Document:

<PAGE>

                             SUPPLEMENTAL INDENTURE

         SUPPLEMENTAL INDENTURE dated as of July 6, 2005, between Impax
Laboratories, Inc., a Delaware corporation (hereinafter called the "COMPANY"),
having its principal office at 3735 Castor Avenue, Philadelphia, Pennsylvania
19124, and HSBC Bank USA, National Association, a national banking association,
as trustee (hereinafter called the "TRUSTEE").

                              W I T N E S S E T H:

         WHEREAS, the Company has duly authorized and issued its 3.5%
Convertible Senior Subordinated Debentures Due 2012 (hereinafter called the
"DEBENTURES"), in the aggregate principal amount of $75,000,000 and, to provide
the terms and conditions upon which the Debentures were authenticated, issued
and delivered, the Company duly authorized and entered into an Indenture dated
as of June 27, 2005, between the Company and the Trustee (the "INDENTURE"); all
capitalized terms used and not otherwise defined herein shall have the
respective meanings ascribed to such terms in the Indenture; and

         WHEREAS, the Average Closing Price has been calculated, the Make-Whole
Premium Table has been finalized, and each has been agreed upon by the Company
and the Holders of the Debentures and, in accordance with and pursuant to
Section 12.01(h) of the Indenture, the Company desires to enter into this
Supplemental Indenture for the purpose of making provision for the Initial
Supplemental Indenture Matters; and

         WHEREAS, all acts and things necessary to make this Supplemental
Indenture, when executed by the Company and the Trustee, as in the Indenture
provided, the valid, binding and legal obligations of the Company, and to
constitute this Supplemental Indenture a valid agreement according to its terms,
have been done and performed, and the execution of this Supplemental Indenture
has in all respects been duly authorized;

         NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE WITNESSETH:

         That in order to make provision for the Initial Supplemental Indenture
Matters, and in consideration of the premises set forth herein, the Company
covenants and agrees with the Trustee for the equal and proportionate benefit of
the respective Holders from time to time of the Debentures, as follows:

         Section 1.01. Average Closing Price. Pursuant to clause (x) of Section
5.01(c) of the Indenture, the Average Closing Price is calculated to be $15.919.

         Section 1.02. Make - Whole Premium. Pursuant to clause (y) of Section
5.01(c) of the Indenture, Exhibit B to the Indenture is hereby replaced by
Exhibit B to this Supplemental Indenture, which constitutes the Make-Whole
Premium Table under the Indenture.
<PAGE>

         Section 1.03. Effect of Supplemental Indenture. Except as set forth
herein, the Indenture shall remain in full force and effect, and remains the
valid, binding, and legal obligation of the Company and the Trustee, as modified
hereby.

         Section 1.04. Governing Law. This Supplemental Indenture shall be
deemed to be a contract made under the laws of the State of New York, and for
all purposes shall be construed in accordance with the laws of the State of New
York, without regard to conflicts of laws principles thereof.

         Section 1.05. Execution In Counterparts. This Supplemental Indenture
may be executed in any number of counterparts, each of which shall be an
original, but such counterparts shall together constitute but one and the same
instrument.

         Section 1.06. The Trustee. The recitals contained herein shall be taken
as the statements of the Company and the Trustee assumes no responsibility for
their correctness. The Trustee makes no representations as to the validity or
sufficiency of this Supplemental Indenture, or as to the calculations of the
Average Closing Price and the figures set forth in the Make-Whole Premium Table.

                            [SIGNATURE PAGE FOLLOWS]

                                       2

<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed.

                              IMPAX LABORATORIES, INC.

                              By: /s/ Barry R. Edwards
                                  ------------------------------------------
                                  Barry R. Edwards
                                  Chief Executive Officer

                              HSBC BANK USA, NATIONAL ASSOCIATION, as Trustee

                              By: /s/ Frank Godino
                                  ------------------------------------------
                                  Name: Frank Godino
                                  Title: Vice President

                                       3
<PAGE>
                                    EXHIBIT B

                            MAKE-WHOLE PREMIUM TABLE
<TABLE>
<CAPTION>
                                                                     Stock Price
Effective  ------------------------------------------------------------------------------------------------------------------------
  Date     $15.92  $17.00 $18.00  $19.00  $20.00  $22.50  $25.00  $27.50 $30.00  $35.00 $40.00 $45.00  $50.00  $55.00 $60.00 $65.00
---------  ------  ------ ------  ------  ------  ------  ------  ------ ------  ------ ------ ------  ------  ------ ------ ------
<S>        <C>     <C>    <C>     <C>     <C>     <C>     <C>     <C>    <C>     <C>    <C>    <C>     <C>     <C>    <C>    <C>
7/1/2005    14.50   12.67  11.29   10.14   9.17    7.34    6.08    5.16   4.46    3.46   2.78   2.28    1.89    1.58   1.33   1.12
7/1/2006    14.50   12.38  10.89    9.67   8.65    6.79    5.54    4.66   4.01    3.10   2.49   2.05    1.70    1.43   1.20   1.02
7/1/2007    14.50   12.11  10.47    9.14   8.06    6.14    4.92    4.09   3.50    2.69   2.17   1.78    1.49    1.25   1.06   0.90
7/1/2008    14.50   11.70   9.84    8.39   7.24    5.31    4.16    3.42   2.90    2.22   1.79   1.48    1.24    1.05   0.89   0.76
7/1/2009    14.50   10.50   8.36    7.11   6.11    4.36    3.31    2.65   2.21    1.68   1.35   1.12    0.94    0.80   0.68   0.59
7/1/2010    14.50   9.48    7.68    6.25   5.13    3.28    2.28    1.72   1.40    1.05   0.85   0.71    0.60    0.51   0.44   0.38
7/1/2011    14.50   9.28    7.00    5.23   3.87    1.84    0.97    0.62   0.47    0.36   0.30   0.25    0.21    0.18   0.16   0.14
7/1/2012     0.00   0.00    0.00    0.00   0.00    0.00    0.00    0.00   0.00    0.00   0.00   0.00    0.00    0.00   0.00   0.00
</TABLE>EX-10.48.1

 

Exhibit 10.48.1

AGREEMENT

dated: 1st July 2005

between

VERNALIS DEVELOPMENT LIMITED

and

ENDO PHARMACEUTICALS INC

re.

CO-PROMOTION OF FROVATRIPTAN IN U.S.A.

The confidential portions of this exhibit have been filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 of the Securities and Exchange Act of 1934, as amended.
REDACTED PORTIONS OF THIS EXHIBIT ARE MARKED BY AN ***.

 

 

2

 

CONTENTS

	 	 	 	 	 	 	 
	Clause	 	Description	 	Page
	1.

	 	Definitions
	 	 	1	 
	2.

	 	Grants of Rights
	 	 	4	 
	3.

	 	Responsibilities of Vernalis
	 	 	5	 
	4.

	 	Responsibilities of Endo
	 	 	10	 
	5.

	 	Training, Marketing Materials and Non-Hiring of Employees
	 	 	11	 
	6.

	 	Certain Regulatory Matters
	 	 	12	 
	7.

	 	Joint Co-Promotion Team
	 	 	14	 
	8.

	 	Recordkeeping and Audits
	 	 	17	 
	9.

	 	Term and Termination
	 	 	18	 
	10.

	 	Confidentiality
	 	 	20	 
	11.

	 	Indemnification and Insurance; Limitation of Liability
	 	 	20	 
	12.

	 	Representations and Warranties
	 	 	21	 
	13.

	 	Notices
	 	 	21	 
	14.

	 	Entire Agreement
	 	 	21	 
	15.

	 	Miscellaneous Provisions
	 	 	22	 
	 
	 	 	 	 	 	 
	Exhibits	 	 	 	 
	 
	 	 	 	 	 	 
	A

	 	Example of Vernalis Detail Report	 	 	 	 
	 
	 	 	 	 	 	 
	B

	 	Sample Schedule of Phase One Training	 	 	 	 
	 
	 	 	 	 	 	 
	C

	 	Allocation of call plan	 	 	 	 
	 
	 	 	 	 	 	 
	D

	 	Specialty Sales Representative Hiring Profile	 	 	 	 

 

 

CO-PROMOTION AGREEMENT

     This CO-PROMOTION AGREEMENT (this “Agreement”) is entered into and effective as of this
1st day of July, 2005 (the “Effective Date”), by and between ENDO PHARMACEUTICALS INC.,
a Delaware corporation whose principal place of business is at 100 Endo Boulevard, Chadds Ford, PA
19317, USA (together with its Affiliates, “Endo”), and VERNALIS DEVELOPMENT LTD., a company
organized under the laws of England and Wales whose principal place of business is at Oakdene
Court, 613 Reading Road, Winnersh, Wokingham, RG41 5UA, England (“Vernalis”).

RECITALS

     WHEREAS, Vernalis granted to Endo a sole and exclusive license to Commercialise its product
known as frovatriptan in the Territory by way of a License Agreement dated July 14, 2004 (the
“License”) as and to the extent more particularly set forth in the License;

     WHEREAS, Endo is engaged in the business of and has expertise in, among other things, the
promotion to physicians of pharmaceutical products;

     WHEREAS, the License provides Vernalis certain rights to Commercialise (and in particular to
co-promote) the Product in the USA in accordance with the terms set forth in the License and such
additional terms as may be agreed between the parties;

     WHEREAS, Vernalis has exercised its option to co-promote Product in the USA, and Endo and
Vernalis desire to work together to promote the Product in the USA upon the terms and conditions
set forth herein;

     WHEREAS, the parties wish to set forth in this Agreement the detailed terms and conditions to
govern such co-promotion and to amend, restate and supercede Article 9 and Schedule 10 of the
License and make the other specific amendments to the License explicitly stated in Section 11, but
otherwise leave the License (and that certain Safety Agreement, Loan Agreement and Security
Agreement between the Parties in connection with the License) unaffected.

     NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth in this
Agreement, and for other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto agree as follows:

1. Definitions. Capitalized terms used herein shall have the meanings specified in this
Section 1 (such definitions to be equally applicable to both the singular and plural forms of the
terms defined). Other capitalized terms used in this Agreement, unless otherwise set forth in this
Section 1, shall have the meanings set forth in the License.

     “Act” shall mean the United States Federal Food, Drug and Cosmetic Act, as it may be amended
from time to time.

 

 

     “Agreement” means this Agreement, together with all appendices, exhibits and schedules
referenced herein or attached hereto, and as the same may be amended or supplemented from time to
time hereafter pursuant to the provisions hereof.

     “Annual Co-Promotion Plan” shall mean a written sales plan relating to the sales and promotion
of the Product in the USA by Endo sales representatives and Vernalis Specialty Sales Personnel as
annually prepared by the Joint Co-Promotion Team.

     “Audited Party” shall have the meaning set forth in Section 8.2(a).

     “Auditing Party” shall have the meaning set forth in Section 8.2(a).

     “Endo Copyright” means copyright or any other intellectual property analogous to copyright
including any rights in designs subsisting or relating to any Documents, designs or other
embodiments of the trade dress for the Product, any form of advertisement in whatever media,
Marketing Materials, sales training materials, samples or other promotional gifts or any other
materials in which such rights are capable of subsisting as a matter of law in all cases which are
generated by or upon behalf of Endo or its Affiliates during the period of this Agreement in
connection with the advertising, promotion, marketing or sale or other Commercialization of
Product.

     “Endo Trademarks” means (i) the name and mark ENDO and the associated Endo logo, and (ii) any
other trademarks other than the Vernalis Trademarks used, owned by or licensed to Endo in relation
to the Product (including without limitation the MAM Product (if and when it receives Marketing
Authorization)). This definition shall not be read to modify in any way Section 13.1 of the
License. 

     “FDA” means the United States Food and Drug Administration or any successor entity thereto.

     “Governmental or Regulatory Authority” shall mean any U.S. court, tribunal, arbitrator,
agency, commission, official or other instrumentality of any federal, state, county, city or other
political subdivision thereof.

     “Initial Term” shall have the meaning set forth in Section 9.1.

     “Joint Co-Promotion Team” shall have the meaning set forth in Section 7.

     “License” means the License Agreement dated as of July 14, 2004 between Endo and Vernalis.

     “Marketing Materials” shall have the meaning set forth in Section 5.3.

     “Non-Serious Adverse Event” shall mean any adverse drug experience associated with the use of
the Product in humans, whether or not considered drug-related, which is not a Serious Adverse
Event.

2

 

     “PDMA” shall mean the Prescription Drug Marketing Act, as amended, and the implementing rules
and regulations thereunder.

     “Person” shall mean an individual, corporation, partnership, limited liability company, trust,
business trust, association, joint stock company, joint venture, pool, syndicate, sole
proprietorship, unincorporated organization, governmental authority, or any other form of entity
not specifically listed herein.

     “Phase One Training” shall mean a Product training program (including compliance training)
designed by Endo and provided to sales representatives, a sample of which is set forth in Exhibit B
hereto. Phase One Training may include sales force automation training if so requested by Vernalis
and if Vernalis uses the same sales force automation system as Endo.

     “Product” shall have the meaning set forth in the License.

     “Product Details” shall mean face-to-face contacts by a sales representative with a Target
Healthcare Professional for the purpose of discussing information about the Product.

     “Product Technical Complaint” or “PTC” shall mean any complaint that questions the purity,
identity, potency or quality of the Product, its packaging or labeling or the compliance of any
batch of the Product with applicable laws, including the Act, and current Good Manufacturing
Practice; any complaint that concerns any incident that causes the Product or its labeling to be
mistaken for, or applied to, another article; any bacteriological contamination or significant
chemical, physical or other change or deterioration in the Product; any failure of one or more
batches of the Product to meet the specifications therefor in the NDA; or any complaint or evidence
of tampering with the Product.

     “Product Trademarks” shall mean the Vernalis Trade Marks, including without limitation the
trademark Frova® associated with the Product, any other related trademark or service mark
containing the word “Frova” and any other trademark or service mark (whether registered or
unregistered) currently used on or with the Product or in any Marketing Material in the U.S. and
its territories.

     “Safety Agreement” shall mean the Safety Data Exchange Agreement version 12 August 2004
entered into between Endo Pharmaceuticals Inc. and Vernalis Development Ltd.

     “Specialty Sales Personnel” shall have the meaning set forth in the License for Vernalis
Specialty Sales Force

     “Target Healthcare Professionals” shall mean medical professionals with prescribing or
dispensing authority and who practice in the medical specialties set forth on Exhibit C, as may be
amended by agreement of the Parties from time to time.

     “Term” shall have the meaning set forth in Section 9.1.

3

 

     “USA” shall mean the United States of America and its territories.

     “Vernalis Detail Report” shall have the meaning set forth in Section 3.2.

     “Vernalis Detailing Services” shall have the meaning set forth in Section 3.1(a).

2. Grants of Rights.

     2.1 Co-Promotion Rights.

          a. Endo hereby grants to Vernalis, together with Endo, and to the extent, if any, that
Vernalis does not already have the right to do so under the License given the rights it has
retained thereunder, the right to promote the Product in the USA during the Term subject to the
terms and conditions set forth in this Agreement. 

          b. The promotion rights granted to Vernalis herein shall not prevent Vernalis from promoting
other products in the USA. The Parties agree that during the time in which Vernalis is
co-promoting the Product in the USA, the Specialty Sales Personnel shall have the right to detail
other products in addition to the Product provided that such other products are not (x) for the
treatment of migraine or post herpetic neuralgia or (y) in direct competition in the USA with
products in other therapeutic areas that are being Commercialised by Endo or are in Phase III
Clinical Trial or have completed clinical proof of principle by Endo.

     2.2 Rights to Trademarks and Copyrights.

          a. Licenses.

               (i) Endo hereby grants to Vernalis a non-exclusive, royalty-free license to use the Endo
Trademarks and Endo Copyright solely in connection with performing its obligations and exercising
its rights to co-promote the Product pursuant to the terms and conditions of this Agreement.

          b. Required Use and Compliance.

               (i) Except for the use of the Endo Trademarks and Endo Copyright in labeling, package inserts,
Product monographs, packaging for Products, and Marketing Materials, each party shall promote the
Product only under the Product Trademarks. To avoid any doubt, the Vernalis Specialty Sales
Personnel are permitted to use business cards indicating their association with Vernalis and
bearing any trademark or tradename of Vernalis and are permitted in their Product promotion to
refer to their association with Vernalis.

               (ii) To the extent Vernalis makes any use of the Endo Trademarks in writing other than in a
writing provided by Endo, Vernalis shall ensure that each use of the Endo Trademarks in writing is
accompanied by an acknowledgement that the Endo Trademarks are owned by Endo. Vernalis shall not
(A) use the Endo Trademarks in a way that might materially prejudice their distinctiveness or
validity or

4

 

the goodwill of Endo therein, or (B) use in its Product-related activities any trademarks or
tradenames so resembling any of the Endo Trademarks as to be likely to cause confusion or
deception.

          c. Notice of Infringement— Endo Trademarks.

               (i) Vernalis shall give Endo prompt notice of any infringement or threatened infringement of
which it becomes aware of any of the Endo Trademarks used in connection with the Product in the
USA.

               (ii) Endo shall determine in its sole discretion what action, if any, to take in response to
the infringement or threatened infringement of any Endo Trademark. The costs of any such action in
response to the infringement or threatened infringement in the USA shall be borne solely by Endo.
Endo shall keep Vernalis informed of such action and shall use reasonable efforts to advise
Vernalis to the extent such action impacts or affects the Vernalis Specialty Sales Personnel’s
Product promotion in the USA.

          d. Notice of Infringement — Product Trademarks. The parties rights and obligations as
regards infringement of the Product Trademarks are as set forth in Clauses 13.7 — 13.11 of the
License.

3. Responsibilities of Vernalis.

     3.1 Promotion by Vernalis.

          a. Commencing after January 1, 2006 and by January 31, 2006, and continuing throughout the
Term, Vernalis shall promote the Product to Target Healthcare Professionals in the USA in
accordance with the then-current Annual Co-Promotion Plan (collectively, the “Vernalis Detailing
Services”). The targeting and frequency of Product Details to be provided by Vernalis will be
determined by the Joint Co-Promotion Team. 

          b. By January 31, 2006, Vernalis shall have hired and shall thereafter maintain a sales force
of Specialty Sales Personnel detailing the Product in the USA to Target Healthcare Professionals,
and such sales force shall complete the number of Product Details specified in the then current
Annual Co-Promotion Plan, not to exceed the maximum number of details set forth in Clause 9.1.2 of
the License, in each calendar year during the Term. All Product Details made by Vernalis and
reimbursed by Endo shall contribute to Endo’s Estimated Detailing Effort as set forth in the
License.

          c. Vernalis shall after 31 Jan 2006 and at all times during the remainder of the Term of this
Agreement, use Commercially Reasonable Efforts to provide at least the number of Product Details
set forth in the Annual Co-Promotion Plan. If for any *** consecutive calendar quarters, Vernalis
fails to provide a minimum of *** of the required Product Details set forth for Vernalis to provide
in the Annual Co-Promotion Plan, then Endo shall have the right to terminate this Agreement upon
*** days prior written notice to Vernalis; provided, however, that if the reason Vernalis has
failed to provide such *** is for a reason which meets the definition of Force Majeure,

5

 

then Endo shall not be entitled to terminate this Agreement on that basis and the Joint
Co-Promotion Team shall agree in good faith to an appropriate adjustment to the Annual Co-Promotion
Plan going forward. 

          d. Vernalis shall notify Endo prior to September 30, 2005 and prior to June 30 of each year
thereafter during the Term of the proposed number of Product Details to be included in the
promotion of the Product for the following calendar year. Vernalis may revise the proposed number
of Product Details provided to Endo by up to *** as long as such revisions are made in writing on
or before August 31st of subsequent years. For planning purposes only, at the same time
as Vernalis notifies Endo of the proposed number of Product Details, Vernalis shall also notify
Endo of the estimated number of Specialty Sales Personnel Vernalis intends to employ for Product
Details.

          e. In performing its duties hereunder, Vernalis shall, and shall cause its employees and
designees to, comply with all regulatory, professional and legal requirements, including, without
limitation, the FDA’s regulations and guidelines concerning the advertising of prescription drug
products, state laws and regulations relating to promotion of pharmaceutical products, the American
Medical Association’s Guidelines on Gifts to Physicians, the OIG Compliance Program Guidelines for
Pharmaceutical Manufacturers, the PhRMA Guidelines for Marketing Practices, and the ACCME Standards
for Commercial Support of Continuing Medical Education, which may be applicable to the co-promotion
of the Product by Vernalis. No employee or designee of Vernalis shall (i) make any representation,
statement, warranty or guaranty with respect to the Product that is not consistent with
then-current labeling of the Product or Marketing Materials approved by Endo, that is deceptive or
misleading or that disparages the Products or the good name, goodwill and reputation of Endo or
(ii) make any arrangements with, make payments to or provide gifts or other incentives to any
healthcare professionals in violation of applicable laws, regulations or guidelines relating
thereto. Vernalis covenants that its services hereunder will be provided in a professional,
ethical and competent manner in accordance with the foregoing standards. Notwithstanding Section
9.2 hereof, upon written notice to Vernalis by Endo, Vernalis shall take prompt action to address
any breach of this Section 3.1(e) and, within *** days shall submit to Endo a written plan to
correct such breach. If the breach is not cured within *** days after Endo’s receipt of such
corrective plan, or if Vernalis fails to timely submit to Endo such corrective plan, Endo may,
where the breach has been caused by one or more identifiable Vernalis Specialty Sales Personnel,
require that such Specialty Sales Personnel cease to promote the Product and, in all other cases,
may terminate this Agreement immediately upon written notice to Vernalis.

          f. Vernalis shall ensure that its Specialty Sales Personnel are familiar with the procedures,
obligations, rights, and responsibilities imposed by the terms of this Agreement as applicable to
the performance of promotional activities hereunder. Vernalis shall at all times ensure that its
Specialty Sales Personnel are providing Vernalis Detailing Services that are consistent with the
marketing messages developed and communicated to Vernalis by Endo and shall use only Marketing
Materials provided by Endo.

6

 

          g. To avoid any doubt, nothing express or implied in this Section 3.1 (including without
limitation Sections 3.1(a) and 3.1(b)) shall be read to limit in any way Vernalis’ rights under
Section 6.2 of the License.

          h. To avoid any doubt, because Endo determines and provides the Marketing Materials for
Product promotion in the USA, nothing express or implied in this Section 3.1 or elsewhere in this
Agreement shall be read to make Vernalis liable for its Product promotion based on the content of
the Marketing Materials provided by Endo; provided that Vernalis Specialty Sales Personnel are
properly using and promoting such content in accordance with applicable laws and instructions from
Endo.

     3.2 Vernalis Detail Reports. Vernalis shall provide Endo with a report (each a
“Vernalis Detail Report”), within *** calendar days after the end of each calendar quarter during
the Term (and within such period after the end of the Term as may be necessary to finalize this
Agreement), setting forth the following information regarding the efforts of Vernalis Specialty
Sales Personnel in promoting the Product during the preceding quarter (or part thereof): (i) the
number of Product Details made and recorded by Vernalis standard record keeping procedures based on
data recorded by the Specialty Sales Personnel and (ii) such other information as may be required
in the then-current Annual Co-Promotion Plan or deemed appropriate by the Joint Co-Promotion Team
(provided that Vernalis has in its discretion agreed to include such information required in such
plan, but in any case data provided must be sufficient to allow Endo to meet its obligations to
report detailing activity to Vernalis consistent with the format set forth in Schedule 5 of the
License). Each such Vernalis Detail Report shall be in an electronic format and in hard copy form.
An example of a Vernalis Detail Report is attached to this Agreement as Exhibit B. Each Vernalis
Detail Report shall be treated as Confidential Information of Vernalis pursuant to Section 10 of
this Agreement and shall not be disclosed to third parties without Vernalis’ prior written approval
or direction. Vernalis shall use Commercially Reasonable Efforts to use sales force tracking and
reporting systems that are complimentary with Endo’s sales force tracking and reporting systems.

     3.3 Vernalis Specialty Sales Personnel.

          a. Hiring. Vernalis shall be solely responsible for the recruitment and hiring of the
Specialty Sales Personnel; provided that:

               (i) In recruiting its Specialty Sales Personnel Vernalis shall hire representatives who, at a
minimum, have the qualifications of ***. Vernalis shall take into consideration Endo’s hiring
profile for specialty sales representatives, which is attached hereto as Exhibit D, as may be
subsequently amended, 

               (ii) Incentive compensation for Product promotion for Vernalis Specialty Sales Personnel shall
be based partly upon similar performance metrics as those which apply to Endo sales representatives
for promotion of the Product, and

               (iii) Upon *** days written request from Vernalis, Endo shall implement a referral program to
provide an incentive to its sales representatives to refer

7

 

qualified candidates to Vernalis for the Specialty Sales Personnel positions and Vernalis
shall reimburse Endo for all amounts paid to Endo sales representatives under such referral
program.

          b. Costs.

               (i) Endo shall reimburse Vernalis quarterly the Cost Per Detail up to *** over the proposed
number of Product Details provided by Vernalis under the terms of Section 3.1(d) above, but not to
exceed the maximum number of Product Details set forth in the following table. Such reimbursement
shall include reimbursement for all Product Details made in any year by Vernalis Specialty Sales
Personnel to Target Healthcare Professionals not included in the allocated lists agreed pursuant to
Section 3.3(c) (‘non-allocated Target Healthcare Professionals’); provided that at least *** of all
Product Details made in any year by Vernalis Specialty Sales Personnel are made to Target
Healthcare Professionals included in the allocated lists agreed pursuant to Section 3.3 (c)
(‘allocated Target Healthcare Professionals’). If the proportion of Product Details made in any
year by Vernalis Specialty Sales Personnel to allocated Target Health Care Professionals is less
than *** of total Product Details, the number of reimbursed Product Details to non-allocated Target
Health Care Professionals shall be adjusted such that the proportion of such Product Details is not
in excess of *** of all Product Details to be reimbursed.

               (ii) For example, if Vernalis, according to Section 3.1 (d), has provided a proposed number of
Product Details of *** and, subsequently, Vernalis Specialty Sales Personnel complete *** Product
Details, *** of which are to allocated Target Healthcare Professionals, the following reimbursement
calculation applies. First, the criterion that the proportion of Product Details to allocated
Target Healthcare Professionals is at least *** is applied. In this example, this is calculated as
follows: the number of Product Details to allocated Target Healthcare Professionals *** is divided
by ***. As this number of Product Details is less than the maximum number of Product Details for
which Endo is required to pay ***, Endo is therefore required to pay for *** Product Details. To
the extent necessary, reimbursement payments will be reconciled on an annual basis.

               (iii) Endo shall make such reimbursement payment within *** days after receipt by Endo of the
complete Vernalis Detail Report (which shall serve as an invoice, so long as it is so labeled).
Endo shall pay such costs to Vernalis in US Dollars by wire transfer of immediately available funds
to an account designated by Vernalis to Endo in writing. Endo shall have no obligation to
reimburse the Cost Per Detail after ***. Vernalis may in its discretion elect to continue to
Detail the Product in the USA at no cost to Endo after ***. All payments by Endo shall be made in
accordance with Section 11.15 of the License.

8

 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	YEARS	 	 	2006	 	 	 	2007	 	 	 	2008	 	 	 	2009	 	 	 	2010	 
	Maximum no. of Details to be
reimbursed
	 	 	***	 	 	 	***	 	 	 	***	 	 	 	***	 	 	 	***	 
	% of Cost per Detail where
all Vernalis Specialty Sales
Personnel Detail only the
Product
	 	 	***	 	 	 	***	 	 	 	***	 	 	 	***	 	 	 	***	 
	% of Cost per Detail where
any Vernalis Specialty Sales
Personnel Detail one or more
other products
	 	 	***	 	 	 	***	 	 	 	***	 	 	 	***	 	 	 	***	 

               (iv) Unless otherwise set forth in this Agreement, Vernalis shall be responsible for all other
costs and expenses associated with its Specialty Sales Personnel including without limitation,
salary, bonus, benefits, pension, insurance, social security, travel, entertainment, budgets and
any other related obligations such as income tax withholding and all applicable reporting
requirements. Sales representatives of either party shall not be eligible for awards, prizes,
contests or other incentives offered by the other party to its sales representatives, unless
otherwise agreed between the parties, in writing.

               (v) Vernalis shall be solely responsible for providing and financing fleet services to its
Specialty Sales Personnel.

               (vi) In the instances where Endo allocates a designated promotional budget to individual sales
representatives for the purposes of completing specific marketing-directed promotional activities,
Endo shall provide such promotional budget to Vernalis Specialty Sales Personnel at the same time
as provided to Endo sales representatives and as agreed by the Joint Co-Promotion Team. 

          c. Allocation. Vernalis and Endo shall agree on the call planning and targeting of
Specialty Sales Personnel; which shall be allocated per physician specialty as set forth in Exhibit
C. Unless the parties otherwise agree, such allocation shall

               (i) allocate calls equitably between the parties’ respective sales representatives, including
without limitation in relation to decile, geographic location and key opinion leaders; and

               (ii) specify a list of *** Target Healthcare Professionals (identifying from within that list
*** Target Healthcare Professionals to be treated as priority for Product Details) available for
each of the Vernalis Specialty Sales Personnel to undertake Product Details within their respective
geographic locations.

9

 

The parties recognize that some Target Healthcare Professionals may receive Product Details from
both Endo sales representatives and Vernalis Specialty Sales Personnel; however the parties agree
that the Vernalis Speciality Sales Personnel and Endo sales representatives shall not make Product
Details to the same Target Healthcare Professionals in the Primary Care and *** fields.

          d. CSO. Vernalis may enlist the services of a contract sales organization (“CSO”) for
the purpose of providing Product Details to Target Healthcare Professionals in the *** field only,
in accordance with the Annual Co-Promotion Plan; provided that Vernalis notify Endo at least ***
days prior to completing or substantially modifying an agreement with any such CSO. Any other use
of a CSO is prohibited under this Agreement absent written agreement from Endo, such agreement not
to be unreasonably withheld.

4. Responsibilities of Endo.

     4.1 Promotion of Product By Endo. Throughout the Term, Endo shall promote the Product
in accordance with the terms of the License. To avoid any doubt, this Agreement does not and shall
not be read to diminish Endo’s diligence and other obligations under the License.

     4.2 Manufacture, Shipment, Trade Relations.

          a. In accordance with the terms of the License, Endo shall have the sole responsibility for
the sale, manufacture, shipment, distribution, warehousing, billing, order confirmation of the
Product and for the collection of receivables resulting from sales of the Product in the USA, and
for recording of Product sales in its books of account. If for any reason Vernalis receives orders
for Products, Vernalis shall forward such orders to Endo (or if directed in writing by Endo to
Endo’s wholesalers) as soon as practicable. Vernalis Specialty Sales Personnel shall not contact,
call on or otherwise provide any Vernalis Detailing Services to any wholesale, distribution,
warehouse, managed care, GPO or other trade entities, whether or not these entities are customers
of Endo. To avoid any doubt, Vernalis shall remain free to work with any such wholesale,
distribution, warehouse, managed care, GPO or other trade customers with respect to other products
that Vernalis is otherwise free to pursue without violating the terms of this Agreement.

          b. Endo shall have the sole responsibility for determining the price of the Product during the
Term.

     4.3 Endo Reports. Endo shall provide to Vernalis:

          a. Detail and Sales Reports in accordance with the terms of the License, and

          b. Other data in return for adequate compensation, to be mutually agreed by the parties, for
the resources necessary to generate any such data.

10

 

     4.4 Sales Operations Support.

          a. Endo shall provide to Vernalis Specialty Sales Personnel all Marketing Materials to be used
for the purpose of providing Vernalis Detailing Services.

          b. Endo or Endo’s representative shall equitably supply samples of Product to Vernalis Sales
Personnel, in a manner consistent with distribution to Endo’s sales representatives. Vernalis
shall strictly comply with (i) all sample reporting requirements as directed and practiced by Endo
and (ii) all applicable laws, rules and regulations relating to sampling in the USA. Vernalis
Specialty Sales Personnel shall make all sample reports through Endo or its representative in a
manner that is compatible with Endo’s or its representative’s systems unless otherwise agreed by
the parties in writing.

5. Training, Marketing Materials and Non-Hiring of Employees.

     5.1 Training.

          a. Vernalis agrees to make its Specialty Sales Personnel available for Product and compliance
training with respect to the marketing and sale of the Product at times and locations to be agreed
by the Parties and Endo shall provide Phase One Training to Vernalis Specialty Sales Personnel
(including sales managers) and such additional training as may be agreed by the parties. Vernalis
shall not owe Endo any reimbursement for Endo’s costs in relation to such training. Vernalis may,
upon written notice to Endo, at any time and for any of its Specialty Sales Personnel, elect to use
its own training staff to train Vernalis Specialty Sales Personnel, provided that such training
staff (i) has undergone Endo’s Phase One Training and (ii) shall use Endo Marketing Materials and
Phase One Training materials. Notwithstanding the foregoing, Vernalis Specialty Sales Personnel
may, upon reasonable notice to Endo, attend regularly scheduled Endo sales training sessions that
are not Phase One Training sessions. No Specialty Sales Personnel shall be permitted to make
Product Details until completion of Phase One Training. All Product training shall be conducted in
accordance with the Annual Marketing Plan and Budget and shall be developed by Endo. As between
the parties hereto and except as expressly provided otherwise elsewhere in this Agreement or the
License, Endo shall own all right, title and interest in Product training materials used by
Vernalis and its Specialty Sales Personnel.

          b. Product training shall be carried out in accordance with Endo’s sales training schedule at
facilities selected by Endo, or as otherwise agreed by Endo. As Vernalis Specialty Sales Personnel
(including sales managers) are added or replaced, Product training will be provided to newly added
members. Except as otherwise agreed in writing by the parties, each party will absorb the costs of
transporting, housing and maintaining their respective sales personnel for such training. Endo
shall provide at Endo’s cost training materials for Vernalis Specialty Sales Personnel.

          c. Vernalis Specialty Sales Personnel shall perform Product Details in accordance with a
health care compliance guide to be implemented by Vernalis which

11

 

guide shall be consistent with the principles contained in Endo’s Health Care Compliance Guide
effective as of June 1, 2005 as it is applied to Endo’s sales representatives. The Vernalis health
care compliance guide shall be submitted for approval to the Co-Promotion Team before its
implementation and shall be updated consistent with any revisions made from time to time to Endo’s
Health Care Compliance Guide provided that Endo shall provide revisions to Vernalis within *** days
of approval by Endo management, and in any event, no later than the time that Endo provides such
revised policies to its own sales representatives.

     5.2 Sales Meetings and Management Activities.

          a. Endo shall use Commercially Reasonable Efforts to accommodate the attendance of Vernalis
Specialty Sales Personnel (including sales managers) at sessions dedicated solely to the Product at
Endo’s annual National Sales Meeting. Vernalis will absorb the costs of transporting, housing and
maintaining its personnel at this meeting.

          b. Endo and Vernalis sales managers as selected by their respective management shall meet at
least twice per year to address objectives specified by the Joint Co-Promotion Team, unless
otherwise agreed between the parties.

     5.3 Marketing Materials. All written sales, promotion and advertising materials
including updates, reports on thought leader interactions and reports on safety issues (“Marketing
Materials”) relating to the Product shall be developed by Endo and provided to Vernalis as
determined by Endo. Endo shall provide Marketing Materials to Vernalis Specialty Sales Personnel
in equitable quantities and in the same manner in which it provides such Marketing Materials to its
own sales representatives, relative to the individual representative’s call plan objectives for the
Product. Marketing Materials shall be used by the parties solely in connection with the training,
marketing and/or promotion of the Product and in accordance with all applicable laws and
regulations. Endo shall own all right, title and interest in all Marketing Materials. Endo is
responsible for its and its Affiliates’ Product marketing and promotion-related decisions and
policies (including without limitation as to the Marketing Materials and their content). Endo
hereby covenants that all such decisions and policies shall be in accordance with all applicable
Legal Requirements and any other applicable requirement referred to in Clause 3.1(e) of this
Agreement. Endo shall bear all responsibility for breaches of such covenant and provide
indemnification in accordance with Clause 15.8.7 of the License.

     5.4 Non-hiring of Sales Personnel. The parties hereby agree that, throughout the
Term, neither party will hire or employ any sales representative or sales manager of the other
party (or of the other party’s designee) without such party’s written consent.

6. Certain Regulatory Matters.

     6.1 Licenses. Each party hereto shall, at its sole cost and expense, maintain in full
force and effect all necessary licenses, permits and other authorizations required by law,
regulation, ordinance or statute to carry out its duties and obligations under this

12

 

Agreement. However, to avoid any doubt, this Section 6.1 does not alter the parties’ rights
and responsibilities under the License regarding Marketing Authorizations for the Product,
applications therefor and regulatory filings in relation to clinical trials of Product.

     6.2 Regulatory Responsibility.

          a. Communication and Filings with Governmental or Regulatory Authorities. As between
the parties, all regulatory matters regarding the Product, including without limitation all filings
in connection therewith, shall remain under the control of Endo as more fully and solely to the
extent set forth in the License. Vernalis shall not without the consent of Endo or unless so
required by applicable law (and then only pursuant to the terms of this Section 6.2), correspond or
communicate with any Governmental or Regulatory Authority concerning the Products or otherwise take
any action concerning any authorization or permission under which the Products are sold or any
application for the same. Furthermore, Vernalis shall, promptly (and in no event less than
seventy-two (72) hours) upon receipt of any communication from any Governmental or Regulatory
Authority relating to the Product, forward a copy or description of the same to Endo and respond to
all inquiries by Endo relating thereto. If Vernalis is advised by its counsel that it must
communicate with any Governmental or Regulatory Authority, then Vernalis shall so advise Endo
immediately and, unless prohibited by applicable law, provide Endo in advance with a copy of any
proposed written communication with any Governmental or Regulatory Authority and comply with any
and all reasonable direction of Endo concerning any meeting or written or oral communication with
any Governmental or Regulatory Authority to the full extent consistent with Vernalis’ counsel’s
advice regarding legal compliance and Vernalis’ legal obligations.

          b. Labeling and Marketing Materials. Endo shall have sole authority and
responsibility to seek and/or obtain any necessary Governmental or Regulatory Authority approvals
of any labeling, package inserts, Product monographs, packaging for the Products and Marketing
Materials, and for determining whether the same requires Governmental or Regulatory Authority
approval. As between the parties, all filings and communications with Governmental or Regulatory
Authorities in connection therewith shall remain under the control of Endo.

          c. MAM Product. Nothing in this Section 6.2 shall alter the License as regards
Vernalis’ rights in relation to development of the MAM Product and Paediatric Development Program
and regulatory activities and communications in relation thereto.

     6.3 Efficacy and Safety Information. Endo shall furnish Vernalis with efficacy and
safety information reasonably requested by Vernalis to assist Vernalis in promoting the Product to
Target Healthcare Professionals in the USA, including without limitation relevant clinical and
safety data included in the NDA for the Product and additional information, if any, related to the
efficacy and safety profile of the Product since the transfer of the NDA to Endo from Vernalis.
Except for that information that is to be disclosed to Target Healthcare Professionals in
connection with conducting Product Details, such information shall be treated as Confidential
Information of Endo pursuant to

13

 

Section 10 of this Agreement and shall not be disclosed to third parties without Endo’s prior
written approval or direction.

     6.4 Notice of Adverse Events. Each party shall perform its responsibilities under the Safety
Agreement in regards to adverse event reporting.

     6.5 Product Technical Complaints and Recalls. Each party shall perform its responsibilities
under the Safety Agreement in regards to product technical complaints and recalls.

     6.6 Government Inspections and Inquiries. Each party shall perform its responsibilities under
the Safety Agreement in regards to government inspections and inquiries.

     6.7 This Agreement does not alter, amend or supercede in any way the Safety Agreement.
Vernalis shall ensure that its Specialty Sales Personnel are trained as to their obligations under
the Safety Agreement and that each such employee undertakes to follow and comply with the
obligations set forth therein.

     6.8 Sales-Related Inquiries.

          a. For questions concerning Product identification, Product ingredients or stability/storage
information, Vernalis and its Specialty Sales Personnel shall refer such questions to Endo’s
Customer Service Department.

          b. For medical inquiries, including those related to information outside of labeling, clinical
studies, continuing medical education or other medical questions which Vernalis and its Specialty
Sales Personnel are unable to answer, Vernalis shall refer such inquiries to Endo’s Medical Affairs
Department. As between the parties, all responses to such inquiries from patients, medical
professionals, or other third parties shall be provided solely by Endo. Vernalis shall provide
reasonable assistance to Endo, at Endo’s request and expense, in an effort to fully respond to such
communications.

          c. For inquiries relating to legal and compliance issues surrounding the sale and promotion of
the Product in the USA or to report compliance concerns, Vernalis Specialty Sales Personnel shall
refer such inquiries or reports to Vernalis’ chief compliance officer or other individual as
designated by Vernalis. In the event that such inquiry or report may impact Endo’s legal
obligations in the USA, Vernalis shall notify Endo within five (5) days of the receipt of such
inquiry or report.

          d. All other questions or comments from Vernalis Specialty Sales Personnel should be directed
to a Vernalis member of the Joint Co-Promotion Team.

7. Joint Co-Promotion Team. The parties recognize that it is in the best interests of both
parties to maximize the sales and profits of the Product in the USA and to coordinate the
activities of both parties with respect to the promotion of the Product in the USA. Accordingly,
the parties agree to the following with regard to the Joint Co-Promotion Team. Any and all of the
following terms may be amended by agreement of the parties.

14

 

     7.1 Establishment. The parties hereby establish a committee (the “Joint Co-Promotion
Team”), which shall have as its overall purpose the following decisions and activities relating to
this Agreement: physician targeting, call planning, training, incentive plans, communication,
sales call tracking and reporting, sales operations, sales and marketing compliance, consistency of
marketing messages and positioning and other day-to-day issues relating to this Agreement. The
Joint Co-Promotion Team shall consist of no more than three (3) representatives of each party.
Members of the Joint Co-Promotion Team shall be employees of the parties, (including from each
Party at least one vice-president or equivalent involved in the marketing or promotion of the
Product) and shall not be outside consultants, independent contractors or outside legal counsel,
but such Persons are permitted to attend meetings of the committee upon the consent of both
parties. Each party shall be solely responsible for appointing, removing and filling vacancies
among its own representatives.

     7.2 Responsibilities. In addition to the specific responsibilities of the Joint
Co-Promotion Team set forth elsewhere in this Agreement, the Joint Co-Promotion Team shall:

          a. by October 1, 2005 prepare the first Annual Co-Promotion Plan for the introduction of the
Vernalis Specialty Sales Personnel and submit such plan to each party’s respective management for
approval. The first Annual Co-Promotion Plan shall be approved by December 15, 2005.

          b. by October 1 of each subsequent calendar year during the Term, prepare the Annual
Co-Promotion Plan for the next calendar year and submit such plans to each party’s respective
management for approval, which plans shall be approved by December 15th (or such
subsequent date as may be agreed by the parties, but no later than December 31st) of the
applicable year;

          c. periodically prepare other plans and budgets and obtain necessary approval, as agreed
between the parties;

          d. be responsible for the execution of approved plans and budgets;

          e. periodically provide written reports to each party’s management team and/or the Steering
Committee comparing actual results to the approved plans and budgets;

          f. perform the dispute resolution functions set forth in Section 7.4 hereof;

          g. communicate to one another relevant marketing and sales information that may impact
promotion or sales of the Product; and

          h. perform such other functions as necessary to carry out the obligations set forth in this
Agreement.

15

 

     7.3 Meetings. During the Term of this Agreement, the Joint Co-Promotion Team shall
meet: (i) at least quarterly on a date and at a location to be agreed to by the parties, and (ii)
upon written notice by either party to the other that a meeting is required or requested, in which
case a meeting will be held within thirty (30) calendar days of such notice on a date to be agreed
to by the parties (or sooner if warranted by circumstances), and at the location of the
non-requesting party, if a face-to-face meeting is requested, unless otherwise agreed by the
parties. Notice requesting a meeting shall include adequate information describing the purpose of
the meeting. Any meetings of the Joint Co-Promotion Team shall be held in person or, if an
in-person meeting is impracticable, by videoconference or teleconference. When meetings are held
in person, individual members of the Joint Co-Promotion Team may nonetheless participate by
videoconference or teleconference. If unable to attend in person or by videoconference or
teleconference, an individual member of the Joint Co-Promotion Team may grant a proxy to another
individual member of the Joint Co-Promotion Team in order to act on his or her behalf on any matter
to be acted upon at any meeting of the Joint Co-Promotion Team. Other representatives of the
parties may attend Joint Co-Promotion Team meetings as non-voting participants upon invitation of a
Joint Co-Promotion Team member. At least one week prior to any meeting of the Joint Co-Promotion
Team, each of the parties shall provide the other party with a proposed agenda of the matters to be
discussed at such meeting. The members shall agree, at the first meeting of the Joint Co-Promotion
Team, upon procedures for finalizing agendas, maintaining meeting minutes and other meeting
management procedures, as appropriate.

     7.4 Action of Committee. The joint Co Promotion Team may take action on a matter at
a meeting only if at least one representative is present from each party. Each party to the Joint
Co-Promotion Team shall be entitled to one (1) vote, regardless of the number of members
participating in the Joint Co-Promotion Team. In the event the Joint Co-Promotion Team is unable
to achieve a mutual decision on any issue, then the dispute resolution process set forth in Section
7.5 will be followed with respect to such issue.

     7.5 Dispute Resolution.

          a. The parties recognize that disputes as to certain matters may from time to time arise
during the Term that relate to either party’s rights and/or obligations hereunder. It is the
objective of the parties to establish procedures to facilitate the resolution of disputes arising
under this Agreement in an expedient manner by mutual cooperation and without resort to litigation.
To accomplish this objective, the parties agree to follow the procedures set forth in this Section
7.5 if and when a dispute arises under this Agreement.

          b. If the Joint Co-Promotion Team is unable to come to a mutual decision regarding any issue,
such dispute or other issue shall be referred to a senior executive responsible for the sales
function in each organization, which executive shall be at the level of Vice President or higher.
Unless circumstances otherwise dictate, the parties agree that the applicable executive shall not
be a member of the Joint Co-Promotion Team. If the senior executives are unable to resolve such a
dispute or issue within thirty (30) days after being requested to resolve such dispute or issue,
Endo’s

16

 

senior executive shall have the authority to make the final decision and Endo’s position on
such matter shall be final on all matters of discretion regarding promotional and marketing
decisions, subject to such decision being consistent with the terms and conditions of this
Agreement and the License (meaning, for example and without limitation, that Endo may not by
exercise of such final decision alter the number of Product Details to be provided by Vernalis or
modify Endo’s diligence and other obligations under the License or this Agreement).

8. Recordkeeping and Audits.

     8.1 Maintenance of Books and Records. Each party shall maintain complete and accurate
books and records in sufficient detail, in accordance with GAAP and all applicable laws, rules,
ordinances and regulations, to enable verification of the performance of such party’s obligations
under this Agreement. Such records shall be maintained for the latest to occur of (i) a period of
*** months after the end of each calendar year in the Term, (ii) longer if required by applicable
law or (iii) until the final resolution of any audit or dispute as to which such records relate.

     8.2 Payment Audits.

          a. Either party (herein, the “Auditing Party”) may demand, no more than once for any calendar
year in the Term, an audit of the relevant books and records of the other party (herein, the
“Audited Party”) in order to verify the Audited Party’s reports on the matters addressed in this
Agreement. Upon no less than thirty (30) days’ prior written notice to the Audited Party, the
Audited Party shall grant reasonable access to members of a nationally-recognized independent
public accounting firm selected by the Auditing Party to the relevant books and records of the
Audited Party in order to conduct a review or audit thereof. Such access shall be permitted during
normal business hours. The accounting firm shall report its conclusions and calculations to the
Auditing Party and the Audited Party; provided, that in no event shall the accounting firm disclose
any information of the Audited Party except to the extent necessary to verify the Audited Party’s
reporting and other compliance with the terms of this Agreement and, at the request of the Audited
Party, such accounting firm will execute appropriate non-disclosure agreements. Except as
hereinafter set forth, the Auditing Party shall bear the full cost of the performance of any such
audit.

          b. If as a result of any audit of the books and records of Audited Party it is shown that the
Audited Party’s payments to the Auditing Party under this Agreement with respect to the period of
time audited were less than the amount which should have been paid to the Auditing Party pursuant
to this Agreement, then the Audited Party shall pay to the Auditing Party the amount of such
shortfall within thirty (30) days after the Auditing Party’s demand therefor. If as a result of
any audit of the books and records of Audited Party it is shown that the Audited Party’s payments
to the Auditing Party under this Agreement with respect to the period of time audited were more
than the amount which should have been paid to the Auditing Party pursuant to this Agreement, then
the Auditing Party shall pay to the Audited Party the amount of such overpayment within thirty (30)
days after the Audited Party’s demand therefor. In addition, if any

17

 

amount of underpayment by the Audited Party is more than *** of the amount which should have
been paid to the Auditing Party pursuant to this Agreement with respect to the period in question,
then the Audited Party shall also reimburse the Auditing Party for its documented, reasonable,
out-of-pocket costs and expenses incurred in connection with the audit.

          c. In the event that the parties do not agree on the amount of overpayment or underpayment,
within ten (10) business days, each party shall select an independent public accounting firm which
shall meet and discuss the amount in dispute and other related matters within ten (10) business
days thereafter. If such independent public accounting firms cannot agree on a resolution mutually
agreeable to the parties, such independent public accounting firms shall, within ten (10) business
days thereafter, appoint a third independent public accounting firm which shall resolve the issue
within ten (10) business days after its selection. The recommendation of the third independent
public accounting firm shall be final and binding upon the parties. A judgment on such firm’s
disposition may be entered in any court having jurisdiction over the parties.

     8.3 Compliance Audits. In addition to the access and audit rights of the parties set
forth in Section 8.2, upon reasonable prior notice from the other party (‘the Auditing Party’) and
no more than once during any calendar year during the Term, each party (‘the Audited Party’) shall
afford to the Auditing Party reasonable access during normal business hours (and at such other
times as the parties may mutually agree) to inspect and audit the relevant books, records and other
information of the Audited Party in order to monitor the Audited Party’s compliance with Detailing
obligations under the applicable Marketing Plan and the terms of this Agreement, to the extent such
party is responsible for the relevant function as directed by the Joint Co-Promotion Team or the
terms of this Agreement, and for the purposes of determining compliance with the applicable rules
and regulations of Governmental or Regulatory Authorities and the terms of this Agreement. Any
inspection conducted pursuant to this Section 8.3 shall be at the sole cost and expense of the
Auditing Party.

9. Term and Termination.

     9.1 Term of Agreement. The term of this Agreement (the “Term”) shall commence as of
the Effective Date and shall continue for so long as Endo or an Endo Affiliate or successor
Commercializes Product in the USA, unless this Agreement is terminated sooner as provided below or
either party terminates the License.

     9.2 Termination by Endo.

          a. Endo shall have the right to terminate this Agreement at any time upon written notice to
Vernalis if Vernalis materially breaches any of its representations, warranties, covenants or
agreements set forth in this Agreement or otherwise materially defaults in the performance of any
of its duties or obligations under this Agreement, which breach or default shall not be cured
within *** after written notice is given to Vernalis specifying the breach or default.

18

 

          b. To the extent permitted by law, Endo shall have the right to terminate this Agreement
immediately upon notice to Vernalis if Vernalis shall become insolvent, file or consent to the
filing of a petition under any bankruptcy or insolvency law or have any such petition filed against
it which has not been stayed within sixty (60) days of such filing or have a receiver appointed
over any of Vernalis’ property or assets.

          c. Endo shall have the right to suspend Vernalis’ right to further promote (and Endo’s
obligation to pay Vernalis for further Details) under this Agreement upon *** written notice to
Vernalis if there has been a change, circumstance, effect or occurrence (or series of changes,
circumstances, effects or occurrences) that individually or in the aggregate would or would be
reasonably likely to materially and adversely affect the rights and/or obligations of the parties
hereunder or the benefits expected to be derived herefrom. The parties hereby agree, without
limitation, that the occurrence of any of the following shall have such material and adverse effect
for the purposes of this Section 10.2(c): (a) the FDA withdraws its approval of the Product; (b)
the Product is no longer approved by the FDA (c) the issuance of a court order enjoining the
manufacture, sale, or distribution of the Product; and (d) any mandatory recall ordered by the FDA
which results in substantial failure to supply market demand. The parties shall promptly meet and
confer regarding how to manage such a situation if it arises and how the material and adverse
effect may be abated by Endo by the application of Commercially Reasonable Efforts. If possible to
abate such effect by the application of such efforts, Endo shall do so. Once such effect is
materially abated, Vernalis’ right to further promote (and Endo’s obligation to pay Vernalis for
further Details) shall no longer be suspended.

     9.3 Termination by Vernalis.

          a. Vernalis shall have the right to terminate this Agreement at any time upon ninety (90) days
written notice to Endo with or without cause.

          b. Vernalis shall have the right to terminate this Agreement at any time upon written notice
to Endo if Endo materially breaches any of its representations, warranties, covenants or agreements
set forth in this Agreement or otherwise materially defaults in the performance of any of its
duties or obligations under this Agreement, which breach or default shall not be cured within
ninety (90) days after written notice is given to Endo specifying the breach or default. If
Vernalis terminates under this Clause 9.3(b), then Clause 9 and Schedule 10 of the License shall no
longer be superceded by this Agreement and Vernalis shall retain its right under Section 9.3 of the
License to provide up to the maximum number of Details in each year set forth in the chart in
Section 9.1 of the License (along with all of Vernalis’ other rights under the License).

     9.4 Effects of Termination.

          a. Neither the termination nor expiration of this Agreement shall release or operate to
discharge either party from any liability or obligation that may have accrued prior to such
termination or expiration. Any termination of this Agreement as provided herein shall not be an
exclusive remedy but shall be in addition to any remedies whatsoever that may be available to the
terminating party.

19

 

          b. Notwithstanding the giving of any notice of termination pursuant to this Section 9, each
party shall continue to fulfill its obligations under this Agreement at all times until the
effective date of any such termination.

     9.5 Actions Upon Termination. Upon the termination or expiration of this Agreement
for any reason, the parties shall negotiate in good faith to conduct an orderly wind down of the
Vernalis Detailing Services. Each party agrees that, after receipt of such notice, neither it nor
any of its employees shall engage in any activities that negatively impact (i) the promotion or
goodwill of the Product, (ii) relationships with the Target Healthcare Professionals or (iii) the
name, reputation or goodwill of the other party or any of its Affiliates, employees, agents or
contractors. If Endo terminates under Section 9.2, Vernalis shall promptly (y) discontinue any use
of Endo Trademarks and return to Endo or, at Endo’s request, destroy all Marketing Materials for
the Product (not already distributed or destroyed with destruction certified by Vernalis) and (z)
return to Endo or arrange for the return to Endo’s vendor, all sample inventories held by Vernalis
Specialty Sales Personnel. Endo shall not have the right to solicit, recruit and/or hire any
Vernalis Specialty Sales Personnel for a period of twelve months following the effective date of
termination, unless otherwise agreed by the parties.

     9.6 Survival. The representations, warranties, covenants and agreements of the
parties in Sections 6.4-6.7, 8.1, 9.4, 9.5, 10, 11, 15.1 and 15.2, hereof, shall survive any
expiration or termination of this Agreement. In addition, any provision of this Agreement that,
either from the express language or the context thereof, is intended to survive any termination or
expiration of this Agreement shall survive any such expiration or termination.

10. Confidentiality.

     10.1 Confidential Information. For purposes of this Agreement, each party shall be
bound by the terms relating to Confidentiality set forth in Clause 16 of the License and all
information exchanged between the parties shall be subject to that Clause, including the definition
of Confidential Information.

     10.2 Survival. The obligations set forth in this Section 10 shall survive the later
of the termination or expiration of this Agreement and that of the License Agreement for a period
of five (5) years.

11. Indemnification and Insurance; Limitation of Liability.

     11.1 Definition. The License is hereby amended to add the following definition:
“Co-Promotion Agreement” shall mean that certain agreement between the Parties regarding Product
co-promotion matters dated 1st July 2005.

     11.2 Indemnification by Vernalis. Clause 15.9 is hereby amended to add a new Clause
15.9.10 as follows:

15.9.10 A breach by Vernalis or its Affiliates of the Co-Promotion Agreement or
any negligent act or omission or intentional misconduct by

20

 

Vernalis or any of its Affiliates in relation to activities under such agreement.

     11.3 Indemnification by Endo. Clause 15.8 is hereby amended to add a new Clause
15.8.7 as follows:

15.8.7 A breach by Endo or its Affiliates of the Co-Promotion Agreement (including
without limitation any representation, warranty or covenant contained or any
negligent act or omission or intentional misconduct by Endo or any of its
Affiliates in relation to activities under such agreement.

     11.4 Claims Procedures. To avoid any doubt, indemnification in relation to this
Agreement shall be through Clauses 15.8 and 15.9 of the License (as amended by this Agreement to
add Clauses 15.9.10 and 15.8.7) and claims procedures and all related matters shall be as set forth
in the License.

     11.5 Insurance. Insurance requirements are as set forth in Clause 15.13 of the
License.

     11.6 Limitation of Liability. Clause 15.12 of the License shall apply under this
Agreement as if set forth herein in its entirety.

12. Representations and Warranties.

     12.1 Each party represents and warrants to the other as of the Effective Date of this
Co-Promotion Agreement as to the representations and warranties set forth in Clause 15.1 of the
License.

     12.2 EXCEPT AS EXPRESSLY STATED IN SECTION 11 AND SECTION 12.1 ALL OTHER WARRANTIES,
CONDITIONS AND REPRESENTATIONS, EXPRESS OR IMPLIED, STATUTORY OR OTHERWISE, INCLUDING A WARRANTY AS
TO THE QUALITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF THE PRODUCT ARE HEREBY EXCLUDED.

13. Notices. Article 26 of the License shall apply to this Agreement as if set forth
herein in its entirety. To avoid any doubt, the notice address for a party under this Agreement
need not be the same notice address for such party as under the License Agreement.

14. Entire Agreement. 

     14.1 Relationship to License, Safety Agreement, Loan Agreement and Security Agreement.
This Agreement amends and supercedes during the Term of this Agreement Article 9 and Schedule 10
of the License and amends the License to define Co-Promotion Agreement and add Clauses 15.9.10 and
15.8.7. This Agreement does not otherwise amend, modify, alter, or supercede the License. This
Agreement does not amend, modify, alter or supersede the Safety Agreement, Loan Agreement or
Security Agreement. To the extent of any conflict between this Agreement and the License
(excluding its Article 9 and Schedule 10 and except as regards this Agreement’s

21

 

amendment to the License to define Co-Promotion Agreement and add Clauses 15.9.10 and 15.8.7),
Safety Agreement, Loan Agreement and/or Security Agreement, the License (excluding Article 9 and
Schedule 10 and except as regards this Agreement’s amendment to the License to define Co-Promotion
Agreement and add Clauses 15.9.10 and 15.8.7), Safety Agreement, Loan Agreement and/or Security
Agreement (as applicable) shall prevail.

     14.2 Relationship to Other Agreements, Understandings and Arrangements. Apart from
the License Agreement (excluding Article 9 and Schedule 10), Safety Agreement, Loan Agreement and
Security Agreement, this Agreement contains all of the terms agreed to by the parties regarding the
subject matter of this Agreement and shall supersede any and all other prior oral or written
agreements, understandings or arrangements between them with respect to such subject matter. 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 shall act as a modification or waiver of any provisions of this
Agreement.

15. Miscellaneous Provisions.

     15.1 From License. Clauses 19, 21, 23, 24, 28 and 29 of the License shall apply to
this Agreement as if set forth herein in their entireties.

     15.2 Dispute Resolution. Any disputes arising hereunder, other than disputes arising
under Section 7.5 shall be governed by and resolved in accordance with Clause 22 of the License.
Such Clause of the License shall apply to such disputes as if set forth herein in such Clause’s
entirety.

     15.3 Relationship of the 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 Person. All financial obligations
associated with each party’s business shall be the sole responsibility of such party.

     15.4 No Implied Licenses. Each of the parties hereby acknowledges and agrees that,
except as otherwise explicitly provided in this Agreement or the License, such party shall not by
entering into this Agreement have, assert or acquire any right, title or interest in or to any
intellectual property or other proprietary rights of the other party.

     15.5 Sub-Contracting. Other than as provided under clause 3.3(d) Vernalis may not
sub-contract any of its rights or obligations under this Agreement, except to an Affiliate.

     15.6 Force Majeure. Clause 20 of the License shall apply to this agreement as if set
forth herein in its entirety, except that the last sentence of Clause 20.2 is amended (solely as
applied to this Agreement, not as applied to the License) to read as follows: If

22

 

Vernalis terminates this Agreement under this Section 15.5, the effect of this termination
shall be as if Vernalis had terminated this Agreement under Section 9.3(b).

     15.7 Headings. The headings contained in this Agreement are for reference purposes
only and shall not affect in any way the meaning or interpretation of this Agreement.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

23

 

     IN WITNESS WHEREOF, the parties have duly executed this Co-Promotion and Royalty
Agreement as of the first date written above.

	 	 	 	 	 
	 	

ENDO PHARMACEUTICALS INC.

 	 
	 	By:  	/s/ Peter A. Lankau
 	 
	 	 	Name:  	Peter Lankau 	 
	 	 	Title:  	President and CEO 	 
	 

	 	 	 	 	 
	 	VERNALIS DEVELOPMENT LTD.

 	 
	 	By:  	
/s/ John A D Slater
 	 
	 	 	Name:  	John A D Slater 	 
	 	 	Title:  	Director 	 

 

 

	 	 	 	 	 

Exhibit A

Example of Vernalis Detail Report

DETAIL REPORT FOR QUARTER ENDED                     

THIS IS AN INVOICE

	 	 	 	 	 	 	 	 	 
	 	 	Actual #	 	 	Budget #	 
	Total number of Product Details
	 	 	 	 	 	 	 	 
	Total number of *** Details
	 	 	 	 	 	 	 	 
	Total number of *** Details to Target
	 	 	 	 	 	 	 	 
	Healthcare Professionals:
	 	 	 	 	 	 	 	 
	Primary Details
	 	 	 	 	 	 	 	 
	Secondary Details
	 	 	 	 	 	 	 	 
	Total number of *** Physician Details
	 	 	 	 	 	 	 	 
	Total number of *** Physician Details to
	 	 	 	 	 	 	 	 
	Target Healthcare Professionals:
	 	 	 	 	 	 	 	 
	Primary Details
	 	 	 	 	 	 	 	 
	Secondary Details
	 	 	 	 	 	 	 	 
	Total number of *** Details
	 	 	 	 	 	 	 	 
	Total number of *** Details to Target
	 	 	 	 	 	 	 	 
	Healthcare Professionals:
	 	 	 	 	 	 	 	 
	Primary Details
	 	 	 	 	 	 	 	 
	Secondary Details
	 	 	 	 	 	 	 	 

 

 

Exhibit B

Sample Schedule of Phase 1 Training

Frova® New Representative Training Agenda

***

 

 

Exhibit C

Allocation of Call Plan

***

 

 

Exhibit D

Specialty Sales Representative Hiring Profile

Specialty Sales Representative

***

	 	 	 	 	 	 	 	 	 
	Prepared By:

	 	 	 	Date:
	 	 	 	 
	 

	 	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Approved By:

	 	 	 	Date:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00087-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00087-of-00352.parquet"}]]