Document:

Development and License Agreement - Alpharma Ireland Limited

 Exhibit 10.52 
 Confidential treatment has been requested for portions of this exhibit. The copy filed herewith omits the information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has
been filed separately with the Securities and Exchange Commission. 
 DEVELOPMENT AND LICENSE AGREEMENT 
 BETWEEN 
 DURECT CORPORATION 

 AND 
 ALPHARMA
IRELAND LIMITED 
 DATED AS OF 
 SEPTEMBER 19, 2008 
 CONFIDENTIAL 

 Confidential treatment has been requested for portions of this exhibit. The copy filed herewith omits the information
subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
 DEVELOPMENT AND LICENSE AGREEMENT 
 THIS DEVELOPMENT AND LICENSE AGREEMENT (this
“Agreement”), dated September 19, 2008 (“Execution Date”), is entered into by and between Durect Corporation, a corporation organized and existing under the laws of the State of Delaware, U.S.A. with a place of
business at 2 Results Way, Cupertino, CA 95014 (“Durect”), and Alpharma Ireland Limited, a corporation organized and existing under the laws of Ireland, having its registered office at Arthur Cox Building, Earlsfort Terrace, Dublin
2, Ireland (“Alpharma”). 
 PRELIMINARY STATEMENTS 
 A. Durect is the owner of a proprietary product for pain treatment consisting of a bupivacaine transdermal patch as described below and certain patents
and know-how relating thereto; 
 B. Durect desires to have such product further developed and commercialized in the territory specified
below; 
 C. Alpharma has capabilities in the development, manufacture, promotion, marketing and sales of pharmaceutical products in the
field of pain treatment in the specified territory; and 
 D. Durect desires to grant certain exclusive rights to Alpharma in respect of such
product in the specified territory and related matters upon the terms and conditions hereinafter set forth. 
 AGREEMENT 
 NOW THEREFORE, in consideration of the mutual covenants and agreements provided herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, hereby agree as follows: 
  

	1.	DEFINITIONS. 

 As used in this Agreement, the
following terms shall have the meanings set forth in this Section 1: 
 1.1 “ANDA” means an abbreviated new drug
application pursuant to Section 505(j) of the FDC Act. 
  

					
	CONFIDENTIAL	  	1	  	

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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 1.2 “Affiliate” means, with respect to a Person, any Person that controls, is
controlled by or is under common control with such first Person. For purposes of this definition only, “control” means (a) to possess, directly or indirectly, the power to direct the management or policies of a Person, whether through
ownership of voting securities, by contract relating to voting rights or corporate governance, or (b) to own, directly or indirectly, fifty percent (50%) or more of the outstanding voting securities or other ownership interest of such
Person. An entity will be an Affiliate for purposes of this Agreement only so long as it satisfies the definition set forth herein. 
 1.3
“Applicable Laws” means the applicable laws, rules and regulations, including any rules, regulations, guidelines or other requirements of the Health Authorities, that may be in effect from time to time. 
 1.4 [* * *] 
 1.5
“Bupivacaine” means 1-butyl-N-(2,6-dimethylphenyl) piperidine-2-carboxamide, including any and all pharmaceutically acceptable salts, solvates, prodrugs, esters, free base forms, enantiomers (and racemic or other mixtures of said
enantiomers) thereof. 
 1.6 “cGMP” means current Good Manufacturing Practice for medicinal products for human use as set
forth in U.S. Code of Federal Regulations 21 CFR Part 210, 211 et seq., Commission Directive 2003/94/EC the EU Good Manufacturing Practice guideline, Volume 4 for medicinal products for Human and Veterinary Use, the European Pharmacopoeia,
and equivalent thereof, as applicable, each as amended from time to time. 
 1.7 “Change of Control” means, as to Alpharma
or Durect, the occurrence of a tender offer, stock purchase, other stock acquisition, merger, consolidation, recapitalization, reverse split, sale or transfer of assets or other transaction, or series of transactions, as a result of which any
person, entity or group, other than an Affiliate of Alpharma or Durect, as the case may be, prior to the occurrence of such event (a) becomes the beneficial owner, directly or indirectly, of securities of Alpharma or Durect, as the case may be,
representing more than 50% of the 

  

					
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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 
ordinary shares of Alpharma or Durect, as the case may be, or representing more than 50% of the combined voting power with respect to the election of
directors of Alpharma or Durect, as the case may be, (b) obtains the ability to appoint a majority of the board of directors of Alpharma or Durect, as the case may be, or (c) obtains the ability to direct the operations or management of
Alpharma or Durect, as the case may be. 
 1.8 “Clinical Trial” means an investigation in human subjects and/or patients
intended to discover or verify the clinical, pharmacological and/or other pharmacodynamic effects of an investigational product(s), and/or to identify any adverse reactions to an investigational product(s), and/or to study absorption, distribution,
metabolism, and/or excretion of an investigational product(s) with the objective of ascertaining its safety, activity and/or efficacy. 
 1.9
“Collaboration Inventions” means all Know-How (whether or not patentable) conceived and/or reduced to practice by or for a Party, or any Affiliate, subcontractor, agent, or sublicensee thereof, or jointly by any of the foregoing,
arising out of or in connection with performing the activities under this Agreement, including the Development Plan. For clarity, and notwithstanding the foregoing, the definition of “Collaboration Inventions” shall not be construed to
cover Development Data. 
 1.10 “CMC” means chemistry, manufacturing and controls. 
 1.11 “CMC Data” means CMC data generated with respect to the Product that is Controlled at any time during the Term of this Agreement by
a Party, or any Affiliate, subcontractor, agent, sublicensee thereof, or jointly by any of the foregoing. 
 1.12 “CMO”
means a Third Party contract manufacturing organization. 
 1.13 “Committee” means any of the Joint Executive Committee
(JEC) or the Joint Development Committee (JDC), and when used in the plural, shall mean all of them or more than one of them, as the case may be. 
 1.14 “Commercialization” or “Commercialize” means the ongoing process and activities generally engaged in by a company marketing human pharmaceutical therapeutic products to establish and maintain a
presence for such product in a given territory, including offering for sale, selling, marketing, promoting, distributing, importing and exporting such product. 
  

					
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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 1.15 “Commercially Reasonable Efforts” with respect to any activity means the
efforts and resources that would be used by a specialty pharmaceutical company of comparable size and resources as Alpharma in the development, registration, Reimbursement authorization, market launch and/or manufacturing, with regard to a product
at a similar stage in its product life taking into account the following factors to the extent reasonable and relevant: issues of safety and efficacy, product profile, market potential, difficulty in manufacturing the product, difficulty in
establishing an appropriate clinical protocol for applicable indications, competitive market conditions, the patent, duration of regulatory exclusivity or other proprietary position of the product, the regulatory structure involved and the potential
profitability and economic return of the product [* * *], all as measured by the facts and circumstances at the time such efforts are due. Where this Agreement requires Alpharma to use Commercially Reasonable Efforts, such efforts and resources that
are used by Alpharma’s Affiliates and sublicensees shall also be attributed to Alpharma. 
 1.16 “Competitive Product”
means any formulation containing Bupivacaine, either alone or in combination with one or more other active ingredients, for transdermal delivery from a patch for use in the Field, other than the Product. 
 1.17 “Control” or “Controlled” means possession by a Party or its Affiliate of the right to grant to the other Party a
license, sublicense or other right to use, of the scope provided for in this Agreement, to Intellectual Property Rights (including patent rights, Know-How, trade secrets), data and rights to access or cross-reference regulatory filings without
violating the terms of any Applicable Law, agreement or other arrangement with any Third Party existing at the time such Party or such Affiliate would be first required hereunder to grant the other Party such license, sublicense or other right.

 1.18 [* * *] 
 1.19 [* * *]

 1.20 “Cost” means all internal and external costs, expenses, cost of labor and materials associated with an activity.

 1.21 “Development Data” means all Preclinical, Non-Clinical and Clinical data and all CMC Data, including
pharmacological, pharmacokinetic and toxicological data generated with 

  

					
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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 
respect to the Product that is Controlled at any time during the Term of this Agreement by a Party, or any Affiliate, subcontractor, agent, sublicensee
thereof, or jointly by any of the foregoing. 
 1.22 “Dollars” means U.S. Dollars, the lawful currency of the United States.

 1.23 “Dosage Form Development” means any pharmaceutical development activities for the Product that are necessary to
design or modify a pharmaceutical formulation or dosage form to meet the desired clinical or commercial product profile, including in vitro studies on solubility, stability, physical and chemical characteristics, denaturation, particle
formation, crystallization, micronization, excipient/material selection, compounding, mixing, casting, converting, drying, and similar activities. 
 1.24 “Durect Development Costs” shall mean the Costs incurred by Durect in performing the Durect Development Responsibilities as calculated in accordance with Schedule 1.24. 
 1.25 “Durect Trademark” means the trademark rights to the mark ELADURTM and similar rights under the laws of any Governmental
Entity, including all goodwill associated therewith, and all applications, registrations, extensions and renewals relating thereto. 
 1.26
“EMEA” means the European Medicines Agency, and where and if applicable, the European Commission, the Council of the European Union and the Committee for Medicinal Products for Human Use or any successors thereto. 
 1.27 “EU” shall mean the European Union, including each of the member states as modified from time to time. 
 1.28 [* * *] 
 1.29 [* * *] 
 1.30 [* * *]. 
 1.31 [* * *] 
 1.32 “FDA” means the Food and Drug Administration of the United States Department of Health and Human Services or any successor agency
thereof performing similar functions. 
  

					
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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 1.33 “FDC Act” means the United States Federal Food, Drug, and Cosmetic Act and any
successor acts thereto, as amended from time to time. 
 1.34 “Field” means all pharmaceutical applications (including the
treatment of pain) for human health. 
 1.35 “First Commercial Sale” means: (i) with respect to a Jurisdiction, the
first sale for use, consumption or resale of Product by Alpharma or an Affiliate or Sublicensee thereof to a Third Party in a bona fide arms’-length transaction in such Jurisdiction and (ii) with respect to the Territory, the First
Commercial Sale in any Jurisdiction. A sale to an Affiliate shall not constitute a First Commercial Sale unless the Affiliate is the end-user of the Product. 
 1.36 “GAAP” means generally accepted accounting principles in the United States, consistently applied by the Party at issue. 
 1.37 “Generic Product” means a generic pharmaceutical Bupivacaine transdermal patch that is approved for the same labeled indication as
the Product under an ANDA pursuant to the FDC Act, Article 10 of the EU Directive 2001/83/EC or other equivalent registration process under the Applicable Laws of the relevant Jurisdiction in which the Product is cited as the reference listed drug.

 1.38 “Governmental Entity” means any regional, central, federal, state, provincial or local court, commission or
governmental, regulatory or administrative body, board, bureau, agency, instrumentality, authority or tribunal or any subdivision thereof. 
 1.39 “HSR” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. 
 1.40 “ICH
Guidelines” means the then-current guidelines applicable to pharmaceutical products adopted by the International Conference on Harmonization. 
 1.41 “IND” means an investigational new drug application (together with all subsequent submissions, supplements and amendments thereto, and any materials, documents or information referred to or
relied upon thereby) filed with a Regulatory Authority in conformance with applicable laws and regulations, and the equivalent thereof (or other right to commence Clinical Trials), as applicable, in Jurisdictions outside the United States.

  

					
	CONFIDENTIAL	  	6	  	

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

 1.42 “Intellectual Property Rights” means patents, copyrights, trade secrets,
database rights, proprietary know-how and similar rights of any type (excluding trademarks) under the laws of any Governmental Entity, including all applications, registrations, extensions and renewals relating to any of the foregoing. 

1.43 “Jurisdiction” means a country within the Territory. 
 1.44 “Know-How” means all technical information and other technical subject matter, proprietary methods, ideas, concepts, formulations,
discoveries, inventions, devices, technology, trade secrets, compositions, designs, formulae, know-how, show-how, specifications, drawings, techniques, results, processes, methods, procedures and/or designs, whether or not patentable. 
 1.45 “Knowledge” means the actual knowledge of a Party’s executive officers. 
 1.46 “Manufacturing Technology” means all Know-How Controlled by a Party or any of its Affiliates that pertains to the manufacture,
finishing, or packaging of the Product, including any analytical methods and other quality control and assurance methods (including all processes, procedures, and techniques). 
 1.47 “MAA” means a “Marketing Authorization Application” or other application for approval to market the Product in a
Jurisdiction in the EU submitted to the Governmental Entity of such Jurisdiction, including any Marketing Authorization, as amended or supplemented from time to time. 
 1.48 “Marketing Authorization” or “MA” means any registrations or authorizations issued under Directive 2001/83/EC (as amended by Directive 2004/27) or local legislation deriving
thereof, Council Regulation 726/04 and any amendments or replacements thereof or any national equivalents in relation to the Product. 
 1.49
“Marketing Exclusivity Right” means a marketing or data exclusivity right conferred as a result of (a) designation as a drug for rare diseases or conditions under Sections 525 et seq. of the FDC Act, (b) an
exclusive right to sell under an NDA pursuant to Section 505(j)(5)(F)(ii), (iii) and (iv) or 505(c)(3)(E)(ii), (iii) and (iv) of the FDC Act or any relevant subsequent legislation, rules or regulations, (c) the
exclusive right granted by the FDA upon completion of pediatric studies requested by the FDA under Section 505A(a) of the FDC Act, (d) Article 10 of EU Directive 2001/83/EC and/or Article 3(3) of EU Regulation 726/2004/EC or (e)

  

					
	CONFIDENTIAL	  	7	  	

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

 
EU Regulations 141/2000/EC and/or 847/2000/E, as applicable, or any equivalent or similar rights in the Territory or Jurisdiction, successor legislations of
any of the foregoing or subsequent legislation that has the effect of extending marketing or data exclusivity right to a pharmaceutical product. 
 1.50 “NDA” means a “New Drug Application,” or other application for Regulatory Approval to market a product in the U.S. submitted to the FDA as amended or supplemented from time to time. 
 1.51 “Non-Clinical” when used with respect to studies or data refers to safety, toxicology and other studies undertaken in non-human
animals in support of Clinical Trials or otherwise required for Regulatory Approval. 
 1.52 “Net Sales” means the gross
amount invoiced by Alpharma, and/or its Affiliates and Sublicensees for sale or other commercial disposition of the Product (in its final, finished form for use by the end-user) to an unrelated Third Party in arms’-length transactions, less the
following deductions which are actually incurred, allowed, accrued or specifically allocated in their normal and customary amounts: (i) credits, price adjustments (including co-pay reduction programs) or allowances for damaged products, returns
or rejections of Product; (ii) trade, cash and quantity discounts, allowances and credits (including with respect to marketing programs such as coupon programs); (iii) chargeback payments, fees and rebates (or the equivalent thereof)
granted to group purchasing organizations, managed health care organizations, wholesalers, pharmacy benefit management (PBM) or other similar organizations or to federal, state/provincial, local and other governments, including their agencies, or to
trade customers; (iv) any invoiced freight, postage, shipping, insurance and other transportation charges; (v) reasonable provisions for allowance for uncollectible amounts; and (vi) sales, value-added, and excise taxes, tariffs and
duties, and other taxes directly related to the sale (but not including taxes assessed against the income derived from such sale). 
 For
clarity, Net Sales shall be determined in accordance with GAAP and a sale or transfer by Alpharma to its Affiliates and/or Sublicensees for resale by such Affiliate and/or Sublicensee shall not be considered a sale for the purpose of this provision
but the resale by such Affiliate and/or Sublicensee to a Third Party shall be a sale for such purposes. Transfer for Preclinical trials and Clinical Trials, testing or market research or promotional purposes shall not be a sale for the purpose of
calculating Net Sales. 
  

					
	CONFIDENTIAL	  	8	  	

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

 1.53 “Orphan Indication” means a disease or condition which qualifies as a
“rare disease or condition” under the Orphan Drug Act (21 U.S.C. 360aa et seq.) and regulations relating thereto (21 CFR Part 316), including amendments and successor laws and regulations thereto. 
 1.54 “PHN” means persistent pain associated with post-herpetic neuralgia. 
 1.55 “Party” means Durect or Alpharma, as the case may be, and, when used in the plural, shall mean Durect and Alpharma. 
 1.56 “Patent” and “Patents” mean issued patents and patent applications, including any and all provisionals,
continuations, divisionals, continuation-in-part applications, foreign counterparts, substitutions, reissues, renewals, re-examinations, supplementary protection certificates, patent term extensions, adjustments or restoration rights, registrations,
confirmations, successor protective rights or subsequently issued protective rights of similar nature of any of the above. 
 1.57
“Person” means an individual or a corporation, partnership, association, trust, or any other entity or organization, including a government or political subdivision or an agency or instrumentality thereof. 
 1.58 “Preclinical” when used with respect to studies or data refers to preliminary pharmacological studies undertaken in non-human
animals, but not necessarily for purposes of submission in support of Regulatory Approval. 
 1.59 “Pricing” or
“Pricing Approval” means any approval or authorization of a Governmental Entity, establishing a pricing scheme for Product in a Jurisdiction. 
 1.60 “Product” means the product under development by Durect currently known as ELADURTM, consisting of a transdermal patch containing Bupivacaine as the sole active pharmaceutical ingredient for
use in the Field which incorporates Product Know-How and/or is covered by Product Patent Rights, including all dosage strengths thereof, as described in Schedule 1.60 hereto. Product shall include any improvements, reformulations and line 

  

					
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extensions thereof, in each case consisting of a transdermal patch containing Bupivacaine as the sole active pharmaceutical ingredient for use in the Field
which incorporates Product Know-How and/or is covered by Product Patent Rights (hereinafter “Line Extension(s)”). 
 1.61
“Product Know-How” means Know-How related to the Product that is (a) Controlled by Durect or any of its Affiliates during the Term of this Agreement and (b) useful for a Party, or its Affiliates and/or licensees to
develop, make, have made, use, Commercialize and/or register the Product. 
 1.62 “Product Patents Rights” means
(i) those Patents in the Territory Controlled by Durect or any of its Affiliates during the Term which relate to the Product, excluding the [* * *] and (ii) those Patents in the Territory Controlled by Durect or any of its Affiliates
during the Term which cover Product Collaboration Inventions. Schedule 1.62 set forth a list of Product Patent Rights, as such list may be updated from time to time. 
 1.63 [* * *] 
 1.64 “Regulatory Approval” means, with respect to one or more Jurisdictions,
final approval of the Regulatory Approval Application (including, with respect to any Jurisdiction(s) other than the U.S., any Pricing Approvals and/or Reimbursement Approvals that Alpharma reasonably determines, consistent with the exercise of
Commercially Reasonable Efforts, are commercially necessary prior to commercial sale of the Product in such Jurisdiction(s)) for the Product filed in such Jurisdiction(s), including an approved NDA in the U.S., Marketing Authorization in the EU, or
equivalent local final approvals in Jurisdictions. 
 1.65 “Regulatory Approval Application” means a new drug application,
health registration, marketing authorization application, common technical document, regulatory submission, notice of compliance or equivalent application (excluding local and general business licenses and permits) required to be approved before
commercial sale or use of the Product as a pharmaceutical or medicinal product in a Jurisdiction (including, with respect to any Jurisdiction other than the U.S., any Pricing Approvals and/or Reimbursement Approvals that Alpharma reasonably
determines, consistent with the exercise of Commercially Reasonable Efforts, are commercially necessary prior to commercial sale of the Product in such Jurisdiction), together with all subsequent submissions, supplements and amendments thereto,
including an NDA in the U.S., MAA in the EU or local approvals in the Jurisdictions as applicable. 
  

					
	CONFIDENTIAL	  	10	  	

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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 1.66 “Regulatory Authority” means the FDA, EMEA and any health regulatory
authorities in the Territory or Jurisdiction that hold responsibility for the regulation of and/or the Reimbursement of medicinal products intended for human use. 
 1.67 “Regulatory Documentation” means all submissions to Regulatory Authorities and other Governmental Entities, including for Clinical Trials, tests, and biostudies, relating to the Product,
including all INDs and NDAs, as well as all correspondence with Governmental Entities (registration and licenses, Pricing and Reimbursement correspondence, regulatory drug lists, advertising and promotion documents), adverse event files, complaint
files, manufacturing records and inspection reports. 
 1.68 “Reimbursement” or “Reimbursement Approval” means the
official decision by the relevant Governmental Entity in any Jurisdiction responsible for establishing a reimbursement scheme to cover the costs related to the treatment of patients with the Product. 
 1.69 “Royalty Term” means, with respect to the Product in each Jurisdiction of the Territory on a Jurisdiction-by-Jurisdiction basis,
the period of time commencing on the First Commercial Sale of the Product in such Jurisdiction and ending on the later of: (a) fifteen (15) years from the date of the First Commercial Sale of the Product in such Jurisdiction and
(b) the end of the Patent Royalty Term in such Jurisdiction. 
 1.70 [* * *] 
 1.71 “Specifications” means the specifications for the Product, considering the applicable regulatory requirements in the Territory, as
may be amended from time to time. 
 1.72 “Sublicense” means the sublicense by Alpharma of Commercialization rights to the
Product to any Third Party in the Territory such that the Third Party has the right to record sales for its own account in lieu of Alpharma (such Third Party grantee shall be deemed a “Sublicensee”). 
 1.73 “Sublicense Fees” means any upfront payments, milestone payments and other license payments (including the fair market value of
debt or equity securities or other 

  

					
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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 
consideration) received by Alpharma or any Affiliate thereof as consideration for a Sublicense. For clarity, and notwithstanding the foregoing, Sublicense
Fees shall not include any royalties based on Product sales received by Alpharma or its Affiliates, any bona fide research and development funding paid to Alpharma and its Affiliates for research and development activities performed by Alpharma or
any of its Affiliates with respect to the Product, or the fair market value purchase price paid to Alpharma or any of its Affiliates by a Sublicensee for the purchase of any debt or equity securities of Alpharma or any of its Affiliates. 

1.74 “Subterritory” means each one of the following: 
  

			
	Subterritory A	 	- The United States of America (including territories and protectorates thereof)
	Subterritory B	 	- EU
	Subterritory C	 	- Japan
	Subterritory D	 	- All Jurisdictions of the Territory excluding Jurisdictions in Subterritories A, B and C

 1.75 “Terminated Countries” means those Jurisdictions in the Territory for which
Alpharma’s rights to develop and Commercialize the Product have been terminated in accordance with Sections 4.2(c) or 4.3(d). 
 1.76
“Territory” means all the countries in the world excluding Terminated Countries, if any. 
 1.77 “Third
Party” means any Person who or which is neither a Party nor an Affiliate of a Party. 
 1.78 [* * *] 
 1.79 “Valid Claim” means, with respect to Product in a particular Jurisdiction, any claim of a Patent that either: 
 (a) with respect to a granted and unexpired Patent in such Jurisdiction, that (i) has not been held permanently revoked, unenforceable or invalid by
a decision of a court or other Governmental Entity of competent jurisdiction, which decision is unappealable or unappealed within the time allowed for appeal, and (ii) has not been abandoned, disclaimed, denied or admitted to be invalid or
unenforceable through reissue or disclaimer or otherwise; or 
  

					
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 (b) with respect to a pending Patent application, that was filed and is being prosecuted in good
faith and has not been abandoned or finally disallowed without the possibility of appeal or re-filing of the application; provided, however, that such claim is not pending more than seven (7) years after the filing of the earliest patent
application from which such pending claim claims priority. 
 1.80 Other Definitions. 
 Each of the following terms is defined in the Section set forth opposite such term below: 
 “AAA” – Section 14.12(b) 
 “Adverse Event” – Section 4.9 
 “Agreement” – Preamble 
 “Alliance Manager” –Section 2.6. 
 “Alpharma”—Preamble 
 [* * *] 
 “Alpharma Post-Registration Study”—Section 5.2 
 “Alpharma Related Party”—Section 12.1 
 [* * *] 
 [* * *] 
 “Annual Net Sales
Period” – Section 6.2(a) 
 “Audited Party” – Section 7.5 
 “Auditing Party” – Section 7.5 
 “Confidential Information” – Section 10.4 
 “CRO” –
Section 13.7(c) 
 “Damages” – Section 12.1 
 [* * *] 
 “Designated
Executives” – Section 2.1(d) 
 “Development Plan” – Section 4.2 
 “Development Plan Budget” – Section 4.2 
 “Development Program” – Section 4.1 
 “Dispute” –
Section 14.12(b) 
 “Durect” – Preamble 
 [* * *] 
  

					
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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 “Durect Development Responsibilities” – Section 4.6 
 “Durect Related Party” – Section 12.2 
 “Effective Date” –Section 13.2(a) 
 “Execution Date” – Preamble

 “First Major Market Jurisdiction”—Section 4.3(b) 
 “First Refusal Notice”—Section 3.6 
 “Force Majeure”– Section 14.14 
 “Indemnified Party”
–Section 12.4 
 “Indemnifying Party” –Section 12.4 
 “Joint Development Committee” or “JDC”– Section 2.2(a) 
 “Joint Executive Committee” or “JEC” — Section 2.1(a) 
 “Joint Invention”—Section 9.1(d) 
 “Joint Patent Rights”—Section 9.2(b) 
 “Know-How Royalty Term” —
Section 6.2(b) 
 “Line Extensions”—Section 1.60 
 “Major Market Jurisdiction”—Section 4.3 
 “Negotiation Period”—Section 3.6 
 “One-Time Payment”—Section 6.1

 “Patent Litigation Losses”—Section 9.6(c) 
 “Patent Royalty Term” —Section 6.2(a) 
 “Patent Term Extensions” —Section 9.7 
 “Product Collaboration
Inventions”—Section 9.1(b) 
 “Product Material”—Section 13.7(b) 
 “Product Trademarks”—Section 3.5(a) 
 “Resolution Period” – Section 2.1(d) 
 “Royalties” –Section
6.2 
 “Rules” – Section 14.12(b) 
 “Second Major Market Jurisdiction”—Section 4.3(b) 
 “Serious Adverse Drug
Experience”—Section 13.3(b) 
 “Sublicensee” – Section 1.72 
 “Technology Transfer Plan”—Section 8.2 
 “Term”—Section 13.1. 
  

					
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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 “Third Party License Fees”—Section 9.6(e) 
 1.81 Interpretation 
 (a) Whenever any
provision of this Agreement uses the term “including” (or “includes”), such term shall be deemed to mean “including without limitation” and “including but not limited to” (or “includes without
limitations” and “includes but is not limited to”) regardless of whether the words “without limitation” or “but not limited to” actually follow the term “including” (or “includes”); 

(b) “Herein”, “hereby”, “hereunder”, “hereof” and other equivalent words shall refer to this Agreement in its
entirety and not solely to the particular portion of this Agreement in which any such word is used; 
 (c) All definitions set forth herein
shall be deemed applicable whether the words defined are used herein in the singular or the plural; 
 (d) Wherever used herein, any pronoun
or pronouns shall be deemed to include both the singular and plural and to cover all genders; 
 (e) The recitals set forth at the start of
this Agreement, along with the Exhibits and Schedules to this Agreement, and the terms and conditions incorporated in such recital, Exhibits and Schedules shall be deemed integral parts of this Agreement and all references in this Agreement to this
Agreement shall encompass such recitals, Exhibits and Schedules and the terms and conditions incorporated in such recitals, Exhibits and Schedules, provided, that in the event of any conflict between the terms and conditions of this Agreement
and any terms and conditions set forth in the Exhibits and Schedules, the terms of this Agreement shall control; 
 (f) In the event of any
conflict between the terms and conditions of this Agreement and any terms and conditions that may be set forth on any order, invoice, verbal agreement or otherwise, the terms and conditions of this Agreement shall govern; 
 (g) The Agreement shall be construed as if both Parties drafted it jointly, and shall not be construed against either Party as principal drafter;

  

					
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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 (h) Unless otherwise provided, all references to Sections, Schedules and Exhibits in this Agreement
are to Sections, Schedules and Exhibits of and to this Agreement; 
 (i) All references to days, months, quarters or years are references to
calendar days, calendar months, calendar quarters or calendar years unless otherwise expressly provided; references to a “business day” herein shall mean a day when both Alpharma and Durect corporate headquarters are open during regular
business hours for the conduct of normal business operations. 
 (j) Any reference to any federal, national, state, local or foreign statute
or law shall be deemed to also refer to all rules and regulations promulgated thereunder, unless the context requires otherwise; 
 (k) Any
requirements of notice or notification by one Party to another shall be construed to mean written notice in accordance with Section 14.5; and 
 (l) Wherever used, the word “shall” and the word “will” are each understood to be imperative or mandatory in nature and are interchangeable with one another. 
  

	2.	GOVERNANCE. 

 2.1 Joint Executive Committee.

 (a) Members; Officers. The Parties hereby establish a joint executive committee (the “Joint Executive Committee” or
“JEC”), which shall consist of up to [* * *] members with an equal number of members nominated by each of Durect and Alpharma. The initial members of the JEC are set forth on Schedule 2.1, as may be amended by the designating Party
from time to time. Representatives of the JEC shall be employees of the respective Party or its Affiliates. Each of Durect and Alpharma may replace any or all of its representatives on the JEC at any time upon written notice to the other Party. Any
member of the JEC may designate a substitute with due authority to temporarily attend and perform the functions of that member at any meeting of the JEC. Durect and Alpharma each may, in its discretion, invite non-member representatives that are
employees of such Party (or such Party’s Affiliates) and, with the other Party’s consent, consultants to attend meetings of the JEC. The JEC shall be chaired by a representative of Alpharma (or its Affiliates), as such representative may
be changed by Alpharma at any time. The chairperson shall appoint a secretary of the JEC, and such secretary shall serve for such term as designated by the chairperson. The initial chairperson is designated on Schedule 2.1. 
  

					
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 (b) Responsibilities. The JEC shall perform the following functions: 
 (i) manage and oversee the interactions and performance of the Parties pursuant to the terms of this Agreement (including the development
and Regulatory Approval process of the Product in the Territory); 
 (ii) review and approve any modifications or amendments
to the Development Plan and Development Plan Budget; 
 (iii) review and advise Alpharma regarding final label indications for
the Product in Subterritory A and Major Market Jurisdictions; 
 (iv) at each meeting, as applicable, review the Product
development status and expenditures with the activities, timelines and budget set forth in the Development Plan as well as discuss any deviations from the Development Plan; 
 (v) recommend further development activities after Regulatory Approval of the Product in each Jurisdiction, including Phase 4 studies;

 (vi) review and evaluate the progress of the JDC; 
 (vii) in accordance with the procedures established in Section 2.1(d), resolve disputes, disagreements and deadlocks unresolved by
the JDC; 
 (viii) review and advise Alpharma regarding Alpharma’s publication strategy for scientific publications
relating to the Product other than medical education and marketing publications; 
 (ix) consider and approve the development
of any Line Extensions to the Product in the Territory; 
 (x) establish trademark usage and quality standards in accordance
with Section 9.8; and 
  

					
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 (xi) have such other responsibilities as may be assigned to the JEC pursuant to this
Agreement or as may be mutually agreed upon by the Parties from time to time. 
 (c) Meetings. The JEC shall meet in person, by video
teleconference or by telephone initially at least [* * *] prior to the first Regulatory Approval of a Product in Subterritory A and thereafter at least [* * *], and more frequently as Durect and Alpharma deem appropriate or as required to resolve
disputes, disagreements or deadlocks in the JDC, on such dates, and at such places and times, as the Parties shall agree. From time to time, each Party may request a JEC meeting upon notice to the other Party specifying the subject matters to be
discussed, and the Parties shall convene such JEC meeting within [* * *] of the date of the notice. Meetings of the JEC that are held in person shall alternate between the offices of Durect and Alpharma (or the offices of their Affiliates designated
by such Parties), or such other place as the Parties may agree. The members of the JEC also may convene or be polled or consulted from time to time by means of telecommunications, video conferences, electronic mail or correspondence, as deemed
necessary or appropriate. 
 (d) Decision-making. The JEC may make decisions with respect to any subject matter that is subject to the
JEC’s decision-making authority and functions as set forth in Section 2.1(b). All decisions of the JEC shall be made by unanimous vote or written consent, with Durect and Alpharma each having, collectively, one vote in all decisions. The
JEC shall use good faith and reasonable efforts to resolve the matters within its roles and functions or otherwise referred to it. With respect to all matters that are subject to the JEC’s decision-making authority, if the JEC cannot reach
consensus within [* * *] after it has met and attempted to reach such consensus, including discussions between the Alliance Managers, the matter shall be referred on the [* * *] to the designated executive officers (“Designated
Executives”) of Alpharma and Durect who shall meet as soon as practicable, but no later than [* * *] after such referral, to attempt in good faith to resolve the dispute. If the dispute related to the matter is not resolved by the
Designated Executives by mutual agreement within [* * *] after a meeting to discuss the dispute (such [* * *] period after the meeting of the Designated Executives shall be referred to as the “Resolution Period”), [* * *].

  

					
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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 2.2 Joint Development Committee. 
 (a) Members; Officers. The Parties hereby establish a joint development committee (the “Joint Development Committee” or
“JDC”), which shall consist of up to [* * *] members with an equal number of members nominated by each of Durect and Alpharma, one of whom shall be designated by Alpharma as chairman. The initial representatives on the JDC are set
forth on Schedule 2.2, as may be amended by the designating Party from time to time. Each of Durect and Alpharma may replace any or all of its representatives on the JDC at any time upon notice to the other Party. Such representatives shall be
employees of each such Party or its Affiliates, and those representatives of each such Party shall, individually or collectively, have expertise in pharmaceutical drug development, regulatory matters, manufacturing, Clinical Trials, Non-Clinical
studies and/or other expertise to the extent relevant. Any member of the JDC may designate a substitute with due authority to temporarily attend and perform the functions of that member at any meeting of the JDC. Durect and Alpharma each may invite
non-member representatives that are employees of Alpharma or Durect (or their Affiliates) or external consultants of a Party to attend meetings of the JDC, provided that such external consultants have signed customary confidentiality agreements. The
secretary of the JDC shall initially be designated by Alpharma and thereafter alternate between a representative of Durect and a representative of Alpharma. 
 (b) Responsibilities. The JDC shall perform the following functions: 
 (i) review and
monitor the progress of the Development Program in accordance with the Development Plan; 
 (ii) monitor the progress of
regulatory filings and submissions for the Product in the Territory; 
 (iii) facilitate the exchange of information and
coordinate between the Parties as necessary or useful for development of the Product in the Territory; 
 (iv) review a
comparison of actual development costs of the Development Program to the Development Plan Budget for the year-to-date on a quarterly basis, such comparison to be as current as practicable as of the date of the meeting at which the review occurs,
which comparison will be used as a basis for evaluating proposed changes to the Development Plan and the Development Plan Budget; and 
  

					
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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 (v) have such other responsibilities as may be assigned to the JDC pursuant to this
Agreement or as may be mutually agreed upon by the Parties from time to time. 
 (c) Meetings. The JDC shall meet in person, by video
teleconference or by telephone initially at least [* * *], and more or less frequently as Durect and Alpharma deem appropriate or as reasonably requested by either such Party, on such dates, and at such places and times, as such Parties shall agree.
From time to time, each Party may request a JDC meeting upon written notice to the other Party specifying the subject matters to be discussed, and the Parties shall convene such JDC meeting within [* * *] of the date of the notice. Meetings of the
JDC that are held in person shall alternate between the offices of Durect and Alpharma, or such other place as such Parties may agree. The members of the JDC also may convene or be polled or consulted from time to time by means of
telecommunications, video conferences, electronic mail or correspondence, as deemed necessary or appropriate. 
 (d) Decision-making.
The JDC may make decisions with respect to any subject matter that is subject to the JDC’s decision-making authority and functions as set forth in Section 2.2(b). All decisions of the JDC shall be made by unanimous vote or written consent,
with Durect and Alpharma each having, collectively, one vote in all decisions. If, with respect to any matter that is subject to the JDC’s decision-making authority, after all reasonable efforts to reach consensus have been exhausted, including
discussions between the Alliance Managers, the JDC cannot reach consensus within [* * *] after it has first met and attempted to reach such consensus, the matter shall be referred on the [* * *] to the JEC for resolution. For all purposes under this
Agreement, any decision made pursuant to this Section 2.2(d) shall be deemed to be the decision of the JDC. [* * *]. 
 2.3 Minutes
of JEC and JDC Meetings. 
 (a) Definitive minutes of all JEC and JDC meetings shall be finalized no later than [* * *] after the meeting
to which the minutes pertain, as follows: 
 (i) Within [* * *] after a JEC or a JDC meeting, the secretary of such JEC or JDC
shall prepare and distribute to all members of such JEC or JDC draft minutes of the meeting. Such minutes shall provide a list of any actions, decisions or determinations approved by such JEC or JDC and a list of any issues yet to be resolved
(listing responsible persons and target completion dates), either within such JEC or JDC, or through the relevant escalation process. 
  

					
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 (ii) The secretary of such JEC or JDC shall have [* * *] after distribution of the
draft minutes to discuss each JEC or JDC member’s comments and finalize the minutes. The secretary and chairperson(s) of such JEC and JDC shall each sign and date the final minutes. The signature of such chairperson(s) and secretary upon the
final minutes shall indicate each Party’s assent to the minutes. 
 (b) If at any time during the preparation and finalization of JEC or
JDC meeting minutes, the JEC and JDC members do not agree on any issue with respect to the minutes, such issue shall be resolved as provided in Section 2.1(d) or 2.2(d), as the case may be. The decision resulting from the foregoing process
shall be recorded by the secretary in amended finalized minutes for said meeting. All other issues in the minutes that are not subject to the foregoing process shall be finalized within the [* * *] period as provided in Section 2.3(a).

 2.4 Duration of Committees. The JEC shall exist until the termination of this Agreement, unless [* * *], and the Parties shall
thereafter agree to alternative ways to cover the responsibilities and duties of the JEC. The JDC shall exist until [* * *], and the Parties shall thereafter discuss alternative ways to cover the responsibilities and duties of the JDC. 

2.5 Expenses. Each Party shall be responsible for all travel and related Costs for its members and other representatives to attend meetings of,
and otherwise participate on, a Committee. 
 2.6 Alliance Managers. Each of Durect and Alpharma shall appoint one employee
representative who possesses a general understanding of Clinical, regulatory, manufacturing and marketing issues to act as its respective alliance manager for this relationship (each, an “Alliance Manager”). The initial Alliance Managers
are set forth on Schedule 2.6, as amended by the designating Party from time to time. Each of Durect and Alpharma may replace its respective 

  

					
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Alliance Manager at any time upon written notice to the other. Any Alliance Manager may designate a substitute with due authority to temporarily perform the
functions of that Alliance Manager. Each Alliance Manager shall be charged with creating and maintaining a collaborative work environment within and among the Committees. Each Alliance Manager will also be responsible for: 
 (a) providing a single point of communication for seeking consensus both internally within the respective Party’s organizations and between the
Parties regarding business, contractual and strategic issues; 
 (b) identifying and raising cross-Party and/or cross-functions disputes to
the appropriate Committee in a timely manner; and 
 (c) planning and coordinating internal and external communications. 
 The Alliance Managers shall be entitled to attend meetings of any of the Committees, but shall not have, or be deemed to have, any rights or
responsibilities of a member of any Committee. Each Alliance Manager may bring any matter to the attention of any Committee where such Alliance Manager reasonably believes that such matter requires such attention. 
 2.7 Scope of Committees. Alpharma and Durect have chartered the Committees with a belief that vigorous interaction and cooperation between the
Parties are essential for the success of the Product. For the JEC and JDC, each Party shall use all reasonable efforts to reach consensus decisions at the JEC or JDC level respectively. Nothing in this Section 2, and no decision made by the JEC
or JDC under Sections 2.1(d) or 2.2 (d) shall be deemed to modify or supersede any express term or condition set forth in this Agreement, nor any decision or decision-making authority expressly provided to a Party in this Agreement. For
clarity, no Committee shall have the authority to make any determination that any Party is in breach of this Agreement. 
  

	3.	GRANT OF RIGHTS. 

 3.1 Rights Granted to Alpharma.
On the terms and subject to the conditions of this Agreement, Durect hereby grants to Alpharma: 
 (a) the exclusive right and license to
make, have made, use, offer for sale, sell and import the Product in the Territory, including the right to record sales for its own account; 
  

					
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 (b) in each case, solely for use in the Field and Territory and in connection with Alpharma’s
development and Commercialization of the Product and to otherwise exercise Alpharma’s rights and perform its obligations under this Agreement: 
 (i) an exclusive license under the Product Patents Rights and Product Know-How; 
 (ii) [* *
*]; 
 (iii) [* * *]; and 
 (iv) subject to the terms of the [* * *] Agreement, an exclusive sublicense under Durect’s license to the [* * *] Intellectual Property; and 
 (c) an exclusive license and right of cross-reference to all Development Data Controlled by Durect in existence as of the Effective Date solely to
exercise its rights and licenses under this Agreement with respect to the Product. 
 3.2 Sublicense Rights. Alpharma shall have the
right, [* * *], to delegate rights and obligations hereunder to an Affiliate and to appoint Affiliates to Commercialize the Product in the Territory. Furthermore, Alpharma shall have the right to appoint any Third Party designee(s) to develop,
manufacture and Commercialize the Product in the Territory alone or in combination with Alpharma or its Affiliates and/or to sublicense the rights granted to it under Section 3.1; provided that in the event of any sublicense or
delegation of rights by Alpharma hereunder, such sublicense or delegation shall be subject to the terms and conditions of this Agreement that, by their terms, are applicable to such sublicense or delegation, and the sublicense or delegation by
Alpharma hereunder shall not relieve Alpharma of its obligations under the Agreement. 
 3.3 Section 365(n) of the Bankruptcy
Code. All rights and licenses granted under or pursuant to this Agreement, including amendments hereto, by each Party to the other Party are, for all purposes of 11 U.S.C. Section 365(n), licenses of rights to intellectual property as
defined in Title 11. Each Party may elect to retain and may fully exercise all of its rights and elections under 11 U.S.C. Section 365(n). 
  

					
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 3.4 Exclusivity. 
 (a) During the Term of this Agreement, Durect and its Affiliates shall not develop or manufacture (except in performance of this Agreement) nor Commercialize, and shall not grant any rights or licenses to any Third
Party to develop or manufacture (except in performance of this Agreement) or Commercialize the Product in the Territory. 
 (b) During the
Term of this Agreement, neither Party nor its Affiliates shall directly or indirectly develop or Commercialize a Competitive Product in the Territory, nor sponsor, license or contract with a Third Party to do any of the foregoing acts.
Notwithstanding the foregoing, however, but subject to Sections 3.1 and 3.2, however, in the event of a Change of Control of a Party, the restrictions contained in this Section 3.4(b) shall [* * *]. In the event that a Party or one of its
Affiliates obtains “control” (as defined in Section 1.2) [* * *], such Party shall, [* * *] such control. 
 3.5
Trademarks; Logos. 
 (a) Product Trademarks. Alpharma shall have the right to select the Product name and all trademarks used
in connection with the marketing, promotion and Commercialization of the Product including special promotional or advertising taglines used in connection with the marketing of the Product, in each case in the Territory (all such trademarks specific
to the Product, with exception of the Durect Trademark, including all goodwill associated therewith, and all applications, registrations, extensions and renewals relating thereto, shall be referred to as “Product Trademarks”).
During the Term of the Agreement, Alpharma shall be the exclusive owner of the Product Trademarks and all goodwill associated therewith, and shall use Commercially Reasonable Efforts to register and maintain, at its Cost, such Product Trademarks as
shall be used for the Commercialization of the Product in the Territory. 
 (b) License to Durect Trademark. Subject to the provisions
of this Agreement and for the Term hereof, Durect hereby grants to Alpharma an exclusive license to use the Durect Trademark in the Territory solely in connection with the Commercialization of Product in the Territory. Alpharma agrees that all use
of the Durect Trademark by Alpharma shall inure to the benefit of and be on behalf of Durect. Alpharma agrees that it will not challenge the title or ownership of Durect in the Durect Trademark, or attack or contest the validity of such trademark.

  

					
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 (c) Durect Rights. To the extent permitted by Applicable Laws, at Durect’s election, the
labels and packaging of all Product to be marketed, distributed or sold in any Jurisdiction shall include text identifying Durect as the licensor of the Product and a Durect trademark (other than ELADURTM) selected by Durect to be placed in a
size and location determined in the reasonable, good faith discretion of Alpharma, provided that such mark: (i) is used in a consistent and noticeable manner sufficient to constitute trademark usage under Applicable Law, (ii) is clearly
identified as a trademark (i.e., through the use of a “®”, “TM” or other appropriate identifier) and (iii) is not used as combination marks with other marks or trademarks. Furthermore, Product labels and packaging
shall bear appropriate patent markings and notices as may be applicable. 
 3.6. Right of [* * *] Regarding [* * *]. Commencing at any
time upon [* * *] establishment of a development program for a [* * *], if any, if [* * *] desires to seek a Third Party to collaborate in the development and/or Commercialization of such [* * *] or if [* * *] elects to Commercialize such [* * *],
it shall provide written notice thereof (“First Refusal Notice”) to [* * *] and provide information reasonably requested by [* * *] regarding such [* * *]. Upon receipt of a First Refusal Notice, [* * *] shall have [* * *] to
(i) notify [* * *] in writing if it desires to participate with [* * *] in the further development and/or Commercialization of the [* * *] or (ii) decline to bid. If [* * *] does not respond in writing to the First Refusal Notice or
notifies [* * *] that it declines to bid within such [* * *] period, then it shall no longer have any rights with respect to the [* * *]. If [* * *] provides [* * *] with timely notice of its interest in participating in the development and
Commercialization of such [* * *], then the Parties shall attempt in good faith to negotiate the terms of an agreement for [* * *] to participate with [* * *] in the development or Commercialization of the [* * *] for a period of [* * *] (which may
be extended upon written agreement of the Parties) (“Negotiation Period”). If, despite such good faith negotiations, [* * *] are unable to enter into a definitive agreement during such Negotiation Period, then [* * *] will
thereafter be free to develop or Commercialize such [* * *] itself or enter into agreement(s) with Third Parties for the development and Commercialization of such [* * *]; provided that if thereafter [* * *] intends to license 

  

					
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Commercialization rights to such [* * *] to a Third Party more than [* * *] after the end of the last Negotiation Period with respect to such [* * *] or
intends to license Commercialization rights to such [* * *] to a Third Party on terms and conditions more favorable to the Third Party when all such terms and conditions are taken in the aggregate than those last offered to [* * *] shall first
re-offer such opportunity to [* * *] by delivering a new First Refusal Notice to [* * *] and provide to [* * *] any updated information reasonably requested by [* * *] regarding such [* * *], in which case the second, third, fourth and fifth
sentence of this Section 3.6 shall apply to such new First Refusal Notice. Notwithstanding anything herein to the contrary in this Section 3.6, however: (a) [* * *] shall have no further rights to any [* * *] if the Parties have not entered into a
definitive agreement after [* * *] has been offered such [* * *] in accordance with the terms hereof and after the elapse of [* * *] full Negotiation Periods, provided the last offer was made to [* * *] after such [* * *] had completed [* * *].

  

	4.	DEVELOPMENT AND REGULATORY. 

 4.1 Development
Generally. Commencing upon the Effective Date and subject to Section 4 and other terms of this Agreement, as between Durect and Alpharma, Alpharma shall be responsible, at its sole Cost, for development of and procuring Regulatory Approval
for the Product in the Territory (all such activities the “Development Program”). 
 4.2 U.S. Development. 
 (a) Development Plan. As of the Effective Date, the Parties have agreed upon a development plan (the “Development Plan”) covering
the activities necessary for developing the Product through Regulatory Approval in Subterritory A, including a budget (the “Development Plan Budget”), activities related to CMC development, Clinical and Non-Clinical development,
Regulatory Approval strategy, capital expenses that are specific to the Product, activities associated with manufacturing of Product for use in Clinical Trials, process development, scale-up for providing clinical supplies, and technology transfer
(including process development, scale up and validation activities) as needed to establish commercial scale manufacturing of the Product for Subterritory A, and other key elements reasonably necessary for the Parties to fulfill their development
responsibilities to each other under the terms of the Agreement. After the Effective Date, Alpharma shall thereafter update the 

  

					
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Development Plan in accordance with Alpharma’s normal planning cycle, but no less frequently than once a year, and provide a copy thereof to the JEC for
review and approval. In the event that the JEC does not unanimously approve any such update, then such matter shall be resolved in accordance with Section 2.1(d). 
 (b) Trials and Regulatory. Pursuant to the Development Plan and subject to this Section 4 and other terms of this Agreement, Alpharma shall use Commercially Reasonable Efforts to conduct such Preclinical
and Non-Clinical trials and Clinical Trials, at its own Cost, as necessary to seek and maintain Regulatory Approval of the Product in Subterritory A. Alpharma shall also use Commercially Reasonable Efforts to obtain Regulatory Approvals for the
Product in Subterritory A, including compiling, submitting and prosecuting all necessary data, documents and Regulatory Approval Applications (including labeling), in a format acceptable to the applicable Regulatory Authorities in Subterritory A. If
and when any Regulatory Approval is secured anywhere in Subterritory A, Alpharma shall thereafter use Commercially Reasonable Efforts to maintain such Regulatory Approval and pay all user fees and other costs required to maintain such Regulatory
Approval. 
 (c) Development Diligence. Alpharma shall use Commercially Reasonable Efforts to develop the Product through Regulatory
Approval in Subterritory A at its sole Cost. Without limiting the foregoing, Alpharma will use its Commercially Reasonable Efforts to perform the activities and to meet the timeline in the Development Plan. If, at any time, Alpharma materially
defaults on any of its development obligations with respect to Subterritory A set forth in Section 4 and fails to cure such default within [* * *] after receipt of written notice of termination from Durect, Durect shall have the right to
terminate Alpharma’s rights with respect to Subterritory A; provided, however, if the failure is not reasonably capable of being cured within the [* * *] cure period by Alpharma and Alpharma is making a good faith effort to cure
such failure, Durect may not terminate Alpharma’s rights in Subterritory A; provided further, however, that Durect may terminate Alpharma’s rights in Subterritory A if such failure is not cured within [* * *] of
Durect’s original notice of termination. In the event Durect terminates Alpharma’s rights with respect to Subterritory A hereunder: (i) Subterritory A shall thereafter be deemed a Terminated Country and no longer be included in the
Territory, and (ii) Durect shall have the rights set forth in Section 13.7 with 

  

					
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respect to Subterritory A. The foregoing termination rights of Durect shall be Durect’s sole and exclusive remedy and Alpharma’s sole and exclusive
liability for any failure by Alpharma to develop and Commercialize the Product in Subterritory A. 
 4.3 Development and Commercialization
Diligence Outside the U.S. 
 (a) Not later than [* * *] after the Effective Date, the Parties will jointly begin an assessment of the
market opportunity for the Product for Subterritories B, C and D and develop criteria for determining which such Jurisdictions present significant commercial potential for the Product and are subject to the obligations of this Section 4.3. Not
later than [* * *] after the Effective Date, the Parties will complete such assessment and the development of such criteria, and identify each Jurisdiction outside of the U.S. in which the development and Commercialization of Products by Alpharma
shall be subject to the obligations of this Section 4.3 (each such country, a “Major Market Jurisdiction”). Thereafter, the Parties shall review such designations annually and determine whether previously designated countries
should remain or cease to remain Major Market Jurisdictions and whether additional countries should be designated as Major Market Jurisdictions. If the Parties do not agree upon the designation of a country as a Major Market Jurisdiction or whether
a country should remain or cease to remain a Major Market Jurisdiction, the Parties shall submit the matter to the JEC for resolution in accordance with Section 2.1(d). Notwithstanding the foregoing provisions of this Section 4.3 relating
to the assessment, designation and review of Major Market Jurisdiction, the Jurisdictions listed on Schedule 4.3 are hereby categorized as Major Market Jurisdictions and shall not be subject to redesignation as non-Major Market Jurisdictions. Each
Party shall bear its own Costs incurred in assessing, designating and reviewing Major Market Jurisdictions in accordance with this Section 4.3(a). 
 (b) In at least one Major Market Jurisdiction (“First Major Market Jurisdiction”), Alpharma will either (i) initiate local Clinical Trials for a Product within [* * *] following U.S. Regulatory
Approval or (ii) if local Clinical Trials are not required for Regulatory Approval in the First Major Market Jurisdiction, file an application for Regulatory Approval within [* * *] following U.S. Regulatory Approval. In at least one additional
Major Market Jurisdiction (“Second Major Market Jurisdiction”), Alpharma will either (A) initiate local Clinical Trials for a Product within [* * *] following U.S. Regulatory Approval or (B) if 

  

					
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local Clinical Trials are not required for Regulatory Approval in the Second Major Market Jurisdiction, file an application for Regulatory Approval within [*
* *] following U.S. Regulatory Approval. If Subterritory C is not the First Major Market Jurisdiction or the Second Major Market Jurisdiction, then in addition to the foregoing requirements regarding the First Major Market Jurisdiction and the
Second Major Market Jurisdiction, Alpharma will either (A) initiate local Clinical Trials for a Product in Subterritory C within [* * *] following U.S. Regulatory Approval or (B) if local Clinical Trials are not required for Regulatory
Approval in Subterritory C, file an application for Regulatory Approval within [* * *] following U.S. Regulatory Approval. In all other Major Market Jurisdictions, Alpharma will use Commercially Reasonable Efforts to either (I) initiate local
Clinical Trials for a Product within [* * *] following U.S. Regulatory Approval or (II) if local Clinical Trials are not required for Regulatory Approval in any such other Major Market Jurisdiction, file an application for Regulatory Approval within
[* * *] following U.S. Regulatory Approval. For the avoidance of doubt, the filing of a Regulatory Approval Application with EMEA shall constitute filing of a Regulatory Approval Application in all Major Market Jurisdictions that are subject to
EMEA’s regulatory authority, and initiating Clinical Trials for the purpose of supporting the filing of a Regulatory Approval Application with EMEA shall constitute initiating local Clinical Trials with respect to all Major Market Jurisdictions
that are subject to EMEA’s regulatory authority. 
 (c) After satisfying the requirements of Section 4.3 with respect to a Major
Market Jurisdiction, Alpharma shall use Commercially Reasonable Efforts to obtain Regulatory Approval for and to Commercialize the Product in such Major Market Jurisdiction. [* * *]. 
 (d) If Alpharma fails to satisfy its obligations under this Section 4.3 with respect to a Major Market Jurisdiction, Durect shall thereafter have
the right to terminate Alpharma’s rights in such Major Market Jurisdiction if Alpharma has not cured such failure within the [* * *] period following written notice of termination by Durect; provided, however, if the failure is
not reasonably capable of being cured within the [* * *] cure period by Alpharma and Alpharma is making a good faith effort to cure such failure, Durect may not terminate Alpharma’s rights in such Major Market Jurisdiction; provided
further, however, that Durect 

  

					
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may terminate Alpharma’s rights in such Major Market Jurisdiction if such failure is not cured within [* * *] of Durect’s original notice of
termination. Notwithstanding the foregoing, Alpharma shall be deemed to have satisfied its obligations under this Section 4.3 and shall retain rights to all Jurisdictions in the EU provided that Alpharma has satisfied its development and
Commercialization obligations under this Section 4.3 in at least [* * *] of the Major Market Jurisdictions which are part of the EU. The Major Market Jurisdictions with respect to which Durect has terminated Alpharma’s rights hereunder
will thereafter be deemed Terminated Countries and no longer be included in the Territory, and Durect shall have the rights set forth in Section 13.7 in such Terminated Countries. The foregoing termination rights of Durect shall be
Durect’s sole and exclusive remedy and Alpharma’s sole and exclusive liability for any failure by Alpharma to develop and Commercialize the Product in any Major Market Jurisdiction. 
 (e) Except as otherwise set forth in Section 4.3(a), if any dispute arises between the Parties regarding the matters set forth in Section 4.3,
then such matter shall be submitted for resolution in accordance with Section 14.12. 
 4.4 Other Development Matters.

 (a) Prior to the first Regulatory Approval of the Product, Alpharma will provide to Durect draft forms of protocols for all studies
required for seeking a label indication in Subterritory A and the Major Market Jurisdictions. Alpharma shall consider in good faith all comments provided by Durect in writing within the [* * *] period following Durect’s receipt of such
protocols; provided that Alpharma shall have the sole discretion and authority to make all decisions with respect to final protocols and all other matters relating to development of the Product. Alpharma shall promptly provide Durect with a
copy of all final reports and final protocols from Preclinical and Non-Clinical trials and Clinical Trials in Subterritory A and the Major Market Jurisdictions. 
 (b) Promptly following, and in any event not later than [* * *] following, the Effective Date, Durect shall (i) transfer and assign to Alpharma ownership of all INDs held by Durect for the Product in the
Territory, if any, including copies of any Regulatory Documentation regarding the Product in the Territory and (ii) transfer and assign to Alpharma, 

  

					
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or to any Affiliate that Alpharma may specify, ownership of the Orphan Drug Designation received by Durect with respect to the Bupivacaine for PHN as
described in Schedule 4.4 hereto and all other regulatory exclusivity rights, if any, held by Durect and its Affiliates with respect to the Product. In addition, promptly following the Effective Date, Durect shall transfer to Alpharma copies of all
Development Data in existence as of the Effective Date. After such transfers and assignments by Durect, Alpharma shall be responsible for all Product-related reporting and other obligations to any Regulatory Authorities. 
 (c) During the period that the JDC remains in existence, all significant Product-related regulatory decisions within the Subterritory A and the Major
Market Jurisdictions shall be subject to review of the JDC. Durect shall have the right to review and comment upon material portions of regulatory filings and correspondence regarding major or material issues proposed to be made or sent with respect
to the Product in Subterritory A and the Major Market Jurisdictions prior to their submission to Regulatory Authorities, provided that (i) such review opportunity may be provided by electronic access to drafts of such documents,
(ii) the Alliance Managers will (with oversight from the JDC) coordinate the scope, timing and form of such document access in a manner that seeks to minimize administrative burden and (iii) for any comments from Durect to be considered,
the comments shall be provided promptly and reasonably in advance of any deadlines or target dates for submission. Alpharma shall promptly provide to Durect copies of or electronic access to material portions of all such filings and correspondence
from or to such Regulatory Authorities concerning the Product in Subterritory A and the Major Market Jurisdictions, provided that the Alliance Managers will (with oversight from the JDC) coordinate the scope, timing and form of all
such document access in a manner that seeks to minimize administrative burden. With regard to the NDA in Subterritory A, Durect shall, at Alpharma’s request, assist Alpharma in creating and finalizing Modules 2 and 3. In addition, Durect shall,
at Alpharma’s request, provide input for the creation and review of the Integrated Summary of Safety and the Integrated Summary of Efficacy. Upon request by Durect, other NDA sections or Modules will be available for review. At the request of
Alpharma, Durect shall participate, at Alpharma’s Cost, in any conference or meeting with Regulatory Authorities with respect to the Product in Subterritory A and the Major Market Jurisdictions. Alpharma shall notify Durect in writing of its
receipt of Regulatory Approval to market the Product in any Jurisdiction within [* * *] after receipt of any such approval. 
  

					
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 4.5 Line Extensions. In the event that Alpharma desires to develop Line Extensions to the
Product which Alpharma deems beneficial to the Commercialization of the Product in the Territory, Alpharma shall deliver to the JEC a written proposal summarizing the proposed Line Extension together with a plan summarizing the activities necessary
to develop the Line Extension through Regulatory Approval in the Territory similar to the approach outlined in the Development Plan. Upon receipt of such documentation, the JEC shall meet to discuss and consider such proposed Line Extension and
approve any plans and budgets for any Durect Development Responsibilities. The Line Extension shall be encompassed in the definition of “Product” under the Agreement, and subject to all the terms and conditions applicable thereto under
this Agreement. 
 4.6 Durect Development Responsibilities. 
 (a) Notwithstanding anything herein to the contrary, the following activities with respect to Product development are allocated to Durect (collectively
“Durect Development Responsibilities”): (i) unless otherwise agreed upon by the Parties, all development activities through completion of Phase 2 [* * *]; (ii) Dosage Form Development; (iii) manufacturing and
analytical method development, validation, stability and other CMC-related activities; (iv) management of any and all technology transfer, scale-up to commercial batch size and validation activities that may be required to enable any Person
chosen by Alpharma to manufacture commercial supplies of the Product; (v) generation of necessary documents related to the Durect Development Responsibilities in order for Alpharma to perform Clinical Trials and file for Regulatory Approval in
the Territory; and (vi) any other development activity allocated to Durect by Alpharma and agreed to by Durect. Durect shall use Commercially Reasonable Efforts to perform the Durect Development Responsibilities in accordance with the
Development Plan (including Development Plan Budget and timeline set forth therein) for such Durect Development Responsibilities. 
 (b)
Subject to Section 7.5, Alpharma shall pay to Durect its Durect Development Costs incurred with the performance of the Durect Development Responsibilities 

  

					
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on a monthly basis, net [* * *] from the receipt of an invoice therefor from Durect; provided that Alpharma shall have no obligation to reimburse
Durect’s Development Costs in excess of the then-current Development Plan Budget, and Durect shall have no obligation to perform activities which would result in Durect incurring costs in excess of the then-current Development Plan Budget, in
each case, until the JEC has approved any increase the Development Plan Budget. 
 (c) Durect may, with the prior written consent of Alpharma
(not to be unreasonably withheld, delayed or conditioned), retain Third Party contractors to perform some or all of the Durect Development Responsibilities so long as the Third Party is subject to the applicable terms of this Agreement, including
confidentiality obligations to Durect that are no less stringent than the confidentiality obligations set forth in Section 10, and agrees to assign ownership of all work product and intellectual property rights relating to the Product resulting
from such work to Durect. Durect’s selection of such Third Parties are subject to the prior written approval of Alpharma, such approval not to be unreasonably withheld, and all Durect Development Costs resulting from such Third Parties’
work shall be subject to audit by Alpharma. Durect will remain responsible to Alpharma for all Durect Development Responsibilities carried out by such Third Party contractors. 
 (d) In the event that Durect [* * *] included in the Durect Development Responsibilities, and provided that such [* * *]: (i) [* * *] or
(ii) [* * *] such Durect Development Responsibilities, then [* * *] such task included in the Durect Development Responsibilities [* * *]. 
 4.7 Development Data. Alpharma will exclusively own all Development Data which comes into existence after the Effective Date, and Durect hereby assigns to Alpharma all rights, title and interests therein Controlled by Durect or any
of its Affiliates. 
 4.8 Reporting Adverse Events. Commencing on the Effective Date, as between the Parties, Alpharma shall be
responsible for collection, investigation, reporting of information concerning adverse events with respect to the Product (as defined in the then current edition of ICH Guidelines and any other relevant regulations or regulatory guidelines) or any
other safety problem of significance (each such adverse event or problem, an “Adverse Event”) to the 

  

					
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appropriate Regulatory Authorities in the Territory in accordance with Applicable Laws. Alpharma will require that its Affiliates and Sublicensees comply
with all Adverse Event reporting obligations. In any event, Alpharma shall inform Durect of any Serious Adverse Drug Experience relating to the Product or Bupivacaine of which it becomes aware in a timely manner commensurate with the seriousness of
the Adverse Event. 
 4.9 Permitted Development Personnel. During the Term of the Agreement, each Party will not engage, retain or
employ any employees, subcontractors or consultants to perform any part of the Development Program that (A ) have been debarred or convicted of a crime for which an entity or person could be debarred under 21 U.S.C. Section 335a (or equivalent
law in any applicable Jurisdiction), or (B) is under indictment for a crime for which a person or an entity could be debarred under 21 U.S.C. Section 335a (or equivalent law in any applicable Jurisdiction). 
  

	5.	DISTRIBUTION AND PROMOTION. 

 5.1 Generally. As
between the Parties, Alpharma will be exclusively responsible for Commercializing the Product in the Territory and all Costs associated therewith. 
 5.2 Post-Registration Studies. Alpharma shall prolong the life cycle of the Product in Subterritory A and the Major Market Jurisdictions to the extent Alpharma determines it is Commercially Reasonable to do so. If Alpharma performs
any Phase 4 Clinical Trial or other Clinical Trial of the Product in Subterritory A and the Major Market Jurisdictions following receipt of Regulatory Approval for the Product (each, a “Alpharma Post-Registration Study”), Alpharma
shall provide Durect with draft forms of summary protocols for major studies before commencement of any such study. Alpharma shall consider in good faith all comments provided by Durect in writing within the [* * *] period following Durect’s
receipt of such protocols; provided, that Alpharma shall have the sole discretion and authority to make all decisions with respect to the final protocols and all other matters relating to Alpharma Post-Registration Studies. Alpharma shall
also promptly provide to Durect a copy of final protocols and reports from such Alpharma Post-Registration Studies. Alpharma shall bear the Costs of all Alpharma Post-Registration Studies. For the avoidance of doubt, Alpharma Post-Registration
Studies shall include any Clinical Trials required as a condition to, or for the maintenance of, Regulatory Approval of the Product in Subterritory A and the Major Market Jurisdictions. 
  

					
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 5.3 Alpharma Responsibilities; Rights. In connection with its responsibilities for
distribution, marketing and sales of the Product in the Territory, Alpharma shall, at its Cost, provide for all sales force personnel (including sales administration and training), order entry, customer service, reimbursement management, medical
affairs, medical information, marketing (including all advertising and promotional expenditures), warehousing, physical distribution, invoicing, credit and collections, forecasting and other related facilities and services necessary for such
Commercialization. 
 5.4 Annual Commercialization Reports. Following the end of each fiscal year after the First Commercial Sale of
the Product in Subterritory A or any Major Market Jurisdiction, Alpharma shall provide Durect with an annual summary of Alpharma’s efforts and plans for the Commercialization of the Product in Subterritory A and the Major Market Jurisdictions
as applicable. In addition, the Alpharma Alliance Manager shall provide reasonable summary information concerning Commercialization matters to the Durect Alliance Manager from time to time, as reasonably requested by Durect. To the extent
commercially feasible and permitted by Applicable Laws, all promotional materials shall include an acknowledgment of Durect as the developer and licensor of the Product. 
 5.5 Sales Forces. Alpharma shall employ or contract appropriately experienced sales forces to detail the Product in Subterritory A and the Major Market Jurisdictions in which Regulatory Approvals for the
Product are obtained, and [* * *]. In addition, Alpharma agrees that for the [* * *] after First Commercial Sale of the Product in Subterritory A and the Major Market Jurisdictions in which Regulatory Approvals for the Product are obtained, the
sales force will promote the Product [* * *]. 
  

	6.	PAYMENTS. 

 6.1 One-time Payments to Durect.
Alpharma shall, against invoice, pay to Durect the following one-time, non-refundable and non-creditable payments (each a “One-Time Payment”) within [* * *] after the occurrence of the specific event (in the case of the One-Time Payment
payable upon the occurrence of Milestone No. 1 set forth in the table below), within [* * *] after 

  

					
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the occurrence of the specific event (in the case of each of the One-Time Payments payable upon the occurrence of Milestone Nos. 2 - 12 set forth in the
table below) and concurrently with the payment of Royalties based on the applicable quarterly report (in the case of each of the One-Time Payments payable upon the occurrence of Milestone Nos. 13 - 15 set forth in the table below). The One-Time
Payments will be part of the consideration for the license granted in Section 3.1. 
  

					
	 Milestone
No.
	  	 Timing
	  	One-Time Payments to
Durect (U.S. Dollars)
	1	  	The Effective Date of this Agreement	  	Twenty Million Dollars
($20,000,000)
	[* * *]

 [* * *] 
 Each Party
shall promptly notify the other Party when any event triggering a One-Time Payment listed above has occurred, with payments [* * *] based on the latest quarterly report due [* * *] after the end of the applicable quarter. 
 6.2 Royalties. Subject to the other provisions of this Section 6, Alpharma shall pay Royalties to Durect in respect of the license granted to
Alpharma by Durect hereunder on a Jurisdiction-by-Jurisdiction basis for the applicable Royalty Term. In a Jurisdiction where the Patent Royalty Term is in effect, Alpharma shall owe Durect Patent Royalties with respect to calendar year Net Sales of
Product in such Jurisdiction. In a Jurisdiction where the Know-How Royalty Term is in effect, Alpharma shall owe Durect Know-How Royalties with respect to calendar year Net Sales of Product in such Jurisdiction. The aggregate of all Patent Royalties
and Know-How Royalties that are due to Durect in any Annual Net Sales Period (as defined below) shall be referred to herein as “Royalties.” 
 (a) Patent Royalties. Patent Royalties shall begin to accrue in accordance with the charts set forth below, on a Jurisdiction-by-Jurisdiction basis, on Net Sales within the Territory during the period
commencing on the date of the First Commercial Sale of the Product in such Jurisdiction and shall be payable until, the later of the expiration of (i) all Patents containing one or more Valid Claims that would be infringed by the development,
manufacture, sale, offer for sale, use, importation or exportation of the Product, or (ii) Marketing Exclusivity 

  

					
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Rights in such Jurisdiction (such period the “Patent Royalty Term”). Notwithstanding the foregoing however, if, during a given calendar
quarter during the Patent Royalty Term, there is a Generic Product commercially sold by a Third Party in a Jurisdiction, then so long as such Generic Product is being sold by such Third Party, the Royalties due with respect to Net Sales in such
Jurisdiction for such quarter during the Patent Royalty Term shall be reduced by [* * *] percent ([* * *]%) of the rates set forth in the charts below in this Section 6.2(a). 
 For Sales in Subterritory A 
  

			
	 Aggregate Annual Net Sales in Subterritory A
	  	 Royalty to Durect (percent of Net Sales)

	 Up to $[* * *] annual sales:
	  	[* * *] %
	 >$[* * *] annual sales:
	  	[* * *] %
	 >$[* * *] annual sales:
	  	[* * *] %
	 >$[* * *] annual sales:
	  	[* * *] %
	 >$[* * *] annual sales:
	  	[* * *] %

  

					
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 For Sales in Subterritory B, Subterritory C and Subterritory D in the aggregate 
  

			
	 Aggregate Annual Net Sales in Subterritory B, Subterritory C and
Subterritory D
	  	 Royalty to Durect (percent of Net Sales)

	Up to $[* * *] annual sales:	  	[* * *] %
	>$[* * *] annual sales:	  	[* * *] %
	>$[* * *] annual sales:	  	[* * *] %
	>$[* * *] annual sales:	  	[* * *] %

 The Royalty rates set forth above shall apply only to that portion of Net Sales within the applicable tier of Net
Sales. 
 The periods by which annual Net Sales are measured for purposes of this Section 6.2
shall be a calendar year (each, an “Annual Net Sales Period”) except that the first Annual Net Sales Period shall begin on the first day of the calendar quarter preceding the First Commercial Sale and continue to the end of the
calendar quarter ending on December 31st of that calendar year. For purposes of illustration, see Example 1 in Schedule 6.2. 
 (b) Know-How Royalties. Know-How Royalties shall accrue, on a Jurisdiction-by-Jurisdiction
basis, on Net Sales in the Jurisdiction during any portion of the applicable Royalty Term that remains after the expiration of the applicable Patent Royalty Term (the “Know-How Royalty Term”). Subject to the other provisions of this
Section 6, if the Know-How Royalty Term is in effect in a Jurisdiction, Alpharma shall pay Durect Know-How Royalties with respect to the aggregate annual Net Sales in such Jurisdiction at a rate of [* * *]% of the rates set forth in the tables
set forth in Section 6.2(a). The first Annual Net Sales Period in which Know-How Royalties are payable shall begin on the first day of the Know-How Royalty Term and continue to the end of the calendar quarter ending on
December 31st of that calendar year. For purposes of illustration, see Example 2 in Schedule 6.2. 
 6.3 Sublicense Income. In addition to the Royalties payable to Durect under Section 6.2 and the One-Time Payments payable to Durect under
Section 6.1, if Alpharma grants a Sublicense under Section 3.2 with respect to a Jurisdiction, Alpharma shall thereafter pay Durect, within [* * *] after the receipt thereof by Alpharma, [* * *] percent ([* * *]%) of the portion of any
Sublicense Fees received by Alpharma that exceeds the aggregate of all One-Time Payments payable by Alpharma to Durect with respect to such Jurisdiction. 
  

					
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 6.4 Existing Third Party Royalties. Durect shall be solely responsible for payment of [* * *]
percent ([* * *]%) of all financial obligations to [* * *] under the [* * *] Agreement. 
  

	7.	PAYMENTS AND REPORTS. 

 7.1 Payments of Royalties.
Beginning [* * *] after the end of the calendar quarter in which the First Commercial Sale is made and for each calendar quarter thereafter (no later than [* * *] after the end of such calendar quarter), Alpharma shall submit a statement to Durect,
which shall set forth the amount of Net Sales in the Territory by Jurisdiction, during such quarter, and the calculation of Royalties due on such Net Sales in each Jurisdiction and in the aggregate for the Territory for such quarter. Each such
statement shall be accompanied by the payment, if any, due to Durect. 
 7.2 Mode of Payment for One-Time Payments and Royalties.
Alpharma shall make all payments required under this Agreement by wire transfer to any account specified by Durect or as otherwise directed by Durect from time to time in Dollars. 
 7.3 Currency Conversion. Royalties with respect to any Net Sales in Jurisdictions where the Dollar is not used as currency shall be calculated by
converting the amount of Net Sales into the corresponding amount in Dollars and applying the applicable Royalties percentage under Section 6 to such amount. The currency conversion shall be made using the average of the rates of exchange for
the conversion of the currency in which sales were made to Dollars over the calendar quarter during which such sales were made, as such rates are published by the Wall Street Journal, Western Edition. 
 7.4 Records Retention. Alpharma, its Sublicensees, Durect and each such Party’s respective Affiliates shall keep complete and accurate
records pertaining to Durect Development Costs and the sale of Product and the calculation of Net Sales in the Territory, as applicable, to permit the determination of Durect Development Costs and Royalties for a minimum period of [* * *] after the
calendar year in which such sales or costs were occurred, and in sufficient detail to permit the Parties to confirm the accuracy of each of the foregoing. 
  

					
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 7.5 Audit Request. During the Term of this Agreement and for a period of [* * *] thereafter,
at the request and Cost of a Party (the “Auditing Party”), Durect and its Affiliates (in the case of a request by Alpharma) or Alpharma and its Affiliates and Sublicensees (in the case of a request by Durect) (the “Audited
Party”) shall permit an independent, certified public accountant appointed by the Auditing Party and reasonably acceptable to the Audited Party, at reasonable times and upon reasonable advance notice of not less than [* * *], but not more
often than [* * *] in each calendar year, to examine such records during the [* * *] prior to the notice as may be necessary to determine the correctness of any report or payment made under this Agreement or obtain information as to the
determination of the Durect Development Costs, Net Sales and Royalties payable for any calendar quarter in such audited period. Results of any such examination shall be made available to all Parties except that said independent, certified public
accountant shall verify to the Auditing Party such amounts and shall disclose no other information revealed in such audit. The examination shall also include disclosure of the methodology and calculations used to determine the results. The said
independent, certified public accountant shall execute a written confidentiality agreement with the Audited Party. 
 7.6 Cost of
Audit. The Auditing Party shall bear the full Cost of the performance of any audit requested by the Auditing Party except as hereinafter set forth. If, as a result of any inspection of the books and records of the Audited Party, it is shown that
payments made by one Party to the other under this Agreement were less than the amount which should have been paid (in the case of Royalties) or the amount of costs charged by one Party to the other Party were more than the amount that should have
been charged (in the case of Durect Development Costs), then the under-paying or over-charging Party, as applicable, shall make all payments required to be made to eliminate any discrepancy revealed by said inspection within [* * *], including in
each case interest at the rate of [* * *] percent ([* * *]%) per month (or the maximum interest allowable by Applicable Law, whichever is less) for the amount of the discrepancy. Furthermore, if the payments made were less than [* * *] percent ([* *
*]%) of the amount that should have been paid during any calendar year, or if there was an overcharge of more than [* * *] percent ([* * *]%) of the amount of that was owed, in either case due to the error of the Audited Party, the Audited Party
shall also reimburse the Auditing Party for reasonable Costs incurred by the Auditing Party in respect of such audit. 
  

					
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 7.7 No Non-Monetary Consideration for Sale. Alpharma and its Sublicensees and Affiliates shall
not accept or solicit any non-monetary consideration for the sale of the Product without the prior written consent of Durect, provided, however, the use by Alpharma and its Affiliates of a customary and reasonable amount of the Product for
promotional sampling, compassionate use or donations shall not violate this Section 7.7. 
  

	8.	COMMERCIAL SUPPLY OF PRODUCT 

 8.1 Responsibility.
Alpharma shall use Commercially Reasonable Efforts, at its sole Cost, to manufacture the Product for Clinical use and Commercialization in the Territory in compliance with the terms and conditions of this Agreement. At Alpharma’s election,
Durect shall assign the [* * *] Agreement to Alpharma within [* * *] of the Effective Date. 
 8.2 Technology Transfer. In the event
that Alpharma elects to have Product manufactured by itself or a CMO other than [* * *], Durect shall use Commercially Reasonable Efforts to provide in a timely manner such of Manufacturing Technology Controlled by Durect in order for Alpharma or
the CMO selected by Alpharma to manufacture the Product, and shall use Commercially Reasonable Efforts to provide technical assistance to enable the use of such Manufacturing Technology to manufacture the Product, such assistance to be detailed in a
technology transfer plan to be agreed upon by the Parties (the “Technology Transfer Plan”). Alpharma shall reimburse Durect its Durect Development Costs incurred in providing the Manufacturing Technology and technical assistance in
accordance with a budget therefor to be agreed by the Parties in advance. Durect shall be reimbursed by Alpharma on a monthly basis, within [* * *] of receipt of an invoice setting forth such Durect Development Costs. 
 8.3 Commercial Supply in Territory. Alpharma shall have sole responsibility (including complete decision making authority and discretion) to
manufacture or have manufactured Product for the Commercialization of the Product in the Territory, and shall use Commercially Reasonable Efforts to maintain or arrange for sufficient manufacturing capacity to meet the reasonably anticipated market
demand for the Product in the Territory. 
  

					
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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

	9.	INTELLECTUAL PROPERTY. 

 9.1 Ownership of Collaboration
Inventions. Subject to the terms hereof, including the licenses and other rights granted hereunder, all Collaboration Inventions shall be owned as follows: 
 (a) [* * *] Collaboration Inventions (including all Patents and other Intellectual Property Rights relating thereto) that relate to the Product (including, inter alia, components thereof, its composition or
formulation, methods of manufacture, processing, finishing, packaging and methods of use), without regard to inventorship (each such Collaboration Invention a “Product Collaboration Invention”). 
 (b) With respect to Collaboration Inventions that do not constitute Product Collaboration Inventions, [* * *] such Collaboration Inventions (including
all Patents and other Intellectual Property Rights relating thereto) [* * *] its employees and/or Third Parties acting on behalf of Durect in the performance of the Development Plan and other activities undertaken by it under this Agreement (each
such Collaboration Invention a “[* * *]”). 
 (c) With respect to Collaboration Inventions that do not constitute Product
Collaboration Inventions, [* * *] such Collaboration Inventions (including all Patents and other Intellectual Property Rights relating thereto) [* * *] its employees and/or Third Parties acting on behalf of Alpharma in the performance of the
Development Plan and other activities undertaken by it under this Agreement (each such Collaboration Invention, an “[* * *]”). 
 (d) With respect to Collaboration Inventions that do not constitute Product Collaboration Inventions, the Parties shall jointly own all Joint Inventions (as defined below) and, subject to the rights granted each Party under this Agreement
and except as otherwise specifically provided under this Agreement, each Party may make, use, sell, keep, license or assign its interest in Joint Inventions and otherwise undertake all activities a sole owner might undertake with respect to such
Joint Inventions, without the consent of and without accounting to the other Party. “Joint Invention” means a Collaboration Invention which is not a Product Collaboration Invention for which: (i) one or more employees,
consultants or agents of Durect or any other persons obligated to assign such Collaboration Invention to Durect; and (ii) one or more employees, consultants or agents of Alpharma or any other persons obligated to assign 

  

					
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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 
such Collaboration Invention to Alpharma, are joint inventors of such Collaboration Invention. The term “joint inventors,” as it applies generally
to Collaboration Inventions, shall be construed in accordance with how that term is used pursuant to United States patent law. 
 (e) Subject
to appropriate confidentiality undertakings, each Party shall notify the other Party promptly after the completion of invention disclosure statements (or similar type of internal process employed by such Party for recording or recognizing
inventions) for each Collaboration Invention (or, if any provisional or other patent application is filed claiming such invention, promptly upon such filing), and shall provide a copy of written documentation of the Collaboration Invention suitable
to describe the invention and identify any inventors participating in the invention (or, if any patent application is filed, a full and complete copy of the documents submitted to the relevant patent office) to the other Party. 
 (f) Each Party may use and practice its own Collaboration Inventions in any manner not inconsistent with the terms of this Agreement without the consent
of the other Party and without an obligation to notify the other Party of such intended use or to pay royalties or other compensation to the other by reason of such use. For the avoidance of doubt, neither Party is granted any license rights to any
Intellectual Property Rights of the other Party which may be required for such Party to use a Collaboration Invention, unless otherwise expressly granted herein or as may be necessary to fulfill the intent of this Agreement. 
 (g) Each Party shall, at the request of the other Party, execute all assignment documents necessary to perfect the ownership interests in Collaboration
Inventions as determined pursuant to this Section 9.1. Each Party hereby agrees that Development Data owned by such Party may be included in patent and patent applications covering Collaboration Inventions owned by the other Party as reasonably
useful to the filing and prosecution of such patent applications and patents, and the Party owning such Development Data shall reasonably cooperate with the other Party to allow for such inclusion. 
 (h) Each Party has and will continue to have written contracts with all Third Parties (including employees and subcontractors) performing services on its
behalf under this Agreement and, where such services may give rise to the creation of inventions that may be Collaboration Inventions, such Party shall ensure that such contracts provide for the 

  

					
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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 
assignment to such Party all Collaboration Inventions and rights therein; provided, however, notwithstanding the foregoing, Alpharma may enter
into Third Party contract manufacturing agreements for the sole purpose of having the Product manufactured for Alpharma that do not require such Third Party manufacturers to assign any Collaboration Inventions that are manufacturing process
inventions to Alpharma if such Third Party manufacturers do not agree to the assignment of such manufacturing process Collaboration Inventions. 
 9.2 Prosecution of Patents. 
 (a) Durect Controlled Patents. 
 (i) As between Durect and Alpharma, Durect shall prepare, prosecute and maintain the [* * *] Product Patent Rights and [* * *] (including
their issuance, reissuance, reexamination and the defense of any interference, revocation or opposition proceedings) at Durect’s sole Cost and discretion subject to the provisions of this Section 9.2(a). 
 (ii) With respect to Product Patent Rights, Durect shall furnish Alpharma with copies of all substantive prosecution correspondence to and
from patent offices in the Territory and provide Alpharma a reasonable time to offer its comments thereon before Durect makes a submission to the relevant patent office, provided that in the event that delay would jeopardize any potential
Product Patent Right, Durect shall have the right to proceed without awaiting Alpharma’s comments on any patent application or correspondence relating thereto. Alpharma shall offer its comments promptly, and Durect shall consider in good faith
such comments of Alpharma and shall incorporate such comments if reasonable. Durect shall not abandon any patent application or patent in the Product Patent Rights without the prior written consent of Alpharma, such consent not to be unreasonably
withheld or delayed. If, subject to Alpharma’s foregoing consent right, Durect determines to abandon, or not to file, prosecute, defend or maintain, any Product Patent Right (including not to defend any interference,
revocation or opposition proceedings) in any Jurisdiction, then Durect shall provide Alpharma with [* * *] prior written notice (or such shorter time period that would permit Alpharma a reasonable opportunity to respond without any loss of
rights) 

  

					
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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 
of such determination, and Alpharma shall have the right and opportunity to file, prosecute, defend and/or maintain such Product Patent Right in
Durect’s name and at Alpharma’s sole Cost and expense, provided, however, that the payment of Costs therefor by Alpharma shall not affect Durect’s ownership in such Patent. 
 (b) Joint Patents. With respect to the decision to initiate the drafting and filing of a new patent application claiming a Joint Invention, the
Parties shall first exchange sufficient information identifying such Joint Invention and discuss in good faith the relative merits of seeking patent rights thereto and, upon the prior mutual agreement of the Parties to proceed, not unreasonably
withheld, Alpharma shall take such actions as are necessary or appropriate to procure, prosecute and maintain patents and/or patent applications to such Joint Inventions (“Joint Patent Rights”) (including any issuance, reissuance or
reexamination thereof and the defense of any interference, revocation or opposition proceedings related thereto) at Alpharma’s sole Cost and discretion, subject to the provisions of this Section 9.2(b); provided, that all such Joint
Patents shall be owned jointly. Alpharma shall furnish Durect with copies of drafts of such Joint Patents and any substantive prosecution correspondence relating to such Joint Inventions to and from patent offices throughout the Territory and permit
Durect to offer its comments thereon before Alpharma makes any submission or response to a patent office. Alpharma will inform Durect of the countries in which it intends to file Joint Patents. Durect shall offer its comments promptly, including any
request that the Joint Patents be filed in additional countries; provided, that Alpharma shall determine the appropriate action after considering in good faith any comments or requests from Durect, and further provided that in the
event that delay would jeopardize any potential patent right, Alpharma shall have the right to proceed without awaiting Durect’s comments. If Alpharma determines in its sole discretion not to file, prosecute, defend or maintain any Joint Patent
Rights (including failing to defend any interference, revocation or opposition proceedings) in any country, then Alpharma shall provide Durect with [* * *] prior written notice (or such shorter time period that would permit Durect a reasonable
opportunity to respond in a timely manner) of such determination, and Durect shall have the right and opportunity to file, prosecute, defend and/or maintain such Joint Patent Rights on behalf of the Parties at Durect’s sole Cost. 
  

					
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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 (c) Alpharma Patents. As between Durect and Alpharma, Alpharma may prepare, prosecute and
maintain all Patents claiming an Alpharma Collaboration Invention (including their issuance, reissuance, reexamination and the defense of any interference, revocation or opposition proceedings) at Alpharma’s sole Cost and discretion.

 (d) Each Party shall, at the reasonable request of the other Party, execute all lawful papers, all divisional, continuing, reissue and
foreign applications, make all rightful oaths and take such other actions as may be reasonably requested by the other Party in conjunction with submission, filing, prosecution and defense of Patents and to aid in obtaining the proper protection of
inventions pursuant to this Section 9.2. 
 9.3 Patent Certifications. 
 (a) To the extent required or permitted by Applicable Laws, [* * *] shall use its Commercially Reasonable Efforts to maintain with the applicable
Regulatory Authorities in the Territory during the Term of this Agreement correct and complete listings of applicable Patents covering the Product, including in the U.S., all so called “Orange Book” listings required under the Hatch-Waxman
Act. In the event either Party receives notice that a Third Party has filed a patent certification under the Hatch-Waxman Act or any successor statute (e.g., a Paragraph IV Certification under 21 C.F.R. §314.50(i) or 314.94(a)(12)) referencing
a Patent licensed under Section 3.1, then such Party shall immediately notify the other Party in writing of such notice. 
 (b) Alpharma
shall have the first right, but not the duty, upon written notice to Durect to institute an action against such Third Party alleging infringement of any Product Patent Rights, and to the extent necessary, Durect shall assign to Alpharma its cause of
action for infringement of any Product Patent Rights against such Third Party. Alpharma shall consider in good faith all comments provided by Durect within the [* * *] period following Durect’s receipt of such notice from Alpharma regarding
Alpharma’s intention to initiate an action against such Third Party alleging infringement of any Product Patent Rights; provided that, subject to terms of Section 9.3(d), Alpharma shall have the sole discretion and authority to
exercise its first right to institute such a patent infringement action. If Alpharma determines not to institute an action against such Third Party alleging infringement of any Product Patent Rights, Alpharma shall so notify Durect at least [* * *]
before the expiration of the period 

  

					
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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 
within which a patent holder may bring an action for infringement against such Third Party. Durect shall then have the right, but not the duty, to institute
such an action against such Third Party alleging infringement of any Product Patent Rights. 
 (c) As between Durect and Alpharma, Durect
shall have the first right, but not the duty, upon written notice to Alpharma to institute an action against a Third Party for infringement of the [* * *] in response to such Third Party’s filing of a Paragraph IV certification referencing such
Patent rights. Durect shall consider in good faith all comments provided by Alpharma within the [* * *] period following Alpharma’s receipt of such notice from Durect regarding Durect’s intention to initiate an action against such Third
Party alleging infringement of the [* * *]; provided that, subject to terms of Section 9.3(d), Durect shall have the sole discretion and authority to exercise its first right to institute such a patent infringement action. If Durect
determines not to institute an action against such Third Party alleging infringement of the [* * *], Durect shall so notify Alpharma at least [* * *] before the expiration of the period within which a patent holder may bring an action for
infringement against such Third Party. Alpharma shall then have the right, but not the duty, to institute such an action against such Third Party alleging infringement of the [* * *]; provided, however, that Alpharma’s right to undertake any
such action alleging infringement of the [* * *] shall be subject to the prior written consent of Durect, not to be unreasonably withheld, and also the applicable terms of any agreements relating to the [* * *] entered into by Durect prior to the
Effective Date, and with respect any actions alleging infringement of the [* * *], subject to the applicable terms of the [* * *] Agreement. 
 (d) The Costs of any such action under this Section 9.3 (including fees of attorneys and other professionals) shall be borne by the Party instituting the action, or, if the Parties elect to cooperate in instituting and maintaining such
action, such Costs shall be borne by the Parties in such proportions as they may agree in writing. For any such action to terminate any such infringement, in the event that either Party is unable to initiate or prosecute such action solely in its
own name or it is otherwise advisable to obtain an effective remedy, the other Party will join such action voluntarily and will execute and cause its Affiliates to execute all documents necessary for the enforcing Party to initiate and maintain such
action. Each Party shall at its own expense promptly give to the Party bringing such infringement 

  

					
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proceedings such reasonable assistance as the Party bringing the action may reasonably request. The Party instituting any such action may not enter into any
settlement, consent judgment or other voluntary final disposition of such action that admits the invalidity or unenforceability of any Patent licensed hereunder, subjects the other Party to an injunction or requires the other Party to make any
monetary payment without the prior written consent of the other Party, not to be unreasonably withheld by the other Party. The Party undertaking any proceedings shall keep the other reasonably informed of the progress of the action and shall
consider the comments and observations of the other in prosecuting the proceedings. Any award paid by a Third Party as a result of such an infringement action (whether by way of settlement or otherwise) shall be allocated in the same manner as
provided in Section 9.4.  
 9.4 Enforcement of Patent Rights. 
 (a) In the event that either Alpharma or Durect becomes aware of any Competitive Product that is or is intended to be made, used, or sold in the Territory
by a Third Party that it believes to infringe Product Patent Rights, [* * *], such Party will promptly notify the other Party of all the relevant facts and circumstances known by it in connection with the infringement. Alpharma and Durect shall
thereafter consult and cooperate fully to determine a course of action, including the commencement of legal action as provided in this Section 9.4 by either or both Parties, to terminate any such infringement. 
 (b) As between Durect and Alpharma, Alpharma shall have the first right, but not the duty, upon written notice to Durect to initiate, prosecute and
control the enforcement of any of the Product Patent Rights against infringement by a Third Party in the Territory through the marketing or sale of a Competitive Product. If Alpharma does not institute a proceeding against such Third Party alleging
infringement of a Product Patent Right within 180 days of a Party’s first notice to the other Party of such Third Party infringement, then Durect shall have the right, but not the duty, to institute such an action against such Third Party for
infringement of such Product Patent Right. 
 (c) As between Durect and Alpharma, Durect shall have the first right, but not the duty, upon
written notice to Alpharma to initiate, prosecute and control the enforcement of any of the [* * *] against infringement by a Third Party in the Territory through the marketing 

  

					
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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 
or sale of a Competitive Product. If Durect does not institute a proceeding against such Third Party alleging infringement of the [* * *] within [* * *] of a
Party’s first notice to the other Party of such Third Party infringement, then Alpharma shall have the right, but not the duty, to institute such an action against such Third Party for infringement of any of the [* * *]; provided, however, that
Alpharma’s right to undertake any such action alleging infringement of the [* * *] shall be subject to the prior written consent of Durect, not to be unreasonably withheld and also the applicable terms of any agreements relating to the [* * *]
entered into by Durect prior to the Effective Date, and with respect any actions alleging infringement of the [* * *], subject to the applicable terms of the [* * *] Agreement. 
 (d) The Costs of any such action under this Section 9.4 (including fees of attorneys and other professionals) shall be borne by the Party
instituting the action, or, if the Parties elect to cooperate in instituting and maintaining such action, such Costs shall be borne by the Parties in such proportions as they may agree in writing. For any such action to terminate any such
infringement, in the event that either Party is unable to initiate or prosecute such action solely in its own name or it is otherwise advisable to obtain an effective remedy, the other Party will join such action voluntarily and will execute and
cause its Affiliates to execute all documents necessary for the enforcing Party to initiate and maintain such action. Each Party shall at its own expense promptly give to the Party bringing such infringement proceedings such reasonable assistance as
the Party bringing the action may reasonably request. The Party instituting any such action may not enter into any settlement, consent judgment or other voluntary final disposition of such action that admits the invalidity or unenforceability of any
Patent licensed hereunder, subjects the other Party to an injunction or requires the other Party to make any monetary payment without the prior written consent of the other Party, not to be unreasonably withheld by the other Party. The Party
undertaking any proceedings shall keep the other reasonably informed of the progress of the action and shall consider the comments and observations of the other in prosecuting the proceedings. 
 (e) Any recovery obtained as a result of an infringement action brought under this Section 9.4, whether by judgment, award, decree or settlement,
will first be applied to reimbursement of each Party’s Costs in bringing such suit or proceeding, and any remaining balance will be distributed as follows: 
 (i) if Alpharma has instituted and maintained such action alone, Alpharma shall be entitled to retain [* * *] less [* * *], which [* * *]
shall be paid to Durect. The “[* * *]” shall mean [* * *] in the Annual Net Sales Period in which such remaining funds are received on such remaining funds [* * *]; 
  

					
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 (ii) if Durect has instituted and maintained such action alone, Durect shall be
entitled to retain [* * *] less the [* * *], which [* * *] shall be paid to Alpharma; or 
 (iii) if the Parties have
cooperated in instituting and maintaining such action, the Parties shall allocate such remaining funds among themselves in the same proportion as they have agreed to bear the Costs of instituting and maintaining such action. 
 9.5 Defense of Patents. 
 (a) In the
event that either Alpharma or Durect becomes aware of any action initiated by a Third Party (or any counterclaim or defense asserted in any other action) in the Territory alleging invalidity or unenforceability of any Product Patent Rights, [* * *],
such Party will promptly notify the other Party of all the relevant facts and circumstances known by it in connection with such action. Alpharma and Durect shall thereafter consult and cooperate fully to determine a course of action. 
 (b) Alpharma shall have the first right but not the duty to defend and control any action initiated by a Third Party (or any counterclaim or defense
asserted in any other action) in the Territory alleging invalidity or unenforceability of any Product Patent Rights. If Alpharma fails to defend any such action initiated by a Third Party (or any counterclaim or defense asserted in any other action)
within [* * *] of notice from such Third Party (or such shorter time period that would permit Durect a reasonable opportunity to respond in a timely manner), Durect shall thereafter have the right to defend and control any such invalidity action,
counterclaim or defense in the Territory. 
 (c) Durect shall have the first right but not the duty to defend and control any action
initiated by a Third Party (or any counterclaim or defense asserted in any other action) in the Territory alleging invalidity or unenforceability of the [* * *]. If Durect fails to defend 

  

					
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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 
any such action initiated by a Third Party (or any counterclaim or defense asserted in any other action) within [* * *] of notice from such Third Party (or
such shorter time period that would permit Alpharma a reasonable opportunity to respond in a timely manner), then Alpharma shall have the right, but not the duty, to defend and control any such invalidity action, counterclaim or defense in the
Territory; provided, however, that Alpharma’s right to undertake any the defense of such action relating to the [* * *] shall be subject to the prior written consent of Durect, not to be unreasonably withheld and also the applicable terms of
any agreements relating to the [* * *] entered into by Durect prior to the Effective Date, and with respect any actions defending the [* * *], subject to the applicable terms of the [* * *] Agreement. 
 (d) The Costs of any such action under this Section 9.5 (including fees of attorneys and other professionals) shall be borne by the Party defending
the action, or, if the Parties elect to cooperate in instituting and maintaining such action, such Costs shall be borne by the Parties in such proportions as they may agree in writing. For any such action, in the event that either Party is unable to
defend such action solely in its own name or it is otherwise advisable to obtain an effective remedy, the other Party will join such action voluntarily and will execute and cause its Affiliates to execute all documents necessary for the defending
Party to defend such action. Each Party shall at its own expense promptly give to the defending Party such reasonable assistance as the Party defending the action may reasonably request. The defending Party may not enter into any settlement, consent
judgment or other voluntary final disposition of such action that admits the invalidity or unenforceability of any Patent licensed hereunder, subjects the other Party to an injunction or requires the other Party to make any monetary payment without
the prior written consent of the other Party, not to be unreasonably withheld by the other Party. The Party undertaking any such defense shall keep the other reasonably informed of the progress of the action and shall consider the comments and
observations of the other in the proceedings. 
 9.6 Patent Infringement Claims. 
 (a) Each Party shall notify the other Party promptly in writing of any claim of, or action for, infringement of any Patents or misappropriation of trade
secret rights of any Third Party that is threatened, made or brought against either Party by reason of the development, manufacture, use, sale, offer for sale, importation or exportation of the Product in the Territory. 
  

					
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 (b) In the event of the institution of any suit by a Third Party against either Party for Patent
infringement involving the development, manufacture, use, sale, offer for sale, importation or exportation by or on behalf of Alpharma, its Affiliates or Sublicensees of the Product in the Territory after the Effective Date, Alpharma shall be
responsible for the defense of any such suit and, subject to the terms of this Section 9.6, Alpharma shall control such defense. Alpharma shall select defense counsel and, provided that Alpharma can do so without compromising attorney-client
privilege, regularly consult with Durect and its counsel to keep them reasonably informed on the progress and status of the suit. Durect shall assist Alpharma and cooperate in any such litigation at Alpharma’s request and Cost. No settlement,
compromise or other disposition of any such proceeding that subjects Durect to an injunction or requires Durect to make any monetary payment shall be entered into without Durect’s prior written consent, which consent will not be unreasonably
withheld. Notwithstanding the foregoing, Alpharma shall not have any obligation to defend Durect against any Third Party Patent infringement suit arising out of any breach by Durect of its representations and warranties hereunder. 
 (c) Alpharma shall be responsible for all Costs to defend any suit that it is responsible for under this Section 9.6, including all fees and costs
of attorneys, expert witnesses and other out-of-pocket litigation costs and all damages, penalties, court costs, attorney fees and other payments payable to any such Third Party, whether as a result of any judgment, award, settlement or otherwise
(such liability, “Patent Litigation Losses”); provided, however, Alpharma may offset [* * *] percent ([* * *]%) of all such Patent Litigation Losses against any future Royalties due to Durect for Net Sales in such applicable
Jurisdiction(s), provided that any such set-off (by itself or in combination with other set offs) may not reduce the Royalties to Durect for Net Sales in such applicable Jurisdiction(s) by more than [* * *] percent ([* * *]%) in any calendar
quarter. Without limiting Durect’s liability for any breach of Durect’s representations and warranties hereunder, Durect’s sole liability and Alpharma’s exclusive remedy against Durect for any Patent Litigation Losses shall be
Alpharma’s right of offset in accordance with Section 9.6(c). 
  

					
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 (d) In the event a Third Party threatens suit against either Party for Patent infringement involving
the development, manufacture, use, sale, offer for sale, importation, exportation, license or marketing of the Product in the Territory, the Parties shall confer with respect to the appropriate course of action, and if they determine that a
declaratory action is warranted, then with respect to such action, the provisions of this Section 9.6 shall apply thereto with respect to the prosecution of such action and the defense of any claims asserted in response thereto. 
 (e) In the event that either Party becomes aware of a Third Party Patent, under which, in the good faith reasonable judgment of such Party, it would be
advisable to obtain a license to avoid infringement or potential infringement by the development, manufacture or Commercialization of the Product in any Jurisdiction, such Party shall promptly notify the other Party. The Parties shall then confer in
good faith with respect to the appropriate course of action. Alpharma shall have the right to negotiate and obtain such a license and, subject to the terms of this Section 9.6(e) below and without limiting Durect’s liability for any breach
of its representations and warranties hereunder, Alpharma shall be solely responsible for all costs and obligations under such license (the “Third Party License Fees”), provided, however, that Alpharma may offset [* * *]
percent ([* * *]%) of all such Third Party License Fees against any future Royalties due to Durect for Net Sales in such applicable Jurisdiction(s) provided that any such set-off (by itself or in combination with other set offs) may not reduce the
Royalties to Durect for Net Sales in such applicable Jurisdiction(s) by more than [* * *] percent ([* * *]%) in any calendar quarter. Alpharma shall provide Durect with complete copies of the license agreement with such Third Party and other
material information in its possession in respect of such technology subject to any confidentiality provisions imposed by such Third Party. 
 9.7 Patent Term Extensions. Alpharma may select which, if any, Patents other than the [* * *] licensed hereunder for which patent term extension, adjustment or restoration or supplemental protection certificates (together with patent
term extensions, adjustments and restorations, collectively “Patent Term Extensions”) is to be sought or obtained. Subject to the terms of this Section 9.7, Alpharma will file for all such Patent Term Extensions at
Alpharma’s expense, and Durect will execute such authorizations and other documents and take such other actions as may be reasonably requested to obtain such Patent Term Extensions, including designating Alpharma as its agent for such purpose.

  

					
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 9.8 Prosecution of Durect Trademark. Durect shall use Commercially Reasonable Efforts to
register and maintain, or cause to be registered and maintained, the Durect Trademark in Jurisdictions as agreed upon by the Parties at Alpharma’s Cost. Durect shall furnish Alpharma with copies of all substantive prosecution correspondence to
and from trademark offices in the Territory and provide Alpharma a reasonable time to offer its comments thereon before Durect makes a submission to the relevant trademark office, provided that in the event that delay would jeopardize any
potential rights, Durect shall have the right to proceed without awaiting Alpharma’s comments on any application or correspondence relating to the Durect Trademark. Alpharma shall offer its comments promptly, and Durect shall consider in good
faith such comments of Alpharma and shall incorporate such comments if reasonable. Alpharma shall use the Durect Trademark, and all Products bearing the Durect Trademark shall be manufactured, in accordance with the trademark usage and quality
standards established by the JEC and approved by Durect, such approval not to be unreasonably withheld nor delayed; provided that, on a Jurisdiction-by-Jurisdiction basis, the JEC shall, if commercially reasonable, adopt any trademark
usage and quality standards timely proposed by Durect to the JEC prior to the First Commercial Sale in such Jurisdiction. 
 9.9
Enforcement of Durect and Product Trademarks. If either Party learns of any infringement or threatened infringement by a Third Party of the Durect Trademark or a Product Trademark in the Territory, such Party shall as soon as reasonably
practicable notify the other Party and will provide such other Party with all available evidence of such infringement or threatened infringement. Alpharma shall have the right, but not the obligation, to institute, prosecute and control, at its own
Cost, any action or proceeding with respect to any infringement or threatened infringement by a Third Party of the Durect Trademark or any Product Trademark in the Territory, by counsel of its own choice and, provided that Alpharma can do so without
compromising attorney-client privilege, shall regularly consult with Durect and its counsel to keep them reasonably informed on the progress and status of the suit. For any such action to terminate any such infringement, in the event that Alpharma
is unable to initiate or prosecute such action solely in its own name or it is otherwise advisable to obtain an effective remedy, 

  

					
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Durect will join such action voluntarily and will execute and cause its Affiliates to execute all documents necessary for Alpharma to initiate litigation and
maintain such action. Alpharma will control the action, including settlement thereof; provided, that no settlement or consent judgment or other voluntary final disposition of any such action brought by Alpharma to enforce the Durect Trademark
in the Territory pursuant to this Section 9.9 may be entered into without the prior written consent of Durect, such consent not to be unreasonably withheld, if such settlement would adversely affect the Durect Trademark (e.g., restrict the
rights or admit invalidity). Any damage award or other consideration resulting from any such action or proceeding shall be retained by Alpharma. 
 9.10 Maintenance of [* * *] Agreements. Until the expiration or termination of this Agreement, or in the case of the [* * *] Agreement, until such agreement is assigned to Alpharma, Durect: (a) shall not breach, or default under the
[* * *] Agreement or [* * *] Agreement, which breach or default would give rise, whether immediately or with the passage of time, to termination of the [* * *] Agreement or [* * *] Agreement or to any restriction of Durect’s rights thereunder
in a manner that would adversely affect the rights granted by Durect to Alpharma under this Agreement; and (b) without the prior written consent of Alpharma, shall not amend or terminate or allow to lapse (except for the natural expiration of
the [* * *] Agreement in accordance with its terms) the [* * *] Agreement or [* * *] Agreement, if such amendment, termination or lapse would adversely affect the rights granted by Durect to Alpharma under this Agreement. Alpharma acknowledges that
its sublicense to the [* * *] is subject to the applicable terms of the [* * *] Agreement. In addition, notwithstanding the foregoing, Durect shall not be deemed in breach of this Section 9.10 if such breach, default or termination of the [* * *]
Agreement is due to Alpharma’s failure to comply with the terms of the [* * *] Agreement which are applicable to Alpharma and have been fully disclosed to Alpharma prior to the Execution Date. [* * *]. 
  

	10.	PUBLICATION; CONFIDENTIALITY 

 10.1 Notification.
The Parties recognize that each may wish to publish the results of their work relating to the subject matter of this Agreement. However, the Parties also recognize the importance of acquiring patent protection and other considerations. Consequently,
subject to any Applicable Laws obligating any Party to do otherwise, any proposed publication by any 

  

					
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Party that may disclose Collaboration Inventions shall comply with this Section 10. At least [* * *] before a manuscript is to be submitted to a publisher,
the publishing Party will provide the other Party with a copy of the manuscript. If the publishing Party wishes to make an oral or visual presentation, it will provide the other Party with a summary of such presentation at least [* * *] before such
oral or visual presentation and, if an abstract is to be published, [* * *] before such abstract is to be submitted. Any oral or visual presentation, including any question period, shall not include any Confidential Information belonging to a Party
unless such Party agrees in writing to such inclusion in advance of such oral presentation. 
 10.2 Review. The other Party will
review the manuscript, abstract, text or any other material provided to it under Section 10.1 to determine whether patentable subject matter or valuable trade secrets of the reviewing Party are disclosed and to assess the accuracy of the
technical content therein. The other Party will notify the publishing Party within [* * *] of receipt of the proposed publication if such Party, in good faith, determines that patentable subject matter or valuable trade secrets of the reviewing
Party are or may be disclosed, or if the other Party, in good faith, believes Confidential Information of the reviewing Party is or may be disclosed. If it is determined by the other Party that patent applications should be filed in advance of the
proposed publication, the publishing Party shall delay its publication or presentation for a period not to exceed [* * *] from the other Party’s receipt of the proposed publication or presentation to allow time for the filing of patent
applications covering patentable subject matter. In the event that the delay needed to complete the filing of any necessary patent application will exceed the [* * *] period, the other Party will discuss the need for obtaining an extension of the
publication delay beyond the [* * *] period. If it is determined in good faith by a Party that Confidential Information or proprietary information of such Party is being disclosed, the Parties shall consult in good faith to arrive at an agreement on
mutually acceptable modifications to the proposed publication or presentation to avoid such disclosure. Any publications (whether written or oral), where consistent with customary academic practice, shall acknowledge Durect as the developer and
licensor of the Product. 
 10.3 Publicity. Neither Party shall make any public announcement concerning the existence of or the terms
of this Agreement and Durect shall not make any public announcement regarding the development or Commercialization of the Product in the Territory, without the 

  

					
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prior written approval of the other Party with regard to the form, content and precise timing of such announcement, except such as may be required to be made
by either Party in order to comply with applicable law, regulations, court order, or tax or securities filings. Such consent will not be unreasonably withheld or delayed by such other Party. Prior to any such public announcement requiring the other
Party’s prior written approval, the Party wishing to make the announcement will submit a draft of the proposed announcement to the other Party not less than [* * *] in advance to enable the other Party to consider and comment thereon. Failure
to respond with comments in writing prior to [* * *] before scheduled release shall be deemed approval of such release. Notwithstanding anything to the contrary in this Agreement, nothing in this Section 10.3 is intended to prohibit either
Party from republishing or restating information that has already been approved by the other Party for use in a prior press release or public announcement. Alpharma shall notify Durect in advance (at least [* * *] in advance if commercially
reasonable) of written public announcements or presentations and shall use reasonable efforts to notify Durect in advance of oral public announcements, in each case, by Alpharma of material new information regarding the development or
Commercialization of the Product and of public announcements by Alpharma of results of Clinical Trials. Any written public announcements or presentations shall include a standard statement in a form agreed to by the Parties stating that the Product
has been licensed from Durect. 
 10.4 Confidentiality. Except to the extent expressly authorized by this Agreement or otherwise
agreed in writing, the Parties agree that, during the Term of this Agreement and for [* * *] thereafter, the receiving Party, its Affiliates and its designees shall, and shall ensure that their respective employees, officers, directors and other
representatives shall, keep confidential and not publish or otherwise disclose and not use for any purpose, other than the development and Commercialization of the Product in the Territory, any information including all Know-How furnished to it by
the other Party, its Affiliates or its designees, except to the extent that it can be established by the receiving Party by competent proof that such information: (i) was already known to the receiving Party, other than under an obligation of
confidentiality, at the time of disclosure by the disclosing Party; (ii) was generally available to the public or otherwise part of the public domain at the time of its disclosure to the receiving Party; (iii) became generally available to
the public or was otherwise part of the public domain after its disclosure and other 

  

					
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than through any act or omission of the receiving Party in breach of this Agreement; (iv) was disclosed to the receiving Party, other than under an
obligation of confidentiality, by a Third Party who had, to the receiving Party’s knowledge, no legal obligation not to disclose such information to others; or (v) was independently generated by the receiving Party without reference to
Confidential Information of the disclosing Party (all such information to which none of the foregoing exceptions applies, and the terms of this Agreement, shall be deemed “Confidential Information”). Any and all information, data
and materials, including any and all Intellectual Property Rights therein and thereto, owned by a Party shall constitute Confidential Information of such Party which shall be deemed the disclosing Party with respect to such Confidential Information
for the purposes of this Section 10. Notwithstanding the foregoing, the obligations of confidentiality under this Section 10.4 regarding any Confidential Information relating to or containing a Party’s trade secret that has been
suitably identified to the other Party as such shall continue beyond the period set forth in this Section 10.4 (i.e., the Term plus [* * *]) so long as the subject matter remains a trade secret. 
 10.5 Exceptions to Obligation. The restrictions contained in Section 10.4 shall not apply to Confidential Information that: (i) is submitted
by the recipient to a Regulatory Authority to obtain Regulatory Approval for the Product; (ii) is provided by the recipient to Third Parties under confidentiality provisions at least as stringent as those in this Agreement, in connection with
consulting, development, manufacturing, external testing, or Commercialization of the Product or in connection with a proposed financing transaction, merger, acquisition or other change of control of a Party or sale of all or substantially all of
the assets of a Party; or (iii) is otherwise required to be disclosed in compliance with applicable laws or regulations or order by a court or other regulatory body having competent jurisdiction, including ; provided that, if a Party is
required to make any such disclosure of the disclosing Party’s Confidential Information, such Party will, except where impracticable for necessary disclosures (for example, to physicians conducting studies or to health authorities), give
reasonable advance notice to the disclosing Party of such disclosure requirement and reasonably cooperate with the disclosing Party to secure confidential treatment of such Confidential Information required to be disclosed. 
 10.6 Limitations on Use. Each Party shall use, and cause each of its Affiliates and its licensees to use, any Confidential Information obtained by
such Party from the disclosing Party, its Affiliates or its licensees, pursuant to this Agreement or otherwise, solely in connection with the activities or transactions contemplated by this Agreement. 
  

					
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 10.7 Remedies. Each Party shall be entitled, in addition to any other right or remedy it may
have, at law or in equity, to seek an injunction, without the posting of any bond or other security, enjoining or restraining the other Party, its Affiliates and/or its licensees from any violation or threatened violation of this Section 10.

  

	11.	REPRESENTATIONS AND WARRANTIES 

 11.1 Representations
and Warranties of the Parties. 
 Each Party represents and warrants to the other Party that as of the Execution Date: 
 (a) Such Party is duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has full corporate
power and authority to enter into this Agreement and to carry out the provisions hereof; 
 (b) Such Party has taken all corporate action
necessary to authorize the execution and delivery of this Agreement and the performance of its obligations under this Agreement and has full power and authority to enter into this Agreement and perform its obligations under this Agreement;

 (c) This Agreement has been duly executed by such Party and constitutes a valid and legally binding obligation of such Party, enforceable
in accordance with its terms, subject to and limited by: (i) applicable bankruptcy, insolvency, reorganization, moratorium, and other laws generally applicable to creditors’ rights; and (ii) judicial discretion in the availability of
equitable relief; 
 (d) With the exception of required Regulatory Approvals and HSR clearance, such Party has obtained, or is not required
to obtain, the consent, approval, order, or authorization of any Third Party, or has completed, or is not required to complete, any registration, qualification, designation, declaration or filing with, any Governmental Entity, in connection with the
execution and delivery of this Agreement and the performance by such Party of its obligations under this Agreement, including any grant of rights to the other Party pursuant to this Agreement; 
  

					
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 (e) The execution and delivery of this Agreement, and the performance by such Party of its
obligations under this Agreement, including the grant of rights to the other Party pursuant to this Agreement, does not and will not: (i) conflict with, nor result in any violation of or default under any instrument, judgment, order, writ,
decree, contract or provision to which such Party is otherwise bound; (ii) give rise to any lien, charge or encumbrance upon any assets of such Party or the suspension, revocation, impairment, forfeiture or non-renewal of any material permit,
license, authorization or approval that applies to such Party, its business or operations or any of its assets or properties; or (iii) conflict with any rights granted by such Party to any Third Party or breach any obligation that such Party
has to any Third Party; 
 (f) Every officer and scientific employee of such Party has an obligation to assign his or her inventions to such
Party to the extent such inventions are within the scope of his or her activities for such Party with respect to this Agreement, and all such officers and scientific employees and every technical consultant retained by such Party to provide services
to such Party has an obligation to maintain the confidentiality of such Party’s confidential information; and 
 (g) As of the Effective
Date, each Party is in compliance with Section 3.4. 
 11.2 Additional Representations and Warranties of Durect. Durect hereby
further represents and warrants to Alpharma that as of the Execution Date: 
 (a) Durect is the sole owner of the Product Know-How, Product
Patent Rights, [* * *] in existence on the Effective Date and has a valid license under the [* * *], and has the right to grant to Alpharma the rights granted under this Agreement (including the right to develop, manufacture and Commercialize the
Product in the Territory). To the Knowledge of Durect, the Product Patent Rights, [* * *] are valid, in full force and effect and have been maintained to date, and are not the subject of any interference or opposition proceedings; 
 (b) Other than the [* * *] Agreement, Durect has not entered into any agreement with any Third Party pursuant to which royalties or other license fees
would be owed on the development, manufacture or Commercialization of the Product; 
  

					
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 (c) The [* * *] Agreement and [* * *] Agreement are in full force and effect. To the Knowledge of
Durect, the parties to such agreements are not in material default or breach of such agreements; 
 (d) Except for the [* * *] Agreement and
[* * *] Agreement, Durect is not party to any agreement with a Third Party, which if breached by or defaulted under by Durect, or terminated or amended or allowed to lapse, would adversely affect the rights granted by Durect to Alpharma under this
Agreement; 
 (e) Durect has not granted any license, consent, permission or other right or privilege under the Product Patents Rights,
Product Know-How, the [* * *] or the [* * *], other than this Agreement. The Patents listed on Schedules 1.31, 1.62, 1.63 and 1.70 include all Patents currently Controlled by Durect relating to Product; 
 (f) [* * *]; 
 (g) [* * *]; 
 (h) There are no liens or security interests currently existing on or to the Product Know-How, Product Patent Rights, [* * *] or any proceeds thereof
that could reasonably be expected to adversely affect Alpharma’s benefits and rights under this Agreement; 
 (i) To the Knowledge of
Durect, all of the studies, tests and Pre-clinical and Clinical Trials of the Product conducted prior to, or being conducted as of, the Execution Date were conducted, or are being conducted, in accordance with Applicable Laws, and in the case of
Clinical Trials, the then valid cGCP. “cGCP” shall mean the current standards for Clinical Trials for drugs, as set forth in the FDC Act and applicable FDA regulations (including without limitation 21 C.F.R. Parts 50, 54 and 56) and
guidances promulgated thereunder, as amended from time to time; 
 (j) Durect has disclosed, shown or made available (e.g., through the
electronic data room) to Alpharma all material information and data (including without limitation all communications with or from the FDA or any other Regulatory Authority) relating to the results of all Preclinical and Clinical studies of the
Product conducted by or on behalf of Durect including, without limitation, with respect to the status and interim results of ongoing Clinical and Preclinical studies and Regulatory Approval activities; and 
  

					
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 (k) The documentation made available by Durect as requested by Alpharma in connection with
Alpharma’s due diligence in entering into this Agreement, to Durect’s Knowledge is, in all material respects, true, complete and unredacted (except as expressly noted in such documentation). Without limiting the generality of the
foregoing, to Durect’s Knowledge, all reports and other data summaries provided to Alpharma by Durect prior to the Effective Date relating to the Preclinical, Non-Clinical and Clinical studies of the Product accurately represent the underlying
raw data in all material respects. Durect has provided to, or made available for review by, Alpharma all reports and data collections containing information about adverse safety issues (including adverse drug experiences) related to the Product of
which Durect has Knowledge. 
 11.3 Disclaimer of Other Warranties. EXCEPT AS SET FORTH IN THIS AGREEMENT, THE PARTIES MAKE NO
REPRESENTATIONS AND EXTEND NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, INCLUDING WARRANTIES OF QUALITY, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR NON-INFRINGEMENT. 
 11.4 Survival of Representations. The representations and warranties set forth in this Agreement shall survive indefinitely. 
  

	12.	INDEMNIFICATION; INSURANCE 

 12.1 Indemnification by
Durect. Durect shall indemnify, defend and hold Alpharma and its Affiliates, and their respective directors, officers, employees and agents (each a “Alpharma Related Party”) harmless from and against any and all damages, losses,
judgments, penalties, fines, settlements, and costs and expenses (including reasonable fees of attorneys and other professionals) (“Damages”) arising out of Third Party claims that result from any breach by Durect of this
Agreement including breach by Durect of its representations and warranties hereunder. 
 12.2 Indemnification by Alpharma. Alpharma
shall indemnify, defend and hold Durect and its Affiliates and their respective directors, officers, employees and agents (each a “Durect Related Party”) harmless from and against any and all Damages arising out of Third Party
claims that result from: (i) any breach by Alpharma of this Agreement, including breach by 

  

					
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Alpharma of its representations and warranties hereunder or (ii) the development or Commercialization of the Product by Alpharma, its Sublicensees,
Affiliates or designees under this Agreement. 
 12.3 Shared Liability. If Damages arise out of Third Party claims that are subject to
indemnification by Alpharma under Section 12.2 and also subject to indemnification by Durect under Section 12.1, then the Parties shall indemnify each other to the extent of their respective liability for the Damages. In the event that the
Parties cannot agree to their respective indemnity obligations hereunder, a Party shall be free at any time to seek resolution of the respective indemnity obligations of the Parties under this Section 12 pursuant to the provisions set forth in
Section 14.12. 
 12.4 Indemnification Procedure. Upon receipt by the Party seeking indemnification hereunder (an “Indemnified
Party”) of notice of any action, suit, proceeding, claim, demand or assessment against such Indemnified Party which might give rise to Damages, the Indemnified Party shall give prompt written notice thereof to the Party from which
indemnification is sought (the “Indemnifying Party”) indicating the nature of the claim and the basis therefore, provided that the failure to give such prompt notice shall not relieve the Indemnifying Party of its obligations
hereunder except to the extent the Indemnifying Party or the defense of any such claim is materially prejudiced thereby. The Indemnifying Party shall have the right, at its option, to assume the defense of, at its own Cost and by its own counsel,
any such claim involving the asserted liability of the Indemnified Party. If any Indemnifying Party shall undertake to compromise or defend any such asserted liability, it shall promptly notify the Indemnified Party of its intention to do so, and
the Indemnified Party shall agree to cooperate fully with the Indemnifying Party and its counsel in the compromise of, or defense against, any such asserted liability; provided, however, that the Indemnifying Party shall not, as part of any
settlement or other compromise, admit to liability for which the Indemnifying Party is not fully indemnifying the Indemnified Party or agree to an injunction with respect to activities of the Indemnified Party without the written consent of the
Indemnified Party. Notwithstanding an election by the Indemnifying Party to assume the defense of any claim as set forth above, such Indemnified Party shall have the right (at its own Cost if the Indemnifying Party has elected to assume such
defense) to employ separate counsel and to participate in the defense of any claim. 
  

					
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 12.5 Cost of Enforcement. All Costs incurred by an Indemnified Party in connection with
enforcement of its rights under Sections 12.1, 12.2 and 12.3, as applicable, shall also be reimbursed by the Indemnifying Party (or, in the case of Section 12.3, allocated between the Parties in accordance with Section 12.3) promptly after
final determination that such Indemnified Party is entitled to such indemnification by the Indemnifying Party. 
 12.6 LIMITATION ON
DAMAGES. IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER, WHETHER PURSUANT TO THE FOREGOING INDEMNIFICATION OBLIGATIONS OR OTHERWISE UNDER THIS AGREEMENT, FOR SPECIAL, EXEMPLARY OR CONSEQUENTIAL DAMAGES, INCLUDING BUSINESS INTERRUPTION OR
LOST PROFITS, OR PUNITIVE DAMAGES; PROVIDED, HOWEVER, THIS EXCLUSION IS NOT INTENDED TO, NOR SHALL, EXCLUDE ACTUAL OR COMPENSATORY DAMAGES OF THE AFFECTED PARTY, INCLUDING SPECIAL, EXEMPLARY OR CONSEQUENTIAL DAMAGES, OWED TO THIRD PARTIES AS A
RESULT OF A THIRD PARTY CLAIM. 
 12.7 Insurance. Each Party shall carry and maintain in full force and effect while this Agreement is
in effect reasonable insurance in view of its obligations hereunder but in amounts no less than that specified for each type: 
 (a)
Commercial general liability insurance with combined limits of not less than $[* * *] per occurrence and $[* * *] per accident for bodily injury, including death, and property damage; 
 (b) Workers’ compensation insurance in the amounts required by the law of the Jurisdictions, countries or states in which such Party’s workers
are located; and 
 (c) Products liability insurance with a policy limit of at least $[* * *] per occurrence and in the aggregate.

 Each Party hereto shall name the other Party hereto as an “additional insured” on all commercial and product liability policies
relating to the insurance described in Sections 12.7(a) and (c). Each Party upon request shall provide the other with evidence of such insurance. Each Party shall provide to the other 30 calendar days’ prior written notice of any proposed
cancellation, termination, reduction or change in its coverage. 
  

					
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	13.	TERM AND TERMINATION 

 13.1 Term of Agreement. This
Agreement shall become effective as of the Effective Date and remain in effect on a Jurisdiction-by-Jurisdiction basis until the expiration of the applicable Royalty Term or earlier termination of this Agreement (the “Term”). Upon
the expiration of the applicable Royalty Term in a Jurisdiction (but not upon the earlier termination of this Agreement), the rights and licenses granted to Alpharma under this Agreement with respect to the Product in such Jurisdiction shall convert
to fully paid-up, non-royalty-bearing, perpetual rights and licenses. 
 13.2 Condition Precedent  
 (a) HSR Compliance. Each Party shall use commercially diligent efforts to satisfy any applicable requirements under the HSR, and the regulations
promulgated thereunder, including by making an initial HSR filing as soon as practicable after the Execution Date. This Agreement will not be effective until the date (“Effective Date”) of satisfaction of any such requirements and
the expiration or termination of all applicable waiting periods (including any early termination or extensions thereof). The obligations, rights, duties and liabilities under this Agreement (except those contained in this Section 13.2 and
Sections 10 and 11 of this Agreement) shall not be effective until the Effective Date. 
 (b) Cooperation. Each Party shall cooperate
with the other Party in the prompt preparation, execution and filing of all documents that are required or permitted to be filed pursuant to HSR, and to notify the other Party upon receipt of any formal or informal requests for information from any
antitrust agency in connection with any filings under HSR. Each Party shall bear its own Costs with respect thereto (provided, however, the filing fees for HSR, if applicable, shall be paid by Alpharma). 
 (c) Termination Right. If the Effective Date has not occurred within six (6) months after the Execution Date, notwithstanding that each Party
having fulfilled its obligations under this Section, either Party has the right to terminate this Agreement without liability to the other Party by notice in writing with immediate effect. 
  

					
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 13.3 Termination by Alpharma. 
 (a) Without Cause. Alpharma may terminate this Agreement without cause upon six (6) months’ prior written notice at any time. In such
event, during the six-month notice period, [* * *] provided that it shall not be obligated to [* * *]; provided that, (i) [* * *] and (ii) if [* * *]. 
 (b) Safety. If during the development or commercialization of the Product, the Product becomes subject to one or more Serious Adverse Drug Experiences (as defined below) or either Party receives notice from a
regulatory authority, independent review committee, data safety monitoring board or another similar Clinical Trial or post-marketing monitoring body alleging significant concern regarding a patient safety issue, in each case which Alpharma, in good
faith, reasonably believes would seriously impact the long-term viability of the Product, Alpharma shall have the right, upon [* * *] prior written notice to Durect setting forth the reasons therefor, to have the JEC determine whether or not there
exists such serious impact on the long-term viability of the Product and what, if anything, the Parties should do to address the matter. In the event the JEC is unable to reach consensus on resolution of the matter within [* * *] of the matter being
referred to the JEC, Alpharma may terminate its rights and obligations under this Agreement upon written notice so long as Alpharma reasonably believes the patient safety issue would seriously impact the long-term viability of the Product. During
the foregoing notice and resolution periods, Alpharma may take any actions that it reasonably determines are necessary to address such safety concerns. For purposes of this Agreement, a “Serious Adverse Drug Experience” means any
adverse drug experience occurring at any dose that results in any of the following outcomes: death, a life-threatening adverse drug experience, inpatient hospitalization or prolongation of existing hospitalization, a persistent or significant
disability/incapacity, or a congenital anomaly/birth defect. Important medical events that may not result in death, be life-threatening, or require hospitalization may be considered a Serious Adverse Drug Experience when, based upon appropriate
medical judgment, they may jeopardize the patient or subject and may require medical or surgical intervention to prevent one of the outcomes listed in this definition. 
 13.4 Termination for Material Breach. Upon the material breach by one Party under this Agreement, the other Party shall notify the breaching Party of such breach, and require that the breaching Party cure such
breach within [* * *] or, in the case of payment defaults, within [* * *], 

  

					
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or in the case of a breach that cannot be cured within [* * *], within a reasonable period not exceeding [* * *] so long as the breaching party is diligently
proceeding to cure such default. In the event that a material breach by such Party is not cured within the applicable cure period and without limiting other available remedies, the other Party shall have the right to terminate this Agreement upon
written notice. Notwithstanding the foregoing provisions of this Section 13.4, (a) the provisions of Sections 4.2(c) and 4.3(d) and not this Section 13.4 shall control the Parties’ remedies and liabilities with respect to the
matters set forth therein and (b) in the case of any bona fide dispute regarding an alleged material breach that is submitted to arbitration pursuant to Section 14.12, the non-breaching Party shall not have the right to terminate this
Agreement pursuant to this Section 13.4 until a final arbitration award determines that such breach has occurred and, if such breach is a failure to pay amounts due under this Agreement which payment is disputed in good faith by the breaching
Party, this Agreement shall not terminate pursuant to this Section 13.4 based on such payment breach if the breaching Party pays the amounts finally determined to be due, with interest calculated in the manner set forth in Section 7.6, if
applicable, within [* * *] after the final arbitration award is rendered. 
 13.5 Termination for Patent Challenge. In the event that
Alpharma or any of its Affiliates or Sublicensees commences or otherwise pursues, directly or indirectly (or voluntarily assists Third Parties to do so, other than as required by law or legal process), any proceeding seeking to have any of the
Product Patent Rights, [* * *] revoked or declared invalid, unpatentable, or unenforceable, Durect may as its sole remedy terminate this Agreement upon written notice to Alpharma. 
 13.6 Termination for Bankruptcy. Either Party may immediately terminate this Agreement upon the occurrence of either of the following:
(a) the entry of a decree or order for relief by a court having jurisdiction in the premises in respect of the other Party in an involuntary case under any applicable national, federal, or state insolvency or other similar law, and the
continuance of any such decree or order unstayed and in effect for a period of [* * *]; or (b) the filing by the other Party of a petition for relief under any applicable national, federal, or state insolvency or other similar law. 

 

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

 13.7 Effect of Termination. 
 In the event of termination of this Agreement or in the event Durect terminates Alpharma’s license in any Terminated Country in accordance with
Section 4.2(c) or 4.3(d): 
 (a) all licenses granted by Durect to Alpharma in Section 3 shall terminate in the Territory or
Terminated Country, as applicable; 
 (b) in the Territory or Terminated Country, as applicable, Alpharma shall or shall cause its Affiliates
and Sublicensees, if any, to assign or transfer to Durect, at no Cost (except as otherwise specifically provided in Section 13.7(e) below and except that, to the extent any such assignment or transfer to Durect requires more than [* * *] of
effort by Alpharma, its Affiliates and/or Sublicensees, Durect shall reimburse Alpharma, its Affiliates and/or Sublicensees for any such efforts in excess of [* * *] hours on the same basis that Alpharma reimburses Durect for Durect Development
Costs hereunder), all Regulatory Documentation, Development Data, Regulatory Approvals, Product Trademarks (and goodwill associated therewith) Controlled by Alpharma or its Affiliates and Sublicensees, if any, as applicable, that relate to the
development, manufacturing, use or sale of the Product (collectively, the “Product Material); 
 (c) if applicable, subject to
Section 13.3(b), Alpharma shall continue during the notice period before termination becomes effective (or if reasonably practicable and agreed to by Alpharma at such time, allow Durect or its Clinical research organizations
(“CROs”) to continue any ongoing Clinical Trial for which Alpharma has responsibility; and 
 (d) if Alpharma has
manufactured, or has had manufactured the Product for Clinical Trial or Commercialization, Alpharma at its option shall either transition the manufacturing process to Durect or a mutually agreed Third Party CMO or supply the Product to Durect;
provided, that if Alpharma chooses to transition the manufacturing process to Durect or a mutually agreed Third Party CMO, Alpharma will continue to supply the Product until the completion of the transition and associated Regulatory Approvals have
been received, but in no event for a period exceeding [* * *] from the date of termination, and further provided that during any period in which Alpharma continues to supply the Product to Durect, Durect shall pay Alpharma therefor [* * *]; provided
that, Alpharma shall not be required to establish or have established any new manufacturing process in order to satisfy its obligations under this Section 13.7(d) (e.g., if a commercial scale manufacturing process has not been established,
Alpharma shall not be required to establish or have established such a process); and 
  

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

 (e) In the event that Alpharma terminates this Agreement pursuant to Section 13.3(a) or Durect
terminates this Agreement pursuant to Section 13.4 above, and if [* * *] the Product in any Jurisdiction, then [* * *] of the Product; and (ii) in the case that [* * *], in each case received by [* * *] as a result of such license;
provided, however, notwithstanding the foregoing, [* * *] under this Section 13.7(e) once [* * *]. 
 (f) Alpharma will cooperate in any
reasonable manner requested by Durect to achieve a smooth transition of the development, manufacturing and Commercialization of the Product to Durect or its licensees in the Terminated Countries or Territory, as applicable; provided that, to the
extent any such cooperation (including the efforts required of Alpharma, its Affiliates and Sublicensees under Section 13.7(b)) requires more than [* * *] of effort by Alpharma, its Affiliates and/or Sublicensees, Durect shall reimburse
Alpharma, its Affiliates and/or Sublicensees for any such efforts in excess of [* * *] on the same basis that Alpharma reimburses Durect for Durect Development Costs hereunder. 
 13.8 Post-Termination. Upon and after termination of this Agreement, Durect shall indemnify, defend and hold harmless the Alpharma Related Parties
against any and all Damages incurred or suffered by any Alpharma Related Party, or with which any of them may be faced, to the extent arising out of or caused by the development, manufacture, distribution, marketing, promotion, sale or other use of
the Product by or on behalf of Durect or its Affiliates or licensees after the effective date of the termination. 
 13.9 Surviving
Provisions. Expiration or any termination of this Agreement shall not release a party from the obligations to make any payments that were due or had accrued immediately prior the effective date of such termination (including non-cancelable
obligations or commitments made in good faith prior to notice of termination), and the following Sections of this Agreement shall survive any expiration or termination of this Agreement for any reason: 
 (i) Sections 1, 3.3, 7.4, 7.5, 7.6, 9.1, 9.2(b), 9.2(d), 10.4-10.7, 11, 12, 13.1, 13.7-13.9 and 14, and (ii) Sections 9.6(a)-(d) (with respect to events
occurring during the Term of this Agreement). 
  

					
	CONFIDENTIAL	  	69	  	

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

	14.	MISCELLANEOUS PROVISIONS 

 14.1 Relationship of
Parties. Nothing in this Agreement is intended or shall be deemed to constitute a partnership, agency, employer-employee or joint venture relationship between the Parties. No Party shall incur any debts or make any commitments for the other,
except to the extent, if at all, specifically provided herein. 
 14.2 Assignment. Neither Party shall assign this Agreement or its
rights or obligations hereunder without the express written consent of the other Party hereto, except that either Party may assign or transfer this Agreement and its rights or obligations hereunder without the consent of the other Party to
(i) an Affiliate, (ii) any assignee of all or substantially all of its business or assets relating to the subject matter of this Agreement, or (iii) its successor in the event of its merger, consolidation or involvement in a similar
transaction. An assignment or transfer by a Party pursuant to this Section 14.2 shall be binding on its successors or assigns. No such assignment or transfer shall be valid or effective unless done in accordance with this Section 14.2.

 14.3 Books and Records. Any books and records to be maintained under this Agreement by a Party or its Affiliates shall be
maintained in accordance with GAAP. 
 14.4 Further Actions. Each Party shall execute, acknowledge and deliver such further
instruments, and do all such other acts, as may be reasonably necessary or appropriate in order to carry out the purposes and intent of this Agreement. 
 14.5 Notice. Any notice, request or other communication required or permitted to be given under or in connection with this Agreement shall be deemed to have been sufficiently given if in writing and personally
delivered, facsimile transmission (receipt verified), electronic mail or overnight express courier service (signature required), prepaid, to the Party for which such notice is intended, at the address set forth for such Party below: 
 In the case of Durect, to: 
 Durect
Corporation 
 2 Results Way 
 Cupertino, CA 95014 
 Attention: General Counsel 
 Facsimile No.: (408) 777-3577 
 Telephone No.: (408) 777-1417 
  

					
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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 In the case of Alpharma, to: 
 Alpharma Ireland Limited 
 Arthur Cox Building

 Earlsfort Terrace 
 Dublin 2,
Ireland 
 Attention: Director 
 Facsimile No.: 353 1 618 0618 
 Telephone No.: 353 1 618 0000 
 with a copy to: 
 Alpharma Inc. 

440 Route 22 
 Bridgewater, NJ 08807

 Attention: General Counsel 
 Facsimile No.: (908) 566-4139 
 Telephone No.: (908) 566-3800 
 or to such other address for such Party as it shall have specified by like notice to the other Party, provided that notices of a change of address shall be
effective only upon receipt thereof. If delivered personally or by facsimile transmission, the date of delivery shall be deemed to be the date on which such notice or request was given. If sent by overnight express courier service, the date of
delivery shall be deemed to be the next business day after such notice or request was deposited with such service. 
 14.6 Use of
Name. Except as otherwise provided herein, Durect, on the one hand, and Alpharma on the other hand, shall not have any right, express or implied, to use in any manner the name or other designation of the other or any other trade name, trademark
or logos of the other for any purpose, unless consented to in writing by the other Party. 
 14.7 Waiver. A waiver by any Party of any
of the terms and conditions of this Agreement in any instance shall not be deemed or construed to be a waiver of such term or condition for the future, or of any subsequent breach hereof. All rights, remedies, undertakings, obligations and
agreements contained in this Agreement shall be cumulative and except as specifically provided herein none of them shall be in limitation of any other remedy, right, undertaking, obligation or agreement of either Party. 
  

					
	CONFIDENTIAL	  	71	  	

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

 14.8 Counterparts. This Agreement may be executed simultaneously in any number of
counterparts, any one of which need not contain the signature of more than one Party but all such counterparts taken together shall constitute one and the same agreement. This Agreement, to the extent signed and delivered by means of a facsimile
machine (or pdf-file attachment to Email), shall be treated in all manner and respects and for all purposes as an original agreement or instrument and shall be considered to have the same binding legal effect as if it were the original signed
version thereof delivered in person. 
 14.9 Severability. When possible, each provision of this Agreement shall be interpreted in
such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be prohibited by or invalid under applicable law, such provision will be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of this Agreement. 
 14.10 Amendment. No amendment, modification or supplement of any
provisions of this Agreement shall be valid or effective unless made in writing and signed by a duly authorized officer of each Party. 
 14.11 Governing Law. This Agreement shall be governed by and interpreted in accordance with the laws of the State of New York without regard to conflicts of law principles. 
 14.12 Dispute Resolution. 
 (a) The
Parties recognize that a bona fide dispute as to certain matters may from time to time arise during the Term of this Agreement that relate to any Party’s rights or obligations hereunder. In the event of the occurrence of any Dispute (as defined
below), either Party may, by written notice to the other, have such Dispute referred to its highest ranking officer for attempted resolution by good faith negotiations within [* * *] after such notice is received. If either Party desires to pursue
arbitration under paragraph (b) below to resolve any such Dispute, unless expressly provided for otherwise herein, a referral to such executives under this paragraph (a) shall be a mandatory condition precedent. Said designated officers as
of the Effective Date are as follows. 
 For Durect: Chief Executive Officer 
 For Alpharma: Senior Vice President, Alpharma Pharmaceuticals LLC 
  

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

 In the event that they shall be unable to resolve the Dispute by consensus within such [* * *] period, then the
Dispute shall be finally settled by binding arbitration as provided below. 
 (b) Except as expressly otherwise provided in this Agreement,
any dispute arising out of or relating to the interpretation of any provisions of this Agreement or the failure of either Party to perform or comply with any obligation of such Party pursuant to this Agreement or the breach, termination or validity
hereof (a “Dispute”), shall be exclusively and finally settled by arbitration under the Commercial Arbitration rules of the American Arbitration Association (“AAA”) then in effect (the “Rules”), as
modified by the terms set forth in this Section 14.12(b). The place of arbitration of any Dispute shall be in New York, New York. Such arbitration shall be conducted by three arbitrators, one appointed by each of Alpharma and Durect and the
third selected by the party-appointed arbitrators. Each arbitrator shall be neutral and impartial and shall have relevant experience in the pharmaceutical industry. Alpharma and Durect shall make their respective appointments within [* * *] of
receipt by the respondent of a copy of the demand for arbitration. Such party-appointed arbitrators shall select the third arbitrator within [* * *] of the appointment of the second arbitrator. If any arbitrator is not timely appointed, on the
request of any Party such arbitrator shall be appointed by the AAA in accordance with the listing, striking and ranking provisions in the Rules. The arbitrators shall render an award as expeditiously as possible; if practicable, within six months
after the appointment of the third arbitrator. Any award rendered by the arbitrators shall be final and binding upon the Parties. Judgment upon any award rendered may be entered in any court having jurisdiction, or application may be made to such
court for a judicial acceptance of the award and an order of enforcement, as the case may be. Except as provided in Section 12.5, each Party shall pay its own Costs of arbitration, provided, however, the fees and expenses of the arbitrators
shall be equally shared between Alpharma and Durect. Any Costs (including attorney’s fees and expenses) incident to enforcing the award shall be charged against the Party resisting such enforcement. This Section 14.12 shall not prohibit a
Party from seeking preliminary injunctive relief in aid of arbitration from a court of competent jurisdiction in the event of a breach or prospective breach of this Agreement by any other Party which would cause irreparable harm to the Party seeking
such relief. Without prejudice to such provisional remedies as may be available under the jurisdiction of a court, the arbitrators 

  

					
	CONFIDENTIAL	  	73	  	

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

 
shall have full authority to grant provisional remedies and to direct the Parties to request that any court modify or vacate any temporary or preliminary
relief issued by such court, and to award damages for the failure of any Party to respect the arbitrators’ orders to that effect. 
 14.13 Compliance with Laws. Each Party shall review in good faith and cooperate in taking actions to ensure compliance of this Agreement and the Parties’ activities hereunder with all Applicable Laws. Each Party shall provide
the other Party such reasonable assistance as may be required for the Party requesting such assistance to comply with all Applicable Laws necessary to permit the Parties to perform hereunder and to exercise their respective rights hereunder.

 14.14 Force Majeure. Except where expressly provided for herein, neither Party shall be held liable or responsible to the other
Party nor be deemed to be in default under, or in breach of any provision of, this Agreement for failure or delay in fulfilling or performing any obligation of this Agreement to the extent that such failure or delay is due to Force Majeure, and
without the willful wrongdoing, recklessness or gross negligence of the Party so failing or delaying. For purposes of this Agreement, “Force Majeure” is defined as causes beyond the reasonable control of the Party, including acts of
God; changes in regulations or laws of any government; war; terrorism; civil commotion; destruction of production facilities or materials by fire, flood, earthquake, explosion or storm; labor disturbances; epidemic; and failure of public utilities
or common carriers. In the event that the ability of Durect or Alpharma to perform its obligations under this Agreement, as the case may be, shall be so affected, the affected Party shall immediately notify the other Party of such inability and of
the period for which such inability is expected to continue. The Party giving such notice shall thereupon be excused from such of its obligations under this Agreement as it is thereby disabled from performing for so long as it is so disabled and the
[* * *] thereafter. To the extent possible, each Party shall use Commercially Reasonable Efforts to minimize the duration of any Force Majeure. 
 14.15 Entire Agreement. This Agreement including schedules and exhibits thereto, including the Development Plan together with all other future written agreements entered into by the Parties and specifically made a part of this
Agreement, constitute the entire agreement between the Parties with respect to the subject matter of this Agreement and supersede all prior agreements and understandings, both oral and written, between the Parties with respect to the subject matter
of this Agreement. 
  

					
	CONFIDENTIAL	  	74	  	

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

 14.16 Parties in Interest. All of the terms and provisions of this Agreement shall be binding
upon, inure to the benefit of and be enforceable by the Parties hereto and their respective permitted successors and assigns. 
 14.17 No
Third Party Beneficiaries. Except for rights and obligations specifically referred to herein that apply to Affiliates, sublicenses or licensees of the Parties, nothing in this Agreement is intended to confer on any Person other than Durect or
Alpharma any rights or obligations under this Agreement, and there are no intended Third Party beneficiaries to this Agreement. 
 14.18
Descriptive Headings; Certain Terms. The descriptive headings of this Agreement are for convenience only, and shall be of no force or effect in construing or interpreting any of the provisions of this Agreement. 
 14.19 Fees and Payments. All fees and payments made by one Party to the other under this Agreement shall be deemed non-refundable unless expressly
provided to the contrary herein. 
 14.20 No Implied Licenses. Except as specifically and expressly granted in this Agreement, no
rights or licenses to any intellectual property rights are granted by either Party to the other, by implication, estoppel or otherwise, and each Party specifically reserves all its rights with respect to any intellectual property rights not
specifically granted hereunder. Furthermore, unless expressly provided otherwise herein, each Party may use and practice its own Intellectual Property Rights, technology and data in any manner not inconsistent with the terms of this Agreement
without the consent of the other Party and without obligation to notify the other Party of its intended use. 
 14.21 Information for
Financial Reporting. In addition to the reports provided by Alpharma pursuant to Section 7.1, Alpharma agrees to provide to Durect good faith non-binding estimates of Net Sales and other information reasonably necessary for Durect to
estimate the Royalties in each calendar month following the commercial launch of the Product within ten (10) days after the end of such month. Alpharma shall not have any liability for any inaccuracy in any such report. Each such report shall
constitute Confidential Information of Alpharma and 

  

					
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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 
shall not be disclosed by Durect to any Third Party other than to Durect’s accountants and auditors in confidence, except for any disclosures as may be
required to be made by Durect in order to comply with applicable law, regulations, court order, or tax or securities filings. 
 [REMAINDER OF
PAGE INTENTIONALLY LEFT BLANK] 
  

					
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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be executed by its duly authorized
representative as of the day and year first above written. 
  

			
	Durect Corporation
		
	By:	 	 /s/ James E. Brown

	Name:	 	James E. Brown
	Title:	 	President and Chief Executive Officer
	
	Alpharma Ireland Limited
		
	By:	 	 /s/ Keith Bernius

	Name:	 	Keith Bernius
	Title:	 	Director

  

					
	CONFIDENTIAL	  	77	  	

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information subject to the confidential treatment request. Omissions are designated as * * *. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 GUARANTEE 
 In consideration of Durect Corporation, a corporation organized and existing under the laws of the State of Delaware (“Durect”) entering into the foregoing Agreement (the
“Agreement”), Alpharma Inc., a corporation organized and existing under the laws of the State of Delaware (“Alpharma Parent”), hereby irrevocably and unconditionally guarantees to Durect, as principal and not as
surety, the performance of Alpharma Ireland Limited, a corporation organized and existing under the laws of Ireland (“Alpharma”) of all obligations of Alpharma to Durect under the Agreement. 
 Durect may enforce its rights under this Guarantee without first exercising any other remedy or right that Durect may have; provided that,
prior to enforcing its rights under this Guarantee, Durect shall have first made demand for performance upon Alpharma and Alpharma thereafter shall have failed to perform for the applicable cure period set forth in Section 13.4 of the
Agreement. If Durect decides to proceed to first exercise any other remedy or right, or to proceed against another party, Durect retains all of its rights under this Guarantee. 
 Alpharma Parent hereby agrees that any and all disputes, claims, actions or proceedings arising out of the execution, delivery or performance of this
Guarantee shall be subject to arbitration in accordance with Section 14.12 of the Agreement. 
 This Guarantee shall survive the
expiration or other termination of the Agreement and shall survive and apply regardless of any amendments, waivers, extensions, modifications or other changes in the obligations of Alpharma under the Agreement. 
  

			
	Alpharma Inc.
		
	By:	 	 /s/ Jeff Campbell

	Its:	 	Jeff Campbell, Executive Vice President and Chief Financial Officer
	Date:	 	September 19, 2008

  

					
	CONFIDENTIAL	  		  	

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

 Schedule 1.24 – Durect Development Costs 
 Development Costs are equal to the sum of the following, in each case incurred by Durect in the performance of the Development Program: (i) labor cost of
Durect’s research and development personnel charged as set forth below, (ii) direct outside expenditures, and (iii) capital asset expenditures. 
 [* * *] 
  

					
	CONFIDENTIAL	  		  	

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

 Schedule 1.31 – [* * *] 
 [* * *] 
  

					
	CONFIDENTIAL	  		  	

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

 Schedule 1.60 – Product Description 
 [* * *] 
  

					
	CONFIDENTIAL	  		  	

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

 Schedule 1.62 – Product Patent Rights 
 [* * *] 
  

					
	CONFIDENTIAL	  		  	

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

 Schedule 1.63 – [* * *] 
 [* * *] 
  

					
	CONFIDENTIAL	  		  	

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

 Schedule 1.70 – [* * *] 
 [* * *] 
  

					
		  		  	

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

 Schedule 2.1 – Initial Members of JEC 
 Durect MEMBERS 
 [* * *] 
 Alpharma MEMBERS 
 [* * *] 
 SECRETARY TBD 
  

					
		  		  	

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

 Schedule 2.2 – Initial Members of JDC 
 Durect MEMBERS 
 [* * *] 
 Alpharma MEMBERS 
 [* * *] 
  

					
		  		  	

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

 Schedule 2.6 – Alliance Managers 
 Alpharma: [* * *] 
 Durect: [* * *] 
  

					
		  		  	

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

 Schedule 4.3 – Mandatory Major Market Jurisdictions 
 The United Kingdom 
 Germany 
 France 
 Spain 
 Italy 
 Japan 
  

					
		  		  	

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

 Schedule 4.4 – Notice of Ophan Drug Status 
 (attached) 
 [* * *] 
  

					
		  		  	

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

 Schedule 6.2 – Exemplary Royalty Calculation 
 [* * *]Logitech, Inc. Management Deferred Compensation Plan

 EXHIBIT 10.1 
 

 
 LOGITECH INC. 
 MANAGEMENT DEFERRED COMPENSATION PLAN 
 ADOPTED EFFECTIVE JANUARY 1, 1997 
 AMENDED AND RESTATED EFFECTIVE JULY 1, 2002 
 FURTHER AMENDED AND RESTATED EFFECTIVE JULY 1, 2003 
 AND OCTOBER
31, 20051 
  

	 1
	 Note: The Plan is being administered in accordance with the terms of Section 409A of the Internal Revenue Code. The
terms are not reflected in the Plan document. 

 TABLE OF CONTENTS 
  

			
	 	  	Page
	 ARTICLE I TITLE AND DEFINITIONS
	  	2
	 1.1 Title
	  	2
	 1.2 Definitions
	  	2
		
	 ARTICLE II PARTICIPATION
	  	5
	 2.1 Participation
	  	5
		
	 ARTICLE III DEFERRAL ELECTIONS
	  	5
	 3.1 Elections to Defer Compensation
	  	5
	 3.2 Company Contributions
	  	6
	 3.3 Investment Elections
	  	6
		
	 ARTICLE IV ACCOUNTS
	  	7
	 4.1 Participant Accounts
	  	7
		
	 ARTICLE V VESTING
	  	8
	 5.1 Account
	  	8
		
	 ARTICLE VI GENERAL DUTIES
	  	9
	 6.1 Trustee Duties
	  	9
	 6.2 Company Contributions
	  	9
	 6.3 Department of Labor Determination
	  	9
	 6.4 Trust Agreement
	  	9
		
	 ARTICLE VII DISTRIBUTIONS
	  	9
	 7.1 Distribution of Deferred Compensation — Termination of Employment
	  	9
	 7.2 Early Distributions — Payout
	  	11
	 7.3 Early Distributions — Withdrawal
	  	11
	 7.4 Unforeseeable Emergency
	  	12
	 7.5 Inability To Locate Participant
	  	12
		
	 ARTICLE VIII ADMINISTRATION
	  	13
	 8.1 Committee
	  	13
	 8.2 Committee Action
	  	13
	 8.3 Powers and Duties of the Committee
	  	13
	 8.4 Construction and Interpretation
	  	14
	 8.5 Information
	  	14
	 8.6 Compensation, Expenses and Indemnity
	  	14
	 8.7 Quarterly Statements
	  	15
		
	 ARTICLE IX MISCELLANEOUS
	  	15
	 9.1 Unsecured General Creditor
	  	15
	 9.2 Restriction Against Assignment
	  	15
	 9.3 Withholding
	  	15

  

 i 

			
	 9.4 Amendment, Modification, Suspension or Termination
	  	15
	 9.5 Governing Law
	  	16
	 9.6 Receipt or Release
	  	16
	 9.7 Payments on Behalf of Persons Under Incapacity
	  	16
	 9.8 No Employment Rights
	  	16
	 9.9 Headings, etc. Not Part of Agreement
	  	16

  

 ii 

 LOGITECH INC. 
 MANAGEMENT DEFERRED COMPENSATION PLAN 
 This
Plan, effective as of January 1, 1997 (the “Effective Date”), is adopted by Logitech Inc. (the “Company”), acting on behalf of itself and its designated subsidiaries. The Plan was amended and restated effective as of
July 1, 2002 and further amended and restated effective as of July 1, 2003 and October 31, 2005.2 Throughout, the term
“Company” shall include wherever relevant any entity that is directly or indirectly controlled by the Company or any entity in which the Company has a significant equity or investment interest, as determined by the Company. 
 RECITALS 
 1. The Company wishes to
establish a supplemental retirement plan for the benefit of a select group of management or highly compensated employees of the Company. 
 2. The Company wishes to provide that the plan to be established shall be designated as the Logitech Inc. Management Deferred Compensation Plan (the “Plan”). 
 3. The Company wishes to provide under the plan for the payment of vested accrued benefits to Plan participants and their beneficiary or beneficiaries
(“Trust Beneficiaries”). 
 4. The Company wishes to provide under the Plan that the Company shall pay all of the accrued benefits
from its general assets. 
 5. The Company intends to enter into an agreement (the “Trust Agreement”) with a person or persons,
including an entity, who shall serve as trustee (the “Trustee”) under an irrevocable trust (the “Trust”) to be used in connection with the Plan. 
 6. The Company wishes to make contributions to the Trust so that such contributions to be held by the Trustee and invested, reinvested and distributed, all in accordance with the provisions of this Plan and the Trust
Agreement. 
 7. The Company intends that amounts allocated to the Trust and the earnings thereon shall be used by the Trustee to satisfy the
liabilities of the Company under the Plan with respect to each plan participant for whom an Account has been established and such utilization shall be in accordance with the procedures set forth herein. 
 8. The Company intends that the Trust be a “grantor trust” with the principal and income of the Trust treated as assets and income of the
Company for federal and state income tax purposes. 
  

	 2
	 Note: The Plan is being administered in accordance with the terms of Section 409A of the Internal Revenue Code. The
terms are not reflected in the Plan document. 

  

 1 

 9. The Company intends that the assets of the Trust shall at all times be subject to the claims of the
general creditors of the Company as provided in the Trust Agreement. 
 10. The Company intends that the existence of the Trust shall not
alter the characterization of the Plan as “unfunded” for purposes of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and shall not be construed to provide income to Plan participants under the Plan
prior to actual payment of the vested accrued benefits thereunder. 
 NOW THEREFORE, the Company does hereby establish the Plan as follows
and does also hereby agree that the Plan shall be structured, held and disposed of as follows: 
 ARTICLE I 
 TITLE AND DEFINITIONS 
 1.1
Title. This Plan shall be known as the Logitech, Inc. Management Deferred Compensation Plan. 
 1.2 Definitions. Whenever the
following words and phrases are used in this Plan, with the first letter capitalized, they shall have the meanings specified below. 
 “Account” means for each Participant the bookkeeping account maintained by the Committee that is credited with amounts equal to (1) the portion of the Participant’s Salary that he or she elects to defer, (2) the
portion of the Participant’s Bonus that he or she elects to defer, (3) the portion of the Participant’s Commissions that he or she elects to defer, (4) Company contributions trade to the Plan for the Participant’s benefit,
and (5) adjustments to reflect deemed earnings pursuant to Section 4.1(d). 
 “Beneficiary” or “Beneficiaries”
means the beneficiary last designated in writing by a Participant in accordance with procedures established by the Committee to receive the benefits specified hereunder in the event of the Participant’s death. No beneficiary designation shall
become effective until it is filed with the Committee during the Participant’s lifetime. 
 “Board of Directors” or
“Board” means the Board of Directors of the Company. 
 “Bonus” means any cash-based incentive compensation payable to a
Participant in addition to the Participant’s Salary. 
 “Code” means the Internal Revenue Code of 1986, as amended.

 “Commissions” means any cash-based commission compensation payable to a Participant. 
 “Committee” means the Committee appointed by the Board to administer the Plan in accordance with Article VIII. 
  

 2 

 “Company” means Logitech Inc., any successor corporation and any entity that is directly or
indirectly controlled by the Company or any entity in which the Company has a significant equity or investment interest, as determined by the Company. 
 “Compensation” means the Salary, Commissions and Bonus that the Participant is entitled to for services rendered to the Company. 
 “Deferral Base Amount” means the amount used for purposes of calculating a Participant’s death benefit pursuant to Section 7.1(c). A Participant’s Deferral Base Amount shall be the total
Compensation deferred by a deceased Participant for the Plan Year immediately preceding the Participant’s death; provided, however, that if the Participant did not make any deferrals for such Plan Year, or if the Participant deferred
Compensation for only a portion of the preceding Plan Year, then the Participant’s Deferral Base Amount shall be the sum of (i) the Compensation deferred by the Participant for the Plan Year of his or her death, plus (ii) an amount
determined by the Committee in its sole discretion to approximate the deferrals the Participant would have made for such Plan Year absent death making reasonable assumptions as to the Participant’s Compensation for such period and applying the
deferral percentages in effect at the time of the Participant’s death. 
 “Distributable Amount” means the amount credited to
a Participant’s Account. 
 “Early Retirement Date” means the date on which an Employee attains age 55. 
 “Effective Date” means January 1, 1997. 
 “Eligible Employee” means a common law employee of the Company who is on the payroll of Logitech Inc. and is designated as an Eligible Employee by the Committee. For Plan Years prior to January 1, 2006,
the Committee will designate an individual as an Eligible Employee only if his or her annual Salary equals or exceeds $115,000. For Plan Years beginning on or after January 1, 2006, the Committee will designate an individual as an Eligible
Employee only if (i) he or she was a Participant at any time prior to January 1, 2006 and his or her annual Salary equals or exceeds $115,000, or (ii) his or her annual Salary equals or exceeds $140,000, or
(iii) his or her combined Salary and target annual Commission equals or exceeds $140,000. The Committee will not designate an individual as an Eligible Employee on or after January 1, 2002, if he or she is considered an
“expatriate” under the Company’s policies. Only employees who are highly compensated or members of a select group of management shall be eligible to participate in the Plan. An individual’s status as an Eligible Employee for a
Plan Year shall be determined immediately prior to the first day of such Plan Year or, if applicable, immediately prior to the first day of his or her Initial Election Period. 
 “Fund” or “Funds” means one or more of the funds or contracts selected by the Committee pursuant to Section 3.3. 
 “Initial Election Period” for an Eligible Employee means the later of January 1, 1997 or the 30-day period following the Eligible
Employee’s date of hire or promotion. 
  

 3 

 “Insurable Participant” means a Participant who satisfies underwriting standards for the
issuance of life insurance determined by the insurance company selected by the Company to provide the pre-distribution death benefit described in Section 7.1(c). 
 “Interest Rate” means, for each Fund, an amount equal to the net rate of gain or loss on the assets of such Fund during each valuation period. 
 “Normal Retirement Date” means the date on which an Employee attains age 65. 
 “Participant” means any Eligible Employee who elects to defer Compensation in accordance with Section 3.1. 
 “Payment Eligibility Date” means the first day of the month following the calendar quarter in which a Participant terminates employment or
dies, or if not such date, as soon as administratively possible thereafter. 
 “Plan” means the Logitech Inc. Management Deferred
Compensation Plan set forth herein, now in effect, or as amended from time to time. 
 “Plan Year” means the 12-consecutive month
period beginning January 1 and ending December 31. 
 “Retirement Date” means a Participant’s Early or Normal
Retirement Date, as applicable. 
 “Salary” means the Employee’s base salary for the Plan Year. Salary excludes any other form
of compensation such as bonuses, restricted stock, proceeds from stock options or stock appreciation rights, severance payments, moving expenses, car or other special allowance, or any other amounts included in an Eligible Employee’s taxable
income that is not compensation for services. Deferral elections shall be computed before taking into account any reduction in taxable income by salary reduction under Code Sections 125 or 401(k), or under this Plan. 
  

 4 

 ARTICLE II 
 PARTICIPATION 
 2.1 Participation. An Eligible Employee shall become a Participant in the Plan
by electing to defer all or a portion of his or her Compensation in accordance with Section 3.1, by completing an application for the life insurance benefit described in Section 7.1(c), and complying with any applicable medical
underwriting requirements of the insurance company. 
 ARTICLE III 
 DEFERRAL ELECTIONS 
 3.1 Elections to Defer Compensation. 
 (a) Initial Election Period. Each Eligible Employee may elect to defer Compensation by filing with the Committee an election that
conforms to the requirements of this Section 3.1, on a form provided by the Committee, no later than the last day of his or her Initial Election Period. 
 (b) General Rule. Subject to the limitations set forth in paragraph (c) below, the amount of Compensation which an Eligible
Employee may elect to defer in 2002 and subsequent years is as follows: 
  

	 	(1)	Any whole percentage of Salary up to 80%; 

  

	 	(2)	Any whole percentage of Bonus up to 90%; and/or 

  

	 	(3)	Any whole percentage of Commissions up to 90%; 

 provided, however, that no
election shall be effective to reduce the Compensation paid to an Eligible Employee for a calendar year to an amount that is less than the amount necessary to pay applicable employment taxes (e.g., FICA, hospital insurance, SDI) payable with respect
to amounts deferred hereunder, amounts necessary to satisfy any other benefit plan withholding obligations, any resulting income taxes payable with respect to Compensation that cannot be so deferred, and any amounts necessary to satisfy any wage
garnishment or similar type obligations. 
 (c) Minimum Deferrals. For each Plan Year during which the Eligible
Employee is a Participant, the minimum dollar amount that may be deferred under this Section 3.1 is $2,500. 
 (d)
Effect of Initial Election. An election to defer Compensation during an Initial Election Period shall be effective with respect to Salary earned during the first pay period beginning after the Initial Election Period and to the Commissions
and Bonus payable during the Plan Year in which the election is made. 
  

 5 

 (e) Duration of Compensation Deferral Election. Any Compensation deferral election
made under paragraph (a) or paragraph (f) of this Section 3.1 shall remain in effect, notwithstanding any change in the Participant’s Compensation, until changed or terminated in accordance with the terms of this paragraph (e);
provided, however, that such election shall terminate for any Plan Year for which the Participant is not an Eligible Employee. A Participant may increase, terminate and, subject to the minimum deferral request of Section 3.1(c), decrease his or
her Compensation deferral election, effective for Salary earned (and in the case of Bonus and Commissions, paid with respect to services performed) during pay periods beginning after the beginning of the next succeeding Plan Year, by filing a new
election, in accordance with the terms of this Section 3.1, with the Committee on or before the preceding December 15. In addition, and notwithstanding anything in the Plan to the contrary, a Participant may request a termination of his or
her Compensation deferral election at any time in the event of an unforeseen financial hardship as determined by the Committee in its discretion. In the event the Committee permits a Participant to terminate his or her Compensation deferral
election, no further Compensation shall be deferred for the Participant’s Account, provided that the Participant may resume Compensation deferral effective for Compensation earned during pay periods beginning after the beginning of the next
succeeding Plan Year, by filing a new election, in accordance with the terms of Section 3.1, with the Committee on or before the preceding December 15. 
 (f) Elections Other Than Elections During the Initial Election Period. Any Eligible Employee who fails to elect to defer
Compensation during his or her Initial Election Period may subsequently become a Participant, and any Eligible Employee who has terminated a prior deferral election may elect to again defer Compensation, by filing an election, on a form provided by
the Committee, to defer Compensation as described in paragraph (b) above. An election to defer Compensation must be filed on or before December 15 and will be effective for Salary earned (and in the case of Bonus and Commissions, paid with
respect to services performed) during pay periods beginning after the following January 1. 
 3.2 Company Contributions. The
Company may, in its sole discretion, make discretionary contributions to the Accounts of one or more Participants at such times and in such amounts as the Board may determine. 
 3.3 Investment Elections. The Committee may, in its discretion, provide each Participant with a list of investment Funds available for
hypothetical investment, and the Participant may designate, on a form provided by the Committee, one or more Funds that his or 

  

 6 

 
her Account will be deemed to be invested in for purposes of determining the amount of earnings to be credited to that Account. The Committee may, from time
to tune, in its sole discretion select a commercially available fund or contract to constitute the Fund actually selected. The Interest Rate of each such commercially available fund or contract shall be used to determine the amount of earnings to be
credited to Participants’ Accounts under Section 4.1(d). 
 In making the designation pursuant to this Section 3.3, the
Participant may specify that all or any whole number percentage of his or her Account be deemed to be invested in one or more of the Funds offered by the Committee. Effective as of the end of any calendar month, a Participant may change the
designation made under this Section 3.3 by filing an election, on a form provided by the Committee, prior to the end of such month. If a Participant fails to elect a Fund under this Section 3.3, he or she shall be deemed to have elected a
money market or similar Fund. 
 The Company may, but need not, acquire investments corresponding to those designated by the Participants
hereunder, and it is not under any obligation to maintain any investment it may make. Any such investments, if made, shall be in the name of the Company, and shall be its sole property in which no Participant shall have any interest. 
 ARTICLE IV 
 ACCOUNTS

 4.1 Participant Accounts. 
 The Committee shall establish and maintain an Account for each Participant under the Plan. Each Participant’s Account shall be further divided into separate subaccounts (“investment fund subaccounts”), each of which
corresponds to an investment fund or contract elected by the Participant pursuant to Section 3.3(a). A Participant’s Account shall be credited as follows: 
 (a) As of the last day of each month, the Committee shall credit the investment fund subaccounts of the Participant’s Account with an
amount equal to Salary deferred by the Participant during each pay period ending in that month in accordance with the Participant’s election; that is, the portion of the Participant’s deferred Salary that the Participant has elected to be
deemed to be invested in a certain type of investment fund shall be credited to the investment fund subaccount corresponding to that investment fund. 
 (b) As of the last day of the month in which the Commissions or Bonus or partial Bonus would have been paid, the Committee shall credit the investment fund subaccounts of the Participant’s Account with an amount
equal to the portion of the Commissions or Bonus deferred by the Participant’s election; that is, the portion of the Participant’s deferred Commissions or Bonus that the Participant has elected to be deemed to be invested in a certain type
of investment fund shall be credited to the investment fund subaccount corresponding to that investment fund. 
  

 7 

 (c) As of the last day of the Plan Year or such earlier time or times as the Committee
may determine, the Committee shall credit the investment fund subaccounts of the Participant’s Account with an amount equal to the portion, if any, of any Company contribution made to or for the Participant’s benefit in accordance with
Section 3.3; that is, the portion of the Participant’s Company contribution, if any, that the Participant has elected to be deemed to be invested in a certain type of investment fund shall be credited to the investment fund subaccount
corresponding to that investment fund. 
 (d) As of the last day of each valuation period, each investment fund subaccount of
a Participant’s Account shall be credited with earnings in an amount equal to that determined by multiplying the balance credited to such investment fund subaccount as of the last day of the preceding valuation period by the Interest Rate for
the corresponding Fund selected by the Company. Valuations shall be effected monthly or daily, as determined by the Committee. 
 ARTICLE V

 VESTING 
 5.1
Account. 
 (a) Compensation Deferrals. A Participant’s Account attributable to Compensation deferred by a
Participant pursuant to the terms of this Plan, together with any amounts credited to the Participant’s Account under Section 4.1(d) with respect to such deferrals, shall be 100% vested at all times. 
 (b) Company Contributions. The value of a Participant’s Account attributable to any Company contributions pursuant to
Section 3.2 shall vest at such time or times as the Board shall specify in connection with any such contributions. Unless otherwise specified by the Board, Participants shall be 100% vested in such amounts, together with any amounts credited to
the Participant’s Account under Section 4.1(d) with respect to such amounts. 
  

 8 

 ARTICLE VI 
 GENERAL DUTIES 
 6.1 Trustee Duties. The Trustee shall manage, invest and reinvest the Trust
Fund as provided in the Trust Agreement. The Trustee shall collect the income on the Trust Fund, and make distributions therefrom, all as provided in this Plan and in the Trust Agreement. 
 6.2 Company Contributions. While the Plan remains in effect, the Company shall make contributions to the Trust Fund at least once each quarter.
The amount of any quarterly contribution shall be at the discretion of the Committee. At the close of each calendar year, the Company shall make an additional contribution to the Trust Fund to the extent that previous contributions to the Trust Fund
for the current calendar year are not equal to the total of the Compensation deferrals made by each Participant plus Company contributions, if any, accrued as of the close of the current calendar year. The Trustee shall not be liable for any failure
by the Company to provide contributions sufficient to pay all accrued benefits under the Plan in accordance with the terms of this Plan. 
 6.3 Department of Labor Determination. In the event that any Participants are found to be ineligible, that is, not members of a select group of highly compensated employees, according to a determination made by the Department of
Labor, the Committee shall take whatever steps it deems necessary, in its sole discretion, to equitably protect the interests of the affected Participants. 
 6.4 Trust Agreement. The Trust Agreement shall conform to the terms of the model trust described in Revenue Procedure 92-64 issued by the Internal Revenue Service. 
 ARTICLE VII 
 DISTRIBUTIONS 

 7.1 Distribution of Deferred Compensation — Termination of Employment. 
 (a) Employment Termination after Retirement Date, etc. In the case of a Participant who terminates employment with the Company on
or after his or her Retirement Date or as a result of the Participant’s long-term disability (as defined in the Company’s long-term disability plan for employees) or death, the Distributable Amount shall be paid to the Participant (and
after his death to his or her Beneficiary) in a lump sum on his or her Payment Eligibility Date. Notwithstanding the foregoing, a Participant described in the preceding sentence may elect quarterly installments over two, five, 10 or 15 years
beginning on the Participant’s Payment Eligibility Date, provided that his or her election is filed with the Committee at least one year prior to his or her Payment Eligibility Date. Notwithstanding this subsection, if the Participant’s
Distributable Amount is $25,000 or less, the Distributable Amount shall automatically be distributed in the form of a cash lump sum on the 

  

 9 

 
Participant’s Payment Eligibility Date. To the extent the Distributable Amount is paid in installments, the Participant’s Account shall continue to
be credited with earnings pursuant to Section 4.1(d) of the Plan and the installment amount shall be adjusted annually to reflect gains and losses until all amounts credited to his or her Account under the Plan have been distributed.

 (b) Employment Termination Before Retirement Date. In the case of a Participant whose Payment Eligibility Date
occurs for reasons other than a long-term disability, termination after attaining Retirement Age or death, the Distributable Amount shall be paid to the Participant in the form of a cash lump sum on the Participant’s Payment Eligibility Date.

 (c) Life Insurance (if applicable). In the case of a Participant who dies while employed by the Company, the
following benefits shall be provided: 
 (1) That portion of the death benefit of any life insurance policy purchased by the
Company to insure the life of the Participant (the “Policy”) which is equal to the lesser of (i) the actual Policy death benefit or (ii) 15 times the Participant’s Deferral Base Amount shall be paid to Participant’s
beneficiary under the Policy by the insurance company which issued the Policy. Any such Policy shall be subject to the conditions set forth in a “Split-Dollar Life Insurance Agreement” between the Participant and the Trustee, pursuant to
which the Participant may designate a beneficiary with respect to the portion of the Policy proceeds described in the preceding sentence in the event the Participant dies prior to terminating employment with the Company. The Participant shall have
the right to designate and change such beneficiary (which need not be his Beneficiary as determined under Section 1.2 hereof) at any time on a form provided by and filed with the insurance company, and the life insurance proceeds designated in
this paragraph (1) shall be paid to such beneficiary. 
 The benefit payable pursuant to this paragraph (1) shall be paid only with
respect to a Participant who is, at the time of death, deferring Compensation under the Plan. In addition, benefits shall be paid only if a Policy has been issued on the Participant’s life and is in force at the time of the Participant’s
death and any such payment shall be subject to all conditions and exceptions set forth in the Policy. Death benefits payable pursuant to this paragraph shall be in addition to any other Company-sponsored life insurance benefits under any other
Policy plan or program provided by the Company. Notwithstanding any provision of this Plan or any other document to the contrary, the Company shall not have any obligation to pay the Participant or his Beneficiary any amounts described in this
Section 7.1(c). Any such amounts shall be payable solely from the proceeds of the Policy, and if no Policy is in force, no payment shall be made. Furthermore, the Company is not obligated to maintain any Policy, and no death benefit shall be
payable hereunder if the Company has been notified by the Committee to discontinue the Policy for the Participant. In addition, no Policy shall be allocated to any Account. 
 (2) The Distributable Amount shall be paid to the Participant’s Beneficiary in a lump sum unless the Participant elected a quarterly
distribution under Section 7.1(a), in which case the Participant’s Account shall continue to be credited with earnings pursuant to Section 4.1(d) of the Plan until all amounts credited to his or her Account under the Plan have been
distributed. 
  

 10 

 (d) If the Participant is in pay status at the time of death, the Beneficiary shall be
paid the remaining quarterly installments as they come due. 
 7.2 Early Distributions — Scheduled In-Service Withdrawals.
Notwithstanding Section 7.1, a Participant may elect to receive all or a portion of his or her Accounts prior to terminating employment with the Company by filing an election (a “Payout Election”). A Participant may make a Payout
Election during the Initial Election Period or on or before the December 15 in any Plan Year. The Payout Election shall be made on a form provided by the Committee and shall be subject to such terms and conditions as the Committee may specify.
A Payout Election may not specify a date that is within two years beyond the end of the Plan Year in which the Payout Election is made and shall apply to all Compensation that is deferred by the Participant beginning (i) in the case of a Payout
Election made during the Initial Election Period, with the first pay period after the Initial Election Period, and (ii) in the case of a Payout Election made other than during the Initial Election Period, with the pay period beginning after the
following January 1, provided that the Participant may specify the Plan Years with respect to which deferred amounts will be distributed pursuant to a Payout Election. A Participant may either cancel or make a one-time deferral to a later date
of a Payout Election at least one year prior to the scheduled Payout date by filing a new distribution election with the Committee, subject to such other terms and conditions as the Committee may establish. A Participant who has made a one-time
deferral of a Payout Election may then cancel, but not further defer, a deferred Payout Election, by following the procedures in the preceding sentence. If a Participant cancels a Payout Election in accordance with this Section 7.2 the
distribution of the Participant’s Distribute Amount that was subject to the cancelled Payout Election shall be governed by Sections 7.1, 7.3 and 7.4. Notwithstanding the foregoing in this Section, in the event the Participant’s employment
with the Company terminates for any reason, the Participant’s Payout Election, if any, shall be disregarded, and the distribution of the Participant’s Distributable Amount shall be governed by Sections 7.1, 7.3 and 7.4. 
 7.3 Early Distributions — Withdrawal. Participants shall be permitted to withdraw amounts from their Accounts before termination of their
employment with the Company or the scheduled payout date under their Payout Election, or, in the case of a Participant who terminated employment with the Company on or after his or her Retirement Date and elected payment of his or her Distributable
Amount in quarterly installments, such Participant shall be permitted to withdraw amounts from his or her Account after the termination of employment with the Company (“Early Distributions”), subject to the following restrictions:

 (a) The election to take an Early Distribution shall be made by filing a form provided by and filed with the Committee
prior to the end of any calendar month. 
  

 11 

 (b) The amount payable to a Participant in connection with an Early Distribution shall in
all cases equal 90% of the amount requested by the Participant; provided, however, that the maximum amount payable to a Participant in connection with an Early Distribution shall be 90% of the Distributable Amount as of the end of the calendar month
in which the Early Distribution election is made. 
 (c) The amount described in subsection (b) above shall be paid in a
single cash lump sum as soon as practicable after the end of the calendar month in which the Early Distribution election is made. 
 (d) If a Participant receives an Early Distribution, the remaining portion of the requested amount, as applicable (i.e., 10% of such amount), shall be permanently forfeited and the Company shall have no obligation to the Participant or his
Beneficiary with respects to such forfeited amount. 
 (e) If a Participant receives an Early Distribution, the Participant
shall be ineligible to Participate in the Plan for the balance of the Plan Year in which the Early Distribution occurs and the following Plan Year. 
 (f) A Participant shall be limited to a maximum of two Early Distributions during all of his or her periods of Plan Participation. 
 7.4 Unforeseeable Emergency. The Committee may, pursuant to rules adopted by it and applied in a uniform manner, accelerate the date of distribution of a Participant’s Account because of an Unforeseeable
Emergency at any time. “Unforeseeable Emergency” shall mean an unforeseeable, severe financial condition resulting from (a) a sudden and unexpected illness or accident of the Participant or his or her dependent (as defined in
Section 152(a) of the Code); (b) loss of the Participant’s property due to casualty, or (c) other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant, but
which may not be relieved through other available resources of the Participant, as determined by the Committee in accordance with uniform rules adopted by it. Distribution pursuant to this subsection of less than the Participant’s entire
interest in the Plan shall be made pro rata from his or her assumed investments according to the balances in such investments. Subject to the foregoing, payment of any amount with respect to which a Participant has filed a request under this
subsection shall be made as soon as practicable after approval of such request by the Committee. Any withdrawal approved by the Committee under this subsection shall be limited to the amount necessary to meet the Unforeseeable Emergency. 

7.5 Inability to Locate Participant. In the event that the Committee is unable to locate a Participant or Beneficiary within two years
following the Participant’s Payment Eligibility Date, the amount allocated to the Participant’s Deferral Account shall be forfeited. If, after such forfeiture, the Participant or Beneficiary later claims such benefit, such benefit shall be
reinstated without interest or earnings. 
  

 12 

 ARTICLE VIII 
 ADMINISTRATION 
 8.1 Committee. A Committee shall be appointed by, and serve at the pleasure
of, the Board. The number of members comprising the committee shall be determined by the Board which may from time to time vary the number of members. A member of the Committee may resign by delivering a written notice of resignation to the Board.
The Board may remove any member by delivering a certified copy of its resolution of removal to such member. Vacancies in the membership of the Committee shall be filled promptly by the Board. 
 8.2 Committee Action. The Committee shall act at meetings by affirmative vote of a majority of the members of the Committee. Any action permitted
to be taken at a meeting may be taken without a meeting if, prior to such action, a written consent to the action is signed by all members of the Committee and such written consent if filed with the minutes of the proceedings of the Committee. A
member of the Committee shall not vote or act upon any matter which relates solely to himself or herself as a Participant. The Chairman or any other member or members of the Committee designated by the Chairman may execute any certificate or other
written direction on behalf of the Committee. 
 8.3 Powers and Duties of the Committee. 
 (a) The Committee, on behalf of the Participants and their Beneficiaries, shall enforce the Plan in accordance with the terms, shall be
charged with the general administration of the Plan and shall have all powers necessary to accomplish its purposes, including, but not by way of limitation, the following: 
 (1) To select the funds or contracts to be the Funds in accordance with Section 3.3 hereof; 
 (2) To construe and interpret the terms and provisions of this Plan; 
 (3) To amend, modify, suspend or terminate the Plan in accordance with Section 9.4; 
 (4) To compute and certify to the amount and kind of benefits payable to Participants and their Beneficiaries and to direct the Trustee as
to the distribution of Plan assets; 
 (5) To maintain all records that may be necessary for the administration of the Plan;

 (6) To provide for the disclosure of all information and the filing or provision of all reports and statements to
Participants, Beneficiaries or governmental agencies as shall be required by law; 
  

 13 

 (7) To make and publish such rules for the regulation of the Plan and procedures for the
administration of the Plan as are not inconsistent with the terms hereof; and 
 (8) To appoint a plan administrator or any
other agent, and to delegate to them such powers and duties in connection with the administration of the Plan as the Committee may from time to time prescribe. 
 8.4 Construction and Interpretation. The Committee shall have full discretion to construe and interpret the terms and provisions of this Plan, which interpretation or construction shall be final and binding on
all parties, including but not limited to the Company and any Participant or Beneficiary. The Committee shall administer such terms and provisions in a uniform and nondiscriminatory manner and in full accordance with any and all laws applicable to
the Plan. 
 8.5 Information. To enable the Committee to perform its functions, the Company shall supply full and timely information
to the Committee on all matters relating to the Compensation of all Participants, their death or other cause of termination, and such other pertinent facts as the Committee may reasonably require. 
 8.6 Compensation, Expenses and Indemnity. 
 (a) The members of the Committee shall serve without compensation for their services hereunder. 
 (b) The Committee is authorized at the expense of the Company to employ such legal counsel as it may deem advisable to assist in the performance of its duties hereunder. Expenses and fees in connection with the administration of the Plan
shall be paid by the Company. 
 (c) To the extent permitted by applicable state law, the Company shall indemnify and save
harmless the Committee and each member thereof, the Board and any delegate of the Committee who is an employee of the Company against any and all expenses, liabilities and claims, including legal fees to defend against such liabilities and claims
arising out of their discharge in good faith of responsibilities under or incident to the Plan, other than expenses and liabilities arising out of willful misconduct. This indemnity shall not preclude such further indemnities as may be available
under insurance purchased by the Company or provided by the Company under any bylaw, agreement or otherwise, as such indemnities are permitted under state law. 
  

 14 

 8.7 Quarterly Statements. Under procedures established by the Committee, a Participant shall
receive a statement, with respect to such Participant’s Account on a quarterly basis. 
 ARTICLE IX 
 MISCELLANEOUS 
 9.1 Unsecured
General Creditor. Participants and their Beneficiaries, heirs, successors, and assigns shall have no legal or equitable rights, claims, or interests in any specific property or assets of the Company. Any and all of the Company’s assets
shall be, and remain, the general unpledged, unrestricted assets of the Company. The Company’s obligation under the Plan shall be merely that of an unfunded and unsecured promise of the Company to pay money in the future, and the rights of the
Participants and Beneficiaries shall be no greater than those of unsecured general creditors. It is the Company’s intention that the Plan shall be treated as unfunded for tax purposes and for purposes of Title I of ERISA. 
 9.2 Restriction Against Assignment. The Company shall pay all amounts payable hereunder only to the person or persons designated by the Plan and
not to any other person or corporation. No part of a Participant’s Account shall be liable for the debts, contracts, or engagements of any Participant, his or her Beneficiary, or successors in interest, nor shall a Participant’s Account be
subject to execution by levy, attachment, or garnishment or by any other legal or equitable proceeding, nor shall any such person have any right to alienate, anticipate, commute, pledge, encumber, or assign any benefits or payments hereunder in any
manner whatsoever. If any Participant, Beneficiary or successor in interest is adjudicated bankrupt or purports to anticipate, alienate, sell, transfer, assign, pledge, encumber or charge any distribution or payment from the Plan, voluntarily or
involuntarily, the Committee, in its discretion, may cancel such distribution or payment (or any part thereof) to or for the benefit of such Participant, Beneficiary or successor in interest in such manner as the Committee shall direct. 

9.3 Withholding. There shall be deducted from each payment made under the Plan all taxes which are required to be withheld by the Company in
respect to such payment. The Company shall have the right to reduce any payment by the amount of cash sufficient to provide the amount of said taxes. 
 9.4 Amendment, Modification, Suspension or Termination. The Committee may amend, modify, suspend or terminate the Plan in whole or in part, except that no amendment, modification, suspension or termination
shall have any retroactive effect to reduce any amounts allocated to a Participant’s Account, provided that a termination or suspension of the Plan or any Plan amendment or modification that will significantly increase costs to the Company
shall be approved by the Board. In the event that this Plan is terminated, the disposition of the amounts credited to a Participant’s Deferral Account shall be at the sole discretion of the Committee. 
  

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 9.5 Governing Law. This Plan shall be construed, governed and administered in accordance with
ERISA and, to the extent that state law is not preempted by ERISA, the laws of the State of California. 
 9.6 Receipt or Release. Any
payment to a Participant or the Participant’s Beneficiary in accordance with the provisions of the Plan shall, to the extent thereof be in full satisfaction of all claims against the Committee and the Company. The Committee may require such
Participant or Beneficiary, as a condition precedent to such payment, to execute a receipt and release to such effect. 
 9.7 Payments on
Behalf of Persons Under Incapacity. In the event that any amount becomes payable under the Plan to a person who, in the sole judgment of the Committee, is considered by reason of physical or mental condition to be unable to give a valid receipt
therefore, the Committee may direct that such payment be made to any person found by the Committee, in its sole judgment, to have assumed the care of such person. Any payment made pursuant to such determination shall constitute a full release and
discharge of the Committee and the Company. 
 9.8 No Employment Rights. Neither participation in this Plan nor coverage under any
Policy shall confer upon any person any right to be employed by the Company nor any other right not expressly provided hereunder, under the Policy or under the Split-Dollar Life Insurance Agreement executed in connection therewith. 
 9.9 Headings, etc. Not Part of Agreement. Headings and subheadings in this Plan are inserted for convenience of reference only and are not to be
considered in the construction of the provisions hereof. 
 IN WITNESS WHEREOF, the Company has caused this document to be executed by its
duly authorized officer effective as of this 31st day of October, 2005. 
  

			
	LOGITECH INC.
		
	By:	 	/s/ Guerrino De Luca
	Name:	 	Guerrino De Luca
	Title:	 	President & CEO

  

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