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Exhibit 10.28    
    

 
 

DISTRIBUTION AGREEMENT    
    

        DISTRIBUTION AGREEMENT, dated as of May 2, 2005, by and between Amphastar Pharmaceuticals, Inc., a Delaware corporation ("Seller") and Andrx
Pharmaceuticals, Inc., a Florida corporation ("Purchaser"). 

        WHEREAS,
Seller desires to appoint Purchaser as Seller's exclusive distributor of the Product to Purchaser Customers in the Territory and Purchaser desires to accept such appointment,
all pursuant to the terms of this Agreement. 

        NOW,
THEREFORE, in consideration of the mutual promises, covenants and agreements hereinafter set forth, the parties hereto agree as follows: 

ARTICLE 1

DEFINITIONS  

        As used throughout this Agreement and any exhibits, schedules and attachments hereto, each of the following terms shall have the respective meaning set forth
below: 

        1.1    "Act" means the Federal Food, Drug, and Cosmetic Act, as amended. 

        1.2    "Adverse Event" means any adverse event associated with the use of the Product in humans, whether or not considered
drug-related, including an adverse event occurring in the course of the use of the Product in professional practice, in studies, in investigations or in tests or an adverse event occurring
from Product overdose (whether accidental or intentional), from Product abuse, or from Product withdrawal, as well as any toxicity, sensitivity, failure of expected
pharmacological action, or laboratory abnormality that is, or is thought by the reporter thereof to be, serious or associated with relevant clinical signs or symptoms. 

        1.3    "Adverse Resolution" means any resolution of the Lawsuit, whether by settlement, summary judgment or trial court decision
in the U.S. District Court, or as a result of any appeal, subsequent review or reconsideration of such summary judgment or trial court decision, that prevents, enjoins, materially restricts or imposes
royalties on sales of or otherwise makes commercially unreasonable the manufacture, use, sale or offer to sell of the Product to Purchaser Customers in the Territory. 

        1.4    "Affiliate" of a party means any Person directly or indirectly controlled by, controlling or under common control with
such party. "Control" means the legal power to direct or cause the direction of the general management or policies of a Person through more than fifty percent (50%) of the ownership of voting
securities, by contract or by other means. 

        1.5    "ANDA" means an Abbreviated New Drug Application filed with the FDA and any amendments or supplements thereto. 

        1.6    "Anda" shall have the meaning given in Section 2.2. 

        1.7    "Applicable Laws" means all applicable laws, rules, and regulations that apply to the development, manufacture, supply,
marketing, sale or distribution of the Product in the Territory, or the performance of either party's obligations under this Agreement, including the Act, cGMP and other current regulations
promulgated by the FDA or any other governmental agency. 

        1.8    "At-Risk Launch" shall have the meaning given in Section 2.3. 

        1.9    "At-Risk Launch Notice" shall have the meaning given in Section 2.3. 

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. 

 

        1.10    "Authorized Generic Product" means a therapeutically equivalent, bioequivalent and legally substitutable generic version
of the brand-name product Lovenox® (including the brand name product sold as a generic) that is sold and distributed in the Territory by any one or more of Aventis Pharma S.A.,
Aventis Pharmaceuticals, Inc., their respective Affiliates, successors or assigns and/or licensees of any of the foregoing. 

        1.11    "Bankruptcy Code" shall have the meaning given in Section 8.2. 

        1.12    "cGMP" means the current Good Manufacturing Practices regulations of the FDA (as in effect from time to time) in 21
C.F.R. pts. 210 and 211. 

        1.13    "Commercially Reasonable Efforts" means, with respect to each party, efforts and resources normally used by such party
to, in the case of Seller, develop, manufacture, package and supply or, in the case of Purchaser, market, sell and distribute, a generic pharmaceutical product owned by it or to which it has rights,
which is of similar overall market potential at a similar stage in its product lifecycle, taking into account, inter alia, the competitiveness of the marketplace, the proprietary position of the
product, the profitability of the product and other relevant factors. The parties acknowledge that the level of effort and resources may change at different times during the product life cycle of the
Product. 

        1.14    "Compensatory Payments" shall have the meaning given in Section 2.3. 

        1.15    "Competitive Product" means, other than the Product or an Authorized Generic Product, a therapeutically equivalent,
bioequivalent and legally substitutable generic version of the brand-name product Lovenox®, which generic version is in the same dosage and delivery form, has the same active
ingredient and the same strength and is for the same indication as the Product, that is sold and distributed in commercial quantities in the Territory by any Person, other than Purchaser or its
Affiliates, licensees or assigns. 

        1.16    "Confidential Information" shall have the meaning given in Article 14. 

        1.17    "Damages" shall have the meaning given in Section 17.1. 

        1.18    "Effective Date" means the date of this Agreement. 

        1.19    "Favorable Resolution" means a resolution of the Lawsuit, whether by settlement, summary judgment, trial court decision
in the U.S. District Court, or otherwise, that does not prevent, enjoin, materially restrict or impose royalties on sales of or otherwise make commercially unreasonable the manufacture, use, sale or
offer to sell of the Product to Purchaser Customers in the Territory, in each case irrespective of any rights of appeal, subsequent review or reconsideration of the resolution or of the outcome of
such appeal, review or reconsideration. 

        1.20    "FDA" means the U.S. Food and Drug Administration, and any successor or replacement agency thereto. 

        1.21    "Final Favorable Resolution" means a Favorable Resolution that is not subject to any rights of appeal, subsequent review
or reconsideration by the applicable governmental authority having competent jurisdiction over the Lawsuit. 

        1.22    "First Commercial Sale" means, as the context requires, the first date on which Purchaser sells (i.e., the date of
shipment) the Product in commercial quantities to a third party, or the first date on which Seller sells (i.e., the date of shipment) the Product in commercial quantities to a third party pursuant to
a Seller Launch. 

        1.23    "Forecast" shall have the meaning given in Section 5.2. 

        1.24    "Force Majeure Event" shall have the meaning given in Article 12. 

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        1.25    "GAAP" means U.S. generally accepted accounting principles. 

        1.26    "Gross Profit" means Net Sales of Purchaser from sales of Product during a calendar quarter less the aggregate Transfer
Price paid for such Product. In the event for any calendar quarter the above calculation results in a negative number, "Gross Profit" shall be deemed zero for such calendar quarter. 

        1.27    "Gross Profit Split" shall have the meaning given in Section 4.2. 

        1.28    "Initial Purchase Order" shall have the meaning given in Section 5.1. 

        1.29    "Label", "Labeled" or "Labeling" means all labels and other written, printed or graphic matter upon (i) any
packaging, container or wrapper used with the Product, or (ii) any written material accompanying the Product, including package inserts; or, as the context requires, the act of applying and/or
using the same. 

        1.30    "Labor Costs" shall have the meaning given in Section 4.1 

        1.31    "Lawsuit" means (i) the lawsuit captioned Aventis Pharma S.A. and Aventis Pharmaceuticals, Inc. v.
Amphastar Pharmaceuticals, Inc. and Teva Pharmaceuticals USA, Inc. under Case No. 03-CV-887 RT (SGLx) in the U.S. District Court in the Central District of
California Eastern Division and (ii) any related or subsequent U.S. trial court action pertaining to the same subject matter as the lawsuit described in clause (i) above, brought by
Aventis Pharma S.A. and Aventis Pharmaceuticals, Inc. against Seller prior to Seller delivering a Launch Notice, seeking to obtain a Adverse Resolution. 

        1.32    "Launch Notice" shall have the meaning given in Section 2.3. 

        1.33    "Launch Quantities" shall have the meaning given in Section 5.1. 

        1.34    "Maximum Compensatory Payments" shall have the meaning given in Section 2.3. 

        1.35    "Maximum Annual Product Units" shall have the meaning given in Section 5.6. 

        1.36    "Minimum Annual Product Units" shall have the meaning given in Section 8.4. 

        1.37    "Net Sales" means, with respect to the Product, the gross revenues derived from the sale of the Product by Purchaser or,
with respect to the determination of the Compensatory Payments, by Seller, and their respective Affiliates, licensees and assignees to independent third parties, minus normal and customary
[***] and (vii) other normal and customary deductions utilized to calculate net sales, in each case to the extent applicable to the sale of such Product. Marketing
allowances shall (i) in the case of sales by Purchaser, be the actual marketing expenses but not [***] The elements of Net Sales as described above shall be determined
in accordance with GAAP, applied on a basis consistent with the annual audited financial statements of Purchaser's parent corporation or Seller, as the context requires. 

        1.38    "Non-At-Risk Launch" shall have the meaning given in Section 2.3. 

        1.39    "Overdue Interest Amount" means the prime rate of interest quoted as such in The Wall Street Journal on the first
business day of each month during which an amount is overdue under this Agreement, plus 5%, calculated on an annual basis, not to exceed the maximum rate permitted by Applicable Law. 

        1.40    "Packaging" means all primary and/or bulk (as applicable) containers, Labels, shipping cases or any other like matter
used in packaging or accompanying the Product; or as the context requires, the act of applying and/or using the same. 

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

3

 

        1.41    "Person" means an individual, corporation, partnership, limited liability company or other entity. 

        1.42    "Product" means Seller's generic version of the enoxaparin sodium injectable product, in 30 mg, 40 mg, 60 mg, 80 mg, 100
mg, 120 mg, and/or 150 mg strengths, to the extent approved under ANDA 76-684, that is therapeutically equivalent and bioequivalent to, and legally substitutable for, the
brand-name product Lovenox®. 

        1.43    "Product Liability Claims" means any claim, action or proceeding based on personal injury, death or other similar
adverse effect to humans caused by (or alleged to be caused by) use of the Product. 

        1.44    "Product Warranty" shall have the meaning given in Section 16.1. 

        1.45    "Purchase Orders" shall have the meaning given in Section 5.3. 

        1.46    "Purchaser Customers" means, in each case to the extent located in the Territory, (a) chain retail pharmacies and
stores, (b) independent retail pharmacies, (c) grocery and food stores, (d) mail order pharmacies, (e) certain other types of customers not included within items (a)-(d)
that are pre-approved in writing by Seller pursuant to an amendment to this Agreement, and (f) drug wholesalers (solely to the extent allocated for resale to customers included in
items (a)-(e) above). Notwithstanding anything herein to the contrary, Seller expressly retains all rights to all current and future customers and markets for the Product, other than the customers
expressly included in items (a)-(f) above; and, without limiting the foregoing and by way of clarification, Seller's retained rights shall expressly include the right to sell Product to drug
wholesalers so long as Seller does not supply, sell or distribute Product to drug wholesalers for resale to any customer included in items (a)-(e) above. 

        1.47    "Purchaser Recall" shall have the meaning given in Section 11.3.2. 

        1.48    "Purchaser Trademarks" shall have the meaning given in Section 6.3. 

        1.49    "Raw Material Costs" shall have the meaning given in Section 4.1. 

        1.50    "Seller Launch" shall have the meaning given in Section 2.3. 

        1.51    "Specifications" means the specifications for the composition, manufacture, Packaging and/or quality control of the
Product as described in the ANDA for the Product, as the same may be supplemented from time to time as expressly provided in this Agreement. 

        1.52    "Territory" means the United States of America and its territories, including the Commonwealth of Puerto Rico. 

        1.53    "Third Party Infringement Claim" shall have the meaning given in Section 17.4. 

        1.54    "Transfer Price" shall have the meaning given in Section 4.1. 

        1.55    "Unit Price" shall have the meaning given in Section 4.1. 

ARTICLE 2

APPOINTMENT; SUPPLY AND PURCHASE OF PRODUCT  

        2.1    Appointment; Agreement to Supply; Development.

        2.1.1    Subject to the terms and conditions of this Agreement, Seller hereby appoints Purchaser as its exclusive distributor of
the Product for sale and distribution to Purchaser Customers in the Territory, and Purchaser hereby accepts such appointment. Subject to the terms of this Agreement, Seller shall use its Commercially
Reasonable Efforts to manufacture and supply 

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to
Purchaser its requirements of the Product for sale and distribution to Purchaser Customers in the Territory in accordance with Purchaser's Purchase Orders as provided herein. Seller shall not, and
shall cause its Affiliates not to, manufacture or supply the Product to Purchaser Customers in the Territory. Notwithstanding anything herein to the contrary, the parties acknowledge and agree that
Seller retains all rights to develop, manufacture, supply, sell, distribute, market, promote and otherwise commercialize, directly or through Seller's Affiliates or third parties, Product to customers
other than Purchaser Customers in the Territory; and without limiting the foregoing and by way of clarification, Seller's retained rights shall expressly include the right to sell Product to drug
wholesalers or any other Persons so long as Seller shall not supply, sell or distribute Product to drug wholesalers or any other Person for resale to any customer included in items (a)-(e) of
Section 1.46. 

        2.1.2    Seller hereby represents that it has filed with the FDA ANDA, File No. 76-684, for the Product.
Seller shall, at its expense, use Commercially Reasonable Efforts to prosecute the ANDA and to obtain approval from the FDA of the ANDA. Seller shall promptly upon its receipt of same deliver to
Purchaser written notice certifying that Seller has received final FDA approval of the Product's ANDA. The ANDA and all other regulatory approvals related to the manufacture and supply of the Product
shall be in Seller's name and owned exclusively by Seller. In addition, Seller shall, at its expense, use Commercially Reasonable Efforts to obtain a Favorable Resolution to enable FDA
approval of the Product's ANDA and the launch of the Product in the Territory. Notwithstanding the foregoing, nothing herein shall constitute a guarantee or warranty from Seller that the ANDA for the
Product will be approved by the FDA, or, if the Product ANDA is approved, any market exclusivity will be awarded, or any other regulatory approvals will be obtained by Seller or that a Favorable
Resolution will be obtained. Nothing herein shall limit Purchaser's right to terminate this Agreement pursuant to its terms. 

        2.2    Agreement to Purchase.

        2.2.1    Subject to the terms of this Agreement, Purchaser shall purchase exclusively from Seller all of Purchaser's
requirements for the Product for marketing, sale and distribution to Purchaser Customers in the Territory. Purchaser shall use Commercially Reasonable Efforts to market, sell and distribute the
Product throughout the Territory to Purchaser Customers. Subject to the foregoing, Purchaser does not make any guaranty or warranty as to any minimum level of Gross Profits or Net Sales. Nothing
herein shall limit each party's right to terminate this Agreement pursuant to its terms, including Section 8.4. Unless otherwise consented to in writing by Seller, Purchaser shall not offer the
Product as a loss leader, whether alone or in connection with any other product or sell the Product in combination or otherwise bundle the Product with other products in any fashion which decreases
the revenue that would otherwise be attributable to the Product had it not been sold as a loss leader or in combination or otherwise bundled. Subject to the foregoing and Purchaser performing its
obligations hereunder (including its obligation to use Commercially Reasonably Efforts to sell and distribute the Product), launch timing, pricing, marketing, sale and distribution and related
strategy for the Product for sale and distribution to Purchaser Customers in the Territory shall be the sole responsibility of, and shall be solely controlled by, Purchaser. 

        2.2.2    Purchaser shall, and shall cause its Affiliates to, sell and distribute the Product only to Purchaser Customers in the
Territory and only in accordance with Applicable Law and the Product's ANDA. Purchaser shall reasonably cooperate with Seller in investigating and tracing any sales of the Product outside of the
Territory or to any Persons in the Territory other than Purchaser Customers originating from sales by Purchaser hereunder. Seller shall not, and shall cause its Affiliates not to, sell and distribute
the Product to Purchaser Customers in the Territory (provided that, by way of clarification, Seller may sell Product to drug wholesalers or any other Persons so long as Seller shall not supply, sell
or distribute Product to drug wholesalers or any 

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other
Persons for resale to any customer included in items (a)-(e) of Section 1.46). Seller shall reasonably cooperate with Purchaser in investigating and tracing any sales of the Product to
any Purchaser Customers originating from sales by Seller hereunder. 

        2.2.3    During the term of this Agreement and, if this Agreement is terminated by Purchaser pursuant to Section 8.4, for
a period of 12 months after such termination, neither Purchaser nor its Affiliates shall sell or distribute in the Territory any product that is or purports to be a generic equivalent (i.e.
bioquivalent and legally substitutable) of the Lovenox® brand product, other than the Product supplied by Seller hereunder. [***] 

        2.3    Commercial Launch of the Product.

        2.3.1    Notice of Launch. At any time after Seller receives both (i) a Favorable Resolution (which may, but is not
required to be, a Final Favorable Resolution) and (ii) FDA approval of the Product's ANDA and confirmation from the FDA that Seller has been awarded 180 days of "first to file" market
exclusivity in accordance with Section 505(j)(5)(B)(iv) of the Act, Seller shall be entitled to deliver to Purchaser a written notice setting forth Seller's intention to commence the
commercial sale of the Product in the Territory. Such written notice shall be referred to herein as an "At-Risk Launch Notice," unless based on a Final Favorable Resolution, in which case
such written notice shall be referred to herein as a "Non-At-Risk Launch Notice." As used herein, a "Launch Notice" may refer generally to an At-Risk Launch Notice
and/or a Non-At-Risk Launch Notice. Notwithstanding the foregoing, in the event that Seller receives FDA approval of the Product's ANDA, but Seller is not awarded
180 days "first to file" market exclusivity and/or has not received a Favorable Resolution, Seller, at its option, may notify Purchaser of Seller's desire to commence the commercial sale of the
Product in the Territory. In such event, Seller and Purchaser shall negotiate in good faith the terms and conditions of any Product launch to Purchaser Customers in the Territory; provided that, by
way of clarification, nothing herein shall prevent (i) Seller from selling and distributing such Product in the Territory so long as Seller does not sell or distribute such Product to Purchaser
Customers (provided that, by way of clarification, Seller may sell Product to drug wholesalers or any other Persons so long as Seller shall not supply, sell or distribute Product to drug wholesalers
or any other Persons for resale to any customer included in items (a)-(e) of Section 1.46) or (ii) Purchaser from terminating this Agreement pursuant to its terms. 

        2.3.2    At-Risk Launch. In the event that Purchaser receives an At-Risk Launch Notice, Purchaser shall
notify Seller in writing within 10 days of Purchaser's receipt thereof whether or not Purchaser agrees to launch the commercial sale of the Product to Purchaser Customers in the Territory as
contemplated herein based on such At-Risk Launch Notice (an "At-Risk Launch"). In the event that Purchaser notifies Seller that it has determined to engage in an
At-Risk Launch, Purchaser shall proceed according to the provisions of Section 2.3.3 below. In the event that Purchaser notifies Seller that it has determined to not engage in an
At-Risk Launch, Seller shall have 10 days from receipt of Purchaser's notice to notify Purchaser in writing whether or not Seller has determined to engage in an At-Risk
Launch without Purchaser acting as Seller's distributor of the Product to the Purchaser Customers in the Territory (a "Seller Launch"). In the event that Seller notifies Purchaser that it has
determined to so engage in a Seller Launch, subject to Sections 2.3.4 and 2.3.5 below, this Agreement (including any rights of Purchaser to sell and distribute the Product in the Territory) shall
automatically and immediately terminate as of the date of such Seller's notice to Purchaser. In the event that Seller notifies Purchaser that it has determined to not engage in a Seller Launch, this
Agreement shall continue in full force and effect and Seller may at any time thereafter submit a new Launch Notice, at which time the parties shall, among other things, again proceed in accordance
with the provisions of this Section 2.3. 

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

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        2.3.3    Obligation to Launch. In the event that Seller delivers to Purchaser a Non-At-Risk Launch
Notice or Purchaser notifies Seller that Purchaser has determined to engage in an At-Risk Launch, Purchaser shall (i) pay the milestone payment set forth in Section 3.1(b)
below in accordance with the provisions thereof, and (ii) subject to the terms of this Agreement, Purchaser shall use Commercially Reasonable Efforts to commence with Purchaser's First
Commercial Sale as soon as commercially practicable thereafter, but in no event later than 5 business days following Purchaser's receipt of Launch Quantities. 

        2.3.4    Payment of Compensatory Payments upon a Seller Launch. Subject to Section 2.3.5 below, in the event that Seller
engages in a Seller Launch, Seller shall pay to Purchaser payments (the "Compensatory Payments"), up to the aggregate amount of [***] (the "Maximum Compensatory Payments"),
equal to: 

        (a)    during the first six full calendar months following Seller's First Commercial Sale pursuant to the Seller Launch, the
greater of (i) [***] of Seller's Net Sales of Product sold in the Territory and (ii) [***]; 

        (b)    during the second six full calendar months following Seller's First Commercial Sale pursuant to the Seller Launch, the
greater of (i) [***] of Seller's Net Sales for Product sold in the Territory and (ii) [***]; and 

        (c)    [***] of Seller's Net Sales of Product sold in the Territory during each calendar quarter after
the first twelve full calendar months after Seller's First Commercial Sale pursuant to the Seller Launch. 

        2.3.5    The Compensatory Payments shall be paid within 30 days of the end of each calendar quarter following Seller's
First Commercial Sale pursuant to the Seller Launch. Each Compensatory Payments payment shall include a report setting forth in reasonable detail the amount of and the basis for such payment,
including a calculation of Seller's Net Sales (including itemizing all deductions to gross sales) for such quarterly period. With respect to any payment due as a result of the
[***] minimum Compensatory Payments amounts set forth in Sections 2.3.4(a) and (b) above, such payment shall be made within 30 days of the end of the calendar
quarter that contains the sixth month of the applicable six month period for which the [***] minimum Compensatory Payments amount accrued. Any payments not made within the
specified period of time for payment shall incur an interest charge at the rate of the Overdue Interest Amount on such overdue amounts, excluding any amounts that are subject to a bona fide dispute
between the parties. 

        2.3.6    Subsequent Suspension of a Seller Launch.    In the event that, within 30 days of Seller's First
Commercial Sale pursuant to a Seller Launch, Seller either voluntarily or as a result of an order of the FDA or any court having competent jurisdiction ceases to sell in and withdraws the Product from
the market in the Territory, Seller's obligation to pay the Compensatory Payments pursuant to such Seller Launch shall immediately terminate as of the date of such withdrawal and this Agreement shall
be automatically and immediately reinstated and be in full force and effect on and after the date of such withdrawal pursuant to its terms. Without limiting the generality of the preceding sentence,
in the event that, at any time after such withdrawal of the Product, Seller determines to engage in a new commercial launch of the Product in the Territory, Seller shall provide to Purchaser a Launch
Notice pursuant to Section 2.3.1 above and the remaining provisions of this Section 2.3 shall again apply to such new Launch Notice. In the event that Seller after such withdrawal of the
Product delivers to Purchaser a Non-At-Risk Launch Notice or Purchaser notifies Seller that it will engage in an At-Risk Launch in accordance with
Section 2.3.2 above following receipt of an At-Risk Launch Notice, in addition to the payment of the milestone payment under Section 3.1(b) required in connection therewith,
Purchaser shall refund to Seller any amount of the Compensatory Payments previously paid to Seller within 

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

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10 days
of receipt by Purchaser of such Non-At-Risk Launch Notice or receipt by Seller of Purchaser's notice of intention to engage in an At-Risk Launch. In
the event that Purchaser determines to not engage in such subsequent At-Risk Launch and Seller commences a subsequent Seller Launch, (i) each of the [***]
minimum Compensatory Payments amounts under Sections 2.3.4(a) and (b) shall be reduced to an amount equal to [***] multiplied by a fraction, the numerator of which is
the number of months of Product sales under all previous Seller Launches pursuant to which Seller paid Compensatory Payments and the denominator of which is six and (ii) the Maximum
Compensatory Payments shall be reduced by the amount all Compensatory Payments previously paid to Purchaser. 

        2.4    Termination of Agreement Relating to Commercial Launch.

        2.4.1    In addition to Purchaser's termination rights set forth elsewhere herein, Purchaser shall be entitled to terminate this
Agreement as set forth in this Section 2.4.1: 

        (a)    Purchaser may terminate this Agreement after [***], upon [***] prior
written notice to Seller, if Seller shall not have obtained a Favorable Resolution on or prior to [***], so long as such termination notice is received by Seller on or before
[***]. 

        (b)    Provided that Purchaser shall not have notified Seller that it will engage in an At-Risk Launch prior
thereto, Purchaser may terminate this Agreement after [***], upon [***] prior written notice to Seller,
if after [***] an Adverse Resolution then exists, so long as such termination notice is received by Seller within [***] after the later of
[***] or the date Purchaser is notified of such Adverse Resolution. Seller shall provide written notice to Purchaser within [***] of any Adverse
Resolution. For purposes of clarification, Purchaser's right to terminate this Agreement under this Section 2.4.1(b) shall not apply after Seller's delivery to Purchaser of a Launch Notice,
unless such Launch Notice is an At-Risk Launch Notice, and then only in the event that this Agreement remains in effect pursuant to Seller's determination to not engage in a Seller Launch
under Section 2.3.2 or this Agreement is reinstated following a Product withdrawal pursuant to Section 2.3.6. 

        (c)    Purchaser may terminate this Agreement after [***], upon [***] prior
written notice to Seller, if Seller shall not have delivered to Purchaser a Launch Notice on or before [***], so long as such termination notice is received by Seller on or
before [***] 

        2.4.2    Notwithstanding anything herein to the contrary, Purchaser's sole remedy, whether in contract, tort or otherwise, for
any failure by Seller to use Commercially Reasonable Efforts to obtain ANDA approval of the Product or any market exclusivity with respect thereto and/or any additional regulatory approvals necessary
for the manufacture and supply of the Product and/or to obtain a Favorable Resolution shall be the termination of this Agreement as provided in this Section 2.4 and the right to any refund of
the milestone payment under Section 3.2. 

        2.4.3    This Agreement may be terminated by Seller upon 5 days written notice to Purchaser, if Purchaser shall have not
effected Purchaser's First Commercial Sale within 5 business days following Purchaser's receipt of Launch Quantities in accordance with Section 2.3.3. 

        2.5    Sales to Wholesalers. Subject to the terms and conditions of this Agreement, Purchaser shall have exclusive rights to
sell Product to drug wholesalers or any other Persons for resale and distribution to the customers in the Territory identified in items (a)-(e) of Section 1.46. Seller retains all rights to all
other current and future customers and markets for the Product, including the right to sell Product to drug wholesalers or any other Persons so long as Seller does not supply, sell or distribute
Product to drug wholesalers or any other Persons for resale to any customer included in items (a)-(e) of Section 1.46. As permitted by Applicable Law, Purchaser and Seller shall cooperate in
creating arrangements with their respective drug wholesalers and other customers necessary to implement the foregoing. From time to time upon request, each party shall provide the other with
reasonable access to 

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

8

 

all
information in its possession and control (or which is reasonably obtainable) to confirm the ultimate customer of the Products sold by it to drug wholesalers or other Persons. To the extent Seller
sells any Products to drug wholesalers or other Persons that are ultimately purchased by any customer included in items (a)-(e) of Section 1.46, Seller shall pay Purchaser its portion of the
Gross Profits (i.e., Seller's Net Sales less the imputed Transfer Price of the Product times Purchaser's then applicable portion of the Gross Profit Split) attributable to such sales by Seller plus
the Overdue Interest Amount on the amount due from the date of the sale to the date of payment. To the extent Purchaser sells any Product to drug wholesalers or other Persons that are ultimately
purchased by any customer not included in items (a)-(e) of Section 1.46, then Purchaser shall pay to Seller all of the Gross Profit attributable to such sales by Purchaser plus the Overdue
Interest Amount on the amount due from the date of the sale to the date of payment. The above described Gross Profit reimbursement shall be each party's exclusive remedy for any inadvertent and
unintentional breach by the other party of its obligations under this Section 2.5. In addition, without limiting either party's indemnification obligations under Article 17, if either
party intentionally breaches this Section 2.5, the party in breach shall indemnify the other party pursuant to Article 17 for all Damages caused thereby. 

        2.6    Information. Seller shall provide Purchaser with copies of all material study results and other written communications
that Seller submits to the FDA in connection with its attempt to obtain approval of the Product's ANDA or otherwise relating to the Product as soon as reasonably practicable after Seller's receipt or
submission thereof. At Purchaser's request from time to time during normal business hours and upon reasonable notice, Seller shall also provide Purchaser reasonable access to any other study results
and other written communications that Seller submits to the FDA in connection with its attempt to obtain approval of the Product's ANDA or otherwise relating to the Product in Seller's possession. In
addition, Seller shall provide Purchaser with copies of all material pleadings, motions, briefs and other written communications relating to the Lawsuit as soon as reasonably practicable after
Seller's receipt or submission thereof. At Purchaser's request from time to time during normal business hours and upon reasonable notice, Seller shall provide Purchaser with reasonable access to any
other pleadings, motions, briefs and other written communications relating to the Lawsuit in Seller's possession. The obligations of Seller provided above shall be subject to Applicable Law (including
compliance with any protective order or other court or governmental agency order or requirement), maintaining applicable privileges and the terms of any confidentiality obligations of Seller owned to
third parties. 

ARTICLE 3

MILESTONES AND PAYMENTS  

        3.1    Milestones and Payments. In consideration of Seller's grant of the exclusive distribution rights hereunder to Purchaser,
Purchaser shall pay Seller the following amounts upon completion of the applicable milestone: 

	Milestone:
 
	 	Amount of Payment Due:

	    (a)    The Effective Date of this Agreement	 	$	4,500,000
	

    (b)    Within 10 days of both (x) either (i) Purchaser's receipt of a Non-At-Risk Launch Notice under Section 2.3.1 above or (ii) Purchaser's written notice to Seller that Purchaser will engage in an
At-Risk Launch under Section 2.3.2 above and (y) delivery to Purchaser of the Launch Quantities.	
 	
$	

5,500,000
	

    TOTAL:	
 	
$	

10,000,000

9

 

        3.2    Payment Terms; Refund.

        3.2.1    Any payments not made within the specified period of time for payment shall incur an interest charge at the rate of the
Overdue Interest Amount on such overdue amounts, excluding any amounts that are subject to a bona fide dispute between the parties. All payments shall be made in U.S. dollars through electronic
transfer of funds or other wire transfers. 

        3.2.2    Except as expressly set forth in this Section 3.2.2, no milestone payment shall be refundable in whole or in
part under any circumstance, including a termination of this Agreement pursuant to Seller engaging in a Seller Launch under Section 2.3.2. The $4,500,000 milestone payment paid to Seller under
Section 3.1(a) above shall be refunded by Seller to Purchaser in the event this Agreement is terminated pursuant to Section 2.4.1 above; provided, however, in the event that this
Agreement is terminated pursuant to Section 2.4.1 at any time after Seller shall have paid Compensatory Payments to Purchaser, the amount of such Compensatory Payments shall be deducted from
such refund of the milestone payment and any amount of such Compensatory Payments in excess of the amount of the milestone payment shall be refunded to Seller within 30 days of such
termination. All such refunds shall be made by Seller within 30 days after the applicable termination date; provided that, such amount remaining outstanding shall bear simple interest at the
rate of the Overdue Interest Amount commencing on the date such amount is due and payable (i.e., 30 days after the applicable termination date) until paid in full; and provided further that, if
Seller does not have at the time the available funds to repay Purchaser such amount, such amount shall be repaid no later than one year from the applicable termination date. If payment is not made
within 30 days of termination, upon request of Purchaser, Seller shall (as soon as reasonably practicable) provide Purchaser with reasonable security for repayment of any milestone payments not
paid when due, including potentially, assignment of product revenues or a lien on other assets. 

ARTICLE 4

PRICING  

        4.1    Transfer Price.

        4.1.1    The transfer price ("Transfer Price") payable by Purchaser for Product delivered by Seller shall be a payment equal to
the product of (a) the number of units of Product delivered by Seller to Purchaser pursuant to the applicable Purchase Order (including the Initial Purchase Order), multiplied by
(b) [***] unit, regardless of dosage strength (the "Unit Price"). Notwithstanding the foregoing, on and after the [***] of the First Commercial
Sale, Seller may increase the Unit Price during each twelve month period (which begins on an anniversary of the First Commercial Sale), effective upon 30 days prior written notice to Purchaser
(or upon the later resolution of any disputed price increase, except if such dispute is resolved in Seller's favor in which case the Unit Price increase shall be effective 30 days from Seller's
original notice
thereof to Purchaser), by (i) the actual per unit increase in Seller's raw materials costs (the "Raw Material Costs") for the Product (including the costs of plunger rods, needle stick
prevention devices, syringes, Packaging and other ingredients and materials used to manufacture and process the Product) over the 12 month period preceding the date of Seller's notice of such
price increase not to exceed (subject to Section 4.1.2) [***] of the amount of Seller's Raw Material Costs as at the beginning of the 12-month period
immediately prior to such price increase and (ii) the actual per unit increase in Seller's direct labor costs ("Labor Costs") for the Product over the prior 12 month period preceding the
date of Seller's notice of such price increase not to exceed (subject to Section 4.1.2) [***] of the amount of the Seller's Labor Costs as at the beginning of the
12-month period immediately prior to such price increase. Seller shall provide Purchaser with reasonable documentation evidencing the applicable increases in Seller's Raw Material Costs
and Labor Costs 

[***]
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respect to the omitted portions. 

10

 

with
Seller's notice of the price increase. Purchaser may dispute in good faith any increase to the Unit Price pursuant to this Section 4.1.1 by written notice to Seller within 10 days
of Purchaser's receipt of Seller's notice thereof. If the dispute is not resolved within 30 days of Purchaser's dispute notice to Seller, then Purchaser may elect to seek resolution of the
dispute pursuant to the provisions of Section 4.5 by providing written notice to Seller of such election. If Purchaser does not provide Seller such written notice within 10 days after
the aforementioned 30 day period, then the dispute shall be deemed resolved in Seller's favor. 

        4.1.2    At the written request of Seller on and after the [***] of the First Commercial Sale, the
parties shall discuss increases in the Unit Price in excess of the respective [***] limitations provided in Section 4.1.1 to the extent such increases are due to
increases in Raw Material Costs and/or Labor Costs attributable to changes required by Applicable Law or governmental authority, including FDA, as provided in Section 6.2.1. Any such request
for an increase in the Unit Price in excess of the respective [***] limitations provided in Section 4.1.1 shall be reasonably considered in good faith by Purchaser but
shall not be implemented without Purchaser's written consent (which shall not be unreasonably withheld, delayed or conditioned). In the event Seller's Raw Material Costs and/or Labor Costs increase by
[***] or more during any twelve month period as a result of changes required by Applicable Law or governmental authority, including FDA, as provided in Section 6.2.1
(based on reasonable documentation) and Purchaser does not consent to a corresponding increase as requested by Seller in the Unit Price in excess of the respective [***]
limitations (as the case may be) provided in Section 4.1.1 within [***] of
the date of Seller's written request for such increase, then Seller shall (by written notice within [***] of the date of Seller's written request for such increase) have the
right to terminate this Agreement upon [***] written notice to Purchaser. 

        4.2    Gross Profit Split.

        4.2.1    Purchaser shall pay to Seller, as additional consideration for Seller's supply of Product hereunder to Purchaser, the
following portion of Gross Profit (the "Gross Profit Split"): 

        (a)    60% [***]; 

        (b)    55% [***] 

        (c)    50% [***]. 

        4.2.2    Seller's Gross Profit Split shall be calculated and paid to Seller quarterly, within 30 days after quarter end.
Any adjustment to the Gross Profit Split as required from time to time due to an increase or decrease in the number of Competitive Products or Purchaser's Net Sales shall be effective upon the day of
the calendar month in which the change of number of Competitive Product(s) occurred in the case of Section 4.2.1(b)(i) and (c)(i) above and upon the first day of the immediately
succeeding calendar month after the calendar month in which the change in Purchaser's Net Sales triggered an adjustment to the Gross Profit Split in the case of Section 4.2.1(b)(ii) or
(c)(ii) above. Notwithstanding anything herein to the contrary and by way of clarification, any adjustment to the Gross Profit Split resulting from a change in the number of Competitive
Products or Net Sales shall change only the Gross Profit Split of Product having the same dosage strength as that of the relevant Competitive Product(s) then being sold and distributed in the
Territory. Each party shall provide the other party prompt written notice of any adjustment to the Gross Profit Split which the notifying party believes is warranted as a result of a change in the
number of Competitive Products or Purchaser's Net Sales. With such notice, the notifying party shall provide an explanation to the other party as to the reasons why such adjustment is warranted and
shall provide the other party any documentation in notifying party's possession or control which supports the notifying party's basis for such adjustment. 

[***]
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respect to the omitted portions. 

11

 

        4.3    Shipping Terms. The prices charged by Seller to Purchaser shall be FCA (Incoterms 2000), Seller's designated
manufacturing facility. 

        4.4    Payment Terms.

        4.4.1    The Transfer Price for the Product shall be paid within 30 days of the date of the applicable invoice for such
Product. 

        4.4.2    The Gross Profit Split shall be paid within 30 days of the end of each calendar quarter, with a report setting
forth in reasonable detail the amount of and the basis for such payment, including a calculation of Purchaser's Net Sales (including itemizing all deductions to gross sales), Gross Profit and the
Gross Profit Split (as applicable on a dosage strength basis) for such quarterly period [***]. 

        4.4.3    Any payments not made within the specified period of time for payment shall incur an interest charge at the rate of the
Overdue Interest Amount on such overdue amounts, excluding any amounts that are subject to a bona fide dispute between the parties. In addition, Seller
may withhold shipment of Product to Purchaser if Purchaser has failed to make any payment required under this Agreement (except for any amounts that are subject to a bona
fide dispute) after the due date for such payment. All payments shall be made in U.S. dollars through electronic transfer of funds or other wire transfers. 

        4.5    Audit Rights. Purchaser with respect to Section 2.2.3 and this Article 4 and Seller with respect to
Sections 2.3.4 and 4.1 shall keep complete and accurate books and records for purposes of documenting the amount and calculations of, as applicable, Net Sales [***], Gross
Profit, Gross Profit Split, the Compensatory Payments and, to the extent it is a basis for an increase in the Transfer Price pursuant to Section 4.1, increases in Raw Material Costs and Labor
Costs. Said books of account shall be kept at Purchaser's or Seller's principal place of business, as applicable. Upon reasonable notice, each Purchaser or Seller, as applicable, at its expense, shall
have the right to have an independent public accounting firm (reasonably acceptable to the other party) obtain access to the other party's financial records, during reasonable business hours, solely
for the purpose of verifying such party's payments hereunder; provided, however, that this right may not be exercised more than once in any calendar year (unless a prior audit by the audited party in
such calendar year reveals a discrepancy of the greater of 5% of the payment(s) audited or $25,000 in any calendar quarter and then the auditing party may exercise its audit right no more than twice
during such calendar year). The accountants engaged by the auditing party shall report to the auditing party only information of the audited party related to the accuracy of the audited party's
calculations then being audited. The findings of the accountants engaged by the auditing party shall be final and binding
upon the parties hereto, and the payments attributable to any particular period may only be audited once for such period. Any underpayment or overpayment of the amount due hereunder due to a
miscalculation of such amount shall be paid within 30 days after the delivery of a written accountants' report to each party. In the event any such audit reveals a shortfall greater than 5% of
the payment(s) audited or $25,000 in any calendar quarter, then the reasonable costs of the accountants engaged by the auditing party to perform such audit shall be reimbursed by the audited party.
Any underpayment or overpayment amount paid pursuant to this Section 4.5 shall accrue interest on such amount from the original due date at the Overdue Interest Amount. 

ARTICLE 5

LAUNCH QUANTITIES, FORECASTS, ORDERS  

        5.1    Initial Purchase Order; Launch Quantities. Within 5 days following receipt of a
Non-At-Risk Launch Notice by Purchaser or delivery to Seller of Purchaser's notice that it will engage in an At-Risk Launch, Purchaser shall deliver to Seller an
initial binding order (the "Initial Purchase Order") for the quantity of Product required for Purchaser's commercial launch of the Product consistent with 

[***]
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respect to the omitted portions. 

12

 

Purchaser's
then current Forecast; provided that, such quantity shall not exceed (without the prior written consent of Seller, which may be withheld in its sole discretion)
[***] units of Product if the First Commercial Sale occurs in calendar year 2005 or [***] of the then existing Maximum Annual Product Units if the First
Commercial Sale occurs in any calendar year after 2005 (the "Launch Quantities"). Subject to the terms of this Agreement, Seller shall use Commercially Reasonable Efforts to supply the Product to
Purchaser in the Launch Quantities by no later than the delivery dates indicated in the Initial Purchase Order, which delivery dates shall be no sooner than 90 days after the date of the
Initial Purchase Order unless Seller consents thereto. Seller shall thereafter use Commercially Reasonable Efforts to supply to Purchaser such additional quantities of the Product as ordered by
Purchaser hereunder pursuant to Section 5.3. 

        5.2    Forecasts. Beginning at least 6 months prior to the anticipated date of FDA approval of the Product's ANDA and at
least 90 days prior to each calendar quarter thereafter, Purchaser shall provide to Seller a rolling 12-month forecast (each a "Forecast") of the quantities of the Product to be
purchased by Purchaser on a monthly basis. Without limiting the foregoing, in addition to the above Product quantities, each Forecast delivered by Purchaser prior to its First Commercial Sale shall
include the Launch Quantities. Forecasts shall be in good faith and non-binding, provided, however, that (a) on and after Purchaser's delivery of its Initial Purchase Order to
Seller, the first three months of each Forecast shall be binding on Purchaser, and shall constitute Purchaser's firm order for the quantity of Product set forth in such Forecast; and
(b) forecasted quantities of the Product for the fourth, fifth and sixth months forecasted thereunder shall not increase by more than 25% from the quantities forecasted for such months in the
preceding Forecast without Seller's prior written consent (not to be unreasonably withheld or delayed). 

        5.3    Orders. Except for the Initial Purchaser Order, Purchaser shall deliver to Seller purchase orders ("Purchase Orders") for
the Product no later than 90 days before the date that the Products for such Purchase Order are required to be delivered to Purchaser and provided such Purchase Orders are for the binding
portion (i.e., the first three months) of the then current Forecast in accordance with Section 5.2, Seller shall accept such Purchase Orders. Subject to Section 5.6, Seller shall use
Commercially Reasonable Efforts to satisfy Purchase Orders for amounts in excess of those forecasted for the binding portion of the then current Forecast pursuant to Section 5.2; provided that
in no event shall Seller be required to add to its existing manufacturing capacity of its facility(ies) for the Product in order to satisfy Purchaser's Purchase Orders. Each such Purchase Order shall
be firm and shall specify the quantity of the Product ordered, the date on which such Product shall be delivered and the delivery address. Product shall be ordered by Purchaser in no less than full
batch increments. 

        5.4    Shipping Reports. On or promptly after the date of each shipment of Product, Seller shall submit to Purchaser, via
facsimile, a packing slip containing the ship date, trailer number, contents and quantities of each shipment and invoice for the Transfer Price. 

        5.5    Standard Forms; Conflicts. In ordering and delivering the Product pursuant hereto, Seller and Purchaser may use their
standard forms (including Purchase Orders, invoices, sales acknowledgments, etc.), but nothing in those forms shall be construed to modify, amend or supplement the terms of this Agreement and, in case
of any conflict herewith, the terms of this Agreement shall control, and any additional or modified terms contained in any such Purchase Order or other form shall be null and void and shall not be
binding upon the receiving party. 

        5.6    Capacity Allocation.

        5.6.1    Notwithstanding anything herein to the contrary or anything to the contrary in any Purchase Order or Forecast, Seller
shall not be obligated to supply Purchaser (regardless of amounts ordered by Purchaser), more than the then applicable Maximum Annual Product Units during a twelve month period. Without limiting the
foregoing, any Purchase Order or Forecast 

[***]
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respect to the omitted portions. 

13

 

submitted
by Purchaser hereunder for more than the then applicable Maximum Annual Product Units shall, to the extent of the excess, be deemed rejected by Seller, unless expressly accepted by Seller in
writing. As used herein, the term "Maximum Annual Product Units" shall mean for the period ending twelve full calendar months from the First Commercial Sale and for each twelve month period
thereafter, [***] of the total units of branded and generic Lovenox® product (including the brand name product, the Product, any Authorized Generic Product and any
Competitive Product) sold for distribution into the Territory for the immediately preceding calendar year as reported by IMS Health (or such other nationally recognized data compilation source as
mutually agreed); provided that, if the First Commercial Sale occurs during calendar year 2005, then the Maximum Annual Product Units for the period ending twelve full calendar months from the First
Commercial Sale shall be deemed to be [***] of Product. For each twelve month period beginning after the First Commercial Sale (other than as provided above if the First
Commercial Sale occurs in calendar year 2005), the Maximum Annual Product Units shall be established as soon as data from IMS Health (or such other nationally recognized source as mutually agreed) for
the immediately preceding calendar year becomes available to the parties and once the Maximum Annual Product Units for the then current twelve month period is established, it shall be effective
retroactively to the beginning of and shall be fixed through such twelve month period. Without limiting the foregoing, but by way of example: If the First Commercial Sale occurs on September 1,
2005, then the Maximum Annual Product Units for the twelve month period ending with August 31, 2006 would be [***] units of Product. As a result, Purchaser would have no
right to order or purchase, and Seller would have no obligation to supply, more than [***] units of Product during the twelve month period ending August 31, 2006.
Assuming that [***] total units of branded and generic Lovenox® product were sold for distribution into the Territory for the 2005 calendar year as reported by IMS
Health, then the newly established Maximum Annual Product Units for the twelve month period ending August 31, 2007 would be [***] units of Product (i.e.,
[***] units). As a result, Purchaser would have no right to order or purchase, and Seller would have no obligation to supply, more than [***] units of
Product during the twelve month period ending August 31, 2007. The foregoing process would be repeated once each twelve month period thereafter to establish the Maximum Annual Product Units for
the then current twelve month period. At Purchaser's request from time to time, the parties shall discuss increasing the then existing Maximum Annual Product Units based on then existing market
conditions, Seller's manufacturing capacity and other relevant factors. Seller shall reasonably consider Purchaser's request and its reasons for an increase in the then existing Maximum Annual Product
Units; provided that, Seller shall have no obligation to agree to (and may reject in Seller's sole discretion and without liability) any increase requested by Purchaser in the then existing Maximum
Annual Product Units. 

        5.6.2    In the event that Seller's inability (including any inability as a result of a Force Majeure Event) to satisfy any
Purchase Order accepted pursuant to Section 5.3, in whole or in part, is due to a shortage of production capacity or raw materials, then, subject to the terms and conditions of this Agreement,
including Section 5.6.1 above, Seller shall give priority to Purchaser's Purchase Orders, and satisfy deliveries of amounts ordered consistent with Section 5.3 prior to fulfilling order
for Product of any other Person, for up to (i) [***] units of Product to be delivered to Purchaser pursuant to its Purchase Orders for the period ending six full
calendar months after the First Commercial Sale and (ii) [***] units of Product to be delivered to Purchaser pursuant to its Purchase Orders during each six month period
thereafter and for any Product to be delivered to Purchaser pursuant to its Purchase Orders during such six month period in excess of the foregoing [***] unit amount,
[***] of Seller's units of its finished inventory of Product produced during the applicable period in excess of [***] units shall be allocated to
fulfill any such remaining outstanding Purchase Orders. 

[***]
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respect to the omitted portions. 

14

 
ARTICLE 6

SPECIFICATIONS  

        6.1    Specifications. The Specifications for the Product will be as described in the ANDA that is approved by FDA for the
Product. The Specifications for the Product shall not be changed except as expressly permitted under this Agreement. 

        6.2    Change Management.

        6.2.1    Required Changes.    With respect to any changes to the Specifications or to any process involved in the
manufacture, Packaging, Labeling, storage, transportation, delivery or testing of the Product that are required by Applicable Laws or by mandate of an applicable government authority (including the
FDA), the parties shall reasonably cooperate in making such changes promptly, and Seller shall, subject to Section 4.1 and unless otherwise mutually agreed to in writing by the parties, bear
the costs of implementing such changes, including the cost of scrapping materials (including raw materials, in-process materials, inventory and packaging material) associated with such
changes. 

        6.2.2    Discretionary Changes.    With respect to changes to the Specifications or to any process involved in the
manufacture, Packaging, Labeling, storage, transportation, delivery or testing of the Product that are not required by Applicable Laws or by mandate of an applicable government authority (including
the FDA), the parties shall cooperate in good faith to reach a mutually agreeable solution with regard to such changes, but Seller shall not be obligated to make any such changes requested by
Purchaser except as expressly provided in Section 6.2.3. Seller reserves the right to make such changes unilaterally; provided, however, that
Seller will consult with Purchaser prior to making such changes; and provided further that, Seller shall obtain Purchaser's prior written consent (which will not be unreasonably withheld or delayed)
for any changes that would materially affect storage or transportation of the Product after delivery to Purchaser. The cost of making a discretionary change shall be borne solely by the party
initiating the change or as otherwise mutually agreed to in writing by the parties. In the event any such changes initiated by Purchaser increase Seller's costs of manufacturing and supplying the
Product to Purchaser, at Seller's request, the parties shall discuss and agree in good faith to an equitable adjustment of the Unit Price to account for such increase in costs. 

        6.2.3    Product Labeling.    The Products supplied to Purchaser will include Purchaser's NDC number and be packaged
in labeling and artwork approved by Purchaser to indicate Purchaser as a distributor of the Product. In order for Purchaser to include in the Product Label Purchaser Trademarks or similar changes
indicating Purchaser as a distributor of the Product; (a) upon Purchaser's request, Seller shall provide Purchaser with the Label artwork and text in electronic format, (b) Purchaser may
update such artwork and text to include Purchaser Trademarks and such other similar changes as desired by Purchaser to indicate Purchaser as a distributor of the Product, and (c) Purchaser's
costs in connection with the foregoing shall be at its sole expense. Thereafter, Seller shall make all necessary arrangements, at its expense (except as provided in Section 6.2.1 above), to
have changed Labels or Labeling printed and shall provide printer's proofs to Purchaser for Purchaser's review. Purchaser shall, within two (2) weeks of receipt of said printer's proofs,
provide written notice to Seller of Purchaser's approval of such proofs in the form submitted by Seller (which approval shall not be unreasonably conditioned, withheld or delayed) or with such
corrections thereto (in Purchaser's reasonable judgment) as included in Purchaser's notice. Thereafter, Seller shall incorporate in such Labels and Labeling Purchaser's requested corrections thereto,
if any, and shall supply Purchaser with examples of such Product Labels and Labeling for Purchaser's regulatory filings; provided, however, that, if
Seller shall not agree with Purchaser's requested corrections, Purchaser and Seller shall consult in good faith to reach a resolution mutually agreeable to Purchaser and Seller. 

15

 

        6.3    Trademarks. All trademarks, tradenames and packaging graphics used by Purchaser in connection with its sale and
distribution of the Product to Purchaser Customers in the Territory (collectively, the "Purchaser Trademarks") shall be chosen by Purchaser in its sole discretion, subject to the terms and conditions
of this Agreement. Purchaser shall be responsible for any and all liabilities which may arise
from Purchaser's use of the Purchaser Trademarks (including any allegations of intellectual property infringement related thereto and any liabilities related to prescription errors related to such
trademark usage). Unless consented to in writing by Seller, Purchaser shall not use any trademark, tradename, company name, or copyright of Seller in connection with the distribution, marketing or
sale of the Product. 

        6.4    Certificate of Analysis. Each shipment of the Product to Purchaser shall be accompanied by a certificate of analysis
prepared by an authorized representative of Seller certifying that the Product in the shipment has been tested in accordance with the ANDA for such Product, meets the Specifications and was
manufactured in material compliance with cGMP (for the avoidance of doubt any non-compliance that would affect Purchaser's sale or distribution of the Product hereunder shall be considered
material). Seller shall deliver such certificate of analysis by facsimile or overnight delivery to Purchaser's distribution facility as designated by Purchaser. 

        6.5    Expiry Dating. Except as otherwise agreed to in writing by Purchaser, all Product shipped to Purchaser, on the date of
shipment by Seller, shall have a shelf-life of at least the approved dating of the Product (per the Product's ANDA) [***]. 

        6.6    Stability Testing. Seller shall maintain a stability testing program for the Product and provide Purchaser with an annual
product review thereon. At least one batch per year of Product shall be included in the stability program. 

        6.7    Annual Report. At Seller's written request, Purchaser will supply distribution information and other information
reasonably requested by Seller, for the purposes of inclusion into Seller's Annual Report to FDA. 

[***]
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respect to the omitted portions. 

16

   ARTICLE 7

TERM  

        7.1    Term. Subject to Article 8, the term of this Agreement shall commence on the Effective Date and remain in effect
for a period of 7 years from the date of Purchaser's First Commercial Sale. Notwithstanding the foregoing, Purchaser shall have the option to renew this Agreement for an additional term of
3 years from the date of the expiration of the initial term by providing Seller Purchaser's irrevocable written notice thereof 12 months prior to the end of the initial term. 

ARTICLE 8

TERMINATION  

        8.1    Breach. This Agreement may be terminated, prior to the expiration of its term, by either party by giving written notice
of its intent to terminate and stating the grounds therefor if the other party shall have materially breached or materially failed in the observance or performance of any representation, warranty,
guarantee, covenant or obligation under this Agreement. The party receiving the default notice shall have 30 days from the date of receipt thereof to cure the breach or failure, except in the
case of a breach of an obligation to pay money, in which case such cure period shall be 10 days; provided, however, that nonpayment in connection
with a good faith dispute of the amount in dispute shall not be considered a breach hereof so long as once such dispute is resolved, payment of any amounts owing is made within 5 days of such
resolution. If a breach (other than a breach of an obligation to pay money) is not curable within such 30 day period, then the non-performing party shall have an additional
30 days within which to cure such breach so long as the non-performing party is diligently working towards a remedy for such breach. In the event such breach or failure is cured in
accordance with the provisions of this Section 8.1, the default notice shall become of no effect. In the event such breach or failure is not cured in accordance with the provisions of this
Section 8.1, then this Agreement shall terminate immediately upon written notice to the defaulting party. 

        8.2    Insolvency, Etc. This Agreement may be terminated, prior to the expiration of its term, immediately upon written notice
by either party: (a) in the event that the other party hereto shall (i) apply for or consent to the appointment of, or the taking of possession by, a receiver, custodian, trustee or
liquidator of itself or of all or a substantial part of its property, (ii) make a general assignment for the benefit of its creditors, (iii) commence a voluntary case under the United
States Bankruptcy Code, as now or hereafter in effect (the "Bankruptcy Code"), (iv) file a petition seeking to take advantage of any law relating to bankruptcy, insolvency,
reorganization, winding-up, or composition or readjustment of debts, (v) fail to controvert in a timely and appropriate manner, or acquiesce in writing to, any petition filed
against it in any involuntary case under the Bankruptcy Code, or (vi) take any corporate action for the purpose of effecting any of the foregoing; or (b) if a proceeding or case shall be
commenced against the other party hereto in any court of competent jurisdiction, seeking (i) its liquidation, reorganization, dissolution or winding-up, or the composition or
readjustment of its debts, (ii) the appointment of a trustee, receiver, custodian, liquidator or the like of the party or of all or any substantial part of its assets, or (iii) similar
relief under any law relating to bankruptcy, insolvency, reorganization winding-up or composition or readjustment of debts, or an order, judgment or decree approving any of the foregoing
shall be entered and continue unstayed for a period of 60 days; or an order for relief against the other party hereto shall be entered in an involuntary case under the Bankruptcy Code. 

        8.3    Termination Relating to Commercial Launch; Force Majeure, No Increase in Unit Price.

        8.3.1    This Agreement shall terminate in accordance with Section 2.3.2. 

        8.3.2    Purchaser or Seller, as the case may be, may terminate this Agreement as provided for under Section 2.4. 

17

 

        8.3.3    Purchaser or Seller, as the case may be, may terminate this Agreement as provided for under Article 12. 

        8.3.4    Seller may terminate this Agreement as provided in Section 4.1.2. 

        8.4    Termination Due to Changed Circumstances. On and after Purchaser's First Commercial Sale, Purchaser or Seller may
terminate this Agreement upon 90 days prior written notice to the other party if Purchaser purchases less than the Minimum Annual Product Units during any rolling twelve month period beginning
after the First Commercial Sale so long as such termination notice is provided to the non-terminating party within 90 days of the end of the twelve month period to which the
termination is based. Notwithstanding the foregoing (unless Purchaser has not ordered at least the Minimum Annual Product Units), Seller's right to terminate this Agreement pursuant to this
Section 8.4 is conditioned upon Seller fulfilling all of Purchaser's Purchase Orders for Product on a timely basis during the twelve month period upon which Seller's exercise of its termination
rights under this
Section 8.4 is based. As used herein, the term "Minimum Annual Product Units" shall mean [***] units of Product during any twelve month period beginning after the First
Commercial Sale there are no Authorized Generic Product or Competitive Product being sold and distributed in the Territory and [***] units of Product during any twelve month
period beginning after the First Commercial Sale in which there are one or more Authorized Generic Products or Competitive Products being sold and distributed in the Territory (which adjustment shall
be effective upon the date of market entry of such Authorized Generic Product or Competitive Product); provided that, in the event of any adjustment to Minimum Annual Product Units during any rolling
twelve month period, the Minimum Annual Product Units existing immediately prior to and after such adjustment shall be prorated as of the effective date of such adjustment for the purpose of
calculating the Minimum Annual Product Units for such twelve month period. 

        8.5    Termination Due to Third Party Infringement Claim. On and after Purchaser's First Commercial Sale, Purchaser may
terminate this Agreement upon 30 days prior written notice to Seller in the event a Third Party Infringement Claim (other than with respect to the use of Purchaser Trademark) is made against
Purchaser or its Affiliates so long as such termination notice is provided to Seller within 15 days of Purchaser receiving written notice of such Third Party Infringement Claim. 

        8.6    Supply Obligations Upon Termination. Upon expiration of this Agreement or any termination of this Agreement after
Purchaser's First Commercial Sale, Seller shall supply and ship, and Purchaser shall purchase from Seller in accordance with the terms and conditions of this Agreement and shall be entitled to
distribute to Purchaser Customers in the Territory, any and all amounts of Products ordered by Purchaser pursuant to Section 5.3 hereof prior to the effective date of such expiration or
termination. 

        8.7    Effect of Termination. Expiration or termination of this Agreement for any reason shall not release either party hereto
from any liability that at such time had already accrued, or that thereafter accrues from a breach or default, prior to the effective date of such expiration or termination, nor affect in any way the
survival of any other right, duty or obligation of either party hereto which is expressly stated elsewhere in this Agreement to survive such expiration or termination. In addition, termination or
expiration of this Agreement shall in no event release Purchaser from its payment obligations under Article 4, including Purchaser's obligation to pay Seller the Gross Profit Split with respect
to sales of Product whether or not such Product is sold before or after the date of such termination or expiration. Except as expressly provided in Section 3.2.2, no payments to Seller made
pursuant to Article 3 shall be refundable in whole or in part, whether upon termination or expiration of this Agreement or otherwise. Except as otherwise provided herein, either party may
pursue any remedy available in law or in equity with respect to any breach of this Agreement. Sections 2.2.3, 2.3.4 (but only in the event of a termination pursuant to Section 2.3.2), 2.3.5
(but only in the event of a termination pursuant to Section 2.3.2), 2.3.6, 3.2.2, 4.5, 6.7, 8.6, 8.7, Article 13, Article 14, Article 16, 

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

18

 

Article 17
and, as applicable, Article 11 and Article 18 hereof shall survive the expiration or termination of this Agreement in accordance with the respective terms thereof. 

ARTICLE 9

WAREHOUSING; SHIPMENT  

        9.1    Delivery. Seller shall not be responsible for warehousing finished goods for Purchaser. Purchaser is responsible for any
delivery charges FCA (Incoterms 2000), Seller's designated manufacturing site. All shipments shall be accompanied by a packing slip that describes the articles, states the Purchase Order number and
shows the shipment's destination. Seller shall use Commercially Reasonable Efforts to deliver Product in accordance with the delivery schedule set forth in the Initial Purchase Order or the Purchase
Orders provided in compliance with Section 5.3 hereof. 

        9.2    Shipment. The risk of loss with respect to Product shall be in accordance with FCA (Incoterms 2000), Seller's designated
manufacturing site. Purchaser shall notify Seller within 24 hours of discovery of any lost or stolen goods to facilitate Seller's notification of the FDA. 

ARTICLE 10

DEFECTIVE PRODUCT/INSPECTIONS/TESTING  

        10.1    Disposition of Defective Product. Purchaser shall use Commercially Reasonable Efforts, within 20 days after
receipt of any shipment of Product, to notify Seller in writing of the existence and nature of any non-compliance with the Product Warranty observable from a visual inspection. If such
notice is not provided within such 20 day period, then all such Product shall be deemed to be accepted by Purchaser; provided, however, that, any such acceptance or deemed acceptance shall not
adversely affect any applicable Product Warranty or rights to indemnification. If Purchaser notifies Seller of defective Product, then Seller shall have a reasonable opportunity to inspect such
defective Product and provide Purchaser with detailed written instructions to return or dispose of such defective Product at Seller's expense. Whether or not Seller agrees with Purchaser's basis of
rejection, Seller shall, at Purchaser's request, use Commercially Reasonable Efforts to promptly replace the rejected Product. Purchaser shall pay the Transfer Price, and, to the extent Purchaser's
Net Sales derive from
the sale of such Product, the applicable Gross Profit Split, for any Product shipped by Seller that replaces Product rejected by Purchaser hereunder. In accordance with Section 10.2 below,
Purchaser shall not be obligated to pay for any properly rejected Product and any such payment shall be promptly returned to Purchaser if Seller agrees with Purchaser's notice of
non-compliance with respect to such rejected Product or such rejected Product is deemed by the independent third-party laboratory to be not in compliance with the Product Warranty.
Purchaser shall not destroy, return or otherwise dispose of the rejected Product until written notification is received from Seller. 

        10.2    Independent Testing. If Seller disagrees with Purchaser's notice of non-compliance as to Product testing
Specifications of the Product to the Product Warranty, the Product shall be submitted to an independent third-party laboratory, mutually and reasonably acceptable to both parties, for analytical
testing to determine the extent of the Product's compliance or non-compliance to the Product Warranty. All costs associated with such third-party laboratory testing shall be at Purchaser's
expense, and Purchaser shall be required to pay the Transfer Price and, in the event Purchaser's Net Sales derive from the sale of such Product, the applicable Gross Profit Split, for all rejected
Product (irrespective of whether Seller has replaced such Product), unless Seller agrees with Purchaser's notice of non-compliance or the tested Product is deemed by such third-party
laboratory to be not in compliance with the Product Warranty, in which case all such costs associated with such third-party laboratory testing, including reimbursement of freight and disposition
costs, shall be promptly reimbursed by Seller to Purchaser and Purchaser shall not be obligated to pay for such rejected Product and any such payment shall be promptly returned to Purchaser. 

19

 

        10.3    Short-Shipment. Purchaser shall notify Seller within 30 days of receipt of any short-shipment claim with respect
to the Product and Seller shall use Commercially Reasonable Efforts to promptly address such claim to Purchaser's reasonable satisfaction. 

ARTICLE 11

REGULATORY MATTERS  

        11.1    Adverse Event Reporting; Product Complaints. Purchaser shall have the responsibility in the Territory for complying with
all regulatory filings, reporting requirements and other matters which relate solely to Purchaser acting as a distributor of the Product to Purchaser Customers in the Territory and Seller shall
cooperate with Purchaser as reasonably necessary to accomplish the foregoing. All other regulatory reporting matters (including investigating, evaluating and reporting Adverse Events and other Product
complaints) shall be Seller's responsibility. In this regard, Seller shall be responsible for all reporting to regulatory authorities of all Adverse Events associated with the use of Product.
Purchaser shall notify Seller of any report of an Adverse Event concerning the Product within five
(5) calendar days of receipt of the report and provide Seller with information as required by Applicable Laws or as reasonably requested by Seller. Purchaser shall cooperate with Seller as
necessary to report such Adverse Event when so required under Applicable Laws. Purchaser shall also notify Seller within 10 days of any complaints related to the Product of which it becomes
aware regarding problems with the Product other than those associated with Adverse Events, and Seller shall meet and confer periodically with Purchaser with respect to Seller's responses to such
complaints and whether any remedial actions by Purchaser are indicated as necessary or appropriate by the pattern of complaints, which actions shall be at the expense of the party to the extent its
improper acts or omissions caused such complaints. 

        11.2    FDA Communications. Purchaser and Seller agree to promptly notify the other party in the event they receive any
communication or notice from the FDA with respect to the Product or an inspection of the facility where the Product is manufactured, Packaged or stored, and each party shall promptly provide a copy of
such communications to the extent applicable to the Product to the other. The parties shall cooperate in good faith in responding to any such FDA inquiry or in making any report to the FDA with
respect to the Product, but in all cases Seller shall have final authority for regulatory decisions concerning the Product and responsibility for all communications with the FDA. 

        11.3    Recalls.

        11.3.1    In the event of any recall or seizure of any Product, other than a Purchaser Recall (as defined below) Seller shall,
at the written election of Purchaser and at Seller's sole cost, either: 

        (a)    undertake Commercially Reasonable Efforts to replace the amount of Product recalled or seized; or 

        (b)    give credit to Purchaser against outstanding receivables due from Purchaser in an amount equal to the amount paid by
Purchaser for the Product (including any Gross Profit Split paid to Seller on such Product) so recalled or seized or otherwise owing by Purchaser hereunder; 

plus
reimburse (or, at the written election of Purchaser, credit) Purchaser for the aggregate and reasonable transportation costs, taxes, freight insurance, handling and reasonable and verifiable
out-of-pocket costs incurred by Purchaser in respect of such recalled or seized Product. 

        11.3.2    In the event of any recall or seizure of any Product occurring primarily as a result of any breach of this Agreement
by, or negligent acts of omissions or intentional misconduct of, Purchaser or its Affiliates (a "Purchaser Recall"), (i) if such Purchaser Recall is classified by FDA as a Class I
recall, Seller shall be responsible (as between Purchaser and Seller) for such recalled or seized Product and shall bear all costs of such recall or seizure, (ii) if such Purchaser Recall is 

20

 

classified
by FDA as a Class II recall, Seller shall be responsible (as between Purchaser and Seller) for such recalled or seized Product and the parties shall share equally all costs of such
recall or seizure and (iii) if such Purchaser Recall is classified by FDA as a Class III recall, Purchaser shall be responsible (as between Purchaser and Seller) for such recalled or
seized Product and shall bear all costs of such recall or seizure, including reimbursement of Seller of any reasonable and verifiable out-of-pocket costs incurred by Seller
related to the recall or seizure of such Product. Purchaser's costs with respect to any Purchaser Recall as set forth above shall not be deducted in connection with the calculation of Purchaser's Net
Sales or Gross Profit hereunder. 

        11.3.3    For purposes of this Section 11.3, "recall" shall mean (i) any action by Seller, Purchaser, any
Affiliate of either to recover title to or possession of any Product sold or shipped and/or (ii) any decision by Purchaser not to sell or ship Product to third parties which would have been
subject to recall or seizure if it had been sold or shipped, in each case taken in the good faith belief that such action was appropriate or required under the circumstances. For purposes of this
Section 11.3, "seizure" shall mean any action by any government agency to detain or destroy any Product. Notwithstanding anything to the contrary in this Section 11.3, Seller shall have
final authority with respect to any recall of the Product and neither Purchaser nor its Affiliates shall initiate any recall of the Product without Seller's prior written approval (such approval not
to be unreasonably conditioned, withheld or delayed). 

        11.3.4    Seller and Purchaser shall keep the other fully informed of any notification or other information, whether received
directly or indirectly, that might affect the marketability, safety or effectiveness of the Product, or which might result in liability issues or otherwise necessitate action on the part of either
party, or which might result in recall or seizure of any Product. Purchaser shall maintain records of all sales of Product and customers reasonably sufficient to adequately administer a recall or
seizure for the longer of three years after termination or expiration of this Agreement or the period required by Applicable Law. Seller will be responsible for assuring that such recall is
closed-out with the FDA, unless the FDA shall otherwise require. 

        11.4    Inspections. 

        11.4.1    Seller shall use Commercially Reasonable Efforts to maintain and operate the manufacturing facility designated in the
ANDA, and to implement such quality control procedures, so as to cause Seller to be able to perform its obligations hereunder. Upon Purchaser's written request and at its expense, Seller shall permit
quality assurance representatives of Purchaser (reasonably acceptable to Seller) to inspect such manufacturing facility, at all times accompanied by a representative of Seller, upon reasonable notice,
during normal business hours and on a confidential basis. Such inspection shall
be limited to an assessment of such facility's compliance with cGMP and other quality assurance standards as such relate to the manufacture of the Product. Seller shall also permit Purchaser
reasonable periodic visits to discuss and review manufacturing and supply issues with management of Seller. 

        11.4.2    In the event Seller's manufacturing, Packaging, testing or storage facility producing the Product hereunder is
inspected by representatives of any federal, state, or local agency in connection with Seller's manufacture, Packaging, testing or storage of Product, then Seller shall notify the Purchaser promptly
upon learning of such inspection, and shall, within 10 days of such notice, supply Purchaser with copies of any correspondence or portions of correspondence which relate to the Product in
Seller's possession. If Seller is informed that a representative of any federal, state, or local agency will be conducting an audit of Seller's manufacturing facility and such audit specifically
relates to the Product, then Seller will, to the extent reasonably practicable, provide advance notice to Purchaser to permit Purchaser to observe and attend such audit. In the event Seller receives
any regulatory letter or comments from any federal, state, or local agency in connection with its manufacture, Packaging, testing or storage of the Product requiring a response 

21

 

or
action by Seller, including receipt of a Form 483 (Inspectional Observations) or a "Warning Letter," Seller shall promptly following Seller's receipt thereof, provide Purchaser with a copy
of such communication which relate to the Product. At Seller's request, Purchaser will provide Seller with any and all data or information reasonably required to prepare a response to such
communication. Seller shall consult Purchaser with respect to any response relating to the Product; provided, however, that, as between Seller and Purchaser, Seller shall make the final determination
as to any such response submitted to the regulatory authorities. Seller shall promptly provide Purchaser with a copy of any final response which relate to the Product after its submission to the
regulatory authority. 

        11.4.3    Purchaser shall use Commercially Reasonable Efforts to maintain and operate any facility of Purchaser at which the
Product is stored or distributed in compliance with cGMP and other quality assurance standards as such relate to the Product. Upon Seller's written request and at its expense, Purchaser shall permit
quality assurance representatives of Seller (reasonably acceptable to Purchaser) to inspect any facility of Purchaser at which the Product is stored or distributed. Such inspection shall be limited to
an assessment of such facility's compliance with cGMP and other quality assurance standards as such relate to the Product. In the event Purchaser is inspected or receives a regulatory letter or
comments from any federal agency in connection with its sale or distribution of the Product, Purchaser shall notify Seller promptly upon learning of such inspection and/or provide Seller copies of
such correspondence upon receiving such documentation. Seller shall have the right to, and at Purchaser's written request shall, participate in that portion of such inspection relating to the Product.
Regardless of whether Seller does participate as described above, Seller and Purchaser shall consult with respect to the response relating to the Product. Seller will provide Purchaser at Purchaser's
request with all data or information reasonably required to prepare a response relating to the Product, and Purchaser will promptly provide Seller with a copy of any final response submitted to the
regulatory authority. 

        11.4.4    Seller will notify Purchaser within one day of any finished Product lot that results in a positive sterility test out
of specification (OOS) condition, whether or not that lot was released or distributed, whether or not the positive sterility result was subsequently investigated and attributed to an assignable cause.
In addition, Seller will notify Purchaser within one day of any stability test for the Product that results in an OOS condition relating to the Product Specifications, whether or not the OOS condition
was subsequently investigated and attributed to an assignable cause. To the extent it is not reasonably practicable for Seller to provide notice within the one day period required by this Section,
Seller will not be deemed to be in breach of this Agreement if it provides the required notice as soon as it is reasonably practicable. Seller will also provide quarterly reports to Purchaser of the
number of lots of Product made and the number of lot failures during the preceding quarter and shall reasonably respond to any information requests relating thereto. 

        11.5    Sales and Marketing Activities. Purchaser shall be responsible for establishing a formal written program in compliance
with the California Comprehensive Compliance Program pursuant to California Health and Safety Code Sections 119400 et. seq., on or before July 1, 2005, for all applicable activities of
Purchaser and its Affiliates related to the Product which are subject to this code section. Upon request of Seller, Purchaser shall provide Seller with reasonable evidence of its compliance with this
Section 11.5. 

        11.6    Cooperation. Seller shall provide reasonable assistance to Purchaser in its preparation and filing with appropriate
regulatory agencies (both federal and state agencies related to reimbursement and health care insurance) of filings required for the marketing, and distribution of the Product to Purchaser Customers
in the Territory by Purchaser. Seller and Purchaser shall cooperate in good faith to develop such necessary regulatory strategies which may be required for purposes of this Agreement, and to allow the
Product to be listed on applicable formularies and other drug listings as reasonably 

22

 

requested
by Purchaser, and making any applicable filings or registrations to allow the Product to be included on such formularies or listings, including Medicare and Medicaid. 

ARTICLE 12

FORCE MAJEURE  

        12.1    Force Majeure. If either party is prevented from performing any of its obligations hereunder (except for any monetary
payments due hereunder) due directly or indirectly to fire; flood; accident; explosion; equipment or machinery breakdown; sabotage; strike; or any labor disturbance; civil commotions; riots'
invasions; wars (present or future); acts, restraints, requisitions, regulations, or directions or orders of any governmental entity; compliance with any request of any governmental entity; compliance
with any request for material represented to be for purposes of (directly or indirectly) producing articles for national defense or national defense facilities; shortage of labor, fuel,
power or raw materials; inability to obtain raw materials or supplies; failures of normal sources of supplies; inability to obtain or delays of transportation facilities; any act of God; any act of
the other party or other causes (whether similar or dissimilar to the foregoing); in each case so long as such cause is beyond the reasonable control of such party (a "Force Majeure Event"), such
non-performing party shall not be liable for breach of this Agreement with respect to such non-performance if and to the extent any such non-performance is due to a
Force Majeure Event. Such non-performance will be excused for as long as such event shall be continuing; provided that, the non-performing party gives immediate written notice
to the other party of the Force Majeure Event. Such non-performing party shall exercise all reasonable efforts to eliminate the Force Majeure Event and to resume performance of its
affected obligations as soon as practicable. In the event that, as a result of such Force Majeure Event, a party does not perform all of its obligations hereunder for any period aggregating
120 days within any 360-day period, the other party may terminate this Agreement on 30 days prior written notice to the non-performing party. 

ARTICLE 13

INSURANCE  

        13.1    Insurance. Each party agrees to procure and maintain in full force and effect during the term of this Agreement and
continuing for a period of not less than 36 months following the termination or expiration hereof, at its sole cost and expense, product liability insurance in amounts of not less than
[***] per incident and [***] annual aggregate (provided that within 60 days after Purchaser's payment of the amount to Seller under
Section 3.1(b), the annual aggregate shall be increased to [***]) which insurance shall be written on a "claims made" basis policy form with a reputable insurance
carrier and name the other party as an additional insured. Each party shall, on request, provide to the other party a copy of a certificate of coverage or other written evidence reasonably
satisfactory to such requesting party of such insurance coverage. Either party may substitute a program of self-insurance for all or part of the third party insurance required hereunder if
reasonably satisfactory to the other party. 

ARTICLE 14

CONFIDENTIALITY  

        14.1    Confidentiality. As used herein, "Confidential Information" shall include all confidential or proprietary information
given to one party by the other party, or otherwise acquired by such party in its performance of this Agreement, relating to such other party or any of its Affiliates, including information regarding
any of the products of such other party or any of its Affiliates, information regarding its advertising, distribution, marketing or strategic plans or information regarding its costs, productivity or
technological advances, specifications, data, know-how, formulations,
product concepts, sample materials, manufacturing processes and other manufacturing information, business and technical 

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

23

 

information,
pricing and other deal terms, whether in written form or disclosed orally, visually and/or in another tangible form. Neither party shall use, exploit or disclose to third parties any
Confidential Information of the other and each party shall insure that its and its Affiliates' employees, officers, representatives and agents shall not use or disclose to third parties any
Confidential Information and upon the termination of this Agreement shall return to the other or destroy all Confidential Information in written form. Confidential Information shall not include
information that (i) was lawfully already known to receiving party at the time of its receipt thereof, (ii) is disclosed to receiving party after its receipt thereof by a third party who
has a right to make such disclosure without violating any obligation of confidentiality, (iii) is or becomes generally available to the public through no fault of receiving party or
(iv) is independently developed by the receiving party as demonstrated by such party pursuant to contemporaneous written records. The obligations of confidentiality set out above shall survive
termination or expiration of this Agreement for a period of 10 years. Notwithstanding the foregoing, in the event that a party is required under Applicable Law, the rules or regulations of any
stock exchange or listing body upon which the stock of a party or a party's parent corporation may then be traded, or by governmental agency or court of competent jurisdiction to disclose the
Confidential Information of the other party, such party shall promptly notify the other party in writing of all details of the required disclosure and permit the other party a reasonable opportunity
to intervene to oppose, limit or condition such disclosure prior to making such disclosure, and such party shall make any such disclosure ultimately required in the most restrictive fashion, in its
reasonable judgment, consistent with the applicable requirement requiring such disclosure. 

ARTICLE 15

PUBLIC ANNOUNCEMENTS; ETC.  

        15.1    Public Announcements. No public announcement, news release, statement, publication, or presentation relating to the
existence of this Agreement, the subject matter hereof, or either party's performance hereunder will be made without the other party's prior written approval, which approval
shall not be unreasonably conditioned, withheld or delayed. Notwithstanding the foregoing, and subject to the provisions of Article 14 with respect to Confidential Information, either party may
make any public disclosure relating to the existence of this Agreement, the subject matter hereof and its terms, or either party's performance hereunder that is deemed necessary, in the reasonable
judgment of a party, to comply with Applicable Laws or with the rules or regulations of any stock exchange or listing body upon which the securities of a party or a party's parent corporation may then
or are intended to be traded or of any governmental agency (e.g., the Securities and Exchange Commission) which regulates such securities (including the filing of a copy of this Agreement with such
governmental agency); provided that, the party making such disclosure shall provide the non-disclosing party with a copy of the intended disclosure reasonably, and to the extent
practicable, prior to public dissemination. 

        15.2    No Use of Other Party's Name. Neither party shall use the name of the other party or any of its Affiliates for
advertising, promotional or other purposes without the prior written consent of the other party. 

ARTICLE 16

REPRESENTATIONS AND WARRANTIES  

        16.1    Product Warranty.

        16.1.1    Seller represents and warrants to Purchaser that all Product supplied in connection with this Agreement shall:
(i) be manufactured, packaged, tested, stored and handled in compliance in all material respects with cGMP and all other Applicable Laws (for the avoidance of doubt any
non-compliance that would affect Purchaser's sale or distribution of the Product hereunder shall be considered material); and (ii) meet the Specifications and the Product's ANDA and
not be adulterated or misbranded within the meaning of the Act (each of clauses (i) and 

24

 

(ii) being
referred to collectively herein as the "Product Warranty"). The foregoing Product Warranty shall not apply to the extent that the failure of any such Product to meet the requirements
of this Section 16.1.1 is caused by the negligent acts or omissions or intentional misconduct of Purchaser, its Affiliates, wholesalers or other customers (including modification or misuse or
improper storage or transportation of the Product after shipment to Purchaser, whether by Purchaser, its Affiliates or any other Person). 

        16.1.2    EXCEPT AS EXPRESSLY PROVIDED IN SECTION 16.1.1 ABOVE, SELLER MAKES NO REPRESENTATION OR WARRANTY WITH RESPECT TO THE
PRODUCT OF ANY KIND,
EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY AS TO MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OR ANY WARRANTY THAT THE PRODUCT IS FREE FROM THE RIGHTFUL CLAIM OF ANY THIRD PARTY, BY WAY OF
INFRINGEMENT OR THE LIKE. 

        16.2    Warranties with Regard to Status.

        16.2.1    Purchaser hereby represents and warrants to Seller that neither it nor any of its Affiliates is prohibited under any
Applicable Laws from selling and distributing the Product (assuming that the ANDA for the Product is approved by FDA) within the Territory and that neither Purchaser nor any of its Affiliates is a
person that is listed by a United States federal agency as debarred, suspended, proposed for debarment or otherwise ineligible for federal programs in the Territory. 

        16.2.2    Seller hereby represents and warrants to Purchaser that neither it nor any of its Affiliates is prohibited under any
Applicable Laws from manufacturing, selling and distributing the Product (assuming that the ANDA for the Product is approved by FDA) within the Territory and that neither Seller nor any of its
Affiliates is a person that is listed by a United States federal agency as debarred, suspended, proposed for debarment or otherwise ineligible for federal programs in the Territory. 

        16.3    Purchaser Warranties. Purchaser hereby represents warrants and covenants that: 

        (a)    Purchaser Trademarks may be lawfully used as directed by Purchaser; 

        (b)    the Product Label, if Labeled in accordance with specifications provided by Purchaser, will comply with the ANDA for the
Product and Applicable Laws; and, 

        (c)    neither Purchaser nor its Affiliates has filed with the FDA an ANDA for a generic equivalent to Lovenox®. 

        16.4    Execution and Performance of Agreement. Each of Seller and Purchaser represents and warrants to the other that it has
full right, power and authority to enter into and perform its obligations under this Agreement. Each of Seller and Purchaser further represents and warrants to the other that the performance of its
obligations under this Agreement will not result in a violation or breach of, and will not conflict with or constitute a default under any agreement, contract, commitment or obligation to which such
party or any of its Affiliates is a party or by which it is otherwise bound or any Applicable Law. 

        16.5    LIMITATION ON LIABILITY OF PARTIES. EXCEPT WITH RESPECT TO (A) A CLAIM FOR BREACH UNDER ARTICLE 14 ABOVE,
(B) A CLAIM FOR WILLFUL MISCONDUCT OR FRAUD AND (C) AMOUNTS PAYABLE TO A THIRD PARTY THAT ARE SUBJECT TO INDEMNIFICATION PURSUANT TO ARTICLE 17 BELOW, IN NO EVENT SHALL EITHER PARTY BE
LIABLE TO THE OTHER PARTY FOR LOSS OF PROFITS OR INDIRECT, INCIDENTAL, SPECIAL, CONSEQUENTIAL OR PUNITIVE DAMAGES RESULTING FROM THIS AGREEMENT. 

25

 
ARTICLE 17

INDEMNIFICATION  

        17.1    Indemnification by Seller. Seller shall indemnify, defend and hold harmless Purchaser (and its Affiliates) from and
against any and all damages, liabilities, claims, costs, charges, judgments and expenses (including reasonable attorneys' fees) (collectively "Damages") that may be sustained, suffered or incurred by
Purchaser (or its Affiliates) arising from or relating to any claim, action or proceeding made or brought by a third party against the Purchaser (or its Affiliates) to the extent arising from
(a) the actual or alleged breach by Seller of any warranty, representation, covenant or agreement made by Seller in this Agreement; (b) negligent acts or omissions or intentional
misconduct of Seller or its Affiliates; (c) any Product recall or seizure (other than a Purchaser Recall to the extent provided under Section 11.3.2); or (d) any Product Liability
Claims (other than as provided in Section 17.2(d) below); provided, however, that in each such case above, Seller shall not be liable to Purchaser hereunder to the extent such Damages arise
from the negligent acts or omissions or intentional misconduct of Purchaser or its Affiliates, wholesalers or other customers (including modification or misuse or improper storage or transportation of
the Product after shipment to Purchaser, whether by Purchaser, its Affiliates or any other Person) or such other actions or inactions for which Purchaser is obligated to indemnify Seller under
Section 17.2 below. 

        17.2    Indemnification by Purchaser. Purchaser shall indemnify, defend and hold harmless Seller (and its Affiliates) from and
against any and all Damages, that may be sustained, suffered or incurred by Seller (or its Affiliates) arising from or relating to any claim, action or proceeding made or brought by a third party
against the Seller (or its Affiliates) to the extent arising from (a) the actual or alleged breach by Purchaser of any warranty, representation, covenant or agreement made by Purchaser in this
Agreement; (b) improper Product marketing, sales or distribution activities of Purchaser or its Affiliates, including any commercial arrangements entered into by Purchaser with its customers or
other third parties; (c) negligent acts or omissions or intentional misconduct of Purchaser or its Affiliates (including modification or misuse or improper storage or transportation of the
Product by Purchaser, its Affiliates or other Person acting on behalf of Purchaser or its Affiliates, excluding wholesalers and customers); (d) any Product Liability Claims to the extent
arising from Purchaser's breach hereof or the negligent acts or omissions or intentional misconduct of Purchaser and its Affiliates (including modification or
misuse or improper storage or transportation of the Product by Purchaser, its Affiliates or other Person acting on behalf of Purchaser or its Affiliates, excluding wholesalers and customers); or
(e) any Purchaser Recall (except as otherwise provided in Section 11.3.2); provided, however, that, in each such case above, Purchaser shall not be liable to Seller hereunder to the
extent such Damages arise from the negligent acts or omissions or intentional misconduct of Seller or its Affiliates or such other actions or inactions for which Seller is obligated to indemnify
Purchaser under Section 17.1 above. 

        17.3    Claims. Each indemnified party agrees to give the indemnifying party prompt written notice of any matter upon which such
indemnified party intends to base a claim for indemnification under this Article 17; provided, however, that failure to give such prompt notification shall not affect the indemnification
provided hereunder except to the extent the indemnifying party shall have been actually materially prejudiced as a result of such failure. The indemnified party shall permit, and shall cause its
employees and agents to permit, the indemnifying party to defend or settle any such action, claim or liability and agrees to the complete control of such defense or settlement by the indemnifying
party; provided, however, that such settlement does not impose any obligation or burden on the indemnified party without the prior written consent of the indemnified party. No such action, claim or
liability shall be settled by the indemnified party without the prior written consent of the indemnifying party (which consent shall not be unreasonably conditioned, withheld or delayed) and the
indemnifying party shall not be responsible for any fees or other costs incurred other than as provided in this Article 17. The indemnified party, its employees, agents and affiliates shall
cooperate reasonably with the indemnifying 

26

 

party
and its legal representatives in the investigation and defense of any action, claim or liability covered by this indemnification at the sole expense of the indemnifying party. The indemnified
party shall have the right, but not the obligation, to be represented by counsel of its own selection and at its own expense. Notwithstanding Sections 17.1 and 17.2 above, and by way of clarification,
neither party shall be obligated to indemnify the other party hereunder for modification or misuse or improper storage or transportation of the Product by wholesalers or the customers of either party. 

        17.4    Third Party Infringement Claims. In the event any claim or action for infringement of any patent, trademark, or other
intellectual property right shall be made or brought by a third party against Seller, Purchaser or any of their respective Affiliates because of, or in anticipation of, the manufacture and supply of
Product by Seller to Purchaser hereunder, or the marketing, sale or distribution of such Product to Purchaser Customers in the Territory by Purchaser hereunder (a "Third Party Infringement Claim"),
the party first receiving such notice of the Third Party Infringement Claim shall promptly notify the other party. With respect to the Third Party Infringement Claim, Seller and Purchaser each hereby
agrees that all Damages arising from or related to the Third Party Infringement Claim (including any legal fees and associated costs incurred in defending the Third Party Infringement Claim and any
fees, royalties or other amounts paid in settlement or upon judgment) shall be shared as follows: 

        (a)    Except as provided in clause (b) below, [***] shall be [***]
responsible for [***] arising from any
Third Party Infringement Claim, including any fees, royalties or other amounts agreed to be paid in settlement or upon judgment of the Lawsuit or otherwise; and 

        (b)    [***] shall be [***] for [***] arising from any
Third Party Infringement Claim with respect to the use of Purchaser Trademarks. 

Each
party agrees to indemnify the other party to ensure that Damages arising from any Third Party Infringement Claim are allocated in accordance with clauses (a) and (b) above. Unless
otherwise agreed to by the parties, Seller shall control the defense any Third Party Infringement Claim described in clause (a) above and Purchaser shall control the defense of any Third Party
Infringement Claim described in clause (b) above. The party controlling the defense of any Third Party Infringement Claim shall have the sole right to defend or settle any such Third Party
Infringement Claim; provided, however, that such settlement does not impose any obligation or burden on the other party without the prior written consent of the other party (which consent shall not be
unreasonably withheld). The party controlling the defense of any Third Party Infringement Claim shall keep the other party, at its request, materially informed of the status and progress of the
defense of the Third Party Infringement Claim. No Third Party Infringement Claim shall be settled by the party who is not controlling the defense of such Third Party Infringement Claim without the
prior written consent of the party controlling such defense. The non-controlling party, its employees, agents and Affiliates shall reasonably cooperate with the party (and its legal
representatives) controlling the defense of any Third Party Infringement Claim in the investigation and defense of such Third Party Infringement Claim. Notwithstanding the above, and by way of
clarification, neither party shall be obligated to indemnify the other party hereunder for modification or misuse of the Product by the other party or by wholesalers or the customers of either party.
The provisions of this Section 17.4 shall be notwithstanding any conflicting provisions set forth in this Agreement, including Sections 17.1, 17.2 and 17.3. 

        17.5    No Right of Offset. Purchaser shall have no right to set off or retain any amounts otherwise payable to Seller under
Articles 3 or 4 of this Agreement, including any amounts payable to satisfy any indemnification claims Purchaser may have hereunder. 

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

27

 
ARTICLE 18

MISCELLANEOUS  

        18.1    Governing Law. This Agreement and all acts and transactions pursuant hereto and the rights and obligations of the
parties hereto shall be governed, construed and interpreted in accordance with the laws of the State of New York, without reference to rules of conflicts or choice of laws. 

        18.2    Relationship of the Parties. The relationship of Purchaser and Seller established by this Agreement is that of
independent contractors, and nothing contained herein shall be construed to (i) give either party any right or authority to create or assume any obligation of any kind on behalf of the other or
(ii) constitute the parties as partners, joint venturers, co-owners or otherwise as participants in a joint or common undertaking. 

        18.3    Third Party Rights. Nothing in this Agreement shall be deemed to create any third party beneficiary rights in or on
behalf of any other person. 

        18.4    Entire Agreement. It is the mutual desire and intent of the parties to provide certainty as to their respective future
rights and remedies against each other by defining the extent of their mutual undertakings as provided herein. The parties have in this Agreement incorporated all representations, warranties,
covenants, commitments and understandings on which they have relied in entering into this Agreement, and, except as provided for herein, neither party makes any covenant or other commitment to the
other concerning its future action. Accordingly, this Agreement (i) constitutes the entire agreement and understanding between the parties with respect to the subject matter hereof and there
are no promises, representations, conditions, provisions or terms related thereto other than those set forth in this Agreement and (ii) supersedes all previous understandings, agreements and
representations between the parties, written or oral. No modification, change or amendment to this Agreement shall be effective unless in writing signed by each of the parties hereto. 

        18.5    Interpretation. Unless the context of this Agreement otherwise requires, (i) words of any gender include each
other gender; (ii) words using the singular or plural number also include the plural or singular number, respectively; (iii) the terms "hereof," "herein," "hereby," and derivative or
similar words refer to this entire Agreement; (iv) the terms "Article" and "Section" refer to the specified Article and Section of this Agreement, and (v) the terms "include,"
"includes," or "including" shall be deemed to be followed by the words "without limitation" unless otherwise indicated. Whenever this Agreement refers to a number of days, unless otherwise specified,
such number shall refer to calendar days. The headings in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. 

        18.6    Notices. All notices and other communications hereunder shall be in writing. All notices hereunder of an indemnity
claim, a Force Majeure Event, default or breach hereunder, or, if applicable, termination or renewal of the term hereof, or any other notice of any event or development material to this Agreement
taken as a whole, shall be delivered personally, or sent by national overnight delivery service or postage pre-paid registered or certified U.S. mail, or facsimile, and shall be deemed
given: when delivered, if by personal delivery or overnight delivery service; five business days after deposit in the U.S. mail, if mailed; or upon receipt of electronic confirmation of transmission,
if sent by facsimile and followed on the same day by deposit in the U.S. mail. Notice shall be addressed: 

        If
to Seller: 

Amphastar
Pharmaceuticals, Inc.

11570 Sixth Street

Rancho Cucamonga, California 91730

Attention: Chief Financial Officer

Telephone: (909) 980-9484

Fax: (909) 980-8296 

28

 

        If
to Purchaser: 

Andrx
Pharmaceuticals, Inc.

8151 Peters Road, Fourth Floor

Plantation, Florida 33324

Attention Lawrence Rosenthal, President

Telephone: (954) 382-7608

Fax: (954) 382-7716 

        With
a copy (which shall not constitute notice) to: 

Andrx
Corporation

8151 Peters Road, Fourth Floor

Plantation, Florida 33324

Attention: Scott Lodin, Esq.,

                                Executive Vice President and General Counsel

Telephone: (954) 382-7614

Fax: (954) 382-7744 

or
to such other place as either party may designate by written notice to the other in accordance with the terms of this Section 18.6. 

        18.7    No Waiver. The failure of either party to enforce at any time for any period any provision hereof shall not be construed
to be a waiver of such provision or of the right of such party thereafter to enforce each such provision, nor shall any single or partial exercise of any right or remedy hereunder preclude any other
or further exercise thereof or the exercise of any other right or remedy. Subject to any express provisions to the contrary contained herein, the remedies provided herein are cumulative and not
exclusive of any remedies provided at law. 

        18.8    Assignment. This Agreement may not be assigned or delegated by either party without the prior written consent of the
other, except that either party may assign or delegate its rights and/or obligations hereunder to any of its Affiliates, to a successor to all of its business, or to a successor to that portion of its
business which relates to the Product. Subject to the foregoing and the other terms of this Agreement, this Agreement shall bind and inure to the benefit of the parties hereto and their respective
successors and permitted assigns. 

        18.9    Severability. In the event that any one or more of the terms or provisions (or any part thereof) contained in this
Agreement or in any other instrument referred to herein, shall, for any reason, be held to be invalid, illegal or unenforceable in any respect pursuant to a final, non-appealable decision,
then to the maximum extent permitted by law, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Agreement or any other such instrument. Any term or
provision of this Agreement that is so held to be invalid, illegal or unenforceable in any jurisdiction shall, to the extent the economic benefits conferred by this Agreement to both parties remain
substantially unimpaired, not affect the validity, legality or enforceability of any of the terms or provisions of this Agreement in any other jurisdiction. 

        18.10    Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original,
and all of which together shall constitute one and the same instrument. 

        18.11    Expenses. Each party shall pay all of its own fees and expenses (including all legal, accounting and other advisory
fees) incurred in connection with the negotiation and execution of this Agreement and the arrangements contemplated hereby. 

[SIGNATURE PAGE FOLLOWS]

29

 

        IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their duly authorized respective representatives as of the day and year first above written. 

	 	 	AMPHASTAR PHARMACEUTICALS, INC.
	

 	
 	

By:	

/s/  DAVID W. NASSIF      

	

 	
 	

Name:	

David W. Nassif

	

 	
 	

Title:	

CFO and Senior Vice President of Global Licensing

	

 	
 	

ANDRX PHARMACEUTICALS, INC.
	

 	
 	

By:	

/s/  LAWRENCE J. ROSENTHAL      

	

 	
 	

Name:	

Lawrence J. Rosenthal

	

 	
 	

Title:	

President

30

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Exhibit 10.28

DISTRIBUTION AGREEMENTQuickLinks
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Exhibit 4.1  

 

QWEST COMMUNICATIONS INTERNATIONAL INC.

71/2% Notes due 2014, Series B

First Supplemental Indenture

Dated as of June 17, 2005

U.S. BANK NATIONAL ASSOCIATION,

as Trustee with respect to such series of Securities as shall be designated from time to time pursuant to the terms hereof

 

  

 
 

TABLE OF CONTENTS    
    

	 
	 	 
	 	Page

	ARTICLE I.
	

THE 71/2% NOTES DUE FEBRUARY 15, 2014
	

SECTION 1.01.	
 	

Designation of Notes	
 	

1
	SECTION 1.02.	 	Other Terms of the Notes	 	2
	

ARTICLE II.
	

APPOINTMENT OF U.S. BANK NATIONAL ASSOCIATION
	

SECTION 2.01.	
 	

Appointment of U.S. Bank National Association	
 	

2
	SECTION 2.02.	 	Acceptance of Trustee	 	2
	SECTION 2.03.	 	Qualification of Trustee	 	2
	SECTION 2.04.	 	Notice	 	2
	

ARTICLE III.
	

AMENDMENTS TO THE INDENTURE
	

SECTION 3.01.	
 	

Amendments to the Indenture	
 	

3
	SECTION 3.02.	 	Appointment of Co-Trustee or Separate Trustee	 	3
	

ARTICLE IV.
	

MISCELLANEOUS
	

SECTION 4.01.	
 	

Amendment and Supplement	
 	

4
	SECTION 4.02.	 	Base Indenture	 	4
	SECTION 4.03.	 	Governing Law	 	4
	SECTION 4.04.	 	No Adverse Interpretation of Other Agreements	 	4
	SECTION 4.05.	 	Successors and Assigns	 	4
	SECTION 4.06.	 	Duplicate Originals	 	4
	SECTION 4.07.	 	Severability	 	4

	Exhibits
 
	 	 
	 	 

	EXHIBIT A	 	—	 	FORM OF 2014 NOTE
	EXHIBIT B	 	—	 	FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION TO TRANSFERS PURSUANT TO REGULATION S
	EXHIBIT C	 	—	 	FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION TO TRANSFERS PURSUANT TO REGULATION S
	EXHIBIT D	 	—	 	FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH TRANSFER TO INSTITUTIONAL ACCREDITED INVESTORS
	EXHIBIT E	 	—	 	FORM OF GUARANTEE

i

        FIRST SUPPLEMENTAL INDENTURE dated as of June 17, 2005 (this "Supplemental Indenture") by and among QWEST COMMUNICATIONS
INTERNATIONAL INC., a Delaware corporation (the "Company"), the Guarantors named in the Base Indenture (as defined below) and U.S. BANK NATIONAL
ASSOCIATION, as trustee with respect to the Offered Notes (as defined below) (the "Trustee"). The Trustee, and each other trustee appointed as such with
respect to the Securities of any series issued under the Indenture (as defined below), shall be the "Trustee" (as defined in the Indenture, as supplemented hereby) for all purposes under the Indenture
with respect to the applicable series of Securities but, for the avoidance of doubt, not with respect to any series of Securities for which such Trustee has not been appointed trustee under the terms
of the Indenture and/or any supplement thereto). 

        Each
party agrees as follows for the benefit of the other party and for the equal and ratable benefit of the holders of Notes: 

        WHEREAS,
the Company and J.P. Morgan Trust Company, National Association, are parties to that certain Indenture dated as of February 5, 2004 (the "Base
Indenture," as supplemented by this Supplemental Indenture, the "Indenture") providing for the issuance from time to time of
senior debt securities ("Securities") to be issued in one or more series. 

        WHEREAS,
the Company has previously issued under the Indenture a series of Securities, designated as its 71/2% Senior Notes due 2014 (the "February
Notes"), in an aggregate principal amount of $500,000,000. 

        WHEREAS,
the Company desires and has requested the Trustee to join it in the execution and delivery of this Supplemental Indenture in order to establish and provide for an issuance by
the Company of an additional $600,000,000 aggregate principal amount of such 71/2% Notes due 2014, Series B (the "Offered Notes",
together with the February Notes, the "Notes"). The Offered Notes shall be substantially in the form attached hereto as  Exhibit A. 

        WHEREAS,
Section 10.01 of the Indenture provides that a supplemental indenture may be entered into by the Company and the Trustee without the consent of any Holders to establish
the form or terms of Additional Notes as permitted by Section 2.15 of the Indenture; 

        WHEREAS,
the conditions set forth in the Base Indenture for the execution and delivery of this Supplemental Indenture have been complied with; 

        WHEREAS,
the Company desires to evidence and provide for the acceptance of the appointment of the Trustee as Trustee for the Offered Notes; and 

        WHEREAS,
all things necessary to make this Supplemental Indenture a valid agreement of the Company, the Guarantors and the Trustee, in accordance with its terms, and a valid amendment
of, and supplement to, the Base Indenture have been done. 

        NOW,
THEREFORE, in consideration of the premises and the purchase and acceptance of the Notes by the holders thereof, the Company covenants and agrees with the Trustee, for the equal and
ratable benefit of the Holders, that the Base Indenture is supplemented and amended, to the extent expressed herein, as follows: 

 
 

ARTICLE I.    
    
    THE 7 1/2% NOTES DUE FEBRUARY 15, 2014    
    

        SECTION
1.01.    Designation of Notes.    

        The
changes, modifications and supplements to the Base Indenture of this Supplemental Indenture shall be effected by Article Two and Section 3.01 (a), (b) and
(d) applicable only with respect to, and govern the terms of, the Offered Notes, which shall not be limited in aggregate principal amount, and shall not apply to any other Securities that have
been or may be issued under the Indenture unless a supplemental indenture with respect to such other Securities specifically incorporates such changes, modifications and supplements. Pursuant to this
Supplemental Indenture, there is hereby designated an 

 

additional
$600 million aggregate principal amount of the series of Notes under the Indenture entitled "71/2% Notes due February 15, 2014—"Series B". The
Offered Notes shall be in the form of Exhibit A hereto. The Offered Notes may bear an appropriate legend regarding original issue discount for
federal income tax purposes. Subject to the terms in the Base Indenture, as supplemented by this Supplemental Indenture, the Company may, at its option, without consent from the Holders, issue
additional Notes from time to time. For all purposes under the Indenture, the term "Notes" shall include the February Notes, the Offered Notes and any other Notes issued after such date under the Base
Indenture, as supplemented hereby. 

        SECTION
1.02.    Other Terms of the Notes.    

        Without
limiting the foregoing provisions of this Article One, the terms of the Offered Notes shall be as set forth in the forms of Note set forth in  Exhibit A hereto and as provided in the Base Indenture,
as supplemented hereby. 

        The
Offered Notes shall be payable and may be presented for payment, purchase, conversion, registration of transfer and exchange, without service charge, at the office of the Company
maintained for such purpose in New York, New York, which shall initially be the office or agency of the Trustee. 

 
 

ARTICLE II.    
    
    APPOINTMENT OF U.S. BANK NATIONAL ASSOCIATION    
    

        SECTION
2.01.    Appointment of U.S. Bank National Association.    

        The
Company hereby appoints the Trustee as trustee under the Indenture with respect to the Offered Notes and each other series of Securities for which the Trustee shall be appointed by
the Company pursuant to the Indenture, to act as Trustee under the Indenture, and confirms to the Trustee all of the rights, powers, and trusts of a Trustee under the Indenture with respect to the
Offered Notes and each other series of Securities for which the Trustee shall be appointed by the Company to act as Trustee under the Indenture. The Company shall execute and deliver such further
instruments and do such other things as the Trustee may reasonably require to more fully and certainly vest and confirm in the Trustee all the rights, trusts, and powers hereby delivered and confirmed
upon the Trustee hereunder and under the Indenture. 

        SECTION
2.02.    Acceptance of Trustee.    

        The
Trustee hereby accepts its appointment as trustee with respect to the Offered Notes and shall hereby be vested with all of the authority, rights, powers, trusts, immunities, duties,
benefits and obligations of a Trustee under the Indenture. 

        SECTION
2.03.    Qualification of Trustee.    

        The
Trustee hereby represents and warrants to the Company that the Trustee is qualified under the provisions of Section 310 of the Trust Indenture Act of 1939, as amended, and
Section 7.10 of the Indenture to act as trustee with respect to the Offered Notes under the Indenture. 

        SECTION
2.04.    Notice.    

        Any
notice or communications by the Trustee is duly given if in writing and delivered in person or mailed by certified mail to: 

U.S.
Bank National Association

950 17th Street, Suite 300

Denver, CO 80202

Attn: Corporate Trust Services 

2

 

 
 

ARTICLE III.    
    
    AMENDMENTS TO THE INDENTURE    
    

        SECTION
3.01.    Amendments to the Indenture    

        Pursuant
to Section 10.01(a) and (f) of the Base Indenture, the Indenture is hereby amended as follows: 

        (a)   in
the definition of "Permitted Collateral Liens" in Section 1.01 of the Base Indenture, the words "and the QSC guaranty of the Offered Notes" shall be added at
the end of Clause (2); 

        (b)   in
the definition of "Reference Treasury Dealer" in Section 1.01 of the Base Indenture, the words "Banc of America Securities LLC," shall be removed and the words
"Deutsche Bank Securities Inc." shall replace the words "UBS Warburg LLC"; 

        (c)   in
clause (2) of the definition of "Subordinated Indebtedness" in Section 1.01 of the Base Indenture, the words "the Company" shall be replaced with "QSC"
and the parentheses, but not the words that appear in the parentheses, shall be deleted; 

        (d)   in
the definition of "Termination Event" in Section 1.01 of the Base Indenture, the words "the Offered Notes or" shall appear before the words "Indebtedness
secured by a lien" and after the words "other than"; 

        (e)   in
the second paragraph of Section 2.15 of the Base Indenture, before subparagraph (1), the words "or pursuant to" shall be inserted between the phrase "the
Company shall set forth in" and the phrase "a resolution of its Board of Directors and in an Officer's Certificate"; and 

        (f)    in
Section 4.06(a) of the Base Indenture, the word "or" shall be inserted between the phrase "any Indebtedness of QCII or any of its Restricted Subsidiaries" and
the phrase "to incur any Indebtedness that would otherwise constitute Permitted Indebtedness." 

        (g)   Section 7.12
of the Base Indenture shall be added after Section 7.11 as follows: 

        SECTION
7.12.    Appointment of Co-Trustee or Separate Trustee.    

        (a)   Notwithstanding
any other provisions of this Indenture, at any time, the Company shall have the power and may execute and deliver all instruments to appoint one or more
Person(s) to act as co-trustee(s) or separate trustee(s) under this Indenture, with such powers, duties, obligations, rights and trusts of the Trustee under this Indenture. Each
co-trustee or separate trustee hereunder shall be required to meet the terms of eligibility under Section 7.10. The Trustee shall mail a notice of any such appointment to the
Noteholders. 

        (b)   Every
co-trustee and separate trustee shall be appointed and act subject to the following provisions and conditions: 

          (i)  all
rights, powers, duties and obligations conferred or imposed upon the Trustee shall be conferred or imposed upon and exercised or performed by the Trustee and such
co-trustee or separate trustee either jointly or severally (it being understood that such co-trustee is not authorized to act separately without the Trustee joining in such act
and such separate trustee is authorized to act separately without the Trustee joining in such act). 

         (ii)  neither
the Trustee nor any such co-trustee or separate trustee so appointed hereunder shall have any agency relationship or be personally liable by reason
of any act or omission of any other trustee hereunder, and 

        (iii)  the
Company may at any time accept the resignation of or, with or without cause, remove any co-trustee or separate trustee. 

3

 

        (c)   Each
co-trustee and separate trustee, upon its acceptance of the trusts conferred, shall be vested with the estates or property specified in this Indenture
subject to all the provisions of this Indenture, specifically including every provision of this Indenture relating to the conduct of, affecting the liability of or affording protection to the Trustee. 

 
 

ARTICLE IV.    
    
    MISCELLANEOUS    
    

        SECTION
4.01.    Amendment and Supplement.    

        This
Supplemental Indenture or the Offered Notes may be amended or supplemented as provided for in the Indenture. 

        SECTION
4.02.    Base Indenture.    

        In
the event of any conflict between this Supplemental Indenture and the Base Indenture, the provisions of this Supplemental Indenture shall prevail. 

        SECTION
4.03.    Governing Law.    

        The
laws of the State of New York shall govern this Supplemental Indenture and the Securities of the Series created hereby. 

        SECTION
4.04.    No Adverse Interpretation of Other Agreements.    

        This
Supplemental Indenture may not be used to interpret another indenture, loan or debt agreement of the Company or a Subsidiary. Any such indenture, loan or debt agreement may not be
used to interpret this Supplemental Indenture. 

        SECTION
4.05.    Successors and Assigns.    

        All
covenants and agreements of the Company in this Supplemental Indenture and the Notes shall bind its successors and assigns. All agreements of the Trustee in this Supplemental
Indenture shall bind its successors and assigns. 

        SECTION
4.06.    Duplicate Originals.    

        This
Supplemental Indenture may be executed in counterparts, each of which shall be an original, but such counterparts shall together constitute but one instrument. 

        SECTION
4.07.    Severability.    

        In
case any one or more of the provisions contained in this Supplemental Indenture or in the Notes shall for any reason be held to be invalid, illegal or unenforceable in any respect,
such invalidity, illegality or unenforceability shall not affect any other provisions of this Supplemental Indenture or of the Notes. 

[Signature
Pages Follow] 

4

  

 
 

SIGNATURES    
    

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

	 	 	QWEST COMMUNICATIONS INTERNATIONAL INC.

QWEST SERVICES CORPORATION

QWEST CAPITAL FUNDING, INC.
	

 	
 	

By:	
 	

 
	 	 	 	 	
 Name:

Title:
	

 	
 	

U.S. BANK NATIONAL ASSOCIATION
	

 	
 	

By:	
 	

 
	 	 	 	 	
 Name:

Title:
	

 	
 	

J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION, as Trustee under the Base Indenture
	

 	
 	

By:	
 	

 
	 	 	 	 	
 Name:

Title:

S-1

   EXHIBIT A-1  

[FORM
OF FACE OF INITIAL NOTE] 

[GLOBAL
NOTES LEGEND](a) 

	(a)
	Include
only on Notes issued in global form. 

        UNLESS
AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR
BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITORY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY ("DTC"), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN. 

[RESTRICTED
NOTES LEGEND] 

        THE
NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933 (THE "SECURITIES ACT") AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED
EXCEPT (A)(1) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE
SECURITIES ACT, (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), (4) TO AN INSTITUTIONAL ACCREDITED INVESTOR IN A
TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR (5) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND (B) IN ACCORDANCE WITH ALL
APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED STATES AND OTHER JURISDICTIONS. 

A-1-1

 

        [THIS
GLOBAL NOTE IS A TEMPORARY GLOBAL NOTE FOR PURPOSES OF REGULATION S UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"). NEITHER THIS
TEMPORARY GLOBAL NOTE NOR ANY INTEREST HEREIN MAY BE OFFERED, SOLD OR DELIVERED, EXCEPT AS PERMITTED UNDER THE INDENTURE REFERRED TO BELOW. 

        NO
BENEFICIAL OWNERS OF THIS TEMPORARY GLOBAL NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT OF PRINCIPAL OR INTEREST HEREON UNLESS THE REQUIRED CERTIFICATIONS HAVE BEEN DELIVERED PURSUANT TO
THE TERMS OF THE INDENTURE.](a) 

	(a)
	This
legend to appear only on Temporary Regulation S Global Notes. 

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        THIS
NOTE IS ISSUED WITH ORIGINAL ISSUE DISCOUNT FOR PURPOSES OF SECTION 1271 ET SEQ. OF THE INTERNAL REVENUE CODE. A HOLDER MAY OBTAIN THE ISSUE PRICE, AMOUNT OF ORIGINAL ISSUE
DISCOUNT, ISSUE DATE AND YIELD TO MATURITY FOR SUCH NOTE BY SUBMITTING A REQUEST FOR SUCH INFORMATION TO THE COMPANY AT THE FOLLOWING ADDRESS: 1801 CALIFORNIA STREET, DENVER, CO 80802, ATTENTION:
CHIEF FINANCIAL OFFICER. 

71/2%
SENIOR NOTE DUE 2014, Series B 

	 	 	 	 	 	 	CUSIP No.
	No.	 	 	 	 	 	$	 	 

        QWEST
COMMUNICATIONS INTERNATIONAL INC., a Delaware corporation (the "Company"), promises to pay to                        , or its
registered assigns, the principal sum of            
in U.S. Dollars on February 15, 2014. 

        Interest
Payment Dates: February 15 and August 15 

        Record
Dates: February 1 and August 1 

        Additional
provisions of this Note are set forth on the other side of this Note. 

	 	 	 	 	QWEST COMMUNICATIONS INTERNATIONAL INC.
	

 	
 	

 	
 	

By:	
 	

 
	 	 	 	 	 	 	
 Name:

Title:
	

Dated:	
 	

 	
 	

 
	

TRUSTEE'S CERTIFICATE OF AUTHENTICATION	
 	

 	
 	

 
	

U.S. BANK NATIONAL ASSOCIATION as Trustee, certifies that this is one of the Notes referred to in the Indenture.	
 	

 	
 	

[Seal]
	

by	
 	

 	
 	

 	
 	

 
	 	 	
 Authorized Signatory	 	 	 	 

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[FORM OF REVERSE SIDE OF INITIAL FIXED RATE NOTE]
  
    7 1/2% Senior Note due 2014, Series B    
    

	1.
	Interest

        QWEST
COMMUNICATIONS INTERNATIONAL INC., a Delaware corporation (the "Company"), promises to pay interest on the principal amount
of this Note at the rate per annum shown above and shall pay Additional Interest, if any, payable pursuant to the Registration Rights Agreement (the "Registration Rights
Agreement") dated June 17, 2005 by and among the Company, the Guarantors and the Initial Purchasers (as such is defined in the Registration Rights Agreement). 

        The
Company will pay interest and Additional Interest, if any, semi-annually in arrears on February 15 and August 15 of each year commencing on
August 15, 2005. Interest on the Notes will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from the date of original issuance with respect to
this Note. Interest will be computed on the basis of a 360-day year comprised of a 360-day year comprised of twelve 30-day months. The Company shall pay interest on
overdue principal at the rate borne by the Notes, and it shall pay interest on overdue installments of interest at the same rate to the extent lawful. 

	2.
	Method of Payment

        The
Company will pay interest (except defaulted interest) on and Additional Interest, if any, in respect of this Note to the Persons who are registered holders of this Note at the close
of business on the 1st of February and the 1st of August immediately preceding the interest payment date even if Notes are canceled after the record date and on or before the interest payment date.
Holders must surrender this
Note to a Paying Agent to collect principal payments. The Company will pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and
private debts. However, the Company may pay principal and interest by check payable in such money or by wire transfer of federal funds. 

	3.
	Paying Agent and Registrar

        Initially,
U.S. Bank National Association (the "Trustee") will act as Paying Agent and Registrar. The Company may appoint and change any
Paying Agent, Registrar or co-registrar without notice to the Holders. The Company may act as Paying Agent, Registrar or co-registrar. 

	4.
	Indenture

        This
Note is issued under an Indenture dated as of February 5, 2004, among the Company, the Guarantors and the J.P. Morgan Trust Company, National Association (the
"Base Indenture"), as supplemented by a supplemental indenture among the Company, the Guarantors and the Trustee dated June 17, 2005 (the
"Supplemental Indenture" and together with the Base Indenture, the "Indenture"). This Note is one of the
71/2% Senior Notes due 2014-Series B originally being issued on June 17, 2005 (the "Initial Notes"), and this Note is being issued as part of an issuance of
Additional Notes under the Indenture. Additional Notes of the same or a different series may be issued in an unlimited amount subject to compliance with Section 4.06 of the Indenture. For
purposes of this Note, references to the Notes include the Initial Notes, Exchange Notes issued in exchange for such Initial Notes pursuant to the Indenture. However, to the extent provided in the
Indenture, all Initial Notes and Exchange Notes issued in exchange therefor will be considered together part of a single series of Notes and may be considered a part of a single class of Notes with
the February Notes and any Additional Notes issued under the Indenture for certain purposes. The terms of the Notes include those stated in the Indenture and those made part of the Indenture by
reference to the TIA. Terms defined in the Indenture and not defined herein have the meanings ascribed thereto in the Indenture. The Notes are subject to all such 

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terms,
including in the event of a conflict with this Note, and Noteholders are referred to the Indenture and the TIA for a statement of those terms. 

        The
Notes are the senior obligations of the Company. The Indenture imposes certain limitations on the incurrence of Indebtedness by the Company and its Restricted Subsidiaries; the
payment of dividends and other payments by the Company and its Restricted Subsidiaries; Investments; sales of assets of the
Company and Restricted Subsidiaries; certain transactions with Affiliates; Liens; and consolidations, mergers and transfers of all or substantially all of the Company's or a Guarantor's assets. In
addition, the Indenture prohibits certain restrictions on distributions from Restricted Subsidiaries. 

	5.
	Optional Redemption

          (i)  Except
as set forth below, the Offered Notes may not be redeemed prior to February 15, 2009. At any time on or after February 15, 2009, the Offered Notes
will be subject to redemption at the option of the Company, in whole or in part, at the redemption prices (expressed as percentages of principal amount) set forth below, plus accrued and unpaid
interest and Additional Interest, if any, thereon, to the applicable redemption date (subject to the right of Holders on the relevant record date to receive interest due on the relevant interest
payment date), if redeemed during the twelve-month period beginning on February 15 of the years indicated below: 

	Year
 
	 	Price
	 
	2009	 	103.750	%
	2010	 	102.500	%
	2011	 	101.250	%
	2012 and thereafter	 	100.000	%

         (ii)  In
addition, the Company may redeem all or a part of the Offered Notes upon not less than 30 nor more than 60 days' notice, at a redemption price equal to the
greater of (1) 100% of the principal amount thereof or (2) the present value, as determined by an Independent Financial Advisor, of (A) the applicable percentage set forth above
of the principal amount of the Offered Notes being redeemed as of February 15 of the first period set forth above ending on or after the date of such redemption (assuming a 360-day
year consisting of twelve 30-day months) plus (B) all required interest payments due on such Offered Notes through February 15 of such period (excluding accrued interest),
discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus 50 basis points, plus in each
case accrued interest to the redemption date. 

        (iii)  Notwithstanding
the foregoing, at any time prior to February 15, 2007, the Company may redeem up to 35% of the aggregate principal amount of the Offered Notes
outstanding at a redemption price equal to 107.50% of the principal amount thereof, together with accrued and unpaid interest to such redemption date, with the net cash proceeds of any capital
contributions to the Company in respect of Qualified Equity Interests or one or more public or private sales by the Company of Qualified Equity Interests (other than proceeds from a sale to any of the
Company's Subsidiaries or any employee benefit plan in which the Company or any of its Subsidiaries participates); provided that: 

        (a)   at
least 65% in aggregate of the originally issued principal amount of the Offered Notes remain outstanding immediately after the occurrence of such redemption; and 

        (b)   the
sale of such Qualified Equity Interests is made in compliance with the terms of the Indenture. 

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	6.
	Notices of Redemption

        Except
as otherwise provided in the Indenture or herein, notices of redemption shall be mailed by first-class mail at least 30 days but not more than 60 days before the
redemption date to each Holder of Notes to be redeemed at its registered address all in accordance with the Indenture. If less than all of the Notes are to be redeemed at any time, selection of Notes
for redemption will be made by the Trustee in compliance with the requirements of the principal national securities exchange, if any, on which the Notes are listed, or, if the Notes are not so listed,
on a pro rata basis, by lot or by such method as the Trustee shall deem fair and appropriate; provided
that no Notes of $1,000 or less shall be redeemed in part; provided that any redemption pursuant to paragraph 5(iii) shall be effected on
a pro rata basis. If any Note is to be redeemed in part only, the notice of redemption that relates to such
Note shall state the portion of the principal amount thereof to be redeemed. On and after the redemption date, interest ceases to accrue on Notes or portions of them called for redemption. 

	7.
	Repurchase at the Option of the Holder

        (a)   Upon
a Change of Control, any Holder of Notes will have the right, subject to certain conditions set forth in the Indenture, to require the Company to repurchase all or
any part (equal to $1,000 or an integral multiple thereof) of the Notes of such Holder at a purchase price equal to 101% of the aggregate principal amount of the Notes to be repurchased plus accrued
and unpaid interest and Additional Interest, if any, thereon, to the date of repurchase (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant
interest payment date that is on or prior to the date of repurchase) as provided in, and subject to the terms of, the Indenture. 

        (b)   If
the Company or a Subsidiary consummates any Asset Sales, within ten Business Days of each date on which the aggregate amount of Excess Proceeds exceeds
$50.0 million, the Company will commence an offer to all Holders of Notes and all holders of certain other Indebtedness containing provisions similar to those set forth in the Indenture with
respect to offers to purchase or redeem with the proceeds of sales of assets (an "Asset Sale Offer") pursuant to Section 4.09 of the Indenture to
purchase the maximum principal amount of Notes (including any Additional Notes) that may be purchased out of the Excess Proceeds at an offer price in cash in an amount equal to 100% of the principal
amount thereof plus accrued and unpaid interest and Additional Interest thereon, if any, to the date fixed for the closing of such offer, in accordance with the procedures set forth in the Indenture.
To the extent that the aggregate amount of Notes (including any Additional Notes) and such other Indebtedness tendered pursuant to an Asset Sale Offer is less than the Excess Proceeds, the Company (or
such Subsidiary) may use such deficiency for any purpose not otherwise prohibited by the Indenture. If the aggregate principal amount of Notes and such other Indebtedness surrendered by the Holders
thereof exceeds the amount of Excess Proceeds, the Trustee shall select the Notes and such other Indebtedness to be purchased on a pro rata basis. Holders of Notes that are the subject of an offer to
purchase will receive an Asset Sale Offer from the Company prior to any related purchase date and may elect to have such Notes purchased by completing the form entitled "Option of Holder to Elect
Purchase" on the reverse of the Notes. 

	8.
	Guarantees and Collateral Documents

        All
obligations in respect of this Note have been fully and unconditionally guaranteed by Qwest Capital Funding, Inc. and Qwest Services Corporation on a joint and several basis
pursuant to the Indenture. 

        In
order to secure the due and punctual payment of all obligations of QSC under the QSC Guarantee of the Notes when and as the same shall be due and payable, QSC has granted Liens on the
Collateral to the Collateral Agent for the benefit of the Trustee and the Holders of Notes. 

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        Each
Holder, by accepting a Note, agrees to all of the terms and provisions of the Security Documents as the same may be amended from time to time pursuant to the respective provisions
thereof and the Indenture. 

        The
Trustee and each Holder acknowledge that a release of any of the Collateral or any Lien strictly in accordance with the terms and provisions of any of the Security Documents and the
terms and provisions of the Indenture will not be deemed for any purpose to be an impairment of the security under the Indenture. The Collateral is subject to release upon a Termination Event and
under certain other circumstances. 

	9.
	Denominations; Transfer; Exchange

        The
Notes are in registered form without coupons in denominations of $1,000 and whole multiples of $1,000. A Holder may transfer or exchange Notes in accordance with the Indenture. Upon
any transfer or exchange, the Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements or transfer documents and to pay any taxes required by law or
permitted by the Indenture. The Registrar need not register the transfer of or exchange any Notes selected for redemption (except, in the case of a Note to be redeemed in part, the portion of the Note
not to be redeemed) or transfer or exchange any Notes for a period of 15 days prior to a selection of Notes to be redeemed or 15 days before an interest payment date. 

	10.
	Persons Deemed Owners

        The
registered Holder of this Note may be treated as the owner of it for all purposes. 

	11.
	Unclaimed Money

        If
money for the payment of principal or interest remains unclaimed for two years, the Paying Agent shall pay the money back to the Company at its request, or if then held by the
Company, shall be discharged from such trust (unless an abandoned property law designates another Person for payment thereof). After any such payment, Holders entitled to the money must look only to
the Company for payment thereof, and all liability of the Paying Agent with respect to such money, and all liability of the Company as trustee thereof, shall thereupon cease. 

	12.
	Discharge and Defeasance

        Subject
to certain conditions set forth in the Indenture, the Company and the Guarantors at any time may terminate some or all of its obligations under the Indenture, the Notes
Guarantees, the Registration Rights Agreement and the Notes if the Company deposits with the Trustee, cash in U.S. legal tender or U.S. Government Obligations for the payment of principal and interest
on the Notes to redemption or maturity, as the case may be. 

	13.
	Amendment, Waiver

        Subject
to certain exceptions set forth in the Indenture, (i) the Indenture, the Notes, the Notes Guarantees or the Security Documents may be amended or supplemented with the
written consent of the Holders of at least a majority in principal amount of the then outstanding Notes (including the February Notes and any Additional Notes), voting as a group, and (ii) any
existing default or noncompliance with any provision of the Indenture, the Notes, Notes Guarantees or the Security Documents (other than payment of principal, premium, if any, Additional Interest, if
any, and interest) may be waived with the consent of the Holders of a majority in principal amount of the then outstanding Notes. Subject to certain exceptions set forth in the Indenture, without the
consent of any Noteholder, the Company, the Guarantors and the Trustee may amend or supplement the Indenture, the Notes, the Note Guarantees or the Security Documents, to cure any ambiguity, defect or
inconsistency, to provide for uncertificated Notes in addition to or in place of certificated Notes (provided that the uncertificated Notes are issued in registered form for purposes of
Section 163(f) of 

A-1-7

 

the
Code, or in a manner such that the uncertificated Notes are described in Section 163(f)(2)(B) of the Code), to provide for the assumption of the Company's obligations to Holders of Notes in
the case of a merger, consolidation or sale of assets, to release any Guarantor from any of its obligations under its applicable Note Guarantee or the Indenture (to the extent permitted by the
Indenture) to make any change that would provide any additional rights or benefits to the Holders of Notes or that, as determined by the Board of Directors of the Company in good faith, does not
materially adversely affect the legal rights of any such Holder under the Indenture, the Notes, the Notes Guarantees or the Security Documents, to conform the Indenture to the "Description of Notes"
contained in the offering memorandum relating to the Initial Notes, to comply with the requirements of the SEC in order to effect or maintain the qualification of the Indenture under the TIA, to
provide additional assets as Collateral, to add additional guarantees and, following a Termination Event, to eliminate references to subordination of the QSC Guarantee. 

	14.
	Defaults and Remedies

        Under
the Indenture (and subject to the terms of the Indenture), an Event of Default occurs if there is: (i) default for 30 days in the payment when due of interest on, or
Additional Interest with respect to, the Notes; (ii) default in payment when due of the principal of or premium, if any, on the Notes (including the failure to make a payment to purchase Notes
tendered pursuant to a Change of Control Offer or an Asset Sale Offer); (iii) failure by the Company (A) to comply with the provisions of Sections 4.11 and 5.01 of the Indenture or
(B) for 45 days after receipt of notice from the Trustee or the Holders of at least 25% in principal amount of the then outstanding Notes to comply with any other agreement or covenant
of the Indenture; (iv) default under any Debt Instrument under which there may be issued or by which there may be secured or evidenced Indebtedness of the Company or any of its Restricted
Subsidiaries (other than QCC to the extent that none of QSC, the Company or QCF have outstanding a Debt Instrument governing Debt Securities under which there is a similar default as this
clause (iv) with respect to QCC that applies to such default) whether such Indebtedness now exists or is incurred after the Issue Date, which default: (A) is caused by a failure to pay
when due principal on such Indebtedness at the final maturity thereof; (B) results in the acceleration of such Indebtedness prior to its express final maturity or (C) results in the
commencement of judicial proceedings to foreclose upon, or to exercise remedies under applicable law or applicable security documents to take ownership of or to cause the sale of, the assets securing
such Indebtedness (other than the consensual provision of assets securing non-recourse Indebtedness), and in each case, the principal amount of such Indebtedness, together with any other
Indebtedness with respect to which an event described in clause (A), (B) or (C) has occurred and is continuing, aggregates more than $100.0 million; (v) one or more
final and non-appealable judgments or orders that exceed $100.0 million in the aggregate (net of amounts covered by insurance or bonded) for the payment of money have been entered
by a court or courts of competent jurisdiction against QSC, the Company or any of its Restricted Subsidiaries and such judgment or judgments have not been satisfied, stayed, annulled or rescinded
within 60 days of being entered; (vi) QSC, the Company or any Significant Subsidiary pursuant to or within the meaning of any Bankruptcy Law: (A) commences a voluntary case,
(B) consents to the entry of an order for relief against it in an involuntary case, (C) consents to the appointment of a Custodian of it or for all or substantially all of its assets, or
(D) makes a general assignment for the benefit of its creditors; (vii) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that: (A) is for relief
against QSC, the Company or any Significant Subsidiary as debtor in an involuntary case, (B) appoints a Custodian of QSC, the Company or any Significant Subsidiary or a Custodian for all or
substantially all of the assets of the Company or any Significant Subsidiary, or (C) orders the liquidation of QSC, the Company or any Significant Subsidiary, and the order or decree remains
unstayed and in effect for 60 days; (vii) (A) any Note Guarantee shall be held in a judicial proceeding before a court of competent jurisdiction not to be in full force and effect
(other than in accordance with the terms of such Note Guarantee and the Indenture) or is declared in such a proceeding null and void and unenforceable or found to be invalid or (B) any 

A-1-8

 

Guarantor
denies its liability under its Note Guarantee (other than by reason of release of a Guarantor from its Note Guarantee in accordance with the terms of the Indenture and the Note Guarantee);
or (ix) default by QSC in the performance of the Security Documents which adversely affects the enforceability or the validity of the Collateral Agent's Lien on the Collateral or which
adversely affects the condition or value of the Collateral, taken as a whole, in any material respect, repudiation or disaffirmation by QSC of its obligations under the Security Documents or the
determination in a judicial proceeding before a court of competent jurisdiction that the Security Documents are unenforceable or invalid against QSC for any reason. 

        Noteholders
may not enforce the Indenture or the Notes except as provided in the Indenture. The Trustee may refuse to enforce the Indenture or the Notes unless it receives indemnity or
security reasonably satisfactory to it. Subject to certain limitations, Holders of a majority in principal amount of the Notes may direct the Trustee in its exercise of any trust or power. The Trustee
may withhold from Noteholders notice of any continuing Default (except a Default in payment of principal, premium, if any, or interest) if and so long as a committee of its Trust Officers in good
faith determines that withholding notice is in the interest of the Holders. 

	15.
	Subordination

        Prior
to the occurrence of a Termination Event, payment of QSC's obligations under the QSC Guarantee will be subordinated to the prior payment of Senior Debt on the terms provided in the
Indenture. 

	16.
	Trustee Dealings with the Company

        Subject
to certain limitations imposed by the TIA, the Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Notes and may otherwise
deal with and collect obligations owed to it by the Company or its Affiliates and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not Trustee. 

	17.
	No Personal Liability of Directors, Officers, Employees and Stockholders

        No
past, present or future director, officer, employee, incorporator, or stockholder of the Company, as such, shall have any liability for any obligations of the Company under the Notes,
the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. No past, present or future director, officer, employee, incorporator, or stockholder of any
of the Guarantors, as such, shall have any liability for any obligations of the Guarantors under the Notes Guarantees, the Indenture or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each holder of Notes and Notes Guarantees by accepting a Note and a Note Guarantee waives and releases all such liabilities. The waiver and release are part of the
consideration for issuance of the Notes and the Notes Guarantees. Such waiver may not be effective to waive liabilities under the federal securities laws and it is the view of the SEC that such a
waiver is against public policy. 

	18.
	Governing Law

        THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF
CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

	19.
	Authentication

        This
Note shall not be valid until an authorized signatory of the Trustee (or an authenticating agent) manually signs the certificate of authentication on the other side of this Note. 

A-1-9

 

	20.
	Abbreviations

        Customary
abbreviations may be used in the name of a Noteholder or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the entireties), JT TEN (=joint tenants with
rights of survivorship and not as tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors Act). 

	21.
	CUSIP Numbers

        Pursuant
to a recommendation promulgated by the Committee on Uniform Security Identification Procedures the Company has caused CUSIP numbers to be printed on the Notes and has directed
the Trustee to use CUSIP numbers in notices of redemption as a convenience to Noteholders. No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained
in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon. 

        The Company will furnish to any Noteholder upon written request and without charge to the Noteholder a copy of the Indenture which has in it the text of this Note
in larger type. Requests may be made to:

QWEST COMMUNICATIONS INTERNATIONAL INC.

1801 California Street

Denver, Colorado 80202

Attention of Secretary

A-1-10

 
 
 

ASSIGNMENT FORM    
    

        To assign this Note, fill in the form below: 

        I
or we assign and transfer this Note to 

	

 	
 	

 
	
 (Print or type assignee's name, address and zip code)
	

 	
 	

 
	
 (Insert assignee's soc. sec. or tax I.D. No.)

and
irrevocably appoint                        agent to transfer this Note on the books of the Company. The agent may substitute
another to act for him. 

	Date:	 	 	 	Your Signature:	 	 
	 	 	
	 	 	 	

           

	Signature Guarantee:	 	 
	 	 	
 (Signature must be guaranteed by a participant in a recognized signature guarantee medallion program)

	

 	
 	

 
	
 Sign exactly as your name appears on the other side of this Note.

A-1-11

  

EXHIBIT B  

 
 

CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR
  REGISTRATION OF TRANSFER RESTRICTED NOTES    
    

        Reference is hereby made to that certain indenture dated February 5, 2004 (the "Base Indenture") among
Qwest Communications International Inc. (the "Company"), the Guarantors (as defined therein) and J.P. Morgan Trust Company, National Association
as supplemented by the supplemental indenture among the Company, the Guarantors and U.S. Bank National Association (the "Trustee") dated June 17,
2005 (the "Supplemental Indenture" and together with the Base Indenture, the "Indenture"). Capitalized
terms used but not defined herein shall have the meanings set forth in the Indenture. 

        This
certificate relates to $                        principal amount of Notes held in (check applicable space)
            book-entry or            definitive form by the
undersigned. 

        The
undersigned (check one box below): 

        / /
has requested the Trustee by written order to deliver in exchange for its beneficial interest in the Global Note held by the Depository a Note or Notes in definitive,
registered form of authorized denominations and an aggregate principal amount equal to its beneficial interest in such Global Note (or the portion thereof indicated above); 

        / /
has requested the Trustee by written order to exchange or register the transfer of a Note or Notes. 

        In
connection with any transfer of any of the Notes evidenced by this certificate occurring prior to the expiration of the periods referred to in Rule 144(k) under the Securities
Act of 1933, as amended, the undersigned confirms that such Notes are being transferred in accordance with its terms: 

CHECK ONE BOX BELOW:  

/ /    (1)    to
the Company or any of its subsidiaries; or 

/ /    (2)    pursuant
to an effective registration statement under the Securities Act of 1933, as amended; or 

/ /    (3)    inside
the United States to a "qualified institutional buyer" (as defined in Rule 144A under the Securities Act of 1933, as amended) that purchases
for its own account or for the account of a qualified institutional buyer to whom notice is given that such transfer is being made in reliance on Rule 144A under the Securities Act of 1933, as
amended, in each case pursuant to and in compliance with Rule 144A thereunder; or 

/ /    (4)    outside
the United States in an offshore transaction within the meaning of Regulation S under the Securities Act of 1933, as amended, in compliance
with Rule 904 thereunder; or 

/ /    (5)    inside
the United States to an institutional "accredited investor" (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities
Act of 1933, as amended) that has furnished to the Trustee a signed letter containing certain representations and agreements (the form of which letter is attached to the Indenture as  Exhibit D and
which may be obtained from the Trustee); or 

/ /    (6)    pursuant
to another available exemption from registration provided by Rule 144 under the Securities Act of 1933, as amended; or 

/ /    (7)    in
accordance with another exemption from the registration requirements of the Securities Act of 1933, as amended. 

B-1

 

        Unless
one of the boxes is checked, the Trustee will refuse to register any of the Notes evidenced by this certificate in the name of any person other than the registered holder thereof;  provided, however, that if box (4), (5) or (6) is checked, the Trustee may require, prior
to registering any such transfer of the Notes, such legal opinions, certifications and other information as the Company has reasonably requested to confirm that such transfer is being made pursuant to
an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act of 1933, as amended, such as the exemption provided by Rule 144 thereunder. 

	

 	
 	

	 	 	Signature

           

	Signature Guarantee:	 	

	 	 	(Signature must be guaranteed by a participant in a recognized signature guarantee medallion program)

TO BE COMPLETED BY PURCHASER IF (3) ABOVE IS CHECKED. 

        The
undersigned represents and warrants that it is purchasing this Note for its own account or an account with respect to which it exercises sole investment discretion and that it and
any such account is a "qualified institutional buyer" within the meaning of Rule 144A under the Securities Act of 1933, as amended ("Rule 144A"), and is aware that the sale to it is
being made in reliance on Rule 144A and acknowledges that it has received such information regarding the Company as the undersigned has requested pursuant to Rule 144A or has determined
not to request such information and that it is aware that the transferor is relying upon the undersigned's foregoing representations in order to claim the exemption from registration provided by
Rule 144A. 

	Dated:	 	 	 	 
	 	 	
	 	

	 	 	 	 	NOTICE: To be executed by an executive officer

B-2

 
 
 

SCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTES    
    

        The following increases or decreases in this Global Note have been made: 

	Date of Exchange
 
	 	Amount of decrease in Principal Amount of this Global Note
	 	Amount of increase in Principal Amount of this Global Note
	 	Principal amount of this Global Note following such decrease or increase
	 	Signature of authorized signatory of Trustee or Notes Custodian

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 

B-3

 
 
 

OPTION OF HOLDER TO ELECT PURCHASE    
    

        If you want to elect to have this Note purchased by the Company pursuant to Section 4.09, or 4.11 of the Indenture, check the box: 

	4.09 Asset Sale	 	4.11 Change of Control Offering

        If
you want to elect to have only part of this Note purchased by the Company pursuant to Section 4.09 or 4.11 of the Indenture, state the amount:
$                  . 

	Date:	 	 	 	Your Signature:	 
	 	 	
	 	 	
 (Sign exactly as your name appears on the other side of the Note)
	

 	
 	

 	
 	

 	

 
	 	 	 	 	
 Tax I.D. number

	Signature Guarantee:	 	 
	 	 	
 (Signature must be guaranteed by a participant in a recognized signature guarantee medallion program)

B-4

   EXHIBIT C  

[FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION

WITH TRANSFERS PURSUANT TO REGULATION S]  

Qwest
Communications International Inc.

1801 California Street

Denver, Colorado 80202 

Attention:
Chief Financial Officer 

	

Re:	
 	

Qwest Communications International Inc. (the "Company")

71/2% Senior Notes due 2014 (the "Notes")

Dear
Ladies and Gentlemen: 

        This
letter relates to U.S. $                        principal amount of Notes represented by a Note (the "Legended Note") which bears
a legend outlining restrictions upon transfer of such
Legended Note. Pursuant to Section 2.01 of the Indenture dated as of February 5, 2004, as supplemented by a First Supplemental Indenture dated as of June 17, 2005 (the
"Indenture") relating to the Notes, we hereby certify that we are (or we will hold such Notes on behalf of) a person outside the United States to whom the Notes could be transferred in accordance with
Rule 904 of Regulation S promulgated under the U.S. Securities Act of 1933. Accordingly, you are hereby requested to exchange the legended certificate for an unlegended certificate
representing an identical principal amount at maturity of Notes, all in the manner provided for in the Indenture. 

        You
and the Company are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal
proceedings or official inquiry with respect to the matters covered hereby. Terms used in this certificate have the meanings set forth in Regulation S. 

	

 	
 	

Very truly yours,
	

 	
 	

 [Name of Holder]
	

 	
 	

By:	

          
 Authorized Signature

C-1

   EXHIBIT D  

[FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION

WITH TRANSFER TO INSTITUTIONAL ACCREDITED INVESTORS]  

Qwest
Communications International Inc.

1801 California Street

Denver, Colorado 80202 

Dear
Ladies and Gentlemen: 

        This
certificate is delivered to request a transfer of $                              principal amount of
the 71/2% Senior Notes due 2014 (the "Notes") of Qwest
Communications International Inc. (the "Company"). 

        Upon
transfer, the Notes would be registered in the name of the new beneficial owner as follows: 

	Name:	 	 
	 	 	

	Address:	 	 
	 	 	

	Taxpayer ID Number:	 	 
	 	 	

        The
undersigned represents and warrants to you that: 

        1.     We
are an institutional "accredited investor" (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as amended (the
"Securities Act")), and we are acquiring the Notes not with a view to, or for offer or sale in connection with, any distribution in violation of the Securities Act. We have such knowledge and
experience in financial and business matters as to be capable of evaluating the merits and risk of our investment in the Notes and invest in or purchase Notes similar to the Notes in the normal course
of our business. We and any accounts for which we are acting are each able to bear the economic risk of our or its investment. 

        2.     We
understand that the Notes have not been registered under the Securities Act and, unless so registered, may not be sold except as permitted in the following sentence.
We agree on our own behalf and on behalf of any investor account for which we are purchasing Notes to offer, sell or otherwise transfer such Notes prior to the later of the date which is two years
after (X) the later of (A) the date of original issue or (B) the date on which this Note was acquired from an affiliate of the Company or (Y) the date that is three months
after the last date on which the Company or any affiliate of the Company was the owner of such Notes (or any predecessor thereto) only (a) to Qwest Communications International Inc. or
any subsidiary thereof, (b) inside the United States to a Qualified Institutional Buyer in compliance with Rule 144A under the Securities Act, (c) inside the United States to an
Accredited Investor that, prior to such transfer, furnishes (or has furnished on its behalf by a U.S. Broker-Dealer) to the Trustee a signed letter containing certain representations and agreements
relating to the restrictions on transfer of this security (the form of which letter can be obtained from the Trustee for this Note), (d) outside the United States in an offshore transactions in
compliance with Rule 904 under the Securities Act (if available), (e) pursuant to the exemption from registration provided by Rule 144 under the Securities Act (if available),
(f) in accordance with another exemption from the registration requirements of the Securities Act (and based upon an opinion of counsel if Qwest Communications International Inc. so
requests), or (g) pursuant to an effective registration statement under the Securities Act, subject in each of the foregoing cases to any requirement of law that the disposition of our property
or the property of such investor account or 

D-1

 

accounts
be at all times within our or their control and in compliance with any applicable state securities laws. In connection with any transfer of this security prior to the later of the date which
is two years after (X) the later of (A) the date of original issue or (B) the date on which this Note was acquired from an affiliate of the Company or (Y) the date that is
three months after the last date on which the Company or any affiliate of the Company was the owner of such Notes (or any predecessor thereto), pursuant to clause (c), (d) or
(f) above if the holder must, prior to such transfer, furnish to the Trustee and Qwest Communications International Inc. such certifications, legal opinions or other information as
either of them may reasonably require to confirm that such transfer is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities
Act. As used herein, the terms "offshore transaction", "United States" and "U.S. person" have the meaning given to them by Regulation S under the Securities Act. 

	 	 	TRANSFEREE:	 
	 	 	 	

	 	 	BY	 
	 	 	 	

D-2

  

EXHIBIT E  

 
  [FORM OF GUARANTEE]    
    

        Each undersigned Guarantor (as defined in the Indenture referred to in the Note upon which this notation is endorsed and each referred to as the "Guarantor,"
which term includes any successor person under the Indenture) hereby unconditionally and irrevocably, jointly and severally, guarantees as a primary obligor and not merely as a surety (such guarantee
to be referred to herein as the "Guarantee"), to each of the Holders and to the Trustee and their respective successors and assigns that (i) the principal of and interest on the Notes will be
promptly paid in full when due, subject to any applicable grace period, whether at maturity, by acceleration or otherwise, and interest on the overdue principal, if any, and interest on any interest,
if any, to the extent lawful, of the Notes and all other obligations of the Company to the Holders or the Trustee under the Indenture or thereunder will be promptly paid in full or performed, all in
accordance with the terms under the Indenture and thereof; and (ii) in case of any extension of time of payment or renewal of any of the Notes or of any such other obligations, the same will be
promptly paid in full when due or performed in accordance with the terms of the extension or renewal, subject to any applicable grace period, whether at maturity, by acceleration or otherwise,
subject, however, in the case of clauses (i) and (ii) above, to the limitations set forth in Section 12.02 of the Indenture. The obligations of the Guarantors to the Holders of
Notes and to the Trustee pursuant to the Guarantee and the Indenture are expressly set forth in Article XII of the Indenture and reference is hereby made to the Indenture for the precise terms
of the Guarantee. Prior to the occurence of a Termination Event (as defined in the Indenture), the obligations of QSC under the QSC Guarantee shall be subordinated to the obligations of QSC to holders
of Senior Debt to the extent set forth in Article VIII of the Indenture. Each Holder of a Note, by accepting the same, (a) agrees to and shall be bound by such provisions and
(b) appoints the Trustee attorney-in-fact of such Holder for such purpose. 

        No
stockholder, officer, director or incorporator, as such, past, present or future, of the Guarantor shall have any liability under the Guarantee by reason of his or its status as such
stockholder, officer, director or incorporator. 

        This
Guarantee shall not be valid or obligatory for any purpose until the certificate of authentication on the Notes upon which this Guarantee is noted shall have been executed by the
Trustee under the Indenture by the manual signature of one of its authorized officers. 

        IN
WITNESS WHEREOF, each of the undersigned Guarantors has caused this Guarantee to be signed by its duly authorized officer. 

	 	 	[NAME OF GUARANTOR]
	 	 	 	 	 
	 	 	 	 	 
	 	 	By:	 	 
	 	 	 	 	

	 	 	 	 	Name:
	 	 	 	 	Title:

E-1

QuickLinks

TABLE OF CONTENTS

ARTICLE I. THE 7 1/2% NOTES DUE FEBRUARY 15, 2014

ARTICLE II. APPOINTMENT OF U.S. BANK NATIONAL ASSOCIATION

ARTICLE III. AMENDMENTS TO THE INDENTURE

ARTICLE IV. MISCELLANEOUS

SIGNATURES

[FORM OF REVERSE SIDE OF INITIAL FIXED RATE NOTE] 7 1/2% Senior Note due 2014, Series B

ASSIGNMENT FORM

CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION OF TRANSFER RESTRICTED NOTES

SCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTES

OPTION OF HOLDER TO ELECT PURCHASE

[FORM OF GUARANTEE]

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