Exhibit 10.7

 

  

Deutsche Bank LOGO [g83114img.jpg]

 

Deutsche Bank AG, London Branch

Winchester house

1 Great Winchester St,

London EC2N 2DB

Telephone: 44 20 7545 8000

 

c/o Deutsche Bank Securities Inc.

60 Wall Street

New York, NY 10005

Telephone: 212-250-2500

 

DATE:    As of April 9, 2008    TO:    Endo Pharmaceuticals Holdings Inc.   
ATTENTION:    Chief Legal Officer    TELEPHONE:    610-558-9800    FACSIMILE:   
610-558-9684    FROM:    Deutsche Bank AG, London Branch    TELEPHONE:    44 20
7545 0556    FACSIMILE:    44 11 3336 2009    SUBJECT:    Equity Derivatives
Confirmation    REFERENCE NUMBER(S):    252010   

The purpose of this facsimile agreement (this “Confirmation”) is to confirm the
terms and conditions of the transaction entered into between Deutsche Bank AG,
London Branch (“Deutsche”) and Endo Pharmaceuticals Holdings Inc.
(“Counterparty”) on the Trade Date specified below (the “Transaction”). This
Confirmation constitutes a “Confirmation” as referred to in the ISDA Master
Agreement specified below. This Confirmation constitutes the entire agreement
and understanding of the parties with respect to the subject matter and terms of
the Transaction and supersedes all prior or contemporaneous written and oral
communications with respect thereto.

DEUTSCHE BANK AG IS NOT REGISTERED AS A BROKER OR DEALER UNDER THE U.S.
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. DEUTSCHE BANK SECURITIES INC.
(“AGENT”) HAS ACTED SOLELY AS AGENT IN CONNECTION WITH THE TRANSACTION AND HAS
NO OBLIGATION, BY WAY OF ISSUANCE, ENDORSEMENT, GUARANTEE OR OTHERWISE WITH
RESPECT TO THE PERFORMANCE OF EITHER PARTY UNDER THE TRANSACTION. DEUTSCHE BANK
AG, LONDON BRANCH IS NOT A MEMBER OF THE SECURITIES INVESTOR PROTECTION
CORPORATION (SIPC).

The definitions contained in the 2002 ISDA Equity Derivatives Definitions (the
“Equity Definitions”), as published by the International Swaps and Derivatives
Association, Inc., are incorporated into this Confirmation. In the event of any
inconsistency between the Equity Definitions and the terms of this Confirmation,
the terms of this Confirmation shall govern. For the purposes of the Equity
Definitions, each reference herein to a Note Hedging Unit shall be deemed to be
a reference to a Call or an Option, as context requires.

 

Chairman of the Supervisory Board: Clemens Börsig

Board of Managing Directors: Hermann-Josef Lamberti, Josef Ackermann, Anthony
Dilorio, Hugo Banziger

  Deutsche Bank AG is regulated by the FSA for the conduct of designated
investment business in the UK, is a member of the London Stock Exchange and is a
limited liability company incorporated in the Federal Republic of Germany HRB
No. 30 000 District Court of Frankfurt am Main; Branch Registration No. in
England and Wales BR000005, Registered address: Winchester House, 1 Great
Winchester Street, London EC2N 2DB.

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This Confirmation evidences a complete and binding agreement between Deutsche
and Counterparty as to the terms of the Transaction to which this Confirmation
relates. This Confirmation shall supplement, form a part of, and be subject to
an agreement (the “Agreement”) in the form of the ISDA 2002 Master Agreement as
if Deutsche and Counterparty had executed an agreement in such form (without any
Schedule but with the elections set forth in this Confirmation). For the
avoidance of doubt, the Transaction shall be the only transaction under the
Agreement.

 

2. The Transaction shall be considered a Share Option Transaction for purposes
of the Equity Definitions, and shall have the following terms:

 

General:    Trade Date:    April 9, 2008. Effective Date:    The closing date
for the initial issuance of the Convertible Notes. Transaction Style:   
Modified American, as described below under “Procedure for Exercise”.
Transaction Type:    Note Hedging Units. Seller:    Deutsche. Buyer:   
Counterparty. Shares:    The common stock, par value USD 0.01 per share, of
Counterparty (Ticker Symbol: “ENDP”). Convertible Notes:    1.75% Senior
Subordinated Convertible Notes of Counterparty due April 15, 2015, offered
pursuant to an Offering Memorandum dated April 9, 2008 (“Offering Memorandum”)
and issued pursuant to the indenture to be dated on or about April 15, 2008, by
and between Counterparty and The Bank of New York, as trustee (as may be
amended, modified or supplemented from time to time, but only if such amendment,
modification or supplement is consented by Deutsche in writing, the
“Indenture”). Certain defined terms used herein have the meanings assigned to
them in the Indenture. In the event of any inconsistency between the terms
defined in the Indenture and this Confirmation, this Confirmation shall govern.
For the avoidance of doubt, references herein to sections of the Indenture are
based on the draft of the Indenture most recently reviewed by the parties at the
time of execution of this Confirmation. If any relevant sections of the
Indenture are changed, added or renumbered following execution of this
Confirmation, the parties will amend this Confirmation in good faith to preserve
the economic intent of the parties. Number of Note Hedging Units:    379,500.

 

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Note Hedging Unit Entitlement:    USD 1,000 divided by the Strike Price.
Notwithstanding anything to the contrary herein or in the Agreement (including
without limitation the provisions of Calculation Agent Adjustment), in no event
shall the Note Hedging Unit Entitlement at any time be greater than the
“Conversion Rate” (as defined in the Indenture) at such time. Strike Price:   
USD 29.20. Premium:    As provided in Annex A to this Confirmation. Premium
Payment Date:    The Effective Date. Exchange:    The NASDAQ Global Select
Market. Related Exchanges:    All Exchanges. Calculation Agent:    Deutsche.
Procedure for Exercise:    Potential Exercise Dates:    Each Conversion Date.
Conversion Date:    Each “Conversion Date”, as defined in the Indenture.
Required Exercise on Conversion Dates:    On each Conversion Date, a number of
Note Hedging Units equal to the number of Convertible Notes in denominations of
USD 1,000 principal amount submitted for conversion in respect of such
Conversion Date in accordance with the terms of the Indenture shall be exercised
automatically, subject to “Notice of Exercise” below; provided that if
Counterparty has made an “Exchange Election” pursuant to the “Exchange in Lieu
of Conversion” provisions of Section 5.14 of the Indenture, the applicable
Convertible Notes shall remain outstanding and the related number of Note
Hedging Units shall not be exercised. Expiration Date:    April 15, 2015.
Multiple Exercise:    Applicable, as provided under “Required Exercise on
Conversion Dates”. Automatic Exercise:    As provided under “Required Exercise
on Conversion Dates”. Notice of Exercise:    Notwithstanding anything to the
contrary in the Equity Definitions, in order to exercise any Note Hedging Units,
Counterparty must notify Deutsche in writing (and use reasonable efforts to
confirm receipt by telephone to Deutsche’s Convertible Desk (telephone:
212-250-5600)) prior to 5:00 PM, New York City time, on the Scheduled Trading
Day prior to the first day of the “Conversion Period”, as defined in the
Indenture, relating to the Convertible Notes converted on the Conversion Date
relating to the relevant Exercise Date (the “Notice Deadline”) of (i) the number
of Note Hedging Units being exercised on such Exercise Date, (ii) the scheduled
commencement date of the “Conversion Period”

 

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   and the scheduled settlement date under the Indenture for the Convertible
Notes converted on the Conversion Date corresponding to such Exercise Date and
(iii) the applicable “Specified Dollar Amount”, as defined in the Indenture,
provided that the “Specified Dollar Amount” shall be deemed USD 1,000 for
purposes of calculating the Settlement Amount (as defined below) if such notice
does not specify the “Specified Dollar Amount”; provided further that,
notwithstanding the foregoing, such notice shall be effective if given after the
Notice Deadline referred to above, but prior to 5:00 PM New York City time, on
the fifth Scheduled Trading Day of such “Conversion Period”, in which event the
Calculation Agent shall have the right to adjust the Settlement Amount as
appropriate to reflect the additional costs (including, but not limited to,
hedging mismatches and market losses) and expenses actually incurred by Deutsche
in connection with its hedging activities (including the unwinding of any hedge
position) as a result of Deutsche not having received such notice prior to the
Notice Deadline; provided further that in respect of Convertible Notes converted
during the period beginning on, and including the 45th scheduled “Trading Day”,
as defined in the Indenture, prior to the “Final Maturity Date”, as defined in
the Indenture, and ending on the second “Business Day”, as defined in the
Indenture, immediately preceding the “Final Maturity Date”, (x) the Notice
Deadline in respect of the information set forth in clauses (i) and (ii) above
shall be the second “Business Day” immediately preceding the “Final Maturity
Date”, (y) the Notice Deadline in respect of the information set forth in clause
(iii) above shall be 5:00 PM, New York City time, on the Scheduled Trading Day
prior to the first day of the “Conversion Period” relating to the relevant
Convertible Notes and (z) late notice shall not be permitted pursuant to the
immediately preceding provisio. Settlement Terms:    Net Share Settlement:    In
lieu of the obligations set forth in Sections 8.1 and 9.1 of the Equity
Definitions, and subject to “Notice of Exercise” above, in respect of any
Exercise Date occurring on a Conversion Date, Deutsche shall deliver to
Counterparty, on the related Settlement Date, the Settlement Amount. For the
avoidance of doubt, to the extent Deutsche is obligated to deliver Shares
hereunder, the provisions of Sections 9.8, 9.9, 9.11 and 9.12 of the Equity
Definitions shall be applicable to any such delivery of Shares, except that all
references in such provisions to “Physical Settlement” and “Physically-settled”
shall be read as references to “Net Share Settlement” and “Net Share Settled”;
and provided that the Representation and Agreement contained in Section 9.11 of
the Equity Definitions shall be modified by excluding any representations
therein relating to restrictions, obligations, limitations or requirements under
applicable securities laws as a result of the fact that Counterparty is the
issuer of the Shares.

 

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Settlement Amount:   

A number of Shares and/or amount of cash in USD equal to:

 

(a) if the applicable “Specified Dollar Amount” is equal to zero, a number of
shares equal to the lesser of (1) the sum, for each “Trading Day” during the
related “Conversion Period”, of the greater of (x) the “Daily Net Share
Settlement Value” calculated as if the “Specified Dollar Amount” were USD 1,000
and (y) zero and (2) the result of clause (1) determined as if the “Daily
Conversion Value” for each “Trading Day” during the related “Conversion Period”
were the “Daily Conversion Value” on the last “Trading Day” of such “Conversion
Period” (each as defined in the Indenture);

 

(b) if the applicable “Specified Dollar Amount” is greater than zero and less
than or equal to USD 1,000, a number of shares equal to the sum, for each
“Trading Day” during the related “Conversion Period”, of the greater of (1) the
“Daily Net Share Settlement Value”, calculated as if the “Specified Dollar
Amount” (each as defined in the Indenture) were USD 1,000 and (2) zero; or

 

(c) if the applicable “Specified Dollar Amount” is greater than USD 1,000, (1) a
number of shares equal to the sum, for each “Trading Day” during the related
“Conversion Period”, of the greater of (x) the “Daily Net Share Settlement
Value”, and (y) zero, and (2) an amount of cash equal to the sum, for each
“Trading Day” during the related “Conversion Period”, of (i) the excess, if any,
of the lesser of the “Daily Conversion Value” and the “Daily Measurement Value”
(each as defined in the Indenture), over (ii) USD 25;

 

provided that such obligation shall be determined excluding any Shares or cash
that Counterparty is obligated to deliver to holder(s) of the Convertible Notes
as a result of any adjustments to the “Conversion Rate” for the issuance of
additional shares or cash as set forth in Section 4.02 of the Indenture or any
voluntary adjustment pursuant to Section 5.08 or Section 5.09 of the Indenture;
provided further that, if such exercise relates to the conversion of Convertible
Notes in connection with which holders thereof are entitled to receive
additional Shares or cash pursuant to the adjustments to the “Conversion Rate”
set forth in Section 4.02 of the Indenture, then, notwithstanding the foregoing,
the Settlement Amount shall include such additional Shares or cash, except that
the Settlement Amount shall be capped so that the value of the Settlement Amount
per Note Hedging Unit (with the value of the Shares included in the Settlement
Amount determined by the Calculation Agent using the volume-weighted average
price on the last day of the relevant “Conversion Period”) does not exceed the
amount as determined by the Calculation Agent that would be payable by Seller
pursuant to Section 6 of the Agreement if such Conversion Date were an Early
Termination Date resulting from an Additional Termination Event with respect to
which the Transaction (except that, for purposes of determining such amount the
Number of Note Hedging Units shall be deemed to be equal to the number of Note
Hedging Units exercised on such Exercise Date) was the sole Affected Transaction
and Counterparty was the sole Affected Party (determined without regard to
provisions under “Alternative Calculations and Deutsche Payment on Early

 

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Termination and on Certain Extraordinary Events” in this Confirmation). If
Counterparty is permitted or required to exercise discretion under the terms of
the Indenture with respect to any determination, calculation or adjustment
relevant to conversion of the Convertible Notes including, but not limited to,
the volume-weighted average price of the Shares, Counterparty shall consult with
Deutsche with respect thereto (except for the determination of the “Specified
Dollar Amount”, as defined in the Indenture) and the Calculation Agent shall
make such determination, calculation or adjustment for purposes of the
Transaction. For the avoidance of doubt, if the “Daily Conversion Value” for
each of the 40 “Trading Days” in the relevant “Conversion Period”, each as
defined in the Indenture, is less than or equal to USD 25, Deutsche will have no
delivery obligation hereunder.

 

Notwithstanding anything to the contrary above, in no event shall Deutsche be
obligated to deliver a Settlement Amount with a value in excess of the value
(determined on the same basis) of what Counterparty is obligated to deliver in
respect of the relevant Convertible Notes, reduced by USD 1000 per note.

Notice of Delivery Obligation:    No later than the Scheduled Trading Day
immediately following the last day of the “Conversion Period”, as defined in the
Indenture, Counterparty shall give Deutsche notice of the final number of Shares
and/or cash comprising the Settlement Amount and the Settlement Date (it being
understood, for the avoidance of doubt, that the requirement of Counterparty to
deliver such notice shall not limit Counterparty’s obligations with respect to
Notice of Exercise, as set forth above, in any way or Deutsche’s obligation to
deliver the Settlement Amount promptly following any late Notice of Delivery
Obligation). Settlement Date:    In respect of an Exercise Date occurring on a
Conversion Date, the settlement date for the Shares or cash to be delivered
under the Convertible Notes under the terms of the Indenture; provided that the
Settlement Date will not be prior to the date that is one Settlement Cycle
following the final day of the “Conversion Period”, as defined in the Indenture.
Settlement Currency:    USD. Restricted Certificated Shares:    Notwithstanding
anything to the contrary in the Equity Definitions, Deutsche may, in whole or in
part, deliver Shares in certificated form representing the Share portion of the
Settlement Amount to Counterparty in lieu of delivery through the Clearance
System. Share Adjustments:    Potential Adjustment Events:    Notwithstanding
Section 11.2(e) of the Equity Definitions, a “Potential Adjustment Event” means
any occurrence of any event or condition, as set forth in Section 5.06 of the
Indenture, that would result in an adjustment to the “Conversion Rate” of the
Convertible Notes; provided that in no event shall there be any adjustment
hereunder as a result of an adjustment to the “Conversion Rate” pursuant to
Section 4.02, Section 5.08 or Section 5.09 of the Indenture.

 

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Method of Adjustment:    Calculation Agent Adjustment, which means that,
notwithstanding Section 11.2(c) of the Equity Definitions, upon any adjustment
to the “Conversion Rate” of the Convertible Notes pursuant to the Indenture
(other than Section 4.02, Section 5.08 or Section 5.09 of the Indenture), the
Calculation Agent shall make a corresponding adjustment to any one or more of
the Strike Price, Number of Note Hedging Units, the Note Hedging Unit
Entitlement and any other variable relevant to the exercise, settlement, payment
or other terms of the Transaction. Extraordinary Events:    Merger Events:   
Notwithstanding Section 12.1(b) of the Equity Definitions, a “Merger Event”
means the occurrence of any event or condition set forth in Section 5.11 of the
Indenture. Notice of Merger Consideration:    Upon the occurrence of a Merger
Event that causes the Shares to be converted into or exchanged for more than a
single type of consideration (determined based in part upon the form of election
of the holders of Shares), Counterparty shall promptly (but in any event prior
to the effective date of the Merger Event) notify the Calculation Agent of
“Reference Property”, as defined in the Indenture, to result from such Merger
Event. Consequences of Merger Events:    Notwithstanding Section 12.2 of the
Equity Definitions, upon the occurrence of a Merger Event, the Calculation Agent
shall make the corresponding adjustment in respect of any adjustment under the
Indenture to any one or more of the nature of the Shares, the Strike Price, the
Number of Note Hedging Units, the Note Hedging Unit Entitlement and any other
variable relevant to the exercise, settlement, payment or other terms of the
Transaction, to the extent an analogous adjustment is made under the Indenture;
provided that such adjustment shall be made without regard to any adjustment to
the “Conversion Rate” for the issuance of additional shares or cash as set forth
in Section 4.02 of the Indenture or any voluntary adjustment pursuant to Section
5.08 or Section 5.09 of the Indenture.
Nationalization, Insolvency and Delisting:    Cancellation and Payment
(Calculation Agent Determination); provided that in addition to the provisions
of Section 12.6(a)(iii) of the Equity Definitions, it shall also constitute a
Delisting if the Exchange is located in the United States and the Shares are not
immediately re-listed, re-traded or re-quoted on any U.S. national securities
exchange; if the Shares are immediately re-listed, re-traded or re-quoted on any
such exchange, such exchange shall be deemed to be the Exchange. For the
avoidance of doubt, the occurrence of any event that is a Merger Event and would
otherwise have been a Delisting will have the consequence specified for the
relevant Merger Event.

 

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Additional Disruption Events:    Change in Law:    Applicable; provided that
Section 12.9(a)(ii) of the Equity Definitions is hereby amended (i) by replacing
the phrase “the interpretation” in the third line thereof with the phrase “or
public announcement of the formal or informal interpretation” and (ii)
immediately following the word “Transaction” in clause (X) thereof, adding the
phrase “in the manner contemplated by the Hedging Party on the Trade Date”.
Failure to Deliver:    Applicable Insolvency Filing:    Applicable Increased
Cost of Hedging:    Not Applicable Determining Party:    Deutsche for all
applicable Additional Disruption Events Acknowledgements:    Non-Reliance:   
Applicable Agreements and Acknowledgements
Regarding Hedging Activities:    Applicable Additional Acknowledgements:   
Applicable

Mutual Representations: Each of Deutsche and Counterparty represents and
warrants to, and agrees with, the other party that:

 

  (i) Tax Disclosure. Notwithstanding anything to the contrary herein, in the
Equity Definitions or in the Agreement, and notwithstanding any express or
implied claims of exclusivity or proprietary rights, the parties (and each of
their employees, representatives or other agents) are authorized to disclose to
any and all persons, beginning immediately upon commencement of their
discussions and without limitation of any kind, the tax treatment and tax
structure of the Transaction, and all materials of any kind (including opinions
or other tax analyses) that are provided by either party to the other relating
to such tax treatment and tax structure.

 

  (ii) Commodity Exchange Act. It is an “eligible contract participant” within
the meaning of Section 1a(12) of the U.S. Commodity Exchange Act, as amended
(the “CEA”). The Transaction has been subject to individual negotiation by the
parties. The Transaction has not been executed or traded on a “trading facility”
as defined in Section 1a(33) of the CEA. It has entered into the Transaction
with the expectation and intent that the Transaction shall be performed to its
termination date.

 

  (iii) Securities Act. It is a “qualified institutional buyer” as defined in
Rule 144A under the U.S. Securities Act of 1933, as amended (the “Securities
Act”), or an “accredited investor” as defined under the Securities Act.

 

  (iv) ERISA. The assets used in the Transaction (1) are not assets of any
“plan” (as such term is defined in Section 4975 of the U.S. Internal Revenue
Code (the “Code”)) subject to Section 4975 of the Code or any “employee benefit
plan” (as such term is defined in Section 3(3) of the U.S. Employee Retirement
Income Security Act of 1974, as amended (“ERISA”)) subject to Title I of ERISA,
and (2) do not constitute “plan assets” within the meaning of Department of
Labor Regulation 2510.3-101, 29 CFR Section 2510-3-101.

 

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Counterparty Representations: In addition to the representations and warranties
in the Agreement and those contained elsewhere herein, Counterparty represents,
warrants, acknowledges and covenants that:

 

  (i) Counterparty is not as of the Trade Date, and shall not be after giving
effect to the transactions contemplated hereby, “insolvent” (as such term is
defined in Section 101(32) of the U.S. Bankruptcy Code (Title 11 of the United
States Code) (the “Bankruptcy Code”)).

 

  (ii) Counterparty shall as soon as practicable provide written notice to
Deutsche upon obtaining knowledge of the occurrence of any event that would
constitute an Event of Default, a Potential Event of Default, a Potential
Adjustment Event, a Merger Event or any other Extraordinary Event; provided,
however, that should Counterparty be in possession of material non-public
information regarding Counterparty, Counterparty shall not communicate such
information to Deutsche.

 

  (iii) Counterparty has (and shall at all times during the Transaction have)
the capacity and authority to invest directly in the Shares underlying the
Transaction and has not entered into the Transaction with the intent to avoid
any regulatory filings.

 

  (iv) Counterparty’s investments in and liabilities in respect of the
Transaction, which it understands are not readily marketable, are not
disproportionate to its net worth, and Counterparty is able to bear any loss in
connection with the Transaction, including the loss of its entire investment in
the Transaction.

  (v) The representations and warranties of Counterparty set forth in Section 1
of the Purchase Agreement dated April 9, 2008 between Counterparty and Deutsche
Bank Securities Inc. as representative of the initial purchasers are true and
correct and are hereby deemed to be repeated to Deutsche as if set forth herein.

 

  (vi) Counterparty understands, agrees and acknowledges that Deutsche has no
obligation or intention to register the Transaction under the Securities Act,
any state securities law or other applicable federal securities law.

 

  (vii) Counterparty is not, and after giving effect to the transactions
contemplated hereby will not be, an “investment company” as such term is defined
in the Investment Company Act.

 

  (viii) Counterparty understands, agrees and acknowledges that no obligations
of Deutsche to it hereunder shall be entitled to the benefit of deposit
insurance and that such obligations shall not be guaranteed by any affiliate of
Deutsche or any governmental agency.

 

  (ix) (A) Counterparty is acting for its own account, and it has made its own
independent decisions to enter into the Transaction and as to whether the
Transaction is appropriate or proper for it based upon its own judgment and upon
advice from such advisers as it has deemed necessary, (B) Counterparty is not
relying on any communication (written or oral) of Deutsche or any of its
affiliates as investment advice or as a recommendation to enter into the
Transaction (it being understood that information and explanations related to
the terms and conditions of the Transaction shall not be considered investment
advice or a recommendation to enter into the Transaction) and (C) no
communication (written or oral) received from Deutsche or any of its affiliates
shall be deemed to be an assurance or guarantee as to the expected results of
the Transaction.

 

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  (x) Without limiting the generality of Section 13.1 of the Equity Definitions,
Counterparty acknowledges that Deutsche is not making any representations or
warranties with respect to the treatment of the Transaction under FASB
Statements 128, 133, 149 or 150 (or under any successor statement), EITF Issue
No. 00-19, 01-6, 03-6 or 07-5 (or any successor issue statements), under FASB’s
Liabilities & Equity Project, or under any other accounting guidance.

 

  (xi) Counterparty is not entering into the Transaction for the purpose of
(i) creating actual or apparent trading activity in the Shares (or any security
convertible into or exchangeable for the Shares) or (ii) raising or depressing
or otherwise manipulating the price of the Shares (or any security convertible
into or exchangeable for the Shares), in either case in violation of the U.S.
Securities Exchange Act of 1934, as amended (the “Exchange Act”).

 

  (xii) Counterparty acknowledges its responsibilities under applicable law
(including, without limitation, the Securities Act and Section 9 and
Section 10(b) of the Exchange Act) in connection with the Transaction.

 

  (xiii) The Transaction, and any repurchase of the Shares by Counterparty in
connection with the Transaction, is pursuant to a publicly announced Share
repurchase program that has been approved by Counterparty’s board of directors
(including engaging in derivative transactions) and any such repurchase has
been, or shall when so required be, publicly disclosed in its periodic filings
under the Exchange Act and its financial statements and notes thereto.

 

  (xiv) Counterparty shall deliver to Deutsche an opinion of counsel, dated as
of the Trade Date and reasonably acceptable to Deutsche in form and substance,
with respect to the matters set forth in Section 3(a) of the Agreement.

Miscellaneous:

Netting and Set-Off. The parties hereto agree that the Transaction shall not be
subject to any right of netting or set off with any other transaction, whether
under any agreement or by operation of law.

Qualified Financial Contracts. It is the intention of the parties that, in
respect of Counterparty, (a) the Transaction shall constitute a “qualified
financial contract” within the meaning of 12 U.S.C. Section 1821(e)(8)(D)(i) and
(b) a Non-defaulting Party’s rights under Sections 5 and 6 of the Agreement
constitute rights of the kind referred to in 12 U.S.C. Section 1821(e)(8)(A).

Method of Delivery. Whenever delivery of funds or other assets is required
hereunder by or to Counterparty, such delivery shall be effected through Agent.
In addition, all notices, demands and communications of any kind relating to the
Transaction between Deutsche and Counterparty shall be transmitted exclusively
through Agent.

Staggered Settlement. If upon advice of counsel with respect to applicable legal
and regulatory requirements or related policies and procedures applicable to
Deutsche, Deutsche reasonably determines that it would not be advisable to
deliver, or to acquire Shares to deliver, any or all of the Shares to be
delivered by Deutsche on a Settlement Date for the Transaction, Deutsche may, by
notice to Counterparty prior to any Settlement Date (a “Nominal Settlement
Date”), elect to deliver the Shares deliverable on such Nominal Settlement Date
on two or more dates (each, a “Staggered Settlement Date”) or at two or more
times on the Nominal Settlement Date as follows: (i) in such notice, Deutsche
will specify to Counterparty the related Staggered Settlement Dates (each of
which will be on or prior to such Nominal Settlement Date, but not prior to the
beginning of the related “Conversion Period”, as defined in the Indenture) or
delivery times and how it will allocate the Shares it is required to deliver
under “Net Share Settlement” above among the Staggered Settlement Dates or
delivery times; and (ii) the aggregate number of Shares that Deutsche will
deliver to Counterparty hereunder on all such Staggered Settlement Dates and
delivery times will equal the number of Shares that Deutsche would otherwise be
required to deliver on such Nominal Settlement Date.

 

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Additional Termination Events. The occurrence of (i) an “Event of Default” with
respect to Counterparty under the terms of the Convertible Notes, as set forth
in Section 9.01 of the Indenture, that results in an acceleration of the
Convertible Notes pursuant to the terms of the Indenture or (ii) an Amendment
Event shall be an Additional Termination Event, in each case with the
Transaction as the sole Affected Transaction and Counterparty as the sole
Affected Party. In the case of clause (i), Deutsche shall designate an Early
Termination Date no later than the 10th Scheduled Trading Day following
Counterparty’s notice to Deutsche of such acceleration.

“Amendment Event” means that Counterparty amends, modifies, supplements or
obtains a waiver with respect to any term of the Indenture or the Convertible
Notes governing the principal amount, interest, maturity, repurchase obligation
of Counterparty, redemption right of Counterparty, any term relating to
conversion of the Convertible Notes (including changes to the conversion price,
conversion settlement dates or conversion conditions), or any term that would
require consent of the holders of not less than 100% of the principal amount of
the Convertible Notes to amend, in each case without the prior consent of
Deutsche, such consent not to be unreasonably withheld. For the avoidance of
doubt, any changes to the “Conversion Rate” pursuant to Section 4.02,
Section 5.06, Section 5.08 or Section 5.09 of the Indenture shall not constitute
an Amendment Event hereunder.

Disposition of Hedge Shares. Counterparty hereby agrees that if, in the good
faith reasonable judgment of Deutsche, the Shares (the “Hedge Shares”) acquired
by Deutsche for the purpose of hedging its obligations pursuant to the
Transaction cannot be sold in the public market by Deutsche without registration
under the Securities Act, Counterparty shall, at its election: (i) in order to
allow Deutsche to sell the Hedge Shares in a registered offering, make available
to Deutsche an effective registration statement under the Securities Act to
cover the resale of such Hedge Shares and (A) enter into an agreement, in form
and substance satisfactory to Deutsche, substantially in the form of an
underwriting agreement for a registered offering, (B) provide accountant’s
“comfort” letters in customary form for registered offerings of equity
securities, (C) provide disclosure opinions of nationally recognized outside
counsel to Counterparty reasonably acceptable to Deutsche, (D) provide other
customary opinions, certificates and closing documents customary in form for
registered offerings of equity securities and (E) afford Deutsche a reasonable
opportunity to conduct a “due diligence” investigation with respect to
Counterparty customary in scope for underwritten offerings of equity securities;
provided, however, that if Deutsche, in its sole reasonable discretion, is not
satisfied with access to due diligence materials, the results of its due
diligence investigation, or the procedures and documentation for the registered
offering referred to above, then clause (ii) or clause (iii) of this paragraph
shall apply at the election of Counterparty; (ii) in order to allow Deutsche to
sell the Hedge Shares in a private placement, enter into a private placement
agreement substantially similar to private placement purchase agreements
customary for private placements of equity securities, in form and substance
satisfactory to Deutsche, including customary representations, covenants, blue
sky and other governmental filings and/or registrations, indemnities to
Deutsche, due diligence rights (for Deutsche or any designated buyer of the
Hedge Shares from Deutsche), opinions and certificates and such other
documentation as is customary for private placements agreements, all reasonably
acceptable to Deutsche (in which case, the Calculation Agent shall make any
adjustments to the terms of the Transaction that are necessary, in its
reasonable judgment, to compensate Deutsche for any discount from the public
market price of the Shares incurred on the sale of Hedge Shares in a private
placement); or (iii) purchase the Hedge Shares from Deutsche at the VWAP Price
on such Exchange Business Days, and in the amounts, requested by Deutsche. “VWAP
Price” means, on any Exchange Business Day, the per Share volume-weighted
average price as displayed under the heading “Bloomberg VWAP” on Bloomberg page
ENDP.Q <equity> AQR (or any successor thereto) in respect of the period from
9:30 a.m. to 4:00 p.m. (New York City time) on such Exchange Business Day (or if
such volume-weighted average price is unavailable, the market value of one Share
on such Exchange Business Day, as determined by the Calculation Agent using a
volume-weighted method). This paragraph shall survive the termination,
expiration or early unwind of the Transaction.

Status of Claims in Bankruptcy. Deutsche acknowledges and agrees that this
Confirmation is not intended to convey to Deutsche rights with respect to the
Transaction that are senior to the claims of common stockholders in any U.S.
bankruptcy proceedings of Counterparty; provided that nothing herein shall limit
or shall be deemed to limit Deutsche’s right to pursue remedies in the event of
a breach by Counterparty of its obligations and agreements with respect to the
Transaction; provided, further, that nothing herein shall limit or shall be
deemed to limit Deutsche’s rights in respect of any transactions other than the
Transaction.

 

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No Collateral. Notwithstanding any provision of this Confirmation, the
Agreement, Equity Definitions, or any other agreement between the parties to the
contrary, the obligations of Counterparty under the Transaction are not secured
by any collateral.

Securities Contract; Swap Agreement. The parties hereto agree and acknowledge
that Deutsche is a “financial institution,” “swap participant” and “financial
participant” within the meaning of Sections 101(22), 101(53C) and 101(22A) of
the Bankruptcy Code. The parties hereto further agree and acknowledge (A) that
this Confirmation is (i) a “securities contract,” as such term is defined in
Section 741(7) of the Bankruptcy Code, with respect to which each payment and
delivery hereunder or in connection herewith is a “termination value,” “payment
amount” or “other transfer obligation” within the meaning of Section 362 of the
Bankruptcy Code and a “settlement payment” or a “transfer” within the meaning of
Section 546 of the Bankruptcy Code, and (ii) a “swap agreement,” as such term is
defined in Section 101(53B) of the Bankruptcy Code, with respect to which each
payment and delivery hereunder or in connection herewith is a “termination
value,” a “payment amount” or “other transfer obligation” within the meaning of
Section 362 of the Bankruptcy Code and a “transfer” within the meaning of
Section 546 of the Bankruptcy Code, and (B) that Deutsche is entitled to the
protections afforded by, among other sections, Section 362(b)(6), 362(b)(17),
362(b)(27), 362(o), 546(e), 546(g), 546(j), 548(d)(2), 555, 560 and 561 of the
Bankruptcy Code.

Repurchase Notices. Counterparty shall, on any day on which Counterparty effects
any repurchase of Shares, promptly give Deutsche a written notice of such
repurchase (a “Repurchase Notice”) on such day if following such repurchase, the
Unit Equity Percentage as determined on such day differs by 0.5% or more from
the Unit Equity Percentage included in the immediately preceding Repurchase
Notice (or, in the case of the first such Repurchase Notice, greater than the
Unit Equity Percentage as of the date hereof). The “Unit Equity Percentage” as
of any day is the fraction (i) the numerator of which is the product of the
number of Note Hedging Units and the Note Hedging Unit Entitlement, and (ii) the
denominator of which is the number of Shares outstanding on such day.
Counterparty agrees to indemnify and hold harmless Deutsche and its affiliates
and their respective officers, directors, employees, advisors, agents and
controlling persons (each, a “Section 16 Indemnified Person”) from and against
any and all losses (including losses relating to Deutsche’s hedging activities
as a consequence of becoming, or of the risk of becoming, a Section 16
“insider”, including without limitation, any forbearance from hedging activities
or cessation of hedging activities and any losses in connection therewith with
respect to the Transaction), claims, damages, judgments, liabilities and
expenses (including reasonable attorney’s fees), joint or several, to which a
Section 16 Indemnified Person may become subject, as a result of Counterparty’s
failure to provide Deutsche with a Repurchase Notice on the day and in the
manner specified in this paragraph, and to reimburse, upon written request, each
of such Section 16 Indemnified Persons for any reasonable legal or other
expenses incurred in connection with investigating, preparing for, providing
testimony or other evidence in connection with or defending any of the
foregoing. If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted against
the Section 16 Indemnified Person, such Section 16 Indemnified Person shall
promptly notify Counterparty in writing, and Counterparty, upon request of the
Section 16 Indemnified Person, shall retain counsel reasonably satisfactory to
the Section 16 Indemnified Person to represent the Section 16 Indemnified Person
and any others Counterparty may designate in such proceeding and shall pay the
fees and expenses of such counsel related to such proceeding. Counterparty shall
be relieved from liability to the extent that the Section 16 Indemnified Person
fails promptly to notify Counterparty of any action commenced against it in
respect of which indemnity may be sought hereunder; provided, that failure to
notify Counterparty (x) shall not relieve Counterparty from any liability
hereunder to the extent it is not materially prejudiced as a result thereof and
(y) shall not, in any event, relieve Counterparty from any liability that it may
have otherwise than on account of this indemnity agreement. Counterparty shall
not be liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, Counterparty agrees to indemnify any Section 16 Indemnified
Person from and against any loss or liability by reason of such settlement or
judgment. Counterparty shall not, without the prior written consent of the
Section 16 Indemnified Person, effect any settlement of any pending or
threatened proceeding in respect of which any Section 16 Indemnified Person is
or could have been a party and indemnity could have been sought hereunder by
such Section 16 Indemnified Person,

 

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unless such settlement includes an unconditional release of such Section 16
Indemnified Person from all liability on claims that are the subject matter of
such proceeding on terms reasonably satisfactory to such Section 16 Indemnified
Person. If the indemnification provided for in this paragraph is unavailable to
a Section 16 Indemnified Person or insufficient in respect of any losses,
claims, damages or liabilities referred to therein, then Counterparty, in lieu
of indemnifying such Section 16 Indemnified Person thereunder, shall contribute
to the amount paid or payable by such Section 16 Indemnified Person as a result
of such losses, claims, damages or liabilities. The remedies provided for in
this paragraph are not exclusive and shall not limit any rights or remedies that
may otherwise be available to any Section 16 Indemnified Person at law or in
equity. The indemnity and contribution agreements contained in this paragraph
shall remain operative and in full force and effect regardless of the
termination of the Transaction.

Alternative Calculations and Deutsche Payment on Early Termination and on
Certain Extraordinary Events. If Deutsche owes Counterparty any amount in
connection with the Transaction pursuant to Sections 12.2, 12.3 (and
“Consequences of Merger Events” above), 12.6, 12.7 or 12.9 of the Equity
Definitions (except in the case of an Extraordinary Event in which the
consideration or proceeds to be paid to holders of Shares as a result of such
event consists solely of cash) or pursuant to Section 6(d)(ii) of the Agreement
(except in the case of an Event of Default in which Counterparty is the
Defaulting Party or a Termination Event in which Counterparty is the Affected
Party, other than (x) an Event of Default of the type described in
Section 5(a)(iii), (v), (vi) or (vii) of the Agreement or (y) a Termination
Event of the type described in Section 5(b)(i), (ii), (iii), (iv), (v) or
(vi) of the Agreement that in the case of either (x) or (y) resulted from an
event or events outside Counterparty’s control) (a “Deutsche Payment
Obligation”), Counterparty shall have the right, in its sole discretion, to
require Deutsche to satisfy any such Deutsche Payment Obligation by delivery of
Termination Delivery Units (as defined below) by giving irrevocable telephonic
notice to Deutsche, confirmed in writing within one Scheduled Trading Day,
between the hours of 9:00 a.m. and 4:00 p.m. New York time on the Early
Termination Date or other date the transaction is terminated, as applicable
(“Notice of Deutsche Termination Delivery”). Within a commercially reasonable
period of time following receipt of a Notice of Deutsche Termination Delivery,
Deutsche shall deliver to Counterparty a number of Termination Delivery Units
having a cash value equal to the amount of such Deutsche Payment Obligation
(such number of Termination Delivery Units to be delivered to be determined by
the Calculation Agent as the number of whole Termination Delivery Units that
could be purchased over a commercially reasonable period of time with the cash
equivalent of such payment obligation). If the provisions set forth in this
paragraph are applicable, the provisions of Sections 9.8, 9.9, 9.11 (modified as
described above) and 9.12 of the Equity Definitions shall be applicable, except
that all references to “Shares” shall be read as references to “Termination
Delivery Units.”

“Termination Delivery Unit” means (a) in the case of a Termination Event, an
Event of Default or an Extraordinary Event (other than an Insolvency,
Nationalization or Merger Event), one Share or (b) in the case of an Insolvency,
Nationalization or Merger Event, a unit consisting of the number or amount of
each type of property received by a holder of one Share (without consideration
of any requirement to pay cash or other consideration in lieu of fractional
amounts of any securities) in such Insolvency, Nationalization or Merger Event.
If a Termination Delivery Unit consists of property other than cash or New
Shares and Counterparty provides irrevocable written notice to the Calculation
Agent on or prior to the Closing Date that it elects to receive cash, New Shares
or a combination thereof (in such proportion as Counterparty designates) in lieu
of such other property, the Calculation Agent shall replace such property with
cash, New Shares or a combination thereof as components of a Termination
Delivery Unit in such amounts, as determined by the Calculation Agent in its
discretion by commercially reasonable means, as shall have a value equal to the
value of the property so replaced. If such Insolvency, Nationalization or Merger
Event involves a choice of consideration to be received by holders, such holder
shall be deemed to have elected to receive the maximum possible amount of cash.

Rule 10b-18. Except as disclosed to Deutsche in writing prior to the date on
which the offering of the Convertible Notes was first announced (including, for
the avoidance of doubt, a confirmation entered into between Counterparty and
Deutsche relating to an accelerated share repurchase transaction entered into in
connection with the Convertible Notes offering), Counterparty represents and
warrants to Deutsche that it has not made any purchases of blocks by or for
itself or any of its Affiliated Purchasers pursuant to the one block purchase
per week exception in Rule 10b-18(b)(4) under the Exchange Act during each of
the four calendar weeks preceding such date (“Rule 10b-18 purchase,” “blocks”
and “Affiliated Purchaser” each as defined in

 

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Rule 10b-18 under the Exchange Act). Counterparty agrees and acknowledges that
it shall not, and shall cause its affiliates and Affiliated Purchasers not to,
directly or indirectly (including by means of a derivative instrument) enter
into any transaction (other than such accelerated share repurchase transaction)
to purchase any Shares during the period beginning on such date and ending on
the day on which Deutsche has informed Counterparty in writing that it has
completed all purchases of Shares or other transactions to hedge initially its
exposure to the Transaction. Deutsche shall inform Counterparty of such as soon
as practicable after it has completed all purchases of Shares or other
transactions to hedge initially its exposure to the Transaction.

Regulation M. Counterparty was not on the date on which the offering of the
Convertible Notes was first announced, has not since such date, and is not on
the date hereof, engaged in a distribution, as such term is used in Regulation M
under the Exchange Act, of any securities of Counterparty, other than a
distribution meeting the requirements of the exception set forth in Sections
101(b)(10) and 102(b)(7) of Regulation M under the Exchange Act. Counterparty
shall not, until the day on which Deutsche has informed Counterparty in writing
that it has completed all purchases of Shares or other transactions to hedge
initially its exposure to the Transaction, engage in any such distribution.

No Material Non-Public Information. On each day during the period beginning on
the date on which the offering of the Convertible Notes was first announced and
ending on the day on which Deutsche has informed Counterparty in writing that
Deutsche has completed all purchases of Shares or other transactions to hedge
initially its exposure with respect to the Transaction, Counterparty represents
and warrants to Deutsche that it is not aware of any material nonpublic
information concerning itself or the Shares.

Right to Extend. Deutsche may postpone any potential Exercise Date or postpone
or extend any other date of valuation or delivery with respect to some or all of
the relevant Note Hedging Units (in which event the Calculation Agent shall make
appropriate adjustments to the Settlement Amount for such Note Hedging Units),
if Deutsche determines, in its reasonable discretion, that such extension is
reasonably necessary or appropriate to preserve Deutsche’s hedging or hedge
unwind activity hereunder to enable Deutsche to effect purchases of Shares in
connection with its hedging, hedge unwind or settlement activity hereunder in a
manner that would, if Deutsche were Issuer or an affiliated purchaser of Issuer,
be in compliance with applicable legal, regulatory or self-regulatory
requirements, or with related policies and procedures applicable to Deutsche.

Transfer or Assignment. Counterparty may not transfer any of its rights or
obligations under the Transaction without the prior written consent of Deutsche,
such consent not to be unreasonably withheld or delayed. Deutsche may transfer
or assign all or a portion of its Note Hedging Units hereunder to any of its
affiliates without the consent of Counterparty, provided that Counterparty shall
have recourse to Deutsche in the event of the failure by the affiliate
transferee to perform any of such obligations hereunder. If, as determined in
Deutsche’s sole discretion, (x) its “beneficial ownership” (within the meaning
of Section 16 of the Exchange Act and rules promulgated thereunder) exceeds 8.5%
of Counterparty’s outstanding Shares and (y) Deutsche is unable, after
commercially reasonable efforts, to effect a transfer or assignment on pricing
terms and within a time period reasonably acceptable to it of all or a portion
of the Transaction pursuant to the preceding paragraph to reduce such
“beneficial ownership” below 8.5%, Deutsche may, without Counterparty’s prior
consent, transfer any of the rights or obligations of Deutsche to a third party
with a rating (or whose guarantor has a rating) for its long term, unsecured and
unsubordinated indebtedness of A+ or better by Standard & Poor’s Ratings
Services or its successor (“S&P”), or A1 or better by Moody’s Investors Service,
Inc. or its successor (“Moody’s”). If such transfer has not been effected on
pricing terms reasonably acceptable to Deutsche and within time period
reasonably acceptable to Deutsche, Deutsche may designate any Scheduled Trading
Day as an Early Termination Date with respect to a portion (the “Terminated
Portion”) of this Transaction, such that its “beneficial ownership” following
such partial termination will be approximately equal to but less than 8.5%. In
the event that Deutsche so designates an Early Termination Date with respect to
a portion of this Transaction, a payment shall be made pursuant to Section 6 of
the Agreement as if (i) an Early Termination Date had been designated in respect
of a Transaction having terms identical to this Transaction and a Number of Note
Hedging Units equal to the Terminated Portion, (ii) Counterparty shall be the
sole Affected Party with respect to such partial termination and (iii) such
Transaction shall be the only Terminated Transaction (and, for the avoidance of
doubt, the provisions set forth under the caption “Alternative Calculations and
Deutsche Payment on Early Termination and on Certain Extraordinary Events” shall
apply to any amount that is payable by Deutsche to Counterparty pursuant to this
sentence).

 

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Notwithstanding any other provision in this Confirmation to the contrary
requiring or allowing Deutsche to purchase, sell, receive or deliver any shares
or other securities to or from Counterparty, Deutsche may designate any of its
affiliates to purchase, sell, receive or deliver such shares or other securities
and otherwise to perform Deutsche’s obligations in respect of the Transaction
and any such designee may assume such obligations. Deutsche shall be discharged
of its obligations to Counterparty to the extent of any such performance.

Severability; Illegality. If compliance by either party with any provision of
the Transaction would be unenforceable or illegal, (a) the parties shall
negotiate in good faith to resolve such unenforceability or illegality in a
manner that preserves the economic benefits of the transactions contemplated
hereby and (b) the other provisions of the Transaction shall not be invalidated,
but shall remain in full force and effect.

Waiver of Jury Trial. EACH PARTY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY SUIT,
ACTION OR PROCEEDING RELATING TO THE TRANSACTION. EACH PARTY (I) CERTIFIES THAT
NO REPRESENTATIVE, AGENT OR ATTORNEY OF THE OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF SUCH A
SUIT, ACTION OR PROCEEDING, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(II) ACKNOWLEDGES THAT IT AND THE OTHER PARTY HAVE BEEN INDUCED TO ENTER INTO
THE TRANSACTION, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS PROVIDED HEREIN.

Early Unwind. In the event the sale of Convertible Notes is not consummated with
the initial purchasers thereof for any reason by the close of business in New
York on April 15, 2008 (or such later date as agreed upon by the parties) (April
15, 2008 or such later date as agreed upon being the “Early Unwind Date”), the
Transaction shall automatically terminate (the “Early Unwind”) on the Early
Unwind Date and (a) the Transaction and all of the respective rights and
obligations of Deutsche and Counterparty under the Transaction shall be
cancelled and terminated and (b) each party shall be released and discharged by
the other party from and agrees not to make any claim against the other party
with respect to any obligations or liabilities of the other party arising out of
and to be performed in connection with the Transaction either prior to or after
the Early Unwind Date. Deutsche and Counterparty represent and acknowledge to
the other that upon an Early Unwind, all obligations with respect to the
Transaction shall be deemed fully and finally discharged.

Governing law: The law of the State of New York.

Contact information. For purposes of the Agreement (unless otherwise specified
in the Agreement), the addresses for notice to the parties shall be:

(a) Counterparty

Endo Pharmaceuticals Holdings Inc.

100 Endo Boulevard

Chadds Ford, PA 19317

Attention: Chief Legal Officer

Telephone: 610-558-9800

Fax: 610-558-9684

(b) Deutsche

Deutsche Bank AG, London Branch

c/o Deutsche Bank Securities Inc.

60 Wall Street

New York, NY 10005

 

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Attention: Documentation Department

and

c/o Deutsche Bank Securities Inc.

60 Wall Street, NYC60-0425

New York, New York 10005-2858

Attn: Equity Capital Markets

Fax No.: 212-797-0058

Tel No.: 212-250-2717

 

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This Confirmation may be executed in several counterparts, each of which shall
be deemed an original but all of which together shall constitute one and the
same instrument.

Counterparty hereby agrees to check this Confirmation and to confirm that the
foregoing correctly sets forth the terms of the Transaction by signing in the
space provided below and returning to Deutsche a facsimile of the fully-executed
Confirmation to Deutsche at 44 113 336 2009. Originals shall be provided for
your execution upon your request.

We are very pleased to have executed the Transaction with you and we look
forward to completing other transactions with you in the near future.

Very truly yours,

 

DEUTSCHE BANK AG, LONDON BRANCH By:  

/s/ Paul Maley

Name:   Paul Maley Title:   Director By:  

/s/ Lee Frankenfield

Name:   Lee Frankenfield Title:   Managing Director

DEUTSCHE BANK SECURITIES INC.

acting solely as Agent in connection with this Transaction

By:  

/s/ Paul Maley

Name:   Paul Maley Title:   Director By:  

/s/ Lee Frankenfield

Name:   Lee Frankenfield Title:   Managing Director

Counterparty hereby agrees to, accepts and confirms the terms of the foregoing
as of the Trade Date.

 

ENDO PHARMACEUTICALS HOLDINGS INC. By:  

/s/ Charles A. Rowland, Jr.

Name:   Charles A. Rowland, Jr. Title:  

Executive Vice President,

Chief Financial Officer

and Treasurer