In this task, you're given a passage that represents a legal contract or clause between multiple parties, followed by a question that needs to be answered. Based on the paragraph, you must write the index where the answer starts. If multiple answers seem to exist, write the index of the answer that is the most plausible. If multiple indices must be used to answer the question, the output should be a common separated list of indices.

Exhibit 10.1 MASTER FRANCHISE AGREEMENT This Master Franchise Agreement (Agreement) is made and entered into on the 20t h day of November, 2018 (the Effective Date) at Mumbai, by and between Smaaash Entertainment Private Limited, an Indian company, with its address at Trade View, Level 2, Kamala Mills, Lower Parel, Mumbai 400013, India (Franchisor) and I-AM Capital Acquisition Company, a company incorporated in the United States of America, with an address at 1345 Avenue of the Americas, 11th floor, New York, 10105 (Franchisee). RECITALS A. WHEREAS, Franchisor operates entertainment centers and gaming arcades throughout India as well as at the Mall of the Americas in Minneapolis Minnesota where Franchisor, through its virtual reality and sports simulation technology and proprietary gamification technologies provides sport and recreational activities/services; and B. WHEREAS, Franchisee is [•] (add the business of the Franchisee); and C. WHEREAS, Franchisor desires to appoint Franchisee, and Franchisee desires to be so appointed, to act as Franchisor's exclusive Franchisee in the territories of North America and South America (Territory) in the manner set out in this Agreement, for setting up, managing and operating entertainment centres and gaming arcades involving virtual reality, sports simulation technology and proprietary gamification technologies to provide sport and recreational activities/services to the public (Smaaash Centres), upon the terms and subject to the conditions hereinafter provided. NOW, THEREFORE, the parties agree as follows: 1. Grant of Franchise 1.1 Rights granted to the Franchisee. Subject to Section 1.2, Franchisor hereby grants to Franchisee the exclusive right, (a) to establish and operate Smaaash Centres in the Territory, (b) to sub-license the right to establish and operate Smaaash Centres to third party franchisees in and for the Territory, (c) a license to use the products and other services developed by Franchisor with respect to the Smaaash Centres (including a right to authorise the use of products and services developed by the Franchisor by third party franchisees), in the Territory, and (d) to identify third party franchisees for the Smaaash Centres in the Territory. The rights granted herein include the limited license to use the Trademarks of the Franchisor (the details of which are morefully set out in Exhibit A), as set out in Section 3 of this Agreement, for the purposes of establishing and operating the Smaaash Centres in the Territory. It is clarified that if third party franchisees shall be establishing and operating Smaaash Centres in the manner contemplated under this Agreement, then the Franchisee shall ensure that such third party franchisees complies with all the obligations and duties of the Franchisee, as recorded under this Agreement, and to this extent, Franchisee may enter into relevant agreements with such third party franchisees. 1.2 Notwithstanding the right granted to the Franchisee in Section 1.1, the Franchisor and its affiliates shall retain the right on the terms and conditions that the Franchisor may deem fit and without granting any rights therein to the Franchisee, (i) to own, acquire, establish and / or operate, and to a grant a license to third parties to establish and operate Smaaash Centres at any location outside the Territory, and (ii) to own, acquire, establish and / or operate, and to grant a license to third parties to establish and operate, gaming and entertainment centres under other proprietary marks or other systems, whether such centres are the same, similar or different from the Smaaash Centres, at any location within or outside the Territory. 1.3 This arrangement has been entered into by the parties on an arms'length basis. All commercials between the parties in relation to the transactions contemplated under this Agreement, if not specifically provided in this Agreement, shall be agreed mutually between the parties. 1.4 Additional Considerations (a) Pricing. Franchisor and Franchisee shall agree upon and decide the locations at which the Smaaash Centres shall be set up within the Territory. The Franchisee shall not be entitled to set up any new Smaaash Centres without consulting with, and obtaining the prior written consent of Smaaash. (b) The prices of the products and services offered in each of the Smaaash Centres shall be decided mutually among the parties. Any revision to the agreed fees, including any discounts or prizes or other promotional measures shall require the prior written consent from Franchisor.

Source: SIMPLICITY ESPORTS & GAMING CO, 8-K, 11/30/2018





(c) Franchisee or the third party franchisee, as the case may be, shall be entitled to receive the revenue generated from each of the Smaaash Centres. If third party franchisees are operating the Smaaash Centres, then the Franchisee shall be entitled to receive, (i) 5% (five percent) of the capital expenditure as agreed among the parties for the particular Smaaash Centre as sign -on fees or upfront advance, and (ii) 5% (five percent) fee or commission of the revenue generated by such third party franchisees from the Smaash Centres on an annual basis. 1.5 Operation of Smaaash Centres. Franchisee or third party sub -franchisees shall be under an obligation to set up at least 6 (six) Smaaash Centres during the first Contract Year or any other time period as may be provided by Franchisor. The Smaaash Centres shall be established and operated in the Territory using the assumed trade name 'Smaaash'or any other trade name that the Franchisor may designate. Franchisee shall maintain good customer relations in accordance with prudent and reasonable business practices. Franchisee shall perform its obligations hereunder without using subcontractors, sub-distributors, independent sales representatives, agents, Franchisee's affiliates or other non-employees (Third Parties) to perform the obligations of Franchisee under this Agreement except to the contrary specifically stated in this Agreement or unless they have been approved, in writing, in advance, by Franchisor, such approval not to be unreasonably withheld. 2. Term The term of this Agreement shall commence as of the Effective Date and shall continue until terminated as hereinafter provided (the Term). Each calendar year during the Term is sometimes hereinafter referred to as a Contract Year. 3. Grant of License in the Trademarks 3.1 License. Subject to the terms of this Agreement (including all obligations to first obtain Franchisor's written approval), Franchisor hereby grants to Franchisee the right to use the Trademarks (the details of which are set out in Exhibit A to this Agreement) (including sub-licensing this right to third party franchisees with the approval of Franchisor), on a royalty-free basis, for the purpose of operating and promoting the Smaaash Centres in the Territory. Franchisee is, in particular entitled to: (a) offer, market and/or distribute any products and services in connection with the Smaaash Centres under the Trademarks; and

Source: SIMPLICITY ESPORTS & GAMING CO, 8-K, 11/30/2018





b) use the Trademarks on business stationery and/or in advertising in connection with the advertising, promotion and distribution of Smaaash Centres in the Territory. 3.2 Exclusivity of License. Except as provided in the next sentence, the license granted herein shall be exclusive. Exclusivity shall mean that Franchisor shall not grant any further licenses to third parties in the Trademarks for use in connection with Smaaash Centres in the Territory, and the Franchisee shall not enter into any arrangement or agreement with any third parties for establishing or operating any gaming and entertainment centres identical or similar to Smaaash Centres, in the Territory except as otherwise provided in this Agreement; provided, however, that Franchisor may continue to use the Trademarks in the Territory in connection with the operation of Franchisor's entertainment centers already set up as of the Effective Date in the Territory. The restriction contained in this Agreement shall apply on the parties throughout the Term. 3.3 Form of Use. Unless otherwise provided herein or agreed by the parties in writing, Franchisee shall use the Trademarks that are registered in the Territory in their registered form. 4. Compliance with Law Franchisee shall ensure that the Smaaash Centres shall be set up, established, operated, managed, advertised, marketed, promoted, publicized and otherwise exploited, in accordance with all applicable laws and regulations in the Territory, including without limitation, all customs requirements and country of origin regulations. 5. Marketing and Promotional Activities 5.1 Best Efforts. (a) Franchisee shall exercise its best efforts to effectively market, promote, and publicise the Smaaash Centres throughout the Territory. Franchisee shall also be obligated to identify suitable locations to set up the Smaaash Centres. Franchisee shall comply with, and ensure that the third party sub-franchisees comply with the standards prescribed by Franchisor (as provided in the operating manuals which shall be shared by Franchisor with Franchisee) with respect to the services, products and operations of the Smaaash Centres and shall operate the Smaaash Centres in strict conformity with such standards and specifications as Franchisor may from time to time prescribe to Franchisee. Franchisee shall refrain from deviating from such standards and specifications without Franchisor's prior written consent and from otherwise operating in any manner which reflects adversely on the Trademarks and Smaaash Centres. (b) Unless otherwise agreed by Franchisor in writing, throughout the Term, Franchisee shall maintain, and shall ensure that the third party sub -franchisees maintain an organizational structure or local management reasonably necessary to adequately support the advertising, marketing and promotion of the Smaaash Centres and the services and products offered by Smaaash Centres throughout the Territory. The third party sub -franchisees shall also be responsible for all employee related compliances as per the relevant applicable laws. Towards this purpose, Franchisee shall appoint a qualified chief operating officer, in consultation with Franchisor, to undertake and manage the obligations of Franchisee as set out in this Agreement. Franchisor shall also be entitled to designate and appoint personnel from its managerial team to assist and train the personnel and staff of the Franchisee or any other third party sub - franchisee in setting up the Smaaash Centres, and further provide technical and design knowledge to the third party sub - franchisees. 5.2 Promotional Material and Products. Franchisee shall submit to Franchisor, for Franchisor's prior written approval, samples of all advertising and promotional materials that Franchisee desires to use to promote Smaaash Centres, including without limitation, print and online advertising designs, trade show display materials, press releases and interviews for publication in any media (Promotional Material). Franchisee shall modify any disapproved Promotional Material to satisfy Franchisor's reasonable objections so that it is acceptable to Franchisor. Franchisor shall provide Franchisee with the creative elements of any Promotional Materials that Franchisor creates or acquires for use in connection with the advertising and sale of Products outside the Territory. 6. Intellectual Property 6.1 Ownership. (a) Franchisor is the sole owner of any and all intellectual property rights relating to the Smaaash Centres and their products and services existing as of the Effective Date, including, but not limited to, the Trademarks and all the goodwill relating thereto (the Franchisor Property). Franchisee, or any third party franchisee, by reason of this Agreement, has not and shall not acquire any right, title, interest or claim of ownership in any of the Franchisor Property in the Territory or elsewhere, except to the extent provided under the license granted under Sections 1 and 3 of this Agreement.

Source: SIMPLICITY ESPORTS & GAMING CO, 8-K, 11/30/2018





(b) Franchisee acknowledges that, (i) Franchisor is the sole and exclusive owner of all right, title and interest in any Franchisor Property; (ii) nothing contained in this Agreement shall give to Franchisee any right, title or interest in any Franchisor Property; and (iii) Franchisee's use of the Franchisor Property, and any associated goodwill, shall inure only to the benefit of Franchisor and shall be deemed to be solely the property of Franchisor should this Agreement be terminated for any reason. 6.2 Registration and Cooperation. Franchisee shall not, directly or indirectly, seek or obtain any new registration for Franchisor Property (including without limitation, any colorable imitations, translations, or transliterations thereof), anywhere in the world without Franchisor's prior written consent. If Franchisee has obtained or obtains in the future, in any country, any right, title or interest in any Franchisor Property notwithstanding the previous sentence (including any colorable imitations, translations, or transliterations thereof), Franchisee will be deemed to have so acted as an agent and for the benefit of Franchisor for the limited purpose of obtaining such registrations and assigning them to Franchisor. Franchisee shall execute, for no additional consideration, any and all documents deemed necessary by Franchisor or its attorneys to be necessary to transfer such right, title or interest to Franchisor. 6.3 No Challenges. Franchisee shall not do anything or suffer anything to be done which may adversely affect any rights of Franchisor in and to any Franchisor Property, or any registrations thereof or which, directly or indirectly, may reduce or dilute the value or distinctiveness of such Franchisor Property, in particular the Trademarks, or disparage or detract from Franchisor's reputation. Franchisee shall not challenge, directly or indirectly, Franchisor's interest in, or the validity of, any Franchisor Property, or any application for registration or trademark registration thereof or any rights of Franchisor therein. The provisions of this Section 6.3 shall survive the termination of this Agreement. 7. Third Party Infringements; Attacks on Use of the Trademarks; Cooperation 7.1 Third Party Infringements. (a) Mutual Information. Each of the parties shall inform the other without undue delay when such party becomes aware of any infringements of any of the Franchisor Property in the Territory. (b) Initiation of Action. Any actions against infringers of any of the Franchisor Property, whether or not such actions involve litigation (including any actions taken to oppose a third party application to register an infringing trademark or a cancellation action against a third party's infringing trademark registration), shall be exclusively reserved to Franchisor, unless otherwise agreed by Franchisor in writing. Notwithstanding the foregoing, Franchisor shall be under no obligation to initiate any such action. If requested by Franchisor, Franchisee shall support Franchisor, at Franchisor's expense, in any such proceedings and, if requested by Franchisor, Franchisee shall promptly provide Franchisor with any relevant documentation in Franchisee's possession. 7.2 Attacks on the Use of the Franchisor Property. Each of the parties shall inform the other if it becomes aware of a claim by a third party that the use of any of any of the Franchisor Property infringes on the rights of such third party. If requested by Franchisor, Franchisee shall support Franchisor, at Franchisor's expense, in connection with Franchisor's defense against any such third party claims. Unless otherwise agreed by Franchisor in writing, Franchisor shall take the lead in any defense against a third party action, whether brought against Franchisor and/or Franchisee. The decision whether or not a defense is appropriate shall be in Franchisor's sole discretion. Franchisee shall not settle any third party claims against it regarding its use of any of the Franchisor Property without the prior written consent of Franchisor. 7.3 Indemnity. The Franchisee shall indemnify and hold the Franchisor, its affiliates and their respective agents and employees harmless from all claims, actions, suits, damages, costs and expenses in relation to or arising out of the breach of any representations, warranties, covenants and obligations of the Franchisee as set out in this Agreement. The indemnification rights of the Franchisor shall be without prejudice to, and independent of any other rights and remedies that the Franchisor may have at law or in equity, including the right to seek specific performance, injunctive relief or restitution, none of which rights or remedies shall be affected or diminished thereby. The provisions of this Section 7.3 shall survive the termination of this Agreement. 8. Termination 8.1 Termination by Mutual Agreement. This Agreement may be terminated at any time upon the mutual written agreement of the parties.

Source: SIMPLICITY ESPORTS & GAMING CO, 8-K, 11/30/2018





8.2 Termination by Franchisor with Notice. Franchisor may terminate this Agreement upon thirty (30) days written notice to Franchisee upon the occurrence of any of the following: (a) Franchisee fails to make any payment required under or in connection with this Agreement; (b) Franchisee ceases to operate or otherwise abandon the Smaaash Centres without the consent of Franchisor, or otherwise forfeit the right to do or transact business in the Territory; (c) Franchisee fails to use its best efforts to market and promote Smaaash Centres and the services and products offered by Smaaash Centres within the Territory and such failure is not cured within thirty (30) days of Franchisor's notification to Franchisee of such failure. 8.3 Termination for Cause. This Agreement may be terminated by either party for Cause without the need of providing a notice period prior to such termination becoming effective. Cause shall exist if circumstances occur which, taking into consideration the substance and purpose of this Agreement, would make it unreasonable for one or both of the parties to continue the contractual relationship and the other party fails to cure the cause (assuming that such cause is susceptible to cure) within thirty (30) days after the date of receipt of a corresponding written notice (Remedy Notice). If such cause by its nature is not curable, then no such Remedy Notice is required. Without limiting the generality of the foregoing, a party may terminate this Agreement for Causeif: (a) the other party to this Agreement is in breach of one or more of its material obligations; or (b) the other party to this Agreement becomes insolvent, generally cannot pay its obligations when due or otherwise suffers a substantial deterioration of its financial situation, or if insolvency/bankruptcy proceedings are initiated against such party or such party initiates any dissolution or liquidation of its business and/or assets. 8.4 Effects of Termination. (a) Upon the termination of this Agreement, any indebtedness of Franchisee to Franchisor shall become immediately due and payable. Franchisee shall immediately cease to operate the Smaaash Centres and shall not thereafter, directly or indirectly, represent to the public or hold itself out as a franchisee of Franchisor. Franchisor shall have the right to suspend the performance of any of their obligations under this Agreement. Franchisor shall have the right to provide the rights and license granted herein to Franchisee to any other third party entity that Franchisor may deem fit. (b) All benefits which may accrue by reason of the activities of Franchisee hereunder shall be deemed transferred automatically to Franchisor, and all licenses and other rights granted to Franchisee hereunder shall immediately cease. Unless otherwise agreed by Franchisor in writing, Franchisee shall immediately discontinue the advertising and marketing of Smaaash Centres and the products and services offered by Smaaash Centres. (c) Each of the parties shall continue to maintain in confidence any and all confidential information received from the other party. At Franchisor's election, Franchisor may purchase from Franchisee any materials used by Franchisee for the advertising, marketing, promotion, publicizing or other exploitation of Smaaash Centres and the products and services offered by the Smaaash Centres, including all Promotional Materials, Franchisor Property, or any other materials which contain any of the Trademarks. (d) The termination of this Agreement for any reason shall not affect obligations accrued prior to the effective date of such termination of this Agreement or any obligations which, either expressly or from the context of this Agreement, are intended to survive the termination of this Agreement. 9. Notices and Other Communications All reports, approvals, requests, demands, notices and other communications (collectively Communications) required or permitted by this Agreement shall be in writing and signed by a duly authorized officer of or such other individual designated in writing by a party. Communications will be duly given if delivered personally, if mailed (by registered mail, return receipt requested) or if delivered by nationally-recognized courier or mail service which requires the addressee to acknowledge, in writing, the receipt thereof, to the party concerned at the following addresses (or at any other address as a party may specify by notice in writing to the other): If to Franchisor: Smaaash Entertainment Private Limited Trade View, Level 2 Kamala Mills Lower Parel, Mumbai 400013, India Attention: Mr. Vishwanath Kotian If to Franchisee: 1345 Avenue of the Americas, 11th floor New York, NY 101015, USA Attention: Mr. Suhel Kanuga

Source: SIMPLICITY ESPORTS & GAMING CO, 8-K, 11/30/2018





10. Miscellaneous 10.1 Entire Agreement. This Agreement contains the entire understanding and agreement between the parties with respect to its subject matter, supersedes all prior oral or written understandings and agreements relating thereto and may not be modified, discharged or terminated, nor may any of the provisions hereof be waived, orally. 10.2 Right to inspect and request information. During the Term, Franchisor shall have the right to conduct audits of Franchisee with respect to the Smaaash Centres, and inspect the Smaaash Centres, after providing a written notice of 5 (five) days. Franchisee shall be under an obligation to provide any information as may be requested by Franchisor with respect to the Smaaash Centres, including the books of accounts and other relevant documents or records maintained in relation to the Smaaash Centres. 10.3 Insurance. During the Term, Franchisee shall maintain policies of insurance as may be requested by Franchisor, subject to applicable law, in relation to the Smaaash Centres. 10.4 Representations and warranties. Each of the parties represents and warrants to the other party that, (i) the Agreement constitutes a valid, legal and binding obligation of such party and is enforceable against such party in accordance with its terms, (ii) it has the power and authority to execute the Agreement and perform all its terms, and (iii) the execution and performance of this Agreement shall not violate any charter documents of such party, contravene any provisions of law as applicable to such party (including any order, decree, injunction of any competent court) or conflict with the provisions of any material agreement or contract executed by such party. The provisions of this Section 10.4 shall survive the termination of this Agreement. 10.5 Governing Law. (a) The parties hereto have expressly agreed that this Agreement shall be governed by, and construed in accordance with, the laws of the State of New York, applicable to contracts executed and fully to be performed therein, to the exclusion of any other applicable body of governing law. (b) Except as hereafter provided, the parties hereby consent to the jurisdiction of the New York State Supreme Court, County of New York or in the United States District Court for the Southern District of New York to resolve any dispute arising under this Agreement. (c) In the event of any litigation or other action arising out of this Agreement, the court shall award to the substantially prevailing party all reasonable costs and expenses including reasonable attorney's fees. 10.6 WAIVER OF JURY. THE PARTIES HEREBY WAIVE ANY RIGHT TO TRIAL BY JURY IN ANY PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED UNDER THIS AGREEMENT, WHETHER NOW OR EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE. THE PARTIES AGREE THAT ANY OF THEM MAY FILE A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE KNOWING, VOLUNTARY AND BARGAINED FOR AGREEMENT AMONG THE PARTIES IRREVOCABLY TO WAIVE THE TRIAL BY JURY COURT, AND THAT ANY PROCEEDINGS WHATSOEVER BETWEEN THEM RELATING TO THIS AGREEMENT SHALL INSTEAD BE TRIED IN A COURT OF COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A JURY. 10.7 Force Majeure. The parties will not be liable to each other for any failure or delay in performance, other than failure to make timely payments due under this Agreement, if it is because of earthquake, flood, fire, acts of God, civil unrest, terrorism, acts of any governmental authority or any other reason beyond the reasonable control of either or both of the parties (Force Majeure). However, either party may terminate this Agreement by and upon notice to the other if the other is unable to perform any of its material obligations for a period of thirty (30) days by reason of a Force Majeure. 10.8 No Joint Venture. Nothing herein is intended to constitute the parties as partners or as joint venturers, or either as agent of the other, and neither party may obligate or bind the other. 10.9 Headings, Definitions and other particulars. Headings and titles of sections and/or paragraphs are for convenience only. The definitions in this Agreement shall apply equally to both the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The use of including in this Agreement shall be construed as illustrative.

Source: SIMPLICITY ESPORTS & GAMING CO, 8-K, 11/30/2018





10.10 Amendment. This Agreement shall, from the Effective Date, bind the parties to the terms herein and cannot be amended without the consent of the parties. Further, this Agreement cannot be terminated by any party except in accordance with Clause 8 of this Agreement. 10.11 Assignment. The Franchisor shall be entitled to assign, transfer, encumber or dispose of any of its rights and or obligations under this Agreement, including to an affiliate, without the prior written consent of the Franchisee. The Franchisee shall not be entitled to assign, transfer, encumber or dispose of any of its rights and or obligations under this Agreement, including to an affiliate, without the prior written consent of the Franchisor. 10.12 Expenses. The Franchisee shall bear all the costs and expenses in relation to the execution of this Agreement and the consummation of all the transactions hereunder. 10.13 Counterparts. This Agreement may be executed in two (2) or more counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same instrument. The delivery of signed counterparts by facsimile transmission or electronic mail in portable document format (.pdf) shall be as effective as signing and delivering the document in person.

Source: SIMPLICITY ESPORTS & GAMING CO, 8-K, 11/30/2018





IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement the day and year first above written. SMAAASH ENTERTAINMENT PRIVATE LIMITED By: /s/ Shripal Morakhia Name: Shripal Morakhia Title: I-AM CAPITAL ACQUISITION COMPANY By: /s/ F. Jacob Cherian Name: F. Jacob Cherian Title: Chief Executive Officer (exhibits follow)

Source: SIMPLICITY ESPORTS & GAMING CO, 8-K, 11/30/2018





Exhibit A Trademarks Separately annexed

Source: SIMPLICITY ESPORTS & GAMING CO, 8-K, 11/30/2018 
Question: Highlight the parts (if any) of this contract related to Covenant Not To Sue that should be reviewed by a lawyer. Details: Is a party restricted from contesting the validity of the counterparty’s ownership of intellectual property or otherwise bringing a claim against the counterparty for matters unrelated to the contract?
14081

Exhibit 10.1



PROMOTION AGREEMENT

by and between

DEPOMED, INC.

and

KING PHARMACEUTICALS, INC.

Dated as of June 27, 2006



Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.







EXECUTION COPY

PROMOTION AGREEMENT

This PROMOTION AGREEMENT (this Agreement) is made as of June 27, 2006 (the Effective Date), by and between Depomed, Inc., a California corporation (Depomed), and King Pharmaceuticals, Inc., a Tennessee corporation (King). Each of Depomed and King is referred to herein individually as a party and collectively as the parties.

WHEREAS, Depomed desires to engage King to promote and market the Product in the Territory (each as defined below), and King desires to promote and market the Product, all in accordance with the terms and conditions contained herein;

NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants herein contained, the parties hereto intending to be legally bound hereby agree as follows:

ARTICLE I

DEFINITIONS

As used in this Agreement, the following terms shall have the following meanings:

Section 1.1 1000mg Formulation has the meaning set forth in Section 6.8(a).

Section 1.2 Act means the United States Federal Food, Drug and Cosmetic Act, 21 U.S.C. 301, et. seq., as it may be amended from time to time, and the regulations promulgated thereunder, including the Generic Drug Act.

Section 1.3 AcuForm Patent License has the meaning set forth in Section 10.1.

Section 1.4 Adverse Drug Experience means any adverse drug experience as defined or contemplated by 21 C.F.R. 314.80 or 312.32, associated with the Product.

Section 1.5 Adverse Drug Experience Report means any oral, written or electronic report of any Adverse Drug Experience transmitted to any Person.

Section 1.6 Advertising/Marketing/Educational Expenses means the direct, out-of-pocket expenses of directly Promoting the Product and conducting Educational Programs with respect to the Product, each clearly identified as such, pursuant to the Launch Plan or an Annual Plan. Advertising/Marketing/Educational Expenses will include (a) King's out-of-pocket costs for Samples incurred as contemplated by Section 6.5, (b) all out-of-pocket costs for Promotional Materials and training materials, and (c) out-of-pocket costs for the purchase of the Prescriber Data. Advertising/Marketing/Educational Expenses will not include (i) any expenses of the King Sales Force or Depomed Sales Force, (ii) any costs incurred by Depomed with respect to the Depomed Sales Force, including as described in Section 4.9(g), or (iii) any costs for the personnel of King or Depomed.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.







Section 1.7 Affiliate means, with respect to any Person, any other Person that directly or indirectly controls, is controlled by or is under common control with, such first Person. For the purposes of this definition, control (including, with correlative meanings, the terms controlling, controlled by and under common control with), as applied to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of that Person, whether through the ownership of voting securities, by contract or otherwise.

Section 1.8 Agreement has the meaning set forth in the preamble to this Agreement.

Section 1.9 Agreement Month means each calendar month during the Term (including any partial calendar month in the case of the first and last calendar months of the Term).

Section 1.10 Agreement Quarter means the Initial Agreement Quarter, each successive period of three months during the Term after the Initial Agreement Quarter and the Final Agreement Quarter.

Section 1.11 Altace Physician List means the list of physicians or other health care practitioners to whom King's sales representatives present in-person, face-to-face sales presentations of King's Altace® product, as such list may be amended from time to time by King.

Section 1.12 Annual Plan has the meaning set forth in Section 4.5.

Section 1.13 Baseline Percentage means the percentage determined by dividing (a) the total amount of unit sales for Product based on prescriptions written by Professionals on the Depomed Physician List during the two complete Agreement Quarters prior to the delivery by Depomed of its intention to commence Promotion of the Product in the Territory pursuant to Section 4.9, by (b) the total amount of unit sales of Product based on all prescriptions written during such two complete Agreement Quarters, based on Prescriber Data for such two complete Agreement Quarters; as it may be amended pursuant to Section 4.9.

Section 1.14 BLS means Biovail Laboratories International SRL.

Section 1.15 BLS Agreements means that certain Amended and Restated License Agreement, dated as of December 13, 2005, by and between Depomed and BLS, the BLS Supply Agreements, and any other agreements between Depomed and BLS with respect to the Product, including the 1000mg Formulation.

Section 1.16 BLS Supply Agreements means that certain Manufacturing Transfer Agreement, dated as of December 13, 2005, by and between Depomed and BLS and that certain Supply Agreement, dated as of December 13, 2005, between Depomed and BLS.

Section 1.17 BLS Fees means, for any period, the sum of (a) [***] for such period, and (b) [***] for such period[***] but [***] such amount is payable (and is paid in or subsequent to such period) [***] In the event the amounts payable under either such agreement are reduced or terminate, the BLS Fees will correspondingly be reduced or terminate.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934. 2







Section 1.18 cGMP shall mean current Good Manufacturing Practices as such term is defined from time to time by the FDA or other relevant Governmental Authority having jurisdiction over the manufacture or sale of the Product pursuant to its regulations, guidelines or otherwise.

Section 1.19 Co-Chairs has the meaning set forth in Section 3.2.

Section 1.20 COGS means, for any period, Depomed's expenses for cost of goods sold (calculated in accordance with Section 7.2(d)) for Product in the Territory for such period, including any expenses incurred directly in connection with the distribution of the Product in the Territory, multiplied by the Promotion Percentage for such period.

Section 1.21 Combination Product has the meaning set forth in Section 13.2.

Section 1.22 Combination Product License has the meaning set forth in Section 13.1(a).

Section 1.23 Confidentiality Agreement means that certain Confidentiality Agreement, dated as of February 21, 2006, between Depomed and King.

Section 1.24 Control or Controlled means, with respect to patents, know-how or other intellectual property rights of any kind, the possession by a party of the ability to grant a license or sublicense of such rights without the payment of additional consideration and without violating the terms of any agreement or arrangement between such party and any Third Party.

Section 1.25 DDMAC means the FDA's Division of Drug Marketing, Advertising and Communications.

Section 1.26 Depomed has the meaning set forth in the preamble to this Agreement.

Section 1.27 Depomed Net Sales means, for a particular period, Net Sales for such Period, multiplied by the Depomed Percentage for such period.

Section 1.28 Depomed Percentage means, for a particular period, the difference of (a) the percentage determined by dividing (i) the total amount of unit sales for Product based on prescriptions written during such period by Professionals on the Depomed Physician List, by (ii) the total amount of unit sales of Product based on all prescriptions written during such period, in each case based on Prescriber Data for the applicable period; minus (b) the Baseline Percentage; provided that the Depomed Percentage shall not be less than zero.

Section 1.29 Depomed Physician List means the list of Professionals to whom the Depomed Sales Force may present Details, as such list may be amended from time to time as contemplated by this Agreement; provided that the list must conform to the requirements of Section 4.9.

Section 1.30 Depomed Promotional Materials has the meaning set forth in Section 4.9(f).

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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Section 1.31 Depomed Sales Force means the field force of Sales Representatives employed or contracted by Depomed.

Section 1.32 Depomed Supply Failure means (a) with respect to the 500mg formulation of the Product, Depomed's failure to fill orders from its wholesalers and distributors for the 500mg formulation of the Product equal to or in excess of (i) [***] percent of the aggregate amount of 500mg formulation of the Product ordered during any period of three consecutive Agreement Months that does not exceed the then-current Volume Forecast for such period, or (ii) [***] percent of the amount of 500mg formulation of the Product ordered for three consecutive Agreement Months that does not exceed the then-current Volume Forecast for such period; and (b) with respect to the 1000mg Formulation, Depomed's failure to fill orders from its wholesalers and distributors for the 1000mg Formulation equal to or in excess of (i) [***] percent of the aggregate amount of 1000mg Formulation ordered during any period of six consecutive Agreement Months that does not exceed the then-current Volume Forecast for such period, or (ii) [***] percent of the amount of 1000mg Formulation ordered for twelve consecutive Agreement Months that does not exceed the then- current Volume Forecast for such period; provided, in each case, that (x) any back-up manufacturing rights in favor of Depomed pursuant to any exclusive supply arrangement relating to the applicable formulation of the Product are applicable as a result of such supply failure, and (y) Depomed is not diligently exercising such back-up manufacturing rights.

Section 1.33 Depomed Trademarks means (a) the GlumetzaTM trademark, for which Depomed's licensor has sought registration for in the United States Patent and Trademark Office, (b) the AcuFormTM trademark, for which Depomed has sought registration for in the United States Patent and Trademark Office, and (c) Depomed®, and, in each case, all related domain names and other trademark related rights. The Depomed Trademarks are attached hereto as Schedule 1.33.

Section 1.34 Detail means an in-person, face-to-face sales presentation of the Product made by a Sales Representative to a Professional, including a P1 Detail, P2 Detail, or P3 Detail.

Section 1.35 Educational Programs means any activities undertaken with respect to the medical education of Professionals and customers regarding the Product and the market or funded by unrestricted educational grants, including educational programs and seminars and continuing medical education materials.

Section 1.36 Effective Date has the meaning set forth in the preamble to this Agreement.

Section 1.37 Evaluation Period has the meaning set forth in Section 13.2.

Section 1.38 Executive Officers means the Chief Operating Officer of Depomed (or, if there is no such officer, its President or Chief Executive Officer) and the Chief Commercial Officer of King (or, if there is no such officer, its President or Chief Executive Officer).

Section 1.39 FDA means the United States Food and Drug Administration or any successor agency performing comparable functions in the Territory.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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Section 1.40 Final Agreement Quarter means the period commencing on the first day following the last full Agreement Quarter during the Term and ending on the last day of the Term.

Section 1.41 Force Majeure Event has the meaning set forth in Section 16.6.

Section 1.42 GAAP has the meaning set forth in Section 7.2(c).

Section 1.43 Generic Drug Act has the meaning set forth in Section 9.1(j).

Section 1.44 Governmental Authority shall mean any court, agency, authority, department, regulatory body or other instrumentality of any government or country or of any national, federal, state, provincial, regional, county, city or other political subdivision of any such government or any supranational organization of which any such country is a member, which has competent and binding authority to decide, mandate, regulate, enforce, or otherwise control the activities of the parties contemplated by this Agreement.

Section 1.45 Gross Margin means, for a particular period, (A) Promotion Net Sales for such period minus (B) all BLS Fees and COGS for such period.

Section 1.46 Initial Agreement Quarter means the period commencing on the Effective Date and ending on September 30, 2006.

Section 1.47 JAMS has the meaning set forth in Section 3.5(b).

Section 1.48 JCC has the meaning set forth in Section 3.1.

Section 1.49 King has the meaning set forth in the Preamble to this Agreement.

Section 1.50 King CCC means King's Copy Clearance Committee.

Section 1.51 King Manufacturing Notice has the meaning set forth in Section 6.6.

Section 1.52 King Physician List means the list of Professionals to whom the King Sales Force presents Details agreed to in writing prior to the Effective Date, as such list may be amended from time to time as part of the Annual Plan or in accordance with Section 4.1(d).

Section 1.53 King Sales Force means the field force of Sales Representatives employed or contracted by King.

Section 1.54 King Trademarks means the trademarks set forth on Schedule 1.54, including the King Pharmaceuticals trademark and associated design

Section 1.55 Launch Period means the period beginning on the Effective Date and ending on December 31, 2006.

Section 1.56 Launch Plan means the plan and schedule for the commercial launch of the Product in the Territory during the Launch Period, including the parties' responsibilities for the activities associated with such commercial launch of the Product, a budget for the activities

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

5







to be undertaken in connection with such commercial launch (taking into account Advertising/Marketing/Educational Expenses incurred by Depomed prior to the Effective Date), and the parties' responsibilities for the payment of such budgeted expenses. The initial Launch Plan describing a summary of the plan and schedule for commercial launch is attached hereto as Schedule 1.56, which plan will be amended by the JCC in accordance with Section 4.5.

Section 1.57 Launch Promotional Materials has the meaning set forth in Section 4.4(c).

Section 1.58 Legal Requirements means laws, rules and regulations of any Governmental Authority.

Section 1.59 Metformin Product Rights has the meaning set forth in Section 13.2.

Section 1.60 Minimum Sales Force Level has the meaning set forth in Section 4.3(a).

Section 1.61 NDA means any new drug application (as such term is used under the Act) filed or acquired by Depomed or any Affiliate with the FDA with respect to the Product and all subsequent submissions, supplements and amendments thereto, including NDA No. 21-748 filed with the FDA on April 27, 2004 (as such NDA may be amended or supplemented subsequent to the Effective Date).

Section 1.62 Negotiation Period has the meaning set forth in Section 13.2.

Section 1.63 Net Sales means, for any period, the actual gross amount invoiced on sales of Product in the Territory by Depomed, its Affiliates, licensees, sublicensees and assigns to independent, unrelated Third Parties during such period in bona fide arms' length transactions, less the following deductions, so long as they conform with the requirements of Section 6.4, allowed and taken by Third Parties and not otherwise recovered by or reimbursed to Depomed, its Affiliates, licensees, sublicensees or assigns: (a) freight, insurance (but only insurance with respect to shipping the Product), and other transportation charges to the extent added to the sales price and set forth separately as such on the total amount invoiced; (b) any sales, use, value-added, excise taxes or duties or allowances on the selling price of Product which fall due and are paid as a consequence of such sale; (c) chargebacks, trade, quantity and cash discounts and rebates to the extent customary in the trade, including governmental rebates, in each case, accrued in accordance with GAAP; and (d) allowances or credits, including allowances or credits to customers on account of rejection, defects or returns of the Product or because of a retroactive price reduction, actually taken by customers that are customary in the trade. Net Sales shall not include (a) a sale or transfer to an Affiliate, licensee, sublicensee or assign of King or Depomed or if done for clinical, regulatory or governmental purposes where no consideration is received; but the resale by such Affiliate, licensee, sublicensee or assign of King or Depomed shall be considered a sale of such Product; or (b) a sale to a wholesaler or distributor during the Launch Period in connection with the initial stocking of the Product with respect to which (x) the invoice relating to such sale has not been paid as of the date on which a report setting forth Net Sales for such period is due pursuant to this Agreement, and (y) the wholesaler or distributor has the right to return the Product as of the date on which a report setting forth Net Sales for such period is due pursuant to this Agreement.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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Section 1.64 Order means any award, decision, injunction, judgment, decree, order, ruling, or verdict entered, issued, made, or rendered by any Governmental Authority or by any arbitrator.

Section 1.65 P1 Detail means a Detail where the Product is the first item presented and comprises more than one-half of the presentation time.

Section 1.66 P2 Detail means a Detail where the Product is the second item presented and comprises at least one-third of the presentation time.

Section 1.67 P3 Detail means a Detail where the Product is not the first item presented and comprises at least 15% of the presentation time.

Section 1.68 PDE means a Primary Detail Equivalent, and is equivalent to any of the following: (a) one P1 Detail; (b) two P2 Details; or (c) five P3 Details. Details other than P1 Details, P2 Details and P3 Details will have no effect on any calculation of PDEs.

Section 1.69 PDE Cost means $[***] per PDE.

Section 1.70 PDE Minimum has the meaning set forth in Section 8.2(a)(i).

Section 1.71 PDE Shortfall has the meaning set forth in Section 8.2(a)(i).

Section 1.72 PDMA means the Prescription Drug Marketing Act, as amended, and the rules and regulations promulgated thereunder.

Section 1.73 Person means any individual, corporation (including any non-profit corporation), general or limited partnership, limited liability company, joint venture, estate, trust, association, organization, labor union, or other entity or Governmental Authority.

Section 1.74 Prescriber Data means data provided by a Third Party which measures prescriptions filled for Product (by individual prescriber) in the Territory during a specified time period, from a source mutually agreed in writing by the parties (it being understood that IMS Health Incorporated is a source agreeable to the parties).

Section 1.75 Product means any once-daily oral tablet formulation containing metformin as the sole active pharmaceutical ingredient, including the 1000mg Formulation.

Section 1.76 Product Complaints means any report concerning the quality, purity, quantity, weight, pharmacologic activity, labeling, identity or appearance of the Product.

Section 1.77 Professional means a physician or other health care practitioner who is permitted by law to prescribe Product.

Section 1.78 Promote, Promotional and Promotion mean, with respect to the Product, any activities undertaken to encourage sales or use of the Product, including Details, product sampling, detail aids, drop-offs, coupons, discount cards, journal advertising, direct mail

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

7







programs, direct-to-consumer advertising, convention exhibits and all other forms of marketing, advertising, public relations or promotion.

Section 1.79 Promotion Commencement Date has the meaning set forth in Section 4.1(c).

Section 1.80 Promotion Fees has the meaning set forth in Section 7.1(a).

Section 1.81 Promotion Net Sales means Net Sales multiplied by the Promotion Percentage.

Section 1.82 Promotion Percentage means, for a particular period, 100% minus the Depomed Percentage for such period, if any Depomed Net Sales occur in such period.

Section 1.83 Promotional Effort has the meaning set forth in Section 4.1(a).

Section 1.84 Promotional Materials has the meaning set forth in Section 4.4(a).

Section 1.85 Proprietary Information means any proprietary or confidential information communicated from one party to the other in connection or relating to this Agreement, which is identified as confidential or proprietary, or which the other party knows or has reason to know is confidential or proprietary, including the Technology and financial, marketing, business, technical and scientific information or data, information related to King's compensation of its Sales Representatives, information contained within the Annual Plan and Launch Plan, and the information described in Section 4.6, whether communicated in writing, orally or electronically. Proprietary Information shall not include information that the receiving party can show through written documentation:

(a) at the time of disclosure, is publicly known;

(b) after the time of disclosure, becomes part of the public domain, except by breach of an agreement between the disclosing party or any Affiliate thereof and the receiving party or any Affiliate thereof;

(c) is or was in the possession of the receiving party or any Affiliate thereof at the time of disclosure by the disclosing party and was not acquired directly or indirectly from the disclosing party or any Affiliate thereof or from any other party under an agreement of confidentiality to the disclosing party or any Affiliate thereof; and

(d) is or was developed by the receiving party or its Affiliates without use of or reference to the other party's Proprietary Information.

Section 1.86 Reconciliation Report has the meaning set forth in Section 7.5(d).

Section 1.87 Regulatory Approval means any and all consents or other authorizations or approvals required from a Governmental Authority to market and sell the Product in the Territory, but excluding any form of reimbursement approval.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

8







Section 1.88 Safety Stock has the meaning defined in Section 6.1

Section 1.89 Sales Representatives means sales representatives employed by King or Depomed, or a Third Party engaged by King or Depomed, to Promote the Product, who have been trained and equipped to Promote the Product in accordance with this Agreement. In the case of King, Third Parties may only be engaged as Sales Representatives if they are full-time contractors of King, exclusive to King, and carry King's business card.

Section 1.90 Samples has the meaning set forth in Section 6.5.

Section 1.91 Serious Adverse Drug Experience means any Adverse Drug Experience, including those subject to expedited reporting as defined in the regulations cited below, that is fatal or life-threatening, requires hospitalization or prolongation of existing hospitalization, results in persistent or significant disability or incapacity, is a congenital anomaly/birth defect, or is of comparable medical significance or any other event which would constitute a serious Adverse Drug Experience pursuant to the terms of 21 C.F.R. 314.80 or 312.32.

Section 1.92 Serious Adverse Drug Experience Report means any Adverse Drug Experience Report that involves a Serious Adverse Drug Experience.

Section 1.93 Standard Cost means, (a) with respect to COGS, the cost assigned from time to time, but at least annually, by Depomed to use in calculating Gross Margin under Section 7.1(a) for the purpose of facilitating timely reporting of Gross Margin; and, (b) with respect to Samples, the cost assigned from time to time, but at least annually, by Depomed to use in calculating Advertising/Marketing/Educational Expenses pursuant to Section 4.5(e); each determined in accordance with Section 7.2(e).

Section 1.94 Subcontracting means subcontracting or sublicensing a party's rights or obligations hereunder (a) pursuant to which a Third Party will manufacture the Product; or (b) pursuant to which a Third Party Sales Representative is engaged to Promote the Product. Subcontractor means the Third Party with whom the Subcontracting agreement is entered into.

Section 1.95 Technology means all pharmacological, toxicological, preclinical, clinical, technical or other information, data and analysis and know-how relating to the registration, manufacture, packaging, use, marketing and sale of the Product and all proprietary rights relating thereto owned by Depomed or its Affiliates or to which Depomed or its Affiliates has rights so as to be able to license, and relating or pertaining to the Product.

Section 1.96 Term has the meaning set forth in Section 8.1.

Section 1.97 Territory means the United States, including its possessions and Puerto Rico.

Section 1.98 Third Party means any Person other than King or Depomed or their respective Affiliates.

Section 1.99 Unit means a single tablet of the Product.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

9







Section 1.100 United States Bankruptcy Code shall mean the U.S. Bankruptcy Code, 11 U.S.C. §§ 101, et seq.

Section 1.101 Volume Forecast has the meaning set forth in Section 6.3.

ARTICLE II

GRANT

Section 2.1 Grant of Promotion Rights. During the Term, subject to the terms and conditions of this Agreement, Depomed hereby grants to King and its Affiliates and King and its Affiliates hereby accept a co-exclusive right to Promote the Product under the Depomed Trademarks in the Territory together with Depomed and its Affiliates only, on the terms and subject to the conditions set forth herein. Depomed agrees that its and its Affiliates' right to Promote the Product is limited to the rights set forth in Section 4.9.

Section 2.2 Sublicense. Except pursuant to Section 16.9 or in connection with the use of Third Party Sales Representatives, King shall not assign, subcontract or otherwise transfer or delegate any of its rights or obligations under this Agreement without the express written consent of Depomed, which consent may be withheld by Depomed in its sole discretion.

Section 2.3 Limitation on Metformin Promotion. Except as expressly contemplated by this Agreement (including Article XIII hereof) and subject to Section 13.1 hereof, King shall not promote, market or distribute any product containing metformin hydrochloride as the sole active ingredient in the Territory during the Term of this Agreement, other than the Product.

Section 2.4 Retention of Rights. Depomed retains and shall retain all proprietary and property interests in the Product until the point of sale or, in the case of Samples, until delivered to King as contemplated by Section 6.5. King will not have nor represent that it has any control or proprietary or property interests in the Product, except for the licenses and rights specifically granted hereunder. Except as expressly set forth herein, nothing contained herein shall be deemed to grant King, by implication, a license or other right or interest in any patent, trademark or other similar property of Depomed or its Affiliates, except as may be necessary for King to Promote the Product pursuant to this Agreement or to manufacture the Product in accordance with Section 6.6. Except as expressly set forth herein, nothing contained herein shall be deemed to grant Depomed, by implication, a license or other right or interest in any patent, trademark or other similar property of King or its Affiliates, except as may be necessary for Depomed to Promote the Product pursuant to this Agreement.

ARTICLE III

JOINT COMMERCIALIZATION COMMITTEE

Section 3.1 Establishment. The parties agree to establish, for the purposes specified herein, a Joint Commercialization Committee (the JCC). The parties acknowledge and agree that the JCC does not have the power to amend, modify or waive any of the terms or conditions of this Agreement.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

10







Section 3.2 Joint Commercialization Committee. The JCC shall be established by the parties and shall be comprised of eight members, four of whom shall be appointed by Depomed and four of whom shall be appointed by King. Each party's respective initial appointments to the JCC are set forth on Schedule 3.2 hereto. A party may change any of its representatives at any time if a new person is appointed to any of the foregoing positions by giving written notice to the other party. The total number of JCC members may be changed by unanimous vote of the JCC from time to time as appropriate; provided, that the JCC shall in all cases be comprised of an equal number of members from each of Depomed and King. King and Depomed each will designate one representative of such party to serve as co-chairs of the JCC (the Co- Chairs). The members appointed to the JCC by each party shall be employees of such party and shall be vested with appropriate decision-making authority and power by such party. The Chief Executive Officers of King and Depomed, the Chief Operating Officer of Depomed, and the Chief Commercial Officer of King shall not be members of the JCC.

Section 3.3 JCC Responsibilities. Except as otherwise set forth herein, the JCC shall direct all Promotional and marketing activities for the Product hereunder. The responsibilities of the JCC shall be exercised consistent with this Agreement and shall include, but shall not be limited to:

(a) reviewing and approving modifications to the Launch Plan (provided that no such modification may increase or reduce the Advertising/Marketing/Educational Expenses allocated to the parties under the Launch Plan, or modify any call plan or sampling plan set forth in the Launch Plan, without both parties' written approval).

(b) reviewing and approving the Annual Plan as contemplated by Section 4.5, including developing the Advertising/Marketing/Educational Expenses associated with the Promotion activities under the Annual Plan;

(c) monitoring and reviewing compliance with the Annual Plan and the Launch Plan;

(d) reviewing and approving any modifications to the Annual Plan to address market or Product-related issues and opportunities (provided that, without the written approval of both parties, such modifications do not (i) result in a decrease of more than 10% of the annual budget set forth in the Annual Plan, or (ii) result in an increase of more than 5% of the Advertising/Marketing/Educational Expenses allocated to either party under the Annual Plan);

(e) developing Product Promotion strategies and objectives, including Product positioning, messaging and branding, and reviewing and approving all material communications to Third Parties related to commercial matters for the purpose of Promoting the Product;

(f) monitoring the Depomed Sales Force call plan for coordination with the King Sales Force;

(g) monitoring advertising placement and market responses, including any post-implementation reviews;

(h) reviewing and approving any Volume Forecasts and Sample forecasts;

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

11







(i) establishing pricing for the Product, including the timing of any pricing changes;

(j) reviewing, but not approving, sales incentive compensation for the King Sales Force related to the Product;

(k) establishing contracting guidelines for the distribution of the Product;

(l) overseeing the coordination of the parties' efforts in respect of managed care marketing strategies;

(m) proposing any new packaging design for the Product (subject to Depomed's approval, and followed by and subject to applicable FDA and other Legal Requirements);

(n) reviewing and approving reductions to the King Physician List (provided that, without the approval of both parties, (i) the King Physician List may not be reduced prior to the second anniversary of the Promotion Commencement Date, and (ii) the number of Professionals on the King Physician List may not be decreased such that the number of Professionals on the King Physician List is less than [***]% of the number of Professionals on the King Physician List as of the Effective Date); and

(o) such other functions as may be mutually agreed upon by the parties from time to time.

For the avoidance of doubt, (i) the JCC shall not have any review or approval rights with respect to any matters relating to the development of the Product and (ii) any decisions of the JCC with respect to matters which relate to Regulatory Approval for the Product shall require Depomed's prior written consent.

Section 3.4 Meetings of the JCC. Meetings of the JCC may be called by the Co-Chairs of the JCC from time to time and, upon no less than five days' notice, shall otherwise be called when requested by a party; provided, however, that meetings of the JCC shall be held on at least a monthly basis during the first six months of the Term, and on at least a quarterly basis thereafter. If possible, the meetings shall be held in person or where appropriate, by video or telephone conference. Unless otherwise agreed, the location of any in-person meetings of the JCC shall alternate between the corporate offices of the parties. The parties shall determine the form of the meetings. Subject to Section 3.5, decisions shall be made unanimously, each party having one (1) vote regardless of the number of representatives present or voting; provided, that no such vote shall be valid unless each party is represented by at least two members either by written proxy or actual presence at the meeting at which the vote is taken. Subject to appropriate confidentiality undertakings where applicable, each party shall have the right, upon written notice to the other party, to have present at JCC meetings additional, non-voting participants (not to exceed ten such participants at any JCC meeting without the consent of the other party). Such additional participants shall not be deemed to be, or have any rights or responsibilities of, a member of the JCC. The parties shall cause their respective representatives on the JCC to use their reasonable efforts to resolve all matters presented to them as expeditiously as possible. The party hosting any meeting shall propose the agenda for the meeting and appoint a secretary to the meeting who shall record the minutes of the meeting. Such minutes shall be circulated to the parties promptly following the meeting for review and comment and for unanimous ratification

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

12







by both parties. Each party shall bear its own travel and related costs incurred in connection with participation in the JCC.

Section 3.5 JCC Disputes.

(a) In the event that the JCC is, after a period of ten days, unable to make a decision due to a lack of required unanimity, either party may submit the matter being considered to the Executive Officers for a joint decision. In such event, either Co-Chair of the JCC, by written notice to the other party, shall formally request the dispute be resolved by the Executive Officers, specifying the nature of the dispute with sufficient detail to permit adequate consideration by the Executive Officers. The Executive Officers shall diligently and in good faith attempt to resolve the referred dispute expeditiously and, in any event, within fifteen days of receiving such written notification.

(b) In the event that the Executive Officers are unable to reach a resolution of any referred dispute after good faith negotiations during the fifteen-day period referred to in Section 3.5(a) above and in the event such dispute is not related to compliance with this Agreement, regulatory matters, or the validity, breach or interpretation of this Agreement, either party may commence mediation within fifteen days after the conclusion of such fifteen-day period by providing to the other party a written request for non-binding mediation, setting forth the subject of the dispute and the relief requested (a Mediation Notice). The parties will cooperate with Judicial Arbitration and Mediation Services (JAMS) and with one another in selecting a mediator from JAMS' panel of neutrals, and in scheduling the mediation proceedings. The parties shall endeavor to conclude any mediation under this Section 3.5 within thirty days after delivery by either party of Mediation Notice. The parties covenant that they will participate in the mediation in good faith and that they will share equally in its costs; provided that each party will be responsible for its own attorney's fees. Either party may seek equitable relief prior to the mediation to preserve the status quo pending the completion of that process. Except for such an action to obtain equitable relief, neither party may commence a civil action with respect to the matters submitted to mediation until after the completion of the initial mediation session, or thirty days after delivery of the Mediation Notice, whichever occurs first.

(c) Any disputes referred to the Executive Officers for resolution pursuant to this Section 3.5 shall not be subject to any dispute resolution mechanism or procedure other than pursuant to this Section 3.5.

ARTICLE IV

PRODUCT PROMOTION

Section 4.1 Product Promotion.

(a) Subject to applicable Legal Requirements, as well as the provisions of this Agreement, King shall, from and after the Promotion Commencement Date, at its sole expense, use commercially reasonable efforts to Promote the Product within the Territory in accordance with the Launch Plan or Annual Plan (the Promotional Effort). For purposes of the preceding sentence, King's commercially reasonable efforts shall mean, until [***], at least the same

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

13







degree of effort (including with respect to the reach and frequency of Details) that King would use for the Promotion of any of King's products that are promoted in the [***], are of a similar market size and patent life, and represent a similar commercial opportunity; thereafter, King will apply the same standard, except that it may fulfill its obligations by Promoting the Product in the [***]. All statements, core selling messages and materials to be utilized by King to Promote the Product shall be consistent in all material respects with the Annual Plan and the Launch Plan. King will cause the King Sales Force and King employees and agents acting on King's behalf to comply with this Agreement and all applicable Legal Requirements in connection with the Promotion of the Product. It is understood, and King agrees, that it will be accountable for the acts or omissions of the King Sales Force and its employees and agents to the extent such acts or omissions fail to comply with King's obligations under this Agreement.

(b) From and after the Promotion Commencement Date, King shall perform at least [***] PDEs per calendar year, with such amount prorated over the initial and final calendar years of the Term if either such year is a partial year. In fulfilling its obligations under this Section 4.1(b), King will perform [***], as follows: King will perform no less than an average of [***], with such reach and frequency as the JCC determines as part of the Annual Plan each year. The determination of the [***] will be based on [***] used by King with respect to [***]; provided that the [***] by King will be [***] will be deemed the [***] Notwithstanding the foregoing, the parties acknowledge and agree that during the first month following the Commencement Date, King will be building its Promotional Efforts.

(c) King shall commence (the date of such commencement, the Promotion Commencement Date) Promotion (including Details by the King Sales Force) of the Product in accordance with this Agreement and the performance of the other obligations contained herein that are required to be performed from and after the Promotion Commencement Date as soon as practicable following the date hereof, but no later than September 5, 2006, or as soon thereafter as the Product (including Samples) is available in commercial quantities reasonably adequate to support the commercial launch of the Product in the Territory. The parties agree to cooperate with each other in good faith in furtherance of the preceding sentence.

(d) Any Professional on the King Physician List who does not receive [***] Detail prior to the end of the Launch Period will be removed from the King Physician List at the end of the Launch Period. From time to time, King may Promote the Product to Professionals who are not on the King Physician List or the Depomed Physician List. At such time as King conducts [***] Details to any such Professional during a six-month period, such Professional will automatically be added to the King Physician List.

Section 4.2 Representations to Customers. King will not make any false or misleading representations to Professionals, customers or others regarding Depomed or the Product and will not make any representations, warranties or guarantees with respect to the specifications, features or capabilities of the Product that are not consistent with the applicable then-current FDA approved labeling, package insert or other documentation accompanying or describing the Product, including Depomed's standard limited warranty and disclaimers. King agrees to undertake timely and complete corrective action for any deviations from this Section 4.2, subject to discussion and review by Depomed's regulatory affairs and quality assurance department.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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Section 4.3 Staffing; Training.

(a) King agrees that from and after the Promotion Commencement Date, the King Sales Force will be staffed with at least [***] full-time Sales Representatives (subject to vacancies consistent with average vacancy rate experienced by King across its total sales force) who are actively promoting the Product in accordance with the Launch Plan or Annual Plan (the Minimum Sales Force Level); provided that King may meet such requirement to actively promote the Product by promoting the Product through P2 Details and P3 Details. Throughout the remainder of the Term, King shall use its commercially reasonable efforts to ensure that the number of Sales Representatives comprising the King Sales Force meets or exceeds the Minimum Sales Force Level, including by promptly filling all vacant positions in the King Sales Force resulting from resignations or terminations.

(b) King shall be solely responsible for all costs and expenses of compensating its Sales Representatives. Consistent with applicable Legal Requirements, King shall pay incentive compensation to its Sales Representatives with respect to the Product in accordance with King's incentive compensation plan for King's own products; it being understood that, (i) through [***], King shall determine the target incentive payment for the Product in a manner consistent with the way in which King determines the target incentive payment for pharmaceutical drug products that are promoted in the [***], are of a similar market size and patent life, and represent a similar commercial opportunity; and (ii) thereafter, King shall determine the target incentive payment for the Product in a manner consistent with the way in which King determines the target incentive payment for pharmaceutical drug products promoted by King that are of a similar market size and patent life, and represent a similar commercial opportunity. King shall notify its Sales Representatives prior to the Promotion Commencement Date, or coinciding with the launch of the Product and consistent with its procedures for King's other products, of the total potential incentive compensation for the Product. Promptly after the adoption by King of an incentive compensation payment plan with respect to the Product pursuant to this Agreement and any material amendments thereto, King shall provide to Depomed [***] for the Product pursuant to such plan.

(c) Depomed shall make available to King any training materials created by Depomed prior to the Effective Date at Depomed's out-of-pocket cost for such materials. In consultation with Depomed, King shall develop, [***], training materials for its Sales Representatives in other media or forms provided that such materials shall be subject to Depomed's review as Promotional Materials as provided in Section 4.4. King shall, at its own expense prior to the Promotion Commencement Date, train its Sales Representatives using such training materials, the other Promotional Materials and such programs as King shall deem appropriate that are in compliance with King's obligations hereunder and all other Legal Requirements and that have been approved by the JCC. Such programs shall include training with respect to reporting Adverse Drug Experiences and technical complaints. After the initial training, King shall periodically provide additional training to each of its Sales Representative, and shall update its training materials as appropriate in connection with such additional training, in accordance with this Section 4.3.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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Section 4.4 Promotional Materials; Educational Materials.

(a) Subject to Sections 4.4(b), 4.4(c) and 4.9, King shall, [***], create, develop, produce or otherwise obtain, and utilize sales, promotional, advertising, marketing, educational and training materials (Promotional Materials) which are necessary to support fully the Promotional Effort for the Product. Such Promotional Materials may include, by way of example, detailing aids; leave items; journal advertising; educational programs; formulary binders; appropriate reprints and reprint carriers; product monographs; patient support kits; convention exhibit materials; direct mail; market research survey and analysis; training materials; and scripts for telemarketing and teleconferences. All Promotional Materials used by the King Sales Force or bearing the King Trademarks will be subject to the review and approval of the King CCC. All Promotional Materials developed by King hereunder shall prominently display such Depomed Trademark(s) as shall be specified by Depomed to King following its review of the applicable prototype in accordance with Section 4.4(b).

(b) Prior to the use thereof, King shall provide to Depomed a prototype of any Promotional Materials created by King for review. Depomed shall notify King of any objections it has to such prototype and the basis therefor as soon as reasonably practicable, but no later than ten business days following its receipt thereof (five business days during the Launch Period). King shall modify such Promotional Materials to the extent necessary to resolve any objections made by Depomed to such Promotional Materials on the grounds that such Promotional Materials are inconsistent with any Legal Requirements or this Agreement and shall in good faith consider and address any of Depomed's other objections. The final version of the Promotional Materials approved by the King CCC shall be provided to Depomed for its review and approval to confirm their consistency with the prototype approved by Depomed and the resolution of Depomed's objections in accordance with this Section 4.4(b), which review and approval shall occur, as soon as reasonably practicable, but no later than ten business days (five business days during the Launch Period) following its receipt by Depomed. Upon approval, the Promotional Materials may be produced in quantity, and King shall provide Depomed with the requisite number of copies of the final printed form in a timely manner so as to allow Depomed to satisfy its obligation to file such materials with the FDA prior to the first use of the Promotional Materials, and Depomed will make such filing with the FDA within five business days of its receipt of such copies.

(c) Notwithstanding the provisions of Section 4.4(a), Depomed shall maintain responsibility for the creation and development of Promotional Materials to be utilized in connection with the commercial launch of the Product (the Launch Promotional Materials). Depomed shall provide to King prototypes of all Launch Promotional Materials for the review and approval of the King CCC. King shall notify Depomed of any objections it has to such prototype and the basis therefor within five business days following its receipt thereof. Depomed shall modify such Promotional Materials to the extent necessary to resolve any objections made by King to such Promotional Materials on the grounds that such Promotional Materials are inconsistent with any Legal Requirements or this Agreement, and shall in good faith consider and endeavor to resolve and address any of King's other objections. The final version of the Launch Promotional Materials shall be provided to King for the review and approval of the King CCC to confirm their consistency with the prototype approved by King and the resolution of King's objections in accordance with this Section 4.4(c), which review and

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

16







approval shall occur, as soon as reasonably practicable, but no later than five business days following its receipt by Depomed. On or prior to the Promotion Commencement Date, Depomed shall deliver to King all King-approved Launch Promotional Materials created by Depomed in its inventory, less a reasonable amount thereof necessary to support Promotion efforts undertaken by Depomed. The Launch Promotional Materials supplied to King under this Section 4.4(c) shall be delivered to a single location specified by King in writing prior to such delivery. Depomed hereby grants to King the non-exclusive right, during the Term, to use the Launch Promotional Materials supplied to King pursuant to this Section 4.4(c) in the performance of its obligations under this Agreement.

(d) Depomed shall own all copyrights to all Promotional Materials that are created during the Term of this Agreement in connection with the Promotion of the Product. King shall use commercially reasonable efforts consistent with accepted business practices to obtain such assignments from the authors and creators of such materials as may be necessary to vest ownership of the copyright in Depomed. Depomed shall, and does hereby, grant to King a royalty-free license to use and reproduce such materials solely in conjunction with its Promotion of the Product pursuant to this Agreement, which license shall not be assignable or transferable by King, except in accordance with the terms of Section 2.2.

(e) All written materials relating to Educational Programs that are funded using Advertising/Marketing/Educational Expenses shall identify both Depomed and King as sponsors of such Educational Programs, unless otherwise agreed by the JCC.

Section 4.5 Launch Plan; Annual Plan; Promotion Expenses.

(a) The JCC shall use all reasonable efforts to refine the Launch Plan prior to the Promotion Commencement Date in order to set forth in detail the parties' responsibilities during the Launch Period, incorporating the components of an Annual Plan set forth in Section 4.5(b) below.

(b) On or prior to September 1 of the preceding calendar year with respect to each calendar year during the Term beginning with the 2007 calendar year, King shall develop an annual commercialization plan (the Annual Plan) and submit the Annual Plan to the JCC for review and approval; provided that the Annual Plan for the 2007 calendar year will be developed on or prior to December 1, 2006. The Annual Plan shall set forth the manner in which the Product is to be Promoted and commercialized during the period to which the Annual Plan relates and shall include, at a minimum:

(i) the anticipated number of quarterly and annual Details (including P1 Details, P2 Details and P3 Details) to be provided by the King Sales Force;

(ii) the King Physician List;

(iii) Product positioning, strategy and tactics with supporting advertising and promotional activity to be undertaken, including all material communications to Third Parties related to commercial matters for the purpose of Promoting the Product;

(iv) any training and/or sampling programs to be conducted;

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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(v) medical education programs to be conducted;

(vi) planned public relations activities;

(vii) Product production forecasts;

(viii) Sample forecasts and delivery schedules;

(ix) pricing and contracting strategies;

(x) format and quantity of sales, marketing and educational materials;

(xi) managed health care strategies and tactics;

(xii) customer targets;

(xiii) Product manufacturing and distribution;

(xiv) post-marketing clinical studies that Depomed, in its sole discretion, decides to conduct; and

(xv) a detailed, itemized budget for all costs and expenses associated with the activities to be undertaken pursuant to the Annual Plan (including all Advertising/Marketing/Educational Expenses), and the allocation of such costs and expenses between the parties.

(c) The JCC shall use all reasonable efforts to approve the Annual Plan not later than November 1 of each preceding calendar year; provided that the Annual Plan for the 2007 calendar year will be approved no later than January 1, 2007. The Annual Plan for 2007 shall incorporate tasks, activities and responsibilities in addition to any tasks, activities and responsibilities in the Launch Plan. The JCC shall endeavor to ensure the parties there are no tasks, activities or responsibilities in the Launch Plan inconsistent with those set forth in the Annual Plan for 2007.

(d) Each party shall use its commercially reasonable efforts to perform all tasks, responsibilities and activities for which it is responsible under the Launch Plan and the Annual Plan. Neither party shall have any obligation to incur Advertising/Marketing/Educational Expenses in excess of those set forth in the Annual Plan; provided, that King shall be responsible for any and all costs and expenses associated with creating and approving any new Product packaging design proposed by King (and such costs and expenses shall be in addition to King's Advertising/Marketing/Educational Expenses). Furthermore, except to the extent the JCC has approved any payment in accordance with this Agreement, including approval as part of an Annual Plan, or except for a party's obligation to pay its portion of the Advertising/Marketing/Educational Expenses described in Section 4.5(e) below, neither party shall (i) be obligated to incur any costs or expend any funds that have not been approved by such party or (ii) have the authority to cause the other party to incur any costs or expend any funds that have not been approved by such other party.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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(e) All Advertising/Marketing/Educational Expenses incurred by a party on and after the Effective Date (and such expenses incurred prior to the Effective Date as are specifically set forth in the Launch Plan attached hereto as Schedule 1.56) shall be allocated between the parties according to the following percentages: [***]% will be allocated to King and [***]% will be allocated to Depomed; provided that the first $[***] of Advertising/Marketing/Educational Expenses set forth in the Launch Plan is allocated to, and shall be paid by, Depomed and the next $[***] of Advertising/Marketing/Educational Expenses set forth in the Launch Plan is allocated to, and shall be paid by, King. Without the prior written consent of each party, the aggregate Advertising/Marketing/Educational Expenses to be incurred by the parties each calendar year during the Term shall be as set forth on Schedule 4.5. With the prior written consent of each party, the JCC may increase or decrease the Advertising/Marketing/Educational Expenses above those amounts set forth on such schedule.

(f) Each party will bear its own operating expenses associated with the Product and Promotion thereof, including all personnel, general and administrative and overhead costs. King will bear all King Sales Force expenses, and Depomed will bear all Depomed Sales Force expenses. Depomed will bear all costs associated with maintaining and continuing all Regulatory Approvals of the Product in the Territory, including all costs associated with Adverse Drug Experience reporting and all clinical and regulatory requirements.

Section 4.6 King Promotion Reports. Within thirty (30) days following the end of each Agreement Quarter, King shall provide the JCC with a status report, which report will summarize King's Promotional activities pursuant to this Agreement for such prior Agreement Quarter and on a calendar year-to-date basis, including, to the extent King customarily creates the following reports for King's other products which are promoted by or on behalf of King: (a) the number of P1, P2 and P3 Details made and recorded by King's standard record keeping procedures; (b) the names and addresses of the Professionals called upon; (c) the percentage of Professionals Detailed who were provided with Samples; (d) the average number of such Samples delivered on each Detail; (e) a breakdown of all information required to be contained in each report on an aggregate basis; (f) any Professionals added to the King Physician List during such quarter; and (g) such other information as may be required in the then- current Annual Plan.

Section 4.7 Medical Inquiries. The parties acknowledge that each may receive requests for medical information concerning the Product from members of the medical and paramedical professions and consumers regarding the Product. If such requests come from a Professional on the King Physician List or are otherwise received by King, the request will be handled by King's medical department. The King medical department will submit all form letters to the Depomed's development department for approval prior to use. King will comply with direction provided by Depomed as to the content of any such letters or communications. Depomed shall be responsible for responding to such requests that do not come from Professionals on the King Physician List or are not otherwise received by King, which responses shall be in compliance with all applicable Legal Requirements and the NDA. The parties shall use the same form of letter or communication for all such responses to Professionals and consumers. Each party shall promptly provide the other party with (i) copies of all written materials and (ii) written summaries of all oral advice, provided by such party in response to such inquiries.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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Section 4.8 Trademarks.

(a) The Depomed trademark must appear on all Promotional Material that makes reference to the Product. The AcuForm trademark must appear on all Promotional Materials that make reference to the AcuForm drug delivery technology incorporated into the Product. Depomed hereby grants to King a non-assignable, non- sublicensable, non-exclusive, royalty-free right and license to use the Depomed Trademarks in the Territory solely in connection with King's Promotion of the Product in accordance with this Agreement; provided King may assign and sublicense such right and license in accordance with Section 2.2. Such license shall expire immediately upon the expiration or termination of this Agreement. Subject to this Section 4.8 and to applicable Legal Requirements, King shall have the right to use the King Trademarks, and include the name King or any variation thereof on the Promotional Materials developed by King; provided, that such King Trademarks shall not appear in such Promotional Materials in greater prominence or in greater frequency than the Depomed Trademark(s). In addition, the JCC will discuss including the King Trademarks, in equal prominence to the Depomed Trademarks and in accordance with all Legal Requirements, on all packaging for Samples distributed by the King Sales Force, with determination as to including such marks being based on the timing for implementing such change and the costs associated therewith, with all costs associated with creating and approving new packaging borne by King in accordance with Section 4.5(d). King recognizes Depomed's title to the Depomed Trademarks, and shall not at any time, during or after the Term, do or knowingly suffer to be done any act or thing which will in any way impair the rights of Depomed in or to the Depomed Trademarks. King acknowledges and agrees that it shall not acquire and shall not claim any title to the Depomed Trademarks adverse to Depomed by virtue of the rights granted under this Agreement or through King's use of the Depomed Trademarks, it being the intention of the parties that all goodwill and improved reputation generated by King and use of the Depomed Trademarks shall inure to the benefit of Depomed.

(b) King hereby grants to Depomed a non-assignable, non-sublicensable (except to any Third Party acting as the Depomed Sales Force), non-exclusive, royalty-free right and license to use the King Trademarks in the Territory solely in connection with Depomed's Promotion of the Product. Such license shall expire immediately upon the expiration or termination of this Agreement. Subject to this Section 4.8 and to applicable Legal Requirements, Depomed shall have the right to use Depomed Trademarks, and include the name Depomed, AcuForm, or any variation thereof on the Promotional Materials developed by Depomed in accordance with this Agreement. Depomed recognizes King's title to the King Trademarks, and shall not at any time, during or after the Term, do or knowingly suffer to be done any act or thing which will in any way impair the rights of King in or to the King Trademarks. Depomed shall not be obligated to use the King Trademarks in the Depomed Promotional Materials. Depomed acknowledges and agrees that it shall not acquire and shall not claim any title to the King Trademarks adverse to King by virtue of the rights granted under this Agreement or through Depomed's use of the King Trademarks, it being the intention of the parties that all goodwill and improved reputation generated by Depomed and use of the King Trademarks shall inure to the benefit of King.

(c) Each of King with respect to its use of the Depomed Trademarks and Depomed with respect to its use of the King Trademarks will maintain quality standards for all of its uses

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

20







of the trademarks of the other party in connection with the Promotion of the Product that are substantially equivalent to those standards used by the owner of such trademarks in connection with pharmaceutical products. Subject to the foregoing and to the other provisions of this Agreement, each party acknowledges and agrees that the owner or licensee of the trademark has the right, at any time, to modify or supplement such quality standards and that the licensee or sublicensee must implement such new standards or changes following receipt of notice of such additions or changes; provided that the licensor agrees to bear all reasonable costs associated with such modifications and supplements. Compliance with this Section 4.8(c) shall be determined pursuant to the Promotional Material and Depomed Promotional Materials review and approval procedures set forth in Sections 4.4(b) and 4.9(e), as applicable.

Section 4.9 Promotion by Depomed.

(a) At Depomed's option, it may, but is not obligated to, have the Depomed Sales Force Promote the Product directly to Professionals who are (i) not on the King Physician List or (ii) are on the King Physician List but did not receive at least [***] Details in the four most complete Agreement Quarters following the Promotion Commencement Date (or, if Depomed desires to commence Details prior to March 31, 2008, at least [***] Details during the two Agreement Quarters on which the Baseline Percentage is determined). If Depomed desires to use the Depomed Sales Force for this purpose, it will inform King at least 90 days in advance of the commencement of Details by the Depomed Sales Force and provide King with the Depomed Physician List. During such 90-day period, King will be entitled to review the Depomed Physician List and confirm that such list does not contain any Professionals that are not, as of the date of King's receipt of the Depomed Physician List, eligible for inclusion on the Depomed Physician List. Following creation of the initial Depomed Physician List, from time to time but not more than two times per calendar year, Depomed may add Professionals to the Depomed Physician List pursuant to the procedure set forth above, so long as Depomed has conducted at least [***] Details to such Professional during the six-month period immediately prior to being added. Following the addition of such Professionals to the Depomed Physician List, the Baseline Percentage shall be adjusted to reflect prescriptions written by any such Professionals by adding to the then-current Baseline Percentage the quotient obtained by dividing (x) [***] prior to Depomed's commencement of providing Details to such Professionals, by (y) [***], based on Prescriber Data for such two complete Agreement Quarters.

(b) Depomed will submit to the JCC a call plan setting forth the Details to be performed by the Depomed Sales Force. Such call plan may be taken into account in developing the Annual Plan. Any Professional on the Depomed Physician List who does not receive at least [***] Details in each full calendar year following the commencement of Promotion of the Product by the Depomed Sales Force will be excluded from the Depomed Physician List in subsequent calendar years for purposes of calculating Depomed Net Sales, and for purposes of calculating the Baseline Percentage.

(c) During any period in which the Depomed Sales Force is making Details, efforts will be made at the local level to coordinate the Details by the Depomed Sales Force with Details by the King Sales Force to ensure the most effective coverage of the target audiences and to minimize non-productive efforts. Depomed will provide the JCC with such information related to Depomed's promotion activities as is reasonably necessary to assist in such efforts.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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(d) All Details made by the Depomed Sales Force will be reported to King. Such reports by Depomed will be made in the same manner as King's Details under Section 4.6 (to the extent Depomed customarily creates such reports for Depomed's other products which are promoted by or on behalf of Depomed).

(e) Depomed may purchase from King, [***], copies of any Promotional Materials created by King for use by the Depomed Sales Force. Upon Depomed's request, King will provide to Depomed electronic copies of Promotional Materials created by or for King, which Promotional Materials may be modified for use by Depomed; provided that any modification must be approved in the same manner as approval of Depomed Promotional Materials (as defined below). King [***] for such Promotional Materials. Depomed may also create and develop its own Promotional Materials for use by the Depomed Sales Force (Depomed Promotional Materials). Prior to the use thereof, Depomed shall provide to the JCC a prototype of any Depomed Promotional Materials. The JCC may review such prototype for consistency with Legal Requirements and the Product positioning and messaging reflected in the then-current Annual Plan. If the JCC notifies Depomed within 10 business days after receipt of a prototype that is objects to such prototype on the grounds that it is inconsistent with the Product positioning and messaging reflected in the then current Annual Plan, Depomed shall modify such Depomed Promotional Materials to the extent necessary to resolve any objections made by the JCC to such Depomed Promotional Materials on such grounds. In addition, Depomed shall in good faith consider any other objections the JCC may have to any Depomed Promotional Materials. The Depomed Promotional Materials will not contain any King Trademark unless such materials are subject to the review and approval of the King CCC. King may purchase from Depomed, [***], copies of any Depomed Promotional Materials. Upon King's request, Depomed will provide to King electronic copies of Depomed Promotional Materials created by or for Depomed, which Depomed Promotional Materials may be modified for use by King; provided that any modification must be approved in the same manner as approval of Promotional Materials.

(f) Depomed may purchase from King, [***], copies of training materials developed by King related to the Product for use by Depomed in the training of the Depomed Sales Force. Depomed shall be responsible for training of the Depomed Sales Force, and may, at its own expense, develop training materials for the Depomed Sales Force in other media or forms, provided that such materials shall be subject to King's review as Depomed Promotional Materials as provided in Section 4.9(e). Depomed shall, at its own expense, train the Depomed Sales Force using such training materials, the other Promotional Materials and Depomed Training Materials and such programs as Depomed shall deem appropriate that are in compliance with Depomed's obligations hereunder. Such programs shall include training with respect to reporting Adverse Drug Experiences and technical complaints. After the initial training, Depomed shall periodically provide additional training to each Sales Representative, and shall update its training materials as appropriate in connection with such additional training, in accordance with this Section 4.9(f).

(g) [***] Depomed's costs or expenses related to any activities of the Depomed Sales Force, including costs for Depomed Promotional Materials, training or training materials or the purchase from King of Promotional Materials for the Depomed Sales Force, will be included in Advertising/Marketing/Educational Expenses or be reimbursable by King.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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(h) It is understood, and Depomed agrees, that it will be accountable for the acts or omissions of its employees and agents to the extent such acts or omissions fail to comply with Depomed's obligations under this Agreement.

ARTICLE V

CLINICAL AND REGULATORY AFFAIRS; DEVELOPMENT

Section 5.1 Regulatory Approvals. Depomed shall use commercially reasonable efforts to maintain and continue all Regulatory Approvals currently in effect for the Product. King agrees that all Regulatory Approvals, applications therefor and any other submissions to a Governmental Authority with respect to the Product shall be in the name of, and shall be owned by, Depomed or its designee.

Section 5.2 Compliance with Regulatory Requirements. Unless otherwise required by law or expressly required by this Agreement, Depomed will retain exclusive authority over and responsibility for complying with all regulatory requirements and maintaining all contacts with Governmental Authorities with respect to the Product, including maintaining and updating of the NDA, the development and submission of applications for new indications, the reporting of any adverse drug reactions to the FDA, the compliance of Promotional Materials with FDA rules and regulations and the filing of Promotional Materials with the FDA.

Section 5.3 Compliance. In performing its duties hereunder, each party shall, and shall cause the King Sales Force or Depomed Sales Force, as applicable, and its employees and agents to, comply with all Legal Requirements, including the FDA's regulations and guidelines concerning the advertising of prescription drug products, DDMAC's promotional guidelines, the Department of Health and Human Services Office of the Inspector General Compliance Program Guidance for Pharmaceutical Manufacturers, the American Medical Association's Guidelines on Gifts to Physicians, the PhRMA Code on Interactions with Healthcare Providers, the Prescription Drug Marketing Act of 1987, as amended, and the rules and regulations promulgated thereunder, the ACCME Standards for Commercial Support of Continuing Medical Education, equal employment, non-discrimination and federal and state anti-kickback Legal Requirements, Legal Requirements with respect to submission of false claims to governmental or private health care payors, and all industry and professional standards, which may be applicable to the activities (including the warehousing, handling and distribution of Samples) to be performed by such party hereunder. None of King, Depomed, the King Sales Force, the Depomed Sales Force and either party's employees and agents shall offer, pay, solicit or receive any remuneration to or from Professionals in order to induce referrals of or purchase of the Product. The King Sales Force and the Depomed Sales Force shall have no direct contact with, nor shall the King Sales Force or the Depomed Sales Force be involved with the delivery of Product to patients, other than delivery of Samples directly to Professionals authorized to prescribe the Product. The King Sales Force and the Depomed Sales Force shall be trained in connection with compliance with Sec. 1128B(b) of the Social Security Act and the AMA Guidelines on Gifts to Physicians from Industry prior to engaging in Promotion of the Product.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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Section 5.4 Communications with Regulatory Authorities.

(a) All communications with Government Authorities concerning the Product shall be the sole responsibility of Depomed. Depomed shall within two business days provide King with copies of all such communications (including summaries of all relevant verbal communications) related to Promotional Materials and Serious Adverse Drug Experiences (except that routine communications as to such matters (e.g., FDA 2253 correspondence) may be forwarded to King within 5 business days). Depomed will consult with King concerning adverse drug reaction reporting to the FDA that Depomed reasonably considers to be significant to the Product, including regulatory responses to follow up inquiries regarding adverse drug reactions. Depomed will provide to King a copy of all draft responses related to such matters as soon as practicable, and will endeavor to provide them at least five business days in advance of their submission (to the extent allowable under Legal Requirements), and will consider in good faith any comments provided to Depomed by King.

(b) King shall not, without the consent of Depomed or unless so required by Legal Requirements (and then only pursuant to the terms of this Section 5.4, unless this Section 5.4 is inconsistent with Legal Requirements), correspond or communicate with the FDA or with any other Governmental Authority, whether within the Territory or otherwise, concerning the Product, or otherwise take any action concerning any Regulatory Approval under which the Product is sold or any application for Regulatory Approval of the Product; provided that during the Term, King shall have the right to communicate with the FDA or any other Governmental Authority regarding the Product if such communication is necessary to comply with the terms of this Agreement or any Legal Requirement, or if King made a request of such agency to communicate with Depomed instead, and such Governmental Authority denied such request (in any such case, King shall give Depomed notice as soon as reasonably practicable of such communication and, to the extent practicable, Depomed shall be permitted to accompany King, take part in any such communications and receive copies of all such communications). King shall, immediately upon receipt of any communication from the FDA or from any other Governmental Authority relating to the Product, forward a copy of the same to Depomed and respond to all inquiries by Depomed relating thereto. If King is required by law to communicate with the FDA or with any other Governmental Authority relating to the Product, then King shall so advise Depomed immediately (within one business day) and provide Depomed in advance with a copy of any proposed written communication, or a written summary of any proposed oral communication with the FDA or any other Governmental Authority. King shall comply with any and all reasonable direction of Depomed concerning any meeting or written or oral communication with the FDA or any other Governmental Authority relating to the Product unless otherwise required by Legal Requirements.

Section 5.5 Product Complaints. King shall refer any oral or written Product Complaints which it receives concerning the Product to Depomed within four calendar days of its receipt thereof; provided, that all complaints concerning suspected or actual Product tampering, contamination or mix-up shall be delivered within twenty-four hours of its receipt thereof. King shall not take any other action in respect of any such complaint without the consent of Depomed unless otherwise required by Legal Requirements. If requested by Depomed, King will collaborate with Depomed to resolve any Product Complaints. All Product Complaints shall be directed to the attention of Depomed's Vice President, Regulatory Affairs, at

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

24







Depomed's address set forth in Section 14.1. Depomed shall provide King with a summary of all Product Complaints received by Depomed within ten business days of its receipt thereof.

Section 5.6 Adverse Drug Experience Reports.

(a) Each party shall notify the other: (i) of all Serious Adverse Drug Experience Reports within forty-eight (48) hours of the time such Serious Adverse Drug Experience Report becomes known to such party (including its employees); and (ii) of all Adverse Drug Experience Reports within five (5) calendar days of the time such Adverse Drug Experience Report becomes known to such party (including its employees).

(b) Except as may otherwise be required by Legal Requirements, (i) King shall not disclose any information concerning Adverse Drug Experience Reports or Serious Adverse Drug Experience Reports to any Person or Governmental Authority without the prior consent of Depomed; and (ii) Depomed shall have the sole discretion to determine whether any Product Complaint, Adverse Drug Experience Report or Serious Adverse Drug Experience Report must be reported to the FDA or any other Governmental Authority.

(c) All follow-up investigations concerning Adverse Drug Experience Reports and Serious Adverse Drug Experience Reports shall be conducted by Depomed; provided that King shall have the right to participate in such investigations upon its request. King shall provide all reasonable cooperation with any such follow-up investigation as may be requested by Depomed from time to time.

Section 5.7 Recalls or Other Corrective Action. Depomed shall have sole responsibility for and shall make all decisions with respect to any recall (including recall of packaging and promotion materials), market withdrawals or any other corrective action related to the Product. Depomed shall promptly notify King of any such actions taken by Depomed, including all actions that are reasonably likely to result in a material adverse effect on the marketability of the Product in the Territory. At Depomed's request, King shall provide assistance to Depomed in conducting such recall, market withdrawal or other corrective action (including retrieving Samples distributed by the King Sales Force to Professionals). With respect to any recall, market withdrawal or corrective action initiated by Depomed as a result of Depomed becoming aware of any manufacturing defect in Product (other than Product manufactured by King in accordance with Section 6.6), Depomed shall reimburse King for its reasonable, documented, direct, out-of-pocket costs incurred in connection with participating in such recall, market withdrawal or other corrective action provided that King's breach of its obligations hereunder is not a material cause of the recall, market withdrawal or other corrective action. Except as set forth above, Depomed shall be under no liability whatsoever to compensate King or make any other payment to King for any decision to recall, initiate a market withdrawal or take any other corrective action with respect to the Product.

Section 5.8 Assistance. Each party agrees to provide to the other all reasonable assistance and take all actions reasonably requested by the other party that are necessary to enable the other party to comply with any Legal Requirement applicable to the Product.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

25







ARTICLE VI

MANUFACTURING AND SUPPLY; SALES; PRICING; 1000MG FORMULATION

Section 6.1 Obligations of Depomed. In accordance with the provisions of this Agreement and all applicable Legal Requirements, Depomed shall, at its cost and expense, use reasonable best efforts to perform or cause to be performed all Product manufacture, labeling, packaging, warehousing, distribution and return, order entry, customer services and all other activities to supply and distribute the Product in the Territory in order to fill orders for Product conforming to the then-current Volume Forecast in a timely and efficient manner. From and after the completion of the sixth full calendar month following the Promotion Commencement Date, Depomed shall use commercially reasonable efforts to maintain at least one month's safety stock of Product (Safety Stock) to address unanticipated changes in demand for the Product (calculated on the basis of the Volume Forecast contained in the then-current Annual Plan).

Section 6.2 Manufacturing Activities. The Product, including all Samples, to be manufactured by or for Depomed for sale in the Territory shall be manufactured to meet applicable specifications for the Product in accordance with the NDA, cGMP and in compliance with all other applicable Legal Requirements.

Section 6.3 Volume Forecasts. At least 30 days prior to the beginning of each Agreement Quarter ending after the Promotion Commencement Date, King shall submit to the JCC a written forecast by month of the number of Units of Product expected to be sold in the Territory during the twelve (12) month period beginning with such Agreement Quarter, which forecast shall be prepared by King in good faith. In order to assist King in developing such forecasts, Depomed shall give King trade wholesaler stocking levels information within ten days following the beginning of each Agreement Quarter ending after the Promotion Commencement Date (or, if later, within two business days after such information becomes available to Depomed). The JCC shall review and discuss such forecast and shall make such modifications thereto as may be necessary for such forecast to be unanimously approved by the JCC and to be consistent with the forecasting and purchasing provisions of Depomed's Third Party supply agreement relating to the Product (as so modified and approved for the applicable twelve (12) month period, the Volume Forecast). Depomed shall use reasonable best efforts to manufacture and distribute, or cause to be manufactured and distributed, Product consistent with the Volume Forecast. The Volume Forecast for the twelve month period beginning on August 1, 2006 is attached hereto as Schedule 6.3.

Section 6.4 Sales; Pricing.

(a) Depomed or its Affiliates shall book all sales of the Product in the Territory and shall be responsible for entering into any contracts and other arrangements with any Person regarding the sale of the Product, and for establishing and approving the form, content and terms and conditions thereof, including any discount, allowance, rebate, chargeback or other term granted therein; provided, however, that (i) the pricing of the Product shall be consistent with the pricing established by the JCC in accordance with Section 3.3 hereof, (ii) the terms of such contract and other arrangement shall be consistent with the contracting guidelines established by the JCC in accordance with Section 3.3(k) and reflected in the Annual Plan, and (iii) any

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

26







deductions from gross amounts invoiced pursuant to any such contract or arrangement shall correspond to one or more of the categories of deductions set forth in the definition of Net Sales in Article I. The parties have reviewed the initial pricing and contracting guidelines applicable to the Product. The parties agree to discuss among the JCC and finalize the initial pricing and contracting guidelines within two weeks after the Effective Date.

(b) King will work on behalf of Depomed to provide necessary support for managed markets and trade customer groups with respect to the Product to enable Depomed to enter into such contracts and other arrangements described above. For purposes of clarity, all such contracts and arrangements supported by King must be executed and administered by Depomed.

Section 6.5 Samples.

(a) Depomed shall provide or cause to be provided to King, from time to time as contemplated by the Annual Plan, with samples of the Product that are not for sale and with no fee associated (Samples) to be distributed by King solely in connection with the performance of Details. Depomed shall supply such Samples FOB Depomed's or its designee's warehouse, and the risk of loss and responsibility for handling and warehousing of the Samples shall pass to King upon delivery to a carrier designated by King. King shall be responsible for distributing the Samples to its Sales Representatives in a timely manner. Depomed shall invoice King for each shipment of Samples at its Standard Cost payable within 30 days of the invoice date. King shall also be responsible for securing the return and appropriate disposal of and reconciling existing Sample inventories from discontinued Sales Representatives.

(b) Samples supplied by Depomed to King shall be used by King solely in performing Details to Professionals in accordance with this Agreement. Upon its receipt of Samples, King shall be solely responsible for accountability and compliance with the PDMA for the King Sales Force, and other applicable Legal Requirements relating to such Samples or the distribution of same by the King Sales Force, and shall be responsible for adherence by its Sales Representatives to such Legal Requirements.

(c) Sampling volume shall be consistent with King's Promotional Effort and considered a component of the Advertising/Marketing/Educational Expenses. Sampling volume will be included as a part of each Annual Plan.

Section 6.6 Inability to Supply. In the event that a Depomed Supply Failure occurs, notwithstanding its compliance with its obligations under Section 6.1, to fulfill all orders for the Product generated by King activities in a timely and efficient manner, upon written notice to Depomed (a King Manufacturing Notice), King shall have, and hereby grants King, exercisable only in accordance with the provisions hereof, the right, but not the obligation, to manufacture, or have manufactured, the Product on behalf of Depomed, at Depomed's expense, including expenses related to the technical transfer of the Product, and Depomed will provide reasonable assistance to King in connection therewith, including by transferring or licensing to King all Technology necessary or useful to give King the capability of manufacturing the Product so that King can undertake manufacture of the Product; provided, however, that Depomed shall not be required to reimburse King for more than [***] percent ([***]%) of Depomed's standard cost for such Product. Any such Product manufactured by King will be

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

27







sold by Depomed in accordance with this Agreement. King's right to use the Technology to manufacture, or have manufactured, the Product under this Section 6.6 shall terminate upon the later to occur of (a) the second (2nd) anniversary of the date upon which King delivered the King Manufacturing Notice to Depomed and (b) the six (6) month anniversary of the date upon which Depomed shall have delivered to King a certification of its CEO as to Depomed's ability to fulfill all orders for the Product generated by King activities in a timely and efficient manner, but in any event on termination of this Agreement.

Section 6.7 Manufacture by King. Depomed agrees to consider in good faith any proposal by King to manufacture the 500mg formulation of the Product at King's Bristol facility that would result in a reduction in the supply price applicable to the Product relative to Depomed's then current contract manufacturer, and would be suitable to Depomed's operations, regulatory affairs, and quality assurance groups. Any fixed and determinable savings in Product manufacturing cost to Depomed realized during the Term, and during the eight calendar quarters during which a payment is being paid pursuant to Section 7.4, that results from any definitive long-term supply arrangement between Depomed and King relating to the Product relative to Depomed's then current long-term supply arrangement [***]; provided that, in the event King continues to manufacture the Product for Depomed, the parties will negotiate in good faith with respect to adjusting the pricing mechanism for the manufacture of such Product following the Term, and such eight calendar quarter period, in order to compensate King for such savings and for any discounts King provided to Depomed as a result of the relationship of the parties hereunder. Any manufacture by King of the Product would be subject to regulatory approval of a supplemental NDA providing for such manufacture.

Section 6.8 1000mg Formulation.

(a) The parties acknowledge that Depomed will use commercially reasonable efforts to submit a supplemental new drug application to the FDA and to obtain Regulatory Approval for a 1000mg formulation using metformin as the sole active pharmaceutical ingredient (the 1000mg Formulation) to which Depomed has certain rights pursuant to the BLS Supply Agreements.

(b) The provisions of Section 6.1 through 6.6 will not apply to the 1000mg Formulation unless and until Depomed obtains Regulatory Approval for the 1000mg Formulation, at which time such provisions will apply, except as follows: (i) Depomed shall have no obligation to continue to supply and distribute the 1000mg Formulation if Depomed, in the exercise of its reasonable business judgment after consultation with the JCC, determines that marketing the 1000mg Formulation in the Territory is not commercially feasible due to reasons related to intellectual property matters, safety, FDA, manufacturing or supply issues, or market conditions; and (ii) Depomed shall have no liability under this Agreement for any failure by BLS to timely deliver and supply the 1000mg Formulation under the BLS Supply Agreement in accordance with the terms thereof, and any such failure on the part of BLS shall not be a breach or default of this Agreement by Depomed (except to the extent that any such failure by BLS arises directly from Depomed's failure to comply with its obligations, including paying amounts due, under such agreement).

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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Section 6.9 BLS Supply Agreements. The parties acknowledge that Depomed is subject to certain obligations under the BLS Supply Agreements. Depomed shall not amend, terminate or cause to be terminated any BLS Supply Agreement (or any other agreement between Depomed and BLS concerning rights to, or the supply or marketing of, the Product in the Territory) without the prior written consent of King, which consent shall not to be unreasonably withheld, delayed or conditioned; provided that Depomed shall have the right to amend any BLS Agreement without the consent of King if such amendment does not materially and adversely affect (a) Depomed's ability to maintain Regulatory Approval for the 1000mg Formulation, (b) Depomed's ability to purchase the 1000mg Formulation in commercial quantities under the BLS Supply Agreements, or (c) King's economic benefits hereunder.

ARTICLE VII

COMPENSATION

Section 7.1 Promotion Fees.

(a) In consideration for King's performance of its obligations under this Agreement, Depomed shall pay promotion fees (the Promotion Fees) to King as follows: following each Agreement Quarter during the Term, Depomed shall pay to King 50% of the Gross Margin for such Agreement Quarter.

(b) Within thirty (30) days following the end of each Agreement Quarter during the Term, Depomed shall provide King with a statement setting forth:

(i) the aggregate number of Units of Product sold to customers in the Territory during such Agreement Quarter;

(ii) Net Sales during such Agreement Quarter;

(iii) Depomed Net Sales during such Agreement Quarter (if any);

(iv) COGS during such Agreement Quarter (based on Depomed's Standard Cost);

(v) Advertising/Marketing/Educational Expense with respect to the costs of Samples (based on Depomed's Standard Cost) during such Agreement Quarter;

(vi) Gross Margin for such Agreement Quarter; and

(vii) a calculation of the amount, if any, payable by Depomed to King in respect of such Agreement Quarter pursuant to Section 7.3(a).

(c) Within 4 business days following the end of each Agreement Month (or if later, within two business days after such information becomes available to Depomed) during the Term, Depomed shall provide King with a statement setting forth the aggregate number of Units of Product sold to customers in the Territory during such Agreement Month.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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(d) Except as expressly specified otherwise, any amounts payable by one party to the other party in respect of any Agreement Quarter pursuant to this Agreement shall be paid within forty-five (45) days after the end of such Agreement Quarter.

Section 7.2 Maintenance of Records.

(a) Each party agrees to keep, for a period of at least three years after the date of entry (or such longer period as may be required by Legal Requirements) full and accurate records maintained in accordance with such party's accounting practices in sufficient detail to enable a Third Party to accurately calculate (i) in the case of Depomed, COGS, BLS Fees, Depomed's Advertising/Marketing/Educational Expenses, Net Sales and Depomed Net Sales reported, payments to be made under this Agreement and Details completed by the Depomed Sales Force, and (ii) in the case of King, King's Advertising/Marketing/Educational Expenses and PDEs completed by the King Sales Force. Upon 30 days prior written notice, such records shall be made available by the audited party for audit by an independent certified public accounting firm designated by the other party and reasonably acceptable to the party whose records are to be examined. The auditor will only examine such books and records during business hours but not more than once each fiscal year while this Agreement remains in effect and for three years thereafter in order to verify expenses, Net Sales, Depomed Net Sales, PDEs or Details completed, or payments due under this Agreement. The fees and expenses of the auditor performing such verification examination shall be borne by the party conducting the verification; provided, however, that if any verification reveals that the audited party has reported incorrectly, and the amount of such discrepancy is at least five percent of the aggregate amount that should have been reported for the period examined, then the audited party shall pay the entire amount of the fees and expenses for such verification.

(b) Each party shall have the right, upon five business days' prior written notice, to audit all applicable records of the other party (other than records described in Section 7.2(a)) for the purpose of determining the audited party's compliance with the obligations set forth in this Agreement, including with respect to training programs and certifications and records reports for the Samples. The audit will be conducted during normal business hours, at convenient times. Any such audit may be conducted no more than once each fiscal year. The fees and expenses of the auditing party shall be borne by such party. This right to audit shall extend throughout the term of this Agreement and for one year after expiration or termination of this Agreement.

(c) Whenever in this Agreement a party is required to report its costs, or is entitled to receive or obligated to make a payment based on its costs, such costs shall be determined in accordance with generally accepted accounting principles as applied in the United States (GAAP), consistent with the terms of this Agreement. The term out-of-pocket costs or expenses means cost or expenses paid to Third Parties and shall not include any fixed costs or expenses, personnel costs or expenses, overhead costs or expenses, or other costs or expenses of a similar nature.

(d) COGS and all Advertising/Marketing/Educational Expenses, including Samples, shall be determined in accordance with GAAP, except as follows: (i) COGS and Samples shall be calculated at Depomed's Standard Cost for each Agreement Quarter and reconciled

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

30







periodically as set forth in Section 7.5(d); and (ii) COGS shall include costs incurred by Depomed associated with achieving manufacturing efficiencies and ensuring Product supply.

(e) Depomed shall calculate Standard Costs in good faith to approximate as closely as reasonably practicable such actual costs calculated in accordance with GAAP (e.g., the unit cost of finished goods by bottle size or packaged samples) and shall provide the JCC with its methodology for calculating such costs. The JCC shall review Depomed's methodology for calculating Standard Cost at least annually during the Term to ensure that Depomed's Standard Costs continue to approximate as closely as reasonably practicable such actual costs calculated in accordance with GAAP, and Depomed shall revise such methodology following such review in accordance with the recommendations of the JCC.

Section 7.3 Payments. Any payments required to be made by either party under this Agreement shall be made in United States dollars via wire transfer of immediately available funds to such bank account as the other party shall designate in writing prior to the date of such payment.

Section 7.4 Tail Promotion Fees. Following the termination of this Agreement at the conclusion of the initial five year term or any additional term, for each of the eight full calendar quarters following such termination, Depomed shall pay to King an amount equal to, in each of the first four such calendar quarters, [***]% of the Net Sales for each such quarter and, in each of the fifth through eighth such calendar quarters, [***]% of such Net Sales for each such quarter.

Section 7.5 Expense Reimbursement.

(a) If Depomed pays Advertising/Marketing/Educational Expenses allocated to King under the Launch Plan or the Annual Plan, Depomed shall notify King at least five business days in advance of the payment of such Advertising/Marketing/Educational Expenses, and, unless King objects in writing to Depomed before the end of such five business-day period, King shall reimburse Depomed for such Advertising/Marketing/Educational Expenses within thirty days' after receipt of a detailed invoice therefor. If King pays Advertising/Marketing/Educational Expenses allocated to Depomed under the Launch Plan or the Annual Plan, King shall notify Depomed at least five business days in advance of the payment of such Advertising/Marketing/Educational Expenses, and, unless Depomed objects in writing to King before the end of such five business-day period, Depomed shall reimburse King for such Advertising/Marketing/Educational Expenses within thirty days' after receipt of a detailed invoice therefor.

(b) Within 15 days following the end of each Agreement Quarter, each party shall provide to the JCC a report setting forth in reasonable detail Advertising/Marketing/Educational Expenses incurred by such party in such Agreement Quarter in accordance with GAAP, including expenses incurred by a party but not reimbursed by the other party pursuant to Section 7.5(a) above or expenses reimbursed by a party pursuant to such section. Within 10 days thereafter, the JCC shall produce a report setting forth the calculation of Advertising/Marketing/Educational Expenses and its allocation between the parties in accordance with Section 4.5(e) above. The report shall also set forth the amount of any

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

31







payments that a party must make to the other party in order to achieve such allocation between the parties. All such payments shall be made within 45 days following the end of the applicable Agreement Quarter.

(c) At the end of each Agreement Quarter, the parties will reconcile their respective payments and expenses hereunder, including Promotion Fee payments and expense reimbursements pursuant to this Article VII, and, at the discretion of the party who has paid an amount greater than that allocable to such party for the relevant Agreement Quarter, such over-paying party will be reimbursed by the other party within 45 days following the end of the applicable Agreement Quarter, based on the report of the JCC described in Section 7.5(b) above or, at its discretion, will receive a credit against amounts payable by the over-paying party to the other party in the subsequent Agreement Quarter(s), which credit amount will be carried forward until fully credited or reimbursed. Reimbursement of expenses pursuant to this Section 7.5(c) shall be made based on Advertising/Marketing/Educational Expenses recorded in accordance with GAAP.

(d) The statement submitted by Depomed pursuant to Section 7.1(b) for the final Agreement Quarter of each calendar year during the Term, and the final Agreement Quarter of the Term, shall be accompanied by a report created by Depomed (a Reconciliation Report) that (i) reconciles Depomed's Standard Cost for COGS and Samples during such calendar year (or partial calendar year, as applicable) to Depomed's actual COGS and Depomed's actual out-of-pocket cost for Samples calculated in accordance with Section 7.2(d), (ii) sets forth any adjustment to Gross Margin for such calendar year (or partial calendar year, as applicable) on the basis of such reconciliation, and (iii) sets forth any adjustment to Advertising/Marketing/Educational Expenses for such calendar year (or partial calendar year, as applicable) based on reconciliation of actual costs for Samples. The report shall also set forth the amount of any payments that a party must make to the other party in order to achieve the proper allocation of the adjusted Gross Margin between the parties, pursuant to Section 7.1(a), for such calendar year and the proper allocation of Advertising/Marketing/Educational Expenses between the parties, pursuant to Section 4.5(e), for such calendar year. All such payments shall be made within 45 days following the receipt of the Reconciliation Report. Depomed may elect to submit Reconciliation Reports on a quarterly basis in accordance with the provisions of this Section 7.5(d), in which event (i) such quarterly Reconciliation Reports will accompany the statement submitted by Depomed pursuant to Section 7.1(b), and (ii) each reference in this Section 7.5(d) to a calendar year shall be deemed to be reference to an Agreement Quarter.

Section 7.6 Depomed Percentage. If, prior to or following the commencement of Product Promotion by the Depomed Sales Force, Depomed reasonably determines that the Prescriber Data fails to, or is likely to fail to, reasonably accurately reflect the portion of Net Sales attributable to prescriptions written by Professionals on the Depomed Physician List (whether as a result of Professionals opting out of the American Medical Association's Physician Masterfile database or otherwise), the parties shall negotiate in good faith with respect to implementing a revised manner of measuring the portion of Net Sales attributable to prescriptions written by Professionals on the Depomed Physician List, and reflect any such modification in the definition of Depomed Percentage and the Baseline Percentage. The parties shall consider in their discussions any other customary manner of determining similar

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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information as may arise in light of Professionals opting out of the American Medical Association's Physician Masterfile database.

ARTICLE VIII

TERM AND TERMINATION

Section 8.1 Term. The term of this Agreement shall commence on the Effective Date and shall continue, unless terminated sooner in accordance with this Article VIII, until June 27, 2011 (the Term). The Term of this Agreement shall be extended for subsequent one year periods upon the mutual agreement of the parties, which agreement shall be set forth in writing (in which event a party that desires to so extend the Term of this Agreement shall notify the other party at least 120 days prior to the termination of this Agreement).

Section 8.2 Early Termination.

(a) Depomed and King shall have the following rights with respect to the performance of PDEs:

(i) In the event King performs more than [***] PDEs each Agreement Quarter (the PDE Minimum) in any Agreement Quarter, such excess PDEs will be carried forward to the immediately following Agreement Quarter. In the event that King does not perform the PDE Minimum in any Agreement Quarter (the difference between such PDE Minimum and the number of PDEs actually conducted, the PDE Shortfall), King will have until the end of the Agreement Quarter immediately following to cure its failure by providing a sufficient number of excess PDEs in the immediately following Agreement Quarter.

(ii) If King does not perform, in the aggregate, two times the PDE Minimum in any two consecutive Agreement Quarters, Depomed may demand that King cure such default by (A) [***] and (B) [***], in each case, prior to the end of the next succeeding Agreement Quarter following notice from Depomed.

(iii) Upon the third failure by King to meet the PDE Minimum during any six consecutive Agreement Quarters, Depomed shall have the right to [***] or demand that King shall cure such default in the same manner outlined in clause (i) above for the first such default.

(b) If, as of the end of any period of the immediately previous four consecutive Agreement Quarters, Promotion Net Sales for such period are less than $[***], either party shall have the right to terminate this Agreement on 120 days' prior written notice to the other party, which notice may not be given before the third anniversary of the Promotion Commencement Date.

(c) If a party desires to exercise its option to terminate this Agreement pursuant to this Section 8.2 or demand any [***] or cure pursuant to Section 8.2(a), it must give written notice to the other party within 60 days after receiving the report of the Agreement Quarter or Agreement Month giving rise to the right to terminate this Agreement pursuant to Section 8.2.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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Section 8.3 Termination for Cause. Either party may terminate this Agreement, effective at any time after providing sixty days written notice and an opportunity to cure during such sixty day period (ninety days in the case of a breach by Depomed of Section 6.1), in the event of a material failure of the other party to comply with its material obligations contained in this Agreement. If such cure is effected, such notice with respect to such termination shall be null and void.

Section 8.4 Termination for Bankruptcy or Force Majeure. To the extent permitted by law, each party will have the right to terminate this Agreement immediately upon notice to the other party, in the event of either of the following:

(a) The entry of an order for relief under the United States Bankruptcy Code (or any corresponding remedy under successor laws) against the other party; the filing of a petition by or against the other party under any bankruptcy, insolvency or similar law (which petition is not dismissed within sixty days after filing), except Chapter 11 of the United States Bankruptcy Code or any successor statute that permits a corporation to continue its operation while protecting it from creditors; the appointment of a receiver for the other party's business or property; or the other party's making of a general assignment for the benefit of its creditors; or

(b) Any Force Majeure Event affecting the other party beyond the other party's control which lasts for a period of at least six months and which is of sufficient intensity to interrupt or prevent the carrying out of such other party's material obligations under this Agreement during such period.

Notwithstanding the occurrence of any of the event specified in subsection (a) of this Section 8.4, the parties acknowledge and agree that, to the extent Section 365(n) of the United States Bankruptcy Code applies to this Agreement, the non-insolvent party may elect to retain and exercise the rights granted to it hereunder with respect to the intellectual property owned or controlled by the insolvent party.

Section 8.5 Force Majeure. Any Force Majeure Event of the type described in Section 16.7 affecting a party hereunder shall entitle the other party hereto, at any time after the expiry of the period of six months specified therein and upon sixty days written notice given after such six month period (such notice being, null and void if the Force Majeure Event is discontinued during such sixty-day period), in addition to the right to terminate this Agreement under Section 8.4, the right to (i) extend this Agreement for a period equal to the duration of the Force Majeure Event which occasioned the delay, interruption or prevention (subject to the maximum term of six months) or (ii) continue the Agreement in full force and effect without modification. In no circumstances will either party be liable to the other for its inability to perform under this Agreement due to any such Force Majeure Event.

Section 8.6 Recall. Either party shall have the right to terminate this Agreement in the event of a large scale recall or withdrawal of the Product from the Territory resulting from a significant safety risk inherent in the Product and not due to tampering, a remediable manufacturing problem, or other defect that can be cured with respect to Products manufactured after such risk is discovered.

Section 8.7 Effect of Termination.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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(a) No additional payment obligations arising under Article VII hereof shall accrue after the date of expiration or termination of this Agreement except as set forth in Section 7.4; provided, however, that expiration or termination of this Agreement shall not relieve either party of any obligations accruing prior to such expiration or termination. Certain provisions of this Agreement by their terms continue after the expiration or termination of this Agreement. In addition, any other provisions required to interpret and enforce the parties' rights and obligations under this Agreement shall also survive, but only to the extent required for the full observation and performance of this Agreement.

(b) Except as indicated in Sections 8.5, expiration or termination of this Agreement shall be without prejudice to (a) any remedies which any party may then or thereafter have hereunder or at law; and (b) a party's right to receive any payment accrued under the Agreement prior to the termination date but which became payable thereafter; and (c) either party's right to obtain performance of any obligations provided for in this Agreement which survive termination by their terms or by a fair interpretation of this Agreement. Except as expressly set forth herein, the rights to terminate as set forth herein shall be in addition to all other rights and remedies available under this Agreement, at law, or in equity or otherwise.

(c) Upon the expiration or termination of this Agreement pursuant to this Article VIII, each party shall promptly transfer and return to the other party all Proprietary Information of the other party (provided that each party may keep one copy of such Proprietary Information of for archival purposes only). Upon the expiration or termination of this Agreement, King shall provide to Depomed, at King's out-of-pocket cost therefor, all Promotional Materials in King's possession (including electronic files of all Promotional Materials); provided, however, that King may destroy any printed copies of Promotional Materials bearing the King Trademarks and may remove the King Trademarks from electronic files of Promotional Materials.

ARTICLE IX

REPRESENTATIONS AND WARRANTIES

Section 9.1 Representations and Warranties of Depomed. Depomed hereby represents and warrants to King as of the date hereof as follows:

(a) Organization. Depomed (i) is a corporation duly organized, validly existing and in good standing under the laws of the state of California, and (ii) has all necessary corporate power and corporate authority to own its properties and to conduct its business, as currently conducted.

(b) Authorization. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby are within the corporate power of Depomed, have been duly authorized by all necessary corporate proceedings of Depomed, and this Agreement has been duly executed and delivered by Depomed.

(c) No Conflict. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby do not: (i) conflict with or result in a breach of any provision of Depomed's organizational documents; (ii) result in a material breach

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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of any material agreement to which Depomed is party; (iii) result in a violation of any Order to which Depomed is subject; (iv) require Depomed to obtain any material approval or consent from any Governmental Authority or Third Party other than those consents and approvals which have been obtained prior to the date hereof; or (v) violate any Legal Requirement applicable to Depomed in any material respect.

(d) Enforceability. This Agreement constitutes the valid and binding obligation of Depomed, enforceable against Depomed in accordance with its terms, subject to bankruptcy, reorganization, insolvency and other similar laws affecting the enforcement of creditors' rights in general and to general principles of equity (regardless of whether considered in a proceeding in equity or an action at law).

(e) Broker. Depomed has not employed any broker, finder, or agent with respect to this Agreement or the transactions contemplated hereby.

(f) Depomed Intellectual Property. To the knowledge of Depomed, the Promotion and sale of Product in the Territory in accordance with this Agreement will not infringe any patents, trademarks or other intellectual property rights of any Third Party; provided, that Depomed makes no representation as to the King Trademarks. Depomed has the right, power and authority to grant the licenses granted by it hereunder, including the right, power and authority to license to King, pursuant to Section 6.6, all Technology necessary for the manufacture of the Product.

(g) Litigation. There is no litigation, arbitration proceeding, governmental investigation, action or claims of any kind, pending or, to the knowledge of Depomed, threatened, by or against Depomed or any of its Affiliates relating to the Product or which would reasonably be expected to materially affect Depomed's ability to perform its obligations hereunder.

(h) Documentation. Depomed has made available to King copies of substantially all clinical data and reports, medical information, competitive information, marketing research and other documentation related to the Product in Depomed's possession that have been requested by King in the course of King's due diligence investigation of the Product.

(i) Supply. Depomed currently has access to sufficient supplies of Product to perform the manufacturing obligations required by it under this Agreement. All Product will be manufactured with reasonable due care and in conformity with current generally accepted standards and procedures for manufacturing the Product and cGMP.

(j) Generic Drug Act. Pursuant to the Generic Drug Enforcement Act of 1992, 21 U.S.C. § 335a, as may be amended or supplemented (the Generic Drug Act),

(i) none of Depomed, its Affiliates, or any Person under its direction or control is currently debarred by the FDA under the Generic Drug Act;

(ii) none of Depomed, its Affiliates, or any Person under its direction or control is currently using or will use in any capacity in connection with the Product any Person that is debarred by FDA under the Generic Drug Act; and

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

36







(iii) there have been no convictions of Depomed, its Affiliates, or any Person under its direction or control for any of the types of crimes set forth in the Generic Drug Act within the five years prior to the Effective Date.

(k) Legal Requirements. None of Depomed, its Affiliates, or Person under its direction or control is currently excluded from a federal or state health care program under Sections 1128 or 1156 of the Social Security Act, 42 U.S.C. §§ 1320a-7, 1320c-5 as may be amended or supplemented. None of Depomed, its Affiliates, or Person under its direction or control is otherwise currently excluded from contracting with the federal government. None of Depomed, its Affiliates, or Person under its direction or control is otherwise currently excluded, suspended, or debarred from any federal or state program. Depomed shall immediately notify King if, at any time during the Term, Depomed, its Affiliates, or any Person under its direction or control is convicted of an offense that would subject it or King to exclusion, suspension, or debarment from any federal or state program.

(l) NDA Acquisition. Depomed has not committed fraud in relation to the filing or acquisition of an NDA or used unfair methods of competition in connection with such filing or acquisition, including, in either case, in connection with any data supplied by Depomed to the FDA. The parties acknowledge that a breach of this representation is a material failure of a material obligation and is not subject to cure.

(m) BLS Agreements. Depomed is not in material breach of the BLS Agreements and has not submitted to BLS any notice (written or oral) to the effect that BLS is in breach of the BLS Agreements. Depomed has not received from BLS any notice (written or oral) to the effect that Depomed is in breach of the BLS Agreements. The BLS Agreements are legal, valid, binding, enforceable and in full force and effect in all material respects.

Section 9.2 Representations and Warranties of King. King hereby represents and warrants to Depomed as of the date hereof as follows:

(a) Organization. King (i) is a corporation duly organized, validly existing and in good standing under the laws of the state of Tennessee, and (ii) has all necessary corporate power and corporate authority to own its properties and to conduct its business, as currently conducted.

(b) Authorization. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby are within the corporate power of King, have been duly authorized by all necessary corporate proceedings of King, and this Agreement has been duly executed and delivered by King.

(c) No Conflict. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby do not: (i) conflict with or result in a breach of any provision of King's organizational documents; (ii) result in a material breach of any material agreement to which King is party; (iii) result in a violation of any Order to which King is subject; (iv) require King to obtain any material approval or consent from any Governmental Authority or Third Party other than those consents and approvals which have been

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

37







obtained prior to the date hereof; or (v) violate any Legal Requirement applicable to King in any material respect.

(d) Enforceability. This Agreement constitutes the valid and binding obligation of King, enforceable against King in accordance with its terms, subject to bankruptcy reorganization, insolvency and other similar laws affecting the enforcement of creditors' rights in general and to general principles of equity (regardless of whether considered in a proceeding in equity or an action at law).

(e) Broker. King has not employed any broker or finder with respect to this Agreement or the transactions contemplated hereby.

(f) King Trademarks. To the knowledge of King, the use of the King Trademarks to Promote and sell Product in the Territory in accordance with this Agreement will not infringe any trademarks or other intellectual property rights of any Third Party.

(g) Litigation. There is no litigation, arbitration proceeding, governmental investigation, action or claims of any kind, pending or, to the knowledge of King, threatened, by or against King or any of its Affiliates relating to the Product or which would reasonably be expected to materially affect King's ability to perform its obligations hereunder.

(h) Generic Drug Act. Pursuant to the Generic Drug Act,

(i) none of King, its Affiliates, or any Person under its direction or control is currently debarred by the FDA under the Generic Drug Act;

(ii) none of King, its Affiliates, or any Person under its direction or control is currently using or will use in any capacity in connection with the Product any Person that is debarred by FDA under the Generic Drug Act; and

(iii) there have been no convictions of King, its Affiliates, or any Person under its direction or control for any of the types of crimes set forth in the Generic Drug Act within the five years prior to the Effective Date.

(i) Legal Requirements. None of King, its Affiliates, or Person under its direction or control is currently excluded from a federal or state health care program under Sections 1128 or 1156 of the Social Security Act, 42 U.S.C. §§ 1320a-7, 1320c-5 as may be amended or supplemented. None of King, its Affiliates, or Person under its direction or control is otherwise currently excluded from contracting with the federal government. None of King, its Affiliates, or Person under its direction or control is otherwise currently excluded, suspended, or debarred from any federal or state program. King shall immediately notify Depomed if, at any time during the Term, King, its Affiliates, or any Person under its direction or control is convicted of an offense that would subject it or Depomed to exclusion, suspension, or debarment from any federal or state program.

Section 9.3 Depomed Disclaimer. EXCEPT AS EXPRESSLY PROVIDED HEREIN, DEPOMED DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED,

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

38







WITH REGARD TO THE PRODUCT, INCLUDING THE WARRANTY OF MERCHANTABILITY AND WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE.

Section 9.4 King Disclaimer. EXCEPT AS EXPRESSLY PROVIDED HEREIN, KING DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING THE WARRANTY OF MERCHANTABILITY AND WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE.

ARTICLE X

INTELLECTUAL PROPERTY MATTERS

Section 10.1 Third Party Competition. Expressly excluding Article XIII of this Agreement, nothing in this Agreement shall limit or restrict Depomed's ability to grant non-exclusive patent licenses to patents and patent applications included within the Technology or otherwise covering the Product in connection with the settlement of any pending, threatened or contemplated patent litigation with respect to extended release metformin products commercialized in the Territory prior to the Effective Date, including any such litigation against marketers of metformin products (each such license, an AcuForm Patent License). However, in recognition of the parties' agreement to co-exclusively Promote Products, in accordance with the terms and conditions of this Agreement, Depomed agrees that if Depomed or any Affiliate thereof grants to any Affiliate or Third Party a license, covenant not to sue, right of reference, right of supply or other intellectual right (in any case, other than AcuForm Patent Licenses and covenants not to sue and other rights in connection with the grant of AcuForm Patent Licenses for extended release metformin products commercialized in the Territory prior to the Effective Date) related to the manufacture, use, offer for sale, sale, importation, marketing or promotion of any Product that uses Depomed's or its Affiliate's proprietary drug delivery technology currently referred to as the AcuForm technology and described in U.S. Patent Nos. 6,340,475 and 6,635,280 or other drug delivery technology incorporated into any formulation of the Product, including any authorized generic version of any Product covered by any NDA, then the parties shall negotiate in good faith financial adjustments to this Agreement adequate to compensate King for any lost market share attributable to sales of product by or on behalf of such Third Party or Affiliate, taking into account the consideration received by Depomed or its Affiliates for the grant of such rights.

Section 10.2 Infringement.

(a) If either party shall learn of a claim or assertion that the manufacture, use or sale of the Product in the Territory infringes or otherwise violates the intellectual property rights of any Third Party or that any Third Party violates the intellectual property rights owned or Controlled by (i) Depomed in the Product and the Depomed Trademarks in the Territory or (ii) King in the King Trademarks, then the party becoming so informed shall promptly, but in all events within fifteen (15) business days thereof, notify the other party to this Agreement of the claim or assertion.

(b) If warranted in the opinion of Depomed, after consultation with the JCC, Depomed shall take such legal action as is advisable in Depomed's opinion to restrain

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

39







infringement of such Depomed patent rights or the Depomed Trademarks. King shall cooperate fully with, and as reasonably requested by, Depomed in Depomed's attempt to restrain such infringement, and Depomed shall reimburse King for its out-of-pocket expenses incurred in providing such cooperation. King may be represented by counsel of its own selection at its own expense in any suit or proceeding brought to restrain such infringement, but Depomed shall have the right to control the suit or proceeding.

(c) If warranted in the opinion of King, King shall take such legal action as is advisable in King's opinion to restrain such infringement of the King Trademarks. Depomed shall cooperate fully with, and as requested by, King in King's attempt to restrain such infringement, and King shall reimburse Depomed for its out-of-pocket expenses incurred in providing such cooperation. Depomed may be represented by counsel of its own selection at its own expense in any suit or proceeding brought to restrain such infringement, but King shall have the right to control the suit or proceeding.

ARTICLE XI

INDEMNIFICATION; LIMITS ON LIABILITY

Section 11.1 Indemnification. Each party will defend, at its own expense, indemnify and hold harmless the other party and its Affiliates from and against any and all damages, liabilities, losses, costs, and expenses, including reasonable attorneys' fees, arising out of any Third Party claim, suit or proceeding brought against the other party or its Affiliates to the extent such claim, suit, or proceeding is based upon a claim arising out of or relating to (i) any breach or violation of, or failure to perform, any covenant or agreement made by such indemnifying party in this Agreement, unless waived in writing by the indemnified party; (ii) any breach of the representations or warranties made by such indemnifying party in this Agreement; or (iii) the negligence or willful misconduct of the indemnifying party, except (under any of (i) or (ii)) to the extent arising out of the breach, violation, failure, negligence or willful misconduct of the indemnified party. In addition, Depomed will defend, at its own expense, indemnify and hold harmless King and its Affiliates from and against any and all damages, liabilities, losses, costs, and expenses, including reasonable attorneys' fees, arising out of any Third Party claim, suit or proceeding brought against King or its Affiliates to the extent such claim, suit, or proceeding is based upon a claim arising out of or relating to (w) any actions of the Depomed Sales Force, including any false or misleading representations to Professionals, customers or others regarding King or the Product; (x) any agreement between Depomed and BLS; or (y) any claim made by any Person that the manufacture, use or sale of the Product infringes or misappropriates the patent, trademark, or other intellectual property rights of such Person, except with respect to any claim relating to the King Trademarks; and (z) any product liability claim made by any Person with respect to the Product, except to the extent liability is based on a breach by King of Section 4.2. Each party agrees that it shall promptly notify the other in writing of any such claim or action and give the indemnifying party full information and assistance in connection therewith. The indemnifying party shall have the sole right to control the defense and the sole right to settle or compromise any such claim or action, except that the prior written consent of the other party shall be required in connection with any settlement or compromise which could (i) place any obligation on or require any action of such other party; (ii) admit or imply any liability or wrongdoing of such other party; or (iii) adversely affect the goodwill or public image of such

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

40







other party. Notwithstanding the foregoing, the indemnified party may participate therein through counsel of its choice, but the cost of such counsel shall be borne solely by the indemnified party. The provisions of this Section 11.1 shall survive the termination of this Agreement for three years (except as to claims as to which a party has notified the other in writing prior to the third anniversary of the termination date of this Agreement, in which event, the indemnifying party's obligations under this Section 11.1 shall survive with respect to any such claim until its resolution).

Section 11.2 Consequential Damages. NEITHER KING NOR DEPOMED (WHICH FOR THE PURPOSES OF THIS SECTION 11.2 SHALL INCLUDE THEIR RESPECTIVE AFFILIATES, DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS) SHALL HAVE ANY LIABILITY TO THE OTHER FOR ANY PUNITIVE DAMAGES, SPECIAL, INCIDENTAL, CONSEQUENTIAL OR INDIRECT DAMAGES, RELATING TO OR ARISING FROM THIS AGREEMENT, EVEN IF SUCH DAMAGES MAY HAVE BEEN FORESEEABLE; PROVIDED THAT SUCH LIMITATION SHALL NOT APPLY IN THE CASE OF FRAUD OR WILLFUL MISCONDUCT.

ARTICLE XII

CONFIDENTIALITY AND PUBLICITY

Section 12.1 Proprietary Information. Pursuant to this Agreement, a party receiving Proprietary Information from the other, directly or indirectly, will treat such Proprietary Information as confidential, will use such Proprietary Information only for the purposes of this Agreement and will not disclose, and will take all reasonable precautions to prevent the disclosure of, such Proprietary Information to (a) any of its officers, directors, managers, equity holders, employees, agents, representatives, Affiliates or consultants who are not required to know such Proprietary Information or who are not bound by a like obligation of confidentiality or (b) to Third Parties.

Section 12.2 Disclosures Required by Law. In the event the recipient party is required under applicable Legal Requirements to disclose Proprietary Information of the disclosing party to any Governmental Authority to obtain any Regulatory Approval for the Product, is required to disclose Proprietary Information in connection with bona fide legal process (including in connection with any bona fide dispute hereunder) or is required to disclose Proprietary Information under the rules of the securities exchange upon which its securities are traded, the recipient party may do so only if it limits disclosure to that purpose after giving the disclosing party prompt written notice of any instance of such a requirement in reasonable time for the disclosing party to attempt to object to or to limit such disclosure. In the event of disclosures required under applicable Legal Requirements, the recipient party shall cooperate with the disclosing party as reasonably requested thereby.

Section 12.3 Publicity. Neither party will originate any publicity, news release, public comment or other public announcement, whether to the press, to stockholders, or otherwise, relating to this Agreement, without the consent of the other party, except for such announcement which, in accordance with the advice of legal counsel to the party making such announcement, is required by law; provided, however, that each party shall be entitled to refer publicly to the

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

41







relationship of the parties reflected in this Agreement (i.e., Depomed as the developer of the Product and King as the co-promoter of the Product in the Territory) in a manner that is consistent with the joint press release issued by the parties and that is not damaging to the business or reputation of the other party. Except as otherwise permitted pursuant to the immediately preceding sentence, any party making any announcement which is required by law will, unless prohibited by law, give the other party an opportunity to review the form and content of such announcement and comment before it is made. Either party shall have the right to make such filings with governmental agencies, including the United States Securities and Exchange Commission, as to the contents and existence of this Agreement as it shall reasonably deem necessary or appropriate. The parties have agreed upon the form and content of a joint press release to be issued by the parties promptly following the execution of this Agreement. Once such press release or any other written statement is approved for disclosure by both parties, either party may make subsequent public disclosure of the contents of such statement without the further approval of the other party. The provisions of this Article 12 shall survive termination of the agreement and shall remain in effect until a date three years after the Term of this Agreement.

ARTICLE XIII

COMBINATION PRODUCTS; RIGHT OF FIRST NEGOTIATION

Section 13.1 Combination Products.

(a) Depomed agrees to grant and hereby grants to King an exclusive option (exercisable at King's sole discretion by providing written notice of intent at any time, but in no event later than 180 days after the Effective Date) to obtain an exclusive license in the Territory to certain of Depomed's proprietary drug delivery technology in combination with both metformin hydrochloride and any other active pharmaceutical ingredients (a Combination Product License). If King notifies Depomed in writing within 180 days after the Effective Date that King desires to exercise its option to obtain a Combination Product License, King and Depomed shall promptly commence good-faith negotiations regarding a definitive agreement providing for the Combination Product License, for a period of 60 days or such longer period as may be mutually agreed upon by the parties in writing; and it is agreed that, as part of such good faith negotiations, the parties will discuss, for inclusion in any definitive agreement, appropriate non-compete obligations for each party with respect to any product containing metformin hydrochloride as an active pharmaceutical ingredient. If Depomed and King fail to enter into such a definitive agreement during such period, then Depomed shall thereafter have the right to negotiate and enter into one or more agreements with Third Parties related to Depomed's proprietary drug delivery technology in combination with both metformin hydrochloride and other active pharmaceutical ingredients; provided that, for a period of 6 months, any such agreement may not be on terms and conditions materially more favorable to the Third Party than the terms and conditions last offered by King prior to the termination of discussions with Depomed.

(b) In the event the parties are not able to enter a definitive agreement with respect to a Combination Product License, pursuant to Section 13.1(a), then prior to the expiration or termination of this Agreement, except pursuant to this Agreement, (i) neither party, nor any

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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Person controlled by a party, will be entitled to commercially launch in the Territory (either directly or indirectly through a marketing partner) a product containing metformin as an active pharmaceutical ingredient, and (ii) no Affiliate of Depomed will be entitled to commercially launch in the Territory (either directly or indirectly through a marketing partner) a product that (A) contains metformin as an active pharmaceutical ingredient and (B) uses Depomed's or its Affiliate's proprietary drug delivery technology currently referred to as the AcuForm technology and described in U.S. Patent Nos. 6,340,475 and 6,635,280.

Section 13.2 Right of First Negotiation. Depomed shall notify King in writing in the event that Depomed desires to divest itself of its rights to the Product in the Territory (e.g., by asset sale or product license to a Third Party), or of its rights in the Territory to a product owned or controlled by Depomed containing metformin and another active pharmaceutical ingredient in combination with Depomed's proprietary drug delivery technology incorporated within the Product (currently referred to as the AcuForm technology) (a Combination Product). If King notifies Depomed in writing within 30 days after receipt of such notice (the Evaluation Period) that King is not interested in obtaining all of Depomed's rights in and to the Product or the applicable Combination Product (such rights, Metformin Product Rights), or if King fails to notify Depomed of King's interest in obtaining the Metformin Product Rights, in either case prior to the expiration of the Evaluation Period, then Depomed shall have no further obligation to King under this Agreement with respect to the applicable Metformin Product Rights. If King is interested in obtaining the Metformin Product Rights, it shall so notify Depomed in writing prior to the expiration of the Evaluation Period, and upon Depomed's receipt of such notice King and Depomed shall promptly commence good-faith negotiations, for a period of 30 days and such longer period as may be mutually agreed upon by the parties in writing in the event the parties have made material progress in the negotiations (the Negotiation Period), regarding the commercially reasonable terms of an agreement pursuant to which King shall obtain the Metformin Product Rights. If Depomed and King fail to enter into an agreement for the Metformin Product Rights prior to the expiration of the Negotiation Period, then Depomed shall thereafter have the right to negotiate and enter into an agreement with a Third Party granting the Metformin Product Rights to a Third Party; provided that, for a period of 6 months, any such agreement may not be on terms and conditions materially more favorable to the Third Party than the terms and conditions last offered by King prior to the termination of discussions with Depomed. The provisions of this Section 13.2 shall not apply to, and Depomed shall have no obligation to King under this Section 13.2 in respect of, any acquisition of Depomed by a Third Party, any merger or consolidation with or involving Depomed, any acquisition by a Third Party of any material portion of the stock of Depomed, or any acquisition by a Third Party of a material portion of the assets of Depomed in addition to the Product or any Combination Product; provided that such Third Party must remain bound by the terms and conditions of this Agreement, including this Section 13.2.

ARTICLE XIV

NOTICES

Section 14.1 Notices. All notices required or permitted hereunder shall be given in writing and sent by facsimile transmission (with a copy sent by first-class mail), or mailed

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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postage prepaid by certified or registered mail (return receipt requested), or sent by a nationally recognized express courier service, or hand-delivered at the following address:

If to Depomed:

Depomed, Inc. 1360 O'Brien Drive Menlo Park, California 94025 Attention: President Fax No.: (650) 462-9991

With a copy to:

Heller Ehrman LLP 275 Middlefield Road Menlo Park, CA 94025 Attention: Julian Stern Fax No: (650) 324-0638

If to King:

King Pharmaceuticals, Inc. 501 Fifth Street Bristol, Tennessee 37620 Attn: Legal Affairs Department Facsimile: (423) 990-2566

All notices shall be deemed made upon receipt by the addressee as evidenced by the applicable written receipt.

ARTICLE XV

INSURANCE

Section 15.1 Insurance.

(a) During the Term and for a period of two (2) years after any expiration or termination of this Agreement, each party shall maintain (i) a commercial general liability insurance policy or policies with minimum limits of $[***] per occurrence and $[***] in the aggregate on an annual basis and (ii) a product liability insurance policy or policies with minimum limits of $[***] per occurrence and $[***] in the aggregate on an annual basis; provided that the minimum product liability policy limits set forth above shall be increased to at least $[***] per occurrence and $[***] in the aggregate on an annual basis no later than December 31, 2006. Furthermore, Depomed will undertake to direct its insurance broker to conduct an analysis to determine the appropriate level of product liability insurance with respect to the Product to be maintained by Depomed, which analysis will be conducted prior to Depomed's next insurance renewal, currently scheduled to occur in October 2006. Such analysis will include, among other considerations, product risk characteristics, product litigation history,

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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comparable company coverage and insurance availability. Depomed will share such analysis with King

(b) Upon request, each party shall provide certificates of insurance to the other evidencing the coverage specified herein. Neither party's liability to the other is in any way limited to the extent of its insurance coverage.

ARTICLE XVI

MISCELLANEOUS

Section 16.1 Headings. The titles, headings or captions and paragraphs in this Agreement are for convenience only and do not define, limit, extend, explain or describe the scope or extent of this Agreement or any of its terms or conditions and therefore shall not be considered in the interpretation, construction or application of this Agreement.

Section 16.2 Severability. In the event that any of the provisions or a portion of any provision of this Agreement is held to be invalid, illegal, or unenforceable by a court of competent jurisdiction or a governmental authority, such provision or portion of provision will be construed and enforced as if it had been narrowly drawn so as not to be invalid, illegal, or unenforceable, and the validity, legality, and enforceability of the enforceable portion of any such provision and the remaining provisions will not be adversely affected thereby.

Section 16.3 Entire Agreement. This Agreement, together with the schedules and exhibits hereto and the Confidentiality Agreement, all of which are incorporated by reference, contains all of the terms agreed to by the parties regarding the subject matter hereof and supersedes any prior agreements, understandings, or arrangements between them, whether oral or in writing.

Section 16.4 Amendments. This Agreement may not be amended, modified, altered, or supplemented except by means of a written agreement or other instrument executed by both of the parties hereto. No course of conduct or dealing between the parties will act as a modification or waiver of any provisions of this Agreement.

Section 16.5 Counterparts. This Agreement may be executed in any number of counterparts, each of which will be deemed an original as against the party whose signature appears thereon, but all of which taken together will constitute but one and the same instrument.

Section 16.6 Waiver. The failure of either party to enforce or to exercise, at any time or for any period of time, any term of or any right arising pursuant to this Agreement does not constitute, and will not be construed as, a waiver of such term or right, and will in no way affect that party's right later to enforce or exercise such term or right.

Section 16.7 Force Majeure.

(a) In the event of any failure or delay in the performance by a party of any provision of this Agreement due to acts beyond the reasonable control of such party (such as, for example, fire, explosion, strike or other difficulty with workmen, shortage of transportation equipment,

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

45







accident, act of God, declared or undeclared wars, acts of terrorism, or compliance with or other action taken to carry out the intent or purpose of any law or regulation) (a Force Majeure Event), then such party shall have such additional time to perform as shall be reasonably necessary under the circumstances. In the event of such failure or delay, the affected party will use its diligent efforts, consistent with sound business judgment and to the extent permitted by law, to correct such failure or delay as expeditiously as possible. In the event that a party is unable to perform by a reason described in this Section 16.7, its obligation to perform under the affected provision of this Agreement shall be suspended during such time of nonperformance.

(b) Neither party shall be liable hereunder to the other party nor shall be in breach for failure to perform its obligations caused by a Force Majeure Event. In the case of any such event, the affected party shall promptly, but in no event later than 10 days of its occurrence, notify the other party stating the nature of the condition, its anticipated duration and any action being taken to avoid or minimize its effect. Furthermore, the affected party shall keep the other party informed of the efforts to resume performance. After sixty (60) days of such inability to perform, the parties agree to meet and in good faith discuss how to proceed. In the event that the affected party is prevented from performing its obligations pursuant to this Section 16.7 for a period of six (6) months, the other party shall have the right to terminate this Agreement pursuant to the provisions of Sections 8.4(b).

Section 16.8 Successors and Assigns. Subject to Section 16.9, this Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and assigns permitted under this Agreement.

Section 16.9 Assignment. This Agreement and the rights granted herein shall not be assignable by either party hereto without the prior written consent of the other party. Any attempted assignment without consent shall be void. Notwithstanding the foregoing, a party may transfer, assign or delegate its rights and obligations under this Agreement without consent to (a) an Affiliate or (b) a successor to all or substantially all of its business or assets of the assigning party to which this Agreement relates, whether by sale, merger, consolidation, acquisition, transfer, operation of law or otherwise or (c) in the case of either party, to one or more financial institutions providing financing to such party pursuant to the terms of a security agreement relating to such financing. In connection with any assignment, or Subcontracting pursuant to which a Third Party Sales Representative is engaged to Promote the Product, of this Agreement or any of the rights granted herein pursuant to this Section 16.9, the assignor, or party Subcontracting to another, shall ensure that the assignee, or Subcontractor, represents and warrants the matters set forth in Sections 9.1(j) and (k) (in substantially the same form as set forth in Sections 9.1(j) and (k)), where Depomed (or one of its successors or assigns) is the assignor or Subcontracting party, or Sections 9.2(h) and (i) (in substantially the same form as set forth in Sections 9.2(h) and (i)), where King (or one of its successors or assigns) is the assignor or Subcontracting party. In connection with any Subcontracting pursuant to which a Third Party will manufacture the Product, the party Subcontracting to another shall use its commercially reasonable efforts to cause the Subcontractor to represent and warrant the matters set forth in Sections 9.1(j) and (k) (in substantially the same form as set forth in Sections 9.1(j) and (k)). Neither party shall knowingly engage any Third Party appearing on the FDA's debarment list or the list of excluded individuals/entities of the Office of Inspector General of the Department of Health and Human Services to perform, or assist such party in the performance of, its obligations

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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under this Agreement, and each party shall review each such list prior to engaging any such Third Party.

Section 16.10 Construction. The parties acknowledge and agree that: (a) each party and its representatives have reviewed and negotiated the terms and provisions of this Agreement and have contributed to its revision; and (b) the terms and provisions of this Agreement will be construed fairly as to each party hereto and not in favor of or against either party regardless of which party was generally responsible for the preparation or drafting of this Agreement. Unless the context of this Agreement otherwise requires: (i) words of any gender include each other gender; (ii) words using the singular or plural number also include the plural or singular number, respectively; (iii) the terms hereof, herein, hereby, and derivative or similar words refer to this entire Agreement; (iv) the terms Article, Section, Exhibit, Schedule, or clause refer to the specified Article, Section, Exhibit, Schedule, or clause of this Agreement; (v) or is disjunctive but not necessarily exclusive; and (vi) the term including or includes means including without limitation or includes without limitation. Whenever this Agreement refers to a number of days, such number shall refer to calendar days unless business days are specified.

Section 16.11 Governing Law. This Agreement will be construed under and in accordance with, and governed in all respects by, the laws of the State of New York, without regard to its conflicts of law principles.

Section 16.12 Equitable Relief. Each party acknowledges that a breach by it of the provisions of this Agreement may not reasonably or adequately be compensated in damages in an action at law and that such a breach may cause the other party irreparable injury and damage. By reason thereof, each party agrees that the other party is entitled to seek, in addition to any other remedies it may have under this Agreement or otherwise, preliminary and permanent injunctive and other equitable relief to prevent or curtail any breach of this Agreement by the other party; provided, however, that no specification in this Agreement of a specific legal or equitable remedy will be construed as a waiver or prohibition against the pursuing of other legal or equitable remedies in the event of such a breach. Each party agrees that the existence of any claim, demand, or cause of action of it against the other party, whether predicated upon this Agreement, or otherwise, will not constitute a defense to the enforcement by the other party, or its successors or assigns, of the covenants contained in this Agreement.

Section 16.13 Relationship Between Parties. The parties hereto are acting and performing as independent contractors, and nothing in this Agreement creates the relationship of partnership, joint venture, sales agency, or principal and agent. Neither party is the agent of the other, and neither party may hold itself out as such to any other party. All financial obligations associated with each party's business will be the sole responsibility of such party.

[Signature page follows]

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed in duplicate on the day and year first above written.             DEPOMED, INC.     By:/s/ John W. Fara       Name:John W. Fara       Title: President and CEO                 KING PHARMACEUTICALS, INC.     By:/s/ Brian A. Markison       Name:Brian A. Markison       Title: President and CEO

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.







SCHEDULES

Schedule 1.33 — Depomed Trademarks

Schedule 1.54 — King Trademarks

Schedule 1.56 — Initial Launch Plan

Schedule 3.2 — JCC Members

Schedule 4.5 — Advertising/Marketing/Educational Expenses

Schedule 6.3 — Volume Forecast

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.







Schedule 1.33

Depomed Trademarks           Mark   Serial/Registration Numbers  GLUMETZA   Ser. No. 78340355 DEPOMED   Reg. No. 2112593 DEPOMED (word and design mark)   Ser. No. 78781903 ACUFORM   Ser. No. 78781863

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.







Schedule 1.54

King Trademarks           Mark   Serial/Registration Numbers  KING PHARMACEUTICALS   Reg. No. 2871392 KING PHARMACEUTICALS   Reg. No. 2927079 KING PHARMACEUTICALS and Design   Ser. No. 78-842125 Design Mark   Ser. No. 78-842009

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.







Schedule 1.56

Glumetza Initial Launch Plan

Market Overview

[***] affects [***] people in the US, and [***] have shown that [***]. The cost [***] or roughly [***], is spent [***] of the [***] with [***]. Of this, [***] is spent [***] that can [***] of the [***].

[***] has been well [***] to its [***] at [***] and its [***]. However, [***] have [***] frequently need [***] quickly, usually the [***]. Still, [***] per year. And although [***], there is an [***].

Product Background

Glumetza[***] a full [***]. Although the [***].

•  [***] were able to [***]

•  [***] of the [***] — significantly more than the [***]

•  Several [***]

o Less [***] than [***]

o Similar [***], but with [***]

o [***] in minimal [***]

Launch Overview

Glumetza product will be [***] the first [***] by the 2nd or 3rd [***]. The [***], which will begin [***], and such [***]. The product [***] on called [***].

Positioning

Glumetza is the [***]

> Reaching [***] is a [***] — [***] is to [***] the most [***] from [***]

> [***] various [***] that [***] in the [***]

> Represents the [***] that [***], and [***] to the [***]

Key areas of focus

1. [***]

[***]AcuFormTM as [***] factor: Glumetza [***] Depomed's AcuForm technology which is the [***] for its [***]. It has several [***] its better [***] [***]. [***]Glumetza[***] better [***] than all [***].

In [***] research, [***] onto the [***] as the reason to [***]Glumetza [***] better than [***]. Furthermore, [***] were willing [***] on how the [***] better [***].

[***] Need: [***] is commonly accepted as the [***] to its [***]. However, [***] how it [***], such as [***]. Ultimately the [***].

Our [***] on the [***]. At its [***] off a [***] for [***], even more [***].

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.







[***]Glumetza will [***], and emphasize that its [***]. [***]Glumetza[***] that demonstrates [***], and we will [***].

[***], we will apply [***] and [***] to describe [***], yet do not [***].

Glumetza[***] goal: [***] goals is [***] and Glumetza will its [***] on how it [***]. Significantly [***]Glumetza (without any [***], because Glumetza[***].

Goal [***]: Together with [***] that [***] goals, [***] plan to [***]. One idea is to [***]Glumetza[***].

[***] the [***]

[***]: Depomed has [***], to assist [***] that are [***] that is [***].

[***]: While Glumetza[***] have data that [***], where appropriate, [***].

Not only will the [***], but also will [***].

[***]: Glumetza already has [***]. We expect another [***].

[***]: Years of [***] for [***] that will [***]. Healthcare [***] will be done [***] is the [***] for which [***].

2. Point of Sale

[***]: Glumetza currently has [***]. We anticipate [***], which should [***]. We plan to [***] in order to [***].

To support the [***], we have [***]Glumetza[***] emphasizes the [***] [***] — particularly in [***].

Depomed has [***] with the [***].

[***]: Glumetza[***]. There are [***]Glumetza. We plan to [***] through various [***], as determined [***]. We will [***] to encourage [***].

Glumetza is already [***], however we are [***]Glumetza receives a [***].

[***]: We have initiated [***] that will [***] will be [***].

Other launch plans

Pricing: The [***] price range will be [***]. The pricing [***]. These [***], will further refine the price [***].

[***]: Depomed will have [***] with the [***]. The first [***] will be the [***] King Pharmaceuticals [***] to have [***] upon the [***]Glumetza.

[***]: We are preparing a Glumetza[***] that [***]Glumetza and its [***]. This [***] general [***].

[***]: [***] will be a [***] of the [***] of the [***]. While the exact [***] to be [***] have begun [***].

[***]: Glumetza will be [***].

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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[***]: [***] over the [***].

Launch [***]: [***] will take [***], with many [***]. We expect [***].

[***]: [***] during [***][***].           [***]   [***]   [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***]

[***] [***] [***] [***] [***]



[***] [***] [***] [***] [***] [***] [***] [***]

Budget: The budget for the Launch Plan will [***] with the [***]the parties [***], with the [***]of which Depomed [***] King. The parties [***] will not [***]; provided that [***] Depomed [***]and included with the [***] will determine a [***].

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

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Schedule 3.2

Depomed Initial JCC Representatives:

[***]

King Initial JCC Representatives:

[***]

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.







Schedule 4.5           Year   Advertising/Marketing/Educational Expenses 2006   $ [***]  2007   $ [***]  2008   $ [***]  2009   $ [***]  2010   $ [***]  2011   $ [***]

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.







Schedule 6.3

Volume Forecast

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.







Glumetza[***] Forecast for the 1st 12 Months after Launch                                                                                                          (000s)   Aug-06    Sep-06    Oct-06    Nov-06    Dec-06    Jan-07    Feb-07    Mar-07    Apr-07    May-07    Jun-07    Jul-07    Aug-07    Sep-07    Oct-07    Nov-07    Dec-07   Demand Fcst in [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]  Adj to Demand Fcst    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]  Ex-Factory Fcst in [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]  Projected Inventory on Hand    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]  Projected Inventory MOHs    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]    [***]           1st 12 Mths   2006   Total   Total [***]    [***]  [***]    [***]  [***]    [***]

Assumptions: Stock in Quantity: [***] [***] = [***] Wholesalsers will reduce

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934. 
Question: Highlight the parts (if any) of this contract related to Covenant Not To Sue that should be reviewed by a lawyer. Details: Is a party restricted from contesting the validity of the counterparty’s ownership of intellectual property or otherwise bringing a claim against the counterparty for matters unrelated to the contract?
64934

Exhibit 10.1

Redactions with respect to certain portions hereof denoted with ***

COLLABORATION AGREEMENT

This Collaboration Agreement (the Agreement) is made as of April 14th, 2020 (the Effective Date) by and between Anixa Biosciences, Inc., a Delaware corporation, located at 3150 Almaden Expressway, Suite 250, San Jose, CA 95118, U.S.A. (Anixa), and OntoChem GmbH, a German limited liability company, located at Blücherstr. 24, D-06120 Halle (Saale), Germany (OntoChem). Anixa and OntoChem are referred to herein individually as a Party and collectively as the Parties.

WHEREAS, the Parties wish to collaborate in the discovery and development of novel drug candidates for the treatment of COVID-19 in accordance with the terms and conditions of this Agreement.

NOW, THEREFORE, in consideration of the premises and the mutual promises set forth in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

1. Defined Terms.

1.1 Affiliate means, with respect to a Party, any entity directly or indirectly controlled by, controlling or under common control with such Party. For purposes of this definition, control means (a) ownership of fifty percent (50%) (or such lesser percentage which is the maximum allowed to be owned by a foreign entity or investor in a particular jurisdiction) or more of the outstanding voting stock or other ownership interest of an entity, or (b) possession of the power to (i) elect, appoint, direct or remove fifty percent (50%) or more of the members of the board of directors or other governing body of an entity or (ii) otherwise direct or cause the direction of the management or policies of an entity by contract or otherwise.

1.2 Hit Compound means any chemical entity that is determined in performing the Research Plan to meet the Hit Criteria.

1.3 Hit Criteria means the criteria identified as Hit Criteria as set forth in the Research Plan.

1.4 Invention means any invention, know-how, data, discovery or proprietary information, whether or not patentable, that is made or generated solely by the Representatives of Anixa or OntoChem or jointly by the Representatives of Anixa and OntoChem in performing the Research Plan, including all intellectual property rights in the foregoing.

1.5 Representative means, with respect to a Party, an officer, director, employee, agent or permitted subcontractor of such Party.

1.6 Research Plan means the research plan attached hereto as Exhibit A.

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1.7 SAR means the relationship between the chemical or three-dimensional structure of a compound and its biological activity, and includes the determination of the chemical groups responsible for evoking a target biological effect.

1.8 Target means: (a) any protease of any coronavirus, including Mpro; (b) the Nsp15-pRB ribonuclease protein- protein interaction; (c) all mutants and variants of any molecule or component referenced in clauses (a) or (b); and (d) all truncated forms (including fragments) of any molecule or component referenced in clauses (a) or (b) or mutant or variant referenced in clause (c).

1.9 Variant means, with respect to any Hit Compound: (a) all compounds within the genus of compounds to which such Hit Compound would belong under United States patent laws as referenced in the Selection Notice (as defined below); and (b) any base form, metabolite, ester, salt form, racemate, stereoisomer, polymorph, hydrate, anhydride or solvate of such Hit Compound or any other compound described in clause (a) (in the case of this clause (b), without regard to whether such compound is referenced in the Selection Notice).

2. Research Program.

2.1 Performance. The Parties will diligently perform their respective activities set forth in the Research Plan (such activities, collectively, the Research Program) in accordance with the timelines set forth therein, with the objective of identifying Hit Compounds and Lead Scaffolds that modulate the applicable Target. Without limiting the foregoing, OntoChem will (a) provide all deliverables set forth in the Research Plan (each, a Deliverable) and (b) obtain any authorizations, approvals and licenses required for performance of the Research Plan. If any terms set forth in the Research Plan conflict with the terms set forth in this Agreement, the terms of this Agreement will control unless expressly indicated to the contrary in the Research Plan. The Research Plan may not be amended without the prior written consent of both Parties. If, from time to time, the Parties desire to expand the scope of the Research Program, then they will negotiate in good faith a potential amendment of the Research Plan in regard to such expanded scope, on commercially reasonable terms, but neither Party will be obligated to enter into any such amendment.

2.2 Weekly Updates. OntoChem will provide Anixa with weekly (or more frequently as requested) updates regarding its progress under the Research Program via teleconference, videoconference or e-mail, and the Parties will make appropriate personnel available in a timely manner to discuss and provide feedback in regard to such updates.

2.3 Delivery of Data. In conjunction with each weekly update described in Section 2.2, OntoChem will deliver to Anixa all data generated under the Research Plan since the preceding update. In addition, Anixa will have the right to reasonably request additional information relating to such data, and OntoChem will respond to such requests promptly with any such additional information in its possession or control, provided that, for clarity, OntoChem will not be required to perform any new or additional research in order to generate any such additional information.

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2.4 Selection of Lead Scaffolds. Within one year following completion of all activities under the Research Plan (the Selection Deadline), Anixa, in good faith consultation with OntoChem, will have the right to select up to two hundred (200) Hit Compounds (each, a Selected Hit Compound), by providing OntoChem with written notice of such Selected Hit Compound(s) (the Selection Notice), and each Selected Hit Compound, along with all Variants of such Selected Hit Compound referenced in the Selection Notice, is hereby designated as a Lead Scaffold under this Agreement. Commencing upon selection of a Selected Hit Compound, Anixa (itself and through its Affiliates and designees) will have sole authority over and control of the further development, manufacture, and commercialization of the corresponding Lead Scaffold and any product candidate or product incorporating a compound from such Lead Scaffold. Following the Selection Deadline, Anixa will have no further rights with respect to any Hit Compound that is not a Selected Hit Compound or included within a Lead Scaffold (each, a Rejected Hit Compound), provided that, during the period of two (2) years following the Selection Deadline, neither OntoChem nor any of its Affiliates will use or disclose to any third party any Rejected Hit Compound or any Variant thereof, including the identity, structure or SAR information of any such compound, for application as anti-viral agents or protease inhibitors, for purposes of modulating any Target or for treatment of virus-related conditions. In case OntoChem finds a novel and unexpected antiviral use of those Rejected Hit Compounds during this 2-years period, it will notify Anixa about these findings and Anixa has the right of first negotiation during a period of 6 months after this notification. If Anixa decides to not license those uses or compounds for this novel antiviral use, OntoChem is free to develop those molecules further as its own intellectual property without any further restrictions.

2.5 Subcontractors. OntoChem may engage one or more subcontractors to perform its activities under the Research Plan with the prior written approval of Anixa and provided that, with respect to any such subcontractor, OntoChem will (a) be responsible and liable for the performance of such subcontractor and (b) enter into a written agreement (i) consistent with terms and conditions of this Agreement, including with respect to confidentiality and intellectual property, and (ii) prohibiting such subcontractor from further subcontracting. For clarity, vendors where commercial building blocks or compounds will be purchased are nor regarded as subcontractors.

2.6 Target Exclusivity. During the term of this Agreement, except in the performance of its obligations or exercise of its rights under this Agreement, neither OntoChem nor any of its Affiliates will discover, research, develop, manufacture or commercialize any compound or product directed to any Target, either independently or for or in collaboration with a third party (including the grant of a license to any third party), or have any of the foregoing activities performed on behalf of OntoChem or any of its Affiliates by a third party. For clarity, the foregoing includes the screening (including via computational methods) of any compound library or virtual compound library against any Target.

2.7 Records. Each Party will maintain complete and accurate records of all activities performed by or on behalf of such Party under the Research Program and all Inventions made or generated by or on behalf of such Party in the performance of the Research Program. Such records will be in sufficient detail and in good scientific manner appropriate for patent and regulatory purposes. Each Party will provide the other Party with the right to inspect such records, and upon request will provide copies of all such records, to the extent reasonably required for the exercise or performance of such other Party's rights or obligations under this Agreement, provided that any information disclosed under this Section 2.7 will be subject to the terms and conditions of Section 5. Each Party will retain such records for at least three (3) years following expiration or termination of this Agreement or such longer period as may be required by applicable law or regulation.

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2.8 Debarment. Each Party hereby represents and warrants to the other Party that neither it nor any of its Affiliates or personnel has been debarred under any health care laws or regulations and that, to its knowledge, no investigations, claims or proceedings with respect to debarment are pending or threatened against such Party or any of its Affiliates or personnel. Neither Party nor any of its Affiliates will use in any capacity, in connection with the Research Program, any person or entity who has been debarred. Each Party agrees and undertakes to promptly notify the other Party if such Party or any of its Affiliates or personnel becomes debarred or proceedings have been initiated against any of them with respect to debarment, whether such debarment or initiation of proceedings occurs during or after the term of this Agreement.

3. Financial Terms.

3.1 Research Program Payments. In consideration for OntoChem's performance of its activities under the Research Plan, Anixa will:

(a) pay OntoChem 100,002 Euros in six (6) equal installments as follows: (i) 16,667 Euros within five (5) days after the Effective Date; and (ii) five (5) installments in the amount of 16,667 Euros on each one-month anniversary of the Effective Date, except that the last such payment will be due within thirty (30) days after completion of all activities under the Research Plan; and

(b) reimburse OntoChem for its out-of-pocket expenses incurred in performing the Research Plan on a pass- through basis without mark-up, within thirty (30) days after delivery of an invoice therefore (including reasonable supporting documentation), provided that Anixa has approved such expenses in advance and in writing (including in regard to the selection of specific Hit Compounds to be synthesized and analyzed in biological assays). It is estimated that OntoChem's out-of-pocket expenses under the Research Plan will include 110,000 Euros payable to Tube Pharmaceuticals GmbH as a subcontractor of OntoChem, subject to Section 2.5.

(c) High-throughput screening compounds

OntoChem will forward a commercial proposal to acquire these compounds at the sole discretion of Anixa. Both parties will agree on payment conditions.

(d) Extra custom synthesis

OntoChem will forward a commercial proposal to have synthesized these compounds at the sole discretion of Anixa. Both parties will agree on payment conditions.

(e) Biological testing

OntoChem will forward a commercial proposal to have biologically test these compounds at the sole discretion of Anixa. Both parties will agree on payment conditions.

3.2 Lead Scaffold Payments. For each Lead Scaffold selected by Anixa, Anixa will pay OntoChem an annual fee of 10,000 U.S. Dollars, payable within thirty (30) days following each anniversary of the date of the Selection Notice, until five (5) years after the first commercial sale of the first product incorporating a compound from such Lead Scaffold, subject to Section 4.3 with respect to any Terminated Scaffold (as defined below).

3.3 Milestone Payment. Anixa will pay OntoChem a one-time milestone payment of 300,000 U.S. Dollars within thirty (30) days following the dosing of the first patient in the first human clinical trial for the first product incorporating a compound from a Lead Scaffold.

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3.4 Payment Terms. Payments to OntoChem will be made by check or by wire transfer of immediately available funds to such bank account as designated in writing by OntoChem from time to time. Taxes (and any penalties and interest thereon) imposed on any payment made by Anixa to OntoChem will be the responsibility of OntoChem. The fees for the respective bank transfers will be borne by Anixa.

3.5 Financial Records. OntoChem will maintain complete and accurate books and accounting records related to all out-of-pocket expenses incurred in performing the Research Plan. These records will be available for inspection during regular business hours upon reasonable notice by Anixa, or its duly authorized representative, at Anixa's expense, for three (3) years following the end of the calendar year in which such expenses are invoiced. If it is determined that Anixa has overpaid for any expenses passed through by OntoChem under this Agreement, OntoChem will promptly reimburse Anixa for the amount of such overpayment and, if such overpayment represents more than five percent (5%) of the corresponding amount due, OntoChem will pay Anixa's reasonable fees and expenses incurred in connection with such inspection.

4. Term and Termination.

4.1 Term. Unless earlier terminated in accordance with Section 4.2 or 4.3, this Agreement will be in effect from the Effective Date until completion of the Research Program.

4.2 Termination by Anixa. This Agreement may be terminated by Anixa, without cause, upon at least thirty (30) days written notice to OntoChem.

4.3 Termination of Lead Scaffolds. For each Lead Scaffold, if (a) neither Anixa nor any of its Affiliates, licensees or assignees has dosed the first patient in a human clinical trial for a product incorporating a compound from such Lead Scaffold by the fifth (5th) anniversary of the date of the Selection Notice, or (b) Anixa earlier provides written notice of termination of such Lead Scaffold referencing this Section 4.3, then such Lead Scaffold (each, a Terminated Scaffold) will thereupon cease to be a Lead Scaffold under this Agreement and thereafter, notwithstanding anything to the contrary in this Agreement: (i) Anixa will promptly assign to OntoChem all right, title and interest in and to any patents and patent applications owned by Anixa that claim such Terminated Scaffold (including the composition, use or manufacture thereof) and, following such assignment, OntoChem will exclusively control the filing, prosecution, maintenance and enforcement of such patents and patent applications; (ii) the identity, structure and SAR information of such Terminated Scaffold will be deemed to be the Confidential Information of OntoChem; (iii) Anixa will not owe any further annual fees under Section 3.2 for such Terminated Scaffold; and (iv) this Agreement will otherwise remain in full force and effect.

4.4 Termination for Cause. This Agreement may be terminated by either Party for material breach by the other Party, provided that the terminating Party has given the breaching Party written notice of the breach and at least sixty (60) days to cure the breach prior to the effective date of termination.

4.5 Effects of Termination. Promptly following expiration or termination of this Agreement, OntoChem will provide Anixa with an invoice (including reasonable supporting documentation) for any pre-approved out-of-pocket expenses (including non- cancellable commitments) incurred by OntoChem in performing the Research Plan and not yet reimbursed by Anixa, and Anixa will pay such invoice within thirty (30) days after receipt thereof. In addition, if this Agreement is terminated prior to completion of the Research Program, OntoChem will promptly furnish to Anixa any Deliverable or other work product generated to date and not previously provided to Anixa, including work in process.

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4.6 Survival. Expiration or termination of this Agreement will not affect the rights and obligations of the Parties that accrued prior to the effective date of such expiration or termination. The following provisions will remain in effect following expiration or termination of this Agreement and the Parties will continue to be bound thereby: Sections 2.4 (last three sentences), 2.7, 2.8 (last sentence only), 3.2, 3.3, 3.4, 3.5, 4.5, 4.6, 5, 6, 8 and 9.

5. Confidentiality.

5.1 Definition. Confidential Information means any information disclosed (directly or indirectly) by a Party (in such capacity, Discloser) to the other Party (in such capacity, Recipient) in connection with this Agreement whether in written, graphic, electronic, tangible or any other form. Confidential Information will not, however, include any information that: (a) was publicly known or generally available to the public prior to the time of disclosure by Discloser to Recipient; (b) becomes publicly known or generally available to the public after disclosure by Discloser to Recipient through no wrongful action or inaction of Recipient; (c) is in the rightful possession of Recipient without confidentiality obligations at the time of disclosure by Discloser to Recipient as shown by Recipient's then-contemporaneous written files and records kept in the ordinary course of business; (d) is obtained by Recipient from a third party without an accompanying duty of confidentiality and without (to Recipient's knowledge) a breach of such third party's obligations of confidentiality; or (e) is independently developed by Recipient without use of or reference to Discloser's Confidential Information. Notwithstanding anything to the contrary in this Agreement, except as expressly provided in Section 4.3 with respect to a Terminated Scaffold, the identity, structure and SAR information of: (i) the Hit Compounds will be deemed to be the Confidential Information of both Parties until the Selection Deadline, provided that, during such period, Anixa (itself or through one or more third party service providers on its behalf under a written agreement consistent with terms and conditions of this Agreement, including with respect to confidentiality and intellectual property) may perform biological assays and other analyses to evaluate the Hit Compounds solely for purposes of selecting Lead Scaffolds pursuant to Section 2.4; (ii) the Lead Scaffolds will be deemed to be Anixa's Confidential Information commencing upon the date of the Selection Notice; (iii) the Rejected Hit Compounds will be deemed to be OntoChem's Confidential Information commencing upon the date of the Selection Notice, subject to the last sentence of Section 2.4.

5.2 Non-Use and Non-Disclosure. Neither Party will use any Confidential Information of the other Party for any purpose except as reasonably necessary to fulfill its obligations or exercise its rights under this Agreement. Neither Party will disclose any Confidential Information of the other Party nor permit any such Confidential Information to be disclosed, either directly or indirectly, to any third party or its personnel without the other Party's prior written consent, except as expressly permitted hereunder. Each Party may disclose Confidential Information of the other Party to its Representatives who are required to have the information in order for such Party to fulfill its obligations or exercise its rights under this Agreement, provided that such Representatives are subject to legally binding non-use and non-disclosure obligations consistent with this Agreement, prior to any disclosure of Confidential Information to such Representatives. If Recipient becomes legally compelled to disclose any Confidential Information of Discloser, Recipient will provide Discloser prompt written notice of such disclosure obligation, if legally permissible, and upon request will reasonably assist Discloser in seeking a protective order or other appropriate remedy. If Discloser waives Recipient's compliance with this Agreement or fails to obtain a protective order or other appropriate remedy, Recipient will furnish only that portion of the Confidential Information that is legally required to be disclosed, provided that any Confidential Information so disclosed will maintain its confidentiality protection for all purposes other than such legally compelled disclosure.

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5.3 Maintenance of Confidentiality. Recipient will take commercially reasonable measures to protect the secrecy of and avoid disclosure and unauthorized use of the Confidential Information of Discloser. Without limiting the foregoing, Recipient will take at least those measures that it employs to protect its own confidential information of a similar nature. Recipient will promptly notify Discloser in writing of any unauthorized use or disclosure, or suspected unauthorized use or disclosure, of Discloser's Confidential Information of which Recipient becomes aware.

5.4 Confidential Terms. Except as otherwise required by applicable law or regulation, neither Party will disclose the existence or terms of this Agreement to any third party without the prior written consent of the other Party, except that (a) each Party may disclose this Agreement or its terms to its advisors and to existing and potential investors, acquirers, lenders and, in the case of Anixa, licensees on a reasonable need-to-know basis under circumstances that reasonably ensure the confidentiality thereof, and (b) Anixa may issue press releases, make investor and other public presentations and post content on its website from time to time regarding the existence and terms of this Agreement and progress regarding the development, manufacture and commercialization of Lead Scaffolds (including the identity of any permitted subcontractors under this Agreement), to the extent deemed appropriate for purposes of investor relations in its capacity as a publicly traded company and compliance with securities laws and regulations.

5.5 Equitable Relief. Recipient agrees that any violation or threatened violation of this Article 5 may cause irreparable injury to Discloser, entitling Discloser to seek to obtain injunctive relief in addition to all legal remedies without showing or proving any actual damage and without any bond required to be posted.

5.6 Return of Confidential Information. Upon expiration or termination of this Agreement, or upon written request, each Party will promptly return to the other Party, or upon written request of such other Party destroy, all materials containing such other Party's Confidential Information, provided, however, that the Recipient may retain in confidence (a) one archival copy of the Confidential Information of the Discloser in its legal files solely to permit the Recipient to determine compliance with this Agreement and (b) any portion of the Confidential Information of the Discloser which the Recipient is required by applicable law or regulation to retain. Notwithstanding the return or destruction of the materials described above, the Parties will continue to be subject to the terms of this Section 5.

6. Intellectual Property.

6.1 Background Intellectual Property. All inventions, know-how, data, discoveries and proprietary information, including all intellectual property rights in the foregoing, owned or controlled by a Party as of immediately prior to the Effective Date are and will remain the sole property of such Party.

6.2 Inventions Owned by OntoChem. OntoChem will own, and Anixa hereby assigns to OntoChem, all right, title and interest in and to all Inventions directed to (a) any methods of generating or screening compound libraries and (b) the Rejected Hit Compounds (including the composition, use or manufacture thereof), in the case of this clause (b), effective as of the Selection Deadline (collectively (clauses (a) and (b)), OntoChem Inventions). As between the Parties, OntoChem will exclusively control the filing, prosecution, maintenance and enforcement of any patents and patent applications claiming OntoChem Inventions.

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6.3 Inventions Owned by Anixa. Anixa will own, and OntoChem hereby assigns to Anixa, all right, title and interest in and to all Inventions other than OntoChem Inventions, including, for clarity, Inventions directed to the Lead Scaffold(s) (including the composition, use or manufacture thereof) (collectively, Anixa Inventions). As between the Parties, Anixa will exclusively control the filing, prosecution, maintenance and enforcement of any patents and patent applications claiming Anixa Inventions.

6.4 License Grant. OntoChem hereby grants to Anixa a non-exclusive, fully paid-up, royalty-free, perpetual, irrevocable, transferable, worldwide license (with the right to grant and authorize sublicenses through multiple tiers) under any patents which OntoChem or any of its Affiliates own or control during the term of this Agreement, to make, have made, use, sell, offer for sale and import the Lead Scaffold(s) and products that incorporate compounds from the Lead Scaffold(s). OntoChem will not incorporate any invention, discovery or other proprietary information owned by any third party into any Anixa Inventions or Deliverables without Anixa's prior written consent.

6.5 Invention Disclosure and Implementation. Each Party will notify the other Party promptly in writing of each Invention made or generated by such Party. The determination of inventorship with respect to all Inventions will be made in accordance with United States patent law. Each Party will assign, and does hereby assign, to the other Party rights with respect to the applicable Inventions as necessary to achieve ownership as provided in Sections 6.2 and 6.3. Each assigning Party will execute and deliver all documents and instruments reasonably requested by the other Party to evidence or record such assignment or to file for, perfect or enforce the assigned rights. Each assigning Party will make its relevant Representatives (and their assignments and signatures on such documents and instruments) reasonably available to the other Party for assistance in accordance with this Section 6.5 at no charge. However, out of pocket expenses such as travel or communication costs shall be reimbursed. Each Party will have the sole right to file and prosecute patent applications claiming any Inventions of which such Party is the sole owner pursuant to this Agreement without the consent of the other Party, and such other Party will provide, and will cause its Representatives to provide, reasonable cooperation and assistance with such filing and prosecution upon request. To the extent OntoChem is obligated by reason of mandatory provisions of the Gesetz über Arbeitnehmererfindungen (ArbNErfG) (German law covering employee inventions) to make payments to its employees, OntoChem will be solely responsible, and indemnify Anixa, for any and all such payments to OntoChem's employees.

6.6 No Implied Rights. Except as otherwise expressly provided herein, nothing in this Agreement is intended to grant to either Party any rights under any intellectual property right of the other Party.

7. Representations and Warranties.

7.1 Mutual Representations and Warranties. Each Party hereby represents and warrants to the other Party that: (a) it is duly organized, validly existing, and in good standing under the laws and regulations of the jurisdiction in which it is organized; (b) it has the requisite power and authority and the legal right to enter into this Agreement and to perform its obligations hereunder; (c) it has taken all requisite action on its part to authorize the execution and delivery of this Agreement and the performance of its obligations hereunder; (d) this Agreement has been duly executed and delivered by such Party and constitutes a legal, valid and binding obligation of such Party, enforceable against such Party in accordance with its terms; and (e) the execution, delivery and performance of this Agreement by it do not conflict with any agreement, instrument or understanding, oral or written, to which it is a party, or to which it is bound, and it will not enter into any agreement, instrument or understanding, oral or written, that conflicts with the rights and obligations of this Agreement during the term of this Agreement.

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7.2 Additional Representations and Warranties of OntoChem. OntoChem hereby further represents and warrants to Anixa that: (a) to OntoChem's knowledge, OntoChem's performance of its activities under the Research Plan does not infringe or constitute misappropriation of the intellectual property rights of any third party; (b) no licenses, permissions or releases from any third party are necessary for OntoChem's performance of its activities under the Research Plan; (c) OntoChem has obtained rights to use any third-party compound libraries and software referenced in the Research Plan under terms and conditions consistent with this Agreement; and (d) OntoChem's performance of its activities under the Research Plan will not result in any third party acquiring any right, title or interest in or to any Anixa Invention or Deliverable.

7.3 Mutual Covenants. Each Party hereby covenants that: (a) all Representatives of such Party who participate in the performance of the activities contemplated by this Agreement will be subject to written obligations regarding the treatment of Confidential Information and the assignment of Inventions that are consistent with such Party's obligations under this Agreement, as of the commencement of such activities by such Representatives; and (b) such Party will comply with applicable laws and regulations in connection its performance of this Agreement.

8. Indemnification and Insurance.

8.1 Indemnification by Anixa. Anixa will indemnify, defend and hold harmless OntoChem, its Affiliates and their respective Representatives from and against any liability, demand, damage, cost or expense (including reasonable attorney's fees) arising from any third-party claim, action or proceeding arising from (a) Anixa's breach of this Agreement or (b) Anixa's negligence or willful misconduct in connection with this Agreement, except with respect to any matter for which OntoChem is obligated to provide indemnification under Section 8.2.

8.2 Indemnification by OntoChem. OntoChem will indemnify, defend and hold harmless Anixa, its Affiliates and their respective Representatives from and against any liability, demand, damage, cost or expense (including reasonable attorney's fees) arising from any third-party claim, action or proceeding arising from (a) OntoChem's breach of this Agreement or (b) OntoChem's negligence or willful misconduct in connection with this Agreement, except with respect to any matter for which Anixa is obligated to provide indemnification under Section 8.1. Financial reimbursements claimed according to such indemnification shall not exceed payments received by OntoChem under this contract.

8.3 Indemnification Procedure. A Party (the Indemnitee) that intends to claim indemnification under this Section 8 will promptly notify the other Party (the Indemnitor) in writing of any claim, action or proceeding in respect of which the Indemnitee intends to claim such indemnification (each a Claim), and the Indemnitor will have the right to control the defense and/or settlement of such Claim, provided that the Indemnitee will have the right to participate, at its own expense, with counsel of its own choosing in the defense and/or settlement of such Claim. The Indemnitor will not, without the prior written consent of the Indemnitee, enter into any settlement or agree to any disposition of the applicable Claim that imposes any conditions or obligations on the Indemnitee. The failure to deliver written notice to the Indemnitor within a reasonable period of time after the commencement of any such Claim will not relieve such Indemnitor of any liability to the Indemnitee under this Section 8 except to the extent such failure is prejudicial to the Indemnitor's ability to defend such Claim. The Indemnitee and its Representatives, at the Indemnitor's request and expense, will provide full information and reasonable assistance to the Indemnitor and its legal representatives with respect to the applicable Claim subject to indemnification. It is understood that only a Party may claim indemnification under this Section 8 (on its own behalf or on behalf of its Affiliates or their respective Representatives), and such Party's Affiliates and their respective Representatives may not directly claim indemnification hereunder.

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8.4 Insurance. Each Party will maintain liability insurance, with reputable and financially secure insurance carriers, at levels consistent with industry standards based upon such Party's respective activities and indemnification obligations under this Agreement. Upon request, each Party will furnish to the other Party certificates issued by the applicable insurance company(ies) evidencing such insurance.

9. Miscellaneous.

9.1 Relationship of the Parties. The Parties are independent contractors and nothing contained in this Agreement will be construed to place them in the relationship of partners, principal and agent, employer/employee or joint venturer. Neither Party will have the power or right to bind or obligate the other Party, nor will either Party hold itself out as having such authority.

9.2 Use of Name. Neither Party will use the name, logo or trademark of the other Party in any advertising, publicity or other promotional activities without such other Party's prior written consent, unless such use is reasonably necessary to comply with applicable laws or regulations and subject to clause (b) of Section 5.4.

9.3 Notices. Any notice required or permitted to be given under this Agreement by either Party will be in writing (in English) and will be delivered to the applicable Party at its respective address set forth below by personal delivery, e-mail, reputable international courier or registered or certified mail. Notices will be deemed given on the date received if delivered personally, on the next business day if sent by e-mail or international courier, or five (5) days after the date postmarked if sent by registered or certified mail, return receipt requested, postage prepaid.

If to OntoChem: OntoChem GmbH Blücherstr. 24, D-06120 Halle (Saale) Germany Attention: Chief Executive Officer E-mail: lutz.weber@ontochem.com

If to Anixa: Anixa Biosciences, Inc. 3150 Almaden Expressway, Suite 250 San Jose, CA 95118 U.S.A. Attention: Chief Executive Officer E-mail: ak@anixa.com 10





9.4 Governing Law. This Agreement and the rights and obligations of the Parties hereunder will be governed by the laws of the State of Delaware without regard to the conflict of laws provisions of any jurisdiction. The Parties agree that the 1980 United Nations Convention on Contracts for the International Sale of Goods shall not apply to this Agreement.

9.5 Arbitration. The Parties agree that any dispute arising out of, or in connection with, this Agreement, which cannot be amicably resolved between the Parties, will be finally settled by binding arbitration under the then current rules of the International Chamber of Commerce (ICC) by one (1) arbitrator appointed in accordance with ICC rules. Any such arbitration will be conducted in English in the State of Delaware. The arbitrator may grant injunctive or other relief in such dispute or controversy. The decision of the arbitrator will be final, conclusive and binding on the Parties. Judgment may be entered on the arbitrator's decision in any court of competent jurisdiction. The costs of the arbitration, including administrative and arbitrator's fees, will be shared equally by the Parties. Each Party will bear the cost of its own attorneys' fees and expert witness fees. Notwithstanding anything to the contrary in this Agreement, a Party may seek a temporary restraining order or a preliminary injunction from any court of competent jurisdiction in order to prevent immediate and irreparable injury, loss or damage on a provisional basis, pending the selection of the arbitrator or pending the arbitrator's determination of the merits of any dispute pursuant to this Section 9.5.

9.6 Severability. If any one or more provisions of this Agreement will be found to be invalid or unenforceable in any respect, the Parties will negotiate in good faith a valid and enforceable substitute provision that most nearly reflects the original intent of the Parties, and the validity and enforceability of the remaining provisions of this Agreement will not in any way be affected or impaired thereby.

9.7 Amendment; Waiver. This Agreement may be amended or modified, and any of the terms of this Agreement may be waived, only by a written instrument executed by each Party or, in the case of waiver, by the Party or Parties waiving compliance. The delay or failure of either Party at any time or times to require performance of any provision will in no manner affect its rights at a later time to enforce the same. No waiver by either Party of any condition or of the breach of any term contained in this Agreement, in any one or more instances, will be deemed to be, or considered as, a further or continuing waiver of any such condition or of the breach of such term or any other term of this Agreement.

9.8 Assignment. Neither Party may assign or otherwise transfer this Agreement (or any of its rights or obligations hereunder) without the prior written consent of the other Party, except that either Party may assign this Agreement without such consent to an entity that acquires all or substantially all of the business or assets of such Party to which this Agreement relates, whether by merger, consolidation, sale of assets or otherwise. Any assignment or transfer of this Agreement in violation of this Section 9.8 will be null and void. This Agreement will bind and inure to the benefit of the Parties and their respective successors and permitted assigns.

9.9 Entire Agreement. This Agreement represents the complete and entire understanding between the Parties regarding the subject matter hereof and supersedes all prior negotiations, representations or agreements, either written or oral, regarding such subject matter.

9.10 Counterparts. The Parties may execute this Agreement in multiple counterparts, all of which together will constitute one instrument. Signatures to this Agreement delivered by facsimile or other electronic transmission (e.g., portable document format (PDF)) will be deemed to be binding as original signatures.

(The remainder of this page is intentionally left blank. The signature page follows.)





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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date.





ANIXA BIOSCIENCES, INC. ONTOCHEM GMBH

By: /s/ Amit Kumar By: /s/ Lutz Weber Amit Kumar, Ph.D. Name: Dr. Lutz Weber President and Chief Executive Officer Title: CEO 12





Exhibit A: Research Plan

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Question: Highlight the parts (if any) of this contract related to Insurance that should be reviewed by a lawyer. Details: Is there a requirement for insurance that must be maintained by one party for the benefit of the counterparty?

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