EXHIBIT 10.3

KOS PHARMACEUTICALS
CHANGE IN CONTROL SEVERANCE PLAN
          The Board of Directors (the “Board”) of Kos Pharmaceuticals, Inc. (the
“Company”) recognizes the importance to the best interests of the Company and
its shareholders of ensuring that the Company and its subsidiaries have the
continued dedication and leadership of the Company’s employees, notwithstanding
the possibility, threat or occurrence of a Change in Control (as defined below).
The Board recognizes that the possibility of a Change in Control and the
uncertainty it may create among employees may result in the departure or
distraction of Company personnel to the detriment of the Company and its
shareholders. Therefore, the Board has decided to ratify the Compensation and
Stock Option Committee’s approved this Change in Control Severance Plan (this
“Plan”) in order to encourage the retention of employees and to reduce the level
of uncertainty and distraction that is likely to result from a Change in Control
or a potential Change in Control.
          SECTION 1. Definitions. For purposes of this Plan, the following terms
shall have the meanings set forth below:
     (a) “280G Gross-Up Payment” shall have the meaning set forth in
Section 5(a).
     (b) “Accounting Firm” shall have the meaning set forth in Section 5(b).
     (c) “Accrued Rights” shall have the meaning set forth in Section 4(a)(iv).
     (d) “Affiliate(s)” means, with respect to any specified Person, any other
Person that, directly or indirectly, through one or more intermediaries,
controls, is controlled by, or is under common control with, such specified
Person.
     (e) “Annual Base Salary” means, with respect to any Participant, such
Participant’s annual rate of base salary in effect immediately prior to such
Participant’s Termination Date.
     (f) “Annual Bonus” means, with respect to any Participant and as of such
Participant’s Termination Date, 110% of the average of the regular annual cash
bonuses (or, in the case of sales personnel, annual commissions), excluding
special or one-time bonuses or commissions, actually paid to the Participant in
each of the two full years prior to the year in which such Participant’s
Termination Date occurs; provided that if such Participant has not been employed
for a sufficient length of time to have been eligible for two such bonuses or
commissions (whether or not any bonus or commission was actually paid), “Annual
Bonus” shall be calculated on the basis of the average of the regular annual
cash bonuses or commissions (excluding special or one-time bonuses or
commissions) actually paid to other employees of similar position in each of the
two full years prior to the year in which the Participant’s Termination Date
occurs.

 

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     (g) “Cause” means, with respect to any Participant, the occurrence of any
one of the following:
     (i) the Participant is convicted of, or pleads guilty or nolo contendere
to, (A) a misdemeanor involving moral turpitude or that involves
misappropriation of the assets of the Company or a Subsidiary or (B) a felony;
     (ii) the Participant commits one or more acts or omissions constituting
negligence, fraud or other misconduct that the Company reasonably and in good
faith determines has a materially detrimental effect on the Company;
     (iii) the Participant continually and willfully fails, for at least 14 days
following written notice from the Company, to perform substantially the
Participant’s employment (other than as a result of incapacity due to physical
or mental illness or after delivery by the Participant of a Notice of
Termination for Good Reason); or
     (iv) the Participant commits a material violation of any of the Company’s
material policies (including the Company’s Code of Business Conduct and Ethics,
as in effect from time to time) that the Company reasonably and in good faith
determines is materially detrimental to the best interests of the Company.
     (h) “Change in Control” means any corporation or other entity or group
(within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) other
than the Controlling Shareholders becomes the beneficial owner, directly or
indirectly, of all of the outstanding shares of common stock of the Company.
     (i) “Change in Control Date” means the date on which a Change in Control
occurs (if any).
     (j) “Code” means the Internal Revenue Code of 1986, as amended from time to
time, and the regulations promulgated thereunder.
     (k) “Controlling Shareholders” means, collectively, the group of
shareholders set forth in the Schedule 13D filed with the Securities and
Exchange Commission on September 12, 2006, consisting of Michael Jaharis, Mary
Jaharis, Wilson Point Holdings, LP, Cubs Management, LLC, Kos Investments, Inc.,
Kos Holdings, Inc., Kathryn Jaharis, Steven Jaharis and Jaharis Holdings, Inc,
LLC.
     (l) “Disability” means, with respect to any Participant, that the
Participant becomes eligible to receive income replacement benefits under any
long term disability plan covering employees of the Company or its Subsidiaries.
     (m) “Effective Date” shall have the meaning set forth in Section 13.
     (n) “Exchange Act” means the Securities Exchange Act of 1934, as amended
from time to time, or any successor statute thereto.

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     (o) “Excise Tax” means the excise tax imposed by Section 4999 of the Code,
together with any interest or penalties imposed with respect to such tax.
     (p) “Extension Date” shall have the meaning set forth in Section 13.
     (q) “Good Reason” means, with respect to any Participant and without such
Participant’s express written consent, the occurrence of any one or more of the
following:
     (i) a greater than 10% reduction of the Participant’s annual base salary,
or any material reduction in the total cash compensation that the Participant is
eligible to earn, from the level in effect immediately prior to the Change in
Control Date;
     (ii) any demotion or other significant reduction in the job
responsibilities held by the Participant immediately prior to the Change in
Control Date or any significant change to the reporting relationships of the
Participant as in effect immediately prior to the Change in Control Date; or
     (iii) any change of the Participant’s principal place of employment to a
location more than (i) in the case of Participants who are not sales personnel,
65 miles from the Participant’s principal place of employment immediately prior
to the Change in Control Date and (ii) in the case of Participants who are sales
personnel, 50 miles from the Participant’s principal residence immediately prior
to the Change in Control Date.
          The Participant’s right to terminate employment for Good Reason shall
not be affected by the Participant’s incapacity due to physical or mental
illness. A termination of employment by the Participant for Good Reason for
purposes of this Plan shall be effectuated by giving the Company written notice
(“Notice of Termination for Good Reason”) of the termination setting forth in
reasonable detail the specific conduct of the Company that constitutes Good
Reason and the specific provisions of this Plan on which the Participant relied.
Unless the parties agree otherwise, a termination of employment by the
Participant for Good Reason shall be effective on the 30th day following the
date when the Notice of Termination for Good Reason is given, unless the Company
elects to treat such termination as effective as of an earlier date; provided,
however, that so long as an event that constitutes Good Reason occurs during the
Protection Period, for purposes of the payments, benefits and other entitlements
set forth in Section 4(a), the termination of the Participant’s employment
pursuant thereto shall be deemed to be a resignation for Good Reason during the
Protection Period.
     (r) “Notice of Termination for Good Reason” shall have the meaning set
forth in Section 1(q).
     (s) “Participant” shall have the meaning set forth in Section 2.
     (t) “Payment” means any payment, benefit or distribution (or combination
thereof) by the Company, any of its Affiliates or any trust established by the
Company or its Affiliates, to or for the benefit of a Participant, whether paid,
payable, distributed,

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distributable or provided pursuant to this Plan or otherwise, including any
payment, benefit or other right that constitutes a “parachute payment” within
the meaning of Section 280G of the Code.
     (u) “Person” means a “person” (as such term is used in Section 13(d) of the
Exchange Act.
     (v) “Protection Period” means the period commencing on the Change in
Control Date and ending on the first anniversary thereof.
     (w) “Release Effective Date” shall have the meaning set forth in
Section 4(a)(i).
     (x) “Section 409A Tax” shall have the meaning set forth in Section 6.
     (y) “Severance Multiple” means, with respect to any Participant, the number
indicated on the chart set forth on Schedule A hereto based on such
Participant’s Years of Service and job classification; provided, however, that
the Severance Multiple of (i) Participants who are classified as directors,
managers or professionals shall not be less than 52, (ii) Participants who are
classified sales personnel shall not be less than 39, and (iii) all other
Participants shall not be less than 26.
     (z) “Subsidiary” means any entity in which the Company, directly or
indirectly, possesses 50% or more of the total combined voting power of all
classes of its stock.
     (aa) “Successor” shall have the meaning set forth in Section 10.
     (bb) “Termination Date” means the date on which the termination of a
Participant’s employment, in accordance with the terms of this Plan, is
effective.
     (cc) “Underpayment” shall have the meaning set forth in Section 5(b).
     (dd) “Years of Service” means, with respect to any Participant, the number
of full years that such Participant has been an employee of the Company or its
Subsidiaries as of such Participant’s Termination Date. For purposes hereof,
“year” means any period of 12 consecutive calendar months, without regard to any
short-term leave, parental leave or other approved absence.
          SECTION 2. Eligibility. Participants in this Plan (“Participants”) are
those individuals who are classified as employees of the Company and its
Subsidiaries who are employed by the Company or its Subsidiaries on or following
the Effective Date, other than any such employee who enters into an individual
change in control severance agreement with the Company; provided, however, that
in the case of any such employee who is or becomes a Participant prior to the
Change in Control Date but who is not employed by the Company or its
Subsidiaries immediately prior to the Change in Control Date, such employee
shall not be treated as a Participant for purposes of this Plan.

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          SECTION 3. Impact of a Change in Control on Equity Compensation
Awards. Effective as of any Change in Control Date during the period of this
Plan’s effectiveness, notwithstanding any provision to the contrary in any of
the Company’s equity-based, equity-related or other long-term incentive
compensation plans, practices, policies and programs (including the Company’s
1996 Stock Option Plan and 2006 Incentive Plan) or any award agreements
thereunder, (a) all outstanding stock options, stock appreciation rights,
restricted shares and similar rights and awards then held by each Participant
that are unexercisable or otherwise unvested shall automatically become fully
vested and immediately exercisable, as the case may be, (b) all outstanding
equity-based, equity-related and other long-term incentive awards then held by
such Participant that are subject to performance-based vesting criteria shall
automatically become fully vested and earned at a deemed performance level equal
to the maximum performance level with respect to such awards and (c) all other
outstanding equity-based, equity-related and long-term incentive awards, to the
extent not covered by the foregoing clause (a) or (b), then held by such
Participant that are unvested or subject to restrictions or forfeiture shall
automatically become fully vested and all restrictions and forfeiture provisions
related thereto shall lapse.
          SECTION 4. Termination of Employment. (a) Termination During the
Protection Period by the Company Without Cause or by the Participant for Good
Reason. Subject to Section 4(a)(v), if a Participant’s employment is terminated
either (x) by the Company or its Subsidiaries other than for Cause, death or
Disability or (y) by resignation of the Participant with Good Reason, in each
case during the Protection Period, then the Participant shall be entitled to the
following payments and benefits:
               (i) Severance Pay. The Company shall pay the Participant an
amount equal to the sum of (A) a number of weeks of the Participant’s Annual
Base Salary (without regard to any reduction giving rise to Good Reason) equal
to the Severance Multiple and (B) the Participant’s Annual Bonus multiplied by a
fraction the numerator of which is the Severance Multiple and the denominator of
which is 52, which sum shall be payable in a lump-sum payment on the tenth
business day after the date the release described in Section 4(a)(v) becomes
effective and irrevocable (the “Release Effective Date”); provided, however,
that such amount shall be paid in lieu of, and the Participant hereby waives the
right to receive, any other cash severance payment relating to salary or bonus
continuation the Participant is otherwise eligible to receive upon termination
of employment under any severance plan, practice, policy or program of the
Company or any Subsidiary.
               (ii) Prorated Annual Bonus. The Company shall pay the Participant
an amount equal to the product of (A) the Participant’s target annual bonus for
the year in which the Termination Date occurs (assuming all individual and
business criteria are met at target levels) and (B) a fraction, the numerator of
which is the number of days in the current fiscal year through such Termination
Date, and the denominator of which is 365, in a lump-sum payment on the tenth
business day after the Release Effective Date.
               (iii) Continued Welfare Benefits. The Company shall continue to
provide for a number of weeks equal to the Severance Multiple medical and
welfare benefits to the

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Participant and the Participant’s spouse and dependents (in each case, as
provided in the applicable plan) at least equal to the levels of benefits
provided by the Company and its Subsidiaries immediately prior to the Change in
Control Date. Nothing in this Section 4(a)(iii) shall operate to reduce, or be
construed as reducing, the Participant’s group health plan continuation rights
under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, in
any manner.
               (iv) Accrued Rights. The Participant shall be entitled to
(A) payments of any unpaid annual base salary, annual bonus, commissions or
other amounts earned or accrued through the Participant’s Termination Date and
(B) except as provided in Section 4(a)(i), any payments or benefits explicitly
set forth in any other agreements, benefit plans, practices, policies,
arrangements and programs to which the Participant is a party or in which the
Participant participates (the rights to such payments, the “Accrued Rights”).
               (v) Release of Claims. Notwithstanding any provision of this Plan
to the contrary, the Company shall not be obligated to make any payments or
provide any benefits described in this Section 4(a), other than payments or
benefits in respect of the Accrued Rights, unless and until such time as the
Participant has executed and delivered a Separation Agreement and Release
substantially in the form of Exhibit A hereto and such release has become
effective and irrevocable in accordance with its terms.
     (b) Other Termination. If a Participant’s employment is terminated in any
circumstance not described in Section 4(a) (including as a result of death or
Disability), the Participant shall not be entitled to any compensation or
benefits described in Section 4(a) other than any payments with respect to the
Accrued Rights.
          SECTION 5. Certain Additional Payments by the Company.
(a) Notwithstanding anything in this Plan to the contrary and except as set
forth below, in the event it shall be determined that any Payment that is paid
or payable to or for the benefit of a Participant during the period of this
Plan’s effectiveness would be subject to the Excise Tax, such Participant shall
be entitled to receive an additional payment (a “280G Gross-Up Payment”) in an
amount such that, after payment by such Participant of all taxes (and any
interest or penalties imposed with respect to such taxes), including any income
and employment taxes (and any interest and penalties imposed with respect
thereto) and Excise Taxes imposed upon the 280G Gross-Up Payment, such
Participant retains an amount of the 280G Gross-Up Payment equal to the Excise
Tax imposed upon such Payments. The Company’s obligation to make 280G Gross-Up
Payments under this Section 5 shall not be conditioned upon a Participant’s
termination of employment and shall survive and apply after such Participant’s
termination of employment. At the time of any Payment during the period of this
Plan’s effectiveness, the Company shall provide each Participant a written
description of the application of the Excise Tax (if any) to such Payment.
     (b) Subject to the provisions of Section 5(c), all determinations required
to be made under this Section 5, including whether and when a 280G Gross-Up
Payment is required, the amount of such 280G Gross-Up Payment and the
assumptions to be utilized

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in arriving at such determination, shall be made in accordance with the terms of
this Section 5 by a nationally recognized certified public accounting firm that
shall be designated by the Company (other than the Company’s regular auditor)
(the “Accounting Firm”). The Accounting Firm shall provide detailed supporting
calculations both to the Company and the applicable Participant within 15
business days of the receipt of notice from the Participant that there has been
a Payment or such earlier time as is requested by the Company. For purposes of
determining the amount of any 280G Gross-Up Payment, each Participant shall be
deemed to pay Federal income tax at the highest marginal rate applicable to
individuals in the calendar year in which any such 280G Gross-Up Payment is to
be made and deemed to pay state and local income taxes at the highest marginal
rates applicable to individuals in the state or locality of the Participant’s
residence or place of employment in the calendar year in which any such 280G
Gross-Up Payment is to be made, net of the maximum reduction in Federal income
taxes that can be obtained from deduction of state and local taxes, taking into
account limitations applicable to individuals subject to Federal income tax at
the highest marginal rate. All fees and expenses of the Accounting Firm shall be
borne solely by the Company. Any 280G Gross-Up Payment, as determined pursuant
to this Section 5, shall be paid by the Company to the applicable Participant
within 5 business days of the receipt of the Accounting Firm’s determination. If
the Accounting Firm determines that no Excise Tax is payable by such
Participant, it shall so indicate to such Participant in writing. Any
determination by the Accounting Firm shall be binding upon the Company and the
applicable Participant. As a result of the uncertainty in the application of the
Excise Tax, at the time of the initial determination by the Accounting Firm
hereunder, it is possible that the amount of the 280G Gross-Up Payment
determined by the Accounting Firm to be due to a Participant, consistent with
the calculations required to be made hereunder, will be lower than the amount
actually due, including any interest and penalties (an “Underpayment”). In the
event the Company exhausts its remedies pursuant to Section 5(c) and such
Participant thereafter is required to make a payment of any Excise Tax, the
Accounting Firm shall determine the amount of the Underpayment that has occurred
and any such Underpayment shall be paid by the Company to such Participant
within 5 business days of the receipt of the Accounting Firm’s determination.
     (c) Each Participant shall notify the Company in writing of any written
claim by the Internal Revenue Service that, if successful, would require the
payment by the Company of a 280G Gross-Up Payment. Such notification shall be
given as soon as practicable, but no later than 10 business days after the
Participant is informed in writing of such claim. Failure to give timely notice
shall not prejudice any Participant’s right to 280G Gross-Up Payments and rights
of indemnity under this Section 5, unless, and solely to the extent that, the
Company has been prejudiced in a material respect by such failure. Each
Participant shall apprise the Company of the nature of such claim and the date
on which such claim is requested to be paid. No Participant shall pay such claim
prior to the expiration of the 30-day period following the date on which the
Participant gives such notice to the Company (or such shorter period ending on
the date that any payment of taxes with respect to such claim is due). If the
Company notifies a Participant in writing prior to the expiration of such period
that the Company desires to contest such claim, the Participant shall (i) give
the Company any information reasonably requested by the Company relating to such
claim, (ii) take such action in connection with contesting such

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claim as the Company shall reasonably request in writing from time to time,
including accepting legal representation with respect to such claim by an
attorney reasonably selected by the Company, (iii) cooperate with the Company in
good faith in order effectively to contest such claim and (iv) permit the
Company to participate in any proceedings relating to such claim; provided,
however, that the Company shall bear and pay directly all costs and expenses
(including additional income taxes, interest and penalties) incurred in
connection with such contest, and shall indemnify and hold the Participant
harmless, on an after-tax basis, for any Excise Tax or income tax (including
interest or penalties) imposed as a result of such representation and payment of
costs and expenses. Without limitation on the foregoing provisions of this
Section 5(c), the Company shall control all proceedings taken in connection with
such contest, and, at its sole discretion, may pursue or forgo any and all
administrative appeals, proceedings, hearings and conferences with the
applicable taxing authority in respect of such claim and may, at its sole
discretion, either direct the Participant to pay the tax claimed and sue for a
refund or contest the claim in any permissible manner, and the Participant
agrees to prosecute such contest to a determination before any administrative
tribunal, in a court of initial jurisdiction and in one or more appellate
courts, as the Company shall determine; provided, however, that (A) if the
Company directs the Participant to pay such claim and sue for a refund, the
Company shall advance the amount of such payment to the Participant, on an
interest-free basis, and shall indemnify and hold the Participant harmless, on
an after-tax basis, from any Excise Tax or income tax (including interest or
penalties) imposed with respect to such advance or with respect to any imputed
income in connection with such advance and (B) if such contest results in any
extension of the statute of limitations relating to payment of taxes for the
taxable year of the Participant with respect to which such contested amount is
claimed to be due, such extension must be limited solely to such contested
amount. Furthermore, the Company’s control of the contest shall be limited to
issues with respect to which the 280G Gross-Up Payment would be payable
hereunder, and each Participant shall be entitled to settle or contest, as the
case may be, any other issue raised by the Internal Revenue Service or any other
taxing authority.
     (d) If, after the receipt by a Participant of an amount advanced by the
Company pursuant to Section 5(c), the Participant becomes entitled to receive
any refund with respect to such claim, the Participant shall (subject to the
Company’s complying with the requirements of Section 5(c)) promptly pay to the
Company the amount of such refund received (together with any interest paid or
credited thereon after taxes applicable thereto). If, after the receipt by a
Participant of an amount advanced by the Company pursuant to Section 5(c), a
determination is made that the Participant shall not be entitled to any refund
with respect to such claim and the Company does not notify the Participant in
writing of its intent to contest such denial of refund prior to the expiration
of the 30-day period after such determination, then such advance shall be
forgiven and shall not be required to be repaid and the amount of such advance
shall offset, to the extent thereof, the amount of 280G Gross-Up Payment
required to be paid.
          SECTION 6. Section 409A. It is the intention of the Company that the
provisions of this Plan comply with Section 409A of the Code, and all provisions
of this Plan shall be construed and interpreted in a manner consistent with
Section 409A of the

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Code. To the extent necessary to avoid imposition of any additional tax or
interest penalties under Section 409A (such tax and interest penalties, a
“Section 409A Tax”), notwithstanding the timing of payment provided in any other
Section of this Plan, the timing of any payment, distribution or benefit
pursuant to this Plan shall be subject to a six-month delay in a manner
consistent with Section 409A(a)(2)(B)(i) of the Code; provided that if a
Participant dies during such six-month period, any such delayed payments shall
not be further delayed, and shall be immediately payable to the Participant’s
devisee, legatee or other designee or, should there be no such designee, to the
Participant’s estate in accordance with the applicable provisions of this Plan.
From and after the Effective Date, (i) the Company shall administer and operate
this Plan in compliance with Section 409A of the Code and any rules, regulations
or other guidance promulgated thereunder as in effect from time to time and
(ii) in the event that the Company determines that any provision of this Plan
does not comply with Section 409A of the Code or any such rules, regulations or
guidance and that as a result any Participant may become subject to a
Section 409A Tax, the Company shall amend or modify such provision to avoid the
application of such Section 409A Tax, provided that such amendment or
modification shall not reduce the economic value to the Participants of such
provision.
          SECTION 7. No Mitigation or Offset; Enforcement of this Plan. (a) The
Company’s obligation to make the payments provided for in this Plan and
otherwise to perform its obligations hereunder shall not be affected by any
set-off, counterclaim, recoupment, defense or other claim, right or action which
the Company may have against any Participant or others. In no event shall any
Participant be obligated to seek other employment or take any other action by
way of mitigation of the amounts payable to the Participant under any of the
provisions of this Plan and, except as otherwise expressly provided for in this
Plan, such amounts shall not be reduced whether or not the Participant obtains
other employment.
     (b) In the event that any Participant is the prevailing party in any
contest, dispute or proceeding regarding the Participant’s rights pursuant to
this Plan, the Company shall reimburse, upon the Participant’s written demand,
any and all reasonable legal fees and expenses that the Participant may incur as
a result of such contest, dispute or proceeding (including as a result of any
contest regarding the amount of any payment owed pursuant to this Plan), and
shall indemnify and hold the Participant harmless, on an after-tax basis, for
any tax (including Excise Tax) imposed on the Participant as a result of payment
by the Company of such legal fees and expenses.
          SECTION 8. Non-Exclusivity of Rights. Except as specifically provided
in Sections 2 and 4(a)(i), nothing in this Plan shall prevent or limit a
Participant’s continuing or future participation in any plan, practice, policy
or program provided by the Company or a Subsidiary for which the Participant may
qualify, nor shall anything in this Plan or the accompanying Separation
Agreement and Release limit or otherwise affect any rights the Participant may
have under any contract or agreement with the Company or a Subsidiary. Vested
benefits and other amounts a Participant is otherwise entitled to receive under
any incentive compensation (including any equity award agreement), deferred
compensation, retirement, pension or other plan, practice, policy or program of,

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or any contract or agreement with, the Company or a Subsidiary shall be payable
in accordance with the terms of each such plan, practice, policy, program,
contract or agreement, as the case may be, except as explicitly modified by this
Plan.
          SECTION 9. Withholding. The Company may deduct and withhold from any
amounts payable under this Plan such Federal, state, local, foreign or other
taxes as are required to be withheld pursuant to any applicable law or
regulation.
          SECTION 10. Successors. This Plan shall bind any successor (a
“Successor”) to all or substantially all of the business or assets of the
Company (whether direct or indirect, by purchase, merger, consolidation or
otherwise), in the same manner and to the same extent that the Company would
have been obligated under this Plan if no such succession had taken place. In
the case of any transaction in which a Successor would not, pursuant to the
foregoing provision or by operation of law, be bound by this Plan, the Company
shall require such Successor expressly and unconditionally to assume and agree
to perform the Company’s obligations under this Plan, in the same manner and to
the same extent that the Company would have been required to perform such
obligations if no such succession had taken place. The term “Company”, as used
in this Plan, shall mean the Company as hereinbefore defined and any Successor
and any assignee to such business or assets which by reason hereof becomes bound
by this Plan.
          SECTION 11. Default in Payment. Any payment not made within ten
business days after it is due in accordance with this Plan shall thereafter bear
interest, compounded annually, at the prime rate in effect from time to time at
Citibank, N.A., or any successor thereto.
          SECTION 12. GOVERNING LAW. THIS PLAN SHALL BE DEEMED TO BE MADE IN THE
STATE OF NEW JERSEY, AND THE VALIDITY, INTERPRETATION, CONSTRUCTION AND
PERFORMANCE OF THIS PLAN IN ALL RESPECTS SHALL BE GOVERNED BY THE LAWS OF THE
STATE OF NEW JERSEY WITHOUT REGARD TO ITS PRINCIPLES OF CONFLICTS OF LAW.
          SECTION 13. Duration; Termination. This Plan shall become effective
upon the date of its adoption by the Board (the “Effective Date”), and shall
remain in effect until the second anniversary thereof. Notwithstanding the
foregoing, in the event of a Change in Control during the period of this Plan’s
effectiveness, this Plan shall continue in full force and effect in accordance
with its terms and shall not terminate or expire until all the Company’s
obligations to all Participants have been satisfied in full; provided, however,
that this Plan shall only be effective with respect to the first Change in
Control that occurs following the Effective Date and the Participants shall not
be entitled to any payments or benefits pursuant to this Plan with respect to
any subsequent Change in Control.
          SECTION 14. Amendment or Modification. The Board may amend or modify
this Plan at any time; provided, however, that except as specifically required
by Section 6, on and after the Change in Control Date, this Plan may not be
amended at any

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time in a manner that is adverse to a Participant without the prior written
consent of such Participant. The failure of a Participant to insist upon strict
adherence to any term of this Plan on any occasion shall not be considered a
waiver of such Participant’s rights or deprive such Participant of the right
thereafter to insist upon strict adherence to that term or any other term of
this Plan. No failure or delay by any Participant in exercising any right or
power hereunder will operate as a waiver thereof, nor will any single or partial
exercise of any such right or power, or any abandonment of any steps to enforce
such right or power, preclude any other or further exercise thereof or the
exercise of any other right or power.
          SECTION 15. Severability. If any term or provision of this Plan is
invalid, illegal or incapable of being enforced by any applicable law or public
policy, all other conditions and provisions of this Plan shall nonetheless
remain in full force and effect.
          SECTION 16. Survival. The provisions of this Plan, including
Sections 4, 5, 6, 7, 10 and 11, shall survive and remain binding and
enforceable, notwithstanding the expiration or termination of this Plan, the
termination of a Participant’s employment with the Company for any reason or any
settlement of the financial rights and obligations arising from such
Participant’s participation hereunder, to the extent necessary to preserve the
intended benefits of such provisions.
          SECTION 17. Notices. All notices or other communications required or
permitted by this Plan will be made in writing and all such notices or
communications will be deemed to have been duly given when delivered or (unless
otherwise specified) mailed by United States certified or registered mail,
return receipt requested, postage prepaid, addressed as follows:

     
(a) If to the Company:
  Kos Pharmaceuticals, Inc.
 
  1 Cedar Brook Drive
 
  Cranbury, NJ 08512-3618
 
   
 
  Attention: Executive Vice President, General Counsel and Corporate Secretary
 
   
 
  Fax: 609-497-0907
 
   
(b) If to a Participant,
  to such Participant’s address as most recently supplied to the Company and set
forth in the Company’s records;

or to such other address as any party may have furnished to the other in writing
in accordance herewith, except that notices of change of address shall be
effective only upon receipt.
          SECTION 18. Headings and References. The headings of this Plan are
inserted for convenience only and neither constitute a part of this Plan nor
affect in any

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way the meaning or interpretation of this Plan. When a reference in this Plan is
made to a Section, such reference shall be to a Section of this Plan unless
otherwise indicated.
          SECTION 19. Interpretation. For purposes of this Plan, the words
“include” and “including”, and variations thereof, shall not be deemed to be
terms of limitation but rather shall be deemed to be followed by the words
“without limitation”. The term “or” is not exclusive. The word “extent” in the
phrase “to the extent” shall mean the degree to which a subject or other thing
extends, and such phrase shall not mean simply “if”.
Adopted by the Board of Directors of Kos
Pharmaceuticals, Inc., as of November 5, 2006.

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SCHEDULE A

                            SEVERANCE MULTIPLE           Directors, Managers    
            Years of Service     and Professionals     Sales Personnel    
Others    
Less than 1
    6     3     3    
1 Year but less than 2
    9     4.5     3    
2 Years but less than 3
    12     6     6    
3 Years but less than 4
    18     9     9    
4 Years but less than 5
    24     12     12    
5 Years but less than 6
    30     15     15    
6 Years but less than 7
    36     21     18    
7 Years but less than 8
    42     27     21    
8 Years but less than 10
    48     33     24    
10 Years but less than 15
    54     39     27    
15 or more Years
    60     45     33    

 

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EXHIBIT A
SEPARATION AGREEMENT AND RELEASE
     I. Release. For good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the undersigned, with the intention
of binding himself/herself, his/her heirs, executors, administrators and
assigns, does hereby release and forever discharge Kos Pharmaceuticals, Inc., a
Florida corporation , [to be amended, if necessary, to add or identify any
additional or other entity that may be the Executive’s employer at the time of
the Qualifying Termination set forth in Section 4 of that certain Change in
Control Severance Agreement between the Executive and Company] (the “Company”),
and its or their parents, subsidiaries, affiliates, predecessors, successors,
and/or assigns, past, present, and future, together with its and their officers,
directors, executives, agents, employees, and employee benefits plans (and the
trustees, administrators, fiduciaries and insurers of such plans), past,
present, and future (collectively, the “Released Parties”), from any and all
claims, actions, causes of action, demands, rights, damages, debts, accounts,
suits, expenses, attorneys’ fees and liabilities of whatever kind or nature in
law, equity, or otherwise, whether now known or unknown (collectively, the
“Claims”), which the undersigned now has, owns or holds, or has at any time
heretofore had, owned or held against any Released Party, from the beginning of
time to the date of the Executive’s execution of this Separation Agreement and
Release, including without limitation, any Claims arising out of or in any way
connected with the undersigned’s employment relationship with the Company, its
subsidiaries, predecessors or affiliated entities, or the termination thereof,
under any Federal, state or local statute, rule, or regulation, or principle of
common, tort or contract law, including but not limited to, the Family and
Medical Leave Act of 1993, as amended (the “FMLA”), 29 U.S.C. §§ 2601 et seq.,
Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. §§ 2000e et
seq., the Age Discrimination in Employment Act of 1967, as amended, 29 U.S.C. §§
621 et seq., the Americans with Disabilities Act of 1990, as amended, 42 U.S.C.
§§ 12101 et seq., the Worker Adjustment and Retraining Notification Act of 1988,
as amended, 29 U.S.C. §§ 2101 et seq., the Employee Retirement Income Security
Act of 1974, as amended, 29 U.S.C. §§ 1001 et seq., and all other Federal,
state, or local statutes, regulations or laws (including but not limited to the
New Jersey Conscientious Employee Protection Act, if applicable); provided,
however, that nothing herein shall release the Company of its obligations under
that certain Change in Control Severance Plan of the Company (including the
Accrued Rights (as defined therein)). Except as set forth in Section II below,
the undersigned understands that, as a result of executing this Separation
Agreement and Release, he/she will not have the right to assert that the Company
or any other Released Party unlawfully terminated his/her employment or violated
any of his/her rights in connection with his/her employment or otherwise.
     The undersigned affirms that he/she is not presently party to any Claim,
complaint or action against any Released Party in any forum or form and that
he/she knows of no facts which may lead to any Claim, complaint or action being
filed against any Released Party in any forum by the undersigned or by any
agency, group, etc. The undersigned further affirms that he/she has been paid
and/or has received all leave (paid

 

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or unpaid), compensation, wages, bonuses, commissions, and/or benefits to which
he/she may be entitled and that no other leave (paid or unpaid), compensation,
wages, bonuses, commissions and/or benefits are due to him/her from the Company
and its subsidiaries, except as specifically provided in this Separation
Agreement and Release. The undersigned furthermore affirms that he/she has no
known workplace injuries or occupational diseases and has been provided and/or
has not been denied any leave requested under the FMLA. If any agency or court
assumes jurisdiction of any such Claim, complaint or action against any Released
Party on behalf of the undersigned, the undersigned hereby waives any right to
individual monetary or other relief.
     The undersigned further declares and represents that he/she has carefully
read and fully understands the terms of this Separation Agreement and Release
and that, through this document, he/she is hereby advised to consult with an
attorney prior to executing this Separation Agreement and Release, that he/she
may take up to and including 21 days from receipt of this Separation Agreement
and Release, to consider whether to sign this Separation Agreement and Release,
that he/she may revoke this Separation Agreement and Release within seven
calendar days after signing it by delivering to the Company written notification
of revocation (and that this Separation Agreement and Release shall not become
effective or enforceable until the expiration of such revocation period), and
that he/she knowingly and voluntarily, of his/her own free will, without any
duress, being fully informed and after due deliberate action, accepts the terms
of and signs the same as his own free act.
     II. Protected Rights. The Company and the undersigned agree that nothing in
this Separation Agreement and Release is intended to or shall be construed to
affect, limit or otherwise interfere with any non-waivable right of the
undersigned under any Federal, state or local law, including the right to file a
charge or participate in an investigation or proceeding conducted by the Equal
Employment Opportunity Commission (“EEOC”) or to exercise any other right that
cannot be waived under applicable law. The undersigned is releasing, however,
his/her right to any monetary recovery or relief should the EEOC or any other
agency pursue Claims on his/her behalf. Further, should the EEOC or any other
agency obtain monetary relief on his/her behalf, the undersigned assigns to the
Company all rights to such relief.
     III. Third-Party Litigation. The undersigned agrees to be available to the
Company and its affiliates on a reasonable basis in connection with any pending
or threatened claims, charges or litigation in which the Company or any of its
affiliates is now or may become involved, or any other claims or demands made
against or upon the Company or any of its affiliates, regardless of whether or
not the undersigned is a named defendant in any particular case.
     IV. Return of Property. The undersigned shall return to the Company on or
before [10 DAYS AFTER TERMINATION DATE], all property of the Company in the
undersigned’s possession or subject to the undersigned’s control, including
without limitation any laptop computers, keys, credit cards, cellular telephones
and files. The undersigned shall not alter any of the Company’s records or
computer files in any way after [TERMINATION DATE].

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     V. Confidential Information. The undersigned acknowledges that Confidential
Information (as defined below) is a valuable asset of the Company and that
unauthorized disclosure or utilization thereof could be detrimental to the
Company. The undersigned, therefore, shall not, after the term of employment
with the Company, disclose in any way or to any extent, to any person or
organization other than the Company, or utilize for the benefit or profit of the
undersigned or any other person or organization other than the Company, any
Confidential Information, except (a) as may be authorized in writing in advance
by the Company; (b) is publicly available or becomes publicly available other
than through a breach of this document by the undersigned or, based on the
undersigned’s knowledge, the breach of this document by others; and (c) upon
prior notification to the Company, the undersigned may be required by law to
disclose. “Confidential Information” means information disclosed — whether
orally or in writing — to the undersigned, or otherwise known to the undersigned
as a direct or indirect result of his or her employment by the Company,
concerning (i) the Company’s products, patent applications, research activities,
formulations, processes, protocols, procedures, other intellectual properties,
machines, services, and all matters having to do with the business or operations
of the Company, including, but not limited to, all information of any type
related to research, product development, manufacturing, quality matters,
purchasing, finance, data processing, engineering, facilities, marketing,
merchandising and selling, personnel, organization matters, policy matters,
legal and other corporate affairs and (ii) information of any type about any
third party with which the Company is in technical or commercial cooperation,
acquired by the undersigned, directly or indirectly, in connection with his or
her employment by the Company. Included in the foregoing definition by way of
illustration, but not limitation, are such items as research projects, findings
or reports, business plans and projections, formulae, processes, methods of
manufacture, computer programs, sales, costs, pricing data, regulatory matters,
operating procedures, information about employees and personnel practices, and
lists of investigators, consultants, suppliers and customers. The undersigned
agrees not to remove any Confidential Information from the Company, not to
request that others do so on the undersigned’s behalf and to return any
Confidential Information currently in the undersigned’s possession to the
Company.
     VI. Severability. If any term or provision of this Separation Agreement and
Release is invalid, illegal or incapable of being enforced by any applicable law
or public policy, all other conditions and provisions of this Separation
Agreement and Release shall nonetheless remain in full force and effect so long
as the economic and legal substance of the transactions contemplated by this
Separation Agreement and Release is not affected in any manner materially
adverse to any party.
     VII. GOVERNING LAW. THIS SEPARATION AGREEMENT AND RELEASE SHALL BE DEEMED
TO BE MADE IN THE STATE OF NEW JERSEY, AND THE VALIDITY, INTERPRETATION,
CONSTRUCTION AND PERFORMANCE OF THIS AGREEMENT IN ALL RESPECTS SHALL BE GOVERNED
BY THE LAWS OF THE STATE OF NEW JERSEY WITHOUT REGARD TO ITS PRINCIPLES OF
CONFLICTS OF LAW.
     Effective on the eighth calendar day following the date set forth below.

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            KOS PHARMACEUTICALS, INC.,
      by: /s/       Name:         Title:           EMPLOYEE,
      by: /s/       [NAME]           

Date Signed:_________________________

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