The confidential portions of this exhibit have been omitted and filed separately
with the Securities and Exchange Commission pursuant to a confidential treatment
request in accordance with Rule 24b-2 of the Securities Exchange Act of 1934, as
amended. REDACTED PORTIONS OF THIS EXHIBIT ARE INDICATED BY AN [###].
 
Amendment No. 2 to Distribution Agreement
 
This Amendment No. 2 to Distribution Agreement (the “Amendment”) is entered into
as of September 26, 2009 by and between OMP, Inc., a Delaware corporation
(“OMP”), and Cellogique Corporation, a California corporation
(“Distributor”).  All capitalized terms used but not otherwise defined herein
shall have the meanings assigned under the Distribution Agreement between OMP
and Distributor dated as of November 10, 2005, as amended October 23, 2006
(the “Original Agreement” and, collectively with, and as further amended by,
this Amendment, the “Agreement”).
 
Whereas, Distributor is the authorized distributor of certain OMP products in
the Territory (as defined in the Original Agreement); and
 
Whereas, each of OMP and Distributor wish to amend the pricing, payment and
certain other terms of the Original Agreement.
 
Now, Therefore, in consideration of the foregoing recitals and the mutual
promises hereinafter set forth, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Parties agree
as follows:
 
1. Amendment To Forecast Requirements.  Section 4.5 of the Original Agreement
shall be amended to read in full as follows:
 
(a) “4.5 Forecasts.  Distributor shall provide to OMP on a quarterly basis a
twelve (12) month rolling forecast of Distributor’s projected purchase orders
for each Product on the form attached hereto as Exhibit B. Distributor shall
submit forecasts to OMP on March 15 (for the twelve months commencing April 1),
June 15 (for the twelve months commencing July 1), September 15 (for the twelve
months commencing October 1) and December 15 (for the twelve months commencing
January 1) of each calendar year. The forecasts are for planning purposes only
and shall not be binding on Distributor or OMP.”
 
(b) Exhibit B to the Original Agreement shall be amended and replaced in full by
Exhibit B to this Amendment.
 
2. Amendment to Distributor Expense Provision.  Section 4.8 of the Original
Agreement shall be amended to read in full as follows:
 
“4.8  Distributor Expenses.  Except as otherwise provided in Exhibit A hereto,
Distributor assumes full responsibility for all of its own costs and expenses
incurred in carrying out its obligations under this Agreement, including but not
limited to all rents, salaries, commissions, advertising, translations of
documents and materials, demonstrations, travel and accommodations for the
employees, agents, representatives or other personnel of Distributor.”
 
3. Amendment To Required Periodic Reviews.
 
(a) Section 4.10 of the Original Agreement shall be amended to read in full as
follows:
 

 
 

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

 

“4.10 Bi-Quarterly Reviews and Reports.  Distributor and OMP shall participate
in at least two (2) meetings each calendar quarter to discuss (a): any
deviations from the forecasts for that quarter previously provided to OMP
pursuant to Section 4.5 of the Agreement of which Distributor has become aware,
and (b) plans for any marketing, sales, advertising campaigns, training events
or other promotional activities planned for that quarter as well as any future
quarters. Such meetings shall occur within the first two weeks of each quarter
and in the middle of each quarter, and may be conducted in person or via
telephone conference or other communications equipment by means of which all
persons participating in the meeting can hear each other. Distributor shall also
provide OMP with reports of its activities, competitor activities, other
information regarding the Products and the markets for the Products in the
Territory, business plans for distribution of the Products, and sales
achievements and objectives in such detail and with such frequency as OMP and
Distributor shall mutually agree.”
 
(b) Section 5.4 of the Original Agreement shall be amended to read in full as
follows:
 
“5.4  Bi-Quarterly Review. OMP agrees to participate with Distributor in the
bi-quarterly reviews to be conducted pursuant to Section 4.10 of this
Agreement.”
 
4. Amendment to Pricing Terms.
 
(a) Section 6.7 of the Original Agreement shall be amended to read in full as
follows:
 
“6.7 Price Changes; Notification.  Prices offered to Distributor shall be as set
forth on the amended Exhibit A hereto. For the two year period commencing on the
date of the Amendment and ending on the second anniversary of such date (the
“Initial Period”), OMP will not increase the Prices set forth on Exhibit A.
Thereafter, OMP may decrease the prices in Exhibit A at any time, in its sole
discretion. Any increase in Prices occurring after the Initial Period shall be
limited to one increase per year of not more than a [###]* percent ([###]*)
annual increase over the then prevailing Prices; provided, however, that such
limit shall not apply upon mutual agreement of the Parties if a greater increase
is required as a result of increases in OMP’s manufacturing costs or changes in
market conditions. OMP shall give Distributor written notice of any proposed
increase to the Prices at least [###]* in advance of such increase.”
 
(b) The last sentence of Section 7.1 of the Original Agreement shall be amended
to read in full as follows:
 
“Subject to the price change limitations contained in Section 6 hereof and any
other provisions thereof, OMP may change the Prices in Exhibit A at any time.”
 

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

 
* Subject to confidential treatment request

 
2 

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

 

 
(c) Exhibit A to the Original Agreement shall be amended and replaced in full by
Exhibit A to this Amendment.
 

5. Amendment To Payment Terms.   The first sentence of Section 7.2 of the
Original Agreement shall be amended to read in full as follows:
 
“7.2 Payment Terms.  OMP shall extend credit, and full payment shall be due
[###]* days from the date of the OMP invoice.
 
6. Miscellaneous.  Except as specifically amended by this Amendment, the terms
and conditions of the Original Agreement shall remain in full force and
effect.  This Amendment may be executed in counterparts, each of which shall be
deemed an original document, and all of which, together with this writing, shall
be deemed one instrument.
 

 
[SIGNATURES APPEAR FOLLOWING PAGE]
 

 

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

 
* Subject to confidential treatment request

 
3 

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

 

In Witness Whereof, the Parties hereto have executed this Amendment in duplicate
originals by their duly authorized officers or representatives.
 
OMP, Inc.
Cellogique Corporation

 

         
/s/ Preston Romm
   
/s/ Mazen F. Youssef
 
Name Preston Romm
   
Name Mazen F. Youssef
 
Title Chief Financial Officer
   
Title President
 

 

 

 
4 

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

 

EXHIBIT A
 
TO THE DISTRIBUTION AGREEMENT
BETWEEN OMP, INC.
AND
CELLOGIQUE CORPORATION

A.                       PRODUCTS.
 
OMP skin care products subject to this Distribution Agreement include:
 
Blue Peel
CLENZIderm
ELASTIderm
Nu-Derm
Obagi-C Rx
Professional C
Rosaclear
Tretinoin
 
B.                       TERRITORY.
 
The Territory of Distributor shall be the country(ies) of Syria, Egypt, Lebanon,
Jordan, Saudi Arabia, United Arab Emirates, Bahrain, Kuwait, Iraq, Oman, Yemen,
Libya, Tunisia, Morocco, Turkey, Cypress, Iran, Sudan, Algeria, Qatar, and
Israel, including, without limitation, any territories and possessions of any of
the foregoing countries, and any other geographic area designated by OMP and
agreed to by Distributor for the exercise of Distributor’s rights and
obligations in the Agreement.
 
C.                       PRICES AND MARKETING INCENTIVES.

The prices set forth below shall go into effect immediately upon execution of
the Amendment, and shall also be retroactively applied to all purchase orders
submitted by Distributor to OMP during the three months ended June 30,
2009.  All prices in the following table are in U.S. dollars:
 
 

Obagi Product
 
Cellogique Pricing
         
Nu-Derm Products
     
Gentle Cleanser
    [### ]*
Foaming Gel
    [### ]*
Toner
    [### ]*
Clear
    [### ]*
ClearFx
    [### ]*
Exfoderm
    [### ]*
Exfoderm Forte
    [### ]*

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

 
* Subject to confidential treatment request

A-1
 
 

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

 

Obagi Product
 
Cellogique Pricing
 
Nu-Derm Products (cont.)
     
Blender
    [### ]*
BlendFx
    [### ]*
Sunfader
    [### ]*
Healthy Skin Protection
    [### ]*
Physical UV Block SPF 32
    [### ]*
Tolereen
    [### ]*
Comfort Gel
    [### ]*
Action
    [### ]*
Eye Cream
    [### ]*
Travel Set (Normal to Oily)
    [### ]*
Travel Set (Normal to Dry)
    [### ]*
Starter Set (Normal to Oily)
    [### ]*
Starter Set (Normal to Dry)
    [### ]*          
Conditioning Control Kit
       
C & E Non-Surgical (Travel Size)
    [### ]*
C & E Surgical (Travel Size)
    [### ]*
C & E Non-Surgical (Full Size)
    [### ]*
C & E Surgical (Full Size)
    [### ]*          
Obagi CRx
       
Cleansing Gel
    [### ]*
Clarifying Serum
    [### ]*
Exfoliating Day Lotion
    [### ]*
Therapy Night Cream
    [### ]*
Sun Guard SPF 30
    [### ]*
CRX Starter Set
    [### ]*          
Professional-C
       
Professional-C 5%
    [### ]*
Professional-C 10%
    [### ]*
Professional-C 15%
    [### ]*
Professional-C 20%
    [### ]*          
Elastiderm
       
Decolletage
    [### ]*
Skin Lightening Complex
    [### ]*
Wrinkle Reducing Lotion
    [### ]*
Elastiderm Cream
    [### ]*
Elastiderm Gel
    [### ]*          
Clenziderm
       
Starter Set (Normal to Dry)
    [### ]*
Cream Cleanser
    [### ]*

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

 
* Subject to confidential treatment request

A-2
 
 

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

 

Obagi Product
 
Cellogique Pricing
 
Clenziderm (cont.)
     
Therapeutic Lotion
    [### ]*
Therapeutic Moisturizer
    [### ]*
Starter Set (Normal to Oily)
    [### ]*
Daily Care Foaming Cleanser
    [### ]*
Pore Therapy
    [### ]*
Serum Gel
    [### ]*          
Blue Peel
       
Blue Peel Kit,
    [### ]*
Cleanser
    [### ]*          
Rosaclear System
       
Gentle Cleanser
    [### ]*
Hydrating Complexion Corrector
    [### ]*
Skin Balancing Sun Protection
    [### ]*          
Tretinoin
       
Tretinoin Cream .025% (20 gm)
    [### ]*
Tretinoin Cream .05% (20 gm)
    [### ]*
Tretinoin Cream .1% (20 gm)
    [### ]*
Tretinoin Gel .01 (15 gm)
    [### ]*
Tretinoin Gel .025% (15 gm)
    [### ]*

Pricing Protection

If at any time during the Initial Period, OMP shall sell any of the Products
under similar quantities and delivery conditions to another third-party
distributor at a price below that stated above, OMP shall immediately extend
such lower price to Distributor. Following the Initial Period, OMP will continue
to extend the pricing protection set forth above to Distributor until such time
as OMP’s net sales to Distributor during any given year represent less than
[###]* percent ([###]*) of all of OMP’s international net sales for that year,
at which time such pricing protection shall terminate.

Marketing Incentives

During each calendar quarter within the Initial Period, OMP shall provide
marketing incentives to Distributor having a value equal to [###]* percent
([###]*) of the net invoice prices for all Products purchased by Distributor
during the prior calendar quarter. Such incentives may be provided in the form
of payment or reimbursement of marketing and advertising expenses, provision of
representatives or other personnel for marketing or training events, payment of
travel costs, accommodations and other expenses for such representatives or
personnel, or any other form as OMP and Distributor shall mutually agree (the
“Marketing Incentives”). The value of any such marketing incentives provided

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

 
* Subject to confidential treatment request

A-3
 
 

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

 

in the form of personnel, training or other non-cash manner shall be determined
by the mutual agreement of OMP and distributor. In addition, OMP shall provide
Distributor with invoices to document any travel costs, accommodations or other
sums expended by OMP as part of such Marketing Incentives (which shall be
calculated only at OMP’s actual out-of-pocket cost). If, during any particular
calendar quarter, Distributor fails to use the entire value of the Marketing
Incentives allocated to it during that quarter, any excess value shall be
applied to the next calendar quarter and all such excess values shall continue
to accrue until used by Distributor.

Notwithstanding the foregoing, all invoices submitted by OMP to Distributor
shall be paid in full by Distributor. To receive the Marketing Incentives,
Distributor must submit  a detailed memo to OMP setting forth the particular
marketing, advertising or promotional campaign or training event for which it is
seeking assistance, the relevant Product(s) subject to such campaign or
event,  the proposed date(s) for such campaign or event, the intended audience
for such campaign or event, a detailed list of the costs associated with such
campaign or event, the percentage of the campaign or event that will focus on
the Products, and any other information reasonably requested by OMP. Copies of
actual advertisements or materials to be used for such campaign or event shall
be attached to the memo. Upon receipt of such memo by OMP, OMP shall provide
Marketing Incentives to Distributor as described above.

Following the Initial Period, the Parties agree to enter into good faith
negotiations with respect to a marketing incentive program, which shall have
such terms and conditions as the Parties mutually agree upon.

It is acknowledged and agreed that Distributor has been and shall continue to be
authorized to use any OMP and Obagi logos on its advertising, medical centers
and retail shops throughout the term of this Distribution Agreement.

Sample Product
 
In addition to the marketing incentives noted above, the Distributor shall be
entitled to receive sample product equal to [###]* percent ([###]*) of the net
purchase price for any given order placed. The expressed purpose of this product
is solely for providing free product sampling to physicians to promote new
accounts, trial and ongoing personal use by physicians and their staff to the
extent applicable. The Distributor agrees that such product will be used only
for such purpose, will be separately tracked and will not be re-sold by
Distributor.
 
D.                       DISTRIBUTOR’S MINIMUM PURCHASE REQUIREMENT.
 
Distributor’s Minimum Purchase Requirements shall be [###]* million in 2010, and
shall increase [###]* each year thereafter ([###]* million in 2011,
[###]* million in 2012, etc.).

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

 
* Subject to confidential treatment request

A-4
 
 

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

 

EXHIBIT B

TO THE DISTRIBUTION AGREEMENT
BETWEEN OBAGI MEDICAL PRODUCTS, INC.
AND
CELLOGIQUE CORPORATION

Rolling 4-Q Forecast by Units

Distributor’s Name:__________________________

 

 
QUARTER 1
QUARTER 2
QUARTER 3
QUARTER 4
Product
M 1
M2
M3
Total
M1
M2
M3
Total
M1
M2
M3
Total
M1
M2
M3
Total
Nu-Derm
                               
Gentle Cleanser
                               
Foaming Gel
                               
Toner
                               
Clear
                               
ClearFx
                               
Exfoderm
                               
Exfoderm Forte
                               
Blender
                               
BlendFx
                               
Sunfader
                               
Healthy Skin Protection
                               
Physical UV Block SPF 32
                               
Tolereen
                               
Comfort Gel
                               
Action
                               
Eye Cream
                               
Travel Set (Normal to Oily)
                               
Travel Set (Normal to Dry)
                               

B-1
 
 

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

 

 
QUARTER 1
QUARTER 2
QUARTER 3
QUARTER 4
Product
M 1
M2
M3
Total
M1
M2
M3
Total
M1
M2
M3
Total
M1
M2
M3
Total
Starter Set (Normal to Oily)
                               
Starter Set (Normal to Dry)
                               
Conditioning Control Kit
                               
C & E Non-Surgical (Travel Size)
                               
C & E Surgical (Travel Size)
                               
C & E Non-Surgical (Full Size)
                               
C & E Surgical (Full Size)
                               
Obagi CRx
                               
Cleansing Gel
                               
Clarifying Serum
                               
Exfoliating Day Lotion
                               
Obagi CRx (cont.)
                               
Therapy Night Cream
                               
Sun Guard SPF 30
                               
CRX Starter Set
                               
Professional-C
                               
Professional-C 5%
                               
Professional-C 10%
                               
Professional-C 15%
                               
Professional-C 20%
                               
Elastiderm
                               
Decolletage
                               
Skin Lightening Complex
                               
Wrinkle Reducing Lotion
                               
Elastiderm Cream
                               
Elastiderm Gel
                               
Clenziderm
                               

B-2
 
 

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

 

 
QUARTER 1
QUARTER 2
QUARTER 3
QUARTER 4
Product
M 1
M2
M3
Total
M1
M2
M3
Total
M1
M2
M3
Total
M1
M2
M3
Total
Starter Set (Normal to Dry)
                               
Cream Cleanser
                               
Therapeutic Lotion
                               
Therapeutic Moisturizer
                               
Starter Set (Normal to Oily)
                               
Daily Care Foaming Cleanser
                               
Pore Therapy
                               
Serum Gel
                               
Blue Peel
                               
Blue Peel Kit,
                               
Cleanser
                               
Rosaclear System
                               
Gentle Cleanser
                               
Hydrating Complexion Corrector
                               
Skin Balancing Sun Protection
                               
Tretinoin
                               
Tretinoin Cream .025% (20 gm)
                               
Tretinoin Cream .05% (20 gm)
                               
Tretinoin Cream .1% (20 gm)
                               
Tretinoin Gel .01 (15 gm)
                               
Tretinoin Gel .025% (15 gm)
                               

B-3
 
 

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