Indemnitee” shall have the meaning set forth in Section 10.2.

 

“Purchaser’s Facility” means the manufacturing facility of Purchaser (or its
designee).

 

“Quality Agreement” means the agreement related to quality assurance and control
entered into between Purchaser and Seller as of the date hereof.

 

“Regulatory Authority” means any and all governmental bodies and organizations
regulating the manufacture, importation, distribution, use and/or sale of a
Product.

 

“Renewal Term” shall have the meaning set forth in Section 13.1.

 

“Seller” shall have the meaning set forth in the Recitals.

 

“Specification(s)” means the API specification(s) contained in Appendix B,
except as may be agreed in writing by Purchaser and Noramco as an amendment to
this Agreement.

 

“Supply Price” shall have the meaning set forth in Section 4.1.

 

“Term” shall have the meaning set forth in Section 13.1.

 

“Transaction” shall have the meaning set forth in the Recitals.

 

“Transition Period” means the period beginning on the Effective Date and ending
on the date that Purchaser commences the manufacture of any Product for
Commercial Use at Purchaser’s Facility for distribution in the United States.

 

1.                                      SUPPLY

 

1.1.                            Subject to the terms and conditions of this
Agreement, during the first [***] of the Term, Noramco shall supply to
Purchaser, and Purchaser shall purchase from Noramco, [***] of Purchaser’s
requirements of API and thereafter, Noramco shall supply to Purchaser, and
Purchaser shall purchase from Noramco, [***] of Purchaser’s requirements of API;
provided however, that beginning the first full J&J Calendar Year after the
Transition Period, Purchaser shall purchase from Noramco a minimum annual volume
of [***] of API during the Term,

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

4

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

 

subject to availability of Manufacturing Quota and Procurement Quota.  The
calculation of the minimum annual volume of API shall include the Finished Good
Tapentadol as calculated in accordance with Appendix D.  [***].

 

1.2.                            During the Transition Period, such API is for
use in the qualification and validation of Purchaser’s facility for the
manufacture of Products, clinical and non-clinical development of Products, or
analytical testing or analytical development of Products (such use
“Non-Commercial Use”).  Purchaser shall not use any API supplied by Noramco
during the Transition Period for any purpose other than Non-Commercial Use
without Noramco’s prior written consent.

 

1.3.                            After the Transition Period, such API is for use
in the manufacture of Products for commercial distribution in the United States
(such use “Commercial Use”).  Purchaser shall not use any API supplied by
Noramco for any purpose other than Commercial Use or Non-Commercial Use without
Noramco’s prior written consent.

 

1.4.                            Noramco shall use [***] efforts to supply
Purchaser with API in the quantities and on the date(s) specified in each
Purchaser purchase order. Noramco will use [***] efforts to supply Purchaser
with impurity reference standards related to API at a [***] cost, with such
impurity reference standards to be used only to support Purchaser’s analytical
testing.

 

1.5.                            Purchaser will keep accurate records of its
requirements of API during the Term, and, upon the request of Noramco, will
permit Noramco or its duly authorized agents to examine such records during
normal business hours for the purpose of verifying the correctness of all
calculations in such records.

 

2.                                      PERMITS; DMF(S) AND cGMP

 

2.1.                            Noramco will be responsible for obtaining [***]
any licenses or permits, and any regulatory and government approvals necessary
for the manufacture of API, provided that Manufacturing Quota is addressed in
Article 8 below.

 

2.2.                            Noramco [***] has filed or will file and shall
maintain a valid DMF covering the API during the Term, all in accordance with
all applicable laws, rules and regulations of the FDA or any other Regulatory
Authority.

 

2.3.                            Noramco shall provide Purchaser with an access
or right of reference letter entitling Purchaser to make continuing reference to
the Noramco DMFs in connection with any regulatory filings made with the FDA by
Purchaser with respect to Product.

 

2.4.                            Noramco shall provide a certificate of analysis
with each shipment of API delivered hereunder.  All API sold to Purchaser under
this Agreement will be manufactured in accordance with cGMP and conform to the
Specifications.

 

2.5.                            A Party that desires a change in filed
Specifications shall provide the other Party with its written request therefore,
in a timely manner, and in no case, later than [***] before the Product made
using the changed filed Specifications is delivered.  Requested changes shall be

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

5

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

 

implemented only if and after the other Party consents to them, which consent
shall not be unreasonably withheld.  The Party requesting a change in filed
Specifications shall bear the financial costs of implementing such change.

 

3.                                      FORECASTS AND PURCHASE ORDERS FOR API

 

3.1.                            On [***] throughout the Term, Purchaser shall
provide to Noramco a [***] rolling ([***]), binding (except as set forth below)
forecast (each a “Forecast”) of the anticipated monthly purchases of API under
this Agreement, provided that the initial Forecast shall be provided to Noramco
no later than [***] after the Effective Date.  The Forecast will include
quantities for planned regulatory filings.  The [***] Forecast shall be binding
on Purchaser and shall constitute a firm commitment by Purchaser to issue a
purchase order for the API indicated for such months, subject to availability of
Manufacturing Quota and Procurement Quota, provided, however, that if necessary
in light of significant changes in the market for the Products due to
availability of a generic equivalent of the Products, regulatory actions or
other developments materially and adversely affecting the market for the
Products, the Parties will discuss in good faith and mutually agree upon a
commercially reasonable reduction to such forecasts.  With respect to any
Forecast submitted by Purchaser hereunder, Purchaser may request an increase of
no greater than [***] in the quantity of API forecast [***] and Noramco shall
take [***] efforts to accommodate such request.

 

3.2.                            With respect to each Forecast (and any increase
to such Forecast), [***].

 

3.3.                            Purchaser shall place monthly purchase orders
for API with Noramco, each of which shall specify quantities in kilograms and a
delivery date that is not less than [***], nor more than [***], from the date of
Noramco’s receipt of such purchase order (each, a “Purchase Order”).  Subject to
this Section 3.3 and Article 8, Noramco shall supply and deliver such quantities
of API to Purchaser as set forth in each Purchase Order, provided that, unless
Noramco otherwise agrees in its sole discretion, each Purchase Order shall be
consistent with the quantities set forth in the applicable Forecast provided in
accordance with Section 3.1 and the delivery date restrictions set forth in this
Section 3.3.  Each Purchase Order must be submitted with a certificate of
available Procurement Quota or a completed DEA Form 222 which evidences that
Purchaser shall be able to take delivery of the API subject to the Purchase
Order; provided, however, that Noramco, in its sole discretion, may agree to
accept a Purchase Order which specifies the amounts of API that are contingent
upon future receipt of Procurement Quota.  In the event that Noramco accepts any
Purchase Order which specifies that all or a portion of API is contingent upon
receipt of Procurement Quota, the supply and purchase thereof shall be subject
to Article 8.

 

4.                                      CONSIDERATION FOR SUPPLY OF API

 

4.1.                            The price of API to be sold to Purchaser during
the Initial Price Term shall be based on the annual volume of API ordered by
Purchaser as set forth on Appendix C (the “Supply Price”).  For the avoidance of
doubt [***].

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

6

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

 

4.2.                            After the Initial Price Term, a reasonable
increase in the Supply Price shall be mutually agreed upon by the Parties
[***].  In the event a mutual agreement is not reached on the price increase,
the Supply Price shall be [***].

 

4.3.                            In addition to the foregoing, at any time during
the Term, Noramco shall be entitled to adjust the Supply Price in the event of
increases to the cost of raw materials or fees of third party contractors
incurred by Noramco as compared with such costs on the Effective Date; provided,
however, that such adjustments to the Supply Price shall not take effect until
Noramco and Purchaser discuss such adjustments in good faith.  Such Supply Price
increases shall be applicable to any and all orders placed more than [***] after
Noramco has notified Purchaser of the increase in writing.  Purchaser shall be
entitled to request that an independent certified accountant verifies the
accuracy of any such Supply Price increases.

 

4.4.                            Purchaser shall pay Noramco for all supplied
quantities of API within [***] from the date of invoice, provided that, pending
resolution of any disagreement under Article 6, Purchaser is not obligated for
any payment payable with respect to API for which Purchaser has delivered a
written objection pursuant to Article 6.

 

4.5.                            All payments payable for the purchase of API
will be made by electronic transfer of United States Dollars to an account
designated in writing by Noramco.

 

4.6.                            Noramco will not be obligated to honor orders or
shipments to Purchaser should Purchaser’s account with Noramco fall greater than
[***] in arrears.

 

4.7.                            In addition to the Supply Price for quantities
of API delivered hereunder, Purchaser shall pay Noramco any and all governmental
taxes, charges or duties of every kind (excluding any tax based upon Noramco’s
net income) that Noramco may be required to collect or pay upon sale, transfer
or shipment of API to Purchaser.

 

5.                                      SHIPMENT OF API

 

5.1.                            Noramco shall make deliveries of API to
Purchaser or its designate [***].  Each shipment of API delivered to Purchaser
hereunder shall be accompanied by an invoice for the quantity of API included in
such shipment.

 

5.2.                            In the event that a Purchase Order is delivered
where delivery of any API thereunder is contingent upon Purchaser securing
Procurement Quota, Noramco may require cash or satisfactory security prior to
accepting such Purchase Order or shipments or deliveries of API hereunder.  The
election by Noramco to require such cash or security shall not affect the
obligation of Purchaser to take and pay for the ordered API.  Purchaser shall
pay all costs and expenses, including reasonable attorneys’ fees, incurred by
Noramco in the collection of any sum payable by Purchaser to Noramco under this
Agreement.  Noramco shall be entitled to interest on any overdue sum at the
maximum rate allowed by applicable law.

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

7

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

 

6.                                      INSPECTION AND REJECTION

 

6.1.                            All API delivered to Purchaser hereunder may be
inspected by Purchaser and rejected if the API does not meet the Specifications
or has not been manufactured in accordance with cGMP(s) (any such API,
“Nonconforming API”).  API will be deemed accepted if Noramco does not receive a
written notice from Purchaser setting forth in reasonable detail the claimed
visible nonconformity within [***] after delivery to Purchaser of such API or
the claimed non-visible nonconformity within [***] after Purchaser’s discovery
of such non-visible nonconformity, provided, however, in no event shall any API
be rejected based on nonconformity less than [***] prior to its expiration date.

 

6.2.                            Upon receipt of a written notice that any API
delivered hereunder is Nonconforming API within the time period specified in
Section 6.1, Noramco will have [***] to inspect the allegedly Nonconforming API
and make a reasonable assessment of the alleged nonconformance.  At Noramco’s
request, Purchaser must promptly supply samples of the allegedly Nonconforming
API or some other evidence of nonconformity that Noramco may reasonably specify.

 

6.3.                            If Noramco disagrees with Purchaser’s
determination that API delivered hereunder is Nonconforming API, Noramco shall
promptly notify Purchaser and, if the Parties are unable to resolve such
disagreement within a [***] period, such disagreement will be investigated in
accordance with the Quality Agreement.  If the Parties cannot agree after such
investigation whether such API is in fact Nonconforming API, (a) if Purchaser
alleges that such API does not meet the Specifications, then samples of such API
will be submitted to a qualified independent laboratory mutually agreed to by
Noramco and Purchaser for testing and such laboratory will use the test methods
contained in the applicable Specifications or (b) if Purchaser alleges that such
API has not been manufactured in accordance with cGMP(s), then such disagreement
shall be referred to a mutually agreed upon third party expert for resolution
which shall include root cause investigation, independent expert assessment,
independent third party testing and replacement of API.  The determination of
such laboratory or third party expert with respect to all or part of such API
will be final and binding on the Parties, absent manifest error.  The fees and
expenses of the laboratory or third party expert incurred in making such
determination will be paid by Noramco, if the determination is made against
Noramco or by Purchaser, if the determination is made against Purchaser.

 

6.4.                            If the Parties agree or there is a determination
under Section 6.3 that any API delivered hereunder is Nonconforming API,
Noramco, at its sole cost and expense and as Purchaser’s sole remedy shall,
subject to Sections 10.4 and 10.5, promptly replace such Nonconforming API and
reimburse Purchaser [***].  Nonconforming API will be returned to Noramco at its
expense.

 

6.5                               During the Term and for [***] thereafter,
Purchaser shall have the right, upon at least [***] notice, to inspect, during
normal business hours, those areas of Noramco’s production facilities where API
is manufactured, handled, packaged and stored, any facility or location where
API is tensed, and to audit the records described in this Agreement.

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

8

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

 

7.                                      PRODUCT COMPLAINTS, ADVERSE EXPERIENCES
AND RECALLS

 

7.1.                            During the Term, Noramco shall assist Purchaser
with any necessary investigation arising from customer complaints relating to
Product in accordance with the Quality Agreement.  Without in any manner
limiting the foregoing, each of Purchaser and Noramco shall comply with FDA
requirements for complaint handling. Purchaser shall maintain a system for
monitoring, investigating, and following up on adverse event reports received by
it involving Product(s), and shall provide prompt notice to Noramco of any
Product complaints, including, but not limited to, information concerning
adverse drug events that are required to be reported to FDA, side effects,
injury, toxicity, or sensitivity reaction in those instances where the adverse
drug event can be attributed specifically to the API.

 

7.2.                            Each Party shall notify the other Party of any
regulatory action or other action concerning the safety of the API in accordance
with the Quality Agreement, including but not limited to FDA inspection reports,
warning letters or import alerts.

 

7.3.                            In the event of a recall of Product that does
not result from the breach of Noramco’s obligations under Section 2.4 to
manufacture API in accordance with cGMP and the Specifications, as between
Noramco and Purchaser, [***]  For the purposes of this Section 7.3, [***].

 

8.                                      MANUFACTURING INTERRUPTIONS, QUOTA
RESTRICTIONS AND SHORTAGES

 

8.1.                            Manufacturing Interruptions.  Purchaser
acknowledges that the day-to-day manufacturing operation of the facilities used
by Noramco to produce API may be subject to interruptions, fluctuations,
slow-downs, suspensions and reductions, due to a variety of reasons in the
ordinary course of business (“Manufacturing Interruptions”).  If Noramco
believes that a Manufacturing Interruption is reasonably likely to result in a
material reduction of API available to be delivered to Purchaser, Noramco shall
provide notice to Purchaser of, and consult with Purchaser about, such
Manufacturing Interruption prior to or as soon as reasonably possible after the
commencement of such Manufacturing Interruption.  After the termination of any
Manufacturing Interruption that results in a material reduction of API, Noramco
shall promptly communicate to Purchaser regarding the termination of such
Manufacturing Interruption and the reason therefor, as well as any actions taken
or planned to be taken to prevent a repeat event.

 

8.2.                            Manufacturing Quota Restrictions.  Purchaser
further acknowledges that the production and supply of API is contingent upon
DEA rules, orders or directives related to the Manufacturing Quota that may
limit or restrict the manufacture or supply of API by Noramco to Noramco’s
customers (“Manufacturing Quota Restrictions”).  If Noramco believes that a
Manufacturing Quota Restriction is reasonably likely to result in a material
reduction or suspension of the delivery of API to Purchaser, Noramco shall
promptly consult with Purchaser to coordinate with respect to their respective
obligations in accordance with Sections 8.4 and 8.5.

 

8.3.                            Procurement Quota Restrictions.  It is the sole
responsibility of Purchaser, and Purchaser shall use [***] efforts, to obtain
Procurement Quota for API, provided that Noramco shall reasonably cooperate with
Purchaser to assist Purchaser in obtaining Procurement Quota.  Noramco
acknowledges that Purchaser’s receipt of API manufactured by Noramco is
contingent

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

9

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

 

upon DEA rules, orders or directives related to the Procurement Quota that may
limit or restrict Noramco’s customers from receiving API manufactured by Noramco
(“Procurement Quota Restrictions”).  If Purchaser believes that a Procurement
Quota Restriction is reasonably likely to result in Purchaser’s inability to
take delivery of an API from Noramco in accordance with the delivery date set
forth in a Purchase Order, Purchaser shall promptly consult with Noramco to
coordinate with respect to their respective obligations in accordance with
Section 8.4.

 

8.4.                            Failure to Obtain Quota.  Each Party shall use
[***] efforts to prepare and plan for the supply and purchase of API(s) against
Purchase Orders to be given in accordance with the Forecasts in anticipation of
each Party receiving applicable quota from the DEA.  In the event that a Party
does not obtain the necessary Manufacturing Quota or Procurement Quota, as the
case may be, to allow it to perform its obligations under this Agreement, such
Party shall promptly inform the other Party in writing.  In the event that there
is not sufficient Manufacturing Quota or Procurement Quota with respect to an
outstanding Purchase Order, such Purchase Order shall nonetheless remain valid
and binding upon the Parties, provided that the Purchase Order delivery date
will be adjusted by the Parties for a period not to exceed [***] so as to permit
receipt of the necessary Manufacturing Quota or Procurement Quota, as the case
may be.  In the event that Manufacturing Quota is not received by Noramco within
[***] of the original delivery date set forth in a Purchase Order, then such
Purchase Order may be, but is not required to be, cancelled by Purchaser by
written notice to Noramco, which cancellation shall be Purchaser’s sole and
exclusive remedy for the applicable Manufacturing Quota Restriction.  In the
event that Purchaser does not obtain Procurement Quota within [***] of the
original delivery date set forth in a Purchase Order, [***].

 

8.5.                            Allocation Among Customers and Cooperation. 
Purchaser recognizes that, due to Manufacturing Interruptions or Manufacturing
Quota Restrictions, Noramco may produce less API in any given time period than
anticipated, and that Noramco may, at its discretion, allocate its available
supply of API among its customers, itself, and its Affiliates [***]. 
Notwithstanding the above, Noramco shall (a) use [***] efforts to minimize
interruptions in the supply of API and (b) use [***] efforts to coordinate with
Purchaser to mitigate against the consequences of any shortages related to
Manufacturing Interruptions or Manufacturing Quota Restrictions.

 

8.6.                            No Liability for Manufacturing Quota
Restrictions.  Subject to Noramco’s compliance with its obligations set forth in
this Article 8, Noramco shall not be liable to Purchaser for any damage,
inconvenience, or any other consequences that may arise from Manufacturing Quota
Restrictions.

 

9.                                      WARRANTIES; DISCLAIMER

 

9.1.                            Noramco hereby represents, warrants and
covenants to Purchaser that:

 

9.1.1.                  it has the corporate authority to enter into this
Agreement and to perform its obligations hereunder;

 

9.1.2.                  it is not subject to any legal, contractual or
regulatory restriction, limitation or conditions that may affect adversely its
ability to perform its obligations hereunder; and

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

10

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

 

9.1.3.                  all API sold to Purchaser by Noramco pursuant to this
Agreement shall meet all Specifications.

 

9.2.                            Purchaser hereby represents, warrants and
covenants to Noramco that:

 

9.2.1.                  it has the corporate authority to enter into this
Agreement and to perform its obligations hereunder; and

 

9.2.2.                  it is not subject to any legal, contractual or
regulatory restriction, limitation or conditions that may affect adversely its
ability to perform its obligations hereunder.

 

9.3.                            THE PARTIES AGREE THAT, EXCEPT AS EXPRESSLY SET
FORTH IN THIS ARTICLE 9, NEITHER PARTY MAKES ANY REPRESENTATIONS OR EXTENDS ANY
WARRANTIES OF ANY KIND AND THE LIMITED REPRESENTATIONS AND WARRANTIES CONTAINED
IN THIS ARTICLE 9 ARE THE SOLE REPRESENTATIONS AND WARRANTIES WITH RESPECT TO
API AND ARE MADE EXPRESSLY IN LIEU OF, AND EXCLUDE, ANY IMPLIED WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR NON-INFRINGEMENT OF THIRD
PARTY PATENT RIGHTS AND ALL OTHER EXPRESS OR IMPLIED WARRANTIES PROVIDED BY
APPLICABLE LAW, INCLUDING THE UNIFORM COMMERCIAL CODE AND THE UN CONVENTION ON
CONTRACTS FOR THE INTERNATIONAL SALE OF GOODS.

 

10.                               INDEMNIFICATION; CONSEQUENTIAL DAMAGES AND
LIMITATION OF LIABILITY

 

10.1.                     Purchaser shall indemnify, defend, save and hold
Noramco and each of its Affiliates and their respective officers, directors,
employees and agents (each a “Noramco Indemnitee”) harmless from and against any
liability, loss, costs, damage and/or expense, including reasonable attorneys,
experts and consultants fees and disbursements (“Loss or Losses”) in connection
with any and all suits, investigations (governmental or otherwise), claims,
proceedings or demands initiated or filed by a third party (each an “Action”)
against a Noramco Indemnitee, to the extent resulting from or arising out of
(a) any breach of any representation, warranty or covenant hereunder by any
Purchaser Indemnitee; (b) a Purchaser Indemnitee’s negligence or willful
misconduct; or (c) Purchaser’s, manufacture, use or sale of Product, in each
case ((a), (b) and (c)), except to the extent that such Losses result from or
arise out of a Noramco Indemnitee’s negligence or willful misconduct.

 

10.2.                     Noramco shall indemnify, defend, save and hold
Purchaser and each of its Affiliates and their respective officers, directors,
employees and agents (each a “Purchaser Indemnitee”) harmless from and against
Loss or Losses in connection with any Action against a Purchaser Indemnitee, to
the extent resulting from or arising out of (a) any breach of any
representation, warranty or covenant hereunder by a Noramco Indemnitee or (b) a
Noramco Indemnitee’s negligence or willful misconduct, in each case ((a) and
(b)), except to the extent that such Losses result from or arise out of a
Purchaser Indemnitee’s negligence or willful misconduct.

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

11

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

 

10.3.                     Upon becoming aware of an Action subject to
indemnification under Section 10.1 or 10.2, the Party entitled to
indemnification (the “Indemnified Party”) shall give prompt written notice
thereof to the other Party (the “Indemnifying Party”), which notice shall
include reasonable details of the nature of the Action and the basis of the
indemnity claim, and shall further expressly state that the Indemnified Party it
is seeking indemnity pursuant to this Agreement.  For the avoidance of doubt,
and without prejudice to the Indemnified Party’s obligation to give prompt
written notice, an Indemnifying Party’s knowledge of events or circumstances
pursuant to which an Indemnified Party might seek indemnification, including
correspondence between the Parties regarding a matter for which indemnity is not
expressly sought, shall not constitute the notice required by this provision,
and any attorneys, experts or consultant fees or expenses incurred by an
Indemnified Party prior to proper notice shall be the sole responsibility of
such Party; provided, however, that failure to provide timely notice shall not
bar any indemnification claim unless the Indemnifying Party shall be, or has
been, materially prejudiced by failure to receive such timely notice [***].

 

10.4.                     [***].

 

10.5.                     [***]

 

11.                               CONFIDENTIALITY

 

11.1.                     Each Party agrees that it and its Affiliates (a) will
not disclose any Confidential Information of the other Party to any third party
at any time during the Term without the prior written consent of such other
Party; (b) will not make use of any Confidential Information of the other Party
for any purpose other than the performance of its obligations under this
Agreement and (iii) will use all reasonable efforts to prevent unauthorized
publication or disclosure by any Person of Confidential Information of the other
Party.  Notwithstanding the foregoing, (i) a Party may disclose Confidential
Information of the other Party to its Affiliates, and to its and their
directors, employees, consultants, and agents, in each case who, in such
disclosing Party’s sole determination, have a specific need to know such
Confidential Information and who are bound by obligations of confidentiality and
restriction on use no less restrictive than those set forth in this Article 11
and (ii) Noramco may disclose Confidential Information of Purchaser in
accordance with Section 14.2.

 

11.2.                     Notwithstanding the foregoing, a Party may, upon
reasonable prior written notice to the other Party if permitted, disclose
Confidential Information of the other Party to the extent necessary to comply
with law or court order, provided that such first Party provides prior written
notice of such disclosure to the other Party if permitted and takes all
reasonable actions to avoid or minimize the degree of such disclosure.

 

11.3.                     All Confidential Information in any form must be
returned to the Party who disclosed the Confidential Information within thirty
(30) days of the termination or expiration of this Agreement, provided that the
receiving Party may retain one copy of Confidential Information disclosed to it
hereunder as a record of such receiving Party’s ongoing confidentiality
obligations under this Agreement, which copy shall either be returned to the
Party who disclosed the Confidential Information within thirty (30) days after
the [***] period referred

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

12

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

 

to in Section 11.4 or, if not returned, shall continue to be subject to the
confidentiality provisions of this Agreement indefinitely.

 

11.4.                     The confidentiality and non-use obligations of this
Agreement shall remain in effect during the Term and for a period of [***]
thereafter.

 

11.5.                     “Confidential Information” means [***]. 
Notwithstanding the foregoing, Confidential Information does not include
information, data or know-how that the receiving Party can show:

 

(a)                                 was in the public domain at the time of the
disclosure to the receiving Party, or thereafter became part of the public
domain without any fault of the receiving Party;

 

(b)                                 rightfully was in its possession prior to
the disclosure by the disclosing Party;

 

(c)                                  was lawfully obtained from a third party
who had the right to make such disclosure, as evidenced by written records; or

 

(d)                                 was developed by the receiving Party
independently of that disclosure, as evidenced by written records, by
individuals who did not rely on or otherwise use Confidential Information.

 

12.                               INTELLECTUAL PROPERTY

 

12.1.                     Noramco hereby grants to Purchaser during the Term a
non-exclusive, royalty-free license under the API Manufacturing Patents to
(a) use API supplied by Noramco to Purchaser hereunder to make or have made
Products for distribution in the United States and (b) offer for sale, sell,
commercialize and import Products containing API supplied by Noramco to
Purchaser hereunder in the United States.

 

12.2.                     [***]

 

12.3.                     All rights to and interests in Noramco’s and its
Affiliates’ intellectual property, including any improvements thereto, will
remain solely with Noramco and its Affiliates and no right or interest therein
is transferred or granted to Purchaser under this Agreement, except as expressly
provided for herein or in the Asset Purchase Agreement.  Except as otherwise set
forth in the Asset Purchase Agreement, Purchaser agrees that it does not
acquire, pursuant to this Agreement, any license or any other right to Noramco’s
or its Affiliate’s intellectual property or improvements thereto, except as
expressly provided for herein.

 

12.4.                     [***]

 

13.                               TERM, RENEWAL AND TERMINATION

 

13.1.                     The initial term of this Agreement shall commence on
the Effective Date and shall continue until the [***] anniversary of the
Effective Date, unless sooner terminated as

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

13

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

 

expressly provided for in this Agreement (the “Initial Term”).  Thereafter, this
Agreement shall be automatically renewed for additional terms of [***] (each, a
“Renewal Term” and all Renewal Terms together with the Initial Term, the
“Term”).  If [***], either party may notify the other Party in writing no later
than [***] prior to the end of the then-current Initial Term or Renewal Term, as
the case may be, that it does not wish to renew the Agreement.  If [***],
Noramco may notify Purchaser in writing no later than [***] prior to the end of
the then-current Initial Term or Renewal Term, as the case may be, that it does
not to wish to renew the Agreement.

 

13.2.                     Purchaser may terminate this Agreement without cause
immediately following [***] prior written notice to Noramco; [***].

 

13.3.                     This Agreement may be terminated by either Party by
giving written notice to the other Party if the other Party (the “Breaching
Party”) is in material breach or default of any of its obligations hereunder
(including any payment obligations) as follows: (a) the terminating Party must
send written notice of the material breach or material default to the Breaching
Party; and (b) the termination shall become effective [***] after receipt of
such written notice by the Breaching Party unless either (i) the Breaching Party
has cured such material breach or default prior to the expiration of such [***]
period or (ii) if such material breach or material default is not capable of
being cured within such [***] period, the Breaching Party has commenced
activities reasonably expected to cure such material breach or material default
within such [***] period and thereafter uses diligent efforts to complete the
cure as soon as practicable, provided that, if such material breach or material
default is not cured within [***] after receipt of such written notice by the
Breaching Party, the termination shall become effective upon the expiration of
such [***] period.

 

13.4.                     Either Party may terminate this Agreement without
prior notice to the other upon the occurrence of any of the following involving
the other Party:

 

(a)                                 that other Party files a petition seeking an
order for relief under the Federal Bankruptcy Code (Title 11 of the United
States Code), as now or hereafter in effect, or under similar law (including
laws in countries or jurisdictions other than the United States), or files a
petition in bankruptcy or for reorganization or for an arrangement pursuant to
any state bankruptcy law or any similar state or local law (including laws in
countries or jurisdictions other than the United States); or

 

(b)                                 an involuntary case against the other Party
as debtor is commenced by a petition under the Federal Bankruptcy Code (Title 11
of the United States Code), as now or hereafter in effect, or under similar law
(including laws in countries or jurisdictions other than the United States), or
a petition or answer proposing the adjudication of the other Party as a bankrupt
or its reorganization pursuant to any state bankruptcy law or any similar state
or local law (including laws in countries or jurisdictions other than the United
States) is filed in any court and not dismissed, discharged or denied within
[***] after the filing thereof; or

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

14

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

 

(c)                                  a custodian, receiver, United States
Trustee, trustee or liquidator of the other Party or of all or substantially all
of the other Party’s property is appointed in any proceedings brought by the
other Party; or

 

(d)                                 a custodian, receiver, United States
Trustee, trustee or liquidator is appointed in any proceedings brought against
the other Party and is not be discharged within [***] after that appointment, or
if the other Party consents to or acquiesces in such appointment; or

 

(e)                                  the other Party generally does not pay its
debts as those debts become due, or makes an assignment for the benefit of
creditors, or admits in writing its inability to pay its debts generally as they
become due.

 

13.5.                     Any expiration or termination of this Agreement shall
not release the Parties from liabilities or obligations accrued on or prior to
the date of expiration or termination. The following provisions shall survive
termination and/or expiration of this Agreement indefinitely or for such shorter
period as is provided in such Articles or Sections, along with any other
provisions of this Agreement that are necessary to interpret or give effect to
any of the following provisions: (a) Sections 6.5, 8.6, 9.3 and 12.3; and
(b) Articles 10 (Indemnification; Consequential Damages; Limitations of
Liability), 11 (Confidentiality), 15 (Notices); 19 (Dispute Resolution); 23 (No
Benefit to Third Parties), and 24 (Publicity).

 

14.                               INDEPENDENT CONTRACTORS; SUBCONTRACTORS

 

14.1.                     The status of the Parties under this Agreement is that
of independent contractors.  Nothing is this Agreement may be construed as
establishing a partnership or joint venture relationship between the Parties
hereto.  No Party has the right to enter into any agreements on behalf of the
other Party, nor may it represent to any Person that it has that right or
authority.

 

14.2.                     Noramco may subcontract any or all of its obligations
hereunder to any of its Affiliates without the approval of Purchaser or to any
other third party approved by Purchaser (which approval shall not be
unreasonably withheld), provided that Noramco shall remain fully responsible for
performing such obligations in compliance with this Agreement and shall take
reasonable measures to ensure that its subcontractors perform such obligations
in compliance with this Agreement.  [***]  Notwithstanding anything in this
Agreement to the contrary, Noramco shall be permitted to share Confidential
Information of Purchaser with its permitted subcontractors, provided such
subcontractor is bound by obligations of confidentiality and restriction on use
no less restrictive than those set forth in Article 11.

 

15.                               NOTICES

 

All notices, requests, demands and other communications under this Agreement
shall be in writing and shall be deemed to have been duly given if delivered,
addressed or telecopied to the address or telecopier number set forth below and
shall be deemed to have been made:  (a) on the date of service, if served
personally on the Party; (b) on the second business day after delivery to an
overnight courier service, if first available delivery is indicated and paid
for; (c) on the third business day after mailing, if mailed to the Party to whom
notice is to be given, by first class mail, registered or certified, postage
prepaid; or

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

15

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

 

(iv) on the date of transmission, if sent by telecopier and confirmation of
transmittal is received by the transmitting Party.  Any Party may change its
address for purposes of this Article by giving the other Party’s written notice
of the new address in the manner set forth above.

 

If to Purchaser:

 

Depomed, Inc.

 

 

7999 Gateway Blvd., Suite 300

 

 

Newark, California 94560

 

 

Attention: Legal Department

 

 

Facsimile No.: 510-744-8001

 

 

 

If to Noramco:

 

Noramco, Inc.

 

 

[***]

 

16.                               FORCE MAJEURE

 

16.1.                     Neither Party will be liable for non-performance or
delay in the fulfillment of its obligations under this Agreement if such
non-performance or delay is occasioned by any cause beyond the reasonable
control of Purchaser or Noramco, as the case may be, including acts of God,
fire, flood, earthquakes, explosions, sabotage, strikes, or labor disturbances
(regardless of the reasonableness of the demands of the labor force), civil
commotion, riots, military invasions, wars, failure of utilities, failure of
carriers, inability to obtain any required raw material, energy source,
equipment, labor or transportation, at prices and on terms Noramco deems
practicable from its usual sources of supply or any acts, restraints,
requisitions, regulations, or directives issued by a competent government
authority, including changes in law or regulation (“Force Majeure Events”);
provided, however, a Force Majeure Event shall never excuse a Party from paying
any sum of money owed under the terms of this Agreement.

 

16.2.                     In the event that either Party is prevented from
discharging its obligations under this Agreement on account of a Force Majeure
Event, that Party shall promptly notify the other Party, and shall nevertheless
make reasonable, good faith efforts to discharge its obligations, even if in a
partial or compromised manner.  In the event that a Force Majeure Event
continues for a period of [***], the Party not claiming the Force Majeure Event
will be entitled to terminate this Agreement forthwith, but without penalty or
liability to the Party affected by the Force Majeure Event, on written notice to
the Party claiming the Force Majeure Event, provided that such termination shall
not affect any Party’s right to receive amounts which have accrued or became due
prior to the termination.

 

16.3                        The Party affected by a Force Majeure Event shall
use commercially reasonable efforts to limit the effects of a Force Majeure
Event upon its performance of the Agreement and shall notify the other Party,
immediately, of the cessation of the Force Majeure Event.

 

17.                               ENTIRE AGREEMENT; MODIFICATION

 

This Agreement, including the appendices hereto which are incorporated by
reference, constitutes the entire agreement of the Parties with respect to its
subject matter and supersedes all prior agreements, arrangements, dealings and
writings between the Parties that relate to the matters covered herein.  Any
terms and conditions of an invoice, acknowledgement or similar document provided
by Noramco for

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

16

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

 

API, or any terms and conditions of Purchase Orders provided by Purchaser for
API, which are inconsistent with or in addition to the terms of this Agreement
shall be null and void.  This Agreement may not be amended or modified except in
writing executed by the duly authorized representatives of both Parties.

 

18.                               WAIVER

 

No waiver of a breach or default hereunder will be considered valid unless
written and signed by the Party granting such waiver, and no waiver will be
deemed a waiver of any subsequent breach or default of the same or similar
nature.

 

19.                               DISPUTE RESOLUTION

 

19.1.                     Any controversy or claim arising out of or relating to
this Agreement, including any such controversy or claim involving any Affiliate
of any Party (a “Dispute”), shall first be submitted to mediation according to
the Commercial Mediation Procedures of the American Arbitration Association
(“AAA”)  (see www.adr.org).  Such mediation shall be attended on behalf of each
Party for at least one session by a senior business person with authority to
resolve the Dispute.  Any period of limitations that would otherwise expire
between the initiation of mediation and its conclusion shall be extended until
[***] days after the conclusion of the mediation.

 

19.2.                     Any Dispute that cannot be resolved by mediation
within [***] days of notice by one Party to the other of the existence of a
Dispute (unless the Parties agree to extend that period) shall be resolved by
arbitration in accordance with the Commercial Arbitration Rules of the AAA (“AAA
Rules”; see www.adr.org) and the Federal Arbitration Act, 9 U.S.C. §1 et seq.. 
The arbitration shall be conducted in New Jersey, by one arbitrator appointed in
accordance with the AAA Rules.

 

19.3.                     The arbitrator shall follow the ICDR Guidelines for
Arbitrators Concerning Exchanges of Information in managing and ruling on
requests for discovery.  The arbitrator, by accepting appointment, undertakes to
exert her or his best efforts to conduct the process so as to issue an award
within [***] of her or his appointment, but failure to meet that timetable shall
not affect the validity of the award.

 

19.4.                     The arbitrator shall decide the Dispute in accordance
with the substantive law of New Jersey.  The arbitrator may not award special,
indirect, incidental, punitive or consequential damages (including loss of
profits or loss of opportunity), or lost profits even if designated direct
damages, nor may the arbitrator apply any multiplier to any award of actual
damages, except as may be required by statute.  The award of the arbitrator may
be entered in any court of competent jurisdiction.

 

20.                               SEVERABILITY

 

Should any part or provision of this Agreement be held unenforceable or in
conflict with applicable law, the invalid or unenforceable part or provision
will, so long as it does not go to the essence of this Agreement, be replaced
with a revision that accomplishes, to the extent possible, the original

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

17

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

 

commercial purpose of that part or provision in a valid and enforceable manner,
and the balance of this Agreement shall remain in full force and effect and
binding upon the Parties hereto.

 

21.                               SUCCESSORS AND ASSIGNS

 

This Agreement may not be assigned or otherwise transferred by a Party without
the prior written consent of the other Party; provided, however, that (i) either
Party may, without such consent, but with notice to the other Party, assign this
Agreement, in whole or in part: (a) in connection with the transfer or sale of
all or substantially all of such Party’s assets or the line of business for the
API (in the case of Noramco) or the Products (in the case of Purchaser); (b) to
a successor entity or acquirer in the event of a sale, merger, consolidation,
change of control or similar transaction of such Party; or (c) to any Affiliate
of such Party (in that case, so long as such assigning Party remains fully
liable for all of its obligations hereunder as a primary obligor);
(ii) Purchaser may, without such consent, but with notice to Noramco, assign
this Agreement (a) in connection with any transaction the primary purpose of
which is to change the domicile of Purchaser or (b) to any lender of Purchaser
or purchaser of securities used to finance the Transactions as collateral
security to secure the obligations of any indebtedness of Purchaser; and
(iii) in the event Noramco determines, in its sole discretion, that Noramco and
its Affiliates will permanently discontinue all manufacture and supply of API,
Seller shall notify Purchaser about the decision without delay and, thereafter,
Noramco shall have the right to assign this Agreement in its entirety to [***]. 
Any permitted assignee will assume the rights and obligations of its assignor
under this Agreement.  Any purported assignment in violation of this Section 21
will be void.

 

22.                               COUNTERPARTS

 

This Agreement may be executed in one or more counterparts, each of which shall
be deemed an original, and together shall constitute one and the same agreement
and shall become effective when one or more counterparts have been signed by
each of the Parties and delivered to the other Party, it being understood that
both Parties need not sign the same counterpart.  This Agreement, following its
execution, may be delivered via telecopier machine or other form of electronic
delivery, which shall constitute delivery of an execution original for all
purposes.

 

23.                               NO BENEFIT TO THIRD PARTIES

 

The representations, warranties, covenants and agreements set forth in this
Agreement are for the sole benefit of the Parties hereto and their successors
and permitted assigns, and they will not be construed as conferring any rights
on any other Persons.

 

24.                               PUBLICITY

 

Neither Party may make any press release or public statement regarding the
subject matter of this Agreement or the existence thereof or use the other
Party’s or its Affiliates’ names, trademarks, logos, symbols or other image in
any form of advertising, promotion or publicity without the prior written
consent of the other Party, except to the extent that the press release or
public statement may be required by applicable law.

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

18

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

 

25.                               INTERPRETATION

 

25.1.                     The words “hereof”, “herein”, “hereto” and “hereunder”
and words of similar import, when used in this Agreement, shall refer to this
Agreement as a whole and not to any particular provision of this Agreement.

 

25.2.                     The terms defined in the singular shall have a
comparable meaning when used in the plural, and vice versa.

 

25.3.                     The terms “U.S. Dollars” and “$” shall mean lawful
currency of the United States of America.

 

25.4.                     The terms “include,” “includes” and “including” shall
mean “including, without limitation.”

 

25.5.                     When a reference is made in this Agreement to an
Article, a Section, an Exhibit or a Schedule, such reference shall be to an
Article or a Section of, or an Exhibit or a Schedule to, this Agreement unless
otherwise indicated.

 

25.6.                     Time periods based on a number of days within or
following which any payment is to be made or act is to be done shall be
calculated by excluding the day on which the period commences and including the
day on which the period ends and, if applicable, by extending the period to the
next business day following if the last day of the period is not a business day.

 

25.7.                     The term “United States” shall refer to the United
States of America and its territories, including Puerto Rico.

 

[Remainder of Page is Intentionally Blank]

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

19

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

 

IN WITNESS WHEREOF, each of the Parties has executed this Agreement on the
Effective Date.

 

 

 Depomed, Inc.

 

 

 

 

 

By:

/s/ James A. Schoeneck

 

Name:

James A. Schoeneck

 

Title:

President and Chief Executive Officer

 

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

[Signature Page for API Supply Agreement]

 

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

 

Noramco, Inc.

 

 

 

 

 

By:

/s/ Matthew Martin

 

Name:

Matthew Martin

 

Title:

General Manager

 

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

[Signature Page for API Supply Agreement]

 

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

 

APPENDIX A

 

Products

 

[***]

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

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

 

APPENDIX B

 

Specifications

 

[***]

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

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

 

APPENDIX C

 

Commercial Supply Price

 

[***]

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

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

 

APPENDIX D

 

Finished Good Tapentadol Calculation

 

[***]

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

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