Exhibit 4.2


 





EXECUTION VERSION


 


FIRST SUPPLEMENTAL
INDENTURE


 


THIS FIRST SUPPLEMENTAL
INDENTURE (this “Supplemental Indenture”), dated as of May 20, 2020, among Zyla Life Sciences, a Delaware corporation
(formerly known as Egalet Corporation) (the “Issuer”), the Guarantors (as defined in the Indenture referred to herein),
Assertio Holdings, Inc. (f/k/a Alligator Zebra Holdings, Inc.), a Delaware corporation (“Holdings”), and Wilmington
Savings Fund Society, FSB (as successor to U.S. Bank National Association), as trustee under the indenture referred to below (in
such capacity, together with its successors and assigns in such capacity, the “Trustee”) and collateral agent under
the indenture referred to below (in such capacity, together with its successors and assigns in such capacity, the “Collateral
Agent”).


 


W I T N E S S E T H


 


WHEREAS, the Issuer
has heretofore executed and delivered to the Trustee and Collateral Agent an indenture (the “Indenture”), dated as
of January 31, 2019, providing for the issuance of 13% Senior Secured Notes due 2024 (the “Notes”);


 


WHEREAS, the Issuer
and the Guarantors propose to amend the Indenture, the Notes and the Collateral Agreement (the “Proposed Amendments”)
as contemplated hereby;


 


WHEREAS, pursuant to
Section 9.02 of the Indenture and Section 8.20 of the Collateral Agreement, the Issuer, the Guarantors, the Trustee and the Collateral
Agent may amend or supplement the Indenture, the Notes and the Collateral Agreement as contemplated hereby provided that the Holders
of the Notes then outstanding have consented;


 


WHEREAS, upon the terms
and conditions set forth therein, the Holders of the Notes currently outstanding have agreed to consent to the Proposed Amendments;


 


WHEREAS, pursuant to
that certain agreement and plan of merger, dated as of March 16, 2020, by and among Holdings, Assertio Therapeutics, Inc., a Delaware
corporation, Zebra Merger Sub, Inc., a Delaware corporation, Alligator Merger Sub, Inc., a Delaware corporation and the Issuer
(the “Merger Agreement”), a wholly-owned subsidiary of Holdings will merge with and into the Issuer (the “Merger”),
Holdings will become the owner of the equity of the Issuer and will expressly assume the obligations of the Issuer under the Indenture,
the Securities, the Intercreditor Agreements and the Security Documents as required by Section 5.01(a) of the Indenture;


 


WHEREAS, pursuant to
Section 9.02 of the Indenture and Section 8.20 of the Collateral Agreement, each of the Trustee and the Collateral Agent is authorized
to execute and deliver this Supplemental Indenture;


 



     


     


    

 


WHEREAS, the Issuer,
each Guarantor and Holdings have been authorized by a resolution of its respective board of directors, managers, managing members
or general partner, as applicable, to enter into this First Supplemental Indenture; and


 


WHEREAS, all other
acts and proceedings required by law, by the Indenture, and by the organizational documents of the Issuer, the Guarantors and Holdings
to make this First Supplemental Indenture a valid and binding agreement for the purposes expressed herein, in accordance with its
terms, have been duly done and performed.


 


NOW THEREFORE, in consideration
of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the parties mutually
covenant and agree as follows:


 


ARTICLE 1



AMENDMENT OF INDENTURE, NOTES AND COLLATERAL AGREEMENT,


ASSUMPTION
and gUARANTEE


 


Following the execution
and delivery by the Issuer, the Guarantors, Holdings, the Collateral Agent and the Trustee of this Supplemental Indenture, the
terms hereof shall become operative on the initial date (the “Operative Date”) of the effective time of the Merger
pursuant to the Merger Agreement; provided that notwithstanding the foregoing or anything herein to the contrary or otherwise,
the Operative Date shall not occur until the payment by the Issuer of the reasonable invoiced fees and expenses of Paul, Weiss,
Rifkind, Wharton & Garrison LLP (“Paul, Weiss”) and Cooley LLP (“Cooley”), each as counsel to one
or more of the Holders consenting to this Supplemental Indenture; provided further that in the event that (x)
the Operative Date shall not occur on or prior to October 17, 2020 or (y) the Merger Agreement shall otherwise be terminated prior
to the consummation of the Merger, then the terms of this Supplemental Indenture (other than the provisions relating to reimbursement
of expenses) (but including the assumption of Holdings and guarantee by the Issuer provided for herein) shall be null and void
and the Indenture and Notes shall continue in full force and effect without any modification or amendment hereby. Effective as
of the Operative Date, (i) the Supplemental Indenture hereby amends the Indenture, the Notes and the Collateral Agreement, (ii)
Holdings expressly assumes the obligations of the Issuer under the Indenture, the Securities, the Intercreditor Agreements and
the Security Documents and the Issuer guarantees the Guaranteed Obligations, in each case, as provided for herein and (iii) from
and after the assumption of the Obligations by Holdings, the term “Issuer” under the Indenture shall refer to Holdings
and the Issuer shall be a Restricted Subsidiary and Subsidiary Guarantor for all purposes under the Indenture.


 


1.1             
Amendment of Section 1.01 of the Indenture. Pursuant to Section 9.02 of the Indenture, the following definitions
are hereby added to Section 1.01 in alphabetical order:


 


1.2             
““Assertio” means Assertio Therapeutics, Inc. (f/k/a Depomed Inc.).


 






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“Assertio Convertible
Debt” means the 2.50% Convertible Senior Notes due 2021 issued by Assertio (the “2021 Assertio Convertible Notes”)
and the 5.00% Convertible Senior Notes due 2024 issued by Assertio.


 


“Depo DR”
means Depo DR Sub, LLC, a Delaware limited liability company.


 


“Merger”
means the merger of a wholly-owned subsidiary of Holdings with and into the Issuer, pursuant to that certain agreement and plan
of merger, dated as of March 16, 2020, by and among Holdings, Assertio Therapeutics, Inc., a Delaware corporation, Zebra Merger
Sub, Inc., a Delaware corporation, Alligator Merger Sub, Inc., a Delaware corporation and the Issuer (as in effect on the date
of this Supplemental Indenture or as amended in a manner not adverse in any material respect to the Holders).


 


“Royalty Purchase
and Sale Agreement” means that certain Royalty Purchase and Sale Agreement, dated as of October 18, 2013, as amended by Amendment
No. 1 thereto dated as of August 2, 2018, among Assertio, Depo DR and PDL Investment Holdings, LLC (as assignee of PDL BioPharma,
Inc.).”


 


1.3             
Amendment of Section 1.01 of the Indenture. Pursuant to Section 9.02 of the Indenture, each of the following definitions
set forth in Section 1.01 of the Indenture is hereby amended as follows:


 


(a)              
The definitions of “Applicable Percentage” and “Net Sales” are hereby deleted.


 


(b)              
The definition of “Asset Sale” is hereby amended by amending and restating clauses (d), (e) and (h) of such
definition in their entirety as follows:


 


“(d)             any disposition
of assets or issuance or sale of Equity Interests of the Issuer or any Restricted Subsidiary, which assets or Equity Interests
so disposed or issued have an aggregate Fair Market Value (as determined in good faith by the Issuer) of less than $5,000,000 on
an individual basis and $10,000,000 in the aggregate; provided that any such disposition of assets or issuance or sale of Equity
Interests shall not be made to (i) Assertio or any of its Subsidiaries by any Person that is not Assertio or one of its Subsidiaries
or (ii) Depo DR;


 


(e)               any
disposition of property or assets, or the issuance of securities, by a Restricted Subsidiary of the Issuer to the Issuer or by
the Issuer or a Restricted Subsidiary of the Issuer to a Restricted Subsidiary of the Issuer (or to an entity that contemporaneously
therewith becomes a Restricted Subsidiary); provided that any such disposition of property or assets or issuance of securities
shall not be made to (i) Assertio or any of its Subsidiaries by any Person that is not Assertio or one of its Subsidiaries or (ii)
Depo DR;


 






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(h)               the
disposition of the Equity Interests in Depo DR pursuant to the Royalty Purchase and Sale Agreement;”


 


(c)              
The definition of “Change of Control” is hereby amended by amending and restating the paragraph at the end of
the definition as follows:


 


“Notwithstanding the foregoing,
(i) the acquisition, directly or indirectly, of 100% of the total voting power of the issued and outstanding Voting Stock of the
Issuer by any Person who, immediately after such acquisition, has no material assets other than the Capital Stock of the Issuer
or its direct or indirect parent company will not, by itself, constitute a Change of Control and (ii) the Merger shall not constitute
a Change of Control.”


 


(d)              
The definition of “Excluded Assets” is hereby amended by replacing clause (v) thereof with the following:


 


“(v)             so long as the Royalty
Purchase and Sale Agreement remains in effect, the Equity Interests of Assertio in Depo DR;”


 


(e)              
The definition of “Investments” is hereby amended by adding the following proviso at the end of such definition:


 


“provided that the acquisition
of the Assertio Convertible Debt shall not constitute an Investment”


 


(f)               
The definition of “Investments” also is amended by adding the following additional sentence at the end of such
definition immediately after the proviso added pursuant to clause (d) above:


 


“Notwithstanding anything
herein to the contrary or otherwise, no Investments (including pursuant to Section 4.06 or the definition of “Permitted Investments”
or otherwise) shall be permitted to be made in (i) Assertio or any of its Subsidiaries by any Person that is not Assertio or one
of its Subsidiaries, except in reliance on clause (19) of the definition of “Permitted Investments”; provided that
the foregoing shall not prohibit Assertio or any of its Subsidiaries from entering into intercompany arrangements, including license
agreements, with a Person that is not Assertio or one of its Subsidiaries pursuant to which such Person may make royalty or similar
transfer pricing payments to Assertio or one of its Subsidiaries, and Assertio or one of its Subsidiaries may receive and retain
such payments, in the amount of the fair value of the assets sold pursuant to such arrangements or (ii) Depo DR.”


 


(g)              
The definition of “Permitted Investments” is hereby amended by amending and restating clause (19) of such definition
in its entirety as follows:


 






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“(19) Investments in (x) Restricted
Subsidiaries who are not Guarantors and (y) Assertio or any of its Subsidiaries (other than Depo DR) by any Person that is not
Assertio or one of its Subsidiaries in an aggregate amount pursuant to clause (x) and (y) not to exceed $2,500,000 at any one time
outstanding pursuant to this clause (19);”


 


(h)              
The definition of “Restricted Subsidiary” is hereby amended by adding the following additional sentence at the
end thereof:


 


Notwithstanding the foregoing, Depo
DR shall not constitute a “Restricted Subsidiary” of the Issuer.


 


1.4             
Amendment of Section 4.01 of the Indenture. Pursuant to Section 9.02 of the Indenture, Section 4.01(b) of the Indenture
is hereby amended and restated in its entirety as follows:


 


“(b)
On each Payment Date, commencing on November 1, 2020, or on the succeeding Business Day if any such date is not a Business Day
and ceasing upon the payment in full of the outstanding principal balance of the Securities, the Issuer shall pay an amount equal
to 5.00% of the original aggregate principal amount of the Securities. The Issuer shall deliver an Officers’ Certificate
to the Trustee stating the amount of such principal payment at least 10 days prior to the applicable Payment Date.”


 


1.5             
Amendment of Section 4.02(h) of the Indenture. Pursuant to Section 9.02 of the Indenture, Section 4.02(h) of
the Indenture is hereby amended and restated in its entirety as follows:


 


“(h)            Intentionally
omitted.”


 


1.6             
Amendment of Section 4.03 of the Indenture. Pursuant to Section 9.02 of the Indenture, the following paragraph shall
be added immediately after the final paragraph of Section 4.03 of the Indenture:


 


“Notwithstanding
the foregoing or anything herein to the contrary or otherwise, (i) Assertio may at any time have outstanding Assertio Convertible
Debt (or any Indebtedness or Disqualified Stock that serves to refund, refinance or defease such Assertio Convertible Debt); provided
that at all times Assertio has deposited in a blocked control account pledged as collateral in favor of the Trustee for the benefit
of the Holders an amount of cash at least equal to the principal amount of any 2021 Assertio Convertible Notes then outstanding;
provided, further, that Assertio shall be permitted to withdraw the cash in such blocked account only to repay, purchase
or redeem the 2021 Assertio Convertible Notes (whether such redemption is at maturity or pursuant to a tender offer or private
purchase) at a price not in excess of the principal amount thereof plus any accrued and unpaid interest thereon and (ii) Assertio
Convertible Indebtedness (or any Indebtedness or Disqualified Stock that serves to refund, refinance or defease such Assertio Convertible
Debt) may be incurred and outstanding only pursuant to the provisions of this paragraph and not pursuant to any other provision
or basket in Section 4.03(a) and 4.03(b).”


 






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1.7             
Amendment of Section 4.06 of the Indenture. Pursuant to Section 9.02 of the Indenture, Section 4.06(b) of the Indenture
is hereby amended by deleting the reference to “$10,000,000” and inserting in replacement thereof “$5,000,000.”


 


1.8             
Addition of Section 4.18 of the Indenture. Pursuant to Section 9.02 of the Indenture, a new Section 4.18 is added
to the Indenture, with such Section 4.18 reading as follows:


 


“SECTION
4.18.         Depo DR. At all times from and after the Operative Date, the Issuer and its Restricted Subsidiaries shall not direct
any aspect of the operation of Depo DR or permit the amendment, restatement, amendment and restatement, modification, supplement
or waiver of the Royalty Purchase and Sale Agreement (as in effect on the date hereof) in any manner that has the effect of resulting
in the Issuer and its Restricted Subsidiaries directing any aspect of the operation of Depo DR.”


 


1.9             
Amendment of Section 5.01(b) of the Indenture. Pursuant to Section 9.02 of the Indenture, Section 5.01(b) of the
Indenture is hereby amended by adding the following paragraph:


 


“Notwithstanding
the foregoing, (i) neither Assertio nor any of its Subsidiaries may be consolidated, amalgamated, or merged with the Issuer or
any Subsidiary of the Issuer other than Assertio or any of its Subsidiaries (other than Depo DR), and (ii) Depo DR may not be consolidated,
amalgamated or merged with the Issuer or any Subsidiary of the Issuer.”


 


1.10            
Amendment of Section 9.02 of the Indenture. Pursuant to Section 9.02 of the Indenture, Section 9.02(a)(iii) of the
Indenture is hereby amended and restated in its entirety as follows:


 


“(iii) reduce the principal
of any Security or change the Stated Maturity of any Security (or the due date in respect of the payment of any installment of
principal);”


 


1.11           
Amendment of Section 1(d) of the Notes. Pursuant to Section 9.02 of the Indenture, Section 1(d) of the Notes is hereby
amended and restated in its entirety as follows:


 


“(d)        This
Security is one of a series of Securities. On each Payment Date, commencing on November 1, 2020, or on the succeeding Business
Day if any such date is not a Business Day and ceasing upon the payment in full of the outstanding principal balance of the Securities,
the Issuer shall pay an amount equal to 5.00% of the original aggregate principal amount of the Securities. The Issuer shall deliver
an Officers’ Certificate to the Trustee stating the amount of such principal payment at least 10 days prior to the applicable
Payment Date.”


 






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1.12           
Amendment of Section 1 of the Notes. Pursuant to Section 9.02 of the Indenture, the definition of “Applicable
Percentage” set forth in Section 1 of the Notes is hereby deleted.


 


1.13            
Amendment of Section 5 of the Notes. Pursuant to Section 9.02 of the Indenture, the Redemption Price of “103.00%”
for the period from and including January 31, 2020 to and including January 30, 2021 shall be replaced with a Redemption Price
of “100.00%” for such period.


 


1.14            
Assumption by Holdings and Waiver. Holdings hereby expressly assumes the obligations of the Issuer under the Indenture,
the Securities, the Intercreditor Agreements and the Security Documents. Holdings is hereby substituted for, and may exercise every
right and power of, the Issuer under the Indenture with the same effect as if Holdings had been named as the Issuer in the Indenture.
Each Guarantor confirms that its Guarantee shall apply to Holdings’ obligations under the Indenture and the Securities. For
purposes of the Merger, the conditions set forth in Section 5.01(a)(ii) and (iii) of the Indenture shall not be applicable.


 


1.15           
Agreement to Guarantee. The Issuer, Assertio and each other Subsidiary of Holdings signatory hereto that is not a
Guarantor (other than Depo DR) hereby, jointly and severally with the Guarantors, irrevocably and unconditionally guarantees as
a primary obligor and not merely as a surety on a senior basis to each Holder and to the Trustee and its successors and assigns
the Guaranteed Obligations, on the terms and subject to the conditions set forth in Article 10 of the Indenture, and agrees to
be bound by all other applicable provisions of the Indenture and the Securities and to perform all of the obligations and agreements
of a Guarantor under the Indenture.


 


1.16            
Post-Closing Obligations. Notwithstanding anything to the contrary in the Collateral Agreement, the parties to this
Supplemental Indenture hereby agree that (other than with respect to any blocked control account containing funds in an amount
equal to the principal amount of the 2021 Assertio Convertible Notes then outstanding) the Issuer and its Restricted Subsidiaries
shall have a post-closing period of 45 days after the closing of the Merger to enter into any deposit account control agreements
required by the Indenture, the Securities and the Security Documents. In the event that this post-closing obligation has not been
satisfied by the end of the initial 45 day post-closing period, so long as the Issuer certifies in writing to the Trustee that
it has used and is continuing to use commercially reasonable efforts to satisfy such post-closing obligation, such post-closing
period shall be extended for up to two additional 30 day periods.


 






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ARTICLE 2 


 


MISCELLANEOUS
PROVISIONS


 


2.1             
Defined Terms. As used in this Supplemental Indenture, terms defined in the Indenture or in the recitals hereto are
used herein as therein defined, except that the term “Holders” in this Supplemental Indenture shall refer to the term
 “Holders” as defined in the Indenture and the Trustee acting on behalf of and for the benefit of such Holders. The
words “herein”, “hereof” and “hereby” and other words of similar import used in this Supplemental
Indenture refer to this Supplemental Indenture as a whole and not to any particular section hereof.


 


2.2             
Notices. All notices or other communications to Holdings shall be given as provided in Section 12.01 of the Indenture.


 


2.3             
Ratification of Indenture; Supplemental Indenture Part of Indenture. Except as expressly amended hereby, the Indenture
is in all respects ratified and confirmed and all the terms, conditions and provisions thereof shall remain in full force and effect.
This Supplemental Indenture shall form a part of the Indenture for all purposes, and every Holder shall be bound hereby.


 


2.4             
Governing Law. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW (OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL
OBLIGATIONS LAW).


 


2.5             
Trustee Makes No Representation. The Trustee makes no representation as to the validity or sufficiency of this Supplemental
Indenture.


 


2.6             
Counterparts. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be
an original, but all of them together represent the same agreement. The exchange of copies of this Supplemental Indenture and of
signature pages by facsimile or PDF transmission shall constitute effective execution and delivery of this Supplemental Indenture
as to the parties hereto and may be used in lieu of the original Supplemental Indenture for all purposes. Signatures of the parties
hereto transmitted by facsimile or PDF shall be deemed to be their original signatures for all purposes.


 


2.7             
Effect of Headings. The Section headings herein are for convenience of reference only and shall not affect the construction
thereof.


 


2.8             
Reimbursement of Holder Counsel Fees. The Issuer has paid a stay ahead retainer in the amounts agreed to with Paul,
Weiss and Cooley, each as counsel to one or more of the Holders consenting to this Supplemental Indenture. Each of such stay ahead
retainers shall be applied to pay the reasonable invoiced fees and expenses of Paul, Weiss and Cooley, as applicable, from time
to time. Additionally, the Issuer covenants and agrees to pay any amounts in excess of the stay ahead retainer to Paul, Weiss and
Cooley, as applicable, in respect of their reasonable invoiced fees and expenses within thirty (30) days of receipt of such invoices
(or, if earlier, the Operative Date).


 






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IN WITNESS WHEREOF,
the parties hereto have caused this Supplemental Indenture to be duly executed and attested, all as of the date first above written.


 


ZYLA LIFE SCIENCES


 


By: __/s/ Todd N. Smith_______________

Name: Todd N. Smith


Title: President and Chief Executive
Officer


 


ZYLA LIFE SCIENCES US INC.


 


By: __/s/ Todd N. Smith_______________

Name:


Title: Authorized Signatory


 


EGALET LIMITED


 


By: __/s/ Todd N. Smith_______________

Name:


Title: Director


 


ASSERTIO THERAPEUTICS, INC. (F/K/A
DEPOMED INC.)


 


By: __/s/ Todd N. Smith_______________

Name: Todd N. Smith


Title: President and Chief Executive
Officer


 


ASSERTIO HOLDINGS, INC. (F/K/A ALLIGATOR
ZEBRA HOLDINGS, INC.)


 


By: __/s/ Todd N. Smith_______________

Name: Todd N. Smith


Title: President and Chief Executive
Officer


 


[Signature Page – First Supplemental
Indenture]


 



     


     


    

 


ASSERTIO MANAGEMENT, LLC (F/K/A A-TO-Z
MANAGEMENT, LLC)


 


By: __/s/ Todd N. Smith_______________

Name: Todd N. Smith


Title: President and Chief Executive
Officer


 


A-TO-Z DISTRIBUTION, LLC


 


By: __/s/ Todd N. Smith_______________

Name: Todd N. Smith


Title: President and Chief Executive
Officer


 


ALLIGATOR IP, LLC


 


By: __/s/ Todd N. Smith_______________

Name: Todd N. Smith


Title: President and Chief Executive
Officer


 


ZEBRA IP, LLC


 


By: __/s/ Todd N. Smith_______________

Name: Todd N. Smith


Title: President and Chief Executive
Officer


 


DEPO NF SUB, LLC


 


By: __/s/ Todd N. Smith_______________

Name: Todd N. Smith


Title: President and Chief Executive
Officer


 


[Signature Page – First Supplemental
Indenture]


 



     


     


    

 


WILMINGTON SAVINGS FUND SOCIETY, FSB,

as Trustee


 


By: _______________________________

Name:


Title: Authorized Signatory


 


WILMINGTON SAVINGS FUND SOCIETY, FSB,

as Collateral Agent


 


By: _______________________________

Name:


Title: Authorized Signatory


 


[Signature Page – First Supplemental
Indenture]