Document:

Employment Agreement

 Exhibit 10.5 
  
 EMPLOYMENT AGREEMENT 
 (Jennifer Evans Stacey) 
  
 THIS EMPLOYMENT AGREEMENT
(the “Agreement”) is entered into this 22nd day of March, 2005 by and between Auxilium Pharmaceuticals, Inc. (the “Company”) and Jennifer Evans Stacey (“Executive”). 
  
 WHEREAS, the Company desires to employ Executive, and Executive desires to be
employed by the Company upon the terms and conditions hereinafter set forth; 
  
 NOW, THEREFORE, the parties hereto, intending to be legally bound, hereby agree as follows: 
  
 1. Employment. The Company hereby agrees to employ Executive, and Executive hereby accepts such employment and agrees to perform Executive’s duties and
responsibilities, in accordance with the terms, conditions and provisions hereinafter set forth. This Agreement shall be effective as of February 7, 2005 (the “Effective Date”) and shall continue until terminated in accordance with Section
2 hereof. Nothing in this Agreement shall be construed as giving Executive any right to be retained in the employ of the Company, and Executive specifically acknowledges that Executive shall be an employee-at-will of the Company, and thus subject to
discharge at any time by the Company with or without cause and without compensation of any nature except as provided in Section 2 below. 
  
 1.1 Duties and Responsibilities. Commencing on the Effective Date, Executive shall serve as the Executive Vice President, Secretary and General
Counsel of the Company and shall perform all duties and accept all responsibilities incident to such position as may be reasonably assigned to Executive by the Company’s Board of Directors (the “Board”) or by the Chief Executive
Officer of the Company. 
  
 1.2 Extent of Service.
Executive agrees to use Executive’s best efforts to carry out Executive’s duties and responsibilities under Section 1.1 hereof and, consistent with the other provisions of this Agreement, to devote substantially all of Executive’s
business time, attention and energy thereto. The foregoing shall not be construed as preventing Executive from making investments in other businesses or enterprises, provided that Executive agrees not to become engaged in any other business activity
which, in the reasonable judgment of the Board, is likely to interfere with Executive’s ability to discharge Executive’s duties and responsibilities to the Company. 
  
 1.3 Base Salary. For all the services rendered by Executive hereunder, the Company shall pay Executive a base salary
(“Base Salary”) at the annual rate of $250,000, payable bi-weekly in installments at such times as the Company customarily pays its other senior level executives. Executive’s Base Salary shall be reviewed annually for appropriate
increases by the Board or compensation committee pursuant to the normal performance review policies for senior level executives. 
  
 1.4 Signing Bonus. Executive shall receive a signing bonus of $19,000 upon execution of this Agreement and shall be granted, upon approval of the
Board of Directors of the 

  

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Company, a non-qualified option to purchase 110,000 shares (the “Option Grant”) of the Company’s common stock at an exercise price per share
equal to the last reported sale price of a share of the Company’s common stock on the Nasdaq National market on the date the Option Grant is approved. Vesting of the Option Grant will be over four years with twenty-five percent (25%) of the
grant amount vesting in each of the four years and will begin on the Effective Date. The Option Grant will be subject to the terms of the Company’s 2004 Equity Compensation Plan. 
  
 1.5 Incentive Compensation. The Executive shall participate in short-term and long-term incentive programs
established by the Company for its senior level executives generally, at levels determined by the Board or the Chief Executive Officer. Executive’s incentive compensation shall be subject to the terms of the applicable plans and shall be
determined based on Executive’s individual performance and Company performance as determined by the Board or the Chief Executive Officer. Executive’s bonus eligibility for 2005 shall be 35% of her base salary, subject to achievement of
goals to be mutually agreed upon by Executive and the Chief Executive Officer. 
  
 1.6 Retirement and Welfare Plans. Executive shall participate in employee retirement and welfare benefit plans made available to the Company’s senior level executives as a group or to its employees
generally, as such retirement and welfare plans may be in effect from time to time and subject to the eligibility requirements of the plans. Nothing in this Agreement shall prevent the Company from amending or terminating any retirement, welfare or
other employee benefit plans or programs from time to time as the Company deems appropriate. 
  
 Reimbursement of Expenses; Vacation. Executive shall be provided with reimbursement of reasonable expenses related to Executive’s employment by the Company on a basis no less favorable than that which may
be authorized from time to time for senior level executives as a group, and shall be entitled to four (4) weeks of vacation and three (3) personal days in accordance with the Company’s pay for time not worked policies. 
  
 2. Termination. Executive’s employment shall terminate upon the occurrence of any
of the following events: 
  
 2.1 Termination Without Cause
Before A Change of Control. 
  
 (a) The Company may remove
Executive at any time without Cause (as defined in Section 2.9) from the position in which Executive is employed hereunder upon not less than 30 days’ prior written notice to Executive. 
  
 (b) If Executive’s employment terminates as described in subsection (a)
above and Executive executes and does not revoke a written release upon such removal, in a form provided by the Company, of any and all claims against the Company and all related parties with respect to all matters arising out of Executive’s
employment by the Company, or the termination thereof (the “Release”), Executive shall be entitled to receive the following severance compensation, as long as Executive complies with the terms of Sections 4, 5, 6 and 7 below: 

 
 (i) Executive shall receive severance payments in an amount equal to
0.75 times Executive’s annual Base Salary at the rate in effect at the time of Executive’s 

  

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termination. The severance amount shall be paid in equal monthly installments over the nine-month period following Executive’s termination of employment
(the “Severance Period”). Monthly payments shall commence within 30 days after the effective date of the termination (or the end of the revocation period for the Release, if later). 
  
 (ii) During the Severance Period, Executive shall continue to receive the
medical coverage in effect at the date of Executive’s termination (or generally comparable coverage) for Executive and, where applicable, Executive’s spouse and dependents, as the same may be changed from time to time for employees
generally, as if Executive had continued in employment during such period; or, as an alternative, the Company may elect to pay Executive cash in lieu of such coverage in an amount equal to Executive’s COBRA cost of continuing such coverage
(less any required employee payments calculated as if Executive had continued to be an employee), where such coverage may not be continued (or where such continuation would adversely affect the tax status of the plan pursuant to which the coverage
is provided). The COBRA health care continuation coverage period under Section 4980B of the Internal Revenue Code of 1986, as amended (the “Code”), shall run concurrently with the Severance Period. 
  
 (iii) All outstanding stock options and stock awards held by Executive at
the date of Executive’s termination of employment that would have otherwise become vested and exercisable during the Severance Period will become vested and exercisable as if Executive had remained employed during the Severance Period.

  
 (iv) Executive shall receive any benefits accrued in
accordance with the terms of any applicable benefit plans and programs of the Company. 
  
 (v) Executive agrees that if Executive fails to comply with Section 4, 5, 6 or 7 below, all payments under this Section 2.1 shall immediately cease. 
  
 2.2 Termination Without Cause; Resignation for Good Reason After A Change of Control. 
  
 (a) If a Change of Control occurs and the Company terminates
Executive’s employment without Cause at any time upon or after a Change of Control or Executive resigns for Good Reason (as defined in Section 2.9) upon or at any time during the two-year period following the Change of Control, this Section 2.2
shall apply. 
  
 (b) If Executive’s employment terminates as
described in subsection (a) above and Executive executes and does not revoke a Release, Executive shall be entitled to receive the following severance compensation, as long as Executive complies with the terms of Sections 4, 5, 6 and 7 below:

  
 (i) Executive shall receive a lump sum severance payment in
an amount equal to (A) 1.25 times Executive’s annual Base Salary at the rate in effect at the time of Executive’s termination, plus (B) 1.25 times Executive’s average annual bonus paid by the Company to Executive for the two fiscal
years preceding Executive’s termination of employment. The payment shall be made within 30 days after the effective date of the termination of employment (or the end of the revocation period for the Release, if later). 
  

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 (ii) During the 15-month period following Executive’s termination of employment (the
“Severance Period”), Executive shall continue to receive the medical coverage in effect at the date of Executive’s termination (or generally comparable coverage) for Executive and, where applicable, Executive’s spouse and
dependents, as the same may be changed from time to time for employees generally, as if Executive had continued in employment during such period; or, as an alternative, the Company may elect to pay Executive cash in lieu of such coverage in an
amount equal to Executive’s COBRA cost of continuing such coverage (less any required employee payments calculated as if Executive had continued to be an employee), where such coverage may not be continued (or where such continuation would
adversely affect the tax status of the plan pursuant to which the coverage is provided). The COBRA health care continuation coverage period under Section 4980B of the Code, shall run concurrently with the Severance Period. 
  
 (iii) All outstanding stock options held by Executive at the date of
Executive’s termination of employment shall become fully exercisable on the date of termination and all stock awards held by Executive at the date of Executive’s termination of employment shall become fully vested and exercisable as of the
date of termination. 
  
 (iv) Executive shall receive any
benefits accrued in accordance with the terms of any applicable benefit plans and programs of the Company. 
  
 (c) Executive agrees that if Executive materially breaches Section 4, 5, 6 or 7 below, all payments under this Section 2.2 shall immediately cease.

  
 2.3 Increase in Payments Upon a Change of Control.

  
 (a) Anything in this Agreement to the contrary
notwithstanding, in the event that it shall be determined that any payment or distribution by the Company to or for the benefit of Executive, whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or
otherwise (a “Payment”), would constitute an “excess parachute payment” within the meaning of Section 280G of the Code, the Company shall pay to Executive an additional amount (the “Gross-Up Payment”) such that the net
amount retained by Executive after deduction of any excise tax imposed under Section 4999 of the Code, and any federal, state and local income tax, employment tax and excise tax imposed upon the Gross-Up Payment, shall be equal to the Payment. For
purposes of determining the amount of the Gross-Up Payment, unless Executive specifies that other rates apply, Executive shall be deemed to pay federal income tax and employment taxes at the highest marginal rate of federal income and employment
taxation in the calendar year in which the Gross-Up Payment is to be made and state and local income taxes at the highest marginal rate of taxation in the state and locality of Executive’s residence on Executive’s termination date, net of
the maximum reduction in federal income taxes that may be obtained from the deduction of such state and local taxes. 
  
 (b) All determinations to be made under this Section 2.3 shall be made by the Company’s independent public accountant immediately prior to the Change
of Control or by another independent public accounting firm mutually selected by the Company and Executive before the date of the Change of Control (the “Accounting Firm”), which firm shall provide its determinations and any supporting
calculations both to the Company and Executive within 20 

  

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days after Executive’s termination date. Any such determination by the Accounting Firm shall be binding upon the Company and Executive. Within 10 days
after the Accounting Firm’s determination, the Company shall pay the Gross-Up Payment to Executive. 
  
 (c) All of the fees and expenses of the Accounting Firm in performing the determinations referred to in this Section 2.3 shall be borne solely by the
Company. The Company agrees to indemnify and hold harmless the Accounting Firm from any and all claims, damages and expenses resulting from or relating to its determinations pursuant to this Section 2.3, except for claims, damages or expenses
resulting from the gross negligence or willful misconduct of the Accounting Firm. 
  
 2.4 Voluntary Termination. Executive may voluntarily terminate Executive’s employment for any reason upon 30 days’ prior written notice. In such event, after the effective date of such termination,
except as provided in Section 2.2 with respect to a resignation for Good Reason, no further payments shall be due under this Agreement, except that Executive shall be entitled to any benefits accrued in accordance with the terms of any applicable
benefit plans and programs of the Company. 
  
 2.5
Disability. The Company may terminate Executive’s employment if Executive has been unable to perform the material duties of Executive’s employment for a period of 90 days in any 12-month period because of physical or mental injury
or illness (“Disability”); provided, however, that the Company shall continue to pay Executive’s Base Salary until the Company acts to terminate Executive’s employment. Executive agrees, in the event of a dispute under this
Section 2.5 relating to Executive’s Disability, to submit to a physical examination by a licensed physician jointly selected by the Board and Executive. If the Company terminates Executive’s employment for Disability, no further payments
shall be due under this Agreement, except that Executive shall be entitled to any benefits accrued in accordance with the terms of any applicable benefit plans and programs of the Company. 
  
 2.6 Death. If Executive dies while employed by the Company, the
Company shall pay to Executive’s executor, legal representative, administrator or designated beneficiary, as applicable, any benefits accrued under the Company’s benefit plans and programs. Otherwise, the Company shall have no further
liability or obligation under this Agreement to Executive’s executors, legal representatives, administrators, heirs or assigns or any other person claiming under or through Executive. 
  
 2.7 Cause. The Company may terminate Executive’s employment at
any time for Cause (as defined in Section 2.9) upon written notice to Executive, in which event all payments under this Agreement shall cease. Executive shall be entitled to any benefits accrued before Executive’s termination in accordance with
the terms of any applicable benefit plans and programs of the Company. 
  
 2.8 Notice of Termination. Any termination of Executive’s employment shall be communicated by a written notice of termination to the other party hereto given in accordance with Section 11. The notice of termination shall (i)
indicate the specific termination provision in this Agreement relied upon, (ii) briefly summarize the facts and circumstances deemed to provide a basis for a termination of employment and the applicable provision hereof, and (iii) specify the
termination date in accordance with the requirements of this Agreement. 
  

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 2.9 Definitions. 
  
 (a) “Cause” shall mean any of the following grounds for termination of Executive’s employment:

  
 (i) Executive shall have been convicted of, or entered a
plea of guilty to, a felony, 
  
 (ii) Executive intentionally and
continually fails to perform Executive’s reasonably assigned material duties to the Company (other than a failure resulting from Executive’s incapacity due to physical or mental illness), which failure has continued for a period of at
least 30 days after a written notice of demand for substantial performance, signed by a duly authorized officer of the Company, has been delivered to Executive specifying the manner in which Executive has failed substantially to perform, 

 
 (iii) Executive engages in willful misconduct in the performance of
Executive’s duties, or 
  
 (iv) Executive materially
breaches Section 4, 5, 6 or 7 below. 
  
 (b) “Change of
Control” as used herein, a “Change of Control” shall be deemed to have occurred if: 
  
 (i) Any “person” (as such term is used in sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”)) becomes a “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing more than 50% of the voting power of the then outstanding securities of the
Company; provided that a Change of Control shall not be deemed to occur as a result of a transaction in which the Company becomes a subsidiary of another corporation and in which the stockholders of the Company, immediately prior to the transaction,
will beneficially own, immediately after the transaction, shares entitling such stockholders to more than 50% of all votes to which all stockholders of the parent corporation would be entitled in the election of directors; or 
  
 (ii) The consummation of (A) a merger or consolidation of the Company with
another corporation where the stockholders of the Company, immediately prior to the merger or consolidation, will not beneficially own, immediately after the merger or consolidation, shares entitling such stockholders to more than 50% of all votes
to which all stockholders of the surviving corporation would be entitled in the election of directors, (B) a sale or other disposition of all or substantially all of the assets of the Company, or (C) a liquidation or dissolution of the Company.

  
 (iii) After the Effective Date, directors are elected such
that a majority of the members of the Board shall have been members of the Board for less than two years, unless the election or nomination for election of each new director who was not a director at the beginning of such two-year period was
approved by a vote of at least two-thirds of the directors then still in office who were directors at the beginning of such period. 
  

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 (c) “Good Reason” shall mean the occurrence of any of the following events or
conditions, unless Executive has expressly consented in writing thereto, or except as a result of Executive’s physical or mental incapacity or as described in the last sentence of this subsection (c): 
  
 (i) a reduction in Executive’s Base Salary; 
  
 (ii) a substantial reduction of Executive’s duties and responsibilities
hereunder; or 
  
 (iii) the Company requires that
Executive’s principal office location be moved to a location more than 50 miles from Executive’s principal office location immediately before the change. 
  
 Notwithstanding the foregoing, Executive shall not have Good Reason for termination unless Executive gives written notice of termination for
Good Reason within 15 days after the event giving rise to Good Reason occurs and the Company does not correct the action or failure to act that constitutes the grounds for Good Reason, as set forth in Executive’s notice of termination, within
30 days after the date on which Executive gives written notice of termination. 
  
 3. Non-Exclusivity of Rights. Nothing in this Agreement shall prevent or limit Executive’s continuing or future participation in or rights under any benefit, bonus, incentive or other plan or program provided by the Company and
for which Executive may qualify; provided, however, that if Executive becomes entitled to and receives the payments provided for in Section 2 of this Agreement, Executive hereby waives Executive’s right to receive payments under any severance
plan or similar program applicable to all employees of the Company. 
  
 4.
Confidentiality. Executive agrees that Executive’s services to the Company and its subsidiaries and any successors or assigns (collectively, the “Employer”) were and are of a special, unique and extraordinary character, and
that Executive’s position places Executive in a position of confidence and trust with the Employer’s customers and employees. Executive also recognizes that Executive’s position with the Employer will give Executive substantial access
to Confidential Information (as defined below), the disclosure of which to competitors of the Employer would cause the Employer to suffer substantial and irreparable damage. Executive recognizes, therefore, that it is in the Employer’s
legitimate business interest to restrict Executive’s use of Confidential Information for any purposes other than the discharge of Executive’s employment duties at the Employer, and to limit any potential appropriation of Confidential
Information by Executive for the benefit of the Employer’s competitors and to the detriment of the Employer. Accordingly, Executive agrees as follows: 
  
 (a) Executive will not at any time, whether during or after the termination of Executive’s employment, reveal to any person or entity any of the
trade secrets or confidential information of the Employer or of any third party which the Employer is under an obligation to keep confidential (including but not limited to trade secrets or confidential information respecting inventions, products,
designs, methods, know-how, techniques, systems, processes, 

  

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software programs, works of authorship, customer lists, projects, plans and proposals) (“Confidential Information”), except as may be required in
the ordinary course of performing Executive’s duties as an employee of the Employer, and Executive shall keep secret all matters entrusted to Executive and shall not use or attempt to use any such information in any manner which may injure or
cause loss or may be calculated to injure or cause loss whether directly or indirectly to the Employer. 
  
 (b) The above restrictions shall not apply to: (i) information that at the time of disclosure is in the public domain through no fault of Executive; (ii)
information received from a third party outside of the Employer that was disclosed without a breach of any confidentiality obligation; (iii) information approved for release by written authorization of the Employer; or (iv) information that may be
required by law or an order of any court, agency or proceeding to be disclosed; provided Executive shall provide the Employer notice of any such required disclosure once Executive has knowledge of it and will help the Employer to the extent
reasonable to obtain an appropriate protective order. 
  
 (c)
Further, Executive agrees that during Executive’s employment Executive shall not take, use or permit to be used any notes, memoranda, reports, lists, records, drawings, sketches, specifications, software programs, data, documentation or other
materials of any nature relating to any matter within the scope of the business of the Employer or concerning any of its dealings or affairs otherwise than for the benefit of the Employer. Executive further agrees that Executive shall not, after the
termination of Executive’s employment, use or permit to be used any such notes, memoranda, reports, lists, records, drawings, sketches, specifications, software programs, data, documentation or other materials, it being agreed that all of the
foregoing shall be and remain the sole and exclusive property of the Employer and that, immediately upon the termination of Executive’s employment, Executive shall deliver all of the foregoing, and all copies thereof, to the Employer, at its
main office. 
  
 (d) Executive agrees that upon the termination of
Executive’s employment with the Employer, Executive will not take or retain without written authorization any documents, files or other property of the Employer, and Executive will return promptly to the Employer any such documents, files or
property in Executive’s possession or custody, including any copies thereof maintained in any medium or format. Executive recognizes that all documents, files and property which Executive has received and will receive from the Employer,
including but not limited to scientific research, customer lists, handbooks, memoranda, product specifications, and other materials (with the exception of documents relating to benefits to which Executive might be entitled following the termination
of Executive’s employment with the Employer), are for the exclusive use of the Employer and employees who are discharging their responsibilities on behalf of the Employer, and that Executive has no claim or right to the continued use,
possession or custody of such documents, files or property following the termination of Executive’s employment with the Employer. 
  
 5. Intellectual Property. 
  
 (a) If at any time or times during Executive’s employment Executive shall (either alone or with others) make, conceive, discover or reduce to
practice any invention, modification, discovery, design, development, improvement, process, software program, work of 

  

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authorship, documentation, formula, data, technique, know-how, secret or intellectual property right whatsoever or any interest therein (whether or not
patentable or registrable under copyright or similar statutes or subject to analogous protection) (herein called “Developments”) that (i) relates to the business of the Employer or any customer of or supplier to the Employer or any of the
products or services being developed, manufactured or sold by the Employer or which may be used in relation therewith, (ii) results from tasks assigned to Executive by the Employer or (iii) results from the use of premises or personal property
(whether tangible or intangible) owned, leased or contracted for by the Employer, such Developments and the benefits thereof shall immediately become the sole and absolute property of the Employer and its assigns, and Executive shall promptly
disclose to the Employer (or any persons designated by it) each such Development, and Executive hereby assigns any rights Executive may have or acquire in the Developments and benefits and/or rights resulting therefrom to the Employer and its
assigns without further compensation and shall communicate, without cost or delay, and without publishing the same, all available information relating thereto (with all necessary plans and models) to the Employer. 
  
 (b) Upon disclosure of each Development to the Employer, Executive will,
during Executive’s employment and at any time thereafter, at the request and cost of the Employer, sign, execute, make and do all such deeds, documents, acts and things as the Employer and its duly authorized agents may reasonably require:

  
 (i) to apply for, obtain and vest in the name of the
Employer alone (unless the Employer otherwise directs) letters patent, copyrights or other analogous protection in any country throughout the world and when so obtained or vested to renew and restore the same; and 
  
 (ii) to defend any opposition proceedings in respect of such applications
and any opposition proceedings or petitions or applications for revocation of such letters patent, copyright or other analogous protection. 
  
 (c) In the event the Employer is unable, after reasonable effort, to secure Executive’s signature on any letters patent, copyright or other analogous
protection relating to a Development, whether because of Executive’s physical or mental incapacity or for any other reason whatsoever, Executive hereby irrevocably designates and appoints the Employer and its duly authorized officers and agents
as Executive’s agent and attorney-in-fact, to act for and on Executive’s behalf and stead to execute and file any such application or applications and to do all other lawfully permitted acts to further the prosecution and issuance of
letter patents, copyright and other analogous protection thereon with the same legal force and effect as if executed by Executive. 
  
 6. Non-Competition. While Executive is employed at the Employer and for a period of one year after termination of Executive’s employment (for any reason
whatsoever, whether voluntary or involuntarily), Executive will not, without the prior written approval of the Board, whether alone or as a partner, officer, director, consultant, agent, employee or stockholder of any company or other commercial
enterprise, directly or indirectly engage in any business or other activity in the United States or Canada which competes with the Employer in the sale of the pharmaceutical or other products being manufactured, marketed, distributed or developed by
the 

  

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Employer while Executive is employed by Employer and at the time of termination of such employment. The foregoing prohibition shall not prevent
Executive’s employment or engagement after termination of Executive’s employment by any company or business organization, as long as the activities of any such employment or engagement, in any capacity, do not involve work on matters
related to the products being developed, manufactured, or marketed by the Employer at the time of termination of Executive’s employment. Executive shall be permitted to own securities of a public company not in excess of five percent of any
class of such securities and to own stock, partnership interests or other securities of any entity not in excess of five percent of any class of such securities and such ownership shall not be considered to be in competition with the Employer.

  
 7. Non-Solicitation. 
  
 (a) While Executive is employed at the Employer and for a period of one (1)
year after termination of such employment (for any reason, whether voluntary or involuntarily), Executive agrees that Executive will not: 
  
 (i) directly or indirectly solicit, entice or induce any customer to become a customer of any other person, firm or corporation with respect to products
then sold or under development by the Employer or to cease doing business with the Employer, and Executive shall not approach any such person, firm or corporation for such purpose or authorize or knowingly approve the taking of such actions by any
other person; or 
  
 (ii) directly or indirectly solicit or
recruit any employee of the Employer to work for a third party other than the Employer (excluding newspaper or similar print or electronic solicitations of general circulation). 
  
 (b) This Section 7 does not apply to any general solicitation not focused to any group of customers itemized on a customer
list of the Employer. 
  
 8. General Provisions. 
  
 (a) Executive acknowledges and agrees that the type and periods of
restrictions imposed in Sections 4, 5, 6 and 7 of this Agreement are fair and reasonable, and that such restrictions are intended solely to protect the legitimate interests of the Employer, rather than to prevent Executive from earning a livelihood.
Executive recognizes that the Employer competes worldwide, and that Executive’s access to Confidential Information makes it necessary for the Employer to restrict Executive’s post-employment activities in any market in which the Employer
competes, and in which Executive’s access to Confidential Information and other proprietary information could be used to the detriment of the Employer. In the event that any restriction set forth in this Agreement is determined to be overbroad
with respect to scope, time or geographical coverage, Executive agrees that such a restriction or restrictions should be modified and narrowed, either by a court or by the Employer, so as to preserve and protect the legitimate interests of the
Employer as described in this Agreement, and without negating or impairing any other restrictions or agreements set forth herein. 
  
 (b) Executive acknowledges and agrees that if Executive should breach any of the covenants, restrictions and agreements contained herein, irreparable loss
and injury would 

  

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result to the Employer, and that damages arising out of such a breach may be difficult to ascertain. Executive therefore agrees that, in addition to all
other remedies provided at law or at equity, the Employer shall be entitled to have the covenants, restrictions and agreements contained in Sections 4, 5, 6, and 7 specifically enforced (including, without limitation, by temporary, preliminary, and
permanent injunctions and restraining orders) by any state or federal court in the Commonwealth of Pennsylvania having equity jurisdiction and Executive agrees to subject Executive to the jurisdiction of such court. 
  
 (c) Executive agrees that if the Employer fails to take action to remedy any
breach by Executive of this Agreement or any portion of the Agreement, such inaction by the Employer shall not operate or be construed as a waiver of any subsequent breach by Executive of the same or any other provision, agreement or covenant.

  
 (d) Executive acknowledges and agrees that the payments and
benefits to be provided to Executive under this Agreement are provided as consideration for the covenants in Sections 4, 5, 6, and 7 hereof. 
  
 9. Survivorship. The respective rights and obligations of the parties under this Agreement shall survive any termination of Executive’s employment to the
extent necessary to the intended preservation of such rights and obligations. 
  
 10. Mitigation. Executive shall not be required to mitigate the amount of any payment or benefit provided for in this Agreement by seeking other employment or otherwise and there shall be no offset against amounts due Executive under
this Agreement on account of any remuneration attributable to any subsequent employment that Executive may obtain. 
  
 11. Notices. All notices and other communications required or permitted under this Agreement or necessary or convenient in connection herewith shall be in writing
and shall be deemed to have been given when hand delivered or mailed by registered or certified mail, as follows (provided that notice of change of address shall be deemed given only when received): 
  
 If to the Company, to: 
  
 Auxilium Pharmaceuticals, Inc. 
 Norriton Office Center 
 160 West Germantown
Pike 
 Norristown, PA 19401 
  
 If to Executive, to: 
  
 Jennifer Evans Stacey 
 241 Biddulph Road

 Radnor, PA 19087 
  
 or to such other names or addresses as the Company or Executive, as the case may be, shall designate by notice to each other person entitled to receive notices in the
manner specified in this Section. 
  

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 12. Contents of Agreement; Amendment and Assignment. 
  
 (a) This Agreement sets forth the entire understanding between the parties
hereto with respect to the subject matter hereof and supercedes any and all prior agreements and understandings concerning Executive’s employment by the Company, including that certain offer letter between the Company and Executive, dated as of
January 24, 2005, and cannot be changed, modified, extended or terminated except upon written amendment approved by the Board and executed on its behalf by a duly authorized officer and by Executive. 
  
 (b) All of the terms and provisions of this Agreement shall be binding upon
and inure to the benefit of and be enforceable by the respective heirs, executors, administrators, legal representatives, successors and assigns of the parties hereto, except that the duties and responsibilities of Executive under this Agreement are
of a personal nature and shall not be assignable or delegatable in whole or in part by Executive. The Company shall require any successor (whether direct or indirect, by purchase, merger, consolidation, reorganization or otherwise) to all or
substantially all of the business or assets of the Company, within 15 days of such succession, expressly to assume and agree to perform this Agreement in the same manner and to the same extent as the Company would be required to perform if no such
succession had taken place. 
  
 13. Severability. If any provision of this
Agreement or application thereof to anyone or under any circumstances is adjudicated to be invalid or unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect any other provision or application of this Agreement which
can be given effect without the invalid or unenforceable provision or application and shall not invalidate or render unenforceable such provision or application in any other jurisdiction. If any provision is held void, invalid or unenforceable with
respect to particular circumstances, it shall nevertheless remain in full force and effect in all other circumstances. 
  
 14. Remedies Cumulative; No Waiver. No remedy conferred upon a party by this Agreement is intended to be exclusive of any other remedy, and each and every such
remedy shall be cumulative and shall be in addition to any other remedy given under this Agreement or now or hereafter existing at law or in equity. No delay or omission by a party in exercising any right, remedy or power under this Agreement or
existing at law or in equity shall be construed as a waiver thereof, and any such right, remedy or power may be exercised by such party from time to time and as often as may be deemed expedient or necessary by such party in its sole discretion.

  
 15. Withholding. All payments under this Agreement shall be made
subject to applicable tax withholding, and the Company shall withhold from any payments under this Agreement all federal, state and local taxes as the Company is required to withhold pursuant to any law or governmental rule or regulation. Except as
otherwise provided by Section 2.3, Executive shall bear all expense of, and be solely responsible for, all federal, state and local taxes due with respect to any payment received under this Agreement. 
  

 12 

 16. Miscellaneous. This Agreement may be executed in counterparts, each of which is an original. It shall not be
necessary in making proof of this Agreement or any counterpart hereof to produce or account for any of the other counterparts. 
  
 17. Governing Law. This Agreement shall be governed by and interpreted under the laws of the Commonwealth of Pennsylvania without giving effect to any conflict of
laws provisions or canons of construction that construe agreements against the draftsperson. 
  

 13 

 IN WITNESS WHEREOF, the undersigned, intending to be legally bound, have executed this Agreement as of
the date first above written. 
  

			
	 AUXILIUM PHARMACEUTICALS, INC.

		
	 By:
	 	 /s/    GERRI A.
HENWOOD        

	 Name:
	 	Gerri A. Henwood
	 Title:
	 	Chief Executive Officer and Interim President
	
	 EXECUTIVE

	
	 /s/    JENNIFER EVANS
STACEY        

	JENNIFER EVANS STACEY

  

 14Form of Consultant warrant

 Exhibit 4.7 
  

FORM OF CONSULTANT WARRANT 
  
 THE SECURITIES EVIDENCED BY THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED UNLESS THERE
IS AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT COVERING SUCH SECURITIES, THE SALE IS MADE IN ACCORDANCE WITH RULE 144 UNDER THE ACT, OR THE COMPANY RECEIVES AN OPINION OF COUNSEL FOR THE HOLDER OF SUCH SECURITIES REASONABLY SATISFACTORY TO
THE COMPANY STATING THAT SUCH SALE, TRANSFER, OR ASSIGNMENT IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT. 
  
 No. 2004-W-[    ] 
  
 WARRANT TO PURCHASE                     
SHARES 
 OF COMMON STOCK OF 
 DAYSTAR TECHNOLOGIES, INC. 
 (void after
                                 , 2014) 
  
 This certifies that
                                , the registered holder (the “Holder”),
is entitled to purchase from DAYSTAR TECHNOLOGIES, INC., a Delaware corporation (the “Company”),              fully paid and nonassessable shares of the Company’s
Common Stock, $0.01 par value per share (the “Common Stock”), subject to adjustment as provided herein, at any time or from time to time up to and including 5:00 p.m. (Pacific Time) on
                                 , 2014, such date being referred to herein
as the “Expiration Date,” upon surrender to the Company of this Warrant properly endorsed with the Notice of Exercise and Investment Representation Statement attached hereto duly filled in and signed, and upon payment of the purchase price
for the number of shares for which this Warrant is being exercised times a per share purchase price of $             per share (referred to herein as the “Stock Purchase
Price”). The per share Stock Purchase Price and the number of shares purchasable hereunder are subject to adjustment as provided herein. 
  
 This Warrant is subject to the following terms and conditions: 
  

	 	1.	Exercise; Issuance of Certificates; Payment for Shares. 

  
 This Warrant is exercisable at the option of the Holder, at any time or from time to time, up to and including the Expiration Date, for all or any part of
the shares of Common Stock which may be purchased hereunder. Shares of Common Stock purchased under this Warrant will be issued to the Holder as the record owner of such shares as of the close of business on the date on which this Warrant is
surrendered, properly endorsed, together with the completed Notice of Exercise and Investment Representation Statement in the forms attached hereto and payment, by certified or bank check or wire transfer of an amount equal to the Stock Purchase
Price per share multiplied by the number of shares being purchased. Certificates for the shares of Common Stock so purchased will be delivered to the Holder by the Company at the 

 
Company’s expense within a reasonable time after this Warrant has been so exercised, and will bear a legend relating to the transferability of shares of
Common Stock under the Securities Act of 1933 and state securities laws. Each stock certificate so delivered will be in such denominations of Common Stock as may be requested by the Holder and will be registered in the name of such Holder. In case
of a purchase of fewer than all the shares which may be purchased under this Warrant, the Company will cancel this Warrant and execute and deliver to the Holder within a reasonable time a new Warrant or Warrants of like tenor representing the
portion of the shares, if any, with respect to which this Warrant shall not then have been exercised. 
  

	 	2.	Shares to be Fully Paid; Reservation of Shares. 

  
 The Company covenants and agrees that all shares of Common Stock which may be issued upon the exercise of the rights represented by this Warrant will,
upon issuance, be duly authorized, validly issued, fully paid and nonassessable and free from all preemptive rights of any shareholder and free of all taxes, liens and charges with respect to the issue thereof. The Company further covenants and
agrees that during the period within which the rights represented by this Warrant may be exercised, a sufficient number of shares of authorized but unissued Common Stock will be reserved to provide for the exercise of the rights represented by this
Warrant. The Company will take all such action as may be necessary to assure that such shares may be issued as provided herein without violation of any applicable law or regulation, or of any requirements of any domestic securities exchange upon
which the Company’s Common Stock may be listed. 
  

	 	3.	Adjustment of Stock Purchase Price and Number of Shares. 

  
 In case the Company splits or subdivides its outstanding shares of Common Stock into a greater number of shares, the Stock Purchase Price in effect
immediately prior to such subdivisions will be proportionately reduced and, conversely, in case the outstanding shares of the Common Stock of the Company are combined into a smaller number of shares, the Stock Purchase Price in effect immediately
prior to such combination will be proportionately increased. Upon each adjustment of the Stock Purchase Price, the Holder of this Warrant will thereafter be entitled to purchase, at the Stock Purchase Price resulting from such adjustment, the number
of shares, rounded to the nearest whole share, obtained by multiplying the Stock Purchase Price in effect immediately prior to such adjustment by the number of shares purchasable pursuant hereto immediately prior to such adjustment, and dividing the
product thereof by the Stock Purchase Price resulting from such adjustment. 
  
 Upon any adjustment of the Stock Purchase Price or any increase or decrease in the number of shares purchasable upon the exercise of this Warrant, the Company will give written notice thereof, by first-class mail,
postage prepaid, addressed to the registered Holder of this Warrant at the address of such Holder as shown on the books of the Company. The notice will be signed by the Company’s President or Chief Financial Officer and will set forth the Stock
Purchase Price resulting from such adjustment and the increase or decrease, if any, in the number of shares purchasable at such price upon the exercise of this Warrant, setting forth in reasonable detail the method of calculation and the facts upon
which such calculation is based. 
  

 2 

	 	4.	Notice of Certain Events. 

  
 If at any time: 
  
 (a) the Company declares any dividend upon its Common Stock payable in stock or makes any special dividend or other distribution to the holders of its
Common Stock; 
  
 (b) there is to be any capital reorganization
or reclassification of the capital stock of the Company; or consolidation or merger of the Company with, or sale of all or substantially all of its assets to, another corporation; or 
  
 (c) there is to be a voluntary or involuntary dissolution, liquidation or winding up of the Company; 
  
 then, in any one or more of such cases, the Company will give, by first-class mail, postage
prepaid, addressed to the Holder of this Warrant at the address of such Holder as shown on the books of the Company (i) at least 10 days’ prior written notice of the date on which the books of the Company will close or a record will be taken
for such dividend or distribution or for determining rights to vote in respect of any such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding up, and (ii) in the case of any such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation, or winding up, at least 10 days’ prior written notice of the date when the same will take place. Any notice given in accordance with the foregoing clause (i) will also
specify, in the case of any such dividend or distribution, the date on which a shareholder will be entitled thereto. Any notice given in accordance with the foregoing clause (ii) will also specify the date on which shareholders will be entitled to
exchange their shares for securities or other property deliverable upon such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding up, as the case may be. 
  

	 	5.	No Shareholder, Voting or Dividend Rights. 

  
 Nothing in this Warrant will be construed as conferring upon the Holder, by virtue of ownership of the Warrant, any rights of a shareholder of the
Company, including without limitation the right to vote or to consent to receive notice as a shareholder of the Company or any other matters or any rights whatsoever as a shareholder of the Company. No dividends or interest will be payable or
accrued in respect of this Warrant or the interest represented hereby or the shares purchasable hereunder until, and only to the extent that, this Warrant will have been exercised and the shares purchasable upon the exercise hereof shall have become
deliverable, as provided herein. 
  

	 	6.	Fractional Shares. 

  
 No fractional shares will be issued upon exercise of this Warrant. The Company will, in lieu of issuing any fractional share, pay the holder entitled to
such fraction a sum in cash equal to such fraction multiplied by the Stock Purchase Price per share then in effect. 
  

 3 

	 	7.	Restrictions on Transfer. 

  
 This Warrant may not be sold, transferred, assigned or hypothecated. This Warrant may be divided or combined, upon request to the Company by the Holder,
into a certificate or certificates evidencing the same aggregate number of Warrants. 
  

	 	8.	Applicable Law. 

  
 This Warrant will be governed by and construed in accordance with the laws of the State of Delaware, without reference to conflict of laws principles
thereunder. All disputes relating to this Warrant shall be tried before the courts of New York located in Saratoga County, New York to the exclusion of all other courts that might have jurisdiction. 
  

	 	9.	Saturdays, Sundays or Holidays. 

  
 If the Expiration Date falls on a Saturday, Sunday or Holiday, the Expiration Date will be extended until the next business day. 
  

	 	10.	Miscellaneous. 

  
 The headings in this Warrant are for purposes of convenience and reference only, and will not be deemed to constitute a part hereof. Neither this Warrant
nor any term hereof may be changed or waived orally, but only by an instrument in writing signed by the Company and the Holder of this Warrant. 
  
 IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by its officers, thereunto duly authorized, this
             day of August, 2004. 
  

			
	DAYSTAR TECHNOLOGIES, INC.
		
	By	 	 
	 	 	 Stephen A. Aanderud
 Chief Financial Officer

  

 4 

 NOTICE OF EXERCISE 
  

	TO:	DayStar Technologies, Inc. 

 13 Corporate Drive 

HalfMoon, New York 12065 
  
 The undersigned hereby elects to purchase
                     shares of the Common Stock of DayStar Technologies, Inc., pursuant to the terms of the attached Warrant, and tenders
herewith payment of the purchase price in full, together with all applicable transfer taxes, if any. 
  
 Please issue a certificate or certificates representing said shares of warrant stock in the name of the undersigned: 
  

					
			
	 	 	 	 	 
	 	 	
 (Name)
	 	 
			
	 	 	 	 	 
	 	 	
 (Address)
	 	 

  

			
		
	
 (Date)
	  	
 (Name of Warrant Holder)

		
	 	  	
 By:

		
	 	  	
 Title:

 INVESTMENT REPRESENTATION STATEMENT 
  
 Shares of the Common Stock 
 (as defined in the attached Warrant) of 
 DayStar Technologies, Inc. 
  
 In connection with the purchase of the above-listed securities, the
undersigned hereby represents to DayStar Technologies, Inc., a Delaware corporation (the “Company”), as follows: 
  
 (a)    The securities to be received upon the exercise of the Warrant (the “Securities”) will be acquired for investment for
its own account, not as a nominee or agent, and not with a view to the sale or distribution of any part thereof, and the undersigned has no present intention of selling, granting participation in or otherwise distributing the same, but subject,
nevertheless, to any requirement of law that the disposition of its property shall at all times be within its control. By executing this Statement, the undersigned further represents that it does not have any contract, undertaking, agreement or
arrangement with any person to sell, transfer, or grant participation to such person or to any third person, with respect to any Securities issuable upon exercise of the Warrant. 
  
 (b)    The undersigned understands that the Securities issuable upon exercise of the Warrant at the time
of issuance may not be registered under the Securities Act of 1933, as amended (the “Act”), and applicable state securities laws, on the ground that the issuance of such securities is exempt pursuant to Section 4(2) of the Act and state
law exemptions relating to offers and sales not by means of a public offering, and that the Company’s reliance on such exemptions is predicated on the undersigned’s representations set forth herein. 
  
 (c)    The undersigned agrees that in no event will it
make a disposition of any Securities acquired upon the exercise of the Warrant unless and until (i) it shall have notified the Company of the proposed disposition and shall have furnished the Company with a statement of the circumstances surrounding
the proposed disposition, and (ii) it shall have furnished the Company with an opinion of counsel reasonably satisfactory to the Company to the effect that (A) appropriate action necessary for compliance with the Act and any applicable state
securities laws has been taken or an exemption from the registration requirements of the Act and such laws is available, and (B) the proposed transfer will not violate any of said laws. 
  
 (d)    The undersigned acknowledges that an investment in the Company is highly speculative and
represents that it is able to fend for itself in the transactions contemplated by this Statement, has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of its investments, and has the
ability to bear the economic risks (including the risk of a total loss) of its investment. The undersigned represents that it has had the opportunity to ask questions of the Company concerning the Company’s business and assets and to obtain any
additional information which it considered necessary to verify the accuracy of or to amplify the Company’s disclosures, and has had all questions which have been asked by it satisfactorily answered by the Company. 
  

 6 

 (e)    The undersigned acknowledges that the Securities issuable upon exercise of the
Warrant must be held indefinitely unless subsequently registered under the Act or an exemption from such registration is available. The undersigned is aware of the provisions of Rule 144 promulgated under the Act which permit limited resale of
shares purchased in a private placement subject to the satisfaction of certain conditions, including, among other things, the existence of a public market for the shares, the availability of certain current public information about the Company, the
resale occurring not less than one year after a party has purchased and paid for the security to be sold, the sale being through a “broker’s transaction” or in transactions directly with a “market makers” (as provided by
Rule 144(f)) and the number of shares being sold during any three-month period not exceeding specified limitations. 
  

			
		
	Dated:                                   
 	  	 
		
	 	  	 
	 	  	
 (Typed or Printed Name)

		
	 	  	By:                                      
                                        
                  
	 	  	(Signature)
		
	 	  	
 (Title)

  

 7

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