Exhibit 10.31

LICENSE AGREEMENT

This License Agreement (this “Agreement”) is made effective as of November 1,
2007 (the “Effective Date”) by and between NexMed Inc., a Nevada corporation
(“NexMed”), and Warner Chilcott Company, Inc., a Puerto Rico corporation
(“Warner”). NexMed and Warner are each hereinafter referred to individually as a
“Party” and together as the “Parties.”

WHEREAS, NexMed Controls (as that term is hereafter defined) certain proprietary
patent, know-how and technology rights related to a pharmaceutical formulation
containing alprostadil for the treatment of erectile dysfunction; and

WHEREAS, Warner desires to obtain a license from NexMed to develop and
commercialize the Licensed Products (as hereafter defined); and

WHEREAS, NexMed desires to grant such license to Warner on the terms and subject
to the conditions of this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants contained herein, and
for other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the Parties hereby agree as follows:
 
1. DEFINITIONS

Whenever used in this Agreement with an initial capital letter, the terms
defined in this Section 1 shall have the meanings specified.
 
1.1. “Affiliate” shall mean any corporation, firm, limited liability company,
partnership or other entity that controls or is controlled by or is under common
control with a Party to this Agreement. For purposes of this Section 1.1,
“control” means ownership, directly or indirectly through one or more
Affiliates, of fifty percent (50%) or more of the shares of stock entitled to
vote for the election of directors, in the case of a corporation, or fifty
percent (50%) or more of the equity interests in the case of any other type of
legal entity, status as a general partner in any partnership, or any other
arrangement whereby a person or entity controls or has the right to control the
board of directors or equivalent governing body of a corporation or other
entity, or otherwise has the ability to direct the affairs or operations of such
person.
 
1.2. “API” shall mean alprostadil.

1.3. “Approval” shall mean, with respect to any Licensed Product, approval from
the FDA (as hereafter defined) for the marketing, use and sale of the Licensed
Product in the Territory.

1.4. “Commercially Reasonable Efforts” means, with respect to a Party, efforts
and resources comparable to those undertaken by pharmaceutical companies of
similar size and scope as such Party, as applicable, to pursue intellectual
property protection for, Develop, manufacture, market, sell and distribute a
pharmaceutical product owned by it or to which it has rights, which is of
similar overall market potential at a similar stage in its product lifecycle,
taking into account, inter alia, the competitiveness of the marketplace, the
proprietary position of the product, the profitability of the product and other
relevant factors.
 

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1.5. “Confidential Information” shall mean with respect to a Party all trade
secrets, processes, formulae, data, know-how, improvements, inventions, chemical
materials, assays, techniques, marketing plans, strategies, customer lists, or
other information that has been created, discovered, or developed by such Party,
or has otherwise become known to such Party, or to which rights have been
assigned or licensed to such Party, as well as any other information and
materials that are deemed confidential or proprietary to or by such Party
(including, without limitation, all information and materials of such Party’s
customers and any other Third Party and their consultants), in each case that
are disclosed by such Party to the receiving Party, whether orally, visually, in
writing or by way of any other media, that if disclosed in tangible form is
marked “confidential,” or if disclosure is not in tangible form, the disclosing
Party has notified the receiving Party at the time of disclosure that such
disclosure is confidential and summarized such disclosure in writing, marking
the summary “confidential” and submitting it to the receiving Party (or, if
applicable, to such of the receiving Party’s Affiliates or sublicensees to whom
disclosure has been made) within thirty (30) days of the disclosure.
Confidential Information shall not include any such information, data or
materials to the extent that the receiving Party can demonstrate that such
information, (a) as of the date of disclosure is known to the receiving Party or
its Affiliates other than by virtue of a prior confidential disclosure to the
receiving Party or its Affiliates; (b) as of the date of disclosure is, or
subsequently becomes, publicly known, through no fault or omission of the
receiving Party or its Affiliates; (c) is obtained from a Third Party having a
lawful right to make such disclosure free from any obligation of confidentiality
to the disclosing Party; or (d) is independently developed by or for the
receiving Party or its Affiliates without reference to or reliance upon any
Confidential Information of the disclosing Party.

1.6. “Contract Year” shall mean each successive period of four consecutive
calendar quarters, with the first such Contract Year beginning on the first day
of the first full calendar quarter that begins after the Effective Date.

1.7. “Control” or “Controlled” shall mean with respect to any Technology or
Patent Rights (as such terms are defined hereunder), the ownership of the
intellectual property rights in and to such Technology or Patent Rights, or the
possession by a Party of rights under such Technology or Patent Rights
sufficient to permit it to grant licenses or sublicenses to such Technology or
Patent Rights as provided for herein, in each case without violating the terms
of any legally binding agreements between such Party and any Third Party.

1.8. “Development” or “Develop” means, with respect to a Licensed Product, all
clinical and other development activities undertaken to obtain Approval of such
Licensed Product in accordance with this Agreement. When used as a verb,
“Developing” means to engage in Development and “Developed” shall have a
corresponding meaning.
 
1.9. “Divided Patent Rights” shall mean the Patent Rights set forth on Exhibit B
hereto and any Licensed Patent Rights other than the Undivided Patent Rights.

1.10. “FDA” shall mean the United States Food and Drug Administration and any
successor agency or authority thereto. 
 
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1.11. “Field” shall mean the topical treatment of erectile dysfunction.
 
1.12. “First Commercial Sale” shall mean the date of the first arm’s length
transaction, transfer or disposition for value to a Third Party of a Licensed
Product by or on behalf of Warner or any Affiliate or Sublicensee of Warner. 

1.13. “Generic Product” shall mean any Third Party product that contains the
API, is identical to the Licensed Product in strength, dosage form and route of
administration, is bioequivalent to the Licensed Product and is approved by the
FDA as an AB-rated equivalent (as defined in the 27nd edition of Approved Drug
Products with Therapeutic Equivalence Evaluations issued by the United States
Department of Health and Human Services) to the Licensed Product.

1.14. “Licensed Know-How” shall mean any Technology (as hereafter defined) that
is Controlled by NexMed as of the Effective Date or at any time thereafter that
is necessary or useful for Warner to Develop, have Developed, make, have made,
use, have used, sell, distribute for sale, have distributed for sale, offer for
sale, have sold, import or have imported the Licensed Products and any NexMed
Improvements.
 
1.15. “Licensed Patent Rights” shall mean any Patents Rights under the Control
of NexMed as of the Effective Date, or at any time thereafter, that cover
Licensed Product or any NexMed Improvements.
 
1.16. “Licensed Product” shall mean any form or dosage of a pharmaceutical
product for use in the Field that contains the API as an active ingredient.
 
1.17. “NDA” shall mean a new drug application (as defined in Title 21 of the
United States Code of Federal Regulations, as amended from time to time), or
supplement thereto, filed with the FDA, seeking regulatory approval to market
and sell any Licensed Product in the Territory in the Field.

1.18. “Net Sales” shall mean the gross invoiced sales price for all Licensed
Products sold by Warner, its Affiliates or Sublicensees to Third Parties
throughout the Territory during a reporting period, less the following amounts
actually incurred or paid by Warner or its Affiliates or Sublicensees during
such reporting period with respect to sales of Licensed Products: (a) allowances
for normal and customary trade, quantity and cash discounts, rebates,
chargebacks; (b) fees, reimbursements or similar payments or adjustments granted
or paid to wholesalers or other distributors, buying groups, healthcare
insurance carriers or other similar persons; (c) transportation, shipping,
customs duties, insurance and postage charges included in the billing amount, if
paid by Warner, any Warner Affiliate or any Sublicensee; (d) credits or
allowances actually granted for damaged goods, recalls, returns or rejections
(including, but not limited to, wholesaler, distributor and retailer returns) of
Licensed Products or for retroactive price reductions; (e) any payment,
allowance or credit to any governmental entity, including Federal or state
Medicaid, Medicare or similar program; (f) actual write-offs for bad debts and
(g) sales, use, excise, value-added and other taxes (other than income taxes) or
governmental charges included in the billing amount, in each case, determined in
accordance with United States generally accepted accounting principles (“GAAP”).
 
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If any Licensed Products are sold to Third Parties in transactions that are not
at arm’s length between the buyer and seller, or for consideration other than
cash, then the gross amount to be included in the calculation of Net Sales for
such sales shall be the amount that would have been invoiced had the transaction
been conducted at arm’s length, which amount shall be determined, whenever
possible, by reference to the average selling price of the relevant Licensed
Product in arm's-length transactions at the time of sale. If Warner or its
Affiliates or Sublicensees sell Licensed Products to a Third Party who also
purchases other products or services from Warner or its Affiliates or
Sublicensees, Warner shall not, and shall require its Affiliates and
Sublicensees not to, (i) bundle or include any Licensed Product as part of any
incentive programs, chargebacks, disease management programs or similar programs
based on multiple product offerings or (ii) discount or price any Licensed
Product, in the case of either of the foregoing clauses (i) or (ii), such that
the applicable rebate, discount, other form of reimbursement for, or the price
of, such Licensed Product in such arrangement is inconsistent with the rebate,
discount, or other form of reimbursement for, or price of, such Licensed Product
when sold separately to such Third Party from any such other products or
services sold to such Third Party.

1.19. “NexMed Improvement” shall mean any change in the formulation,
ingredients, preparation, presentation, means of delivery, dosage, package of,
manufacture, or any new or expanded uses of the Licensed Product in the Field
developed during the term of this Agreement by or on behalf of NexMed.
 
1.20. “OTC Product” shall mean a Licensed Product for sale over-the-counter.

1.21. “Patent Rights” shall mean all rights arising under patents or patent
applications (including any patents issuing therefrom), as well as any
substitutions, continuations, continuations-in-part, divisionals and all
reissues, renewals, reexaminations, extensions, supplementary protection
certificates, confirmations, revalidations, registrations or patents of addition
in connection with any of the foregoing.

1.22. “Pre-Notification Room Temperature Formulation Development Activities”
shall mean all Development activities conducted by NexMed during the period from
the Effective Date until the Room Temperature Formulation Notification Date with
respect to the Room Temperature Formulation.

1.23. “Refrigerated Formulation” shall mean a formulation of the Licensed
Product that is manufactured, distributed, stored and sold under refrigeration.

1.24. “Refrigerated Formulation NDA” shall mean an NDA with respect to the
Refrigerated Formulation.

1.25. “Room Temperature Formulation” shall mean a formulation of the Licensed
Product that is manufactured, distributed, stored and sold at room temperature.

1.26. “Room Temperature Formulation NDA” shall mean an NDA with respect to the
Room Temperature Formulation.
 
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1.27. “Sublicense” shall mean each sublicense agreement entered into by Warner
pursuant to Section 2.2 with respect to a Licensed Product. 
 
1.28. “Sublicensee” shall mean any Third Party or Affiliate of Warner to whom
Warner grants a Sublicense of the rights granted to Warner under this Agreement,
as provided under Section 2.2.
 
1.29. “Technology” shall mean and include, whether or not patentable, any and
all proprietary ideas, inventions, discoveries, Confidential Information,
biologic materials, data, results, formulae, designs, specifications, methods,
processes, formulations, techniques, ideas, know-how, technical information
(including, without limitation, structural and functional information), process
information, pre-clinical information, clinical information, and any and all
proprietary biological, chemical, pharmacological, toxicological, pre-clinical,
clinical, assay, control and manufacturing data and materials.
 
1.30. “Term” shall have the meaning set forth in Section 9 hereof.
 
1.31. “Territory” shall mean the United States of America, including its
possessions and territories.
 
1.32. “Third Party” shall mean any person or entity other than Warner, NexMed
and their respective Affiliates.
 
1.33. “Undivided Patent Rights” shall mean the Patent Rights set forth on
Exhibit C hereto and any Licensed Patent Rights that relate solely to the
Licensed Products.

1.34. “Valid Claim” shall mean a claim that has been allowed or is contained in
an issued patent or pending patent application, which claim has not lapsed, been
canceled, or become abandoned and which claim has not been declared invalid or
unenforceable by an unappealable decision of a court of competent jurisdiction.

1.35. “Warner Improvement” shall mean any change in the formulation,
ingredients, preparation, presentation, means of delivery, dosage, package of,
manufacture, or any new or expanded uses of the Licensed Product in the Field
developed during the term of this Agreement by or on behalf of Warner.
 
2. GRANT OF RIGHTS
 
2.1. License to Warner. Subject to the terms and conditions of this Agreement,
NexMed grants to Warner an exclusive (even as to NexMed and its Affiliates but
subject to Section 2.5) license under the Licensed Know-How and Licensed Patent
Rights to Develop, have Developed, make, have made, use, have used, sell,
distribute for sale, have distributed for sale, offer for sale, have sold,
import or have imported Licensed Products in the Field in the Territory.

2.2. License to NexMed. Warner hereby grants to NexMed a fully paid-up,
exclusive license under any Warner Improvements and Joint Inventions to develop,
manufacture, use, sell, offer for sale and import products including Licensed
Products (i) outside the Territory and (ii) inside the Territory outside the
Field, including the right to grant sublicenses.
 
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2.3. Right to Sublicense. Warner shall have the right to grant sublicenses under
the exclusive license granted pursuant to Section 2.1 to an Affiliate of Warner.
In the event Warner intends to grant to a Third Party a sublicense of the rights
granted hereunder, it shall provide written notice to NexMed of its intention to
appoint or designate a sublicensee, including a reasonably detailed description
of the scope and nature of such sublicense. In connection with the grant of any
permitted sublicense hereunder, Warner shall ensure that each of its Affiliates
and Sublicensees accepts and complies with all of the terms and conditions of
this Agreement as if such Affiliates or Sublicensees were a party to this
Agreement and Warner shall guarantee and remain obligated for the performance
(or failure of performance) of any Affiliate or Sublicensee hereunder, including
by way of example only and not limitation, for the payment to NexMed of its
milestone and royalty obligations as described in Section 5 hereof.

2.4. Non-Compete. During the Term, except as contemplated by this Agreement,
neither Party nor their respective Affiliates, directly or indirectly or with or
through a Third Party, shall develop, make, use, promote, distribute or sell a
pharmaceutical product in the Field in the Territory.

2.5. Retained Rights and License to NexMed. Except as expressly provided
hereunder, NexMed reserves all other rights in and to the Licensed Know-How and
Licensed Patent Rights. Warner hereby grants NexMed a non-exclusive, worldwide,
royalty-free license under the Licensed know-How and Licensed Patent Rights
solely to the extent necessary to allow NexMed to fulfill its obligations to
Develop, manufacture and supply Licensed Products under this Agreement.

2.6. Right of Reference. Each Party and its Affiliates will, upon reasonable
request, provide the other Party with a right of reference to any filings with
the FDA related to the Licensed Product including, but not limited to, drug
master files.

2.7. OTC Product. If at any time during the Term the JSC determines in good
faith that it is reasonably likely that an OTC Product could be (i) manufactured
under a commercially viable manufacturing process and (ii) sold in compliance
with applicable law then Warner shall notify NexMed within ninety (90) days of
such determination if it intends to Develop and commercialize such OTC Product
(such notice, the “OTC Commercialization Notice”). Following delivery of the OTC
Commercialization Notice, Warner shall use Commercially Reasonable Efforts to
Develop and commercialize the OTC Product as promptly as practicable.
Notwithstanding the foregoing, if Warner fails to provide the OTC
Commercialization Notice within the period described in this Section 2.7, the
rights granted to Warner to Develop and commercialize the OTC Product in the
Field and in the Territory under this Agreement shall revert to NexMed and
NexMed shall thereafter have the unencumbered right to grant one or more Third
Parties the right to develop and commercialize the OTC Product.
 
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3. DEVELOPMENT, REGULTORY APPROVAL AND COMMERCIALIZATION OF LICENSED PRODUCTS.
 
3.1. Regulatory Approval for Refrigerated Formulation NDA. NexMed will use
Commercially Reasonable Efforts to obtain Approval of the Refrigerated
Formulation NDA as promptly as practicable following the Effective Date. In the
event the Parties determine that additional Development is required following
submission of the Refrigerated Formulation NDA to the FDA in order to obtain
Approval of such submission, such Development shall be conducted by NexMed at
the direction of the JSC (as hereafter defined) in accordance with Section 3.2
and Warner shall reimburse NexMed for all costs and expenses (other than any FDA
filing fees with respect to the Refrigerated Formulation NDA) relating to such
Development, including any amounts paid to a contract research organization
engaged by NexMed to perform such Development. Warner shall determine the nature
and extent of any improvements, upgrades, personnel changes or other
modifications that are necessary to enable the NexMed manufacturing facility to
receive all required approvals relating to the FDA pre-approval inspection (the
“PAI”) conducted in connection with obtaining Approval of the Refrigerated
Formulation NDA (collectively, the “PAI Upgrades”). Warner shall use
Commercially Reasonable Efforts to timely conduct such PAI Upgrades in advance
of the PAI and NexMed shall provide reasonable assistance and cooperation to
facilitate the PAI Upgrades. Warner shall bear the cost of the PAI Upgrades.

3.2. Development.

3.2.1.  JSC. All Development (other than that Pre-Notification Room Temperature
Formulation Development Activities) with respect to the Licensed Products shall
be conducted at the direction of a joint steering committee (the “JSC”) that
shall be established by the Parties as promptly as practicable after the
Effective Date. The JSC shall (i) oversee all Development in connection with
obtaining Approval of the Refrigerated Formulation NDA and (ii) in the event
Warner determines to proceed with the Development of the Room Temperature
Formulation in accordance with Section 3.2.3, prepare a Development plan with
respect to the Room Temperature Formulation and oversee the Development thereof
and the preparation and filing of the Room Temperature Formulation NDA. The JSC
shall consist of six (6) members, three (3) nominated by each Party. Each Party
may designate a substitute for a member nominated by it, who is unable to be
present at a meeting. Meetings of the JSC shall be held on a quarterly basis, or
at such other interval as may be agreed between the Parties. The JSC will be
chaired by one of the Warner designated representatives (the “Chair”). Meetings
shall be held alternately at the offices of Warner or NexMed. The JSC may be
convened, polled or consulted from time to time by means of telecommunication or
correspondence. The meetings of the JSC shall be documented in written minutes
to be approved by both Parties. Each Party shall bear its own costs for
participation in the JSC. At each JSC meeting the NexMed representatives shall
provide an update with respect to all material aspects of any ongoing
Development and regulatory filings. If there is a material change with respect
to such updates after any such meeting, NexMed will promptly notify Warner
thereof.

3.2.2. JSC Decisions. The JSC members shall use reasonable efforts to reach
agreement on any and all matters. In the event that, despite such reasonable
efforts, agreement on a particular matter cannot be reached by the JSC, then the
Chair of the JSC shall have the right to make the final decision on such matter,
but shall only exercise such right in good faith after full consideration of the
positions of both Parties; provided, however, that NexMed shall not be required
to provide resources or expertise beyond its reasonable capabilities,
notwithstanding the fact that Warner is required to reimburse NexMed for such
Development costs and expenses.
 
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3.2.3. Room Temperature Formulation.

3.2.3.1.  NexMed shall provide Warner with reasonably detailed summaries of all
Pre-Notification Room Temperature Formulation Development Activities at such
times as Warner shall reasonably request.

3.2.3.2.  In the event Warner determines, in its sole discretion, to proceed
with the Development and commercialization of the Room Temperature Formulation,
Warner shall notify NexMed in writing (such notice, the “Room Temperature
Formulation Development Notice”) on or prior to the date that is 30 days
following Approval of the Refrigerated Formulation NDA (such date, the “Room
Temperature Formulation Notification Date”). Thereafter, the Parties shall
promptly enter into good faith discussions in order to determine mutually
acceptable product labeling with respect to the Room Temperature Formulation
NDA. Following receipt of the Room Temperature Formulation Development Notice,
NexMed shall provide Warner with reasonably detailed documentation of all
expenses incurred by NexMed relating to Pre-Notification Room Temperature
Formulation Development Activities and Warner shall promptly reimburse NexMed
for all costs and expenses relating to such Development, including any amounts
paid to a contract research organization engaged by NexMed to perform such
Development. Following receipt of the Room Temperature Formulation Development
Notice (i) all Development thereafter conducted with respect to the Room
Temperature Formulation shall be conducted by NexMed at the direction of the JSC
in accordance with Section 3.2 and Warner shall reimburse NexMed for (A) all
costs and expenses relating to such Development, including any amounts paid to a
contract research organization engaged by NexMed to perform such Development and
(B) any filing fees paid to the FDA with respect to the Room Temperature
Formulation NDA and (ii) at the direction of the JSC in accordance with Section
3.2, NexMed will use commercially reasonable efforts to prepare, submit and
obtain Approval of a Room Temperature Formulation NDA that reflects the labeling
agreed by the Parties, as promptly as practicable. For the avoidance of doubt,
it is understood that Warner shall only be responsible to reimburse NexMed for
Pre-Notification Room Temperature Formulation Development Activities if Warner
delivers the Room Temperature Formulation Development Notice and in no instance
shall Warner be responsible to reimburse NexMed for Development conducted prior
to the Effective Date. The Party manufacturing the Room Temperature Formulation
shall be responsible for payment to the FDA of any annual fees on establishments
under the Prescription Drug User Fee Act (“PDUFA”) with respect to such Party’s
manufacturing facility for so long as such Party manufactures the Room
Temperature Formulation.

3.3. FDA Meetings and Submissions. NexMed shall own all regulatory filings and
Approvals for all Licensed Products in the Territory and NexMed shall be
responsible for and shall control the regulatory strategy and interactions with
regulatory authorities for all Licensed Products in the Territory and shall be
the designated point of contact with such regulatory authorities, it being
understood that NexMed shall consult with Warner with respect to such strategy
and interactions and will consider in good faith any Warner recommendations
relating thereto. Warner shall be entitled to participate in all meetings and
discussions with the FDA relating to the Licensed Products. Prior to submitting
any correspondence or other information relating to the Licensed Products to the
FDA (an “FDA Submission”), NexMed shall (i) provide Warner with a copy of the
FDA Submission and (ii) in the case of a material FDA Submission, provide Warner
with a reasonable opportunity to review such FDA Submission and NexMed shall
consider and discuss in good faith any comments or proposed changes to such
submission by Warner. NexMed shall be responsible for pursuing, compiling and
submitting all regulatory documents, and for interacting with the FDA. Nexmed
shall be responsible for all product renewal fees payable to the FDA with
respect to any Licensed Product under PDUFA.
 
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3.4. Commercialization.

3.4.1. Responsibility. From and after the Effective Date, Warner, subject to the
terms and conditions of this Agreement, shall be fully responsible for and shall
have full control and authority over the commercialization of Licensed Products
in the Field in the Territory, including without limitation, (a) subject to
Section 4.2.2, all activities relating to manufacture and supply of all Licensed
Products, and (b) all marketing, promotion, sales and distribution activities
relating to any Licensed Product.

3.4.2. Diligence. Warner will exercise Commercially Reasonable Efforts to
commercialize Licensed Products in the Field in the Territory. For the avoidance
of doubt, Warner shall be deemed to have satisfied its obligations under this
Section 3.4.2 so long as it is exercising Commercially Reasonable Efforts to
commercialize the Refrigerated Formulation, the Room Temperature Formulation or
the OTC Product.

3.4.3. Warner Responsibilities. In addition to and without limiting, defining or
otherwise qualifying the standards of conduct set forth elsewhere in this
Agreement, Warner shall:

3.4.3.1. launch the Licensed Product within six (6) months following receipt of
Approval of the Licensed Product in the Territory;

3.4.3.2. perform pre-commercialization analysis, planning, market preparation,
and related marketing activities for the Territory;

3.4.3.3. conduct phase IV clinical trials and marketing studies as Warner deems
necessary or useful for commercialization of Licensed Product;

3.4.3.4. conduct the commercialization of Licensed Product in compliance in all
material respects with all requirements of applicable laws; and

3.4.3.5. consult with and keep NexMed and the JSC informed, through regular,
periodic written reports, in accordance with Section 3.4.5.

3.4.4. Commercialization Expenses. Warner shall be responsible and pay for one
hundred percent (100%) of all costs and expenses incurred in connection with the
distribution, marketing, sale or other commercialization of the Licensed Product
in the Territory.
 
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3.4.5. Updates and Reports. In addition to royalty information reports to be
provided by Warner pursuant to Section 5.5 hereof, no later than sixty (60) days
prior to the expected date of Approval of each Licensed Product,Warner shall
provide NexMed a preliminary written commercialization plan and budget for such
Licensed Product for review and comment by NexMed (each, a “Commercialization
Plan”). Warner shall consider all of NexMed’s comments in good faith. Each
Commercialization Plan shall be developed by Warner in good faith in accordance
with usual pharmaceutical industry practices and, at a minimum, shall contain:
(a) a quarterly Net Sales forecast (dollars and units) and associated pricing
and market share assumptions for at least the four (4) consecutive calendar
quarters after the forecasted First Commercial Sale of such Licensed Product;
(b) the out-of-pocket expense budgets for promotional activities including but
not limited to advertising and public relations and any other relevant
promotional activities; and (c) a description of the sales force efforts,
including the number, type and allocation of pharmaceutical sales
representatives beginning with pre-launch activities through and including the
4th quarter of the Net Sales forecast. Warner shall amend and update each
Commercialization Plan annually after the first such plan is prepared for each
Licensed Product and shall promptly provide a copy of such updated
Commercialization Plan to NexMed. Warner shall provide NexMed with oral updates
as reasonably requested by NexMed with respect to any Commercialization Plan.
All such Commercialization Plans and updates shall be considered Confidential
Information of Warner, subject to the terms of Section 6 hereof.

3.4.6. Pharmacovigilance. Warner shall be responsible for all processing of
information related to any adverse events, including, without limitation, any
information regarding such adverse events that is received from a Third Party
with respect to Licensed Product in the Territory. As soon as reasonably
practicable following the date of this Agreement, the pharmacovigilance
departments of each of NexMed and Warner shall meet and determine the approach
to be taken for the collection, review, assessment, tracking and filing of
information related to adverse events associated with Licensed Product,
consistent with the provisions of this Section 3.4.6. Such approach shall be
documented in a separate and appropriate written pharmacovigilance agreement
between each of NexMed and Warner. Each Party agrees to share relevant
information it receives (either directly or indirectly) with the other Party in
a timely manner so as to allow each Party to comply with its responsibility to
report pharmacovigilance information.
 
4. LICENSED PRODUCT MANUFACTURE AND SUPPLY

4.1. Licensed Product Manufacture by Warner. Subject to Section 4.2, Warner
shall have the sole obligation and responsibility for the manufacture of the
Licensed Products for commercial sale during the Term.

4.2. Option for Licensed Product Manufacture by NexMed. In the event Warner
notifies NexMed that it desires NexMed to manufacture the Refrigerated
Formulation, the Parties shall promptly negotiate in good faith and execute the
necessary manufacturing and supply agreement (the “Manufacturing Agreement”);
provided that it is understood that in the event the parties agree to enter into
the Manufacturing Agreement, Warner shall retain responsibility for the
manufacture and supply of Licensed Product until such time as NexMed is able to
qualify and validate a facility for the manufacture of Licensed Product for the
Territory. The Manufacturing Agreement shall provide that NexMed shall be
exclusively responsible for the manufacture of and supply to Warner, and Warner
shall exclusively purchase from NexMed, all requirements of the Refrigerated
Formulation for a period of three years commencing on the date of Approval of
the Refrigerated Formulation NDA (the “Manufacturing Term”), it being understood
that the Manufacturing Agreement shall also provide that NexMed shall
manufacture quantities of the Refrigerated Formulation necessary to adequately
supply the trade in anticipation of the commercial launch of the Refrigerated
Formulation. Warner shall be responsible for the cost of any initial plant and
equipment improvements with respect to NexMed’s manufacturing facility that are
necessary to enable NexMed to meet its supply obligations under the
Manufacturing Agreement (the “Manufacturing Improvements”), it being understood
that the Manufacturing Improvements shall not include personnel and Warner shall
have no obligation with respect to costs associated with personnel. Warner shall
be responsible for determining the Manufacturing Improvements that are necessary
and a process for conducting such improvements. Warner will oversee the
implementation of the Manufacturing Improvements and NexMed shall reasonably
cooperate to allow such improvements to be completed in a timely manner. The
price for the Refrigerated Formulation supplied to Warner under the
Manufacturing Agreement shall be NexMed’s fully-loaded cost of supply with
respect to such Refrigerated Formulation. The Party manufacturing the
Refrigerated Formulation shall be responsible for payment to the FDA of any
annual fees on establishments under PDUFA with respect to such Party’s
manufacturing facility for so long as such Party manufactures the Refrigerated
Formulation.
 
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4.3. Transfer of Manufacturing Know-How

4.3.1. Upon the reasonable request of Warner, for a period of time from the
Effective Date until twelve (12) months after Approval, NexMed shall provide to
Warner the assistance of NexMed’s employees and access to NexMed’s other
internal resources to provide Warner with a reasonable level of technical
assistance and consultation with respect to the transfer from NexMed to Warner,
or any Third Party manufacturer designated by Warner of the manufacture of the
Refrigerated Formulation. After such initial twelve (12) month period, Warner
shall pay NexMed $600 per day per full time equivalent for the provision of such
assistance.

4.3.2. Upon the reasonable request of Warner, for a period of time from the
Effective Date until twelve (12) months after Approval, NexMed shall provide to
Warner the assistance of NexMed’s employees and access to NexMed’s other
internal resources to provide Warner with a reasonable level of technical
assistance and consultation with respect to the transfer to Warner of any
expertise or know-how that NexMed has developed relating to the manufacture of
Room Temperature Formulation. After such initial twelve (12) month period,
Warner shall pay NexMed $600 per day per full time equivalent for the provision
of such assistance.
 
5. PAYMENTS AND ROYALTIES.
 
5.1. Upfront License Fee. In consideration of the grant of the licenses
described in Section 2 hereof, Warner hereby shall pay NexMed on the Effective
Date a nonrefundable, non-creditable license fee in the amount of Five Hundred
Thousand Dollars ($500,000.00 US).
 
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“**** indicates where a confidential portion has been omitted and filed
separately with the Commission.”
 
5.2. Milestone Payments. Additionally, Warner shall pay to NexMed the following
amounts:

5.2.1. **** Two Million Five Hundred Thousand Dollars ($2,500,000 US). ****

5.2.2. **** Two Million Dollars (US $2,000,000 US). ****

5.2.3. **** Two Million Dollars ($2,000,000 US) ****

5.2.4. **** Six Million Dollars ($6,000,000 US). ****

“**** indicates where a confidential portion has been omitted and filed
separately with the Commission.”

5.3. Royalty Rates; Payment. 

5.3.1. Royalty Payment.  In further consideration of the grant of the licenses
by NexMed hereunder, and subject to the other terms of this Agreement,
commencing on the date of the First Commercial Sale of a Licensed Product and
continuing until the last to expire Valid Claim included in the Licensed Patent
Rights covering such Licensed Product:

5.3.1.1. with respect to Net Sales of Licensed Product during the period from
the date of the First Commercial Sale of the Licensed Product until the end of
the first full calendar year thereafter (“Year 1”), Warner shall pay to NexMed a
royalty payment equal to (i) ****% of the first $150 million of Net Sales, (ii)
****% of Net Sales in excess of $150 million and up to $300 million and (iii)
****% of Net Sales in excess of $300;

5.3.1.2. with respect to Net Sales of Licensed Product during the 12 month
period following Year 1 (“Year 2”), Warner shall pay to NexMed a royalty payment
equal to (i) ****% of the first $150 million of Net Sales, (ii) ****% of Net
Sales in excess of $150 million and up to $300 million and (iii) ****% of Net
Sales in excess of $300 million; and

5.3.1.3. with respect to Net Sales of Licensed Product during the 12 month
period following Year 2 (“Year 3”) and thereafter until the expiration of the
Term, Warner shall pay to NexMed a royalty payment equal to (i) ****% of the
first $150 million of Net Sales, (ii) ****% of Net Sales in excess of $150
million and up to $300 million and (iii) ****% of Net Sales in excess of $300
million.

5.3.2. Generic Competition. The royalties payable by Warner, its Affiliates and
Sublicensees under Section 5.3.1 shall be reduced by fifty percent (50%) for any
period during which one or more Generic Products that have received Approval in
the Field are sold by one or more Third Parties in the Territory during the Term
provided there is a reduction in the market share of the Licensed Product in the
Territory of at least twenty percent (20%), as measured by unit sales (as
determined by IMS International, or if such data is not available, a reliable
source of data as reasonably agreed by the Parties) from the calendar quarter
immediately prior to such first Generic Product sale. Notwithstanding anything
in this Section to the contrary, no adjustment for Generic Product competition
will be due in the event Warner, its Affiliates and Sublicensees fail to use
Commercially Reasonable Efforts to promote and market Licensed Product.
 
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5.4. Payment. All payments to be made by Warner hereunder shall be made in
United States Dollars by wire transfer of immediately available funds to such
United States bank account as shall be designated by NexMed. Late payments shall
bear interest at the rate of 1% of the outstanding balance per month as
prorated, or the maximum amount permitted by law, whichever is less.

5.5. Sales Reports and Royalty Payments. After the First Commercial Sale of a
Licensed Product and during the Term, Warner shall furnish to NexMed a written
report, within thirty (30) days after the end of each calendar quarter (or
portion thereof, if this Agreement terminates during a calendar quarter),
showing the amount of royalty payments due for the immediately preceding
calendar quarter (or portion thereof). Royalty payments for each calendar
quarter shall be due at the same time as such written reports. Each written
report shall contain the following information:

5.5.1. the gross sales and quantity of each Licensed Product sold by Warner, its
Affiliates, and Sublicensees in the preceding calendar quarter;

5.5.2. the calculation of Net Sales from such gross sales; and

5.5.3. the royalties payable in United States Dollars which shall have accrued
hereunder in respect of such Net Sales.

If no royalty payment is due for any royalty period hereunder, Warner shall so
report.

5.6. Tax Withholding; Restrictions on Payment. All payments hereunder shall be
made free and clear of any taxes, duties, levies, fees or charges, except for
withholding taxes (to the extent mandated by applicable law). Warner shall make
any applicable withholding payments due on behalf of NexMed and shall provide
NexMed upon request with such written documentation regarding any such payment
as is available to Warner.

5.7. Sales Record Audit. Warner shall keep, and shall cause each of its
Affiliates, and Sublicensees, if any, to keep, full and accurate books of
accounting in accordance with GAAP as may be reasonably necessary for the
purpose of calculating the royalties payable to NexMed. Such books of accounting
(including, without limitation, those of Warner’s Affiliates, and Sublicensees,
if any) shall be kept at their principal place of business and, with all
necessary supporting data, shall during all reasonable times for the three (3)
years next following the end of the calendar year to which each shall pertain,
be open for inspection at reasonable times upon written notice by NexMed, no
more than once per year, by a nationally recognized independent certified
accountant selected by NexMed (reasonably acceptable to Warner), for the purpose
of verifying royalty statements for compliance with this Agreement. Such
accountant must have agreed in writing to maintain all information learned in
confidence, except as necessary to disclose to NexMed such compliance or
noncompliance by Warner. The results of each inspection, if any, shall be
binding on both Parties. NexMed shall pay for such inspections, except that in
the event there is any upward adjustment in aggregate royalties payable for the
period of such inspection of more than five percent (5%) of the amount actually
paid to NexMed, Warner shall pay for the reasonable out-of-pocket costs of such
audit. Any underpayments shall be paid by Warner within thirty (30) days of
notification of the results of such inspection plus interest as calculated in
accordance with Section 5.4. Any overpayments shall be fully creditable against
amounts payable in subsequent payment periods or, if no such amounts become
payable within ninety (90) days after notification of such results, shall be
refunded.
 
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5.8. Minimum Royalties. If at any time after the completion of Year 3 Warner
fails to generate at least $25 million of Net Sales in each of two consecutive
Contract Years (the “Net Sales Minimums”), upon the written request of NexMed,
the Parties shall enter into a co-promotion agreement on commercially reasonable
terms with respect to the Licensed Products pursuant to which NexMed will have
the right to co-promote the Licensed Products. Notwithstanding the foregoing, if
Warner, in its sole discretion, makes a payment to NexMed within thirty (30)
days of receipt of such request equal to difference between (i) the amount of
the royalty that NexMed would have received under Section 5.3.1.3 if Warner had
generated $25 million of Net Sales in each of such two consecutive Contract
Years and (ii) the amount of the royalty actually paid to NexMed with respect to
such periods, then NexMed shall have no co-promotion rights hereunder as a
result of Warner’s failure to meet such Net Sales Minimums.

 
6. TREATMENT OF CONFIDENTIAL INFORMATION
 
6.1. Confidentiality Obligations. Each of NexMed and Warner agree that during
the Term and for ten (10) years thereafter, it will keep confidential, and will
cause its employees, consultants, Affiliates, agents, subcontractors, and
Sublicensees to keep confidential, all Confidential Information of the other
Party. Neither NexMed nor Warner nor any of their employees, consultants,
Affiliates, agents, subcontractors, or Sublicensees shall use Confidential
Information of the other Party for any purpose whatsoever other than exercising
any rights granted to it or reserved by it hereunder. Without limiting the
foregoing, each Party may disclose information to the extent such disclosure is
reasonably necessary to (a) file and prosecute patent applications and/or
maintain patents which are filed or prosecuted in accordance with the provisions
of this Agreement, or (b) file, prosecute or defend litigation in accordance
with the provisions of this Agreement or (c) comply with applicable laws,
regulations or court orders; provided, however, that if a Party is required to
make any such disclosure of the other Party’s Confidential Information in
connection with any of the foregoing, it will give reasonable advance notice to
the other Party of such disclosure requirement and will use reasonable efforts
to assist such other Party in efforts to secure confidential treatment of such
information required to be disclosed.

6.2. Limited Disclosure and Use. NexMed and Warner each agree that any
disclosure of the other Party’s Confidential Information to any of its
employees, consultants, Affiliates, agents, subcontractors, or sublicensees
shall be made only if and to the extent necessary to carry out its rights and
responsibilities under this Agreement, shall be limited to the maximum extent
possible consistent with such rights and responsibilities, and shall only be
made to the extent any such persons are bound by confidentiality obligations to
maintain the confidentiality thereof and not to use such Confidential
Information except as expressly permitted by this Agreement. NexMed and Warner
each further agree not to disclose or transfer the other Party’s Confidential
Information to any Third Parties under any circumstance without the prior
written approval from the other Party, except as otherwise required by law, and
except as otherwise expressly permitted by this Agreement. Each Party shall take
such action, and shall cause its employees, consultants, Affiliates, agents,
subcontractors, and sublicensees to take such action, to preserve the
confidentiality of each other Party’s Confidential Information as it would
customarily take to preserve the confidentiality of its own Confidential
Information. In connection with the termination of this Agreement, upon the
request of the other Party, each Party will return all the Confidential
Information disclosed or transferred to it by the other Party pursuant to this
Agreement, including all copies and extracts of documents and all manifestations
of Confidential Information in any form, within sixty (60) days of such request;
provided however, that a Party may retain (a) any Confidential Information of
the other Party relating to any license which expressly survives such
termination and (b) one (1) copy of all other Confidential Information in
inactive archives solely for the purpose of maintaining a record of information
and materials deemed to be Confidential Information hereunder.
 
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6.3. Publicity. Neither Party may publicly disclose the existence or terms or
any other matter of fact regarding this Agreement without the prior written
consent of the other Party; provided, however, that either Party may make such a
disclosure (a) to the extent required by law or by the requirements of any
nationally recognized securities exchange, quotation system or over-the-counter
market on which such Party has its securities listed or traded, or (b) to any
actual or prospective sublicensees, investors, lenders, other financing sources,
acquirors, or companies being acquired by such Party who are obligated to keep
such information confidential. The Party desiring to make any such public
announcement or disclosure shall inform the other Party of the proposed
announcement or disclosure in reasonably sufficient time prior to public release
and shall provide the other Party with a written copy thereof. Each Party agrees
that it shall cooperate fully with the other with respect to all disclosures
regarding this Agreement to the Securities Exchange Commission and any other
governmental or regulatory agencies, including, without limitation, requests for
confidential treatment of proprietary information of either Party included in
such disclosure.
 
7. PROVISIONS CONCERNING THE FILING, PROSECUTION AND  MAINTENANCE OF LICENSED
PATENT RIGHTS
 
7.1. Ownership of Inventions.

7.1.1. Sole Inventions. Subject to Section 7.1.3, each Party shall exclusively
own all inventions conceived by such Party, its employees, agents and
consultants during the Term without the use in any material respect of any
Technology owned by the other Party (“Sole Inventions”). Sole Inventions
conceived solely by NexMed, its employees, agents and consultants are referred
to herein as “NexMed Sole Inventions”. Sole Inventions conceived solely by
Warner, its employees, agents and consultants are referred to herein as “Warner
Sole Inventions.”

7.1.2. Joint Inventions. Subject to Section 7.1.3, the Parties shall jointly own
all inventions (a) conceived or first reduced to practice jointly by or on
behalf of both Warner (or any of its Affiliates) and NexMed (or any of its
Affiliates) or (b) conceived or first reduced to practice by or on behalf of one
Party or any of its Affiliates as a result of its use in any material respect of
the Technology of the other Party, on the basis of each Party having an
undivided interest in the whole (collectively “Joint Inventions”).
 
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7.1.3. Permeation Inventions. Notwithstanding Section 7.1.1 or Section 7.2.2, in
the event a Joint Invention is a discovery, invention, improvement or new use of
permeation enhancing excipient technology (a “Permeation Invention”), such
Permeation Invention shall be the sole and exclusive property of NexMed, and
Warner agrees to assign, and hereby does assign, its entire right, title and
interest in and to such Permeation Invention to NexMed. Thereafter, all assigned
Permeation Inventions shall be part of the “Licensed Know-How” under this
Agreement.

7.1.4. Inventorship. For purposes of determining whether an invention is a
NexMed Sole Invention, a Warner Sole Invention or a Joint Invention, questions
of inventorship shall be resolved in accordance with United States patent laws.

7.2. Cooperation. Warner agrees to cooperate with all reasonable requests of
NexMed in the filing and prosecution of the Licensed Patent Rights.
 
7.3. Patent Filing, Prosecution and Maintenance. Subject to the other terms of
this Section 7, NexMed, at its cost, shall use Commercially Reasonable Efforts
to diligently prepare, file, prosecute, and maintain, the Licensed Patent Rights
in the Territory. NexMed shall timely provide to Warner, prior to filing, any
patent applications or filings with respect to the Licensed Patent Rights in the
Territory and shall consider in good faith any comments by Warner thereon.
NexMed will keep Warner informed of the status of filing, prosecution and
maintenance of all Licensed Patent Rights in the Territory and shall provide
Warner with copies of all material documents relating thereto. NexMed also shall
promptly notify Warner in the event it determines to abandon or permit the
expiration of any Patent Rights included in the Licensed Patent Rights in the
Territory (other than any expiration of the natural life of such Patent
Right(s)), which notice shall, to the extent practical, be delivered no less
than thirty (30) days prior to such action or inaction, in order to permit
Warner, in Warner’s reasonable judgment and at Warner’s cost and expense, to
prosecute or maintain such Licensed Patent Right(s), provided, however, that any
such action does not violate the terms of any judgment, settlement, compromise
or other resolution binding upon NexMed.
 
7.4. Notice of Infringement. If, during the Term, either Party learns of any
actual, alleged or threatened infringement by a Third Party of any Licensed
Patent Rights in the Territory, such Party shall notify the other Party within
fifteen (15) days of becoming aware of such infringement and shall provide such
other Party with available evidence of such infringement.
 
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7.5. Infringement of Licensed Patent Rights. NexMed shall have the first right
(but not the obligation), at its own expense and with legal counsel of its own
choice, to bring suit (or take other appropriate legal action) against any
actual, alleged or threatened infringement of the Divided Patent Rights in the
Territory. Warner shall have the first right (but not the obligation), at its
own expense and with legal counsel of its own choice, to bring suit (or take
other appropriate legal action) against any actual, alleged or threatened
infringement of the Undivided Patent Rights in the Territory. Each Party shall
have the right, at its own expense, to be represented in any such action brought
by the other by counsel of such Party’s own choice; provided, however, that
under no circumstances shall the foregoing affect the right of the other Party
to control the suit as described in this Section 7.5. Notwithstanding the
foregoing, neither Party shall settle, compromise or otherwise resolve any such
suit that (i) in the case of a settlement by NexMed, materially restricts or
waives rights under the Licensed Patent Rights granted to Warner hereunder and
(ii) in the case of a settlement by Warner, materially restricts or waives any
rights under the Licensed Patents, in each case without the prior written
consent of the other Party, which consent shall not be unreasonably withheld,
conditioned or delayed. If the Party having the first right to bring suit does
not file any action or proceeding against any such infringement within thirty
days after the earliest of notice under Section 7.4, or a written request from
the other to take action with respect to such infringement, then other Party
shall have the right (but not the obligation), at its own expense, to bring suit
(or take other appropriate legal action) against such actual, alleged or
threatened infringement, with legal counsel of its own choice, but shall not be
permitted to settle, compromise or otherwise resolve any such suit without the
prior written consent of the other Party, which consent shall not be
unreasonably withheld, conditioned or delayed. Any damages, monetary awards or
other amounts recovered by a Party, whether by judgment or settlement, pursuant
to any suit, proceeding or other legal action taken under this Section 7.5,
shall be applied as follows:

7.5.1. first, to reimburse the Parties for their respective out-of- pocket costs
and expenses (including reasonable attorneys’ fees and costs) incurred in
prosecuting such enforcement action; and

7.5.2. second, any remaining balance that (i) represents compensation for lost
sales, royalty or profits, or any other damages as result of impairment of
Warner’s rights hereunder resulting from the infringement (collectively,
“Infringement Damages”), shall be retained by or paid to Warner; provided, such
Infringement Damages shall be deemed Net Sales and subject to royalty payments
as set forth in Section 5.3.1 and (ii) represents punitive and exemplary damages
shall be shared equally by Warner and NexMed.
 
If a Party brings any such action or proceeding hereunder, the other Party
agrees to be joined as Party plaintiff if necessary to prosecute such action or
proceeding, and to give the Party bringing such action or proceeding reasonable
assistance and authority to file and prosecute the suit; provided, however, that
neither Party shall be required to transfer any right, title or interest in or
to any property to the other Party or any Third Party to confer standing on a
Party hereunder.
 
7.6. Defense of Claims. In the event that any action, suit or proceeding is
brought against NexMed or Warner or any Affiliate or Sublicensee of either Party
alleging the infringement of the Technology or intellectual property rights of a
Third Party by reason of the development, manufacture, use, sale, importation or
offer for sale of a Licensed Product in the Territory (a “Third Party Action”)
then Warner shall have the first right to defend itself and NexMed in such Third
Party Action. In such case, NexMed shall have the right to be represented by
independent counsel at NexMed’s own expense. If either Warner refuses to accept
control of the defense of a Claim by a Third Party for which it has the first
right to control defense hereunder within thirty (30) days after receiving or
giving notice thereof, then the other NexMed shall have the right to defend
against such Third Party Action. The Parties and their respective Affiliates
shall cooperate with each other in the defense of any Third Party Action. The
Parties will give each other prompt written notice of the commencement of any
Third Party Action and will furnish each other a copy of each communication
relating to the alleged infringement. Warner shall not compromise, settle or
otherwise dispose of any Third Party Action without NexMed’s advice and prior
consent if such compromise, settlement or other disposition would impair the use
of such Technology or Patent Rights, provided that such consent shall not be
unreasonably withheld. The Parties shall each be responsible for fifty percent
(50%) of the amount of any settlement, judgment or legal expenses arising out of
such Third Party Action.
 
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8. REPRESENTATIONS AND WARRANTIES
 
8.1. NexMed Representations. NexMed represents and warrants to Warner that: 

8.1.1. the execution and delivery of this Agreement and the performance of the
transactions contemplated hereby have been duly authorized by all appropriate
NexMed corporate action;

8.1.2. this Agreement is a legal and valid obligation binding upon NexMed and
enforceable in accordance with its terms, and the execution, delivery and
performance of this Agreement by NexMed does not conflict with any agreement,
instrument or understanding to which NexMed is a Party or by which it is bound;

8.1.3. To the knowledge of NexMed, NexMed has not provided to Warner any written
information concerning the Licensed Know-How which is materially inaccurate or
misleading and has not failed to provide to Warner any written information in
its possession or under its Control which is materially inconsistent with the
written information provided to Warner by NexMed as of the Effective Date;

8.1.4. NexMed is the owner of the Licensed Patent Rights and Licensed Know-How
and has the requisite rights to grant to Warner the licenses granted herein to
Warner, and, to the knowledge of NexMed, no right or license of any Third Party
is required to permit NexMed to perform its obligations under this Agreement in
accordance with the terms of this Agreement;

8.1.5. to the knowledge of NexMed no Third Party patent, patent application or
other intellectual property rights would be infringed by practicing any process
or method or by making, using or selling any composition which is claimed or
disclosed in the Licensed Patent Rights, or which constitutes Licensed Know-How;

8.1.6. there is no litigation pending or, to the knowledge of NexMed,
threatened, against NexMed with respect to the Licensed Patent Rights existing
as of the Effective Date; and

8.1.7. NexMed is not aware of any infringement or misappropriation by a Third
Party of the Licensed Patent Rights or Licensed Know-How.
 
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8.2. Warner Representations. Warner represents and warrants to NexMed that: 

8.2.1. the execution and delivery of this Agreement and the performance of the
transactions contemplated hereby have been duly authorized by all appropriate
Warner corporate action; and

8.2.2. this Agreement is a legal and valid obligation binding upon Warner and
enforceable in accordance with its terms, and the execution, delivery and
performance of this Agreement by Warner does not conflict with any agreement,
instrument or understanding to which Warner is a Party of or by which it is
bound.
 
8.3. No Warranties. Except as expressly set forth in this Agreement, NEITHER
PARTY MAKES ANY REPRESENTATION OR EXTENDS ANY WARRANTIES OF ANY KIND, WHETHER
EXPRESS OR IMPLIED, WRITTEN OR ORAL, AND EXCEPT AS EXPRESSLY SET FORTH IN THIS
AGREEMENT, ALL SUCH WARRANTIES ARE HEREBY DISCLAIMED, INCLUDING, WITHOUT
LIMITATION, WARRANTIES ARISING BY COURSE OF DEALING, PERFORMANCE, CUSTOM OR
USAGE IN THE TRADE, AND IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A
PARTICULAR PURPOSE.

8.4. Indemnification.

8.4.1. Warner Indemnity. Warner shall indemnify, defend and hold harmless
NexMed, its Affiliates and their respective directors, officers, employees,
stockholders and agents and their respective successors, heirs and assigns (the
“NexMed Indemnitees”) from and against any liability, damage, loss or expense
(including reasonable attorneys’ fees and expenses of litigation) incurred by or
imposed upon such NexMed Indemnitees, or any of them, in connection with any
Third Party claims, suits, actions, demands or judgments, including, without
limitation, product liability matters, to the extent arising (i) as a
consequence of a breach by Warner of its representations, warranties, covenants
or agreements, hereunder or (ii) out of the manufacture, sale or use by any
person of any Licensed Product manufactured or sold by Warner or any Affiliate
or Sublicensee under this Agreement, in each case, except to the extent of
NexMed’s responsibility therefore under Section 8.4.2, or arising from the
negligence or willful misconduct of NexMed.

8.4.2. NexMed Indemnity. NexMed shall indemnify, defend and hold harmless
Warner, its Affiliates and their respective directors, officers, employees, and
agents, and their respective successors, heirs and assigns (the “Warner
Indemnitees”), from and against any liability, damage, loss or expense
(including reasonable attorneys’ fees and expenses of litigation) incurred by or
imposed upon such Warner Indemnitees, or any of them, in connection with any
Third Party claims, suits, actions, demands or judgments, arising as a result of
(i) a breach by NexMed of its representations, warranties, covenants or
agreements hereunder, in each case, except to the extent of Warner’s
responsibility therefore under Section 8.4.1, or arising from the negligence or
willful misconduct of Warner or (ii) the manufacture by NexMed of any Licensed
Product.
 
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8.4.3. Indemnification Procedures. In the event that any Indemnitee is seeking
indemnification under Section 8.4 above from a Party (the “Indemnifying Party”),
the other Party shall notify the Indemnifying Party of such claim with respect
to such Indemnitee as soon as reasonably practicable after the Indemnitee
receives notice of the claim, and the Party (on behalf of itself and such
Indemnitee) shall permit the Indemnifying Party to assume direction and control
of the defense of the claim (including the right to settle the claim solely for
monetary consideration) and shall cooperate as requested (at the expense of the
Indemnifying Party) in the defense of the claim. The indemnification obligations
under Section 8 shall not apply to any harm suffered as a direct result of any
delay in notice to the Indemnifying Party hereunder or to amounts paid in
settlement of any claim, demand, action or other proceeding if such settlement
is effected without the consent of the Indemnifying Party, which consent shall
not be withheld or delayed unreasonably. The Indemnitee, its employees and
agents, shall reasonably cooperate with the Indemnifying Party and its legal
representatives in the investigation of any claim, demand, action or other
proceeding covered by Section 8.4.
 
8.5. LIMITATION OF LIABILITY.

8.5.1. EXCEPT FOR EACH PARTY’S OBLIGATION OF INDEMNITY UNDER SECTION 8.4,
NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR ANY LOST PROFITS OR FOR ANY
INDIRECT, EXEMPLARY, SPECIAL, CONSEQUENTIAL OR INCIDENTAL DAMAGES OF ANY KIND,
EVEN IF IT HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, EXCEPT FOR A
BREACH OF EITHER PARTY’S OBLIGATIONS WITH RESPECT TO SECTION 6 (“TREATMENT OF
CONFIDENTIAL INFORMATION”).

8.5.2. THE LIMITATIONS OF LIABILITY CONTAINED IN THIS AGREEMENT ARE A
FUNDAMENTAL PART OF THE BASIS OF EACH PARTY’S BARGAIN HEREUNDER, AND NEITHER
PARTY WOULD ENTER INTO THIS AGREEMENT ABSENT SUCH LIMITATION OF LIABILITY.

8.6. Insurance. Each Party will obtain and maintain, during the term of this
Agreement, at its own cost and expense, with reputable and financially sound
insurance carriers, comprehensive commercial general liability insurance,
product liability insurance, to cover such Party’s indemnification obligations
hereunder, or self-insurance, in amounts consistent with such Party’s normal
business practices. Each Party will name the other Party as an additional
insured on each such insurance policy. Each such policy or self-insurance shall
be in types and amount that are reasonable and customary in the pharmaceutical
industry for companies engaged in similar business and operations and amounts
that meet all contractual requirements of each Party’s vendors, distributors or
other contractors. Maintenance of such insurance coverage will not relieve a
Party of any responsibility under this Agreement for Losses in excess of such
insurance limits or otherwise. Each Party will provide the other Party, upon
reasonable request, with a certificate from the insurer(s) evidencing such
insurance coverage.
 
9. TERM AND TERMINATION
 
9.1. Term; Expiration. Unless earlier terminated as provided herein, the term of
this Agreement (“Term”) shall commence on the Effective Date and continue until
expiration of the last to expire of the Licensed Patent Rights. Upon the
expiration of the last payment obligation to NexMed hereunder (other than a
termination for cause), Warner shall have a fully paid-up, irrevocable and
sublicensable (subject to the terms of Section 2.2) license in the Territory and
the Field under the Licensed Know-How to make, have made, use, have used, sell,
distribute for sale, have distributed for sale, offer for sale, have sold,
import or have imported Licensed Products in the Territory.
 
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9.2. Termination by NexMed.

9.2.1. Insolvency. NexMed shall have the right to terminate this Agreement with
respect to any or all licenses granted to Warner pursuant to Section 2 of this
Agreement, at NexMed’ sole discretion, upon delivery of written notice to Warner
upon the filing by Warner in any court or agency pursuant to any statute or
regulation of the United States or any other jurisdiction of a petition in
bankruptcy or insolvency or for reorganization or similar arrangement for the
benefit of creditors or for the appointment of a receiver or trustee of Warner
or its assets, or if Warner is served with an involuntary petition against it in
any insolvency proceeding, upon the ninety-first (91st) day after such service
if such involuntary petition has not previously been stayed or dismissed, or
upon the making by Warner of an assignment of substantially all of its assets
for the benefit of its creditors.

9.2.2. Material Breach. NexMed shall have the right to terminate this Agreement
with respect to any or all licenses granted to Warner pursuant to Section 2 of
this Agreement by giving thirty (30) days written notice to Warner in the event
of any breach by Warner of any material terms and conditions of this Agreement,
provided that such breach has not been cured within sixty (60) days after
written notice thereof is given by NexMed to Warner specifying the nature of the
alleged breach.

9.2.3. Termination for Convenience. NexMed may terminate this Agreement upon
delivery of written notice to Warner if Warner (i) has not delivered the Room
Temperature Formulation Development Notice and (ii)(A) the 45 day period set
forth in Section 5.2.1 has expired and Warner has not made a payment to NexMed
thereunder or (B) the 30 day period set forth in Section 5.2.2 has expired and
Warner has not made a payment to NexMed thereunder.

9.2.4. Patent Challenge. NexMed will be permitted to terminate this Agreement by
written notice effective upon receipt if Warner or its Affiliates directly, or
indirectly through assistance granted to a Third Party, commence any
interference or opposition proceeding, challenge the validity or enforceability
of (other than in defense of an action for infringement of a Patent Controlled
by Warner), or oppose any extension of or the grant of a supplementary
protection certificate with respect to, any Licensed Patent Right (each such
action, a “Patent Challenge”). Warner will include provisions in all agreements
granting sublicenses of Warner’s rights hereunder providing that if the
Sublicensee or its Affiliates undertake a Patent Challenge with respect to any
NexMed Patent under which the sublicensee is sublicensed, Warner will be
permitted to terminate such sublicense agreement. If a sublicensee of Warner (or
an Affiliate of such sublicensee) undertakes a Patent Challenge of any such
Licensed Patent Right under which such Sublicensee is sublicensed, then Warner
upon receipt of notice from NexMed of such Patent Challenge will terminate the
applicable sublicense agreement. If Warner fails to so terminate such sublicense
agreement, NexMed may terminate Warner’s right to sublicense and any sublicenses
previously granted to such sublicensee shall automatically terminate. In
connection with such sublicense termination, Warner shall cooperate with
NexMed’s reasonable requests to cause such a terminated sublicensee to
discontinue activities with respect to the Licensed Product.
 
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9.3. Termination by Warner.

9.3.1. Insolvency. Warner shall have the right to terminate this Agreement at
Warner’s sole discretion, upon delivery of written notice to NexMed upon the
filing by NexMed in any court or agency pursuant to any statute or regulation of
the United States or any other jurisdiction of a petition in bankruptcy or
insolvency or for reorganization or similar arrangement for the benefit of
creditors or for the appointment of a receiver or trustee of NexMed or its
assets, or if NexMed is served with an involuntary petition against it in any
insolvency proceeding, upon the ninety-first (91st) day after such service if
such involuntary petition has not previously been stayed or dismissed, or upon
the making by NexMed of an assignment of substantially all of its assets for the
benefit of its creditors.

9.3.2. Material Breach. In addition, Warner may terminate this Agreement by
giving thirty (30) days written notice to NexMed in the event of any breach by
NexMed of any material terms and conditions of this Agreement, provided that
such breach has not been cured within sixty days (60) days after written notice
thereof is given by Warner to NexMed specifying the nature of the alleged
breach.

9.3.3. Termination for Convenience. Warner may terminate this Agreement upon
delivery of written notice to NexMed following:

9.3.3.1.  receipt of (i) Ninety Day Conference Comments sufficient to commence
the 45 day period under Section 5.2.1 hereof or (ii) all material FDA comments
provided to NexMed in connection with the process of obtaining Approval of the
Refrigerated Formulation NDA if such Ninety Day Comments are not received;
provided Warner delivers such notice within forty five (45) days of receipt of
such comments;

9.3.3.2.  receipt of Approval of the Refrigerated Formulation NDA, if such NDA,
as approved, (i) contains labeling that is not materially consistent with the
labeling set forth in Exhibit A or (ii) in Warner’s reasonable determination,
will not allow it to launch a commercially viable Licensed Product; provided
Warner delivers such notice within thirty (30) days of receipt of such Approval;
or

9.3.3.3.  receipt of Approval of the Room Temperature Formulation Supplement, if
such NDA, as approved, contains labeling that is not materially consistent with
the labeling agreed by the Parties in accordance with Section 3.2.3.2; provided
Warner delivers such notice within thirty (30) days of receipt of such Approval.

For the avoidance of doubt, if Warner exercises its termination right under this
Section 9.3.3 it shall have no obligation to make any milestone payment with
respect to the milestone event resulting in such termination.

9.4. Effect of Termination. Upon termination of this Agreement or any right or
license pursuant to Sections 9.2 or 9.3, the rights and obligations of the
Parties hereunder, and all licenses granted to Warner hereunder shall
immediately cease.
 
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9.4.1. Payments. Subject to Section 9.3.3, all amounts due or payable to NexMed
prior to the effective date of termination shall remain due and payable, but
(except as otherwise expressly provided herein) no additional amounts shall be
payable.

9.4.2. Inventory. Should Warner have any inventory of any Licensed Product
approved and allocated for commercial sale prior to termination other than upon
the occurrence of a material breach by NexMed pursuant to Section 9.3.2, Warner
shall have twelve (12) months thereafter in which to dispose of such inventory
(subject to the payment to NexMed of any royalties due hereunder thereon). In
the event that, at the end of such twelve-month period, Warner has unsold
inventory of Licensed Product remaining, Warner shall offer to sell such
Licensed Products to NexMed at Warner's fully loaded manufacturing cost (but
NexMed shall be under no obligation to purchase same unless it agrees to do so
in writing at such time). If NexMed terminates this Agreement pursuant to
Section 9.2.1 or 9.2.2, Warner and its Affiliates and Sublicensees shall
immediately cease all sales of Licensed Product.

9.4.3. Assignments. Warner will promptly (and in each case within sixty (60)
days of receipt of NexMed’s request) and at no cost to NexMed:

9.4.3.1. following any termination of this Agreement other than a termination
under Section 9.3.1 or 9.3.2:

9.4.3.1.1. upon NexMed’s request, assign to NexMed all of Warner’s right, title
and interest in and to any agreements between Warner and Third Parties that are
freely assignable by Warner and that relate to the commercialization of Licensed
Product;

9.4.3.1.2. Warner, if in Warner’s name or possession, agrees to transfer and
assign, and hereby does transfer and assign, to NexMed all of Warner’s right,
title and interest in and to any and all regulatory filings, regulatory dossiers
and Approvals (including the NDA and any foreign equivalents thereto) for
Licensed Product;

9.4.3.1.3. assign to NexMed all of Warner’s right, title and interest in and to
any trademarks utilized by Warner in connection with the commercialization of
Licensed Product (other than any Warner housemarks or logos) (including any
goodwill associated therewith), any registrations and design patents for any of
the foregoing and any Internet domain name registrations for such trademarks and
slogans, all to the extent solely related to Licensed Product;

9.4.3.1.4. to the extent that any agreement or other asset described in this
Section 9.4.3 is not assignable by Warner or does not relate solely to Licensed
Product, then such agreement or other asset will not be assigned, and upon the
request of NexMed, Warner will take such steps as may be necessary to allow
NexMed to obtain and to enjoy the benefits of such agreement or other asset in
the form of a license or other right to the extent Warner has the right and
ability to do so; and

9.4.3.1.5. provide copies of any other books, records, documents and instruments
to the extent related to Licensed Product.
 
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9.4.3.2.  following any termination of this Agreement under Section 9.3.1 or
9.3.2, Warner (i) if in Warner’s name or possession, agrees to transfer and
assign, and hereby does transfer and assign, to NexMed all of Warner’s right,
title and interest in and to any and all regulatory filings, regulatory dossiers
and Approvals (including the NDA and any foreign equivalents thereto) for
Licensed Product and (ii) will promptly assign to NexMed all of Warner’s right,
title and interest in and to any trademarks utilized by Warner in connection
with the commercialization of Licensed Product (other than any Warner housemarks
or logos) (including any goodwill associated therewith), any registrations and
design patents for any of the foregoing and any Internet domain name
registrations for such trademarks and slogans, all to the extent solely related
to Licensed Product.

9.4.4. Manufacturing. To the extent Warner is then manufacturing Licensed
Product, Warner will, upon NexMed’s request, supply NexMed with quantities of
Licensed Product for the shorter of (i) the period until NexMed or its designee
is able to resume manufacturing Licensed Product or (ii) twelve (12) months from
the effective date of such termination; provided, however, that NexMed will
reimburse Warner for Warner’s cost of goods, it being understood that in the
case of a termination under Section 9.3.1 or 9.3.2 Warner shall have no
obligation to supply NexMed with Licensed Product.

9.4.5. Sublicensees. Except for a termination for cause by NexMed arising as a
result of a breach by a Sublicensee of the terms, conditions and limitations set
forth herein, upon any termination of this Agreement where Warner has designated
a non-Affiliate as a Sublicensee as permitted hereunder, such Sublicensee shall
be permitted to exercise the rights granted under such Sublicense on the same
terms and conditions under which such rights and licenses were granted to such
Sublicensee, provided that such Sublicensee (i) is in material compliance with
the Sublicense terms; (ii) agrees in writing to be bound by the terms,
conditions and limitations relating to the Licensed Patent Rights, Licensed
Know-How, Licensed Compounds and Confidential Information as set forth
hereunder; and (iii) agrees, to further evidence the continuation of the
licenses granted under this Agreement and the Sublicense, execute a document
having the same text and meaning as the Sublicense in favor of NexMed but does
not include obligations upon NexMed that exceed the obligations of NexMed under
this Agreement.
 
9.5. Remedies. Except as otherwise expressly set forth in this Agreement, the
termination provisions of this Section 9 are in addition to any other relief and
remedies available to either Party at law.
 
9.6. Surviving Provisions. Notwithstanding any provision herein to the contrary,
the rights and obligations of the Parties set forth in Sections 5.5, 5.6, 5.7,
8.4, 8.5, 9.4, 11.3 and Articles 1 and 6, as well as any rights or obligations
otherwise accrued hereunder (including any accrued payment obligations), shall
survive the expiration or termination of the Term for any reason. Without
limiting the generality of the foregoing and subject to Section 9.3.3, Warner
shall have no obligation to make any milestone or royalty payment to NexMed that
has not accrued prior to the effective date of any termination of this
Agreement, but shall remain liable for all such payment obligations accruing
prior to the effective date of such termination.
 
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10. Jurisdiction. The Parties agree that any suit, action or proceeding seeking
to enforce any provision of, or based on any matter arising out of or in
connection with, this Agreement or the transactions contemplated hereby shall be
brought in the United States District Court for the District of New Jersey or
any New Jersey State court, so long as one of such courts shall have subject
matter jurisdiction over such suit, action or proceeding, and that any cause of
action arising out of this Agreement shall be deemed to have arisen from a
transaction of business in the State of New Jersey, and each of the parties
hereby irrevocably consents to the jurisdiction of such courts (and of the
appropriate appellate courts therefrom) in any such suit, action or proceeding
and irrevocably waives, to the fullest extent permitted by law, any objection
that it may now or hereafter have to the laying of the venue of any such suit,
action or proceeding in any such court or that any such suit, action or
proceeding brought in any such court has been brought in an inconvenient forum.
Process in any such suit, action or proceeding may be served on any party
anywhere in the world, whether within or without the jurisdiction of any such
court. 
 
11. MISCELLANEOUS
 
11.1. Notification. All notices, requests and other communications hereunder
shall be in writing, shall be addressed to the receiving Party’s address set
forth below or to such other address as a Party may designate by notice
hereunder, and shall be either (i) delivered by hand, (ii) made by facsimile
transmission (to be followed with written confirmation by the delivering Party),
(iii) sent by private courier service providing evidence of receipt, or (iv)
sent by registered or certified mail, return receipt requested, postage prepaid.
The addresses and other contact information for the Parties are as follows:

If to NexMed:
NexMed, Inc.
89 Twin Rivers Drive
East Windsor, NJ 08520
Attn: Chief Financial Officer
Fax: (609) 426-9116
   
With a copy to:
Morgan, Lewis & Bockius LLP
502 Carnegie Center
Princeton, New Jersey 08540
Attn: Steven M. Cohen
Fax: (609) 919-6701
   
If to Warner:
Warner Chilcott Company, Inc. 
PO Box 1005 
Fajardo, Puerto Rico 00738   
Attn: Director, Business Management  
Fax: (787) 863 5355
   
With a copy to:
Warner Chilcott (US), Inc.
100 Enterprise Drive
Rockaway, New Jersey 07866
Attn: General Counsel
Fax: (973) 442-3310
 

 
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All notices, requests and other communications hereunder shall be deemed to have
been given either (i) if by hand, at the time of the delivery thereof to the
receiving Party at the address of such Party set forth above, (ii) if made by
facsimile transmission, at the time that receipt thereof has been acknowledged
by the recipient, (iii) if sent by private courier, on the day such notice is
delivered to the recipient, or (iv) if sent by registered or certified mail, on
the fifth (5th) business day following the day such mailing is made.
 
11.2. Language. This Agreement has been prepared in the English language and the
English language shall control its interpretation.
 
11.3. Governing Law. This Agreement will be construed, interpreted and applied
in accordance with the laws of the State of New Jersey, excluding its body of
law controlling conflicts of law.
 
11.4. Entire Agreement. This Agreement is the entire Agreement between the
Parties with respect to the subject matter hereof and supersedes all prior
representations, understandings and agreements between the Parties with respect
to the subject matter hereof. No modification shall be effective unless in
writing with specific reference to this Agreement and signed by the Parties.
 
11.5. Waiver. The terms or conditions of this Agreement may be waived only by a
written instrument executed by the Party waiving compliance. The failure of
either Party at any time or times to require performance of any provision hereof
shall in no manner affect its rights at a later time to enforce the same. No
waiver by either Party of any condition or term shall be deemed as a continuing
waiver of such condition or term or of another condition or term.
 
11.6. Headings. Section and subsection headings are inserted for convenience of
reference only and do not form part of this Agreement.
 
11.7. Assignment. This Agreement shall not be assignable by either Party to any
third party without the written consent of the other Party hereto; except either
party may assign this Agreement, without such consent, to (i) an Affiliate or
(ii) an entity that acquires all or substantially all of the capital stock,
business or assets of the Party to which this Agreement pertains, (whether by
merger, reorganization, acquisition, sale or otherwise) and agrees in writing to
be bound by the terms and conditions of this Agreement. Any permitted assignee
shall assume all obligations of its assignor under this Agreement. Any purported
assignment in violation of this Section 11.7 shall be void. The terms and
conditions of this Agreement shall be binding upon and inure to the benefit of
the permitted successors and assigns of the Parties. 
 
11.8. Force Majeure. Except for obligations of payment arising hereunder,
neither Party shall be liable for failure of or delay in performing obligations
set forth in this Agreement, and neither shall be deemed in breach of its
obligations, if such failure or delay is due to natural disasters or any causes
beyond the reasonable control of such Party. In event of such force majeure, the
Party affected thereby shall use commercially reasonable efforts to cure or
overcome the same and resume performance of its obligations hereunder.
 
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11.9. Construction. The Parties hereto acknowledge and agree that: (i) each
Party and its counsel reviewed and negotiated the terms and provisions of this
Agreement and have contributed to its revision; (ii) the rule of construction to
the effect that any ambiguities are resolved against the drafting Party shall
not be employed in the interpretation of this Agreement; and (iii) the terms and
provisions of this Agreement shall be construed fairly as to all Parties hereto
and not in favor of or against any Party, regardless of which Party was
generally responsible for the preparation of this Agreement. Neither Party shall
challenge the validity or enforceability of the terms, conditions, obligations
and covenants hereunder.
 
11.10. Severability. If any provision(s) of this Agreement are or become
invalid, are ruled illegal by any court of competent jurisdiction or are deemed
unenforceable under then current applicable law from time to time in effect
during the Term hereof, it is the intention of the Parties that the remainder of
this Agreement shall not be affected thereby provided that a Party’s rights
under this Agreement are not materially affected. The Parties hereto covenant
and agree to renegotiate any such term, covenant or application thereof in good
faith in order to provide a reasonably acceptable alternative to the term,
covenant or condition of this Agreement or the application thereof that is
invalid, illegal or unenforceable, it being the intent of the Parties that the
basic purposes of this Agreement are to be effectuated.
 
11.11. Status. Nothing in this Agreement is intended or shall be deemed to
constitute a partner, agency, employer-employee, or joint venture relationship
between the Parties.

11.12. Section 365(n). All licenses granted under this Agreement are deemed to
be, for purposes of Section 365(n) of the U.S. Bankruptcy Code, licenses of
right to “intellectual property” as defined in Section 101 of such Code.
 
11.13. Further Assurances. Each Party agrees to execute, acknowledge and deliver
such further instructions, and to do all such other acts, as may be necessary or
appropriate in order to carry out the purposes and intent of this Agreement.
 
11.14. Counterparts. This Agreement may be executed simultaneously in one or
more counterparts (including by facsimile), each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.

[Signature Page Follows]

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IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by
their duly authorized representative.

NEXMED INC.
 
WARNER CHILCOTT COMPANY, INC.
                                     
By:
/s/ Vivian H. Liu
 
By:
/s/ Max Torres
             
Name:
Vivian H. Liu
 
Name:
Max Torres
             
Title:
Chief Executive Officer
 
Title:
Senior Director
 

 
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Exhibit A - Refrigerated Formulation Labeling

In connection with the Approval of the labeling with respect to the Refrigerated
Formulation NDA, the FDA shall not require any material adverse revisions to the
labeling set forth in the Refrigerated Formulation NDA submitted to the FDA
prior to the Effective Date. The initial dose of the Refrigerated Formulation
set forth in the Dosage and Administration section of such labeling as approved
by the FDA shall be 300 mcg and such labeling shall not require or suggest that
a physician titrate from a 200 mcg dose.

In connection with the Approval of the Refrigerated Formulation NDA, the FDA
shall not require the implementation of a Risk Evaluation and Mitigation
Strategy (REMS) or distribution restrictions
 
EX-A-1

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Exhibit B - Divided Patents

DIVIDED - Compositions, Penetration Enhancers and Applicators
 
Patent No.
Appln. No.
Filed
Granted
Title
 
4,980,378
07/201,029
June 1, 1988
December 25, 1990
Biodegradable Absorption Enhancers
 
5,082,866
07/566,758
August 14, 1990
January 21, 1992
Biodegradable Absorption Enhancers
NMD-102
6,046,244
08/964,509
November 5, 1997
April 4, 2000
Topical Compositions For Prostaglandin E1 Delivery
NMD-107
6,118,020
09/314,571
May 19, 1999
September 12, 2000
Crystalline Salts Of Dodecyl 2-(N, N-Dimethylamino)-Propionate
NMD-110
6,224,573
09/232,360
January 15, 1999
May 1, 2001
Medicament Dispenser
NMD-113
6,414,028
09/542,668
April 4, 2000
July 2, 2002
Topical Compositions Containing Prostaglandin E1
NMD-121
7,105,571
10/236,485
September 6, 2002
September 12, 2006
Prostaglandin Compositions And Methods Of Treatment For Male Erectile
Dysfunction [Claims to compositions]
NMD-125
6,841,574
10/336,481
January 3, 2003
January 11, 2005
Topical Stabilized Prostaglandin E Compound Dosage Forms

EX-B-1

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Exhibit C - Undivided Patents

UNDIVIDED - Methods of Treating Erectile Dysfunction and Suitable Applicator
plus Medicament
 
Patent No.
Serial No.
Filed
Granted
Title
NMD-118
6,323,241
09/480,738
January 10, 2000
November 27, 2001
Prostaglandin Compositions And Methods Of Treatment For Male Erectile
Dysfunction [Claims to Methods of Treatment]
NMD-123
6,693,135
09/947,617
September 6, 2001
February 17, 2004
Prostaglandin Compositions And Methods Of Treatment For Male Erectile
Dysfunction [Claims to Applicator and Medicament]

EX-C-1

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