Exhibit 10.1
NOTE PURCHASE AND AMENDMENT AGREEMENT
     Note Purchase and Amendment Agreement, dated as of March 3, 2010 (this
“Agreement”), by and among Columbia Laboratories, Inc., a Delaware corporation
(the “Company”), the holders of the Notes (as defined below) listed on
Schedule I attached hereto (each a “Holder” and collectively, the “Holders”).
PRELIMINARY STATEMENT
     The Holders own the aggregate principal amount of the Company’s Convertible
Subordinated Notes due December 31, 2011 (the “Notes”) set forth on Schedule I;
the Notes owned by the Holders being referred to herein as the “Holder Notes”.
     The Notes were purchased by the Holders pursuant to that certain Securities
Purchase Agreement, dated December 21, 2006 (the “SPA”), among the Company, the
Holders and the other purchasers of the Notes named therein.
     The Holders wish to sell to the Company, and the Company wishes to
purchase, the Holder Notes, on the terms and conditions hereinafter set forth.
     In consideration of the mutual covenants contained herein and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties, intending to be legally bound, hereby agree as
follows:
ARTICLE I
PURCHASE AND SALE
     1.1 Note Purchase. At the Closing, on the terms and subject to the
conditions hereof and in consideration of the Purchase Price (as defined below)
and the agreements of the Company set forth herein, each Holder will sell,
convey, transfer, assign and deliver to the Company, and the Company will
purchase, take delivery of and acquire from each Holder, all of such Holder’s
right, title and interest in the Holder Notes.
     1.2 Purchase Price. The aggregate purchase price (the “Purchase Price”) for
the Holder Notes shall be (i) $11,699,998.54 in cash (the “Cash Consideration”),
plus accrued and unpaid interest on the Notes (calculated in accordance with the
Notes) up to (but excluding) the Closing Date payable in cash, (ii) warrants to
purchase 3,488,370 shares of the Company’s common stock, $0.01 par value per
share (the “Common Stock”), substantially in the form attached as Exhibit A
hereto (the “Warrants”) and (iii) 3,333,330 shares of Common Stock (the
“Shares”), in each case as allocated among the Holders as set forth on
Schedule I.
     1.3 Amendment Consent. Each Holder hereby irrevocably consents and agrees
that the Notes shall be amended as set forth in the amendment (the “Amendment”)
to the Notes, in the form attached as Exhibit B hereto. The Amendment will
become effective on the date that the Note Amendment Condition is satisfied;
provided, on the Amendment Termination Date (as defined below), if it occurs,
the Amendment will terminate and be of no further force and effect, and from and
after the Amendment Termination Date, the Notes shall no longer be modified by
the Amendment. The Company will notify the Holders when the Note Amendment
Condition

 

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has been satisfied. “Amendment Termination Date” means the earliest of
(i) August 31, 2010, only if the Closing has not occurred on or prior to
August 31, 2010, (ii) the date, if any, after the date hereof and prior to the
Closing Date, on which holders of at least 25% of the aggregate principal amount
of the Notes have not consented to the Amendment or have rightfully terminated
the Note Purchase and Amendment Agreements (as defined in Section 7.10) that
they are a party to (in accordance with the terms of such Note Purchase and
Amendment Agreements), and (iii) the Business Day following the date on which
the Sale Condition is satisfied, only if the Closing has not occurred on or
prior to such Business Day.
     1.4 Closing. The closing of the purchase and sale of the Holder Notes (the
“Closing”) shall take place at the offices of Kaye Scholer LLP, 425 Park Avenue,
New York, New York 10022 at 10:00 a.m. New York City time on the date on which
the Sale Condition is satisfied; provided, that, (i) all of the other conditions
set forth in Sections 1.5, 1.6 and 1.7 have been satisfied or waived (by the
appropriate party) on or prior to such date, (ii) all closings under all Note
Purchase and Amendment Agreements (as defined in Section 7.10) shall occur on
the same date and (iii) the satisfaction of the Sale Condition shall occur
contemporaneously with the Closing, or at such other place, date and time as the
parties hereto may agree in accordance with Section 7.10 (the “Closing Date”).
     1.5 General Closing Conditions. The respective obligations of the Company
and the Holders to consummate the Closing are subject to the satisfaction or
waiver (jointly by the Company and the Holders) at or prior to the Closing of
the following conditions:
     (a) The initial consummation, on the same date as the Closing, by the
Company of the transaction (or series of related transactions) publicly
announced by the Company in a Current Report on Form 8-K filed by the Company on
or prior to the date which is one Business Day after the date hereof (the
“Form 8-K”) with the Securities and Exchange Commission (the “SEC”), which
transaction includes the license, sale, transfer or other disposition of rights
or assets of the Company related to, and/or the co-development, co-promotion,
co-marketing, distribution or other collaboration with respect to, one or more
of the Company’s products (and a sale of Company capital stock), pursuant to
which the Company receives proceeds of at least $40 million in cash
consideration at the initial closing thereof (the “Sale Condition”);
     (b) The filing, after the date hereof, with, and the acceptance of such
filing by, the Secretary of State of the State of Delaware of an amendment to
the Company’s certificate of incorporation to increase the number of the
Company’s authorized shares of Common Stock (the “Charter Amendment”);
     (c) The Company shall have received written consents from the holders of at
least 75% of the outstanding principal amount of the Notes to the Amendment (the
“Note Amendment Condition”);
     (d) The Company shall have obtained (i) all necessary blue sky law permits
and qualifications, or secured exemptions therefrom, required by any state for
the sale and offer of the Warrants (and the shares of Common Stock issuable upon
exercise of the Warrants (the “Warrant Shares” and collectively with the
Warrants and the Shares, the “Securities”)) and the Shares issued pursuant to
this Agreement and (ii) if the Company determines it to be necessary, approval
by the Company’s stockholders of the transactions (or certain of or all of them)
contemplated by the Note Purchase

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and Amendment Agreements (as defined in Section 7.10) to the extent required by
the listing rules of the NASDAQ Global Market or otherwise (the “Stockholder
Approval”);
     (e) The Company shall have satisfied in full its obligations in respect of
the Senior Debt (as defined in the Notes) and obtained an acknowledgement from
the holder of the Senior Debt in substantially the form of Exhibit C hereto (the
“Senior Debt Satisfaction”); and
     (f) No governmental authority (including a court) of competent jurisdiction
shall have issued an order, decree or ruling, or taken any other action,
restraining, enjoining or otherwise prohibiting the transactions contemplated by
this Agreement (including the Amendment), which order, decree, ruling or other
action is in effect at the time the Closing would otherwise occur.
     1.6 Conditions to the Obligations of the Company. The obligation of the
Company to consummate the Closing is subject to the satisfaction or waiver (by
the Company in its sole discretion) at or prior to the Closing of the following
conditions:
     (a) The representations and warranties of each Holder contained in
Article II shall be true and correct in all material respects as of the date
hereof and as of the Closing Date as though made on and as of the Closing Date
(unless any such representation or warranty expressly relates to an earlier
date, in which case such representation or warranty shall be true and correct
only as of such earlier date);
     (b) All covenants and agreements contained in this Agreement to be
performed by the Holders on or prior to the Closing Date shall have been
performed or complied with in all material respects; and
     (c) The Holders shall have made the deliveries required pursuant to
Section 1.8.
     1.7 Conditions to the Obligations of the Holders. The obligations of the
Holders to consummate the Closing are subject to the satisfaction or waiver (by
the Holders in their sole discretion) at or prior to the Closing of the
following conditions:
     (a) (i) the representation and warranty of the Company contained in Section
3(h) shall be true and correct in all material respects as of the date hereof
and as of the Closing Date as though made on and as of the Closing Date and
(ii) each of the other representations and warranties of the Company set forth
in Article III shall be true and correct in all respects as of the date hereof
and as of the Closing Date as though made on and as of the Closing Date (unless
any such representation or warranty expressly relates to a specified date, in
which case such representation or warranty shall be true and correct only as of
such specified date), except where the failure of such representations and
warranties to be so true and correct would not, individually or in the
aggregate, be reasonably expected to have a Material Adverse Effect;
     (b) All covenants and agreements contained in this Agreement to be
performed by the Company on or prior to the Closing Date shall have been
performed or complied with in all material respects; and
     (c) The Company shall have made the deliveries required pursuant to
Section 1.9.

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     1.8 Closing Deliveries by the Holders. Each Holder shall (and covenants and
agrees to), at the Closing, deliver to the Company the original Holder Notes,
duly endorsed for transfer to the Company or its designated purchaser or
accompanied by duly executed note powers in blank.
     1.9 Closing Deliveries by the Company. The Company shall (and covenants and
agrees to), at the Closing, deliver or cause to be delivered to the Holders
(a) a wire transfer of immediately available funds in the aggregate amount of
the Cash Consideration, (b) the Warrants and (c) the Shares.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
OF THE HOLDERS
     Each Holder agrees, represents and warrants (both as of the date of this
Agreement and as of the Closing Date) as follows:
     (a) Each Holder that is an entity is duly organized, validly existing and
in good standing under the laws of the jurisdiction of its organization, with
full entity power and authority to execute and deliver this Agreement and to
perform its obligations hereunder. Each Holder that is an individual is
competent to enter into this Agreement. Each Holder has duly executed and
delivered this Agreement. The execution, delivery and performance of this
Agreement have been duly authorized by all necessary action of each Holder and
this Agreement constitutes a valid and binding obligation of each Holder,
enforceable against each Holder in accordance with its terms.
     (b) Each Holder is the lawful owner, of record and beneficially, of the
principal amount of Holder Notes set forth opposite its name on Schedule I
hereto under the column “Principal Amount of Holder Notes Owned”, free and clear
of all Encumbrances. At the Closing, the Company will acquire good and valid
title to the Holder Notes, free and clear of all Encumbrances and thereafter no
Holder will have any right, title or interest in and to any Holder Notes.
     (c) The execution and delivery of this Agreement by each Holder, the
performance by each Holder of its obligations hereunder and the consummation of
the transactions contemplated by this Agreement do not (i) violate, contravene
or breach the governing documents of any Holder; (ii) violate, contravene or
breach, or constitute a default under, any contract, agreement, indenture or
instrument to which any Holder is a party, or any Holder’s properties or assets
are bound, or to which any Holder may be subject; or (iii) violate, contravene
or breach any statute or law or any judgment, decree, order, regulation, or rule
of any court or governmental authority applicable to any Holder.
     (d) No Holder is required to obtain any consent, authorization or order of,
or make any filing or registration with, any court or governmental agency or any
regulatory or self regulatory agency in order for it to execute, deliver or
perform its obligations hereunder or under the Holder Notes in accordance with
the terms hereof or thereof, or Transfer (as defined herein) the Holder Notes in
accordance with the terms hereof other than such as have been made or obtained,
or, with respect to filings with the SEC, which will be made as required by such
Holder.

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     (e) Each Holder is an “accredited investor” (as such term is defined under
Rule 501(a) of the Securities Act, as defined herein). Each Holder is acquiring
the Securities for its own account and not with a present view toward the public
sale or distribution thereof and has no intention of selling or distributing any
of such Securities and has no arrangement or understanding with any other
Persons regarding the sale or distribution of such Securities, except, in each
case, as would not result in a violation of the Securities Act of 1933, as
amended (the “Securities Act”); provided, however, that by making the
representations herein, such Holder does not agree to hold any of the Securities
for any minimum or other specific term and reserves the right to dispose of the
Securities at any time in accordance with or pursuant to a registration
statement or an exemption from registration under the Securities Act. Each
Holder agrees not to, directly or indirectly, offer, sell, pledge, transfer or
otherwise dispose of (or solicit any offers to buy, purchase or otherwise
acquire or take a pledge of) (collectively, “Transfer”) any of the Securities
except in compliance with the Securities Act.
     (f) Each Holder understands that the Securities being offered and sold to
it under the Agreement are being offered and sold in reliance upon specific
exemptions from the registration requirements of United States federal and state
securities laws (including the Securities Act) and that the Company is relying
upon the truth and accuracy of, and each Holder’s compliance with the
representations, warranties, agreements, acknowledgments and understandings of
such Holder set forth herein in order to determine the availability of such
exemptions and the eligibility of each Holder to acquire the Securities.
     (g) Each Holder acknowledges and understands that its investment in the
Securities involves a significant degree of risk, including, without limitation,
(i) an investment in the Company is speculative, and only those who can afford
the loss of their entire investment should consider investing in the Company and
the Securities; (ii) such Holder may not be able to liquidate its investment;
(iii) transferability of the Securities may be limited; (iv) such Holder is able
to bear the economic risk of holding the Securities for an indefinite period,
and has knowledge and experience in financial and business matters such that it
is capable of evaluating the risks of the investment in the Securities; and
(v) such Holder has, in connection with such Holder’s decision to engage in the
transactions contemplated by this Agreement, not relied upon any representations
or other information (whether oral or written) other than as set forth in the
representations and warranties of the Company contained herein. Each Holder
understands that a description of certain risks relating to an investment in the
Company are set forth in the Company’s filings with the SEC and each Holder has
carefully reviewed such filings.
     (h) Each Holder understands that no United States federal or state agency
or any other government or governmental agency has passed upon or made any
recommendation or endorsement of the Securities or an investment therein or of
any of the transactions contemplated hereby.
     (i) Transfer or Resale.
     (i) Each Holder understands that the Securities have not been and are not
being registered under the Securities Act or any applicable state securities
laws and, consequently, the Securities may not be transferred unless (A) the
resale thereof is

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registered pursuant to an effective registration statement under the Securities
Act, (B) such Holder has executed and delivered to the Company a certificate in
substantially the form annexed hereto as Exhibit D (the “Certificate”), in which
case such Holder may Transfer its Shares and Warrants in accordance with Rule
144 under the Securities Act, or (C) each such Holder has delivered to the
Company an opinion of counsel (in form, substance and scope reasonably
acceptable to the Company) to the effect that the Securities to be sold or
transferred may be sold or transferred pursuant to an exemption from the
registration requirements of the Securities Act; and
     (ii) Neither the Company nor any other Person is under any obligation to
register the resale by any Holder of any Securities of the Company acquired
pursuant to this Agreement, except as provided in Article V hereof.
     (iii) Subject to Section 2(j), each Holder understands that the Securities
will bear a restrictive legend in substantially the following form (and a
stop-transfer order may be placed against transfer of the Securities):
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. THESE
SECURITIES MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED, TRANSFERRED
OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THESE
SECURITIES UNDER APPLICABLE SECURITIES LAWS OR UNLESS OFFERED, SOLD, PLEDGED,
HYPOTHECATED OR TRANSFERRED PURSUANT TO AN AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THOSE LAWS. COLUMBIA LABORATORIES, INC. SHALL BE
ENTITLED TO REQUIRE AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO COLUMBIA
LABORATORIES, INC. THAT SUCH REGISTRATION IS NOT REQUIRED TO THE EXTENT THAT AN
OPINION IS REQUIRED PURSUANT TO THE AGREEMENT UNDER WHICH THE SECURITIES WERE
ISSUED.
     (j) In the event that a Holder provides the Company with the Certificate,
the Company shall promptly provide such Holder, at such Holder’s request,
without any expense to such Holder (other than applicable transfer taxes and
similar governmental charges, if any), with new certificates representing the
Shares and Warrants held by such Holder not bearing the legend described in
Section 2(i)(iii). For the avoidance of doubt, a Holder may provide the
Certificate at any time prior to, on or following the Closing Date, including
with respect to the Shares and Warrants that will delivered on the Closing Date
in accordance with Section 1.9. If a Holder provides the Company with the
Certificate on or prior to the Closing Date, the Shares and the Warrants to be
issued to such Holder at the Closing shall be issued without any restrictive
legend.
     (k) Each Holder is a resident of the jurisdiction set forth across from its
name on to Schedule I hereto.
     (l) Between the time that a Holder learned about the transactions
contemplated by this Agreement and the public announcement thereof, no Holder
has engaged in any short sales or similar transactions with respect to the
Common Stock, nor has any Holder, directly or indirectly, knowingly caused any
Person to engage in any short sales or similar transactions with respect to
Common Stock.
     (m) The Holders and their Affiliates (as defined in the rules promulgated
under the Securities Act) and their Associates (as defined in the rules
promulgated under the Securities Act) collectively Beneficially Own (as defined
in the Rights Agreement, dated as of March 13, 2002, between the Company and
First Union National Bank, as rights agent, as amended (the “Rights Agreement”))
and, immediately after the Closing will Beneficially Own, less than 15% of the
outstanding shares of Common Stock. No Holder or any “affiliate” or “associate”
thereof

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is or has been an “interested stockholder” (as each such term is defined in
Section 203 of the Delaware General Corporation Law).
     (n) No Holder will, after giving effect to the consummation of the
transactions contemplated by this Agreement, (i) “beneficially own” (as
determined under Rule 13d-3 under the Securities Exchange Act of 1934, as
amended (the “Exchange Act”)) 19.9% or more of the shares of Common Stock and/or
(ii) possess 19.9% or more of the voting power of the Company.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
OF THE COMPANY
     The Company agrees, represents and warrants (both as of the date of this
Agreement and as of the Closing Date) as follows:
     (a) The Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware, with full corporate power
and authority to execute and deliver this Agreement and to perform its
obligations hereunder. The Company has duly executed and delivered this
Agreement. The execution, delivery and, subject to obtaining the Stockholder
Approval, performance of this Agreement has been duly authorized by all
necessary corporate action of the Company and this Agreement constitutes a valid
and binding obligation of the Company, enforceable against it in accordance with
its terms.
     (b) The execution and delivery of this Agreement by the Company, the
performance by the Company of its obligations hereunder and the consummation of
the transactions contemplated by this Agreement by the Company do not
(a) violate, contravene or breach the certificate of incorporation or by-laws of
the Company (subject to the filing of the Charter Amendment with the Secretary
of State of the State of Delaware and obtaining the Stockholder Approval);
(b) violate, contravene or breach, or constitute a default under, any contract,
agreement, indenture or instrument to which the Company is a party or by which
any of its property or assets are bound, or to which the Company may be subject
(subject to the filing of the Charter Amendment with the Secretary of State of
the State of Delaware, the Senior Debt Satisfaction and obtaining the
Stockholder Approval); or (c) violate, contravene or breach any statute or law
or any judgment, decree, order, regulation, or rule of any court of governmental
authority applicable to the Company (subject to obtaining the Stockholder
Approval).
     (c) Subject to the filing of the Charter Amendment with the Secretary of
State of the State of Delaware, and obtaining the Stockholder Approval, (i) the
Securities will be duly authorized, (ii) upon issuance in accordance with the
terms of this Agreement, the Shares will be validly issued, fully paid and
non-assessable and will not be subject to preemptive rights or other similar
rights of stockholders of the Company, (iii) upon issuance in accordance with
the terms of the Warrants, the Warrant Shares will be validly issued, fully paid
and non-assessable and will not be subject to preemptive rights or other similar
rights of stockholders of the Company and (iv) assuming the representations and
warranties of the Holders set forth in Article II are true and correct, the
offer and issuance by the Company of the Warrants and the Shares in exchange for
the Holder Notes is exempt from the registration requirements of the Securities
Act pursuant to Section 4(2) thereof.
     (d) The Company is not required to obtain any consent, authorization or
order of, or make any filing or registration with, any court or governmental
agency or any regulatory or self regulatory agency in order for it to execute,
deliver or perform its obligations hereunder or under the Warrants in accordance
with the terms hereof or thereof, or to issue and sell the Shares and Warrants
(and the Warrant Shares) in accordance with the terms hereof, other than such as
have been made or obtained, and except for the registration of the Warrant
Shares and the Shares under the Securities Act pursuant to Article V to the
extent required hereby, any filings required to be made under federal and state
securities laws, any required filings or notifications regarding the issuance or
listing of additional shares with the NASDAQ Global Market, the filing of the
Charter Amendment with the Secretary of State of the State of Delaware and
obtaining the Stockholder Approval (if applicable).

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     (e) On the date of this Agreement, the authorized capital stock of the
Company consisted of (i) 100,000,000 shares of Common Stock, of which 65,630,051
shares were issued and outstanding, (ii) 120,000 shares of Series A Convertible
Preferred Stock, $0.01 par value per share, none of which were issued or
outstanding, (iii) 150,000 shares of Series B Convertible Preferred Stock, $0.01
par value per share, of which 130 shares were issued and outstanding, (iv) 6,660
shares of Series C Convertible Preferred Stock, $0.01 par value per share, of
which 600 shares were issued and outstanding, (v) 100,000 shares of Series D
Junior Participating Preferred Stock, $0.01 par value per share, none of which
were issued or outstanding and (vi) 100,000 shares of Series E Convertible
Preferred Stock, $0.01 par value per share, of which 59,000 shares were issued
and outstanding (clauses (ii) through (vi), collectively, the “Preferred
Stock”). On the date of this Agreement, all of the issued and outstanding shares
of Common Stock and Preferred Stock have been duly authorized, validly issued
and are fully paid and nonassessable. On the date of this Agreement, options to
purchase an aggregate of 5,960,304 shares of Common Stock were outstanding. On
the date of this Agreement, warrants to purchase an aggregate of 10,942,755
shares of Common Stock were outstanding. On the date of this Agreement, no
stockholder of the Company has preemptive rights with respect to the Securities
and there are no outstanding securities or obligations issued by the Company
(other than under the Note Purchase and Amendment Agreements) that are
convertible into, or exercisable or exchangeable for, any shares of Common Stock
other than (i) options granted under the Company’s stock option plans, (ii) the
Preferred Stock, (iii) the warrants and options described in this paragraph,
(iv) the Notes and (v) under the Rights Agreement.
     (f) From January 1, 2009 through the date of this Agreement, the Company
has timely filed all reports, schedules, forms, statements and other documents
required to be filed by it with the SEC pursuant to the reporting requirements
of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (all of
the foregoing filed prior to the date hereof and all exhibits included therein
and financial statements and schedules thereto and documents (other than
exhibits) incorporated by reference therein, being hereinafter referred to
herein as the “SEC Documents”). As of their respective dates, the SEC Documents
complied as to form in all material respects with the requirements of the
Exchange Act and the rules and regulations of the SEC promulgated thereunder
applicable to the SEC Documents, and included, to the extent required, detailed
descriptions of material indebtedness for borrowed money, and, except as
otherwise disclosed therein, none of the SEC Documents, at the time they were
filed with the SEC, contained any untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not misleading. The financial statements included in the SEC Documents and
the related notes have been prepared in accordance with accounting principles
generally accepted in the United States, consistently applied, during the
periods involved (except (i) as may be otherwise indicated in such financial
statements or the notes thereto, or (ii) in the case of unaudited interim
statements, to the extent they may not include footnotes, may be condensed or
summary statements or may otherwise conform to the SEC’s rules and instructions
for Reports on Form 10-Q) and fairly present in all material respects the
consolidated financial position of the Company as of the dates thereof and the
consolidated results of its operations and cash flows for the periods then ended
(subject, in the case of unaudited statements, to normal and recurring year-end
audit adjustments).

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     (g) As of the date hereof, the issued and outstanding shares of Common
Stock are listed on NASDAQ Global Market.
     (h) The Company has received written consents from the holders of at least
75% of the outstanding principal amount of the Notes to the Amendment, and such
holders have entered into agreements with the Company to sell their Notes to the
Company for the same purchase price per $1.00 of principal amount of Notes as
the Holders.
     (i) The Company will have at the Closing sufficient cash, available lines
of credit or other sources of immediately available funds to enable it to (i) to
make payment of the Cash Consideration and (ii) consummate the Senior Debt
Satisfaction.
     (j) The Company is not, and has never been, an “issuer” of the type defined
in Rule 144(i)(1) under the Securities Act.
ARTICLE IV
COVENANTS
     4.1 No Transfer or Conversion. Each Holder agrees that from the date hereof
until the earlier of the termination of this Agreement (in accordance with the
terms hereof) or the Closing that it will not (x) Transfer any Holder Note owned
thereby (or any portion thereof) (other than to the Company at the Closing) or
(y) exercise any right to convert the Note (or any portion thereof) into any
other security. A pledge of the Holder Notes in connection with a bona fide
margin agreement or other loan financing arrangement that is secured by the
Holder Notes shall not be deemed to be a Transfer of the Holder Notes so long as
the pledge does not prohibit the Holder’s ability to deliver the Holder Notes at
the Closing; provided, further, that any pledgee or other party that becomes the
owner of Holder Notes as a result of exercising remedies with respect to such
pledge shall have agreed, prior to exercising any such remedies, to and be
obligated to comply with this Agreement (as if it were a Holder).
     4.2 Release. From and after the Closing, each Holder agrees that all
obligations of the Company arising under or in respect of the Holder Notes will
have been satisfied and discharged and irrevocably waived in full.
     4.3 Reporting Status; Listing Obligation. The Common Stock is registered
under Section 12 of the Exchange Act. The Company covenants only to each
Affiliate Holder that during the period in which the registration statement
filed pursuant to Article V hereto remains effective, the Company agrees to use
commercially reasonable efforts to timely file (or obtain extensions in respect
thereof and file within the applicable grace period) with the SEC all reports
required to be filed by the Company under the Exchange Act, and the Company will
use its commercially reasonable efforts to maintain its status as an issuer
required to file reports under the Exchange Act even if the Exchange Act or the
rules and regulations thereunder would permit such termination. Until each
Holder Transfers all of the Shares and Warrant Shares, the Company shall use
commercially reasonable efforts to maintain the listing of its Common Stock on a
national stock exchange in the United States.
     4.4 Securities Laws Disclosure; Publicity. As soon as reasonably
practicable but not later than one Business Day after the date of this
Agreement, the Company shall issue a press release and shall file the Form 8-K
with the SEC, in each case announcing the signing of this Agreement, the signing
of the agreement relating to the Sale Condition and describing the terms of the
transactions contemplated hereby and thereby and including as an exhibit to the
Form 8-K the material transaction documents, in the form required by the
Exchange Act. At the time of the filing of the Form 8-K with the SEC, no Holder
shall be in possession of any material, nonpublic information received from the
Company, any of its subsidiaries or any of their respective officers, directors,
employees or agents, that is not disclosed in the Form 8-K. The Company shall
not publicly disclose the name of any Holder, or include the name of any Holder
in any filing with the SEC or any regulatory agency, without the prior written
consent of such Holder, which shall not be unreasonably withheld, except in
connection with the filing of this Agreement with the SEC, in any registration
statement contemplated by Article V (and amendments and supplements relating
thereto) filed with the SEC, in any proxy statement used by the Company in
connection with its efforts to obtain the Stockholder Approval and/or obtain the
approval of its stockholders of the transaction contemplated by Section 1.5(a)
and/or to the extent such disclosure is required by law, regulations or the
rules of any securities exchange, in which case the Company shall provide the
Holders with prior notice of such disclosure.

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     4.5 Furnishing of Information. As long as any Holder owns Securities, if
the Company is not required to file reports pursuant to the Exchange Act, the
Company will use commercially reasonable efforts to prepare and furnish to the
Holders and make publicly available in accordance with Rule 144(c) under the
Securities Act such information as is required for the Holders to sell the
Shares and the Warrant Shares under Rule 144 under the Securities Act. The
Company further covenants that it will use commercially reasonable efforts to
take such further action as any Holder of Securities may reasonably request, to
the extent required from time to time, to enable such Holder to sell the Shares
and the Warrant Shares without registration under the Securities Act within the
requirements of the exemption provided by Rule 144 under the Securities Act.
     4.6 Reservation of Shares. So long as any Holder owns any Warrants, the
Company shall take all action necessary to at all times have authorized, and
reserved for the purpose of issuance, no less than 100% of the number of shares
of Common Stock then issuable as Warrant Shares upon exercise of the Warrants
then outstanding (without taking into account any limitations on the exercise of
the Warrants set forth in the Warrants).
     4.7 Pledge of Securities. The Company will not object if the Securities are
pledged by a Holder in connection with a bona fide margin agreement or other
loan or financing arrangement that is secured by the Securities. The pledge of
Securities shall not be deemed to be a Transfer of the Securities hereunder or
under the Warrants, and no Holder effecting a pledge of Securities shall be
required to provide the Company with any notice thereof or otherwise make any
delivery to the Company pursuant to this Agreement, including, without
limitation, Section 2(i) hereof; provided, that, a Holder and its pledgee shall
be required to comply with the provisions of Section 2(i) hereof in order to
effect a Transfer of the Securities to such pledgee. The Company hereby agrees
to execute and deliver such documentation as a pledgee of the Securities may
reasonably request in connection with an acknowledgement of a pledge of the
Securities to such pledgee by a Holder.
     4.8 Holding. For the purposes of Rule 144(d) under the Securities Act, the
Company acknowledges that, the holding period of the Shares and the Warrants may
be “tacked” onto the holding period of the Holder Notes. The Company agrees not
to take a position contrary to that set forth in the preceding sentence. Subject
to Section 2(i) hereof and a Holder delivering to the Company the Certificate at
any time reasonably requested by the Company, the Company agrees to take all
commercially reasonable actions, including, without limitation, the issuance by
its legal counsel (which may be its internal counsel) of any legal opinions,
necessary (i) to cause the Company’s transfer agent to issue to such Holder
certificates evidencing the Shares and the Warrants held thereby that are free
of any restrictive legends (including those set forth in Section 2(i)(iii)) and
to instruct the Company’s transfer agent for its Common Stock not to issue any
stop-order with respect to the Transfer of the Shares and Warrants held by such
Holder and (ii) upon any “cashless exercise” of the Warrants pursuant to Section
2.3 thereof, to cause the Company’s transfer agent to issue to such Holder
certificates evidencing the Warrant Shares acquired in connection with such
cashless exercise that are free of any restrictive legends (including those set
forth in Section 2(i)(iii)) and to instruct the Company’s transfer agent for its
Common Stock not to issue any stop-order with respect to the Transfer of the
Warrant Shares acquired in connection with such “cashless exercise”.
     4.9 Conditions to Closing. The parties hereto will use commercially
reasonable efforts to cause the conditions to Closing to be satisfied and the
Closing to occur as expeditiously as possible; provided, that nothing contained
herein shall obligate the Company to fulfill the Sale Condition, to consummate
the Senior Debt Satisfaction or obtain the Stockholder Approval.
     4.10 Preemptive Rights. If, during the period commencing on the day after
the Closing Date and ending forty-five (45) days after the date that the Company
publicly announces the results of the Phase III clinical trial currently being
conducted by the Company with respect to its vaginal gel product, Prochieve 8%,
to reduce the risk of preterm birth in women with a short cervix as measured by
transvaginal ultrasound in mid-pregnancy results, the Company issues (other than
in an Exempt Issuance) any shares of Common Stock for a purchase price that is
less than $2.00 per share of Common Stock or securities that are convertible
into or exercisable for shares of Common Stock for a total purchase price (which
shall include the purchase price paid for each such security plus the conversion
or exercise price payable thereunder to acquire a share of Common Stock) that is
less than $2.00 per share of Common Stock, on the date of any such issuance, the
Company will deliver to each Holder written notice thereof (the “Sale Offer”).
During the ten (10) day period following delivery of the Sale Offer, each Holder
shall have the right, exercisable by delivering written notice to the Company
(the “Exercise Notice”), to sell to the Company all or any number of the
Warrants held by such Holder (as specified in such Exercise Notice) for an
amount in cash equal to the product of (a) a fraction, the numerator of which is
equal to the number of Warrants such Holder elects to sell to the Company as
specified by such Holder in the Exercise Notice and the denominator of which is
equal to 7,750,000 and (b) $3,999,996 (the “Warrant Price”). Such Exercise
Notice shall be accompanied by the certificate representing the Warrants to be
sold by such Holder, duly endorsed for transfer (and the number of Warrants such
Holder sells to the Company under this Section 4.10 shall be cancelled and not
exercisable). If a Holder does not deliver an Exercise Notice to the Company
during such ten (10) day period, the Sale Offer for such Holder shall expire and
such Holder shall have no further rights with respect thereto. If a Holder
elects pursuant to an Exercise Notice to have the Company purchase Warrants from
such Holder, the Company shall pay the Warrant Price in cash to such Holder
within twenty (20) days after the Company receives the Exercise Notice to such
account as shall be specified in writing by such Holder by wire transfer of
immediately available funds. Notwithstanding anything to the contrary contained
herein, the Company shall not be required to purchase any Warrants under this
Section 4.10 to the extent such purchase would violate the Delaware General
Corporation Law or the board of directors of the Company reasonably determines,
after receiving advice from counsel, that it could have liability in connection
therewith under the Delaware General Corporation Law. “Exempt Issuance” shall
mean any or all of the following (a) the issuance of any shares of Common Stock
pursuant to the conversion or exercise of any options, warrants, preferred stock
or other convertible securities of the Company that are outstanding on the date
hereof and/or on the Closing Date, (b) the issuance of any (x) options,
warrants, other convertible securities or rights to purchase shares of Common
Stock (and the issuance of any shares of Common Stock pursuant thereto) or
(y) shares of Common Stock, in each case, pursuant to any of the Company’s
compensatory or stock option plans or programs or as compensation to any
officer, director, consultant, agent, advisor or employee of the Company or any
subsidiary thereof, (c) the issuance of any shares of Common Stock in connection
with the transactions described in Section 1.5(a), (d) the issuance of shares of
Common Stock and warrants under the Note Purchase and Amendment Agreements (and
the issuance of any shares of Common Stock under such warrants), the issuance of
any securities pursuant to the Rights Plan (and the issuance of any securities
underlying such securities) and (f) the issuance of any warrants to purchase
shares of Common Stock (and the issuance of any shares of Common Stock
thereunder) pursuant to any agreement that the Company is a party to as of the
date hereof.
     4.11 Ownership Cap. Each Holder agrees that from the date hereof until the
earlier of the termination of this Agreement and/or the Closing (and after
giving effect to the consummation of the transactions contemplated by this
Agreement) that it will not (i) “beneficially own” (as determined under Rule
13d-3 under the Exchange Act) 19.9% or more of the shares of Common Stock and/or
(ii) possess 19.9% or more of the voting power of the Company.

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ARTICLE V
REGISTRATION RIGHTS
     The Company will use commercially reasonable efforts to file, as soon as
reasonably practicable after the Closing, but in no event later than ninety
(90) days after the Closing, a registration statement with the SEC covering the
resale of the Shares and the Warrant Shares that are issued or issuable
hereunder or under the Warrants to an Affiliate Holder. For the avoidance of
doubt, the Shares issued to and the Warrant Shares issuable under the Warrants
to any Holder that is not an Affiliate Holder shall not be covered by such
registration statement. Reference is made to Section 6 of the SPA. The Company
and each Affiliate Holder agrees that the terms, conditions and provisions of
such Section 6 are hereby incorporated herein by this reference and shall apply,
mutatis mutandis, to the Shares and the Warrant Shares issued or issuable to an
Affiliate Holder (and not to the Warrants) and such Shares and Warrant Shares
shall be deemed to be “Registrable Securities” and the Company and each
Affiliate Holder (as if each such Affiliate Holder were a Purchaser under the
SPA) shall comply with each of the provisions thereof, except that (a) the
registration statement with respect to the resale of such Shares and Warrant
Shares shall be filed with the SEC no later than ninety (90) days after the
Closing Date (as defined herein) (and the definition of “Filing Date” in the SPA
shall be deemed to be modified to reflect the foregoing), (b) the “Effectiveness
Deadline” shall mean the date which is two hundred seventy (270) calendar days
after the Closing Date (as defined herein) (and the definition of “Effectiveness
Deadline” in the SPA shall be deemed to be modified to reflect the foregoing)
and (c) Section 6.4 of the SPA shall be deemed to be modified so that (x) the
amount that the Company shall be obligated to pay to any Affiliate Holder during
a “Non-Liquidity Payment Period” (as defined in the SPA) and during which a
“Registration Default” (as defined in the SPA) remains uncured, shall be such
Affiliate Holder’s Warrant Percentage (as set forth across from such Affiliate
Holder’s name on Schedule I) multiplied by $50,000 (and, notwithstanding
anything to the contrary in the SPA, such amount may not be modified without the
prior written consent of the Company) and (y) the maximum aggregate amount that
the Company shall be required to pay to the Purchasers (as defined in
Section 7.10) under this Agreement and the Other Purchase Agreements (as defined
in Section 7.10) in respect of “Registration Defaults” (i.e., amounts payable
under Section 6.4 of the SPA) shall be equal to the product of $250,000 and the
sum of all of the “Warrant Percentages” of the Affiliate Holders as set forth on
each Schedule I to each of the Note Purchase and Amendment Agreements (and,
notwithstanding anything to the contrary in the SPA, such amount may not be
modified without the prior written consent of the Company). For the avoidance of
doubt, the reference to the Closing Date in Section 6.5(a) of the SPA shall be
deemed to be a reference to the Closing Date of this Agreement.
ARTICLE VI
TERMINATION
     6.1 Termination. This Agreement may be terminated prior to the Closing:
     (a) at any time by mutual written consent of all of the parties hereto;
     (b) by any party hereto, by delivery of written notice of termination to
the others, if the Closing has failed to occur on or before August 31, 2010;
provided, that such failure is not due to (x) the failure of the Company to
comply in all material respects with its obligations under this Agreement if the
Company is the party seeking to terminate this Agreement pursuant to this
Section 6.1(b) or (y) the failure of any Holder to comply in all material
respects with its obligations under this Agreement if any Holder is the party
seeking to terminate this Agreement pursuant to this Section 6.1(b); or
     (c) by any party hereto, by delivery of written notice of termination to
the others, if any governmental authority (including a court) of competent
jurisdiction shall have issued an order, decree or ruling, or taken any other
action, permanently restraining, enjoining or otherwise prohibiting the
transactions contemplated by this Agreement (including the Amendment) and such
order, decree, ruling or other action shall have become final and
non-appealable; provided, that in order for any party to seek to terminate this
Agreement pursuant to this Section 6.1(c) it

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must have used its commercially reasonable efforts to lift and rescind such
order, decree, ruling or other action.
     6.2 Effect of Termination. Upon termination of this Agreement pursuant to
Section 6.1, this Agreement shall forthwith become null and void and there shall
be no liability or obligation of any party hereto arising hereunder, except that
the provisions of this Article VI and Articles VII and VIII shall survive any
termination of this Agreement and any party that has willfully breached this
Agreement shall have liability to the others therefor. On the date of any
termination of this Agreement, the Holders’ consents to the Amendment will
terminate as of the date of the termination of this Agreement and be of no
further force and effect as of such date.
ARTICLE VII
MISCELLANEOUS
     7.1 Governing Law; Jurisdiction; Service of Process; No Jury Trial. This
Agreement will be governed by and interpreted in accordance with the laws of the
State of New York without regard to the principles of conflict of laws. Each
party hereby irrevocably submits to the exclusive jurisdiction of the state and
federal courts sitting in The City of New York, Borough of Manhattan, for the
adjudication of any dispute hereunder or in connection herewith or with any
transactions contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is brought in an inconvenient forum or that the
venue of such suit, action or proceeding is improper. Each party hereby
irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by mailing a copy thereof to such
party at the address for such notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY
WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE
ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF
THIS AGREEMENT OR ANY TRANSACTIONS CONTEMPLATED HEREBY.
     7.2 Specific Performance. The parties acknowledge that the subject matter
of this Agreement is unique and that no adequate remedy of law would be
available for breach of this Agreement by any party. Accordingly, the Company
and each Holder agree that each party hereto shall be entitled to an appropriate
decree of specific performance or other equitable remedies to enforce this
Agreement (without any bond or other security being required), and the Company
and each Holder hereby waives the defense in any action or proceeding brought to
enforce this Agreement that there exists an adequate remedy at law.
     7.3 Expenses. Each party shall bear its own expenses incident to the
preparation, negotiation, execution and delivery of this Agreement; provided,
that the Company will pay the reasonable out-of-pocket and reasonably documented
attorneys’ fees and expenses actually incurred by the Holders in connection with
the negotiation, execution and delivery of this Agreement not to exceed, in the
aggregate, the amount set forth on Schedule I across from the caption “Expenses
Cap”.

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     7.4 Further Assurances. Each party will do and perform, or cause to be done
and performed, all such further acts and things, and will execute and deliver
all other agreements, certificates, instruments and documents, as another party
may reasonably request in order to carry out the intent and accomplish the
purposes of this Agreement and the consummation of the transactions contemplated
hereby.
     7.5 Parties In Interest. This Agreement shall be binding upon and inure
solely to the benefit of the parties hereto, and nothing in this Agreement,
express or implied, is intended to confer upon any other Person any rights or
remedies of any nature whatsoever under or by reason of this Agreement.
References herein to “parties” or “parties hereto” are to the signatories of
this Agreement.
     7.6 Assignment. No party hereto may assign this Agreement or any of its
rights arising hereunder, in whole or in part, to any other Person; provided,
however, that any Holder may, after the Closing, assign its rights under
Sections 4.3, 4.5, 4.7 and Article V hereunder to any transferee of the
Securities (and such transferee will be deemed to be a Holder for purposes of
such Sections); provided, further, that any such transferee executes and
delivers to the Company a joinder to this Agreement, in form and substance
reasonably satisfactory to the Company, agreeing to be bound by the provisions
hereof (and those incorporated herein) as if it were a “Holder”.
     7.7 Survival. Notwithstanding any investigation made by any party to this
Agreement, all representations, warranties, covenants and agreements made in
this Agreement shall survive any investigation made by the Company or any Holder
and the Closing.
     7.8 Severability. If any provision of this Agreement is invalid or
unenforceable under any applicable statute or rule of law, then such provision
will be deemed modified in order to conform with such statute or rule of law.
Any provision hereof that may prove invalid or unenforceable under any statute
or rule of law will not affect the validity or enforceability of any other
provision hereof.
     7.9 Independent Nature of Holders’ Obligations and Rights. The obligations
of a Holder under this Agreement are several and not joint with the obligations
of any other Holder, and no Holder shall be responsible in any way for the
performance of the obligations of any other Holder under this Agreement. Nothing
contained herein and no action taken by any Holder pursuant hereto, shall be
deemed to constitute the Holders as a partnership, an association, a joint
venture or any other kind of entity, or create a presumption that the Holders
are in any way acting in concert or as a group, or are deemed affiliates (as
such term is defined under the Exchange Act) with respect to such obligations or
the transactions contemplated by this Agreement. Each Holder shall be entitled
to independently protect and enforce its rights, including without limitation
the rights arising out of this Agreement, and it shall not be necessary for any
other Holder to be joined as an additional party in any proceeding for such
purpose.
     7.10 Exclusive Agreement; Amendment; Waivers. This Agreement supersedes all
prior agreements among the parties with respect to its subject matter, is
(together with the Exhibits and Schedule hereto and any “side letters” entered
into as of the date hereof between the Company and any Holder) intended as a
complete and exclusive statement of the terms of the agreement

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among the parties with respect thereto. This Agreement cannot be waived,
amended, changed or terminated except by a written instrument executed by the
Company and the “Purchasers” (as defined below) that would be entitled to
receive a “Majority of the Warrants” (as defined below) at the closings under
all of the Note Purchase and Amendment Agreements (as defined below); provided,
however, that to the extent that such waiver, amendment or modification made
after the date of this Agreement adversely affects a particular Purchaser,
decreases the Purchase Price or alters the relative proportion of the Cash
Consideration, the Shares and the Warrant consideration, such waiver, amendment
or modification shall not be effective against such Purchaser without the
consent of such Purchaser; provided further, that any waiver, amendment or
modification made after the date of this Agreement that has the effect of
providing for additional conditions to Closing shall require the consent of the
Company and the Purchasers that would be entitled to receive a Supermajority of
the Warrants at the closings under all of the Note Purchase and Amendment
Agreements. The failure of a party to insist upon strict adherence to any term
of this Agreement on any occasion shall not be considered a waiver or deprive
that party of the right thereafter to insist upon strict adherence to that term
or any other term of this Agreement. Any waiver must be in writing and signed by
the party providing the waiver (either the Company or the requisite Purchasers).
On or after the date hereof, the Company expects to enter into one or more note
purchase and amendment agreements on substantially similar terms to this
Agreement with (some or all of) the other holders of the Notes (the “Other
Purchase Agreements” and together with this Agreement, the “Note Purchase and
Amendment Agreements”). For purposes of this Section 7.10, (a) “Purchasers”
shall mean the parties (including the Holders) that execute the Note Purchase
and Amendment Agreements other than the Company and “Majority of the Warrants”
shall mean warrants to be issued by the Company at the closings under the Note
Purchase and Amendment Agreements that would entitle the Purchasers to acquire
at least 50.1% of the total number of shares of Common Stock purchasable under
such warrants on the date such warrants are initially issued (without regard to
any provisions in such warrants which limit the ability of a Purchaser to
exercise any such warrants). “Supermajority of the Warrants” shall mean warrants
to be issued by the Company at the closings under the Note Purchase and
Amendment Agreements that would entitle the Purchasers to acquire at least 66
2/3% of the total number of shares of Common Stock purchasable under such
warrants on the date such warrants are initially issued (without regard to any
provisions in such warrants which limit the ability of a Purchaser to exercise
any such warrants). The parties hereto acknowledge and agree that the Company
has or may enter into side letters with certain Purchasers relating to the
subject matter of this Agreement.
     7.11 Counterparts; Signatures by Facsimile; Captions. This Agreement may be
executed in two or more counterparts, each of which shall be considered an
original, but all of which together shall constitute the same instrument. This
Agreement, once executed by a party, may be delivered to the other parties
hereto by facsimile transmission of a copy of this Agreement bearing the
signature of the party so delivering this Agreement. The captions in this
Agreement are for convenience of reference only and shall not be given any
effect in the interpretation of this Agreement.
     7.12 Notices. All notices, consents and other communications under this
Agreement shall be in writing and shall be deemed to have been duly given when
(a) delivered by hand, (b) sent by telecopier (with receipt confirmed), provided
that a copy is mailed by registered or certified mail, return receipt requested,
or (c) when received by the addressee, if sent by Express

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Mail, Federal Express or other express delivery service (receipt requested), in
each case to the appropriate addresses and telecopier numbers set forth below,
in the case of the Company or on Schedule I, in the case of any Holder (or to
such other addresses and telecopier numbers as a party may designate as to
itself by notice to the other parties):
If to the Company:
Columbia Laboratories, Inc.
354 Eisenhower Parkway
Livingston, New Jersey 07039
Attention: Lawrence A. Gyenes
Senior Vice President, Chief Financial Officer & Treasurer
Telephone: (973) 486-8860
Telecopier: (866) 994-3001
with a copy to:
Kaye Scholer LLP
425 Park Avenue
New York, New York 10022
Attention: Adam H. Golden, Esq.
and Steven G. Canner, Esq.
Telephone: (212) 836-8030
Telecopier: (212) 836-8689
ARTICLE VIII
DEFINITIONS
     8.1 As used in this Agreement, the following terms have the meanings
specified or referred to in this Article VIII.
     “Affiliate Holder” means any Holder that is an “affiliate” (as such term is
defined under Rule 405 of the Securities Act) of the Company on the Closing
Date.
     “Business Day” — Any day that is not a Saturday or Sunday or other day on
which commercial banks in The City of New York are authorized or required by law
to remain closed.
     “Encumbrance” — Any security interest, mortgage, lien, charge, adverse
claim or restriction of any kind, including, but not limited to, any restriction
on the use, voting, transfer, receipt of income or other exercise of any
attributes of ownership, except for restrictions on the Transfer of securities
under the terms of the Warrant, this Agreement, the Securities Act, and the
rules and regulations of the SEC thereunder and restrictions imposed by the
“Blue Sky” laws of any jurisdiction that do not interfere with the purchase and
sale of the Notes contemplated hereby.
     “Material Adverse Effect” means a material adverse effect on the business,
properties, assets, operations, results of operations, condition (financial or
otherwise) of the Company and its subsidiaries, taken as a whole, or on the
transactions contemplated hereby.
     “Person” — Any individual, corporation, partnership, limited liability
company, joint venture, trust, association, unincorporated organization, other
entity, or governmental body.
[Remainder of this page intentionally left blank.]

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            COLUMBIA LABORATORIES, INC.
      By:   /s/ Lawrence A. Gyenes       Name:   Lawrence A. Gyenes      
Title:   Senior Vice President, Chief Financial Officer and Treasurer      
PERRY PARTNERS INTERNATIONAL INC.

By: Perry Corp., Investment Manager of Perry Partners International, Inc.
      By:   /s/ Michael C. Neus         Name:   Michael C. Neus        Title:  
General Counsel        PERRY PARTNERS, L.P.

By: Perry Corp., General Partner of Perry Partners L.P.
      By:   /s/ Michael C. Neus         Name:   Michael C. Neus        Title:  
General Counsel     

[Signature page to Note Purchase and Amendment Agreement]

 

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EXHIBIT A
[THIS WARRANT AND THE UNDERLYING SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES. THESE SECURITIES MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED,
HYPOTHECATED, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES UNDER APPLICABLE SECURITIES LAWS OR
UNLESS OFFERED, SOLD, PLEDGED, HYPOTHECATED OR TRANSFERRED PURSUANT TO AN
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THOSE LAWS. COLUMBIA
LABORATORIES, INC. SHALL BE ENTITLED TO REQUIRE AN OPINION OF COUNSEL
SATISFACTORY TO COLUMBIA LABORATORIES, INC. THAT SUCH REGISTRATION IS NOT
REQUIRED TO THE EXTENT THAT AN OPINION IS REQUIRED PURSUANT TO THE AGREEMENT
UNDER WHICH THESE SECURITIES WERE ISSUED.]1
COLUMBIA LABORATORIES, INC.
WARRANT TO PURCHASE COMMON STOCK

      No. W-                                           , 2010

Void After                     , 20152
     THIS CERTIFIES THAT, for value received,
                                        , with its principal office at
                                                            , or its permitted
assigns (the “Holder”), is entitled to subscribe for and purchase at the
Exercise Price (defined below) from Columbia Laboratories, Inc., a Delaware
corporation, with its principal office at 354 Eisenhower Parkway, Livingston,
New Jersey 07039 (the “Company”), up to                      3  shares of common
stock of the Company, $0.01 par value per share (the “Common Stock”), subject to
adjustment as provided herein. This Warrant is one of a series of substantially
similar Warrants being issued as of the date hereof (the “Issuance Date”)
pursuant to the terms of those certain Note Purchase and Amendment Agreements
(the “NPA Warrants”), dated on or after March 3, 2010, each by and among the
Company and certain other persons or entities (each a “Purchaser” and together,
the “Purchasers”), including the original Holder of this Warrant (the “Note
Purchase Agreements” and including the Note Purchase and Amendment Agreement,
dated as of March 3, 2010, between the Company and the original Holder, the
“Note Purchase Agreement”). Capitalized terms not otherwise defined herein shall
have the respective meanings ascribed to such terms in the Note Purchase
Agreement.
 

1   Legend shall be removed if the Certificate contemplated in Section
2(i)(i)(B) of the Note Purchase Agreement has been delivered to the Company in
accordance with the terms therein (or omitted if the Certificate is delivered on
or prior to the Closing Date).   2   Insert five-year anniversary of Issuance
Date.   3   Insert applicable numbers from Schedule I to Note Purchase
Agreement.

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     1. DEFINITIONS. As used herein, the following terms shall have the
following respective meanings:
          (a) “Business Day” means any day other than Saturday, Sunday or other
day on which commercial banks in The City of New York are authorized or required
by law to remain closed.
          (b) “Closing Bid Price” and “Closing Sale Price” means, for any
security as of any date, the last closing bid price and last closing trade
price, respectively, for such security on the Principal Market, as reported by
Bloomberg, or, if the Principal Market begins to operate on an extended hours
basis and does not designate the closing bid price or the closing trade price,
as the case may be, then the last bid price or last trade price, respectively,
of such security prior to 4:00:00 p.m., New York time, as reported by Bloomberg,
or, if the Principal Market is not the principal securities exchange or trading
market for such security, the last closing bid price or last trade price,
respectively, of such security on the principal securities exchange or trading
market where such security is listed or traded as reported by Bloomberg, or if
the foregoing do not apply, the last closing bid price or last trade price,
respectively, of such security in the over-the-counter market on the electronic
bulletin board for such security as reported by Bloomberg, or, if no closing bid
price or last trade price, respectively, is reported for such security by
Bloomberg, the average of the bid prices, or the ask prices, respectively, of
any market makers for such security as reported in the “pink sheets” by Pink
Sheets LLC (formerly the National Quotation Bureau, Inc.). If the Closing Bid
Price or the Closing Sale Price cannot be calculated for a security on a
particular date on any of the foregoing bases, the Closing Bid Price or the
Closing Sale Price, as the case may be, of such security on such date shall be
the fair market value as mutually determined by the Company and the Holder. All
such determinations to be appropriately adjusted for any stock dividend, stock
split, stock combination or other similar transaction during the applicable
calculation period.
          (c) “Exercise Period” shall mean the period commencing 180 days after
the date hereof and ending at 5:00 p.m., New York time, on                     ,
20154, unless sooner exercised or terminated as provided below.
          (d) “Exercise Price” shall mean $1.35, subject to adjustment pursuant
to Section 5 below.
          (e) “Exercise Shares” shall mean the shares of the Common Stock issued
upon exercise of this Warrant, subject to adjustment pursuant to the terms
herein, including but not limited to adjustment pursuant to Section 5 below.
          (f) “Principal Market” means the principal securities exchange or
securities market on which the Common Stock is then traded.
          (g) “Trading Day” means any day on which the Common Stock is traded on
the Principal Market; provided that “Trading Day” shall not include any day on
which the Common Stock is scheduled to trade on such exchange or market for less
than 4.5 hours or any
 

4   Insert five-year anniversary of Issuance Date.  

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day that the Common Stock is suspended from trading during the final hour of
trading on such exchange or market (or if such exchange or market does not
designate in advance the closing time of trading on such exchange or market,
then during the hour ending at 4:00:00 p.m., New York Time).
     2. EXERCISE OF WARRANT.
          2.1 Method of Exercise. Subject to the terms and conditions hereof
(including, without limitation, the limitations set forth in Section 2.5), this
Warrant may be exercised by the Holder at any time during the Exercise Period,
in whole or in part, by (i) delivery of a written notice, in the form attached
hereto as Exhibit A (the “Exercise Notice”), of the Holder’s election to
exercise this Warrant to the Company and (ii) (A) payment to the Company of an
amount equal to the applicable Exercise Price multiplied by the number of shares
of Common Stock as to which this Warrant is being exercised (the “Aggregate
Exercise Price”) in cash or by wire transfer of immediately available funds or
(B) by notifying the Company that this Warrant is being exercised pursuant to a
Cashless Exercise (as defined in Section 2.3). The Holder shall not be required
to deliver the original Warrant in order to effect an exercise hereunder.
Execution and delivery of the Exercise Notice with respect to less than all of
the Common Stock shall have the same effect as cancellation of the original
Warrant and issuance of a new Warrant evidencing the right to purchase the
remaining number of Exercise Shares. On or before the first Business Day
following the date on which the Company has received each of the Exercise Notice
and the Aggregate Exercise Price (or notice of a Cashless Exercise) (the
“Exercise Delivery Documents”), the Company shall transmit by facsimile an
acknowledgment of confirmation of receipt of the Exercise Delivery Documents to
the Holder and the Company’s transfer agent (the “Transfer Agent”). On or before
the third Business Day following the date on which the Company has received all
of the Exercise Delivery Documents (the “Share Delivery Date”), the Company
shall (X) provided that the Transfer Agent is participating in The Depository
Trust Company (“DTC”) Fast Automated Securities Transfer Program, upon the
request of the Holder, credit such aggregate number of Exercise Shares to which
the Holder is entitled pursuant to such exercise to the Holder’s or its
designee’s balance account with DTC through its Deposit Withdrawal Agent
Commission system, or (Y) if the Transfer Agent is not participating in the DTC
Fast Automated Securities Transfer Program, issue and dispatch by overnight
courier to the address as specified in the Exercise Notice, a certificate,
registered in the Company’s share register in the name of the Holder or its
designee, for the number of Exercise Shares to which the Holder is entitled
pursuant to such exercise which certificates shall not bear any restrictive
legends unless required pursuant to the Note Purchase Agreement or the Company
places (or cauces to be placed) a restrictive legend thereon in accordance with
Section 4.3(b) hereof. Upon delivery of the Exercise Delivery Documents, the
Holder shall be deemed for all corporate purposes to have become the holder of
record of the Exercise Shares with respect to which this Warrant has been
exercised, irrespective of the date such Exercise Shares are credited to the
Holder’s DTC account or the date of delivery of the certificates evidencing such
Exercise Shares as the case may be. If this Warrant is submitted in connection
with any exercise pursuant to this Section 2.1 and the number of Exercise Shares
represented by this Warrant submitted for exercise is greater than the number of
Exercise Shares being acquired upon an exercise, then the Company shall as soon
as practicable and in no event later than three Business Days after any exercise
and at its own expense, issue a new Warrant (in accordance with Section 2.4)
representing the right to purchase the number of Exercise Shares purchasable
immediately prior to such exercise under this Warrant, less the number of
Exercise Shares with respect to which this Warrant is exercised. No fractional
shares of Common Stock are to be issued upon the exercise of this Warrant.

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Fractional shares shall be treated as provided in Section 6. The Company shall
pay any and all taxes which may be payable with respect to the issuance and
delivery of Exercise Shares upon exercise of this Warrant.
          2.2 Company’s Failure to Timely Deliver Securities. If within three
Trading Days after the Company’s receipt of the facsimile copy of a Exercise
Notice the Company shall fail to issue and deliver a certificate to the Holder
and register such Exercise Shares on the Company’s share register or credit the
Holder’s balance account with DTC for the number of Exercise Shares to which the
Holder is entitled upon such Holder’s exercise hereunder or if the Company fails
to deliver to the Holder the certificate or certificates representing the
applicable Exercise Shares (or credit the Holder’s balance account at DTC with
the applicable Exercise Shares) within three Trading Days after its obligation
to do so under clause (ii) below and if on or after such Trading Day the Holder
purchases (in an open market transaction or otherwise) shares of Common Stock to
deliver in satisfaction of a sale by the Holder of Exercise Shares issuable upon
such exercise that the Holder anticipated receiving from the Company (a
“Buy-In”), then the Company shall, within three Business Days after the Holder’s
request and in the Holder’s discretion, either (i) pay cash to the Holder in an
amount equal to the Holder’s total purchase price (including brokerage
commissions, if any) for the shares of Common Stock so purchased (the “Buy-In
Price”), at which point the Company’s obligation to deliver such certificate
(and to issue such Exercise Shares) or credit such Holder’s balance account with
DTC shall terminate, or (ii) promptly honor its obligation to deliver to the
Holder a certificate or certificates representing such Exercise Shares or credit
such Holder’s balance account with DTC and pay cash to the Holder in an amount
equal to the excess (if any) of the Buy-In Price over the product of (A) such
number of Exercise Shares, times (B) the Closing Bid Price on the date of
exercise.
          2.3 Cashless Exercise. Notwithstanding any provisions herein to the
contrary, if, at any time during the Exercise Period, the Current Market Price
(as defined below) of one share of Common Stock is greater than the Exercise
Price (at the date of calculation as set forth below), in lieu of exercising
this Warrant by payment of cash, the Holder may exercise this Warrant by a
cashless exercise by surrender of this Warrant at the principal office of the
Company together with the properly endorsed Notice of Exercise and the Company
shall issue to the Holder a number of Exercise Shares computed using the
following formula:

         
 
  X =   Y (B-A)
 
            B
 
       
Where:
  X =   the number of Exercise Shares to be issued to the Holder.
 
       
 
  Y =   the number of Exercise Shares purchasable upon exercise of all of the
Warrant or, if only a portion of the Warrant is being exercised, the portion of
the Warrant being exercised.

     A = the Exercise Price.
     B = the Current Market Price of one share of Common Stock.
     “Current Market Price” means on any particular date:

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          (a) if the Common Stock is traded on the Nasdaq Capital Market, the
Nasdaq Global Market or the Nasdaq Global Select Market (or their successors),
the average of the closing prices of the Common Stock of the Company on such
market over the five trading days ending immediately prior to the applicable
date of valuation;
          (b) if the Common Stock is traded on any registered national stock
exchange but is not traded on the Nasdaq Capital Market, the Nasdaq Global
Market or the Nasdaq Global Select Market (or their successors), the average of
the closing prices of the Common Stock of the Company on such exchange over the
five trading days ending immediately prior to the applicable date of valuation;
          (c) if the Common Stock is traded over-the-counter, but not on the
Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market
or a registered national stock exchange, the average of the closing bid prices
over the 30-day period ending immediately prior to the applicable date of
valuation; and
          (d) if there is no active public market for the Common Stock, the
value thereof, as determined in good faith by the Board of Directors of the
Company upon due consideration of the proposed determination thereof by the
Holder.
          2.4 Partial Exercise. If this Warrant is exercised in part only, the
Company shall, upon surrender of this Warrant, execute and deliver, within
10 days of the date of exercise, a new Warrant evidencing the rights of the
Holder, or, subject to Section 8, such other person as shall be designated in
the Notice of Exercise, to purchase the balance of the Exercise Shares
purchasable hereunder. In no event shall this Warrant be exercised for a
fractional Exercise Share, and the Company shall not distribute a Warrant
exercisable for a fractional Exercise Share. Fractional shares shall be treated
as provided in Section 6.
          2.5 Limitations on Exercise.
          (a) The Company shall not effect the exercise of this Warrant, and the
Holder shall not have the right to exercise this Warrant, to the extent that
after giving effect to such exercise, such Person (together with such Person’s
affiliates) would beneficially own in excess of 9.99% of the shares of Common
Stock outstanding immediately after giving effect to such exercise. For purposes
of the foregoing sentence, the aggregate number of shares of Common Stock
beneficially owned by such Person and its affiliates shall include the number of
shares of Common Stock issuable upon exercise of this Warrant with respect to
which the determination of such sentence is being made, but shall exclude shares
of Common Stock which would be issuable upon (i) exercise of the remaining,
unexercised portion of this Warrant beneficially owned by such Person and its
affiliates and (ii) exercise or conversion of the unexercised or unconverted
portion of any other securities of the Company beneficially owned by such Person
and its affiliates (including, without limitation, any convertible notes or
convertible preferred stock or warrants) subject to a limitation on conversion
or exercise analogous to the limitation contained herein. Except as set forth in
the preceding sentence, for purposes of this paragraph, beneficial ownership
shall be calculated in accordance with Section 13(d) of the Securities Exchange
Act of 1934, as amended. For purposes of this Warrant, in determining the number
of outstanding shares of Common Stock, the Holder may rely on the number of
outstanding shares of Common Stock as reflected in (1) the Company’s most recent
Form 10-K, Form 10-Q, Current Report on Form 8-K or other public filing with the
Securities and Exchange

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Commission, as the case may be, (2) a more recent public announcement by the
Company or (3) any other notice by the Company or the Transfer Agent setting
forth the number of shares of Common Stock outstanding. For any reason at any
time, upon the written request of the Holder, the Company shall within one
Business Day confirm in writing to the Holder the number of shares of Common
Stock then outstanding. In any case, the number of outstanding shares of Common
Stock shall be determined after giving effect to the conversion or exercise of
securities of the Company, including the NPA Warrants, by the Holder and its
affiliates since the date as of which such number of outstanding shares of
Common Stock was reported.
          (b) The Company shall not be obligated to issue any shares of Common
Stock upon exercise of this Warrant, if the issuance of such shares of Common
Stock would exceed that number of shares of Common Stock which the Company may
issue upon exercise, redemption or conversion, as applicable, of the NPA
Warrants or otherwise without breaching the Company’s obligations under the
rules or regulations of the applicable Principal Market (the number of shares
which may be issued without violating such rules and regulations, the “Exchange
Cap”), except that such limitation shall not apply in the event that the Company
(A) obtains the approval of its stockholders as required by the applicable rules
of the applicable Principal Market for issuances of shares of Common Stock in
excess of such amount or (B) obtains a written opinion from outside counsel to
the Company that such approval is not required, which opinion shall be
reasonably satisfactory to the Holders. Unless and until such approval or
written opinion is obtained, no Holder shall be issued in the aggregate, upon
exercise or conversion, as applicable, of any NPA Warrants, shares of Common
Stock in an amount greater than the product of the Exchange Cap multiplied by a
fraction, the numerator of which is the total number of shares of Common Stock
underlying the NPA Warrants issued to such Holder pursuant to the Note Purchase
Agreements on the Issuance Date and the denominator of which is the aggregate
number of shares of Common Stock underlying the NPA Warrants issued to the
Purchasers pursuant to the Note Purchase Agreements on the Issuance Date (with
respect to each Purchaser, the “Exchange Cap Allocation”). In the event that any
Holder shall sell or otherwise transfer any of such Holder’s NPA Warrants, the
transferee shall be allocated a pro rata portion of such Holder’s Exchange Cap
Allocation, and the restrictions of the prior sentence shall apply to such
transferee with respect to the portion of the Exchange Cap Allocation allocated
to such transferee. In the event that any Holder of NPA Warrants shall exercise
all of such Holder’s NPA Warrants into a number of shares of Common Stock which,
in the aggregate, is less than such Holder’s Exchange Cap Allocation, then the
difference between such Holder’s Exchange Cap Allocation and the number of
shares of Common Stock actually issued to such Holder shall be allocated to the
respective Exchange Cap Allocations of the remaining holders of NPA Warrants on
a pro rata basis in proportion to the shares of Common Stock underlying the NPA
Warrants then held by each such holder. In the event that the Company is
prohibited from issuing any Warrant Shares for which an Exercise Notice has been
received as a result of the operation of this Section 2.5(b), the Company shall
pay cash in exchange for cancellation of such Warrant Shares, at a price per
Warrant Share equal to the difference between the Closing Sale Price and the
Exercise Price as of the date of the attempted exercise.
          2.6 Insufficient Authorized Shares. If at any time while any of the
Warrants remain outstanding the Company does not have a sufficient number of
authorized and unreserved shares of Common Stock to satisfy its obligation to
reserve for issuance upon exercise of the Warrants at least a number of shares
of Common Stock equal to 100% of the number of shares of Common Stock as shall
from time to time be necessary to effect the exercise of all of the

A-6

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Warrants then outstanding (the “Required Reserve Amount”) (such event an
“Authorized Share Failure”), then the Company shall immediately take all action
necessary to increase the Company’s authorized shares of Common Stock to an
amount sufficient to allow the Company to reserve the Required Reserve Amount
for the Warrants then outstanding. Without limiting the generality of the
foregoing sentence, as soon as practicable after the date of the occurrence of
an Authorized Share Failure, but in no event later than 90 days after the
occurrence of such Authorized Share Failure, the Company shall hold a meeting of
its stockholders for the approval of an increase in the number of authorized
shares of Common Stock. In connection with such meeting, the Company shall
provide each stockholder with a proxy statement and shall use its best efforts
to solicit its stockholders’ approval of such increase in authorized shares of
Common Stock and to cause its board of directors to recommend to the
stockholders that they approve such proposal.
     3. COVENANTS OF THE COMPANY.
          3.1 Covenants as to Exercise Shares. The Company covenants and agrees
that all Exercise Shares that may be issued upon the exercise of the rights
represented by this Warrant will, upon issuance, be validly issued and
outstanding, fully paid and nonassessable, and free from all taxes, liens and
charges with respect to the issuance thereof. The Company further covenants and
agrees that the Company will at all times during the Exercise Period have
authorized and reserved, free from preemptive rights, a sufficient number of
shares of its Common Stock to provide for the exercise of the rights represented
by this Warrant. If at any time during the Exercise Period the number of
authorized but unissued shares of Common Stock shall not be sufficient to permit
exercise of this Warrant, the Company will take such corporate action as may, in
the opinion of its counsel, be necessary to increase its authorized but unissued
shares of Common Stock (or other securities as provided herein) to such number
of shares as shall be sufficient for such purposes.
          3.2 Notices of Record Date. In the event of any taking by the Company
of a record of the holders of any class of securities for the purpose of
determining the holders thereof who are entitled to receive any dividend (other
than a cash dividend which is the same as cash dividends paid in previous
quarters) or other distribution, the Company shall mail to the Holder, at least
ten days prior to the date specified herein, a notice specifying the date on
which any such record is to be taken for the purpose of such dividend or
distribution.
     4. REPRESENTATIONS OF HOLDER.
          4.1 Acquisition of Warrant for Personal Account. The Holder represents
and warrants that it is acquiring the Warrant and the Exercise Shares solely for
its account for investment and not with a present view toward the public sale or
distribution of said Warrant or Exercise Shares or any part thereof and has no
present intention of selling or distributing said Warrant or Exercise Shares or
any arrangement or understanding with any other persons regarding the sale or
distribution of said Warrant or, except in accordance with the provisions of
Article V of the Note Purchase Agreement, if applicable, the Exercise Shares,
and except as would not result in a violation of the Securities Act of 1933, as
amended. The Holder will not, directly or indirectly, offer, sell, pledge,
transfer or otherwise dispose of (or solicit any offers to buy, purchase or
otherwise acquire or take a pledge of) the Warrant except in accordance with the
Securities Act of 1933, as amended, and will not, directly or indirectly, offer,
sell, pledge, transfer or otherwise dispose of (or solicit any offers to

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buy, purchase or otherwise acquire or take a pledge of) the Exercise Shares
except in accordance with the provisions of Article V of the Note Purchase
Agreement, if applicable, or pursuant to and in accordance with the Securities
Act of 1933, as amended.
          4.2 Securities Are Not Registered.
          (a) The Holder understands that the offer and sale of the Warrant or
the Exercise Shares have not been registered under the Securities Act of 1933,
as amended, on the basis that no distribution or public offering of the
securities of the Company is to be effected and/or pursuant to specific
exemptions from the registration provisions of the Securities Act of 1933, as
amended, which exemptions depend upon, among other things, the bona fide nature
of the Holder’s investment intent as expressed herein. The Holder realizes that
the basis for such exemptions may not be present if, notwithstanding its
representations, the Holder has a present intention of acquiring the Warrants
and/or the Exercise Shares for a fixed or determinable period in the future,
selling (in connection with a distribution or otherwise), granting any
participation in, or otherwise distributing the Warrants and/or the Exercise
Shares. The Holder represents and warrants that it has no such present
intention.
          (b) The Holder recognizes that the Warrant and the Exercise Shares
must be held indefinitely unless they are subsequently registered under the
Securities Act of 1933, as amended, or an exemption from such registration is
available. The Holder recognizes that the Company has no obligation to register
the Warrant or, except as provided in the Note Purchase Agreement, if
applicable, the Exercise Shares, or to comply with any exemption from such
registration.
          4.3 Disposition of Warrant and Exercise Shares.
          (a) The Holder further agrees not to make any disposition of all or
any part of the Warrant or Exercise Shares in any event unless and until:
          (i) There is then in effect a registration statement under the
Securities Act of 1933, as amended, covering such proposed disposition and such
disposition is made in accordance with said registration statement;
          (ii) Solely with respect to the Warrant, the Holder shall have
furnished to the Company the Certificate, after which the Holder may dispose of
such Warrant in accordance with the provisions of Rule 144 under the Securities
Act of 1933, as amended;
          (iii) Solely with respect to the Exercise Shares that the Holder
acquires pursuant to the “cashless exercise” provisions of Section 2.3 hereof,
and only if the Holder shall have furnished to the Company the Certificate at
the time of such “cashless exercise”, the Holder may dispose of such Exercise
Shares in accordance with the provisions of Rule 144 under the Securities Act of
1933, as amended; or
          (iv) If reasonably requested by the Company, the Holder shall have
furnished the Company with an opinion of counsel, reasonably satisfactory to the
Company, for the Holder to the effect that such disposition will not require
registration of such Warrant or Exercise Shares under the Securities Act of
1933, as amended, or any applicable state securities laws; provided, that no
opinion shall be required for any disposition made or to be made in accordance
with the provisions of Rule 144 under the Securities Act of 1933, as amended.
          (b) The Holder understands and agrees that all certificates evidencing
the Exercise Shares to be issued to the Holder may bear a legend in
substantially the following form (except such legend will not be placed on
Exercise Shares acquired under the Warrant pursuant to a “cashless exercise”
pursuant to Section 2.3 if immediately prior to such “cashless exercise” the
Holder provides the Certificate to the Company):
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE OF
THE UNITED STATES. THE SECURITIES MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED,
HYPOTHECATED, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES UNDER

A-8

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APPLICABLE SECURITIES LAWS, OR UNLESS OFFERED, SOLD, PLEDGED, HYPOTHECATED OR
TRANSFERRED PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THOSE LAWS. COLUMBIA LABORATORIES, INC. SHALL BE ENTITLED TO
REQUIRE AN OPINION OF COUNSEL SATISFACTORY TO COLUMBIA LABORATORIES, INC. THAT
SUCH REGISTRATION IS NOT REQUIRED TO THE EXTENT THAT AN OPINION IS REQUIRED
PURSUANT TO THE AGREEMENT UNDER WHICH THE SECURITIES WERE ISSUED.
     5. ADJUSTMENTS. In the event of changes in the outstanding Common Stock of
the Company by reason of any stock split, stock dividend, recapitalization,
reclassification, combination or exchange of shares, reorganization,
liquidation, dissolution, consolidation or merger effected by the Company, the
number and class of shares available under the Warrant in the aggregate and the
Exercise Price shall be correspondingly adjusted to give the Holder of the
Warrant, on exercise for the same aggregate Exercise Price, the total number,
class and kind of shares or other property, including cash, as the Holder would
have owned had the Warrant been exercised prior to the event and had the Holder
continued to hold such shares until after the event requiring adjustment. The
form of this Warrant need not be changed because of any adjustment in the
Exercise Price and/or number, class and kind of shares subject to this Warrant.
The Company shall promptly provide a certificate from its Chief Financial
Officer notifying the Holder in writing of any adjustment in the Exercise Price
and/or the total number, class and kind of shares issuable upon exercise of this
Warrant, which certificate shall specify the Exercise Price and number, class
and kind of shares under this Warrant after giving effect to such adjustment.
For the avoidance of doubt, if necessary to effectuate the provisions of this
paragraph 5, any successor to the Company or surviving entity in a
reorganization, consolidation or merger effected by the Company shall deliver to
the Holder confirmation (or a new warrant to the effect) that such successor or
surviving entity shall have all of the obligations of the Company under this
Warrant with the same effect as if such successor or surviving entity had been
named as the Company herein, and that there shall be issued upon exercise of
this Warrant (or a new warrant) at any time after the consummation of such
reorganization, consolidation or merger, in lieu of the shares of Common Stock
issuable upon the exercise of this Warrant prior to such transaction, the total
number, class and kind of shares or other property, including cash, as the
Holder would have owned had the Warrant been exercised prior to such transaction
and had the Holder continued to hold such shares until after such transaction.
     6. FRACTIONAL SHARES. No fractional shares shall be issued upon the
exercise of this Warrant as a consequence of any adjustment pursuant hereto. All
Exercise Shares (including fractions) issuable upon exercise of this Warrant may
be aggregated for purposes of determining whether the exercise would result in
the issuance of any fractional share. If, after aggregation, the exercise would
result in the issuance of a fractional share, the Company shall, in lieu of
issuance of any fractional share, pay the Holder otherwise entitled to such
fraction a sum in cash equal to the product resulting from multiplying the fair
market value of the Common Stock on the date of exercise of this Warrant by such
fraction.
     7. NO STOCKHOLDER RIGHTS. This Warrant in and of itself shall not entitle
the Holder to any voting rights or other rights as a stockholder of the Company.

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     8. TRANSFER OF WARRANT. Subject to applicable laws and compliance with
Section 4.3, this Warrant and all rights hereunder are transferable, by the
Holder in person or by duly authorized attorney, upon delivery of this Warrant
and the form of assignment attached hereto to any transferee designated by
Holder.
          8.1 Upon such surrender and, if required, such payment, the Company
shall execute and deliver a new Warrant or Warrants in the name of the assignee
or assignees and in the denomination or denominations specified in such
instrument of assignment, and shall issue to the assignor a new Warrant
evidencing the portion of this Warrant not so assigned, and this Warrant shall
promptly be cancelled. A Warrant, if properly assigned, may be exercised by a
new holder for the purchase of shares of Common Stock without having a new
Warrant issued.
          8.2 If, at the time of the surrender of this Warrant in connection
with any transfer of this Warrant, (i) the transfer of this Warrant shall not be
registered pursuant to an effective registration statement under the Securities
Act of 1933, as amended, and under applicable state securities or blue sky laws,
and (ii) the Holder has not furnished to the Company the Certificate at such
time, the Company may require, as a condition of allowing such transfer (A) that
the Holder or transferee of this Warrant, as the case may be, furnish to the
Company a written opinion of counsel (which opinion shall be in form, substance
and scope customary for opinions of counsel in comparable transactions) to the
effect that such transfer may be made without registration under the Securities
Act of 1933, as amended, and under applicable state securities or blue sky laws,
and (B) that the holder or transferee execute and deliver to the Company an
investment letter in form and substance acceptable to the Company; provided, in
any case that the transferee shall be an “accredited investor” as defined in
Rule 501(a)(1), (a)(2), (a)(3), (a)(7), or (a)(8) promulgated under the
Securities Act of 1933, as amended, or a “qualified institutional buyer” as
defined in Rule 144A(a) under the Securities Act of 1933, as amended.
     9. LOST, STOLEN, MUTILATED OR DESTROYED WARRANT. If this Warrant is lost,
stolen, mutilated or destroyed, the Company may, on such terms as to indemnity
or otherwise as it may reasonably impose (which shall, in the case of a
mutilated Warrant, include the surrender thereof), issue a new Warrant of like
denomination and tenor as the Warrant so lost, stolen, mutilated or destroyed.
Any such new Warrant shall constitute an original contractual obligation of the
Company, whether or not the allegedly lost, stolen, mutilated or destroyed
Warrant shall be at any time enforceable by anyone.
     10. MODIFICATIONS AND WAIVER. This Warrant and any provision hereof may be
changed, waived, discharged or terminated only by an instrument in writing
signed by the Company and (i) Purchasers holding Warrants representing at least
a majority of the number of Exercise Shares then issuable upon exercise of any
then unexercised Warrants issued pursuant to the Note Purchase Agreements,
provided, however, that such modification, amendment or waiver is made with
respect to all unexercised Warrants issued pursuant to the Note Purchase
Agreements and does not adversely affect the Holder without adversely affecting
all holders of Warrants in a similar manner; or (ii) the Holder.
     11. NOTICES, ETC. All notices required or permitted hereunder shall be in
writing and shall be deemed effectively given: (a) upon personal delivery to the
party to be notified, (b) when sent by confirmed email, telex or facsimile if
sent during normal business hours of the recipient, if not, then on the next
business day, (c) five days after having been sent by registered or certified
mail, return receipt requested, postage prepaid, or (d) one business day after
deposit

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with a nationally recognized overnight courier, specifying next day delivery,
with written verification of receipt. All communications shall be sent to the
Company at the address listed on the signature page and to the Holders at the
addresses on the Company records, or at such other address as the Company or
Holder may designate by ten days’ advance written notice to the other party
hereto.
     12. ACCEPTANCE. Receipt of this Warrant by the Holder shall constitute
acceptance of and agreement to all of the terms and conditions contained herein.
     13. GOVERNING LAW. This Warrant and all rights, obligations and liabilities
hereunder shall be governed by the laws of the State of New York without regard
to the principles of conflict of laws.
     14. DESCRIPTIVE HEADINGS. The descriptive headings of the several
paragraphs of this Warrant are inserted for convenience only and do not
constitute a part of this Warrant. The language in this Warrant shall be
construed as to its fair meaning without regard to which party drafted this
Warrant.
     15. SEVERABILITY. The invalidity or unenforceability of any provision of
this Warrant in any jurisdiction shall not affect the validity or enforceability
of such provision in any other jurisdiction, or affect any other provision of
this Warrant, which shall remain in full force and effect.
     16. ENTIRE AGREEMENT. This Warrant constitutes the entire agreement between
the parties pertaining to the subject matter contained in it and supersedes all
prior and contemporaneous agreements, representations, and undertakings of the
parties, whether oral or written, with respect to such subject matter.
     17. REMEDIES, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The
remedies provided in this Warrant shall be cumulative and in addition to all
other remedies available under this Warrant and the Note Purchase Agreements, at
law or in equity (including a decree of specific performance and/or other
injunctive relief), and nothing herein shall limit the right of the Holder right
to pursue actual damages for any failure by the Company to comply with the terms
of this Warrant. The Company acknowledges that a breach by it of its obligations
hereunder will cause irreparable harm to the Holder and that the remedy at law
for any such breach may be inadequate. The Company therefore agrees that, in the
event of any such breach or threatened breach, the holder of this Warrant shall
be entitled, in addition to all other available remedies, to an injunction
restraining any breach, without the necessity of showing economic loss and
without any bond or other security being required.
[Signature Page Follows]

A-11

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     IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by
its duly authorized officer as of ___, 2010.

            COLUMBIA LABORATORIES, INC.
      By:           Name:           Title:           Address:                  
Attention: [•]         Facsimile: [•]      

A-12

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EXERCISE NOTICE
TO BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE THIS
WARRANT TO PURCHASE COMMON STOCK
COLUMBIA LABORATORIES, INC.
     The undersigned holder hereby exercises the right to purchase
                                         of the shares of Common Stock
(“Exercise Shares”) of Columbia Laboratories, Inc., a Delaware corporation (the
“Company”), evidenced by the attached Warrant to Purchase Common Stock (the
“Warrant”). Capitalized terms used herein and not otherwise defined shall have
the respective meanings set forth in the Warrant.
     1. Form of Exercise Price. The Holder intends that payment of the Exercise
Price shall be made as:
                             a “Cash Exercise” with respect to
                     Exercise Shares; and/or
                             a “Cashless Exercise” with respect to
                     Exercise Shares.
     2. Payment of Exercise Price. In the event that the holder has elected a
Cash Exercise with respect to some or all of the Exercise Shares to be issued
pursuant hereto, the holder shall pay the Aggregate Exercise Price in the sum of
$                                         to the Company in accordance with the
terms of the Warrant.
     3. Delivery of Exercise Shares. The Company shall deliver to the holder
                     Exercise Shares in accordance with the terms of the
Warrant.
Date:                     ,    
                                                
Name of Registered Holder

                By:           Name:           Title:          

A-13

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ACKNOWLEDGMENT
     The Company hereby acknowledges this Exercise Notice and, if applicable,
hereby directs [Insert name of Company’s transfer agent] to issue the above
indicated number of shares of Common Stock in accordance with the Transfer Agent
Instructions dated                     , 2010 from the Company and acknowledged
and agreed to by [Insert name of Company’s transfer agent].

            COLUMBIA LABORATORIES, INC.
      By:           Name:           Title:      

A-14

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ASSIGNMENT FORM
     (To assign the foregoing Warrant, subject to compliance with Section 4.3 of
the Warrant, execute this form and supply required information. Do not use this
form to purchase shares.)
FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are
hereby assigned to

     
Name:
 
 
 
  (Please Print)
 
   
Address:
 
 
 
  (Please Print)

Dated:                     , 201_
                                        
Holder’s Signature:
                                        
Holder’s Address:
NOTE: The signature to this Assignment Form must correspond with the name as it
appears on the face of the Warrant, without alteration or enlargement or any
change whatever. Officers of corporations and those acting in a fiduciary or
other representative capacity should file proper evidence of authority to assign
the foregoing Warrant.

A-15

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Exhibit B
FORM OF AMENDMENT NO. 1
TO
CONVERTIBLE SUBORDINATED NOTE
     This Amendment No. 1 (this “Amendment”) to each of Columbia Laboratories,
Inc.’s (the “Company”) Convertible Subordinated Notes due December 31, 2011
(each, a “Note” and collectively, the “Notes”), is made as of March 3, 2010.
Except as otherwise provided herein, capitalized terms used herein shall have
the meanings set forth in the Notes. For purposes hereof, the “Note Purchase
Agreements” shall mean the Note Purchase and Amendment Agreements, dated on or
after March 3, 2010, each by and among the Company and certain other persons
relating to the Notes.
     1. The definition of Fundamental Transaction is hereby amended and restated
in its entirety to read as follows:
“‘Fundamental Transaction’ means that (A) the Company shall, directly or
indirectly, in one or more related transactions, (i) consolidate or merge with
or into (whether or not the Company is the surviving corporation) another Person
or Persons, or (ii) sell, assign, transfer, convey or otherwise dispose of all
or substantially all of the properties or assets of the Company to another
Person, or (iii) allow another Person to make a purchase, tender or exchange
offer that is accepted by the holders of more than 50% of the outstanding shares
of Voting Stock (not including any shares of Voting Stock held by the Person or
Persons making or party to, or associated or affiliated with the Persons making
or party to, such purchase, tender or exchange offer), or (iv) consummate a
stock purchase agreement or other business combination (including, without
limitation, a reorganization, recapitalization, spin-off or scheme of
arrangement) with another Person whereby such other Person acquires more than
the 50% of the outstanding shares of Voting Stock (not including any shares of
Voting Stock held by the other Person or other Persons making or party to, or
associated or affiliated with the other Persons making or party to, such stock
purchase agreement or other business combination), or (v) reorganize,
recapitalize or reclassify its Common Stock, or (B) any “person” or “group” (as
these terms are used for purposes of Sections 13(d) and 14(d) of the Exchange
Act) is or shall become the “beneficial owner” (as defined in Rule 13d-3 under
the Exchange Act), directly or indirectly, of 50% of the aggregate Voting Stock
of the Company, excluding, in each case of clauses (A)(i), (ii), (iii),
(iv) and/or (v) and/or (B) of this definition a Permitted Transaction. A
“Permitted Transaction” shall mean, the transaction (or series of related
transactions) publicly announced by the Company in a Current Report on Form 8-K
filed by the Company with the Securities and Exchange Commission on or prior to
the date that is one Business Day after the date of Amendment No. 1 to the Notes
(the “Form 8-K”), which transaction includes the license, sale, transfer or
other disposition of rights or assets of the Company related to, and/or the
co-development, co-promotion, co-marketing, distribution or other collaboration
with respect to, one or more of the Company’s products with (and possibly a sale
of Company capital stock), pursuant to which the Company (is to, or) receives
proceeds of at least $40 million in cash consideration at the initial closing
thereof. For the avoidance of doubt, a “Permitted Transaction” shall not include
any transaction (or series of related transactions) (x) that is not contemplated
by the Form 8-K and (y) the initial closing of which does not occur
contemporaneously with the closings under the Note

B-1

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Purchase and Amendment Agreements, each dated on or after March 3, 2010, each by
and among the Company and certain holders of the Notes. “Business Day” shall
mean any day that is not a Saturday or Sunday or other day on which commercial
banks in The City of New York are authorized or required by law to remain
closed.”
     2. Except as provided herein, the Notes remain in full force and effect.
     3. On the Amendment Termination Date (as defined in the Note Purchase
Agreements), if it occurs, this Amendment shall automatically terminate and be
of no further force and effect as of the Amendment Termination Date.
     4. All issues and questions concerning the construction, validity,
enforcement and interpretation of this Amendment shall be governed by and
construed in accordance with the laws of the State of New York, without giving
effect to any choice of law rules or provisions (whether of the State of New
York or any other jurisdiction) that would cause the application of the laws of
any jurisdiction other than the State of New York.
[Remainder of page intentionally blank.]

B-2

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     IN WITNESS WHEREOF, the Company has duly executed this AMENDMENT as of the
date first above written.

            COLUMBIA LABORATORIES, INC.
      By:           Name:           Title:      

B-3

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Exhibit C
SENIOR DEBT SATISFACTION
Reference is made to that certain letter agreement, dated March 3, 2010 (the
“Letter Agreement”), between Columbia Laboratories, Inc. (the “Company”) and
PharmaBio Development Inc. (“PharmaBio”). This acknowledgement is delivered
pursuant to the Letter Agreement.
PharmaBio acknowledges and agrees that all of the “Senior Debt” (as defined in
the Company’s Convertible Subordinated Notes due December 31, 2011) has been
satisfied and paid in full.
Acknowledged this ___ day of ___ 2010.

            PHARMABIO DEVELOPMENT INC.
      By:           Name:           Title:        

C-1

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Exhibit D

FORM OF

CERTIFICATE OF NON-AFFILIATE HOLDER
     Reference is made to those certain Note Purchase and Amendment Agreements,
dated on or after March 3, 2010 (the “Agreement”), by and among Columbia
Laboratories, Inc. (the “Company”) and certain other parties (the “Holders”).
This Certificate is being delivered pursuant to Section 2(i)(i)(B) of the
Agreement. All capitalized terms used and not otherwise defined herein shall
have the respective meanings provided in the Agreement.
The undersigned[, being a duly authorized officer or representative of the]1
Holder hereby certifies that:
     (1) such Holder is not an “affiliate” (as such term is defined in Rule 405
under the Securities Act) of the Company nor has such Holder been such an
“affiliate” during the three (3) months preceding the date hereof;
     (2) such Holder acquired its Holder Notes at least one year prior to the
date hereof; and
     (3) to such Holder’s knowledge, all of the [Shares] [Warrants] [Warrant
Shares]2 to be issued to the Holder without restrictive legends
contemporaneously herewith may be sold by such Holder under Rule 144 under the
Securities Act during any ninety (90) day period.
DATED: ______ ___, 20___

            [HOLDER]       By:           Name:           Title:        

 

1   This Certificate shall be executed, in the case of an entity by a duly
authorized officer or representative thereof or in the case of an individual, by
such individual.   2   Insert all applicable securities that the Holder is
requiring the Company to issue without restrictive legends.

D-1

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SCHEDULE I

                                                                      Allocation
                                        Number of Shares Name/Address of  
Jurisdiction of   Principal Amount of   Warrant   Cash           Covered by
Holder   Organization   Holder Notes Owned   Percentage   Consideration*  
Shares   Warrants
PERRY PARTNERS
INTERNATIONAL INC.
767 5thAve.
19th Floor
New York, NY 10153
(212) 583-4146
  British Virgin
Islands   $ 12,415,903.50       31.04 %   $ 8,070,337.28       2,299,257      
2,406,182  
 
                                           
PERRY PARTNERS, L.P.
767 5thAve.
19th Floor
New York, NY 10153
(212) 583-4146
  Delaware   $ 5,584,094.25       13.96 %   $ 3,629,661.26       1,034,073      
1,082,188  
 
                                           
Aggregate Principal Amount of Holder Notes Owned:
      $ 17,999,997.75                                  
 
                                           
Expenses Cap:
      $ 100,000                                  

 

*    Excluding accrued and unpaid interest on the Notes.

 

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ANNEX TO EXHIBIT 10.1
The following schedule was prepared in accordance with the provisions of
Item 601 of Regulation S-K. Note Purchase and Amendment Agreements substantially
similar to the Note Purchase and Amendment Agreement filed as Exhibit 10.1 to
this Current Report on Form 8-K, each, dated as of March 3, 2010, were entered
into between Columbia Laboratories, Inc. and the Holders listed on this Annex.
Set forth below are the material details in which such Note Purchase and
Amendment Agreements differ from the Note Purchase and Amendment Agreement filed
as Exhibit 10.1 to this Current Report on Form 8-K.

                                                                      Allocation
        Principal                   Number of             Amount of            
      Shares             Holder Notes   Warrant   Cash   Covered by   Common    
Holder   Owned   Percentage   Consideration*   Warrants   Stock   Expenses Cap
14159 L.P.
  $ 140,000       0.35 %   $ 91,000       27,132       25,909         (1)
BAKER BROTHERS LIFE SCIENCES, L.P.
  $ 4,256,000       10.64 %   $ 2,766,400       824,806       787,624        
(1)
667, L.P. (#1)
  $ 805,000       2.01 %   $ 523,250       156,008       148,790         (1)
667, L.P. (#2)
  $ 719,000       1.80 %   $ 467,350       139,341       133,244         (1)
BAKER TISCH INVESTMENTS, L.P. (#1)
  $ 42,000       0.11 %   $ 27,300       8,140       8,143         (1)
BAKER TISCH INVESTMENTS, L.P. (#2)
  $ 38,000       0.10 %   $ 24,700       7,364       7,402         (1)
KENNETH E. BEEBE AND JANET E. BEEBE
  $ 100,000       0.25 %   $ 65,000       19,379       18,582         (2)
KIRK AND DANA BEEBE
  $ 100,000       0.25 %   $ 65,000       19,379       18,582         (2)
BEEBE 88 PARTNERS
  $ 30,000       0.08 %   $ 19,500       4,984       5,946         (2)
BEEBE 98 PARTNERS
  $ 40,000       0.08 %   $ 26,000       6,646       5,946         (2)
THE ASCEND FUND
  $ 1,500,000       3.75 %   $ 975,000       290,699       278,722         (2)
CURRAN FAMILY PARTNERS II
  $ 2,000,000       5.00 %   $ 1,300,000       387,597       370,371     $ 1,500
 
HIGHBRIDGE INTERNATIONAL LLC
  $ 6,000,000       15.00 %   $ 3,900,000       1,162,790       1,111,112     $
15,000  
KNOTT PARTNERS, LP
  $ 136,000       00.34 %   $ 88,400       26,355       25,165         (3)
KNOTT PARTNERS OFFSHORE MASTER FUND, LP
  $ 3,940,000       9.85 %   $ 2,561,000       763,566       729,047         (3)
SHOSHONE PARTNERS, LP
  $ 628,000       1.57 %   $ 408,200       121,705       116,203         (3)

 

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                                                                      Allocation
        Principal                   Number of             Amount of            
      Shares             Holder Notes   Warrant   Cash   Covered by   Common    
Holder   Owned   Percentage   Consideration*   Warrants   Stock   Expenses Cap
FINDERNE, LLC
  $ 55,000       0.14 %   $ 35,750       10,661       10,362         (3)
COMMONFUND HEDGED EQUITY COMPANY
  $ 158,000       0.40 %   $ 102,700       30,619       29,606         (3)
MULSANNE PARTNERS, LP
  $ 83,000       0.21 %   $ 53,950       16,086       15,543         (3)
MORRISON FAMILY TRUST DTD 51593
  $ 700,000       1.75 %   $ 455,000       135,659       129,420         (4)
MORRISON 1997 CRT
  $ 430,000       1.08 %   $ 279,500       83,333       79,870         (4)
LAURIE C. MORRISON TRUST
  $ 100,000       00.25 %   $ 65,000       19,381       18,488         (4)

 

*   Excluding accrued and unpaid interest on the Notes.   (1)   14159 L.P.,
BAKER BROTHERS LIFE SCIENCES, L.P., 667, L.P. (#1), 667, L.P. (#2), BAKER TISCH
INVESTMENTS, L.P. (#1) and BAKER TISCH INVESTMENTS, L.P. (#2) have an expense
cap of $4,500, in the aggregate.   (2)   KENNETH E. BEEBE AND JANET E. BEEBE,
KIRK AND DANA BEEBE, BEEBE 88 PARTNERS, BEEBE 98 PARTNERS and THE ASCEND FUND
have an expense cap of $1,500, in the aggregate.   (3)   KNOTT PARTNERS, LP,
KNOTT PARTNERS OFFSHORE MASTER FUND, LP, SHOSHONE PARTNERS, LP, FINDERNE, LLC,
COMMONFUND HEDGED EQUITY COMPANY and MULSANNE PARTNERS, LP have an expense cap
of $4,000, in the aggregate.   (4)   MORRISON FAMILY TRUST DTD 51593, MORRISON
1997 CRT and LAURIE C. MORRISON TRUST have an expense cap of $1,000, in the
aggregate.

2