Document:

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                                                                   EXHIBIT 10.21

*** Certain information (indicated by an asterisk) has been omitted from this
    document pursuant to a request for confidential treatment. The omitted
    material has been filed separately with the Securities and Exchange
    Commission.

                              COPROMOTION AGREEMENT

               This COPROMOTION AGREEMENT is made as of the Effective Date
(defined below), by and between WOMEN FIRST HEALTHCARE, INC., a Delaware
corporation, having a place of business at 12220 El Camino Real, Suite 400 San
Diego, California 92130 ("WFHC"), and ESSENTIA PHARMACEUTICALS B.V., a
corporation of the Netherlands, maintaining its principal business offices at
16690 Swingley Ridge Road, Suite 100, P.O. Box 679, Chesterfield, MO 63006-0679
("Essentia").

                               W I T N E S S E T H

               WHEREAS, WFHC markets and distributes oral estrogen tablets under
the trademark "ORTHO-EST(R)" and estradiol transdermal systems under the
trademark "Esclim(TM)," both of which have been approved by the U.S. Food and
Drug Administration ("FDA") as hormonal replacement therapy products (as more
fully specified in the labeling for the product); and

               WHEREAS, Essentia is engaged in the business of marketing
pharmaceutical products to physicians; and

               WHEREAS, WFHC wishes to expand the promotion of ORTHO-EST(R) oral
estrogen tablets and Esclim(TM) transdermal estrogen patches to certain family
practitioners and general practitioners who are "Covered Physicians," as defined
below, and Essentia desires to have the right to copromote such products to such
physicians, upon the terms specified herein.

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

1.   DEFINITIONS.

               For purposes of this Agreement, the following terms shall have
the corresponding meanings set forth below:

               "Affiliate" means, with respect to any Person, any other Person
which directly or indirectly controls, is controlled by, or is under common
control with, such Person. A Person shall be regarded as in control of another
Person if it/he/she owns, or directly or indirectly controls, more than fifty
percent (50%) of the voting securities (or comparable equity interests) or other
ownership interests of the other Person, or if it/he/she directly or indirectly
possesses the power to direct or cause the direction of the management or
policies of the other Person, whether through the ownership of voting
securities, by contract or any other means whatsoever.

               "Agreement" means this agreement, together with all appendices,
exhibits and schedules hereto, and as the same may be amended or supplemented
from time to time hereafter by a written agreement duly executed by authorized
representatives of each party hereto.
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               "Agreement Quarter" means each three-month period commencing on
the first day of January, April, July or October, as the case may be, during the
Copromotion Term. The first Agreement Quarter shall commence on April 6, 2001
and end on June 30, 2001.

               "Agreement Year" means each 12-month period commencing on April 1
and each anniversary thereof during the Copromotion Term.

               "Average Selling Price Per Esclim(TM) Prescription" has the
meaning set forth in Section 11(b) hereof.

               "Average Selling Price Per ORTHO-EST(R) Prescription" has the
meaning set forth in Section 11(c) hereof.

               "Baseline Agreement Year Esclim(TM) Prescriptions" and "Baseline
Quarterly Esclim(TM) Prescriptions" have the meanings set forth in Section 11(b)
hereof.

               "Baseline Agreement Year ORTHO-EST(R) Prescriptions" and
"Baseline Quarterly ORTHO-EST(R) Prescriptions" have the meanings set forth in
Section 11(c) hereof.

               "Baseline Annual Esclim(TM) Sales Attributable to Covered
Physicians" has the meaning set forth in Section 11(b) hereof.

               "Baseline Annual ORTHO-EST(R) Sales Attributable to Covered
Physicians" has the meaning set forth in Section 11(c) hereof.

               "Call Plan" has the meaning set forth in Section 5(d) hereof.

               "Confidential or Proprietary Information" has the meaning set
forth in Section 15 hereof.

               "Copromotion Term" has the meaning specified in Section 13(a)
hereof.

               "Costs" has the meaning specified in Section 6(d) hereof.

               "Covered Physician" means any of the family practitioners/general
practitioners listed on Exhibit A hereto.

               "Covered Physician Esclim(TM) Prescriptions" has the meaning set
forth in Section 11(b) hereof.

               "Covered Physician ORTHO-EST(R) Prescriptions" has the meaning
set forth in Section 11(c) hereof.

               "Detail" or "Details" and "Detailing" means, with respect to the
Products, the activity undertaken by a sales representative during a
face-to-face sales call on physicians or other health care professionals with
prescribing authority to provide information on the use, safety, effectiveness,
contraindications, side effects, warnings and other relevant characteristics of
the Products, in a fair and balanced manner consistent with the requirements of
the Food,

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Drug and Cosmetic Act, including, but not limited to, the regulations
of 21 CFR Part 202, and using, as necessary or desirable, labeling or
promotional materials, in an effort to increase physician prescribing
preferences of the Products.

               "Effective Date" of this Agreement means April 6, 2001.

               "Esclim(TM) Product" means all product presentations (including
all dosage strengths) of Esclim(TM) estradiol transdermal systems currently
approved by FDA, and any new dosages or indications or uses (including all
dosage strengths) of same that are approved by FDA during the term of this
Agreement.

                "Esclim(TM) Trademark" means the trademark Esclim(TM) and any
other trademark or trade name (whether registered or unregistered) used on or
with the Esclim(TM) Product or in any promotional material related to the
Esclim(TM) Product in the Territory during the Copromotion Term.

               "Essentia Funded Activities" has the meaning specified in Section
6(b) hereof.

               "Fournier Agreement" means the Distribution and License Agreement
between WFHC and Laboratoires Fournier S.A. dated as of July 19, 1999, as
amended.

               "IMS America" means the International Marketing Services
Prescription Reporting Service.

               "Initial Training Session" has the meaning in Section 7(a)
hereof.

               "License Cost per Esclim(TM) Prescription" has the meaning in
Section 11(b) hereof.

               "Net Esclim(TM) Sales Attributable to Covered Physicians" has the
meaning set forth in Section 11(b) hereof.

               "Net ORTHO-EST(R) Sales Attributable to Covered Physicians" has
the meaning set forth in Section 11(c) hereof.

               "Net Sales" means for the applicable period the gross amount
invoiced for the Esclim(TM) Product or the ORTHO-EST(R) Product, as the case may
be, by WFHC or its licensees to Third Parties in the Territory, less the
following amounts to the extent deducted on such invoice or absorbed by WFHC:

                    (i)  trade, quantity and cash discounts or rebates actually
and lawfully allowed and taken and any other similar adjustments, including,
without limitation, those granted on account of price adjustments, billing
errors, rejected goods, and damaged goods;

                    (ii) price reductions, credits, rebates, product returns,
charge-back and prime vendor rebates, fees, reimbursements or similar payments
or adjustments actually granted or given to wholesalers and other distributors,
buying groups, health care insurance carriers,

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pharmacy benefit management companies, health maintenance organizations or other
institutions or health care organizations;

                    (iii) any sales or use tax, customs duties, excise or other
duties or other governmental charge (other than an income tax) levied on the
sale, transportation or delivery of the Esclim(TM) Product or the ORTHO-EST(R)
Product, as the case may be;

                    (iv) price reductions, credits, rebates, charge-back and
prime vendor rebates, fees, reimbursements or similar payments or adjustments
actually granted or given in connection with sales of the Esclim(TM) Product or
the ORTHO-EST(R) Product, as the case may be, to any governmental or regulatory
authority in respect to any state or federal Medicare, Medicaid or similar
programs; and

                    (v)  bad debts.

               "ORTHO-EST(R) Agreement" means the ORTHO-EST(R) Asset Transfer &
Supply Agreement between WFHC and Ortho-McNeil Pharmaceutical, Inc. effective as
of September 30, 2000.

               "ORTHO-EST(R) Product" means all product presentations
(including all dosage strengths) of ORTHO-EST(R) tablets currently approved by
FDA, and any new tablets or other presentations of ORTHO-EST(R), and any new
dosages or indications or uses (including all dosage strengths) of same that are
approved by FDA during the term of this Agreement

               "ORTHO-EST(R) Trademark" means the trademark ORTHO-EST(R) and any
other trademark or trade name (whether registered or unregistered) used on or
with the ORTHO-EST(R) Product or in any promotional material related to the
ORTHO-EST(R) Product in the Territory during the Copromotion Term.

               "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.

               "Products" means the ORTHO-EST(R) Product and the Esclim(TM)
Product.

               "Sales/Marketing Committee" has the meaning specified in Section
5(a) hereof.

               "Serious adverse event" and "Non-serious adverse event" have the
meanings set forth in section 9(g) hereof.

               "Territory" means the fifty states of the United States of
America.

               "Third Party" means any Person other than (i) WFHC and any of its
Affiliates and (ii) Essentia and any of its Affiliates.

               "Trademarks" means the ORTHO-EST(R) Trademark and the Esclim(TM)
Trademark.

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               "WFHC Funded Activities" has the meaning specified in Section
6(a) hereof.

2.   GRANT OF RIGHTS TO ESSENTIA.

               (a)  WFHC hereby engages Essentia to promote the Products during
the Copromotion Term on an exclusive basis to Covered Physicians in the
Territory, upon the terms and conditions set forth to this Agreement. WFHC
reserves all rights not expressly granted hereunder. Notwithstanding the
foregoing, WFHC reserves the right to promote the Products or to grant to one or
more Third Parties the right to promote the Products within the Territory to
physicians and health care providers other than Covered Physicians on terms no
more favorable than those granted to Essentia.

               (b)  WFHC and Essentia agree to meet periodically, but no less
often than once per Agreement Year, to review and to consider in good faith
proposed revisions to the list of Covered Physicians. In addition, WFHC agrees
that if Essentia increases the number of its sales representatives Detailing the
Products to Covered Physicians to more than 50, WFHC will negotiate in good
faith an increase in the number of Covered Physicians. If the parties agree upon
an increase in the number of Covered Physicians, WFHC and Essentia shall confer
and consider in good faith making an equitable adjustments in the Baseline
Agreement Year Esclim(TM) Prescriptions, the Baseline Quarterly Esclim(TM)
Prescriptions, the Baseline Agreement Year ORTHO-EST(R) Prescriptions and the
Baseline Quarterly ORTHO-EST(R) Prescriptions.

               (c)  Subject to the terms and conditions of this Agreement, WFHC
hereby grants to Essentia the non-exclusive right to use the Trademarks during
the Copromotion Term solely in connection with the promotion of the Products to
Covered Physicians in the Territory in accordance with this Agreement. Essentia
shall comply with the terms of use of the Esclim(TM) Trademark set forth on
Exhibit B hereto and with the terms of use of the ORTHO-EST(R) Trademark set
forth on Exhibit C hereto.

3.   COPROMOTION BY ESSENTIA.

               (a)  Essentia shall use reasonable commercial efforts to
diligently promote the Products in the Territory to Covered Physicians in
accordance with the terms of this Agreement during the Copromotion Term.

               (b)  During the Copromotion Term, Essentia shall deploy a sales
force comprised of at least 50 committed sales representatives to Detail the
Products to Covered Physicians in the Territory. On each Detail, Essentia agrees
to Detail the Esclim(TM) Product and the ORTHO-EST(R) Product together as one
product in a position no worse than the second product position during the
Detail. In addition, the Products will represent at least 30% of the time spent
by Essentia sales representatives during each Detail.

               (c)  During the Copromotion Term, Essentia shall cause its sales
force to call upon pharmacies as may be reasonably necessary to ensure product
"pull through" so that supplies of the Products are available to fill
prescriptions written by Covered Physicians.

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               (d)  Except as provided for in Section 6 of this Agreement and
subject to the terms and conditions of this Agreement, Essentia shall be solely
responsible for the costs and expenses of establishing and maintaining its sales
force and conducting its other activities under this Agreement and shall have
sole authority to control its sales force and direct the activities of its sales
force. It is understood that the Essentia sales force will not be composed, in
any material part, of contract sales personnel or telemarketers hired by
Essentia without the prior written consent of WFHC.

               (e)  Except as provided in Section 3(c), Essentia shall instruct
its sales force not to, and shall use commercially reasonable efforts to ensure
that its sales force does not, promote or detail the Products outside the
Territory or to any physician, osteopath or health care professional who is not
a Covered Physician. Essentia shall provide WFHC, within five (5) working days
of transmission, complete copies and/or transcripts of all home office generated
(for example, those sent out by Essentia's Sales, Marketing and Sales Training
departments) communications (whether written, electronic or visual aids) to a
majority of Essentia sales representatives or detail personnel concerning the
promotion of the Products. The individual to whom these shall be sent will be
designated by WFHC upon execution of this Agreement. All such written,
electronic and visual communications provided to a majority of Essentia sales
representatives regarding product strategy, positioning or selling messages
shall be consistent in all respects with the positioning strategy and selling
messages then approved by the Sales/Marketing Committee, shall comply with the
product labeling, and shall be in accordance with applicable law.

               (f)  WFHC shall retain sole responsibility for contractual and
other relationships with managed care organizations, formularies, insurers, and
governmental agencies and instrumentalities (including without limitation
Medicare, Medicaid, the Veterans Administration, and military entities). If any
information derived from such relationships would be pertinent to the
development of the Covered Physician market by Essentia hereunder, WFHC will,
where legally able to do so, share such pertinent information with Essentia
under an obligation of confidentiality.

               (g)  During the Copromotion Term and for one year (1) year
thereafter, Essentia shall not market, promote or otherwise sell any other
estrogen replacement therapy product other than the Products. Without limiting
the generality of the foregoing, Essentia shall not develop, manufacture, sell,
distribute or promote any transdermal patch containing estradiol as the sole
active ingredient. Said one-year post-Copromotion Term restriction shall not
apply, however, if (1) WFHC has terminated this Agreement pursuant to Section
13(c)(ii) or 13(c)(iii) or (2) Essentia has terminated this Agreement pursuant
to Section 13(b).

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4.   RESPONSIBILITIES OF WFHC.

               (a)  Except as may be provided for in Section 6 of this
Agreement, WFHC shall be solely responsible for the costs and expenses of
conducting its activities under this Agreement.

               (b)  As between WFHC and Essentia, WFHC shall have the sole
authority to determine the price of the Products sold by WFHC, including price
increases or decreases and the timing thereof as determined by WFHC.

               (c)  As between WFHC and Essentia, WFHC shall have the sole
responsibility, at its cost and expense, for manufacturing or acquiring the
Products, as the case may be, and shipping, distribution and warehousing of the
Products, for the invoicing and billing of purchasers of the Products, for order
confirmation (if any) in accordance with WFHC customary practices, and for the
collection of receivables resulting from Net Sales. WFHC will book all sales of
the Products sold by WFHC and its Affiliates. This Agreement shall not be
construed as creating or implying any obligation on WFHC's part to supply
Essentia with the Products, other than samples of the Products.

               (d)  WFHC shall use commercially reasonable efforts, including
maintaining reasonable levels of inventory in light of customary industry
practice, to ensure that sufficient stock of the Products will be available in
its inventory to fill orders from the trade in accordance with normal industry
practices. In the event that there is not sufficient inventory of the Products,
and if such insufficient inventory proximately causes sales to Covered
Physicians in an Agreement Year to be materially less than they would have been
and Essentia is able to demonstrate the same to WFHC's reasonable satisfaction,
then WFHC and Essentia shall mutually determine the amount of lost Net Sales,
and the Baseline Sales figure in Section 11 hereof relating to the affected
Product shall be adjusted, for that Agreement Year only, to reflect such number
of lost Net Sales (and the Agreement Quarter targets for such Agreement Year
shall also be adjusted to equitably and appropriately reflect such lost Net
Sales in the Agreement Quarter(s) in which incurred). Such adjustment shall be
Essentia's sole remedy for any lost sales to Covered Physicians caused by
inadequate supply of the Products.

               (e)  WFHC shall use reasonable efforts consistent with applicable
legal requirements to maintain all necessary authorizations with the FDA to
market the Products in the Territory, provided that Essentia does not engage in
any act or omission inconsistent with such legal requirements.

               (f)  If WFHC enters into a co-promotion agreement with a Third
Party for the promotion of either of the Products to persons or entities other
than Covered Physicians, then WFHC shall furnish Essentia (at Essentia's sole
cost and expense) with copies of the promotional materials WFHC makes available
to its or such Third Party's sales force (including translations thereof, if
available), as the Sales/Marketing Committee may determine appropriate for
release to Essentia.

               (g)  WFHC reserves the right to assign to a Third Party all of
its rights to the Products (including the ANDA relating to the ORTHO-EST(R)
Product and the NDA relating to

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the Esclim(TM) Product) as and upon such terms as WFHC may elect and determine
in its sole and absolute discretion.

5.   SALES/MARKETING COMMITTEE.

               (a)  A marketing committee will be established promptly by WFHC
and Essentia after execution of this Agreement (such committee being referred to
herein as the "Sales/Marketing Committee"). Essentia shall be entitled to
participate in the activities of the Sales/Marketing Committee related to the
development and coordination of the marketing strategy and promotional plans for
the Products in the Territory to Covered Physicians, which activities shall
include:

                    (i)  developing and revising, subject to WFHC's prior
written approval before use (with WFHC to use commercially reasonable efforts to
review and provide its response within 30 days after receipt of the material),
existing and new promotional materials for the Products for in-person promotion
to Covered Physicians to the extent that the same relate specifically to the
marketing of the Products to Covered Physicians;

                    (ii) developing promotional programs for the Products to
Covered Physicians and pharmacies; and

                    (iii) establishing appropriate sampling scheduling for the
Products.

               (b)  The Sales/Marketing Committee shall be composed of four (4)
persons, with Essentia and WFHC each being entitled to designate two (2)
individuals. The initial members shall be designated by each party in writing
promptly following execution of this Agreement. Each party may change its
designated member at any time upon advance written notice to the other party
(for WFHC, notice must be sent to its Vice President, Pharmaceuticals Division;
for Essentia, notices must be sent to its President and COO) of any substitution
of a member. Decisions and recommendations of the Sales/Marketing Committee will
be made by vote of Essentia and WFHC, with each party having one vote. In the
event of a tie, WFHC's Vice President, Pharmaceuticals Division shall have the
deadlock breaking vote. Other than as provided herein, WFHC shall retain
ultimate authority with respect to all strategic matters involving or relating
to the Products.

               (c)  The Sales/Marketing Committee shall meet not less than once
in each Agreement Quarter during the Copromotion Term or as otherwise agreed by
the parties in writing, at such locations as are designated by each party
alternatively. Each party shall bear the costs and expenses of its designated
members that are incurred in connection with the Sales/Marketing Committee
meetings.

               (d)  Essentia shall present a Call Plan to the Sales/Marketing
Committee for review and discussion not less frequently than annually covering a
period not to exceed one year. Each Call Plan shall identify the direct selling
and marketing activities to be conducted by Essentia in an Agreement Quarter
specifically targeting Covered Physicians and shall be subject to the review of
the Sales/Marketing Committee (the call plan so approved being referred to
herein as the "Call Plan"); provided that Essentia shall have the discretion to
determine the particular Covered Physicians to whom it promotes and the
frequency of presentation of the

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Products. Each Call Plan will reflect Essentia's proposed structure for Details
by Essentia sales representatives and will provide that sales representatives
will spend at least thirty percent (30%) of their time during each Detail on the
Products.

               (e)  Essentia shall present its sales force bonus plan to the
Sales/Marketing Committee for review and discussion not less frequently than
annually. Each sales force bonus plan shall describe the criteria for awarding
bonuses to sales representatives based on prescriptions written for the Products
and other products by physicians to whom such representatives have made Details.
Each sales force bonus plan will provide that at least thirty percent (30%) of a
sales representative's bonus opportunity will be directly related to sales of
the Products.

               (f)  Notwithstanding anything in this Section 5 or that might
otherwise imply to the contrary in this Agreement, WFHC shall have strategic
responsibility and sole authority and responsibility for obtaining all legal,
regulatory and medical approvals related to the selling and use of promotional
materials prepared or approved by the Sales/Marketing Committee.

6.   FUNDING OF PROMOTIONAL ACTIVITIES.

               (a)  WFHC shall be solely responsible during the Copromotion Term
for the Costs incurred by it with respect to the following activities related to
the promotion of the Products in the Territory to Covered Physicians
(collectively, the "WFHC Funded Activities"):

                    (i)  reasonable and customary selling and promotional
materials provided by WFHC to Essentia for use with Covered Physicians (except
as otherwise provided in Section 6(b) below);

                    (ii) the cost of samples of the Products up to the
Esclim(TM) Sample Quantity Maximum and the ORTHO-EST(R) Sample Quantity Maximum,
as set forth in Section 8 hereof; and

                    (iii) cost of product training and product training
materials, as set forth in Section 7(b) below.

               (b)  Essentia shall be solely responsible during the Copromotion
Term for the Costs incurred by it with respect to the following activities
related to the promotion of the Products in the Territory to Covered Physicians
(collectively, "Essentia Funded Activities"):

                    (i)  expenses related to changes in selling and promotional
materials requested by Essentia and approved by the Sales/Marketing Committee;

                    (ii) the cost of samples of the Products requested by
Essentia in excess of the Esclim(TM) Sample Quantity Maximum and the
ORTHO-EST(R) Sample Quantity Maximum, as set forth in Section 8 hereof; and

                    (iii) cost of photocopying associated with making copies of
product training and product training materials for the Essentia sales force, as
set forth in Section 7(b) below.

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               (c)  WFHC shall be under no obligation to conduct or develop
symposia, seminars, technical and scientific exhibits and other professional
relations events with respect to the Products or to conduct additional clinical
trials with respect to the Products.

               (d)  For purposes of Sections 6, 7 and 10 hereof, the term
"Costs" means, in the case of the WFHC Funded Activities (other than samples of
Products) or Essentia Funded Activities, the direct, out-of-pocket costs and
expenses paid by WFHC or Essentia in connection with such activities during the
period in question. In the case of Product samples, the term "Costs" means
WFHC's direct out-of-pocket costs and expenses for manufacturing or acquiring
such samples during the period in question.

               (e)  Any marketing and promotional expenses related to the
Products for the Non-Covered Physician market, including all promotional
materials, advertisements, symposia and other promotional events therefor, shall
be borne by WFHC.

7.   TRAINING OF ESSENTIA SALES FORCE.

               (a)  The parties intend that WFHC will provide representatives of
Essentia's sales force with the same or substantially similar training with
respect to promotion of the Products to Covered Physicians as has been given
traditionally to WFHC's sales force in the Territory (it being understood that
such training shall be specific to the Products themselves, as opposed to
general sales training). WFHC and Essentia will hold one initial training
session (the "Initial Training Session"), which shall be held on a mutually
convenient date within sixty (60) days after the Effective Date of this
Agreement, and which will be held at a location mutually acceptable to WFHC and
Essentia. WFHC shall determine and be solely responsible for the content,
development, and associated cost of all training materials used in the Initial
Training Session. Essentia shall designate a reasonable number of
representatives to attend the Initial Training Session who, in turn, will
provide product training on the Products to the balance of Essentia's sales
force.

               All members of the Essentia sales force (including detail
personnel, management, and sales representatives) shall attend a training
program related to the Products, whether as part of the Initial Training Session
or a subsequent training program conducted by Essentia representatives who
attended the Initial Training Session. Essentia shall bear the full cost and
expense of all of its sales force personnel (including management, detail
personnel, sales representatives, and contractors) who attend training programs
related to the Products, without contribution from WFHC. WFHC shall bear the
costs and expenses of its training personnel provided for the Initial Training
Session.

               (b)  WFHC will provide sufficient copies of training materials
for Essentia's representatives who attend the Initial Training Session.
Essentia, however, will be responsible at its sole cost and expense for
photocopying such training materials and providing them to members of its sales
force at subsequent training programs conducted by Essentia. From time to time
as training materials for the Products may be revised by WFHC (the timing and
content of which shall be determined by WFHC in the exercise of its sole and
absolute discretion or as mandated by regulatory agencies or as directed by the
Sales/Marketing Committee), WFHC will

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make such training materials available to Essentia, and Essentia shall be
responsible for photocopying such training materials and providing them to
members of Essentia's sales force.

               (c)  Where any promotional and sales literature and materials,
advertisements, symposia and other promotional events have been developed by
WFHC for the Products in the Territory for Non-Covered Physicians that will also
directly benefit Covered Physicians, WFHC will make such materials available to
Essentia, provided that Essentia reimburses WFHC for its out-of-pocket costs
incurred in developing, printing or duplicating such materials.

               (d)  WFHC reserves and retains title and all rights, including
copyright rights, in and to all written, visual and electronic works and other
materials provided by it to Essentia hereunder, as well as any adaptations
thereof or "derivative works" (as such term is defined in the U.S. Copyright
Code, 17 U.S.C. Section 101 et. seq.) derived or developed by Essentia from or
with such works and materials. Subject to the foregoing and to its obligations
under other terms and conditions of this Agreement, Essentia is granted the
nonexclusive right under this subsection to use, copy, modify, and distribute
such materials only in furtherance of this Agreement and the rights granted to
it hereunder, for the Copromotion Term of this Agreement. Essentia will ensure
that all copyright notices and this permission notice appear on all copies of
the written materials provided by WFHC and all adaptations and derivative works
thereof.

8.   PRODUCT SAMPLES; ADDITIONAL CLINICAL STUDIES.

               (a)  WFHC agrees to provide to Essentia reasonable quantities of
samples of Products in accordance with Section 8(b) below, as requested by
Essentia. Such samples shall be used solely in making Detail calls to Covered
Physicians in the Territory. Shipments of product samples shall require not less
than thirty (30) days advance written notice and shall be subject to the same
shipping schedules as that under which WFHC customarily distributes samples of
the Products to its own sales representatives.

                    Samples of Products (and promotional and sales literature
where made available to Essentia under other provisions of this Agreement) will
be shipped to Essentia's central distribution facility. Essentia shall be
responsible for the further distribution of same to its sales representatives.
All costs of such distribution by Essentia shall be borne solely by Essentia.
Once Essentia accepts shipment of samples of Products from WFHC, Essentia shall
be responsible for all accountability of samples of Products and compliance with
the Prescription Drug Marketing Act, as amended, and other applicable federal,
state and local laws relating to samples. Essentia is further responsible for
adherence by its sales representatives to such laws.

                    Product samples shall have a shelf life of not less than
twelve (12) months, unless otherwise approved by the Sales/Marketing Committee.

                    WFHC shall bear the Product sample costs (as determined in
Section 8(b)) of the Product samples provided to Essentia up to the Sample
Quantity Maximum (as defined in Section 8(b) below) for a given Agreement Year;
provided that any samples of Products requested by Essentia in excess of the
Sample Quantity Maximum for a Product in a given Agreement Year shall require
not less than sixty (60) days advance written notice and shall

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be paid for by Essentia at WFHC's Cost therefor within thirty (30) days after
receipt of WFHC's invoice therefor.

               (b)  WFHC will make available to Essentia for distribution by its
sales representatives in the first Agreement Year up to *** boxes of
Esclim(TM) samples (the "Esclim(TM) Sample Quantity Maximum"). Each box contains
two Esclim(TM) transdermal estrogen patches. For Agreement Years after the first
Agreement Year, the Esclim(TM) Sample Quantity Maximum shall be determined by
the Sales/Marketing Committee.

               (c)  WFHC will make available to Essentia for distribution by its
sales representatives in the first Agreement Year up to *** bottles of
ORTHO-EST(R) samples (the "ORTHO-EST(R) Sample Quantity Maximum"), with each
bottle currently containing a 30-day supply. WFHC reserves the right to change
the number of tablets contained in each ORTHO-EST(R) sample bottle; provided
that WFHC will not change the number of the ORTHO-EST(R) tablets in sample
bottles provided to Essentia unless it also changes the number of tablets per
bottle for ORTHO-EST(R) sample bottles provided by WFHC to Non-Covered
Physicians. For Agreement Years after the first Agreement Year, the ORTHO-EST(R)
Sample Quantity Maximum shall be determined by the Sales/Marketing Committee.

               (d)  Essentia will seek to allocate Product samples to the
highest prescribing Covered Physicians, as identified by Essentia based on data
obtained from IMS America or another prescription reporting service mutually
agreed upon by the parties and the experience of its sales force. In addition,
Essentia will actively seek to cause such Covered Physicians to provide Product
samples to their patients.

               (e)  WFHC shall have sole control over the design and conduct of
any Phase I through V clinical studies relating to the Products, as well as sole
and absolute discretion as to whether to initiate any such studies. As between
WFHC and Essentia, WFHC shall have the exclusive right to use for any purpose
the data resulting from any clinical studies relating to the Products conducted
by it or Essentia, including, but not limited to, product registrations and
product licenses related to the Products, throughout the world.

9.   CERTAIN REGULATORY MATTERS.

               (a)  As between WFHC and Essentia, all regulatory matters
regarding the Products shall remain under the exclusive control of WFHC, subject
to the participation by Essentia in matters related to the marketing of the
Products to Covered Physicians. WFHC will have the sole responsibility, at its
cost and expense, to respond to complaints about the Products and to handle all
returns and recalls of the Products.

               (b)  WFHC shall furnish Essentia with efficacy and safety
information reasonably requested by Essentia to assist it in promoting the
Products to Covered Physicians. Such information shall be treated as
confidential information of WFHC, and shall not be disclosed to Third Parties
without WFHC's prior written approval.

               (c)  Beginning as of the Effective Date of this Agreement, each
party shall promptly notify the other party of any significant event(s) that
affect the marketing of the Products, including, but not limited to, adverse
drug reactions and governmental inquiries,

*** Certain information (indicated by an asterisk) has been omitted from this
    document pursuant to a request for confidential treatment. The omitted
    material has been filed separately with the Securities and Exchange
    Commission.

                                       12
<PAGE>   13

whether within or outside the Territory. WFHC shall have the responsibility for
evaluating such events and reporting such events to applicable regulatory health
authorities in the Territory.

               Essentia shall report all such adverse events involving the
Products learned by it to:

               Director of Regulatory Affairs
               Women First HealthCare, Inc.
               1220 El Camino Real, Suite 400
               San Diego, CA 92130
               Facsimile No.:  (858) 509-3851
               Telephone No.: (858) 509-3836

A MedWatch form or a CIOMS-I form that contains the data elements required for
adverse event reporting is recommended.

               Serious adverse events concerning the Products learned by WFHC
shall be reported by WFHC to Essentia by way of WFHC providing to Essentia any
quarterly or annual Adverse Drug Event reports submitted by WFHC to the FDA at
the time WFHC reports such events to the FDA, and shall be sent to:

               President & COO
               Essentia Pharmaceuticals B.V.
               16690 Swingley Ridge Road, Suite 100
               P.O. Box 679
               Chesterfield, MO  63006-0679
               Facsimile No.: (636) 536-4342
               Telephone No. (636) 536-4500

Serious adverse events for either of the Products (as defined in Section 9(g)
below) learned by Essentia shall be submitted to WFHC within three (3) working
days but no more than four (4) calendar days from the receipt date by Essentia.

               Non-serious adverse events for a Product (as defined in Section
9(g) below) that are spontaneously reported to Essentia shall be submitted to
WFHC no more than one (1) month from the date received by Essentia; provided,
however, that medical and scientific judgment should be exercised in deciding
whether expedited reporting is appropriate in other situations, such as
important medical events that may not be immediately life-threatening or result
in death or hospitalization but my jeopardize the patient or may require
intervention to prevent a serious adverse event outcome.

               (d)  Beginning as of the Effective Date of this Agreement, each
party shall promptly notify the other party in writing of any order, request or
directive of a court or other governmental authority to recall or withdraw the
Products in any jurisdiction. As between WFHC and Essentia, WFHC shall be
responsible, at its sole cost and expense, for the costs of any recall or
withdrawal of the Products.

                                       13
<PAGE>   14

               (e)  Upon being contacted by the Food and Drug Administration
(FDA) or any other federal, state or local agency for any regulatory purpose
pertaining to this Agreement or to the Products, Essentia shall, if not
prohibited by applicable law, immediately notify WFHC and will not respond to
the agency until consulting with WFHC, to the maximum feasible extent; provided,
however, that the foregoing shall not be construed to prevent Essentia in any
way from complying, and Essentia may permit unannounced FDA or similar
inspections authorized by law and respond to the extent necessary to comply,
with its obligation under applicable law.

               (f)  Essentia shall inform WFHC's Director of Regulatory Affairs
of any Product Quality Complaint received within three (3) working days but no
more than five (5) calendar days from the receipt date by Essentia. A "Product
Quality Complaint" is defined as any complaint that questions the purity,
identity, potency or quality of either of the Products, its packaging, or
labeling, or any complaint that concerns any incident that causes the drug
product or its labeling to be mistaken for, or applied to, another article or
any bacteriological contamination, or any significant chemical, physical, or
other change or deterioration in the distributed drug product, or any failure of
one or more distributed batches of the drug product to meet the specifications
therefor in the NDA or ANDA, as applicable, for such Product. Such information
shall be sent to the same address as set forth in Section 9(c) above.

               (g)  A "serious" adverse event for a Product is defined as any
untoward medical occurrence that at any dose for a Product: (i) results in
death; (ii) is life-threatening (as defined below); (iii) requires inpatient
hospitalization or prolongation of existing hospitalization; (iv) results in
persistent or significant disability/incapacity; (v) is a congenital
anomaly/birth defect; (vi) results in drug dependency or drug abuse; (vii) is
cancer; (viii) is a serious medical event (as defined below); or (ix) is an
overdose. A "nonserious" adverse event is defined as that which is not serious.

                    A "life-threatening" adverse event is defined as an event in
which the patient or subject was at immediate risk of death at the time of the
event; it does not refer to an event which hypothetically might have caused
death if it were more severe.

                    A "serious medical event" is defined as a medial event that
may not be immediately life-threatening or result in death or hospitalization
but, based on appropriate medical and scientific judgment, may jeopardize the
patient/subject or may require intervention (e.g., medical, surgical) to prevent
one of the other outcomes listed as a serious definition.

               (h)  WFHC and Essentia will cooperate and establish a mutually
acceptable procedure designed to ensure access by WFHC to samples forming the
basis of a complaint regarding either of the Products received by WFHC. WFHC
will provide Essentia with samples of return labels for this purpose.

               (i)  As between WFHC and Essentia, WFHC shall be responsible for
handling all medical inquiries concerning each Product within the Territory,
including without limitation responding to questions concerning permitted and
off-label uses of each Product, request for journal articles, the administration
of and response to medical inquiries concerning the Products by consumers,
physicians, pharmacists and other health care professionals, including those

                                       14
<PAGE>   15

forwarded by sales representatives and field force personnel promoting the
Products. Essentia shall refer all routine medical information requests in
writing to:

               Director of Regulatory Affairs
               Women First HealthCare, Inc.
               1220 El Camino Real, Suite 400
               San Diego, CA 92130
               Facsimile No.: (858) 509-3851
               Telephone No.: (858) 509-3836

               Urgent medical information requests shall be referred by
telephone to:

               Medical Director
               Women First HealthCare, Inc.
               1220 El Camino Real, Suite 400
               San Diego, CA 92130
               Facsimile No.: (858) 509-3851
               Telephone No.: (858) 509-3836

10.  COMPLIANCE WITH LAW AND LABELING.

               (a)  Each party shall maintain in full force and effect all
necessary licenses, permits and other authorizations required by law to carry
out its duties and obligations under this Agreement. Each party shall comply
with all laws, ordinances, guidelines, rules and regulations (collectively,
"Laws") applicable to its activities under this Agreement, including without
limitation, any requirements of any product license applicable to the Products
in the Territory; provided, however, that Essentia shall be solely responsible
for compliance with those Laws pertaining to the activities conducted by it
hereunder (including, without limitation, those Laws that apply to documentation
and records retention pertaining to the distribution and use of samples of
Products by it under this Agreement), notwithstanding that the FDA may, as a
matter of law, be entitled to hold WFHC accountable or responsible (whether
primarily or secondarily) for failure of Essentia to comply with such Laws. The
parties will reasonably cooperate with one another with the goal of ensuring
full compliance with Laws. WFHC shall be responsible for all labeling changes to
the Products.

               (b)  Essentia shall make no representations or warranties
relative to the Products that conflict or are inconsistent with the NDA or ANDA,
as applicable, applicable law, and the FDA-approved label for the Products.
Essentia shall be responsible for any Costs incurred by WFHC resulting from
statements made by Essentia's sales representatives that relate to the safety or
efficacy of the Products that are not in compliance with applicable law or have
not been authorized by WFHC in advance in writing.

                                       15
<PAGE>   16

11.  COPROMOTION COMPENSATION.

               (a)  As compensation for services rendered by Essentia with
respect to the Esclim(TM) Product during the Copromotion Term and its agreements
hereunder, WFHC shall pay to Essentia a fee (the "Esclim(TM) Performance Fee")
with respect to each Agreement Year during the term hereof equal to fifty
percent (50%) of those Net Esclim(TM) Sales Attributable to Covered Physicians
that are in excess of the Baseline Annual Esclim(TM) Sales Attributable to
Covered Physicians for such Agreement Year. As compensation for services
rendered by Essentia with respect to the ORTHO-EST(R) Product during the
Copromotion Term and its agreements hereunder, WFHC shall pay to Essentia a fee
(the "ORTHO-EST(R) Performance Fee") with respect to each Agreement Year during
the term hereof equal to fifty percent (50%) of those Net ORTHO-EST(R) Sales
Attributable to Covered Physicians that are in excess of the Baseline Annual
ORTHO-EST(R) Sales Attributable to Covered Physicians for such Agreement Year.

               (b)  For purposes of this Agreement:

               "Average Selling Price per Esclim(TM) Prescription" means, for
any Agreement Year (or any Agreement Quarter or six-month or nine-month period
prior to the end of an Agreement Year) for the Esclim(TM) Product, the total Net
Sales of the Esclim(TM) Product in the Territory for the applicable period from
prescriptions written by all physicians of all specialties and practices,
divided by the total number of retail and mail order prescriptions (TRx) for the
Esclim(TM) Product that are written or ordered in such applicable period by
Covered and Non-Covered Physicians. The number of retail and mail order
prescriptions (TRx) shall be determined by the National Prescriptions Audit as
issued by IMS America or another prescription reporting service mutually agreed
upon by the parties.

               "Baseline Annual Esclim(TM) Sales Attributable to Covered
Physicians" for each Agreement Year shall mean the product of: (i) the Baseline
Agreement Year Esclim(TM) Prescriptions for such Agreement Year multiplied by
(ii) the Average Selling Price per Esclim(TM) Prescription for such Agreement
Year.

               "Baseline Agreement Year Esclim(TM) Prescriptions" for an
Agreement Year means that number of Covered Physician Prescriptions for the
Esclim(TM) Product written and dispensed during an Agreement Year equal to the
actual number of Covered Physician Prescriptions for the Esclim(TM) Product
written and dispensed during 2000, as determined by the X-Ponent Data as issued
by IMS America or similar data provided by another prescription reporting
service mutually agreed upon by the parties.

               "Baseline Quarterly Esclim(TM) Prescriptions" shall mean:

               (i)  For the first Agreement Year, that number of Covered
                    Physician Esclim(TM) Prescriptions for each calendar quarter
                    during the first Agreement Year determined by mutual
                    agreement of the parties based on the IMS America data for
                    2000 as soon as practicable after such date is available;
                    provided that in no event shall the sum of the Baseline
                    Quarterly Esclim(TM) Prescriptions for the first Agreement
                    Year be less than the Baseline Agreement Year
                    Esclim(TM) Prescriptions for such Agreement Year; and

                                       16
<PAGE>   17

               (ii) For the second Agreement Year and the third Agreement Year,
                    if applicable, the quotient of (1) the Baseline Agreement
                    Year Esclim(TM) Prescriptions for such Agreement Year
                    divided (2) by four.

               "Covered Physician Esclim(TM) Prescriptions" shall equal the
number of retail and mail order prescriptions (TRx) for the Esclim(TM) Product
that are written or ordered by Covered Physicians and dispensed by pharmacies as
determined by the X-Ponent Data as issued by IMS America or similar data
provided by another prescription reporting service mutually agreed upon by the
parties.

               "License Cost per Esclim(TM) Prescription" shall mean WFHC's
license royalty payable to Laboratoires Fournier S.A. pursuant to Section 3.3(i)
of the Fournier Agreement calculated on a per prescription basis for the
applicable period, with such calculation to be made by WFHC in good faith.

               "Net Esclim(TM) Sales Attributable to Covered Physicians" means,
for any Agreement Year (or any Agreement Quarter or six-month or nine-month
period prior to the end of an Agreement Year), a number equal to the product of
(i) the number of Covered Physician Esclim(TM) Prescriptions for the applicable
period multiplied by (ii) the difference of (A) the Average Selling Price per
Esclim(TM) Prescription for such applicable period minus (B) the License Cost
per Esclim(TM) Prescription for such applicable period.

               (c)  For purposes of this Agreement:

               "Average Selling Price per ORTHO-EST(R) Prescription" means, for
any Agreement Year (or any Agreement Quarter or six-month or nine-month period
prior to the end of an Agreement Year) for the ORTHO-EST(R) Product, the total
Net Sales of the ORTHO-EST(R) Product in the Territory for the applicable period
from prescriptions written by all physicians of all specialties and practices,
divided by the total number of retail and mail order prescriptions (TRx) for the
ORTHO-EST(R) Product that are written or ordered in such applicable period by
Covered and Non-Covered Physicians. The number of retail and mail order
prescriptions (TRx) shall be determined by the National Prescriptions Audit as
issued by IMS America or another prescription reporting service agreed upon by
the parties.

               "Baseline Annual ORTHO-EST(R) Sales Attributable to Covered
Physicians" for each Agreement Year shall mean the product of: (i) the Baseline
Agreement Year Esclim(TM) Prescriptions for such Agreement Year, multiplied by
(ii) the Average Selling Price per ORTHO-EST(R) Prescription for such Agreement
Year.

               "Baseline Agreement Year ORTHO-EST(R) Prescriptions" for an
Agreement Year means that number of Covered Physician Prescriptions for the
ORTHO-EST(R) Product written and dispensed during an Agreement Year equal to the
actual number of Covered Physician Prescriptions for the ORTHO-EST(R) Product
written and dispensed during 2000, as determined by the X-Ponent Data as issued
by IMS America or similar data provided by another prescription reporting
service mutually agreed upon by the parties.

               "Baseline Quarterly ORTHO-EST(R) Prescriptions" shall mean:

                                       17
<PAGE>   18

               (i)  For the first Agreement Year, that number of Covered
                    Physician ORTHO-EST(R) Prescriptions for each calendar
                    quarter during the first Agreement Year determined by mutual
                    agreement of the parties based on the IMS America data for
                    2000 as soon as practicable after such data is available;
                    provided that in no event shall the sum of the Baseline
                    Quarterly ORTHO-EST(R) Prescriptions for the first Agreement
                    Year be less than the Baseline Agreement Year
                    ORTHO-EST(R) Prescriptions for such Agreement Year; and

               (ii) For the second Agreement Year and the third Agreement Year,
                    if applicable, the quotient of (1) the Baseline Agreement
                    Year ORTHO-EST(R) Prescriptions for such Agreement Year
                    divided (2) by four.

               "Covered Physician ORTHO-EST(R) Prescriptions" shall equal the
number of retail and mail order prescriptions (TRx) for the ORTHO-EST(R) Product
that are written or ordered by Covered Physicians and dispensed as determined by
X-Ponent Data as issued by IMS America or similar data provided by another
prescription reporting service mutually agreed upon by the parties.

                "Net ORTHO-EST(R) Sales Attributable to Covered Physicians"
means, for any Agreement Year (or any Agreement Quarter or six-month or
nine-month period prior to the end of an Agreement Year), a number equal to the
product of (i) the number of Covered Physician ORTHO-EST(R) Prescriptions for
the applicable period multiplied by (ii) the Average Selling Price per
ORTHO-EST(R) Prescription for such applicable period.

               (d)  In order for Essentia to receive its Esclim(TM) Performance
Fee on a quarterly basis, as opposed to WFHC waiting until the end of the year
and making a lump sum (if applicable) of the amount that may be due Essentia
under Section 11(g), WFHC shall, subject to Section 11(g) below, pay to
Essentia, on a quarterly basis for each of the first three Agreement Quarters in
any Agreement Year, an amount equal to the difference between:

                    (i)  *** of the amount by which (A) Net Esclim(TM) Sales
Attributable to Covered Physicians for such Agreement Quarter and all previous
Agreement Quarters during such Agreement Year exceeds (B) the product of (1) the
sum of the Baseline Esclim(TM) Quarterly Prescriptions for such applicable
period times (2) the Average Selling Price per Esclim(TM) Prescription for such
applicable period, less

                    (ii) all compensation previously paid to Essentia pursuant
to this Section 11 with respect to Net Esclim(TM) Sales Attributable to Covered
Physicians during such Agreement Year.

If (i) less (ii) is less than zero for a given Agreement Quarter, no payment
shall be made by WFHC with respect to such Agreement Quarter.

               (e)  In order for Essentia to receive its ORTHO-EST(R)
Performance Fee on a quarterly basis, as opposed to WFHC waiting until the end
of the year and making a lump sum

*** Certain information (indicated by an asterisk) has been omitted from this
    document pursuant to a request for confidential treatment. The omitted
    material has been filed separately with the Securities and Exchange
    Commission.

                                       18
<PAGE>   19

(if applicable) of the amount that may be due Essentia under Section 11(g), WFHC
shall, subject to section 11(g) below, pay to Essentia, on a quarterly basis for
each of the first three Agreement Quarters in any Agreement Year, an amount
equal to the difference between:

                    (i)  *** of the amount by which (A) Net ORTHO-EST(R) Sales
Attributable to Covered Physicians for such Agreement Quarter and all previous
Agreement Quarters during such Agreement Year exceeds (B) the product of (1) the
sum of the Baseline ORTHO-EST(R) Quarterly Prescriptions for such applicable
period times (2) the Average Selling Price per ORTHO-EST(R) Prescription for
such applicable period, less

                    (ii) all compensation previously paid to Essentia pursuant
to this Section 11 with respect to Net ORTHO-EST(R) Sales Attributable to
Covered Physicians during such Agreement Year.

If (i) less (ii) is less than zero for a given Agreement Quarter, no payment
shall be made by WFHC with respect to such Agreement Quarter.

               (f)  No separate payments shall be made for the fourth Agreement
Quarter in any Agreement Year. Instead, at the end of each such Agreement Year,
a final reconciliation shall be conducted by comparing the amount to which
Essentia is otherwise entitled for such Agreement Year pursuant to Section 11(a)
above against the sum of all amounts (if any) previously paid to Essentia
pursuant to Sections 11(d) and 11(e) for prior Agreement Quarters during such
Agreement Year. If the calculation determines that Essentia is due further
compensation (or has been overcompensated by WFHC) as a result of any quarterly
payments made by WFHC with respect to the first three quarters of any Agreement
Year, the balance due to Essentia (or to be refunded by Essentia) shall be
computed and paid by the applicable party to the other within ninety (90) days
after the end of such Agreement Year.

               (g)  Compensation due Essentia under this Section 11 shall be
calculated and paid within 60 days after the end of each Agreement Quarter
(ninety days after the fourth Agreement Quarter) during the Copromotion Term, in
accordance with Sections 11(a)-(f) and 12 hereof. Any payments not made when due
under Sections 11(a)-(f) shall bear interest at the rate of ten percent (10%)
per annum (or the highest rate permitted by applicable law, whichever is the
lower) on the unpaid balance from the date due until paid in full.

               (h)  WFHC shall bear the costs of obtaining the IMS data or
similar data provided by another prescription reporting service mutually agreed
upon by the parties required to calculate the Average Selling Price per
Esclim(TM) Prescription and the Average Selling Price per ORTHO-EST(R)
Prescription. Essentia shall obtain the IMS America data (or similar data
provided by another prescription reporting service mutually agreed upon by the
parties) necessary to calculate the actual number of Covered Physician
Prescriptions for the Esclim(TM) Product and the actual number of Covered
Physician Prescriptions for the ORTHO-EST(R) Product written and dispensed by
pharmacies during 2000, and WFHC shall reimburse Essentia for the actual cost of
obtaining such data; provided that WFHC's reimbursement obligation shall not
exceed ***. Essentia shall bear the costs of obtaining the IMS data or
similar data provided by another prescription reporting service mutually agreed
upon by the parties required to calculate the Covered Physician Esclim(TM)
Prescriptions and the Covered Physician

*** Certain information (indicated by an asterisk) has been omitted from this
    document pursuant to a request for confidential treatment. The omitted
    material has been filed separately with the Securities and Exchange
    Commission.

                                       19
<PAGE>   20

ORTHO-EST(R) Prescriptions. Essentia shall make the data it obtains available to
WFHC or to an independent third party selected by the parties to make the
parties' calculations with respect to Covered Physician Prescriptions.

12.  PAYMENTS AND REPORTING.

               (a)  WFHC shall furnish Essentia, within 60 days after the end of
each Agreement Quarter (within 90 days at the end of each Agreement Year), a
report setting forth in reasonable detail the calculation of Net Esclim(TM)
Sales Attributable to Covered Physicians for such Agreement Quarter (and
Agreement Year) and the calculation of Net ORTHO-EST(R) Sales Attributable to
Covered Physicians for such Agreement Quarter (and Agreement Year), and the
calculation of Essentia's compensation under Section 11 with respect to such
period (and, in addition to a report for the fourth Agreement Quarter, with
respect to the entire Agreement Year).

               (b)  All payments to a party under this Agreement shall be made
by wire transfer in immediately available funds in legal currency of the United
States and shall be delivered to the account of such party designated by it in
writing from time to time.

               (c)  The parties will maintain complete and accurate books and
records in sufficient detail to enable verification of the Net Esclim(TM) Sales
Attributable to Covered Physicians, the Net ORTHO-EST(R) Sales Attributable to
Covered Physicians and the basis for calculating the compensation paid by WFHC
to Essentia hereunder. Either party may demand an audit of the other party's
relevant books and records in order to verify the other's reports on the
aforesaid matters. Upon reasonable prior notice to the party to be audited, the
independent public accountants of the other party shall have access to the
relevant books and records of the party to be audited in order to conduct a
review or audit thereof and, in the case of the Esclim(TM) Product, the
independent accountants of Laboratoires Fournier S.A. shall have access to the
books and records of Essentia in order to conduct a review or audit thereof.
Such access shall be available during normal business hours not more than once
each calendar year during the Copromotion Term and only until two years after
the relevant period in question. The accountants shall be entitled to report
their conclusions and calculations to the party requesting the audit, except
that in no event shall the accountants disclose the names of customers of either
party or the prices, discounts, rebates, or other terms of sale charged by WFHC
for the Products.

                    The party requesting the audit shall bear the full cost of
the performance of any such audit except as hereinafter set forth. If, as a
result of any inspection of the books and records of either party, it is shown
that such party's payments to the other under this Agreement were less than the
amount which should have been paid, then the audited party shall make all
payments required to be made to eliminate any discrepancy revealed by said
inspection within 30 days after the other party's demand therefor. Furthermore,
if the payments were less than the amount which should have been paid by an
amount in excess of five percent (5%) of the payments actually made during the
period in question, the party responsible for the discrepancy shall also
reimburse the auditing party for its out-of-pocket costs of such inspection.

                                       20
<PAGE>   21

13.  COPROMOTION TERM AND TERMINATION.

               (a)  The Copromotion Term shall be for two (2) years and shall
begin effective April 6, 2001 and shall end on March 31, 2003, unless terminated
earlier in accordance with Section 13(b), 13(c) or 13(d) below or unless
extended by the parties' mutual agreement in accordance with Section 13(e) below
(the "Copromotion Term").

               (b)  Essentia may terminate the Copromotion Term immediately upon
written notice of termination given to WFHC if WFHC has breached a material
obligation or duty under this Agreement that is continuing thirty (30) days
after Essentia has advised WFHC in writing of the nature of said breach.

               (c)  WFHC may terminate the Copromotion Term upon the occurrence
of any of the following:

                    (i)  Upon sixty (60) days' prior written notice to Essentia,
                         if:

                    (A)  Covered Physician Esclim(TM) Prescriptions for an
                         Agreement Year do not exceed the number of Covered
                         Physician Esclim(TM) Prescriptions for such Agreement
                         Year mutually agreed upon by the parties in good faith
                         within thirty (30) days after they receive the data
                         necessary to calculate the Baseline Agreement Year
                         Esclim(TM) Prescriptions ***; or

                    (B)  Aggregate Covered Physician Esclim(TM) Prescriptions
                         for each Agreement Quarter during any two (2)
                         consecutive Agreement Quarters do not exceed the
                         Baseline Quarterly Esclim(TM) Prescriptions for such
                         two Agreement Quarters; or

                    (C)  Covered Physician ORTHO-EST(R) Prescriptions for an
                         Agreement Year do not exceed the number of Covered
                         Physician ORTHO-EST(R) Prescriptions for such Agreement
                         Year mutually agreed upon by the parties in good faith
                         within thirty (30) days after they receive the data
                         necessary to calculate the Baseline Agreement Year
                         ORTHO-EST(R) Prescriptions (***

*** Certain information (indicated by an asterisk) has been omitted from this
    document pursuant to a request for confidential treatment. The omitted
    material has been filed separately with the Securities and Exchange
    Commission.

                                       21
<PAGE>   22

                         ***); or

                    (D)  Aggregate Covered Physician ORTHO-EST(R) Prescriptions
                         for each Agreement Quarter during any two (2)
                         consecutive Agreement Quarters do not exceed the
                         Baseline Quarterly ORTHO-EST(R) Prescriptions for such
                         two Agreement Quarters.

                    (ii) Upon written notice to Essentia, if WFHC has
permanently ceased manufacturing or marketing either of the Products;

                    (iii) Immediately upon written notice of termination given
to Essentia, (A) if WFHC's rights to obtain supplies of the ORTHO-EST(R) Product
or to use the ORTHO-EST(R) Trademark under the ORTHO-EST(R) Agreement are
terminated for any reason or are limited in any material respect or (B) if
WFHC's rights to obtain supplies of the Esclim(TM) Product or to market, use,
distribute and sell the Esclim(TM) Product or to use the Esclim(TM) Trademark
under the Fournier Agreement are terminated for any reason or are limited in any
material respect; or

                    (iv) Immediately upon written notice of termination given to
Essentia, if Essentia has breached a material obligation or duty under this
Agreement that is continuing 30 days after WFHC has advised Essentia in writing
of the nature of the breach or default.

               (d)  If during the Copromotion Term Essentia experiences a
"change in control," Essentia will promptly notify WFHC in writing of same, and
WFHC shall be entitled at any time within one hundred twenty (120) days after
receipt of such notification, in the exercise of its sole and absolute
discretion, upon 30 days written notice to Essentia, to terminate the
Copromotion Term. For purposes of this Agreement, the term "change in control"
shall mean any sale of voting securities or sale of assets (whether by sale,
merger, consolidation, share exchange, or otherwise) which, directly or
indirectly, (i) transfers over 50% of the assets of Essentia to any Person other
than an Affiliate of Essentia or (ii) results in any Person becoming the
beneficial owner, directly or indirectly, of securities of Essentia representing
over fifty percent (50%) of the combined voting power of Essentia's then
outstanding securities. This termination right may be exercised by WFHC each
time there is a change in control, whether or not exercised with respect to an
earlier change in control. Each party shall continue to fulfill its duties
hereunder during such 30-day notice period.

               For purposes of this paragraph 13(d) only, "Person" shall have
the meaning used in section 13(d) and 14(d) of the Securities Exchange Act of
1934, as amended, and "beneficial ownership" shall be determined pursuant to
Rule 13d-3 under the Securities Exchange Act of 1934, as amended.

               (e)  The Copromotion Term may be extended one year upon the
mutual agreement of the parties, it being understood that neither party shall be
under any obligation, express or implied, to do so. In order to be binding upon
either party, any such extension, and the terms governing such extension, must
be evidenced by a written agreement executed by duly authorized representatives
of both parties.

*** Certain information (indicated by an asterisk) has been omitted from this
    document pursuant to a request for confidential treatment. The omitted
    material has been filed separately with the Securities and Exchange
    Commission.

                                       22
<PAGE>   23

               (f)  Neither the termination nor expiration of the Copromotion
Term 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 the Copromotion Term by a party shall not be an exclusive remedy,
but shall be in addition to any legal or equitable remedies that may be
available to the terminating party.

               (g)  If the Copromotion Term is terminated by either party prior
to the completion of an Agreement Quarter, Essentia shall be entitled to receive
a pro rata portion of the compensation which it would have been entitled to
receive under Section 11 had the Copromotion Term been in effect for the entire
Agreement Quarter (based on the number of days that Essentia was responsible for
marketing the Product to Covered Physicians in the Territory during such
Agreement Quarter).

               (h)  Upon the termination or expiration of the Copromotion Term,
Essentia shall promptly cease all of its promotion activities pursuant to this
Agreement, discontinue any use of the Trademarks, return to WFHC all sales
training, promotional, marketing material, WFHC call lists and computer files,
and any remaining samples of the Products (i.e., not already distributed or
destroyed with destruction certified by Essentia) that may have been supplied to
Essentia by WFHC under this Agreement. WFHC shall be entitled to promote the
Products to all Covered Physicians thereafter without compensation or obligation
to Essentia. It is understood that the names and addresses of any Covered
Physicians to whom Essentia may have made calls are not considered Confidential
Information.

               (i)  Notwithstanding the expiration or termination of the
Copromotion Term, this Agreement shall be deemed to continue and shall not be
deemed terminated in its entirety and of no further force and effect unless and
until neither party has any further obligation to the other party in accordance
with the terms hereof.

14.  INDEMNIFICATION AND INSURANCE.

               (a)  WFHC shall defend, indemnify and hold Essentia and its
employees, agents, officers, directors and affiliates (each an "Essentia Party")
harmless from and against any and all losses, liabilities, obligations, claims,
fees (including, without limitation, attorneys fees), expenses incurred by an
Essentia Party that are claimed by any Third Party and that result from or arise
in connection with (i) the breach of any covenant, representation or warranty of
WFHC contained in this Agreement, (ii) the sale or distribution of the Products
by WFHC or any licensee or affiliate thereof, including, without limitation, any
claim of patent infringement, (iii) any product liability claim related to the
Products, including, without limitation, the use by any person of any Product
that was manufactured, sold or distributed by WFHC or any licensee or affiliate
thereof, (iv) any contamination of or defect in a Product, and (v) breach by
WFHC of its obligations under Section 10 hereof. Notwithstanding anything in
this Section 14(a), WFHC shall not be obligated to indemnify an Essentia Party
for any liability related to a Product for which Essentia has assumed an
indemnification obligation under Section 14(b) below.

               (b)  Essentia shall defend, indemnify and hold WFHC and its
employees, agents, officers, directors and affiliates (each, a "WFHC Party")
harmless from and against any and all losses, liabilities, obligations, claims,
fees (including, without limitation, attorneys' fees),

                                       23
<PAGE>   24

expenses and lawsuits brought against or incurred by a WFHC Party by a Third
Party resulting from or arising in connection with (i) the breach by Essentia of
any covenant, representation or warranty of Essentia contained in this
Agreement, (ii) any contamination, mislabeling, or adulteration of any samples
of Products while such samples are under the control of Essentia or breach by
Essentia of its obligations under Section 8 hereof and/or (iii) breach by
Essentia of its obligations under Section 10 hereof.

               (c)  To receive the benefits of the indemnity under clauses (a)
or (b) above, as applicable, an indemnified party must (i) give the indemnifying
party written notice of any claim or potential claim promptly after the
indemnified party receives notice of any such claim; (ii) allow the indemnifying
party to assume the control of the defense and settlement (including all
decisions relating litigation, defense and appeal) of any such claim (so long as
it has confirmed its indemnification obligation responsibility to such
indemnified party under this Section 14); and (iii) so long as such cooperation
does not vitiate any legal privilege to which it is entitled, reasonably
cooperate with the indemnifying party in its defense of the claim (including,
without limitation, making documents and records available for review and
copying and making persons within its/his/her control available for pertinent
testimony). If the indemnifying party defends the claim, an indemnified party
may participate in, but not control, the defense of such claim at its/his/her
sole cost and expense. An indemnifying party shall have no liability under this
Section 14 as to any claim for which settlement or compromise of such claim or
an offer of settlement or compromise of such claim is made by an indemnified
party without the prior consent of the indemnifying party.

               (d)  Essentia acknowledges and agrees that any Essentia sales
force personnel (including contract sales personnel, telemarketers, detail
personnel, independent contractors, employees, and agents) used by Essentia to
fulfill its obligations under this Agreement are not, and are not intended to be
or be treated as, employees of WFHC or any of its Affiliates, and that such
individuals are not eligible to participate in any "employee benefit plans," as
such term is defined in section 3(3) of ERISA, that are sponsored by WFHC or any
of its Affiliates. WFHC shall not be responsible to Essentia, to any employees,
agents, contractors, telemarketers, or other personnel of Essentia used by it to
perform its obligations under this Agreement, or to any governmental entity for
any compensation or benefits (including, without limitation, vacation and
holiday remuneration, healthcare coverage or insurance, life insurance, pension
or profit-sharing benefits and disability benefits), payroll-related taxes or
withholdings, or any governmental charges or benefits (including without
limitation unemployment and disability insurance contributions or benefits and
workmen' compensation contributions or benefits) that may imposed upon or be
related to the performance by Essentia and any of its employees, agents,
contractors, telemarketers, detail or other personnel used by Essentia to
discharge its obligations under this Agreement, all of which shall be the sole
responsibility of Essentia, even if it is subsequently determined by any court,
the IRS or any other governmental agency that such individual may be a common
law employee of WFHC or any of its Affiliates. All such matters of compensation,
benefits and other terms of employment for any employee, agent, contractor,
telemarketer, detail or other personnel used by Essentia to fulfill its
obligations hereunder shall be solely a matter between Essentia and such
individual(s) or entities.

                                       24
<PAGE>   25

                    Essentia will indemnify, defend, and hold harmless each WFHC
Party from and against any damages, liability, loss and costs that may be paid
or payable by any such WFHC Party resulting from or in connection with any claim
or other cause of action asserted by:

                    (i)  any employees, agents, contractors, telemarketers,
detail personnel, or other personnel of Essentia used by it to perform its
obligations under this Agreement, or

                    (ii) by any Third Party (including federal, state or local
governmental authorities) with respect to:

                         (A)  any payment or obligation to make a payment to any
employees, agents, contractors, telemarketers, or other personnel used by
Essentia to perform its obligations under this Agreement with respect to any
compensation, benefits of any type under any employee benefit plan (as such term
is defined above), and any other bonus, stock option, stock purchase, incentive,
deferred compensation, supplemental retirement, severance and other similar
fringe or employee benefit plans, programs or arrangements that may be sponsored
at any time by WFHC or any of its Affiliates or by Essentia or any of its
Affiliates, even if it is subsequently determined by any court, the IRS or any
other governmental agency that any such employee, agent, contractor,
telemarketer, detail and other personnel used by Essentia to discharge its
obligations hereunder may be a common law employee of WFHC or any of its
Affiliates; and

                         (B)  the payment or withholding of any contributions,
payroll taxes, or any other payroll-related item by or on behalf of Essentia or
any of its employees, agents, contractors, telemarketers, and other personnel
with respect to which WFHC, Essentia or any of Essentia's employees, agents,
contractors, telemarketers, and other personnel may be responsible hereunder or
pursuant to applicable law to pay, make, collect, withhold or contribute, even
if it is subsequently determined by any court, the IRS or by any other
governmental agency that any such employee, agent, contractor, telemarketer, and
other person used by Essentia to discharge its obligations hereunder may be a
common law employee of WFHC or any of its Affiliates.

Nothing contained in this Section 14(d) is intended to or will effect or limit
any compensation payable by WFHC to Essentia for the services rendered by
Essentia pursuant to this Agreement.

               (e)  Essentia shall use commercially reasonable efforts to
maintain insurance against such risks (including product liability) and upon
such terms (including coverages, deductible limits and self-insured retentions)
as is customary for the activities to be conducted by it under this Agreement
and is appropriate to cover its indemnification obligations hereunder. Without
limiting the foregoing, Essentia shall carry, during the term of this Agreement
and for five years thereafter, comprehensive general liability insurance,
including product liability and contractual liability endorsements, in an amount
of not less than $5,000,000 per occurrence and $10,000,000 in the aggregate.
Such policy shall name WFHC as an additional insured party thereunder and shall
be endorsed to provide for thirty (30) days notice to WFHC of cancellation or
material change in the coverage before such cancellation or change takes effect.
Such insurance shall be with insurance companies having a Best's Insurance
rating of A:X or better. Essentia shall furnish to WFHC evidence of such
insurance, upon request. Such insurance

                                       25
<PAGE>   26

information shall be kept in confidence in the same manner as any other
confidential information disclosed by Essentia to WFHC hereunder. WFHC shall
cause Essentia to be an additional insured party under WFHC's comprehensive
general liability insurance.

15.  CONFIDENTIALITY.

               (a)  Each party acknowledges that it may receive confidential or
proprietary information of the other party in the performance of this Agreement.
Each party shall hold confidential and shall not, directly or indirectly,
disclose, publish or use for the benefit of any Third Party or itself, except in
carrying out its duties hereunder, any confidential or proprietary information
of the other party, without first having obtained the furnishing party's written
consent to the such disclosure or use. "Confidential or proprietary information"
shall include, inter alia, know-how, scientific information, clinical data,
efficacy and safety data, adverse event information, formulas, methods and
processes, specifications, pricing information (including discounts, rebates and
other price adjustments) and other terms and conditions of sales, customer
information, business plans, and all other intellectual property. This
restriction shall not apply to any information within the following categories:

                    (i)  information that is known to the receiving party or its
Affiliates prior to the time of disclosure to it, to the extent evidenced by
written records or other competent proof;

                    (ii) information that is independently developed by
employees, agents, or independent contractors of the receiving party or its
Affiliates without reference to or reliance upon the information furnished by
the disclosing party, as evidenced by written records or other competent proof;

                    (iii) information disclosed to the receiving party or its
Affiliates by a Third Party that has a right to make such disclosure;

                    (iv) information that is contained in any written
promotional material prepared by WFHC for use in connection with the Products;
or

                    (v)  any other information that becomes part of the public
domain through no fault or negligence of the receiving party.

               The receiving party shall also be entitled to disclose the other
party's Confidential Information that is required to be disclosed in compliance
with applicable laws or regulations (including, without limitation, to comply
with SEC, Nasdaq or stock exchange disclosure requirements), or by order of any
governmental body or a court of competent jurisdiction; provided that the party
required to disclose such information shall use all reasonable efforts to obtain
confidential treatment of such information by the agency or court.

               (b)  This obligation shall survive the termination or expiration
of this Agreement for five (5) years.

               (c)  The confidentiality obligations described above shall
supersede the Confidentiality Agreement dated as of February 1, 2001 between the
parties and shall govern any

                                       26
<PAGE>   27

and all information disclosed by either party to the other pursuant thereto, and
shall be retroactively effective to the date of such Confidential Disclosure
Agreement.

               (d)  It is expressly understood and agreed that Essentia may
disclose confidential information to members of its board of directors who are
not employees of Essentia (and to consultants who have received WFHC's prior
written approval), provided that Essentia shall ensure that such directors and
consultants are bound by a written obligation of confidentiality to Essentia as
regards confidential information hereunder that is disclosed to them that is
reasonably satisfactory to WFHC.

16.  REPRESENTATIONS AND WARRANTIES.

               (a)  WFHC represents and warrants to Essentia that (i) the
execution, delivery and performance of this Agreement by WFHC does not conflict
with, or constitute a breach of or under, any order, judgment, agreement or
instrument to which WFHC is a party; (ii) the execution, delivery and
performance of this Agreement by WFHC does not require the consent of any person
or the authorization of (by notice or otherwise) any governmental or regulatory
authority; (iii) the rights granted by WFHC to Essentia hereunder do not
conflict with any rights granted by WFHC to any Third Party; and (iv) WFHC owns
the NDA for the Esclim(TM) Product and the ANDA for the ORTHO-EST(R) Product;
provided that in the case of the Esclim(TM) Product, WFHC may be required to
transfer the NDA to Laboratoires Fournier S.A. following termination of the
Fournier Agreement (as defined below) under certain circumstances.

               (b)  Essentia represents and warrants to WFHC that (i) the
execution, delivery and performance of this Agreement by Essentia does not
conflict with, or constitute a breach of or under, any order, judgment,
agreement or instrument to which Essentia is a party; and (ii) the execution,
delivery and performance of this Agreement by Essentia does not require the
consent of any person or the authorization of (by notice or otherwise) any
governmental or regulatory authority.

17.  LIMITATION OF LIABILITY.

               (a)  EXCEPT WITH RESPECT TO THE PARTIES' RESPECTIVE
INDEMNIFICATION OBLIGATIONS FOR THIRD PARTY CLAIMS PURSUANT TO SECTION 14 AND
WITHOUT LIMITING THE PARTIES ABILITIES TO SEEK INJUNCTIVE RELIEF OR SPECIFIC
PERFORMANCE OF THIS AGREEMENT, THE PARTIES EXPRESSLY AGREE THAT, WITH RESPECT TO
ANY CLAIM BY EITHER WFHC OR ESSENTIA AGAINST THE OTHER ARISING OUT OF ANY BREACH
OF THIS AGREEMENT, THE LIABILITY OF THE BREACHING PARTY TO THE NON-BREACHING
PARTY FOR SUCH BREACH SHALL BE LIMITED UNDER THIS AGREEMENT OR OTHERWISE AT LAW
OR EQUITY TO DIRECT MONEY DAMAGES ONLY, AND IN NO EVENT SHALL A PARTY BE LIABLE
TO THE OTHER FOR INDIRECT, INCIDENTAL, PUNITIVE, EXEMPLARY OR CONSEQUENTIAL
DAMAGES, EVEN IF ADVISED OF THE POSSIBILITY OF THE SAME.

               (b)  Essentia acknowledges and agrees that WFHC shall not be
liable and shall have no responsibility to Essentia (except as contemplated by
Section 4(d) above) in the event (i)

                                       27
<PAGE>   28

WFHC receives insufficient quantities of the Products from Laboratoires Fournier
S.A., in the case of the Esclim(TM) Product, or Ortho-McNeil Pharmaceutical,
Inc. or a replacement manufacturer selected by WFHC under the ORTHO-EST(R)
Agreement, in the case of the ORTHO-EST(R) Product, to meet demand for such
Products or (ii) WFHC's rights under the ORTHO-EST(R) Agreement or the Fournier
Agreement are limited in any material respect or terminated for any reason.

18.  NOTICES. Unless otherwise explicitly set forth herein, any notice required
or permitted to be given hereunder shall be in writing and shall be delivered
personally by hand, or sent by reputable overnight courier, signature required,
to the addresses of each party set forth below or to such other address or
addresses as shall be designated in writing in the same matter:

                    (a)  If to WFHC:

                         Women First HealthCare, Inc.
                         12220 El Camino Real, Suite 400
                         San Diego, CA 92130
                         Attention:  Senior Vice President,
                                     Corporate Development

                    (b)  If to Essentia:

                         Essentia Pharmaceuticals B.V.
                         16690 Swingley Ridge Road, Suite 100
                         P.O. Box 679
                         Chesterfield, MO 63006-0679
                         Attention:  President & COO

All notices shall be deemed given when received by the addressee.

19.  NON-SOLICITATION. During the Copromotion Term and for a period of twelve
(12) months thereafter, neither party shall solicit, directly or indirectly, any
individual who was a member of the other party's sales force or marketing group
related to either of the Products in the Territory during the Copromotion Term,
without the written consent of the other party.

20.  MISCELLANEOUS PROVISIONS.

               (a)  Assignment. Neither party shall assign or otherwise transfer
this Agreement or any interest herein or right hereunder without the prior
written consent of the other party, and any such purported assignment, transfer
or attempt to assign or transfer any interest herein or right hereunder shall be
void and of no effect; except that (i) each party may assign its rights and
obligations hereunder to an Affiliate without the prior consent of the other
party (although, in such event, the assigning party shall remain primarily
responsible for all of its obligations and agreements set forth herein,
notwithstanding such assignment) and (ii) WFHC may assign its rights and
obligations to a successor (whether by merger, consolidation, reorganization or
other similar event) or purchaser of all or substantially all of its business
assets relating to the Products, provided that such successor or purchaser has
agreed in writing to assume all of WFHC's rights and obligations hereunder and a
copy of such assumption is

                                       28
<PAGE>   29

provided to Essentia hereunder.

               (b)  Non-Waiver. Any failure on the part of a party to enforce at
any time or for any period of time any of the provisions of this Agreement shall
not be deemed or construed to be a waiver of such provisions or of any right of
such party thereafter to enforce each and every such provision on any succeeding
occasion or breach thereof.

               (c)  Dispute Resolution. (i) If any dispute arises under this
Agreement which cannot be resolved expeditiously by the Sales/Marketing
Committee after due consideration, the matter shall be submitted to the
President of Essentia and the President of WFHC for resolution. If such
personnel are unable to resolve such dispute within thirty (30) days of
initiating such negotiations, then, subject to Section 20(c)(iii) below such
dispute shall be finally resolved by binding arbitration under Section 20(c)(ii)
below.

                                        (ii) Any such arbitration shall be held
in San Diego, California, according to the Commercial Arbitration Rules (the
"Rules") of the American Arbitration Association. Any arbitration herewith shall
be conducted in the English language. The arbitration shall be conducted by one
arbitrator who is knowledgeable in the subject matter which is at issue in the
dispute and who is selected by mutual agreement of the parties or, failing such
agreement, shall be selected according to the AAA rules. The parties shall have
such discovery rights as the arbitrator may allow, but in no event broader than
that discovery permitted under the Federal Rules of Civil Procedure. In
conducting the arbitration, the arbitrator shall apply the California Evidence
Code, and shall be able to decree any and all relief of an equitable nature,
including but not limited to such relief as a temporary restraining order, a
preliminary injunction, a permanent injunction, or replevin of property, as well
as specific performance. The reasonable fees and expenses of the arbitrator
along with the reasonable legal fees and expenses of the prevailing Party
(including all expert witness fees and expenses), the fees and expenses of a
court reporter, and any expenses for a hearing room, shall be paid as follows:
If the arbitrator rules in favor of one Party on all disputed issues in the
arbitration, the losing Party shall pay 100% of such fees and expenses; if the
arbitrator rules in favor of one Party on some issues and the other Party on
other issues, the arbitrator shall issue with the rulings a written
determination as to how such fees and expenses shall be allocated between the
Parties. The arbitrator shall allocate fees and expenses in a way that bears a
reasonable relationship to the outcome of the arbitration, with the Party
prevailing on more issues, or on issues of greater value or gravity, recovering
a relatively larger share of its legal fees and expenses. The decision of the
arbitrator shall be final and may be entered, sued on or enforced by the Party
in whose favor it runs in any court of competent jurisdiction at the option of
such Party. Whether a claim, dispute or other matter in question would be barred
by the applicable statute of limitations, which statute of limitations also
shall apply to any claim or disputes subject to arbitration under this Section
20(c), shall be determined by binding arbitration pursuant to this Section.

                                        (iii) Notwithstanding anything to the
contrary in this Section 20(c), either Party may seek immediate injunctive or
other interim relief or other equitable remedies without resort to arbitration
from any court of competent jurisdiction as necessary to enforce and prevent
infringement of the patent rights, copyright rights, trademarks, trade secrets,
or other intellectual property rights owned or controlled by a Party or its
Affiliates or to prevent breach of any of Sections 2(c), 3(e), 3(g), 7(d), 10,
15 or 19 hereof.

                                       29
<PAGE>   30

               (d)  Entirety of Agreement. This Agreement contains the entire
understanding of the parties with respect to the subject matter hereof and
thereof and supersedes all previous and contemporaneous verbal and written
agreements, representations and warranties with respect to such subject matter.
This Agreement (or any provision or term hereof) may be released, waived,
changed or supplemented only by a written agreement signed by an officer or
other authorized representative of the party against whom enforcement of any
release, waiver, change or supplement is sought. This Agreement shall not be
strictly construed against either party hereto.

               (e)  Public Announcements. The form and content of any public
announcement to be made by one party regarding this Agreement, or the subject
matter contained herein, shall be subject to the prior written consent of the
other party (which consent may not be unreasonably withheld), except as may be
required by applicable law (including, without limitation, disclosure
requirements of the SEC, Nasdaq, or any other stock exchange) in which event the
other party shall endeavor to give the other party reasonable advance notice and
review of any such disclosure.

               (f)  Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of California,
without regard to its conflicts of law principles.

               (g)  Relationship of the Parties. In making and performing this
Agreement, the parties are acting, and intend to be treated, as independent
entities and nothing contained in this Agreement shall be construed or implied
to create an agency, partnership, joint venture, or employer and employee
relationship between WFHC and Essentia. Except as otherwise provided herein,
neither party may make any representation, warranty or commitment, whether
express or implied, on behalf of or incur any charges or expenses for or in the
name of the other party. No party shall be liable for the act of any other party
unless such act is expressly authorized in writing by both parties hereto.

               (h)  Counterparts. This Agreement shall become binding when any
one or more counterparts hereof, individually or taken together, shall bear the
signatures of each of the parties hereto. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original as against the
party whose signature appears thereon, but all of which taken together shall
constitute but one and the same instrument.

               (i)  Force Majeure. Neither party shall be liable to the other
party for any failure to perform as required by this Agreement if the failure to
perform is due to circumstances reasonably beyond such party's control,
including, without limitation, acts of God, civil disorders or commotions, acts
of aggression, fire, explosions, floods, drought, war, sabotage, embargo,
unexpected safety or efficacy results obtained with a Product, utility failures,
supplier failures, material shortages, labor disturbances, a national health
emergency, or appropriations of property. A party whose performance is affected
by a force majeure event shall take prompt action using its reasonable best
efforts to remedy the effects of the force majeure event.

               (j)  No Implied Rights. Nothing in this Agreement is intended to
create or imply any right or license in the other Party under any patent rights,
copyrights, trademarks or

                                       30
<PAGE>   31
other intellectual property rights owned or controlled by a Party, except as
expressly set forth herein.

                                       31
<PAGE>   32

               IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement in multiple counterparts through their duly authorized
representatives.

ESSENTIA PHARMACEUTICALS B.V.                  WOMEN FIRST HEALTHCARE, INC.

By: ____________________________               By: ____________________________
Name:   John C. McCall                         Name:  Susan E. Dube
Title:  President & COO                        Title: Senior Vice President,
                                                      Corporate Development

                                       32
<PAGE>   33

                                    EXHIBIT A

                               COVERED PHYSICIANS

                                       33
<PAGE>   34

                                    EXHIBIT B

                      TERMS OF USE OF ESCLIM(TM) TRADEMARK

Essentia shall sell, distribute and promote the Esclim(TM) Product under the
Esclim(TM) Trademark, to the exclusion of any other trademark (except Essentia's
own corporate name). Except as otherwise provided in this Agreement, under no
circumstances shall Essentia, as a result of this Agreement, obtain any
ownership interest or other right in the Esclim Trademark. Essentia shall
promptly notify WFHC in writing of any alleged or threatened infringement of the
Esclim(TM) Trademark in the Territory of which it becomes aware. As between WFHC
and Essentia, WFHC shall have the right to prosecute any infringement action
with respect to the Esclim(TM) Trademark.

                                       34
<PAGE>   35

                                    EXHIBIT C

                     TERMS OF USE OF ORTHO-EST(R) TRADEMARK

Essentia agrees that it shall not contest the validity of the ORTHO-EST(R)
Trademark or Ortho-McNeil Pharmaceutical's ownership of the ORTHO-EST(R)
Trademark or any registrations relating thereto. Essentia acknowledges that this
Agreement does not constitute any form of assignment or transfer of ownership in
the ORTHO-EST(R) Trademark. Essentia agrees that nothing in this Agreement shall
give Essentia any proprietary or other interest or right in the ORTHO-EST(R)
Trademark, or the right to register it or trademarks similar to the ORTHO-EST(R)
Trademark in the Territory, other than pursuant to the license granted pursuant
to Section 2(c) of the Agreement. Essentia agrees that all use of the
ORTHO-EST(R) Trademark shall inure to the benefit of Ortho-McNeil
Pharmaceutical. Essentia agrees at the reasonable request of WFHC or
Ortho-McNeil Pharmaceutical to execute any and all documents necessary or
appropriate to assist Ortho-McNeil Pharmaceutical in maintaining Ortho-McNeil
Pharmaceutical's rights in and to the ORTHO-EST(R) Trademark, all at
Ortho-McNeil Pharmaceutical's sole cost and expense.

Advertising and other promotional materials created by Essentia to promote sales
of the ORTHO-EST(R) Product, if any, and any use of the ORTHO-EST(R) Trademark
in such materials, will be submitted to WFHC to provide to Ortho-McNeil
Pharmaceutical for its prior written approval.

All advertising copy, promotional materials, press releases, labels, packaging
and other materials relating to the ORTHO-EST(R) Product and displaying the
ORTHO-EST(R) Trademark shall comply with the following guidelines:

A.   The ORTHO-EST(R) Trademark shall be used only in a manner reasonably
     intended to (i) promote the general goodwill and public acceptance of the
     ORTHO-EST(R) Product, and (ii) maintain enforceability of the ORTHO-EST(R)
     Trademark against misuse or infringement by others.

B.   The ORTHO-EST(R) Trademark is to appear prominently, in a distinctive type
     size and/or style, on all packaging and labels. The proper trademark symbol
     (i.e., (R)) should follow the ORTHO-EST(R) Trademark in its most prominent
     location on all packaging and labels. The ORTHO-EST(R) Trademark symbol
     should follow the mark once in each piece of printed matter and preferably
     where the ORTHO-EST(R) Trademark appears most prominently on the first page
     of the piece.

C.   The ORTHO-EST(R) Trademark shall always be used in a manner that will
     distinguish it from the surrounding text. The ORTHO-EST(R) Trademark may be
     distinguished in the following ways: In all capital letters: ORTHO-EST; in
     italic print with an initial capital letter: Ortho-Est Tablets; and in
     print that is larger and/or bolder than text: ORTHO-EST.

D.   The ORTHO-EST(R) Trademark shall always be used as a proper adjective. The
     ORTHO-EST(R) Trademark should, whenever possible, be followed by the
     word(s) comprising the remainder of the Official Product Name, e.g.,
     Tablets. This shall be done

                                       35
<PAGE>   36

     at least where the ORTHO-EST(R) Trademark appears most prominently and on
     the first and last pages of a printed piece.

     1.   The official product names to be used with the ORTHO-EST(R) Trademark
          shall have initial capital letters, e.g., ORTHO-EST Tablets.

     2.   If a promotional piece discusses more than one presentation of a
          product, the ORTHO-EST(R) Trademark should be followed by the words
          comprising the remainder of the official product names, e.g.,
          ORTHO-EST Tablets and Caplets.

     3.   The ORTHO-EST(R) Trademark shall not be used in conjunction with a
          non-descriptive noun, e.g., "ORTHO-EST studies" is an incorrect usage.

     4.   The word "brand" may also be used to reduce the possibility that the
          ORTHO-EST(R) Trademark will be thought of as the generic name for the
          product. When used, it should always appear in small print, e.g.,
          ORTHO-EST brand tablets.

E.   The ORTHO-EST(R) Trademark shall not be used in the possessive form.

          Correct: ___mg size ORTHO-EST Tablets

          Wrong:   ORTHO-EST's 400 mg size

F.   The ORTHO-EST(R) Trademark shall not be used in the plural form.

          Correct: The doctor recommended ORTHO-EST Tablets

          Wrong:   The doctor recommended ORTHO-ESTS

G.   The ORTHO-EST(R) Trademark shall not be hyphenated or divided to create a
     new word from the ORTHO-EST(R) Trademark.

          Correct: Patients treated with ORTHO-EST Tablets

          Wrong:   ORTHO-EST-treated patients

H.   The ORTHO-EST(R) Trademark shall not be used as a verb.

I.   The ORTHO-EST(R) Trademark shall not be equated with the active ingredient.

          Correct: ORTHO-EST Tablets (estropipate)

          Wrong:   ORTHO-EST (estropipate)

                                       36
<PAGE>   37

J.   The ORTHO-EST(R) Trademark, wherever it is used with respect to ORTHO-EST
     Rx products, shall utilize the same type style as currently used by ORTHO
     for Ortho-Est products.

                                       37<PAGE>   1

                                                                    Exhibit 10.1

CONFIDENTIAL

                 SETTLEMENT AGREEMENT AND MUTUAL GENERAL RELEASE

        THIS SETTLEMENT AGREEMENT AND MUTUAL GENERAL RELEASE (hereinafter the
"Settlement Agreement") is made and entered into this 12 day of March, 2001 by
and between CALIPER TECHNOLOGIES CORP., a Delaware corporation (hereinafter
"CALIPER") and ACLARA BIOSCIENCES, INC., a Delaware corporation (hereinafter
"ACLARA"). CALIPER and ACLARA are collectively referred to herein as the
"Parties".

                                    RECITALS

        A. WHEREAS, CALIPER has alleged various claims, counterclaims, and
causes of action against ACLARA arising out of or relating to the `022 Patent
Family (as defined in the Cross-License Agreement entered into by and between
CALIPER and ACLARA as of the same date hereof and attached hereto as Exhibit B
(hereinafter the "Cross-License Agreement")). CALIPER has also alleged various
claims and causes of action against ACLARA arising out of or relating to the
Ramsey Patent Family as defined in the Cross-License Agreement.

        B. WHEREAS, ACLARA has alleged various claims and causes of action
against CALIPER arising out of or relating to the `022 Patent Family. ACLARA has
also alleged various counterclaims and causes of action against CALIPER arising
out of or relating to the Ramsey Patent Family.

        C. WHEREAS, the various claims, counterclaims, and causes of action
described above (collectively hereinafter the "Claims") are at issue and/or are
related to certain litigation (collectively hereinafter the "Litigation")
pending in:

        1. the Superior Court of the State of California, in and for the County
of Santa Clara, entitled "CALIPER TECHNOLOGIES CORP. v. BERTRAM ROWLAND; FLEHR,
HOHBACH, TEST, ALBRITTON & HERBERT; ACLARA BIOSCIENCES, INC.; AND DOES ONE TO
ONE HUNDRED", Santa Clara County Superior Court Case No. CV780743 (hereinafter
"the State Action");

        2. the United States District Court for the Northern District of
California, entitled "ACLARA BIOSCIENCES, INC. v. CALIPER TECHNOLOGIES CORP.",
Northern District of California Civil Case No. C-99-1968 CRB (hereinafter "the
`015 Action"); and/or

        3. the United States District Court for the Northern District of
California, entitled "CALIPER TECHNOLOGIES CORP. AND UT-BATTELLE, LLP v. ACLARA
BIOSCIENCES, INC.", Northern District of California Civil Case No. C-00-0145
(hereinafter "the Ramsey Action").

        D. WHEREAS, on January 4, 2001, the Parties met in the presence of
Magistrate Judge Bernard Zimmerman of the United States District Court for the
Northern District of California and signed a document entitled "Term Sheet"
(attached hereto as Exhibit A) to record the essential terms of the agreement
that would settle the Litigation. The Term Sheet was lodged

                                        1
Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated as ***. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission.
<PAGE>   2

CONFIDENTIAL

with the Court and identified by the Parties on the record as reflecting all
essential terms of the settlement to which the Parties had agreed.

        E. WHEREAS, it is the intent of the Parties to effectuate the terms set
out in the Term Sheet, with such additional terms and clarifications as the
Parties have subsequently agreed upon, through the following agreements:

               1. this Settlement Agreement;

               2. the Cross-License Agreement (Exhibit B); and

               3. that certain Common Stock Issuance Agreement entered into by
and between CALIPER and ACLARA as of the same date hereof and attached hereto as
Exhibit C (hereinafter the "Common Stock Issuance Agreement").

        F. WHEREAS, it is the further intent of the Parties that this Settlement
Agreement, the Cross-License Agreement, and the Common Stock Issuance Agreement
(collectively hereinafter the "Integrated Agreement") form an integrated set of
agreements that are to be interpreted and applied together as a single agreement
for the purpose of effectuating the Parties' full intent and agreement on the
subjects addressed in these agreements. It is the further intent of the Parties
that the Integrated Agreement is to take the place of, and to supersede, the
Term Sheet (which shall, as of delivery of the executed Integrated Agreement, be
of no further force or effect), and that any conflict between the terms of the
Integrated Agreement and those of the Term Sheet are to be resolved solely by
reference to the terms reflected in the Integrated Agreement.

                              TERMS AND CONDITIONS

        1. INCORPORATION OF RECITALS. The Parties incorporate herein all of the
above recitals as if fully set forth in the body of this Settlement Agreement.

        2. GOOD FAITH SETTLEMENT. The Parties desire to resolve the Litigation
and the Claims, and certain other disputes, in the manner and to the extent set
forth in the Integrated Agreement. The Parties agree that the settlement
embodied in the Integrated Agreement is made in good faith.

        3. REPRESENTATIONS AND WARRANTIES.

               (a) The Parties mutually represent and warrant to each other
that:

                      (i)  they are authorized to enter into the Integrated
Agreement and to satisfy the terms and conditions established therein;

                      (ii) neither the execution nor performance of the
Integrated Agreement will breach or conflict with any agreement, undertaking,
instrument or court order to which they are subject;

                                        2
<PAGE>   3

CONFIDENTIAL

                      (iii) all actions and approvals, corporate or otherwise,
necessary for them to enter into the Integrated Agreement and to perform their
obligations hereunder have been obtained;

                      (iv)  each of them has obtained any and all waivers and/or
approvals that may be required under its existing agreements with third parties
to permit it to enter into the Integrated Agreement and to perform the
obligations and grant the rights established therein;

                      (v)   the Integrated Agreement constitutes a valid and
binding obligation of each Party, enforceable against it in accordance with its
terms and conditions;

                      (vi)  the person or persons signing the Integrated
Agreement on behalf of each of them are authorized to do so;

                      (vii) each of them has not transferred or assigned,
including by operation of law or otherwise, any of the property, rights, claims,
suits, causes of action, demands, liabilities or obligations that are the
subject of the Integrated Agreement;

                      (viii) each of them has read and understood the terms and
consequences of the Integrated Agreement and is fully aware of the legal and
binding effect of the Integrated Agreement;

                      (ix)  each of them has obtained advice of legal counsel in
connection with the negotiation and settlement of all aspects of the Litigation
prior to entering into the Integrated Agreement;

                      (x)  each of them has made such investigation of the facts
pertaining to the Integrated Agreement, and of all matters pertaining to it, as
it deems necessary; and

                      (xi) each of them has executed the Integrated Agreement
voluntarily and without any duress or undue influence on the part of the Parties
hereto or any third party.

               (b) The Parties are not relying on any representations,
warranties, or advice as to the rights, obligations, and terms of the Integrated
Agreement from each other or from the other's attorneys, other than those that
appear in the Integrated Agreement, the attached exhibits and the letter from
Latham & Watkins delivered to CALIPER pursuant to Section 3 of the Common Stock
Issuance Agreement.

               (c) The Parties voluntarily execute the Integrated Agreement on
their own behalf and, with respect to CALIPER, on behalf of the CALIPER Entities
(as defined in Section 6(a) of this Settlement Agreement), and, with respect to
ACLARA, on behalf of the ACLARA Entities (as defined in Section 6(a) of this
Settlement Agreement), with full knowledge of its significance and with the
express intention of effecting its legal consequences.

        4. CONSIDERATION TO CALIPER. In consideration for the promises and
covenants set forth in the Integrated Agreement, CALIPER shall receive the
consideration set forth in the Integrated Agreement, including without
limitation: (a) the general releases and dismissals provided for herein; (b)
payment of $27.5 million in cash and/or stock, as provided for and in

                                        3
<PAGE>   4

CONFIDENTIAL

accordance with the Common Stock Issuance Agreement, in full and final
settlement of its Claims in the Litigation; (c) $5 million in cash and/or stock,
as provided for and in accordance with the Common Stock Issuance Agreement, for
its license to ACLARA of the Ramsey Patent Family patents as provided for and in
accordance with the Cross-License Agreement; (d) *** as provided for and in
accordance with the Cross-License Agreement; and (e) *** license to ACLARA's
`022 Patent Family patents as provided for and in accordance with the
Cross-License Agreement.

        5. CONSIDERATION TO ACLARA. In consideration for the promises and
covenants set forth in the Integrated Agreement, ACLARA shall receive the
consideration set forth in the Integrated Agreement, including without
limitation: (a) the general releases and dismissals provided for herein and (b)
*** license to CALIPER's Ramsey Patent Family patents as provided for and in
accordance with the Cross-License Agreement.

        6. RELEASE OF ACLARA BY CALIPER.

               (a) Subject to Section 6(b), CALIPER, on behalf of itself and on
behalf of each of its predecessors, successors, assigns, and present and former
officers, directors, employees, agents, representatives, insurers, sureties,
CALIPER Controlled Persons (as defined in Section 20(a)(ii)(B)) and attorneys
(***) (collectively hereinafter the "CALIPER Entities"), hereby releases and
forever discharges ACLARA and each of its predecessors, successors, assigns, and
present and former officers, directors, employees, agents, representatives,
insurers, sureties, ACLARA Controlled Persons and attorneys (***) (collectively
hereinafter the "ACLARA Entities") who were, are, or may ever become liable to
CALIPER or the CALIPER Entities of and from any and all claims, demands, causes
of action, obligations, liens, taxes, damages, losses, costs, attorneys' fees,
and expenses of every kind and nature whatsoever, known or unknown, fixed or
contingent, including any and all rights to subrogation therefor, which CALIPER
or the CALIPER Entities may have had, now has, or may hereafter have against
ACLARA or the ACLARA Entities by reason of any matter, cause, or thing arising
at any time up to the Effective Date, including without limitation (i) all
claims and disputes at issue in the Litigation, (ii) any and all claims for
incidental, consequential, ensuing, and/or resulting damage arising from the
prosecution of the complaints, counterclaims, defenses, and/or settlement of the
Litigation, (iii) all claims arising from actions taken or statements made
concerning or in connection with the Litigation, and (iv) any and all matters
raised and/or which could have been raised in, or as a result of, the
Litigation; (collectively hereinafter, and as further restricted by Section 6(b)
below, the "CALIPER Released Claims").

               (b) Notwithstanding Section 6(a), CALIPER Released Claims shall
not include (collectively hereinafter the "CALIPER Excluded Claims"):

                      (i) any claims arising out of or relating to the
Integrated Agreement;

                      (ii) the right to assert in an Arbitration concerning the
`022 Patent Family, in which ACLARA has asserted infringement of a Patent in the
`022 Patent Family or

--------
*** Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                                        4
<PAGE>   5

CONFIDENTIAL

CALIPER has commenced a declaratory judgment action based upon the imminent
threat of such assertion, equitable claims, counterclaims and defenses ***;

                      (iii) claims, counterclaims and defenses ***;

                      (iv) the right to assert that unlicensed products
currently manufactured by ACLARA, or unlicensed current activities of ACLARA,
infringe a Valid Claim of a Patent in the Ramsey Patent Family, as such terms
are defined in the Cross-License Agreement; provided however, that the right to
claim damages for such alleged infringement occurring prior to the Effective
Date is hereby released and forever discharged and extinguished;

                      (v) any claims by any CALIPER Entities where such claims
are unrelated to (A) the CALIPER Entities' affiliation with CALIPER, (B) any
rights derived directly or indirectly from CALIPER (by assignment or otherwise),
or (C) any duty that they may have to CALIPER or that CALIPER may have to them;
and

                      (vi) any claims against any ACLARA Entities, where such
claims are unrelated to (A) the ACLARA Entities' affiliation with ACLARA, (B)
any rights derived directly or indirectly from ACLARA (by assignment or
otherwise), or (C) any duty that they may have to ACLARA or that ACLARA may have
to them.

        7. RELEASE OF CALIPER BY ACLARA.

               (a) Subject to Section 7(b), ACLARA, on behalf of itself and on
behalf of each of the ACLARA Entities, hereby releases and forever discharges
CALIPER and each of the CALIPER Entities who were, are, or may ever become
liable to ACLARA or the ACLARA Entities of and from any and all claims, demands,
causes of action, obligations, liens, taxes, damages, losses, costs, attorneys'
fees, and expenses of every kind and nature whatsoever, known or unknown, fixed
or contingent, including any and all rights to subrogation therefor, which
ACLARA or the ACLARA Entities may have had, now have, or may hereafter have
against CALIPER or the CALIPER Entities by reason of any matter, cause, or thing
arising at any time up to the Effective Date, including without limitation (i)
all claims and disputes at issue in the Litigation, (ii) any and all claims for
incidental, consequential, ensuing, and/or resulting damage arising from the
prosecution of the complaints, counterclaims, defenses, and/or settlement of the
Litigation, (iii) all claims arising from actions taken or statements made
concerning or in connection with the Litigation, and (iv) any and all matters
raised and/or which could have been raised in, or as a result of, the
Litigation; (collectively hereinafter, and as further restricted by Section 7(b)
below, the "ACLARA Released Claims").

               (b) Notwithstanding Section 7(a), ACLARA Released Claims shall
not include (collectively hereinafter the "ACLARA Excluded Claims"):

                      (i) any claims arising out of or relating to the
Integrated Agreement;

                      (ii) claims, counterclaims and defenses ***

--------
*** Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                                        5
<PAGE>   6

CONFIDENTIAL

                      (iii) the right to assert that unlicensed products
currently manufactured by CALIPER, or unlicensed current activities of CALIPER,
infringe a Valid Claim of a Patent in the `022 Patent Family, as such terms are
defined in the Cross-License Agreement; provided, however, that the right to
claim damages for such alleged infringement arising or occurring prior to the
Effective Date is hereby released and forever discharged and extinguished;

                      (iv) any claims by any ACLARA Entities where such claims
are unrelated to (A) the ACLARA Entities' affiliation with ACLARA, (B) any
rights derived directly or indirectly from ACLARA (by assignment or otherwise),
or (C) any duty that they may have to ACLARA or that ACLARA may have to them;
and

                      (v) any claims against any CALIPER Entities, where such
claims are unrelated to (A) the CALIPER Entities' affiliation with CALIPER, (B)
any rights derived directly or indirectly from CALIPER (by assignment or
otherwise), or (C) any duty that they may have to CALIPER or that CALIPER may
have to them.

        8. DISMISSAL OF THE STATE ACTION. Within two business days of delivery
of the executed Integrated Agreement, CALIPER and/or its attorneys shall execute
and file with the Superior Court of California, in and for Santa Clara County, a
Request for Dismissal with Prejudice, in the form of Exhibit E attached to this
Settlement Agreement, of all of its claims against ACLARA in the State Action.
Notwithstanding such dismissal, it is understood and agreed that CALIPER shall
have the right to reassert its equitable claims in the State Action in
accordance with Section 20(x) in the event that the `022 Patent Family becomes
the subject of a future arbitration proceeding under Section 20(x) of this
Settlement Agreement, with such assertion to be made as part of that proceeding.
A filed-endorsed copy of CALIPER's Request for Dismissal shall be served upon
ACLARA or its counsel immediately after filing.

        9. DISMISSAL BY THE PARTIES OF THE `015 ACTION AND THE RAMSEY ACTION.
Within two business days of delivery of the executed Integrated Agreement, the
Parties shall execute and file with the United States District Court for the
Northern District of California (hereinafter the "District Court") stipulations
addressing dismissal of the `015 Action and the Ramsey Action in the forms of
Exhibits F and G attached to this Settlement Agreement (collectively hereinafter
"Stipulations"). Such Stipulations shall dismiss with prejudice the respective
plaintiffs' (including all co-plaintiffs) claims in each case but shall dismiss
without prejudice the respective defendants' defenses and counterclaims asserted
in the `015 Action and the Ramsey Action. In the event that the District Court
declines, as a formal matter, to accept the dismissal of said defenses and
counterclaims without prejudice and instead requires some or all of those
defenses and counterclaims to be dismissed with prejudice, the respective
defendants will dismiss such defenses and counterclaims with prejudice, but it
shall nonetheless be understood and agreed between the Parties that such
defenses and counterclaims may, except as otherwise provided under the
Cross-License Agreement, be asserted in any future proceeding concerning these
or other Patents pursuant to Section 20 of this Settlement Agreement, with such
assertion to be made pursuant to the mandatory ADR Procedures established under
that Section. File-endorsed copies of the Stipulations shall be served upon both
Parties immediately after filing.

        10. WAIVER. The Parties hereby acknowledge that there is a risk that,
subsequent to the Effective Date, they may incur, suffer, or sustain injury,
loss, damage, costs, attorneys' fees,

                                        6
<PAGE>   7

CONFIDENTIAL

or expenses, that are in some way caused by and/or connected with the persons,
entities, and/or matters referred to in the Litigation or Claims, or that are
unknown or unanticipated as of the Effective Date, or that are not presently
capable of being ascertained. Further, the Parties acknowledge that there is a
risk that such damages as are presently known may become more serious than they
now expect or anticipate. Nevertheless, the Parties expressly agree the
Integrated Agreement has been negotiated and agreed upon in light of those
realizations, and it is their intention that the releases set forth in Section 6
and 7 above of this Settlement Agreement (collectively hereinafter "Releases")
be and remain in full force and effect as a full and complete release as to all
matters covered by such Releases, notwithstanding the discovery of any
additional facts or claims that existed either before or after the Effective
Date. In so doing, the Parties have had the benefit of counsel, and have been
advised of, understand, and knowingly, voluntarily, and specifically waive all
rights they may have under California Civil Code Section 1542, which provides as
follows:

               A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR
               DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF
               EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY
               AFFECTED HIS SETTLEMENT WITH THE DEBTOR.

        11. INDEMNITY.

               (a) Indemnification of ACLARA by CALIPER

                      (i) Subject to Section 11(a)(ii), CALIPER agrees to and
will hold harmless and indemnify ACLARA and the ACLARA Entities of and from any
and all liability (including all costs, expenses, and attorneys' fees incurred
therein) arising out of:

                           (A)  ***

                           (B)  ***

                      (ii) Notwithstanding Section 11(a)(i), CALIPER shall not
be obligated to indemnify ACLARA or the ACLARA Entities ***.

               (b) INDEMNIFICATION OF CALIPER BY ACLARA.

                      (i) Subject to Section 11(b)(ii), ACLARA agrees to and
will hold harmless and indemnify CALIPER and the CALIPER Entities of and from
any and all liability (including all costs, expenses, and attorneys' fees
incurred therein) arising out of:

                           (A)  ***

                           (B)  ***

--------
*** Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                                        7
<PAGE>   8

CONFIDENTIAL

                      (ii) Notwithstanding Section 11(b)(i), ACLARA shall not be
obligated to indemnify CALIPER or the CALIPER Entities for any claims,
cross-claims, or counterclaims that may be asserted against CALIPER or the
CALIPER Entities by any person or entity ***.

        12. COMPROMISE. The Integrated Agreement is the result of a compromise
between CALIPER and ACLARA in the Litigation and shall never at any time or for
any purpose be considered an admission of liability, fault, and/or
responsibility by CALIPER or ACLARA; nor shall the existence or performance of
any obligation under the Integrated Agreement constitute or be construed as an
admission of any liability, fault, or responsibility whatsoever by CALIPER or
ACLARA. It is expressly acknowledged and understood by CALIPER that ACLARA
continues to deny any and all liability, fault and/or responsibility for the
matters alleged by CALIPER in the Litigation. It is also expressly acknowledged
and understood by ACLARA that CALIPER continues to deny any and all liability,
fault, and/or responsibility for the matters alleged by ACLARA in the
Litigation. This Settlement Agreement shall not be construed as being an
acknowledgment of the absence of liability or fault on behalf of any third
person (including, without limitation, ***). This Section is without prejudice
to the mutual right of the Parties otherwise to enforce the prospective rights
and obligations established under the Integrated Agreement.

        13. ATTORNEYS' FEES. The Parties acknowledge and agree that CALIPER and
ACLARA shall each bear its own costs, expenses, consultant and expert fees, and
attorneys' fees arising out of and/or connected with the Litigation, the
negotiation, drafting, and execution of the Integrated Agreement, and all
matters arising out of or connected therewith, except that in the event any
action is brought to enforce the Integrated Agreement, the prevailing Party
shall be entitled to reasonable attorneys' fees, expenses and costs in addition
to all other relief to which that Party may be entitled, if the Arbitration
Panel finds that the non-prevailing Party's position was frivolous or taken in
bad faith.

        14. CONSTRUCTION AND INTERPRETATION.

               (a) The Settlement Agreement is the product of negotiation and
preparation by and among the Parties and their respective attorneys. The Parties
therefore expressly acknowledge and agree that the Settlement Agreement shall
not be deemed prepared or drafted by one Party or another, or its attorneys, and
will be construed fairly in accordance with its terms and without any
construction in favor of or against either Party.

               (b) The captions and section and paragraph headings used in the
Settlement Agreement are inserted for convenience only, and shall not affect the
meaning or interpretation of the Integrated Agreement.

               (c) The Recitals and Exhibits to the Integrated Agreement are
integral parts of the Integrated Agreement, and will be read and construed and
have the same force and effect as if set out in the body of the Integrated
Agreement.

--------
*** Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                                        8
<PAGE>   9

CONFIDENTIAL

        15. GOVERNING LAW. The Settlement Agreement shall in all respects be
interpreted in accordance with and governed by the laws of the State of
California, United States, without reference to or application of its conflicts
of law provisions.

        16. BINDING EFFECT. Except as expressly provided otherwise, the
Settlement Agreement shall be binding upon and inure to the benefit of the
Parties, the CALIPER Entities and the ACLARA Entities.

        17. EFFECTIVE DATE. The Integrated Agreement shall be effective as of
the date of the complete execution by the Parties and their attorneys of all of
the agreements which are a part of, and together form, the Integrated Agreement
(hereinafter the "Effective Date").

        18. ENTIRE AGREEMENT. This Settlement Agreement together with the
exhibits hereto, and to the extent provided herein, the Cross-License Agreement
and the Common Stock Issuance Agreement, constitutes the entire agreement
between the Parties concerning the subject matter hereof and supersedes all
prior or contemporaneous representations, discussions, proposals, negotiations,
conditions, agreements and communications, whether oral or written, between the
Parties relating to the subject matter of this Agreement, including without
limitation the Term Sheet, and all past courses of dealing or industry custom.
There are no representations, warranties, agreements, arrangements, or
undertakings, oral or written, between CALIPER and ACLARA relating to the
subject matter of the Integrated Agreement that are not fully expressed in such
agreements. No amendment or modification of any provision of the Settlement
Agreement shall be effective unless in writing and signed by a duly authorized
signatory of the Party against which enforcement of the amendment or
modification is sought.

        19. COVENANT NOT TO SUE. Each of the Parties hereto covenants and
agrees, on behalf of itself and on behalf of, in the case of CALIPER, each of
the CALIPER Entities, and, in the case of ACLARA, each of the ACLARA Entities,
never to commence and/or prosecute against the other any legal action and/or
other proceedings based in whole or in part upon the claims, demands, causes of
action, obligations, damages and/or liabilities released in this Settlement
Agreement.

        20. MANDATORY ALTERNATIVE DISPUTE RESOLUTION PROCEDURE.

               (a) SCOPE; DEFINED TERMS.

                      (i) GENERALLY. Each of CALIPER and ACLARA hereby
acknowledges and agrees, on behalf of itself and on behalf of, in the case of
CALIPER, each of the CALIPER Controlled Persons and, in the case of ACLARA, each
of the ACLARA Controlled Persons, that the alternative dispute resolution
procedures set forth in this Section 20 (hereinafter the "ADR Procedures") shall
apply to * * * that arise after the Effective Date, or arose prior to the
Effective Date and have not been released pursuant to the Settlement Agreement,
and which:

                           (A) arise under the patent laws ***("Patent
Disputes"); or

--------
*** Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                                        9
<PAGE>   10

CONFIDENTIAL

                           (B) arise out of, concern, or relate to the ***
which are not *** (including without limitation, disputes based upon contract,
tort or statute) ("Non-Patent Disputes").

Patent Disputes and Non-Patent Disputes are collectively referred to herein as
"Disputes." The Parties irrevocably waive their right to a jury trial with
respect to any and all Disputes. Notwithstanding the foregoing, Interferences
declared by the USPTO between a Patent *** (as such terms are defined in the
Cross-License Agreement) shall be subject to Section 21 below.

                      (ii) DEFINED TERMS.

                           (A) "Assigned Patent" shall mean a Patent of a Party
under which any rights are transferred by such Party to a Controlled Person of
such Party, including through assignment of an underlying patent application,
and/or a patent owned by a Controlled Person based on research or development of
a party.

                           (B) "Controlled Person" shall mean, with respect to a
Party, any Person Controlled (as such term is defined by the Cross-License
Agreement) by such Party.

                           (C) "Person" shall mean an individual, sole
proprietorship, partnership, limited partnership, limited liability partnership,
corporation, limited liability company, business trust, joint stock company,
trust, unincorporated association, joint venture, or other similar entity or
organization.

                           (D) "Third Party" shall mean, with respect to a
Party, any third party who agrees, pursuant to Section 20(c)(ii), (iii) or (iv),
to resolve any dispute with the other Party, its Controlled Persons and/or its
Third Parties concerning, arising out of, or relating to (I) Patents owned or
controlled by CALIPER or ACLARA or (II) any Assigned Patent in accordance with
the ADR Procedures, as a Patent Dispute.

                      (iii) STATUS OF CONTROLLED PERSONS AND THIRD PARTIES AS
PARTIES. Except as otherwise set forth in this Settlement Agreement or limited
by the Arbitration Panel (as such term is defined in Section 20(h)), for
purposes of this Section 20 only, references to a Party, and its rights and
obligations under this Section 20, shall include any CALIPER Controlled Persons,
CALIPER Third Parties, ACLARA Controlled Persons and ACLARA Third Parties who
are parties to a given Dispute.

               (b) CONSOLIDATION OF DISPUTES.

                      (i) Any Dispute involving both a Patent Dispute and a
Non-Patent Dispute which are so related as to form the same case or controversy
within the meaning of 28 U.S.C. Section 1367 and/or to constitute a compulsory
counterclaim within the meaning of Fed. R. Civ. P. 13(a) shall be treated as a
Patent Dispute for the purposes of this Section 20 and shall be joined in the
same proceeding. Such joinder shall not be required, however, if it would bar or

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delay assertion of a Non-Patent Dispute because of the limit on the number of
simultaneously pending Patent Disputes established under Section 20(b)(iv) or
20(b)(v).

                      (ii) To the extent practicable, the Parties shall
consolidate within a single arbitration proceeding all related Disputes that may
be outstanding at the time such arbitration is commenced. However, unless the
Parties otherwise mutually agree, each proceeding involving ***. Nothing in
this provision shall be construed as requiring a Party to assert its patents at
any time; nor will any Party be deemed to have waived its right to assert any of
its patents solely by reason of its failure to do so in any given proceeding.

                      (iii) If the Parties are unable to agree to consolidate
within a single arbitration proceeding all related Disputes that may be
outstanding at the time such arbitration is commenced, those Disputes will be
resolved simultaneously in separate proceedings.

                      (iv) From the Effective Date, for a period of ***, no more
than *** may be at issue in any and all Patent Disputes which are pending at the
same time. *** the right to assert ***, either directly or through their
respective Controlled Persons. The *** may only be asserted in proceedings
commenced by third parties. *** may only be asserted by *** asserting claims
arising out of a different *** than that asserted by *** in a separate pending
proceeding, if any, commenced by ***, or against a different *** than that
asserted by *** in a pending proceeding, if any, commenced by ***. *** may only
be commenced by *** asserting claims arising out of a different *** than that
asserted by *** in a pending proceeding, if any, commenced by *** or against a
different *** than that asserted by *** in a pending proceeding, if any,
commenced by ***.

                      (v) After expiration of the *** following the Effective
Date, no more than *** may be at issue in any and all Patent Disputes which are
pending at the same time. *** the right to assert up to ***, either directly or
through their respective Controlled Persons. *** may only be asserted in
proceedings commenced by third parties. *** may only be asserted by ***
asserting claims arising out of a different *** than that asserted by *** in a
separate pending proceeding, if any, commenced by ***, or against a different
*** than that asserted by *** in a pending proceeding, if any, commenced by ***.
*** may only be commenced by an *** asserting claims arising out of a different
*** than that asserted by *** in a pending proceeding, if any, commenced by ***
or against a different *** than that asserted by *** in a pending proceeding, if
any, commenced by ***.

                      (vi) For purposes of calculating the number of Patent
Disputes that may be pending simultaneously, a Patent Dispute shall be
considered "pending" during the period between (A) the service of a Demand for
Arbitration under Section 20(e) and (B) service of the final award of the
Arbitration Panel under Section 20(s), regardless of whether that final award is
appealed.

               (c) THIRD PARTIES. All Disputes shall be determined in accordance
with this Section 20 ***.

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                      (i) NECESSARY PARTIES. If the interests of a third party
are so inextricably involved in the proceeding that the third party would
constitute a "person needed for just adjudication" within the meaning of Fed. R.
Civ. P. 19 (hereinafter a "Necessary Party"), ***.

                      (ii) FUTURE LICENSEES AND SUBLICENSEES UNDER PARTY
PATENTS. ACLARA and CALIPER shall *** (A) *** (B) ***.

                      (iii) EXISTING LICENSEES AND SUBLICENSEES UNDER PARTY
PATENTS. ACLARA and CALIPER shall ***:

                           (A) *** (A) *** (B) ***

                           (B) *** (A) *** (B) ***.

                      (iv) PARTY COOPERATION IN ADR PROCEDURES WITH THIRD
PARTIES. Each Party agrees that it will resolve in accordance with the ADR
Procedures any Disputes *** in accordance with the ADR Procedures.

                      (v) OTHER THIRD PARTIES WITH AN INTEREST IN A DISPUTE. A
third party who is *** but who has an interest in a Dispute and would not be a
Necessary Party may be given notice of the Dispute and will be permitted to
participate if:

                           (A) the Parties agree; or

                           (B) after such Dispute arises, the third party agrees
to resolve such Dispute in accordance with the ADR Procedures, and agrees to
become contractually obligated to resolve any subsequent dispute between it and
the adverse Party in the existing Dispute concerning, arising out of, or
relating to (I) Patents owned or controlled by CALIPER or ACLARA and (II) any
Assigned Patents in accordance with the ADR Procedures as a Patent Dispute.

                      (vi) PROCEDURAL RIGHTS OF THIRD PARTIES. In any proceeding
involving a third party or Controlled Person under the ADR Procedures, such
third party or Controlled Person shall be afforded such procedural rights and
obligations as are consistent with the nature and scope of its interest in the
subject matter of the Dispute.

               (d) INFORMAL DISPUTE RESOLUTION. The Parties adopt the principle
that Disputes should be regarded as business problems to be resolved promptly
through business-oriented negotiations before resorting to arbitration. The
Parties shall therefore first use their best efforts to attempt in good faith to
resolve such Dispute promptly by negotiation between executives of such Parties
prior to resorting to arbitration hereunder.

                      (i) A Party shall give the other Party or Parties written
notice of any Dispute not resolved in the normal course of business ("Notice of
Dispute"), which shall include

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a brief statement of the nature of the Party's position and the relief requested
and shall identify the executive who will represent the Party in the
negotiations and suggest a date for a face-to-face meeting to discuss the
Dispute.

                      (ii) Within fifteen business days of receiving a Notice of
Dispute, the responding Party or Parties shall participate in a face-to-face
meeting, at a mutually acceptable time and place, to discuss the Dispute in a
good-faith effort to achieve a resolution.

                      (iii) If the Dispute has not been resolved in the initial
face-to-face meeting, the Parties shall hold at least one additional
face-to-face meeting within five business days in a further effort to resolve
the Dispute. If that second meeting is unsuccessful in achieving a resolution,
and if the Parties do not agree within five business days following such meeting
to schedule additional meetings in lieu of proceeding to arbitration, any Party
to such Dispute may initiate an arbitration proceeding after five business days
following such second meeting.

                      (iv) All negotiations pursuant to this subsection
concerning Informal Dispute Resolution shall be treated as compromise and
settlement negotiations for purposes of applicable rules of evidence.

               (e) INITIATION OF ARBITRATION. In the event that a Dispute is not
resolved by negotiation pursuant to the preceding subsection, the Dispute shall
be settled by binding arbitration in accordance with the terms set out below
("Arbitration"). Any Party may initiate an Arbitration proceeding by serving on
the other Party or Parties and filing with the American Arbitration Association
("AAA") a demand for arbitration ("Demand for Arbitration"). The Demand for
Arbitration shall state the claims, demands, prayer for relief and facts upon
which the same are based with the same level of specificity required by the
Federal Rules of Civil Procedure for a complaint and shall identify with
reasonable particularity any patent claims, products, activities, and/or
provisions of the Integrated Agreement that are at issue. The Demand for
Arbitration shall also identify the demanding Party's party-appointed
arbitrator.

               (f) RESPONSE. Within fifteen business days of receipt of a Demand
for Arbitration, the responding Party or Parties shall each file with the AAA
and serve a response ("Response"), which shall identify: (i) its positions on
the issues identified in the Demand for Arbitration and any defenses to the
allegations set forth in the Demand for Arbitration in the same manner and with
the same level of specificity required by the Federal Rules of Civil Procedure
for an answer; and (ii) any counterclaims or additional issues that it believes
should be addressed in the arbitration proceeding with the same level of
specificity as required of the Demand for Arbitration; and (iii) the responding
Party's party-appointed arbitrator.

               (g) AMENDMENT OF PLEADINGS. The amendment and supplementation of
the Demand for Arbitration and Response shall be permitted in the same manner
and to the same extent as set forth in Rule 15 of the Federal Rules of Civil
Procedure. In determining whether to grant leave to a party to amend, the
Arbitration Panel shall consider whether permitting such amendment would prevent
it from rendering a just and equitable decision in the proceeding within the
Time Period specified in Section 20(o).

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               (h) SELECTION OF ARBITRATORS. The Arbitration shall be held
before a neutral, independent, three-member arbitration panel ("Arbitration
Panel"), of which one member shall be selected by ACLARA, one member shall be
selected by CALIPER, and the third member shall be selected by the first two
members. In the event that ACLARA or CALIPER has ceded its right to appoint an
arbitrator to a third party (e.g., through a contract with that third party),
such third party will have the right and obligation to appoint an arbitrator in
place of ACLARA or CALIPER, as applicable. The selection of the third member,
who shall serve as chair ("Chair") of the Arbitration Panel, shall be made by
the two party-appointed arbitrators from among any candidates identified by
them, subject to the qualifications and requirements set forth herein. The Chair
shall be selected within fifteen business days following the appointment of the
last party-appointed arbitrator. The selection of each arbitrator shall be
effected by a notice that includes sufficient information concerning the
arbitrator's affiliations, experience, and qualifications to permit the Parties
to assess any potential challenges.

               (i) QUALIFICATION OF ARBITRATORS. Regardless of by whom
appointed, each of the arbitrators shall be neutral and unbiased and shall have
no material financial interest in any of the parties to the arbitration or the
Disputes to be decided. Each arbitrator shall have sufficient knowledge and
experience (as well as sufficient available time) to qualify him or her to
understand and evaluate the issues to be presented fully and intelligently
within the time allotted for the proceeding. In a Patent Dispute, the Chair
shall be an attorney *** in the field of patent law and experience and/or
training in one or more technical areas relevant to the Dispute. In a Non-Patent
Dispute, the Chair shall be an attorney *** in the field of patent law, the
licensing of intellectual property, and/or the litigation of intellectual
property disputes. Apart from a Party's initial contacts with its prospective
party-appointed arbitrators to ascertain their qualifications, availability, and
willingness to serve, there shall be no ex parte contacts between any
Party-appointed arbitrator and any Party. There shall be no ex parte contacts at
any time between any arbitrator and any Party concerning any matter bearing on
the merits of the issues to be determined in the arbitration.

               (j) EFFECT OF FAILURE TO APPOINT ARBITRATOR. In the event a Party
fails to appoint its party-appointed arbitrator within the time required herein,
or if an arbitrator is removed or becomes unable to serve and the Party
appointing that arbitrator fails to appoint a replacement within fifteen
business days of receiving notice of the removal or resignation of that
arbitrator, or if the two party-appointed arbitrators fail to appoint (or
replace) the Chair within the required period, a request shall be made for
appointment of the required arbitrator by the AAA in accordance with Rule R-13
of the AAA Commercial Arbitration Rules, as amended and effective on September
1, 2000 ("AAA Rules") Any such appointment shall be made within fifteen business
days of submission of the request to the AAA.

               (k) CHALLENGES TO ARBITRATORS. Any Party may challenge any
arbitrator for cause, based on interest, bias, lack of qualification, or
inability to serve. The Parties shall meet and confer in good faith on any such
challenge, which must be made within five business days of the arbitrator's
appointment, except that a later challenge may be made up to five business days
after the date on which the challenging Party first learns of the facts upon
which the challenge is

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based if those facts did not exist at the time of the original five-day period
and/or could not have been ascertained by the challenging Party at that earlier
time with the exercise of reasonable diligence. If the Parties are unable to
reach agreement on retention or dismissal of a challenged arbitrator within five
business days of a timely challenge, the challenge shall be submitted to the AAA
for resolution pursuant to R-19(b) of the AAA Rules. Any such resolution shall
be made within fifteen business days of submission to the AAA.

               (l) PROCEDURES. Unless the Parties otherwise agree, the AAA Rules
shall govern the Arbitration, except that in the case of any conflict between
this or any other provision of the Integrated Agreement and the AAA Rules, the
requirements of the Integrated Agreement shall govern. In the event that the AAA
Rules or the Integrated Agreement do not provide for a relevant rule or
procedure, the Arbitration shall follow such arbitration rules and procedures as
the Parties may agree upon or, in the absence of such agreement, as established
by the Arbitration Panel. Such rules and procedures shall be designed to
effectuate the Parties' intent that the dispute be resolved fairly, efficiently,
and in a cost-effective manner. The Parties shall have full rights of disclosure
and discovery provided for under the Federal Rules of Civil Procedure and the
Local Rules of the District Court for the Northern District of California. The
Arbitration Panel, however, shall have wide discretion to streamline procedures
in order to resolve Disputes in a fair manner within the agreed upon time.

               (m) LOCATION AND LANGUAGE. Unless the Parties otherwise mutually
agree, the Arbitration shall be conducted in San Francisco, California at the
offices of the AAA, and the proceedings shall be conducted in English.

               (n) SUBSTANTIVE LAW. The Arbitration Panel shall apply the same
substantive laws as would be applied to the Dispute if it were brought before
the District Court. The interpretation and enforcement of the ADR Procedures and
any order or award entered thereunder, shall be governed by the Federal
Arbitration Act.

               (o) TIME FOR DECISION. The Time Period for the arbitration of
each Patent Dispute shall depend upon the number of *** involved in that
Patent Dispute as follows: (i) ***; (ii) ***; (iii) ***; (iv) ***; and (v) ***.
The Time Period shall commence upon appointment of the Chair of the Arbitration
Panel. For this purpose, the appointment of the Chair shall be effective five
business days after the Chair is selected pursuant to Subsections 20(h) or 20(j)
above, except that if the Chair is subject to an unsuccessful challenge made
within the initial five-day period under subsection 20(k), the appointment shall
be effective immediately upon resolution of the challenge. For Non-Patent
Disputes the Time Period shall be ***. If one or more arbitrators must be
replaced after the initial five-day challenge period for each of them has
lapsed, the proceeding may be extended, if necessary, by up to, but no more
than, ***.

                      (i) The Arbitration Panel shall issue its final award
within the Time Period. In extraordinary circumstances, the Arbitration Panel,
upon a finding that it is impracticable to meet this deadline consistent with
its primary obligation justly to determine the controversy before it, shall have
discretion to extend or alter the deadline in ***, but only to the

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CONFIDENTIAL

extent necessary to preserve the enforceability of its awards. This deadline may
also be extended at any time with the agreement of all Parties to the
Arbitration.

                      (ii) The Arbitration Panel shall in its discretion
schedule (and may in its discretion amend) deadlines for, inter alia, the close
of discovery, the submission of dispositive motions, the pre-hearing conference,
and the hearing to promote the orderly and just resolution within the Time
Period of the Dispute before it.

               (p) DISPOSITIVE MOTIONS AND HEARING. Prior to the hearing, the
Parties may make motions for summary adjudication in accordance with Rule 56 of
the Federal Rules of Civil Procedure of any claims, counterclaims, defenses, or
issues as to which it believes there is no genuine issue of material fact. The
Arbitration Panel shall resolve such motions prior to the hearing. The
Arbitration Panel shall hold a hearing no later than one month before the
expiration of the Time Period to resolve those claims, counterclaims, defenses
and issues as to which the Arbitration Panel concludes that there exist genuine
issues of material fact. At that hearing, the Parties shall be permitted to
present, inter alia, live testimony of witnesses and legal arguments in support
of their respective positions. The Parties shall voluntarily produce all
documents that they intend to use at the hearing and a list of intended
witnesses, together with a statement of the subject matter upon which each will
testify, at least two weeks prior to the hearing, subject to supplementation for
purposes of rebuttal or good cause shown.

               (q) CONFIDENTIALITY. All Arbitration proceedings under this
Section 20 shall be confidential, except to the extent otherwise agreed by the
Parties or required by law, regulation, or court order. If disclosure is so
required, the Parties shall cooperate to attempt to ensure that such disclosure
is strictly limited to that necessary to comply with such law, regulation, or
order and shall otherwise take such steps as are available to maintain the
confidentiality of the Arbitration to the full extent permitted by law. However,
in the event that a Party contends that a third party would constitute a
Necessary Party for purposes of a particular Arbitration proceeding or has a
right or obligation to participate in the Arbitration proceeding pursuant to a
commitment to be bound by the ADR Procedures, that Party may, following notice
to the other Parties, give notice of the proceeding to such third party.

               (r) FEES AND EXPENSES OF THE ARBITRATION. The fees and expenses
of the arbitrators and any other joint costs of the Arbitration (including,
without limitation, incidental expenses of the arbitrators, facilities costs,
and other joint expenses, but excluding each Party's attorneys' fees, expert
fees, and other litigation expenses and costs) shall be ***: (i) in the case
of a Patent Dispute, ***; (ii) for a Non-Patent Dispute, ***. If a Controlled
Person, Third Party or other third party participates in the proceeding, the
Arbitration Panel shall establish a fair allocation of joint costs to that
Controlled Person, Third Party or other third party, taking into account the
presumptive allocation established above, as well as the nature and scope of the
Controlled Person's, Third Party's, or other third-party's interest in the
proceeding. The failure of any Party to post its share of the joint costs shall
subject that Party to monetary or other sanctions at the discretion of the
Arbitration Panel, including terminating sanctions for repeated failure to post
its share of the joint costs. Notwithstanding the divisions established in or

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pursuant to this subsection, the Arbitration Panel shall require a Party to bear
the entire cost of the Arbitration, or of a particular portion of the
Arbitration, if it finds that Party's position in that Arbitration or portion of
the Arbitration to have been frivolous or taken in bad faith.

               (s) DECISIONS OF THE ARBITRATION PANEL.

                      (i) DECISIONS BY MAJORITY VOTE. All rulings by the
Arbitration Panel, including its final award, shall be by majority vote. The
Arbitration Panel shall issue its award in writing, accompanied by findings of
fact and conclusions of law, and signed by the arbitrators. If a decision is not
unanimous, the dissenting arbitrator shall identify in writing her or his
reasons for disagreement.

                      (ii) DAMAGES AWARDS. The Arbitration Panel shall be
empowered to award such compensatory damages, attorneys fees and exemplary
damages, as are authorized or permitted by the governing law with respect to the
claim or claims upon which liability is found.

                      (iii) DECLARATORY RULINGS. The Arbitration Panel shall be
empowered to issue awards in the form of declaratory determinations, applying
the standards applicable in federal courts for declaratory judgments.

                      (iv) INJUNCTIVE RELIEF. The Arbitration Panel may grant
interim, provisional, or final awards providing injunctive relief ("Injunction
Orders"). If a Party refuses or fails to comply with an Injunction Order under
this provision, the prevailing Party may seek to have the Injunction Order
enforced by a court of competent jurisdiction under the Federal Arbitration Act
or other applicable laws. If the applicable law does not permit the Injunction
Order to be enforced directly, but instead requires further proceedings before
the court, the Parties agree that the substantive findings of the Arbitration
Panel shall be binding on the merits.

               (t) REVIEW OF AWARDS IN NON-PATENT DISPUTES. No review of any
order or award entered by the Arbitration Panel in a Non-Patent Dispute shall be
available, except on the limited grounds established for appeal of binding
arbitral awards under the Federal Arbitration Act. Any arbitration award granted
under this provision may be confirmed and enforced in any court of competent
jurisdiction pursuant to the Federal Arbitration Act.

               (u) REVIEW OF AWARDS IN PATENT DISPUTES. An Injunction Order or
final award entered in a Patent Dispute (collectively hereinafter an "Appealable
Award"), in addition to being reviewable under the Federal Arbitration Act,
shall be reviewable on the same grounds and to the same extent as if the
reviewing court were the United States Court of Appeals for the Federal Circuit
("Federal Circuit") reviewing an order or judgment of a United States District
Court, in accordance with the procedure set forth in section 20(v) below. No
review of orders and awards other than Appealable Awards shall be available to
the Parties, except on the limited grounds established for appeal of binding
arbitral awards under the Federal Arbitration Act. Any order or award in a
Patent Dispute which is not an Appealable Award may be confirmed and enforced in
any court of competent jurisdiction pursuant to the Federal Arbitration Act.

               (v) APPEAL OF INJUNCTION ORDERS AND FINAL AWARDS IN PATENT
DISPUTES. In order to secure the expanded scope of review for Appealable Awards
contemplated in section 20(u) above, the Parties have provided a preferred and a
secondary method for securing such

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review. The secondary method is to be followed in the event that a court of
competent jurisdiction determines that the Parties cannot obtain by the
preferred method the substantive review of an Appealable Award contemplated
herein.

                      (i) PREFERRED METHOD. Upon entry of an Appealable Award by
the Arbitration Panel, any Party may make application to the District Court for
enforcement or confirmation of such Appealable Award.

                           (A) A Party contesting such Appealable Award, shall,
within thirty (30) days of notice of the Appealable Award, serve notice on the
prevailing Party of its desire to appeal. Within ten (10) business days of
receipt of such notice, the prevailing Party shall file an application to the
District Court for enforcement or confirmation of such Appealable Award. Within
five (5) business days following the filing of such application, the Party
seeking to appeal shall file in the District Court and serve on the other Party
or Parties a pleading stating the grounds for contesting or appealing such
Appealable Award. Such pleading may state as such grounds any grounds available
under the Federal Arbitration Act and any grounds that would be available if the
Federal Circuit were reviewing the Appealable Award as an order or judgment of a
United States District Court, including without limitation, whether such
Appealable Award is supported by substantial evidence and/or its conclusions of
law are erroneous. The Parties shall then enter into a stipulation consenting to
the confirmation of the award by the District Court and entry of the Appealable
Award as a judgment of the District Court, without waiving any right by the
Parties to appeal such Appealable Award. If the District Court or Federal
Circuit refuse to accept the stipulation or to act in accordance with it, the
Parties agree to forego the preferred method at that time, to dismiss the action
in the District Court (provided that claims asserted under the grounds for
review established under the Federal Arbitration Act may be dismissed without
prejudice), and to proceed in accordance with the secondary method set forth in
section 20(v)(ii) below.

                           (B) The Party contesting or appealing such Appealable
Award shall have the right to appeal the District Court's judgment to the
Federal Circuit for final resolution of such Patent Dispute, including all
issues arising under the patent laws and any patent questions determined or
resolved by such Appealable Award or the District Court's judgment, including
without limitation patent construction, interpretation, validity, enforceability
and infringement. In addition to reviewing the Appealable Award under the
Federal Arbitration Act, the Federal Circuit shall review the Appealable Award
on the same grounds and to the same extent as if it were reviewing an order or
judgment of a United States District Court, including without limitation,
whether such Appealable Award is supported by substantial evidence, and/or the
conclusions of law supporting such Appealable Award are erroneous.

                           (C) No Party shall contest the jurisdiction of the
Federal Circuit to hear and decide the appeal. A Party that challenges the
jurisdiction of the Federal Circuit in such appeal shall be liable to the other
Party or Parties for all attorney's fees incurred by such other Parties in
connection with actions taken pursuant to this preferred method. No Party shall
assert that any Party waived the right to appeal any issue by failing to
litigate such issue on the merits before the District Court or by entering into
the stipulation discussed in Subsection (A) above.

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                           (D) If the Federal Circuit declines to accept an
appeal for jurisdictional reasons or otherwise dismisses the appeal without
reaching the merits, the District Court's judgment shall be vacated by
stipulation and shall have no further force or effect, and appeal may be had to
a new three-member private Appeal Panel (as such term is defined in Section
20(v)(ii)(D)) in accordance with the procedures set forth in subsection
20(v)(ii) below. Any appeal to such a private Appeal Panel shall be initiated
within thirty days of entry of the Arbitration Panel's Appealable Award, or
rejection of the case on jurisdictional grounds by the federal courts, if later.

                           (E) If the Federal Circuit decides on its own motion
to decline jurisdiction over, or otherwise refuses to reach the substantive
merits of, an appeal of an Appealable Award entered in Patent Disputes held
under these ADR Procedures, and if the grounds for that decision are of general
applicability and would apply to future appeals of Appealable Awards made under
these ADR Procedures, then any such future appeals shall be made directly
pursuant to subsection 20(v)(ii) below and need not first be presented to the
court.

                      (ii) SECONDARY METHOD

                           (A) INITIATION OF ARBITRATION. Within 30 days of the
entry of the Arbitration Panel's Appealable Award, or rejection of the case on
jurisdictional grounds by the federal courts, if later, any Party desiring to
contest the Appealable Award may initiate an arbitration proceeding to appeal
such Appealable Award (the "Arbitration Appeal") by serving on the other Party
or Parties and filing with the AAA a Demand for Arbitration. The Demand for
Arbitration shall state with reasonable particularity the issues on appeal. The
Demand for Arbitration shall also identify the demanding Party's party-appointed
arbitrator.

                           (B) RESPONSE. Within fifteen business days of receipt
of a Demand for Arbitration, the responding Party or Parties shall each file
with the AAA and serve a Response, which shall identify with reasonable
particularity: (i) its positions on the issues identified in the Demand for
Arbitration; (ii) any additional issues to be raised by way of cross-appeal; and
(iii) the responding Party's party-appointed arbitrator.

                           (C) AMENDMENT OF PLEADINGS. The amendment and
supplementation of the Demand and Response shall be permitted only with leave of
the Appeal Panel.

                           (D) SELECTION OF ARBITRATORS. The Arbitration Appeal
shall be held before a neutral, independent, three-member arbitration panel
("Appeal Panel"), of which one member shall be selected by each of ACLARA and
CALIPER, and the third member shall be selected by the first two members. In the
event that ACLARA or CALIPER has ceded its right to appoint an arbitrator to a
third party (e.g., through a contract with that third party), such third party
will have the right and obligation to appoint an arbitrator in place of ACLARA
or CALIPER, as applicable. The selection of the third member, who shall serve as
Chair of the Appeal Panel, shall be made by the two party-appointed arbitrators
from among any candidates identified by them, subject to the qualifications and
requirements set forth herein. The Chair shall be selected within fifteen
business days following the appointment of the last party-appointed arbitrator.
The selection of each arbitrator shall be effected by a notice that includes

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sufficient information concerning the arbitrator's affiliations, experience, and
qualifications to permit the Parties to assess any potential challenges.

                           (E) QUALIFICATION OF ARBITRATORS. Regardless of by
whom appointed, each of the arbitrators on the Appeal Panel shall be neutral and
unbiased and shall have no material financial interest in any of the parties to
the arbitration or the Disputes to be decided. Each arbitrator shall be ***.
The Chair of the Appeal Panel shall also have experience and/or training in one
or more technical areas relevant to the Dispute. Apart from a Party's initial
contacts with its prospective party-appointed arbitrators to ascertain their
qualifications, availability, and willingness to serve, there shall be no ex
parte contacts between any Party-appointed arbitrator and any Party. There shall
be no ex parte contacts at any time between any arbitrator and any Party
concerning any matter bearing on the merits of the issues to be determined in
the Arbitration Appeal.

                           (F) EFFECT OF FAILURE TO APPOINT ARBITRATOR. In the
event a Party fails to appoint its party-appointed arbitrator within the time
required herein, or if an arbitrator is removed or becomes unable to serve and
the Party appointing that arbitrator fails to appoint a replacement within
fifteen business days of receiving notice of the removal or resignation of that
arbitrator, or if the two party-appointed arbitrators fail to appoint (or
replace) the Chair within the required period, a request shall be made for
appointment of the required arbitrator by the AAA in accordance with Rule R-13
of the AAA Rules. Any such appointment shall be made within fifteen business
days of submission of the request to the AAA.

                           (G) CHALLENGES TO ARBITRATORS. Any Party may
challenge any arbitrator for cause, based on interest, bias, lack of
qualification, or inability to serve. The Parties shall meet and confer in good
faith on any such challenge, which must be made within five business days of the
arbitrator's appointment, except that a later challenge may be made up to five
business days after the date on which the challenging Party first learns of the
facts upon which the challenge is based if those facts did not exist at the time
of the original five-day period and/or could not have been ascertained by the
challenging party at that earlier time with the exercise of reasonable
diligence. If the Parties are unable to reach agreement on retention or
dismissal of a challenged arbitrator within five business days of a timely
challenge, the challenge shall be submitted to the AAA for resolution pursuant
to R-19(b) of the AAA Rules. Any such resolution shall be made within fifteen
business days of submission to the AAA.

                           (H) PROCEDURES. Briefing of the issues on appeal
shall be in accord with the rules of the Federal Circuit. Unless the Parties
otherwise agree, the AAA Rules shall govern the Arbitration Appeal, except that
in the case of any conflict between this or any other provision of the
Integrated Agreement and the AAA Rules, the requirements of the Integrated
Agreement shall govern. In the event that the AAA Rules or the Integrated
Agreement do not provide for a relevant rule or procedure, the Arbitration
Appeal shall follow such arbitration rules and procedures as the Parties may
agree upon or, in the absence of such agreement, as established by the Appeal
Panel. Such rules and procedures shall be designed to

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effectuate the Parties' intent that the dispute be resolved fairly, efficiently,
and in a cost-effective manner.

                           (I) LOCATION AND LANGUAGE. Unless the Parties
otherwise mutually agree, the Arbitration Appeal shall be conducted in San
Francisco, California at the offices of the AAA, and the proceedings shall be
conducted in English.

                           (J) SCOPE OF REVIEW AND SUBSTANTIVE LAW. The
standard(s) of review and the substantive law shall be the same as those
ordinarily applied by the Federal Circuit in an appeal from a United States
District Court.

                           (K) THE RECORD ON APPEAL. The record on appeal shall
consist of the record (e.g., transcripts, filings and exhibits) of the
arbitration proceedings conducted in accordance with Section 20(e)-(s) giving
rise to the Arbitration Appeal ("Record on Appeal"). The Appeal Panel shall not
permit further discovery or take further evidence, but rather shall determine
the Arbitration Appeal based upon the briefs of the Parties, the Record on
Appeal, and the oral argument of counsel for the Parties.

                           (L) CONFIDENTIALITY. All Arbitration Appeal
proceedings under this provision shall be confidential, except to the extent
otherwise agreed by the Parties or required by law, regulation or Court Order.
If disclosure is so required, the parties shall cooperate to attempt to ensure
that such disclosure is strictly limited to that necessary to comply with such
law, regulation or order and shall otherwise take such steps as are available to
maintain the confidentiality of the Arbitration Appeal to the full extent
permitted to law.

                           (M) FEES AND EXPENSES OF THE ARBITRATION. The joint
costs of the Arbitration Appeal shall be ***. Upon announcement of the final
award of the Appeal Panel, the *** (which shall be identified in the Appeal
Panel's final award) *** of the joint costs other than the fees of the
arbitrators and *** of the fees of the arbitrators *** for any expenditures in
excess of that allocation previously made by such ***. However, the Appeal Panel
shall require a Party to bear all or a greater proportion of the joint costs on
appeal for all or a particular portion of the Arbitration Appeal, if it finds
that Party's position in the Arbitration Appeal or portion of the Arbitration
Appeal to have been frivolous or taken in bad faith. The failure of any Party to
post its share of the joint costs shall subject that Party to monetary or other
sanctions at the discretion of the Appeal Panel, including terminating sanctions
for repeated failure to ***.

                           (N) DECISIONS OF THE APPEAL PANEL. All rulings by the
Appeal Panel, including its final award, shall be by majority vote. The
arbitrators shall issue their final award in writing, identifying the reasons
for the decision, and signed by the arbitrators. If a decision is ***.

                      (iii) The decision from the Federal Circuit (if on the
merits) or Appeal Panel shall be final. No further appeals shall be available.
The losing Party on appeal shall not contest or oppose any application by the
prevailing Party to confirm and enforce the final award entered by the Appeal
Panel in any court of competent jurisdiction.

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                      (iv) Following the period for appeal established above, or
following the conclusion of any appeal (if and to the extent that the award is
affirmed), any Appealable Award entered pursuant to these ADR Procedures may be
confirmed and enforced in any court of competent jurisdiction in accordance with
the Federal Arbitration Act.

               (w) BINDING EFFECT OF ARBITRATION DECISIONS. Any final
determination in an arbitration conducted pursuant to this provision (including
any appeals, if permitted) shall be binding and shall have full res judicata and
collateral estoppel effect as between the Parties to the Arbitration Appeal
(including any third parties who are contractually bound to participate in the
proceeding, as well as any third parties who in fact participate). However, it
is not the Parties' intent that any such arbitration decision is to create any
rights in, or to have preclusive effect on claims brought by or against, any
third parties who have not agreed to be bound by or otherwise joined in these
ADR Procedures, except insofar as the rights and obligations of a third party
derive directly from rights and obligations of the Parties (and any
participating third parties) that are actually adjudicated by the arbitration
decision.

               (x) SPECIAL RULE FOR PROCEEDINGS CONCERNING ***. In the event,
and only in the event, of an Arbitration concerning the ***, in which ***. In
considering ***, the Arbitration Panel shall, if asked, receive as evidence and
consider, but shall not be bound by, ***. In any such Arbitration, the
Arbitration, including discovery, shall be bifurcated. The Arbitration Panel
shall first consider on ***. Either Party may elect to appeal the decision ***
in accordance with the procedure set forth in section 20(v)(ii) above. Only
after the final resolution of this first phase of the proceeding and resolution
of any appeal will the arbitrators consider and issue a decision, if necessary,
on the remaining matters. Each phase of such bifurcated proceeding shall count
as a separate Arbitration for purposes of calculating the time limit for
issuance of the final award.

               (y) PROVISIONAL REMEDIES. The Arbitration Panel or the Appeal
Panel (or the Federal Circuit, in the context of any appeal from an Arbitration
Panel award made to that court) shall have exclusive authority to order
provisional or interim relief. Such provisional or interim relief may be
immediately and specifically enforced by a court otherwise having jurisdiction;
provided, however, that the effect of any Injunction Order shall be
automatically stayed pending the disposition of any appeal of such Injunction
Order, without prejudice to the right of the prevailing party to seek damages
for any infringement or other injury occurring during the course of such stay if
the Injunction Order is upheld.

               (z) PERSONAL JURISDICTION AND VENUE. The Parties waive any
objection to venue and consent to the personal jurisdiction of the federal
courts of the Northern District of California or, if those courts lack subject
matter jurisdiction, to the Superior Court for the State of California in the
county of Santa Clara, California, in any action to enforce the ADR Procedures
or any order or award entered thereunder, or the provisional or interim remedies
provided for herein.

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               (aa) TERMINATION. This Section 20 shall terminate in accordance
with Section 32 of the Settlement Agreement.

        21. SPECIAL ADR PROCEDURES FOR INTERFERENCES INITIATED BY THE UNITED
STATES PATENT & TRADEMARK OFFICE ("USPTO"). In the event that the USPTO declares
an Interference between a Patent ***, the Parties will promptly (and in no
event later than ten business days following receipt of notice of the
Interference from the USPTO) begin an arbitration proceeding ("Interference
Arbitration"). Without precluding the right of the Senior Party, as defined in
the USPTO regulations, to initiate the Interference Arbitration sooner, the
Junior Party, as defined in the USPTO regulations, in the Interference as
declared shall have the obligation to initiate the Arbitration by filing and
serving the Demand for Arbitration on the other Party and with the AAA within
the time limit.

               (a) THIRD PARTIES. If, in addition to the ***, the Interference
involves a Patent of a third party, then the Parties will request such third
party to join in the Interference Arbitration; provided, however, that if such
third party declines to join in such proceeding, the Parties will nonetheless
proceed with the Interference Arbitration to determine their rights vis-a-vis
one another. Unless the Parties otherwise agree, any such third party that
agrees to participate in an Interference Arbitration shall not be entitled to
appoint an arbitrator but shall otherwise be afforded all other rights and
obligations of a Party under this Section.

               (b) INFORMAL DISPUTE RESOLUTION PROCEDURE. The Informal Dispute
Resolution Procedure set out in subsection 20(d) shall not be required before an
Interference Arbitration is begun. The Parties shall, however, consider in good
faith whether the dispute can be resolved informally, and either Party may
request the scheduling of a meeting to address such a potential informal
resolution. Such a meeting shall take place within fifteen business days of the
request, or at such other time as the Parties may agree upon; however, the
Interference Arbitration shall not be deferred while such discussions take
place.

               (c) PERIOD FOR APPOINTMENT OF ARBITRATORS. The Interference
Arbitration shall be resolved by the majority decision of three independent
neutral arbitrators (the "Interference Panel"). Each Party shall appoint one
arbitrator within ten business days of initiation of the Interference
Arbitration. The party-appointed arbitrators shall then have ten business days
to agree upon the appointment of the third arbitrator who shall be the Chair of
the Interference Panel. If they are unable to agree on the third arbitrator,
then the third arbitrator shall be appointed by the AAA in accordance with Rule
R-13 (Appointment from Panel).

               (d) QUALIFICATION OF ARBITRATORS IN INTERFERENCE ARBITRATION.
Regardless of by whom appointed, each of the arbitrators on the Interference
Panel shall be neutral and unbiased and shall have no material financial
interest in any of the parties to the arbitration or the Disputes to be decided.
Each arbitrator shall have sufficient knowledge and experience (as well as
sufficient available time) to qualify him or her to understand and evaluate the
issues to be presented fully and intelligently within the time allotted for the
proceeding. In addition, the Chair of the Interference Panel shall ***. Apart
from initial contacts with prospective Party-

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CONFIDENTIAL

appointed arbitrators to ascertain their qualifications, availability, and
willingness to serve, there shall be no ex parte contacts between any
Party-appointed arbitrator and any Party. There shall be no ex parte contacts at
any time between any arbitrator and any Party concerning any matter bearing on
the merits of the issues to be determined in the arbitration.

               (e) EFFECT OF FAILURE TO APPOINT ARBITRATOR. In the event a Party
fails to appoint its party-appointed arbitrator within the time required herein,
or if an arbitrator is removed or becomes unable to serve and the Party
appointing that arbitrator fails to appoint a replacement within fifteen
business days of receiving notice of the removal or resignation of that
arbitrator, or if the two party-appointed arbitrators fail to appoint (or
replace) the Chair within the required period, the missing arbitrator shall be
appointed by the AAA in accordance with Rule R-13 (Appointment from Panel) of
the AAA Rules. Any such appointment shall be made within fifteen business days
of submission of the request to the AAA.

               (f) CHALLENGES TO ARBITRATORS. Either Party may challenge any
arbitrator for cause, based on interest, bias, or inability to serve. The
Parties shall meet and confer in good faith on any such challenge, which must be
made within five business days of the arbitrator's appointment, except that a
later challenge may be made up to five business day after the date on which the
challenging Party first learns of the facts upon which the challenge is based if
those facts did not exist at the time of the original five-day period and/or
could not have been ascertained by the challenging Party at that earlier time
with the exercise of reasonable diligence. If the Parties are unable to reach
agreement on retention or dismissal of a challenged arbitrator within five
business days of a timely challenge, the issue will be submitted to the AAA for
resolution in accordance with the Rules.

               (g) NARROWING OF ISSUES AND DISCOVERY. Within three weeks
following the final date by which party-appointed arbitrators must be named, the
Parties shall exchange any documents that they contend support their position(s)
as to Priority (as such term is defined in the Cross-License Agreement). Upon
request of the other Party (which must be made within ten business days of such
exchange), each Party shall also produce any specifically identified related
documents (e.g., additional pages from the same laboratory notebooks) that may
reasonably be needed to establish a complete record concerning the documents
that have been provided. Thereafter, to the extent possible the Parties shall
agree to a stipulated set of facts and narrow the issues for resolution. If the
Parties cannot so agree and with respect to the remaining issues, the Parties
shall voluntarily produce all documents that they intend to use at the hearing
and a list of intended witnesses, together with a statement of the subject
matter upon which each will testify, at least two weeks prior to the hearing,
subject to supplementation for purposes of rebuttal or good cause shown. No
other discovery shall be permitted unless ordered by the Interference Panel upon
a showing of exceptional circumstances.

               (h) ISSUES FOR DETERMINATION. The only issues before the
Interference Panel shall be:

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<PAGE>   25

CONFIDENTIAL

                      (i)   ***;

                      (ii)  ***

                      (iii) ***.

The Interference Panel shall render a decision on all three issues regardless of
the outcome of its determination on any of them. However, the Interference Panel
shall only disclose to the Parties such portions of its decision as are
necessary to implement Sections 21(j) and 21(m).

               (i) ***

               (j) PROCEDURE. The rule of decision for the Interference Panel
shall be as follows:

                      (i) If the Interference Panel finds that there is no ***,
it shall initially notify the Parties of its decision on that issue only and
shall preserve in confidence its determination on the other two issues. The
Parties shall jointly seek dissolution of the Interference on that basis. If the
USPTO declines to dissolve the Interference or if the Interference Panel
determines that there is an interference-in-fact, the Interference Panel shall
promptly inform the Parties of its determination on support and Priority, and
the Parties shall then have the respective rights and obligations set out below.

                      (ii) If the Interference Panel determines that neither
Party has support for its claims, both Parties shall promptly withdraw their
respective claims.

                      (iii) If the Interference Panel determines that only one
Party can support its claims, then that Party shall prevail in the Interference
Arbitration and be entitled to those claims.

                      (iv) If the Interference Panel determines that both
Parties can support their claims, then the Party identified by the Interference
Panel as having Priority shall be the prevailing Party and entitled to those
claims.

               (k) TIME LIMIT. The proceeding shall be completed, and a decision
issued, as promptly as possible but in any event within *** from the date on
which the Chair of the Interference Panel is appointed, or if a shorter time
limit is set by the USPTO for completion of the Interference Arbitration, within
the limit set by the USPTO.

               (l) FORM OF DECISION. The Interference Panel shall make its
decision by majority vote. The Interference Panel shall not issue written
findings of fact and conclusions of law, but shall instead merely identify the
claims or sets of claims at issue, and which Party, if any, is entitled to those
claims. If the Interference declared by the USPTO involves multiple sets of
potentially interfering claims, the Interference Panel shall render separate
determinations as to each set of claims.

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CONFIDENTIAL

               (m) RIGHTS AND OBLIGATIONS OF THE PARTIES FOLLOWING THE PANEL'S
DETERMINATION.

                      (i) The decision of the Interference Panel shall be final
and non-appealable and may be confirmed and enforced in any court of competent
jurisdiction if the non-prevailing Party does not voluntarily comply with the
decision by taking the actions set out in this subsection. The non-prevailing
Party shall not take any steps to challenge or contest the decision in any
forum, including without limitation the USPTO.

                      (ii) Upon receipt of notice of the decision of the
Interference Panel, the non-prevailing Party shall promptly withdraw or amend
accordingly the non-prevailing claims that were included in the Interference
and, if necessary, shall take such actions as are necessary (e.g., filing a
concession of priority or request for adverse judgment), to permit the
prevailing Party to continue to prosecute those of its claims that were included
in the Interference upon which it prevailed.

               (n) ABSENCE OF FUTURE PRECLUSIVE EFFECT. In any subsequent action
or dispute between the Parties outside of the context of an Interference between
a Patent ***, the award entered by the Interference Panel shall have no issue
or fact preclusive effect, and shall be inadmissible to establish any fact. The
intent of the Parties in agreeing to this arbitration procedure is simply to
streamline the Interference procedure. The Parties preserve any and all rights
and defenses outside of such Interference procedure in any forum whatsoever,
whether in alternative dispute resolution procedures or in proceedings before
any court or other governmental agency.

               (o) CONFIDENTIALITY. Any arbitration under this Section 21 shall
be strictly confidential and shall not be disclosed, except as may be required
by law, regulation or court order. If disclosure is so required, the Parties
shall cooperate to attempt to ensure that such disclosure is strictly limited to
that necessary to comply with such law, regulation or order and shall otherwise
take such steps as are available to maintain the confidentiality of the
Interference Arbitration to the full extent permitted to law. If the
non-prevailing Party fails to withdraw or adequately amend its claims as
provided in Section 21(m)(ii) above, the prevailing Party may seek injunctive
relief to require such compliance; however, the Parties shall seek to have any
such judicial proceedings maintained as confidential and the record sealed.

               (p) COSTS AND FEES. The ***. If a third party participates in the
Interference Arbitration, the Interference Panel shall establish a fair
allocation of joint costs to that third party, taking into account the
presumptive allocation established above, as well as the nature and scope of the
third-party's interest in the proceeding.

               (q) THIRD PARTIES. Neither CALIPER, nor ACLARA, will assist or
enable any third party to take any action that CALIPER or ACLARA, as applicable,
would be prohibited from taking under this Section 21 or Sections 5.1 or 5.2 of
the Cross License Agreement, including by transferring rights in a Patent
(including a patent application therein)

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involved in an Interference between a Patent *** to a third party without the
attendant agreement to abide by this Section 21 and Sections 5.1, 5.2 and 5.3 of
the Cross License Agreement; ***.

               (r) TERMINATION. This Section 21 shall terminate in accordance
with Section 32 of the Settlement Agreement.

        22. ASSIGNMENT. The Parties agree that their rights and obligations
under this Settlement Agreement, and its accompanying rights and obligations,
may not be sold, transferred, assigned, delegated, pledged, otherwise disposed
of, in whole or part, whether voluntarily, by operation of law or otherwise, by
any Party without the prior written consent of the other Party, except that
either Party may assign this Settlement Agreement, without the prior written
consent of the other Party, in connection with a Change in Control (as defined
in the Cross-License Agreement) of the assigning Party, or of such Party's
microfluidic systems line of business. Subject to the preceding sentence, the
rights and liabilities of the Parties hereto will bind, and inure to the benefit
of, their respective and permitted assignees and successors and is binding on
the Parties and their successors and permitted assigns. Any attempted assignment
other than in accordance with this Section 22 shall be null and void. This
Settlement Agreement shall be binding upon all successors in interest to all or
substantially all of either Parties' microfluidic systems line of business.

        23. NOTICES. Any notice, request, demand, or other communication
required or permitted hereunder shall be in writing, shall reference this
Settlement Agreement and shall be deemed to be properly given: (a) when
delivered personally; (b) when sent by facsimile, with written confirmation of
receipt; (c) five business days after having been sent by registered or
certified mail, return receipt requested, postage prepaid; or (d) two business
days after deposit with a private industry express courier, with written
confirmation of receipt. All notices shall be sent to the address set forth
below (or to such other address as may be designated by a Party by giving
written notice to the other Party pursuant to this Section 23:

<TABLE>
<CAPTION>
                 IF TO ACLARA:                                    IF TO CALIPER:
------------------------------------------------- ---------------------------------------
<S>                                               <C>
Aclara BioSciences, Inc.                          Caliper Technologies Corp.
1288 Pear Ave                                     605 Fairchild Drive
Mountain View, CA 94043                           Mountain View, CA 94043-2234
Attn: General Counsel                             Attn: Sr.  Director of Legal Affairs

with a copy to:                                   with a copy to:

David Doyle, Esq.                                 Sonya Winner, Esq.
Morrison & Foerster LLP                           Covington & Burling
3811 Valley Centre Drive, Suite 500               601 California Street, 19th Floor
San Diego, CA 92130                               San Francisco, CA 94108
------------------------------------------------- ---------------------------------------
</TABLE>

        24. WAIVER OF BREACH OR DEFAULT. The waiver by either Party of a breach
of or a default under any provision of the Settlement Agreement, shall not be
effective unless in writing and shall not be construed as a waiver of any
subsequent breach of or default under the same or

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                                       27
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CONFIDENTIAL

any other provision of the Settlement Agreement, nor shall any delay or omission
on the part of either Party to exercise or avail itself of any right or remedy
that it has or may have hereunder operate as a waiver of any right or remedy.

        25. SEVERABILITY. If the application of any provision of the Settlement
Agreement or any promise hereunder to any particular facts or circumstances
shall be held to be invalid, unenforceable, prohibited or illegal by an
arbitration panel, a court or any other governmental or supranational authority
(including, without limitation, the European Commission) of competent
jurisdiction, then the validity and enforceability of such provision or promise
as applied to any other particular facts or circumstances and the validity of
other provisions of the Settlement Agreement or promises hereunder shall not in
any way be affected or impaired thereby.

        26. COUNTERPARTS. This Settlement Agreement may be executed in one or
more counterparts, with the same effect as if the Parties had signed the same
document. Each counterpart so executed shall be deemed to be an original, and
all such counterparts shall be construed together and shall constitute one
Settlement Agreement.

        27. PUBLICITY. The Parties shall ***. The Parties shall not make
public statements regarding *** shall be confidential, but may be disclosed
without consent (a) for ordinary business purposes under a further binder of
confidentiality, or (b) as required by law or court order.

        28. THIRD PARTIES. Nothing in this Settlement Agreement shall be deemed
to constitute a waiver or release by either Party of any rights or actions that
it may have with respect to third parties *** other than those specifically
provided herein. Nothing in this Settlement Agreement is intended to provide
benefits or rights to third parties, other than those specifically provided
therein, ***.

        29. FORCE MAJEURE. Neither Party shall be deemed to be in default of, or
to have breached, any provision of this Settlement Agreement as the result of
delay or failure in performance resulting directly or indirectly from
circumstances beyond the Party's reasonable control, including without
limitation, acts of God, acts of civil or military authority, civil disturbance,
war, strikes or other labor disputes, fires, transportation contingencies, laws,
regulations, acts or orders or any government agency or official thereof, or
other catastrophes. The non-performing Party shall notify the other Party of
such force majeure within three days after such occurrence by giving notice to
the other party stating the nature of the event, its anticipated duration, and
any action being taken to avoid or minimize its effect. The suspension of
performance shall be of no greater scope and no longer duration than is
necessary and the non-performing Party shall use commercially reasonable efforts
to remedy its inability to perform.

        30. FURTHER ASSURANCES. Each Party agrees to take or cause to be taken
such further actions, and to execute, deliver and file or cause to be executed,
delivered and filed such further documents and instruments, and to obtain such
consents, as may be reasonably required or

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                                       28
<PAGE>   29

CONFIDENTIAL

requested in order to effectuate fully the purposes, terms and conditions of
this Settlement Agreement.

        31. RELATIONSHIP OF THE PARTIES. Nothing contained in this Settlement
Agreement shall be deemed or construed as creating a joint venture, partnership,
agency, employment or fiduciary relationship between the Parties. Neither Party
nor its agents have any authority of any kind to bind the other Party in any
respect whatsoever, and the relationship of the Parties is, and at all times
shall continue to be, that of independent contractors.

        32. SURVIVAL; EFFECT OF BREACH OF OTHER AGREEMENTS.

               (a) Subject to Section 32(b), this Settlement Agreement shall
survive termination of the Cross-License Agreement and the Common Stock Issuance
Agreement.

               (b) Sections 20 and 21 of this Settlement Agreement shall
terminate upon the date of expiration, abandonment or final determination of
invalidity or unenforceability of the last remaining Valid Claim within the `022
Patent Family and the Ramsey Patent Family, as such terms are defined in the
Cross License Agreement.

               (c) No breach of the Cross-License Agreement or the Common Stock
Issuance Agreement shall, by itself, constitute a breach of this Settlement
Agreement, unless such breach is itself a breach of this Settlement Agreement.

               (d) The Releases contained herein shall survive termination of
this Settlement Agreement.

Dated:    March 12, 2001                    By:     /s/ James L. Knighton
      ------------------------------           --------------------------

Dated:     March 12, 2001                   By:     /s/ Joseph M. Limber
      -------------------------------          -------------------------

Dated:                                      By:
      ------------------------------           -------------------------

Dated:                                      By:
      ------------------------------           -------------------------

                                       29
<PAGE>   30

CONFIDENTIAL

                                    Exhibit A

                                   Term Sheet

                                       ***

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                                       30
<PAGE>   31

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                                    Exhibit B

                             Cross-License Agreement

                       See Exhibit 10.2 to this Form 10-Q.

                                       31
<PAGE>   32

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                                    Exhibit C

                         Common Stock Issuance Agreement

                       See Exhibit 10.3 to this Form 10-Q.

                                       32

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