Document:

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                                                                    Exhibit 10.5

                 CRANBURY FACILITIES SHARING AGREEMENT AND LEASE

          THIS FACILITIES SHARING AGREEMENT AND LEASE (this "Agreement"), made
                                                             ---------
and executed at New York, New York, as of ., 2001, between Carter-Wallace, Inc.,
a Delaware corporation ("Lessee") and Armkel, LLC ("Lessor"), a Delaware limited
                         ------                     ------
liability company (each of the Lessee and Lessor a "Party" and collectively, the
                                                    -----
"Parties").
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                                    RECITALS:

          WHEREAS, the Lessee and Lessor have executed and delivered an Asset
Purchase Agreement, dated as of May 7, 2001 (including the exhibits, schedules
and annexes thereto, the "Asset Purchase Agreement"), providing for, among other
                          ------------------------
things, the sale, conveyance, transfer, assignment and delivery to Lessor of all
of the Lessee's and its Affiliates' rights, title and interest in and to the
Purchased Assets (as defined in the Asset Purchase Agreement) and the assumption
by Lessor of all of the Assumed Liabilities (as defined in the Asset Purchase
Agreement), effective in each case immediately prior to the ABC Merger (as
hereinafter defined);

          WHEREAS, the Lessee, CPI Development Corporation, a Delaware
corporation ("ABC"), MedPointe Inc., a Delaware corporation ("Parent"), MCC
              ---                                             ------
Merger Sub Corporation, a Delaware corporation and a wholly owned subsidiary of
Parent ("Company Merger Sub"), and MCC Acquisition Sub Corporation, a Delaware
         ------------------
corporation and a wholly owned subsidiary of Parent ("ABC Merger Sub"), have
                                                      --------------
executed and delivered an Agreement and Plan of Merger, dated as of May 7, 2001
(including the exhibits, schedules and annexes thereto, the "Merger Agreement"),
                                                             ----------------
providing for, among other things, the merger of ABC Merger Sub with and into
ABC (the "ABC Merger") and the merger of Company Merger Sub with and into the
          ----------
Lessee; and

          WHEREAS, in connection with the transactions contemplated by the Asset
Purchase Agreement and the Merger Agreement, Lessor is willing to lease certain
premises to the Lessee and the Lessee desires to lease certain premises from
Lessor on the terms hereof.

          NOW, THEREFORE, in consideration of the mutual promises and covenants
hereinafter provided, intending to be legally bound hereby, Lessor and Lessee
hereby agree as follows:

                                    ARTICLE I

                                   DEFINITIONS

          1.1  General Terms. For purposes of this Agreement, the following
               -------------
terms have the meanings hereinafter indicated:

          "Affiliate" means, with respect to any Person, any other Person
           ---------
directly or indirectly controlling, controlled by or under common control with
such Person as of the time of determination.

          "Bankruptcy Event" with respect to a Party shall mean the filing of an
           ----------------
involuntary petition in bankruptcy or similar proceeding against such Party
seeking its reorganization, liquidation or the appointment of a receiver,
trustee or liquidator for it or for all or substantially all of its assets,
whereupon such petition shall not be dismissed within 60 calendar days after the
filing thereof, or if such Party shall (i) apply for or consent in writing to
the appointment of a receiver, trustee or liquidator of all or substantially all
of its assets, (ii) file a voluntary petition in bankruptcy or similar
proceeding or admit in writing its inability to pay its debts as they become
due, (iii) make a general assignment for the benefit

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of creditors, (iv) file a petition or an answer seeking reorganization or an
arrangement with its creditors or take advantage of any insolvency law with
respect to itself as debtor, or (v) file an answer admitting the material
allegations of a petition filed against it in any bankruptcy, reorganization,
insolvency proceedings or any similar proceedings.

          "Business Day" shall mean any day other than a Saturday, a Sunday or a
           ------------
day on which banks in the City of New York are authorized or obligated by law or
executive order to close.

          "Closing" shall mean the Closing under the Merger Agreement.
           -------

          "Environmental Law" means any applicable Law, including common law,
           -----------------
governing (i) the protection of human health (as it relates to Hazardous
Substances) or the environment (including air, water, soil and natural
resources), (ii) the treatment, use, storage, handling, release or disposal of
Hazardous Substances, or (iii) the exposure of Persons to Hazardous Substances,
in each case as presently in effect.

          "Governmental Entity" means any federal, state, local or foreign
           -------------------
governmental or regulatory authority, agency, commission, body or other
governmental entity.

          "Hazardous Substances" means any substance presently listed, defined,
           --------------------
designated or classified as hazardous, toxic or radioactive under any applicable
Environmental Law, or the presence of which poses hazard to the health or safety
of Persons, including petroleum and any derivatives or by-products thereof.

          "Law" means any statute, law, ordinance, rule, regulation, judgment,
           ---
decree, injunction, order, permit, filing, franchise, certificate, license,
notice, variance, consent, registration, approval, authorization or similar
right (whether temporary, preliminary or permanent) of any court or governmental
entity.

          "Person" means any individual, firm, partnership, association, group
           ------
(as such term is used in Rule 13d-5 under the Securities Exchange Act of 1934,
as amended, as such Rule is in effect on the date of this Agreement),
corporation or other entity.

          "Regulated Product" shall mean food, drugs, cosmetics, and medical
           -----------------
devices as those articles are defined in the Federal Food, Drug, and Cosmetic
Act (the "FFDCA"), and shall include Controlled Substances and List I Chemicals
          -----
as those articles are defined in the Controlled Substances Act (the "CSA").
                                                                     ---
                                   ARTICLE II

                                    PREMISES

          2.1.  Premises. Lessor hereby demises and lets unto Lessee, and Lessee
                --------
hereby takes and leases from Lessor, for the Initial Term (as defined in Section
3.1) and upon the terms and subject to the conditions hereinafter specified, the
premises described on the floor plan which is attached hereto as Exhibit A and
made a part hereof (the "Premises") situated at Lessor's Cranbury, NJ operations
                         --------
site as more particularly described on Exhibit B attached hereto and
made a part hereof (the "Property").
                         --------

          2.2.  Additional Premises. Lessor shall provide Lessee with reasonable
                -------------------
advance written notice of Lessor's intention to vacate any portion of the
Property. Upon such notice, Lessee shall have the exclusive right, subject to
the provisions of Section 2.3, to lease the portion of the Property

                                       -2-

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vacated by Lessor ("Vacated Space") on the same terms and conditions set forth
                    -------------
herein by providing Lessor with written notice, within fifteen (15) days of
receipt of Lessor's notice as set forth above, that Lessee agrees to lease the
Vacated Space. Any Vacated Space which Lessor elects, in a timely manner in
accordance with the provisions of this Section 2.2, to lease (the "Elected
                                                                   -------
Premises") shall be added as "Additional Premises" to the Premises immediately
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and automatically as of the date that Lessor vacates the Additional Premises
(the "Additional Premises Commencement Date") so long as adding the Elected
      -------------------------------------
Space to the Premises shall not prevent, or impair or disturb in any material
respect, use and operation of, ingress to or egress from, or the feasibility of
Lessor leasing to other Persons, any part of the Property other than the
Premises; provided, however, that if sum of the square footage of (i) any
Elected Space and (ii) any Additional Premises previously added to the Premises,
exceeds twenty percent (20%) of the total square footage of the Premises on the
date of this Agreement, the Elected Space shall not become Additional Premises
without Lessor's prior written consent, which consent shall not be unreasonably
withheld and which consent may be conditioned on an increase in rent
proportionate to the increase in square footage, increased expenses of operation
and other reasonable factors. If Lessee fails to provide notice to lease the
Vacated Space as required above, or if the limitations set forth above preclude
Lessee from leasing the Vacated Space even if Lessee has timely given a notice
to lease, Lessor shall have the right to lease the Vacated Space to any other
Person. Base Rent (as hereinafter defined) shall not increase or decrease due to
the addition of the Additional Premises to the Premises except in the case where
Lessor's consent is required as set forth above.

          2.3.  Lessee's Right to Vacate Certain Areas of the Premises. At any
                ------------------------------------------------------
time during the Term of this Agreement, upon 30 days' prior written notice to
Lessor, Lessee shall have the right to vacate: (i) the Wallace research and
development building (the "R&D Building") located on the Property, and (ii) a
                           ------------
majority of the employees on Lessee's payroll located in the office space in the
main building of the Property (the "Office Space"). If Lessee vacates the R&D
                                    ------------
Building or the Office Space as provided herein, Lessee shall not have the right
to lease any office or laboratory space as Additional Premises under Section
2.2. Upon Lessee vacating the R&D Building or the Office Space in broom clean
condition, removing all of its property and restoring such vacated space in
accordance with the provisions of this Agreement, the Premises shall no longer
include the vacated space, but Base Rent (as hereinafter defined) shall not
decrease due to vacating said space except in accordance with Section 4.1(b).

          2.4.  Condition of the Premises. Lessee accepts the Premises on the
                -------------------------
Commencement Date (as hereinafter defined) in its "as is" condition and Lessor
shall not be obligated to perform any work or furnish any materials in, to or
about the Premises in order to prepare the Premises for occupancy by Lessee or
otherwise. Lessor agrees to deliver the Additional Premises in vacant and broom
clean condition.

                                   ARTICLE III

                                      TERM

          3.1.  Initial Term. The initial term (the "Initial Term") of this
                ------------                         ------------
Agreement shall commence on the date hereof (the "Commencement Date") and shall
                                                  -----------------
expire on the date two (2) years from the last day of the month in which the
Commencement Date occurs (the "Expiration Date"), unless earlier terminated or
                               ---------------
extended as herein provided; provided, that in the event of a termination of
                             --------
this Agreement pursuant to the terms hereof prior to the Expiration Date, the
Expiration Date shall mean such date of termination of this Agreement.

                                       -3-

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          3.2.  Extension Options.
                -----------------

          (a)   If during the Initial Term, despite using commercially
reasonable efforts, Lessee has not been able to (i) produce 48 months of product
inventory of Soma, 48 months of product inventory of Soma Compound, or 30 months
of product inventory of Soma Compound with Codeine (collectively, the "Soma
                                                                       ----
Products"), 30 months of product inventory of Depen, 48 months of product
--------
inventory of Maltsupex tablets, 36 months of product inventory of Maltsupex
powder, 36 months of product inventory of Maltsupex liquid, 48 months of product
inventory of Miltown 200 and 48 months of product inventory of Miltown 400
(collectively, and together with the Soma Products, the "Pharmaceuticals") and
                                                         ---------------
(ii) receive any required United States Food and Drug Administration ("FDA") and
                                                                       ---
DEA (as hereinafter defined) approval to transfer the production of the Soma
Products to the Lessee's facility located in Decatur, Illinois, Lessee shall
have the right, upon ninety (90) days' prior written notice to Lessor, to extend
the term of this Agreement for an additional six (6) month term (the "Extended
                                                                      --------
Term"). Lessee hereby agrees to provide Lessor with periodic information
----
concerning Lessee's progress in obtaining such targeted inventory levels and FDA
and DEA approval of the transfer throughout the Initial Term.

          (b)   After the Initial Term and the Extended Term, if any, Lessee
shall have the right to extend the term of this Agreement for an additional one
(1) year term (the "Optional Extended Term") upon four (4) months' prior written
                    ----------------------
notice to Lessor. During the Optional Extended Term, Lessee shall not have any
right to terminate this Agreement under Section 8.11(c) hereinafter, nor shall
Lessee have the right to give a Notice of Exercise of the Option.

          3.3.  Term. The term of this Agreement (the "Term") shall be the
                ----                                   ----
aggregate period of the Initial Term and, if exercised, the Extended Term and
the Optional Extended Term, and any holdover periods under Section 8.4 hereof
(i) to which Lessor shall have given its consent or (ii) if Lessee has given a
valid Notice of Exercise of the Option under Article 7 and thereafter enters
into a Purchase Agreement to purchase the Property in accordance with Article 7.

                                   ARTICLE IV

                         BASE RENT AND ADDITIONAL COSTS

          4.1.  Base Rent.
                ---------

          (a)   During the Term of this Agreement, Lessee shall pay to Lessor
base rent ("Base Rent") which shall be (A) during months 1-12 of the Initial
Term, $125,000 monthly, payable in advance on the first day of each month;
provided, that if the Commencement Date is not the first day of a month, Lessee
shall pay in advance on the Commencement Date a sum equal to $4,166.66 per day
of the first month of the Initial Term (which sum represents the prorated
monthly installment based on a 30 day month), (B) during months 13-24 of the
Initial Term, $185,000 monthly, payable in advance on the first day of each
month, (C) during the Extended Term, $400,000 monthly, payable in advance on the
first day of each month, and (D) during the Optional Extended Term, $500,000
monthly, payable in advance on the first day of each month.

          (b)   At any time after the first twelve (12) months of the Initial
Term, if Lessee has vacated both the R&D Building and the Office Space as set
forth in, and otherwise satisfied the conditions set forth in, the last sentence
of Section 2.3, Base Rent per month shall be reduced by $25,000, but in no event
shall the Base Rent be reduced below $125,000 monthly.

          4.2.  Taxes and Assessments. Lessor shall pay all taxes, insurance on
                ---------------------
the Property, and water and sewer charges for the Premises.

                                       -4-

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          4.3.  Public Utilities. Subject to Section 8.5, Lessor shall pay all
                ----------------
charges for utilities used in the Premises, including but not limited to, heat,
air conditioning, water, gas and electricity.

          4.4.  Use. Subject to the terms hereof, Lessee may use the Premises
                ---
for the same purposes as the Property was used immediately prior to the
Commencement Date, including, but not limited to, general office administrative,
manufacturing and storage of Regulated Products and research and development
purposes during the Term hereof. Lessee shall provide Lessor with advance
written notice of any intended change in Lessee's use of the Premises.

          4.5.  Shared Areas. (a) At all times during the Term, Lessee and
                ------------
Lessee's designees shall have the right to use, on a nonexclusive basis and for
no additional cost or consideration, with Lessor and Lessor's designees, all of
the roadways, walkways, elevators, entrances, exits, hallways, and stairways
located on the Property, as may reasonably be required or desired for access to
the Premises, as well as the right to use the main reception area, the
conference rooms (subject to availability and in accordance with Lessor's normal
scheduling practices, except that Lessee shall have exclusive use of conference
rooms located within and adjacent to office space used for Wallace Laboratories
and Wampole Laboratories), the rest rooms, parking spaces (in an amount
necessary to accommodate Lessee's employees and a reasonable number of Lessee's
invitees), and the cafeteria, on the Property (such areas, together with the
respective corridors giving normal access to such areas, each being referred to
herein as a "Shared Area," and collectively as the "Shared Areas").

          (b)   Subject to, and without limiting Lessee's rights under, Section
4.4(a) above, the Shared Areas shall be subject to Lessor's sole management and
control, which shall be reasonable. Lessor reserves the right to change, from
time to time and on not less than 30 calendar days' prior written notice to
Lessee, the dimensions and location of the Premises (for which Lessee's consent
must be obtained, which consent may not be unreasonably withheld) as well as the
dimensions, location, identity and type of any building other than the Premises
and to construct additional buildings or additional stories on existing
buildings or other improvements on the Property so long as the same shall not
materially adversely affect Lessee's access to and use of the Premises. Lessor
may temporarily close any part of the Shared Areas for such periods of time as
may be reasonably necessary to make repairs or alterations, provided, that
                                                            --------
Lessor shall make reasonable efforts to mitigate any material disruption in
Lessee's use and enjoyment of the Premises, and Lessee shall at all times be
permitted adequate access to the Premises during such periods. Lessor further
reserves the right to permanently cease operating the cafeteria at any time.

          (c)   Subject to Section 4.6(d) below, the rights of Lessee to use the
Shared Areas shall extend through Lessee to Lessee's designated agents,
employees and invitees, such use to be in common with Lessor and other persons
permitted by Lessor to use the same, and subject to observance of such
reasonable and uniform rules and regulations governing use of the Shared Areas
and the Premises as Lessor may, from time to time, prescribe provided such rules
do not materially affect access to the Premises. Lessee and its designees shall
not take any action which shall interfere with the rights of other persons to
use the Shared Areas.

          (d)   Notwithstanding any other provision of this Agreement, Lessee's
allowance of access, and Lessor's access to any Shared Area, shall be in full
conformance with applicable law and regulation, including but not limited to
good manufacturing practice requirements under the FFDCA and physical security
and employee screening requirements under the CSA. The parties specifically
acknowledge that such legal and regulatory requirements may necessitate
restriction of Lessor's and Lessor's designees' access to the Shared Areas,
except under such terms and conditions as set by the FDA, the Drug Enforcement
Agency (the "DEA"), and state regulators administering parallel laws and
             ---
regulations. The parties specifically agree to use their best efforts to develop
and maintain such

                                       -5-

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information regarding designees' training, education, and background as will be
necessary in order to fulfill each Party's respective legal and regulatory
obligations.

          (e)   Subject to Section 4.5(d) above, any rules and regulations
adopted by Lessor with respect to the Shared Areas shall be uniformly applied
and enforced by Lessor as to all users of the Shared Areas, including without
limitation employees of Lessor and other tenants of the Premises, as the case
may be.
          (f)   The rights of Lessee with respect to the Shared Areas shall
terminate automatically upon termination of Lessee's rights to use the Premises.

          4.6.  Repairs and Maintenance. (a) Subject to Section 4.6(g), should
                -----------------------
it become necessary in Lessor's sole discretion during the Term hereof to repair
the structure of any buildings located on the Property (the "Buildings"),
                                                             ---------
including but not limited to, the roof, exterior walls, floor slab, windows,
exterior doors, HVAC (as defined hereinafter), plumbing or other building
systems, in order to give effect to Lessee's rights hereunder, including but not
limited to maintaining and ensuring future maintenance of the Property and the
environment within the Property in accordance with the FDA's current Good
Manufacturing Practices and applicable DEA regulations, or to maintain the
Shared Areas in substantially the same condition as on the date hereof, Lessor
shall make such repairs at its sole cost and expense, within a reasonable time
after notice to do so by Lessee, unless such repairs are required as the result
of the gross negligence or willful misconduct of Lessee or its agents, employees
or invitees, and, in such cases, such necessary repairs shall be made by Lessee
or by Lessor at Lessee's sole cost and expense.

          (b)   Subject to the performance by Lessor of its obligations under
Section 4.6(a), Lessee shall keep the Premises, including all improvements and
fixtures, in a good, clean and safe condition, in order to keep the same in
substantially the same condition as on the date hereof, at all times during the
Term of this Agreement, and shall perform such repairs as are required as the
result of the gross negligence or willful misconduct of Lessee or its agents,
employees or invitees, in each case at Lessee's sole cost and expense. Lessee
shall keep the equipment in good condition and repair at all times during the
Term of this Agreement.

          (c)   Lessee shall be responsible for the repair of all uninsured
damage caused by Lessee, and all maintenance required as a result of the gross
negligence or willful misconduct of Lessee, to the plumbing, electrical and
other fixtures located within the Premises.

          (d)   Lessee shall comply in all material respects with all laws,
ordinances, orders and regulations of governmental authorities relating to
Lessee's manner of use of the Premises and the actual conduct of Lessee's
business.

          (e)   Lessee shall promptly notify the Lessor in writing of any damage
to or defects in the Premises, and of any injuries to persons or property which
occur therein, of which Lessee had actual notice.

          (f)   Lessee shall not take or fail to take any action which, as a
direct result, increases the amount of Lessor's insurance premiums in relation
to the Premises and will comply with all reasonable recommendations of Lessor's
insurer with respect to any precautions concerning life and safety and against
fire. Lessee hereby agrees to reimburse Lessor for any increase in Lessor's
insurance premiums which directly result from Lessee's actions or inactions.

                                       -6-

<PAGE>

          (g)   In the event that during the Term hereof any alteration,
addition, repair, maintenance or other change to the Premises, or any portion
thereof, is required to be made in connection with the enactment, amendment or
repeal of any statute, ordinance, rule or regulation, including under FDA, DEA
rules and regulations, or the rendering of any judicial or administrative
decision increasing building standards above the standards existing on the date
hereof, then and in that event:

               (i)   if such repair, maintenance, alteration, addition or change
     is required primarily by reason of the manner or mode or character of
     Lessee's use of the Premises, Lessee shall have the right to terminate this
     Agreement by giving notice to Lessor, in which case this Agreement shall
     terminate as of the date that is 90 calendar days after the date such
     notice is given, and if Lessee does not elect to terminate this Agreement,
     then Lessee shall make such alteration, addition or change at Lessee's sole
     cost and expense and in compliance with the terms of this Agreement;

               (ii)  subject to Section 4.7(c), if said repair, maintenance,
     alteration, addition or change is required for any other reason, including,
     but not limited to, a structural defect in or other condition relating to
     the Premises which was in existence as of the date hereof, then said
     alteration, addition or change shall be made at Lessor's sole cost and
     expense and within a commercially reasonable amount of time.

          (h)   Lessor, its agents and representatives, may enter upon the
Premises at any reasonable time and upon reasonable notice and without
unreasonably interfering with Lessee's business, emergencies excepted, for the
purpose of inspecting the same, or as otherwise required by any applicable law,
rule or regulation or by Lessor in respect of security matters or for the
Buildings' safety and protection.

          (i)   Notwithstanding the foregoing provisions, if Lessee has actual
knowledge of any condition requiring any immediate, urgent repair to the
Premises or requiring the performance of any other urgent action, and any delay
in the performance thereof may result in material loss or damage to the
Premises, Lessee shall have the right, at its option, to make such repairs or
perform such act promptly without obtaining Lessor's prior approval if otherwise
required hereunder. Any condition which shuts down any or all of Lessee's
production on the Premises shall de facto be a condition requiring urgent
repair. Lessee shall as soon as practicable thereafter notify Lessor of the
facts and shall be entitled to be reimbursed promptly for all its reasonable
costs incurred in connection therewith, provided, it is not otherwise Lessee's
                                        --------
responsibility under this Agreement to make said corrections.

          (j)   Lessor shall have the right to contest or review by legal
proceedings or in any such other manner as Lessor deems suitable, any laws,
ordinances and regulations requiring that Lessor perform a repair, provided that
such right to contest shall not unreasonably disturb Lessee's use and operation
of the Premises. Lessee shall cooperate with Lessor, execute such documents and
perform such acts as may be reasonably required to effectively prosecute such
contest or review, all at Lessor's sole cost and expense.

          4.7.  Alterations and Improvements.
                ----------------------------

          (a)   Lessee shall not make any alterations or improvements (each an
"Alteration," collectively, "Alterations") which affect the structural
 ----------                  -----------
components, core components or building systems components of the Premises
without first obtaining Lessor's approval, which may not be unreasonably
withheld, delayed or conditioned. Lessee may make any other commercially
reasonable Alterations to the Premises without Lessor's consent. All such
permanent Alterations and improvements shall remain the property of Lessor, but
Lessee shall have the right, but not the obligation, at Lessee's sole cost and

                                       -7-

<PAGE>

expense, to remove any and all Alterations which can reasonably be disassembled
and removed from the Premises upon the expiration or sooner termination of this
Agreement. Lessee shall repair any damage to the Property caused by such removal
within a reasonable amount of time.

          (b)  All Alterations to be carried out by Lessee shall be performed:

                (i)   in a good and workmanlike manner and free from defects;

                (ii)  in accordance with detailed plans and specifications
     reasonably agreed upon by Lessor and Lessee, if such Alterations affect the
     structural components, core components or building system components of the
     Premises;

                (iii) by contractors reasonably agreed upon by Lessor and
     Lessee, if such Alterations affect the structural components, core
     components or building system components of the Premises consistent with
     applicable labor practices;

                (iv)  in compliance with all laws and requirements of any
     applicable federal, state, county, city and political subdivisions of the
     country in which the Premises is located and any board, bureau, council,
     commission, department, agency, court, legislative body or other
     instrumentality relating thereto; and

                (v)   in such a manner so as to minimize any inconvenience or
     disturbance to the use, occupancy and business of Lessor.

          (c)   If Lessee makes any Alterations, Lessee shall be responsible for
any necessary asbestos removal or remediation and any repairs reasonably
required as a result thereof.

          4.8.  Signs. Lessee may, with the prior written consent of Lessor,
                -----
which consent shall not be unreasonably withheld, erect, place or maintain such
sign or signs on the Premises as are usual to the type of operation conducted by
Lessee or required by applicable law or regulation.

          4.9.  Mechanic's Liens. (a) If a "mechanic's lien" or other statutory
                ----------------
lien is filed against the Property arising from any work, labor or material
furnished to Lessee in connection with any improvements made by Lessee upon the
Property, Lessee shall, subject to the following clauses (b)-(e), promptly pay
and discharge the same.

          (b)   If Lessee fails to pay and discharge the same for a period of 30
calendar days after such lien shall have been filed against the Property, Lessor
may notify Lessee of its intention to pay all or a portion thereof. Lessee may
then, within 10 calendar days after receipt of such notice, notify Lessor that
it believes it has a valid defense to any such asserted claim or lien, that it
desires to contest the same, and shall promptly deliver to Lessor a good and
sufficient bond duly executed by a surety authorized to write such bonds and
which is reasonably satisfactory to Lessor, indemnifying Lessor and any
mortgagee against any loss arising therefrom.

          (c)   If Lessee so notifies Lessor and delivers the bond described
above, Lessee shall thereupon diligently proceed to have the validity of said
lien determined by proper proceedings, legal or otherwise, and Lessor shall not
make any payment on account of any such lien until the validity thereof has been
determined by final adjudication or action, unless it be necessary that such
payment be made to prevent a sale or forfeiture of the Property or to redeem the
same from any sale or forfeiture.

                                       -8-

<PAGE>

          (d)   If Lessee does not so notify Lessor, Lessor may, at its option,
pay all or any portion of the amount of said lien, and pay any sum necessary to
prevent a judgment or execution, or sale or forfeiture of the Property, or
redeem the same from any sale or forfeiture made on account thereof. The amounts
so paid, together with all expenses and reasonable attorney's fees incurred,
shall be repaid to Lessor by Lessee at the next rent paying date after such
payment, together with interest thereon at the rate of 10% per annum from the
date of payment by Lessor until repaid.

          (e)   A copy of any notice, writ, process or demand served upon either
Lessor or Lessee with respect to said "mechanic's lien", or other statutory
lien, shall promptly be forwarded to the other Party.

                                    ARTICLE V

             LIMITATION ON LIABILITY, INSURANCE AND INDEMNIFICATION

          5.1.  Limitation on Liability; Indemnification.
                ----------------------------------------

          (a)   Neither Party nor any of its Affiliates will be liable to the
other Party and its Affiliates for any claim or demand against the other Party
and its Affiliates, and their respective officers, directors, partners,
principals, employees, agents or representative, arising under or relating to
this Agreement (i) by any unaffiliated third party, or (ii) for any amounts
representing loss of profit, loss of use of any space, loss of the value of
occupancy pursuant to a leasehold, loss of business or business interruptions or
special, indirect, incidental, consequential, or punitive damages of any nature
whatsoever, including, without limitation, any damages arising out of or in
connection with any loss of business or anticipatory profits, even if either has
been advised of the possibility of such damages.

          (b)   Subject to Section 5.1(a), Lessee (for purposes of Section
5.1(d), an "Indemnifying Party") shall indemnify, defend and hold harmless
Lessor and its Affiliates, and their respective officers, directors, partners,
principals, employees, agents, representatives, successors and permitted assigns
(collectively, the "Lessor Indemnified Parties," and for purposes of Section
5.1(d), each an "Indemnified Party"), from and against all liabilities,
out-of-pocket costs and expenses, including, without limitation, reasonable
defense costs, settlement costs and attorneys' fees (collectively, "Losses")
based upon any (i) Losses which are directly and proximately caused by the gross
negligence or willful misconduct of Lessee or its Affiliates or (ii) Lessee's
failure to comply in any material respect with the express terms of this
Agreement. The indemnification obligations set forth in this Section 5.1(b) are
subject to the indemnification procedures set forth in Section 5.1(d).

          (c)   Subject to Section 5.1(a), Lessor shall indemnify, defend and
hold harmless Lessee and its Affiliates, and their respective officers,
directors, partners, principals, employees, agents, representatives, successors
and permitted assigns (collectively, the "Lessee Indemnified Parties"), and for
purposes of Section 5.1(d), each an "Indemnified Party") from and against any
Losses based upon any (i) claim by an unaffiliated third party arising out of or
related to an Additional Service provided by Lessor or its Affiliates pursuant
to this Agreement to the extent, and only to the extent, that such Losses are
directly or proximately caused by the gross negligence or willful misconduct of
Lessor or its Affiliates or (ii) the Lessor's failure to comply in any material
respect with the express terms of this Agreement. The indemnification
obligations set forth in this Section 5.1(c) are subject to the indemnification
procedures set forth in Section 5.1(d).

          (d)   Any claim which may form a basis for indemnification hereunder
(an "Indemnity Claim") by any Party (an "Indemnified Party") shall be asserted
     ---------------                     -----------------
and resolved as set forth in this Section 5.1(d). The Indemnified Party shall
promptly, but in no event more than 15 Business Days

                                       -9-

<PAGE>

following such Indemnified Party's receipt of, notice of, or actual knowledge of
such claim, give written notice to the Party that may be required to pay an
indemnity hereunder in respect of such Indemnity Claim (an "Indemnifying Party")
                                                            ------------------
which notice shall state in reasonable detail the nature and basis of the
Indemnity Claim and the amount or the estimated amount thereof to the extent
then feasible (which estimate shall not be conclusive of the final amount of any
claim) and which notice, if applicable, shall also have attached to it copies of
all relevant documents received by the Indemnified Party substantiating such
Indemnity Claim (the "Claim Notice"). Failure of the Indemnified Party to give a
                      ------------
Claim Notice as contemplated hereby shall not relieve the Indemnifying Party
from liability for indemnification hereunder, except if and to the extent that
the Indemnifying Party is actually prejudiced thereby. Thereafter, the
Indemnified Party shall deliver to the Indemnifying Party, on an ongoing basis
promptly after the Indemnified Party's receipt thereof, copies of all notices
and documents received by the Indemnified Party relating to the Indemnity Claim,
as the case may be. With respect to an indemnity claim other than a third party
claim that is resolved as provided in this Section 5.1(d), the Indemnifying
Party shall promptly pay such Indemnity Claim within 20 Business days from its
receipt of the Claim Notice (the "Notice Period"), unless it notifies the
                                  -------------
Indemnified Party in writing that the Indemnifying Party disputes the liability
of the Indemnifying Party to the Indemnified Party hereunder with respect to the
Indemnity Claim. If the Indemnity Claim involves an amount in dispute with a
third party (a "Third Party Claim"), the Indemnifying Party may advise the
                -----------------
Indemnified Party within 10 Business Days from its receipt of the Claim Notice
that it will defend the Indemnified Party against such Third Party Claim. Except
as hereinafter provided, in the event that the Indemnifying Party so notifies
the Indemnified Party that it will defend the Indemnified Party against such
Third Party Claim, the Indemnifying Party shall have the right to defend the
Indemnified Party by appropriate proceedings and shall have the sole power to
direct and control such defense. All costs and expenses incurred by the
Indemnifying Party in defending the Third Party Claim shall be paid by the
Indemnifying Party. If an Indemnified Party desires to participate in any such
defense it may do so at its sole cost and expense; provided, that the
                                                   --------
Indemnified Party and its counsel shall comply with all reasonable instructions
from the Indemnifying Party. The Indemnifying Party shall not consent to the
entry of any judgment or enter into any settlement in respect of a Third Party
Claim without the consent of the Indemnified Party, to the extent such judgment
or settlement imposes a non-monetary obligation on the Indemnified Party or is
not accompanied by a complete and unconditional release of the Indemnified Party
in respect of such Third Party Claim; provided, that the consent of the
Indemnified Party shall not be unreasonably withheld, conditioned or delayed. If
the Indemnifying Party elects not to defend the Indemnified Party against such
Third Party Claim, whether by not giving the Indemnified Party timely notice as
provided above or otherwise, then the Indemnified Party may conduct the defense
and the reasonable costs and expenses pertaining to such defense shall be the
liability of the Indemnifying Party hereunder. In any case, whether or not the
Indemnifying Party elects to control the defense of a Third Party Claim, the
Indemnified Party shall not consent to the entry of any judgment or enter into
any settlement in respect of a Third Party Claim without the consent of the
Indemnifying Party, and without such consent the Indemnifying Party shall not be
obligated to indemnify the Indemnified Party hereunder in respect of the related
Indemnification Claim; provided, that the consent of the Indemnifying Party
shall not be unreasonably withheld, conditioned or delayed. To the extent the
Indemnifying Party shall direct, control or participate in the defense or
settlement of any Third Party Claim, the Indemnified Party will, as reasonably
required, give the Indemnifying Party and its counsel access to, during normal
business hours, the relevant business records and other documents, and permit
them to consult with the employees and counsel of the Indemnified Party.
Regardless of which Person assumes control of the defense of any claim, each
Party shall cooperate and provide the other Party reasonable assistance in the
defense thereof.

          (e)   Each Indemnified Party shall be entitled to recover under the
indemnification provisions of this Section 5.1 only the Losses incurred by it
which exceed the amount of the net proceeds available to it under its insurance
coverage. Thereafter, when an Indemnifying Party has agreed under this Agreement
to indemnify the Indemnified Party only to the extent of the gross negligence or
willful

                                       -10-

<PAGE>

misconduct of the Indemnifying Party or its Affiliates, the obligation of such
Indemnifying Party to indemnify nevertheless also shall include the negligence
of the Indemnifying Party or its Affiliates to the extent that the Indemnifying
Party or its Affiliates maintain insurance coverage for such negligence (after
any deductible).

          (f)   The remedies set forth in this Agreement shall constitute the
sole and exclusive remedy and shall be in lieu of any other remedies that may be
available to any Lessor Indemnified Parties or Lessee Indemnified Parties under
any agreement, pursuant to any statutory or common law, in equity or otherwise
with respect to the subject matter of this Agreement. The Parties each hereby
waive any provision of any applicable law to the extent that it would limit or
restrict the agreements contained in this Section 5.1(f).

          5.2.  Insurance. At all times during the Term, Lessee shall, at its
                ---------
sole cost and expense, maintain insurance in amounts not less than:

          (a)   Insurance for property damage (including damage to Lessee's
equipment and personal property) at the actual cash value of covered Property;
and

          (b)   Liability insurance for bodily injury and property damage of $5
million combined single limit per occurrence and in the aggregate.

A copy of each insurance policy or certificate thereof shall be issued by an
insurer reasonably satisfactory to Lessor and authorized to issue such policy or
policies, shall name Lessor and the mortgagee of Lessor, if any, as additional
insured parties and shall otherwise be reasonably satisfactory to Lessor, and
shall be delivered to the Lessor by commencement of the Term and shall not be
subject to cancellation upon less than 10 calendar days written notice to Lessor
and any such mortgagee. Such insurance, by its terms or by endorsement, shall
waive any right of subrogation of the insurer against Lessor, any mortgagee, and
their agents and employees, for any loss or damage covered.

          5.3.  Fire and Extended Coverage Insurance. At all times during the
                ------------------------------------
Term the Lessor shall, at its sole cost and expense (except as provided in
Section 4.6(f)), maintain fire and extended coverage insurance upon the
Premises. Such insurance shall be in an amount at least equal to the actual cash
value of the improvements on the Premises (excluding damage to Lessee's
equipment and personal property) and shall be written by an insurance company or
association authorized to issue such policies under the laws of the State of New
Jersey and reasonably satisfactory to Lessee. A copy of each insurance policy or
certificate thereof shall be delivered to the Lessee by commencement of the
Term, and shall not be subject to cancellation upon less than 10 calendar days
written notice to Lessee. Such insurance, by its terms or by endorsement, shall
waive any right of subrogation of the insurer against Lessee, its agents and
employees, for any loss or damage resulting from fire or extended coverage
perils.

                                   ARTICLE VI

                   REGULATIONS; PHARMACEUTICAL OPERATIONS AND
                            ENVIRONMENTAL PROVISIONS

          6.1.  Governmental Regulations. (a) Lessee shall, at its sole cost and
                ------------------------
expense, comply with all applicable laws, ordinances and regulations and
insurance requirements in its use of the Premises.

          (b)   Lessee shall, at its sole cost and expense, obtain and hold any
and all registrations, approvals, and licenses required by the FDA, the DEA, and
parallel state authorities with

                                       -11-

<PAGE>

jurisdiction over Regulated Products and their components, handling and
distribution. Alterations to the Premises necessary to achieve and/or maintain
compliance with applicable regulation and any regulatory change regarding the
manufacturing, distribution, and holding of Regulated Products shall be at
Lessee's sole cost and expense in accordance with Sections 4.7 and 4.8.

          (c)   Lessee shall, however, have the right to contest or review by
legal proceedings or in any such other manner as Lessee deems suitable, any such
laws, ordinances and regulations, provided such right to contest shall not
unreasonably disturb Lessor's use and operation of the Property. Such
proceedings may be commenced in the name of the Lessor (with Lessor's consent,
which may not be unreasonably withheld), Lessee, or both. Lessor shall cooperate
with Lessee, execute such documents and perform such acts as may be reasonably
required to effectively prosecute such contest or review, all at Lessee's sole
cost and expense.

          (d)   Subject to Section 4.6(g), Lessor agrees to maintain the
Property in compliance in all material respects with all relevant laws,
ordinances, and regulation including but not limited to the FDA's current Good
Manufacturing Practice regulations and applicable DEA regulations, in each case
to the extent applicable thereto. Lessor shall, however, have the right to
contest or review by legal proceedings or in any such other manner as Lessor
deems suitable, any such laws, ordinances and regulations, provided such right
to contest shall not unreasonably disturb Lessee's use and operation of the
Premises. Such proceedings may be commenced in the name of the Lessee (with
Lessee's consent, which may not be unreasonably withheld), Lessor, or both.
Lessee shall cooperate with Lessor, execute such documents and perform such acts
as may be reasonably required to effectively prosecute such contest or review,
all at Lessor's sole cost and expense.

          6.2.  Environmental Provisions.
                ------------------------

          (a)   Lessee shall defend, indemnify, protect and hold the Lessor's
Indemnified Parties harmless against all demands, claims, actions, assessments,
losses, damages, liabilities, costs and expenses of every nature, including
reasonable attorney's fees, relating to the Premises, Shared Areas or other
portion of the Property and resulting from or arising out of any environmental
conditions, events or circumstances caused by Lessee, Lessee's agents,
employees, representatives, invitees, subcontractors, customers or Affiliates
during Lessee's use and occupancy of the Premises and Shared Areas or other
portion of the Property during the Term, including but not limited to the
presence, release or threat of release to the environment of any Hazardous
Substances.

          (b)   Lessee shall store and handle Hazardous Substances at the
Premises and Shared Areas, in strict compliance with applicable Environmental
Laws and shall indemnify, defend and save harmless the Lessor's Indemnified
Parties from all fines, suits, procedures, claims, actions, damages, and
liability of any kind (including reasonable attorney's fees) arising out of or
in any way connected with the storage or handling by Lessee of Hazardous
Substances at the Premises and the Shared Areas during the Term.

          (c)   Lessor shall store and handle any Hazardous Substances or wastes
which Lessor stores or handles within the Premises and Shared Areas (if so
permitted by the Lessee) in compliance in all material respects with
Environmental Laws, and shall indemnify, defend and save harmless Lessee from
all fines, suits, procedures, claims, actions, damages, and liability of any
kind (including attorney's fees) arising out of or in any way connected with or
related to the storage or handling by Lessor of Hazardous Substances within the
Premises and Shared Areas during the Term.

          (d)   The obligations and liabilities of Lessee and Lessor under this
Section 6.2 shall survive the Term.

                                       -12-

<PAGE>

          (e)   During the Term of this Agreement and at the expiration of the
Agreement, Lessee shall at its sole cost and expense be responsible for the
reasonable clean-up and removal of all raw materials, packaging, solid waste,
unused and used lubricants, oils, solvents and any hazardous wastes placed,
abandoned or located on the Premises and the area surrounding the Premises by
Lessee (or any of Lessee's representatives, customers, Affiliates, employees,
agents, invitees or subcontractors) during the Term of this Agreement (as well
as during any holdover periods).

                                   ARTICLE VII

                                 PURCHASE OPTION

          7.1.  Grant of Option. Lessor hereby grants to Lessee an option (the
                ---------------
"Option") to acquire from Lessor, at the price and upon and subject to the terms
 ------
and conditions set forth herein, the following:

          (a)   fee simple interest in the Property;

          (b)   Lessor's interest in all space leases and any security deposits,
lease guarantees, and other rights relating thereto and in any agreements
relating to leasing of parking space or roof space;

          (c)   Lessor's interest or rights in any insurance proceeds or
condemnation proceeds as they relate to the Property, to the extent such
proceeds are payable after the execution of the Purchase Agreement (as
hereinafter defined) and the Lessor has not applied funds, to be reimbursed from
the proceeds, to repair or rebuild the Property; and

          (d)   to the extent permitted to be assigned or conveyed and owned by
Lessor, all service contracts, if any, and other agreements relating to the
ownership, leasing or occupancy of the Property.

          7.2.  Purchase Price. The purchase price (the "Purchase Price") for
                --------------                           --------------
the Property shall be the greater of (i) $20,000,000 (reduced by the amount of
the net after deduction of all fees and expenses including legal and brokerage,
transfer taxes, amounts to satisfy encumbrances and other transaction costs
proceeds, if any, derived by Lessor from any prior sale by Lessor of any portion
of the Property) or (ii) the fair market value of the property (the "Fair Market
                                                                     -----------
Value") as determined pursuant to Section 7.3, in each case plus all other
-----
amounts due and payable by Lessee hereunder that have not been paid. The
Purchase Price shall be payable at the Option Closing (as hereinafter defined),
in cash by federal funds transferred to a bank account of Lessor or its designee
as designated in writing to Lessee at least 5 days before the Option Closing.

          7.3.  Fair Market Value. The Fair Market Value shall be determined
                -----------------
taking into account the highest and best use of the Property and assuming that
the Property is free and clear of all liens and encumbrances (including this
Lease) other than Permitted Exceptions (as defined hereinafter) as follows:

          (a)   The Notice of Exercise delivered by Lessee to Lessor pursuant to
Section 7.4 shall set forth Lessee's determination of Fair Market Value
("Lessee's Determination").
  ----------------------

          (b)   Lessor shall have the right to give Lessee written notice
("Lessor's Notice"), within thirty (30) days after Lessor's receipt of the
  ---------------
Notice of Exercise, of whether Lessor accepts or disputes Lessee's
Determination. If Lessor in Lessor's Notice accepts Lessee's Determination or if
Lessor fails or refuses to give Lessor's Notice as aforesaid, Lessor shall be
deemed to have accepted Lessee's

                                       -13-

<PAGE>

Determination with respect to the Fair Market Value. If Lessor in Lessor's
Notice disputes Lessee's Determination, Lessor shall deliver to Lessee, together
with Lessor's Notice, Lessor's determination of the Fair Market Value ("Lessor's
                                                                        --------
Determination") as determined by an independent real estate appraiser ("Lessor's
-------------                                                           --------
Appraiser").
---------

          (c)   Lessee shall have the right to give Lessor written notice
("Lessee's Notice"), within thirty (30) days after Lessee's receipt of Lessor's
  ---------------
Notice, of whether Lessee accepts or disputes Lessor's Determination. If Lessee
in Lessee's Notice accepts Lessor's Determination or if Lessee fails or refuses
to give Lessee's Notice as aforesaid, Lessee shall be deemed to have accepted
Lessor's Determination. If Lessee in Lessee's Notice disputes Lessor's
Determination, Lessee shall appoint an independent real estate appraiser
("Lessee's Appraiser"). If within thirty (30) days after Lessor's receipt of
  ------------------
Lessee's Notice in dispute, Lessee's Appraiser and Lessor's Appraiser shall
mutually agree upon the determination (the "Mutual Determination") of the Fair
                                            --------------------
Market Value, their determination shall be final and binding upon the parties.
If Lessee's Appraiser and Lessor's Appraiser shall be unable to reach a Mutual
Determination within said thirty (30) day period, both of the Appraisers shall
jointly select a third independent real estate appraiser who has not been in the
employ of Lessee or Lessor or their respective Affiliates during the preceding
three (3) years ("Third Appraiser"), whose fee shall be borne equally by Lessee
                  ---------------
and Lessor. In the event that Lessee's Appraiser and Lessor's Appraiser shall be
unable to jointly agree on the designation of the Third Appraiser within five
(5) Business Days after they are requested to do so by either party, then the
parties agree to allow the American Arbitration Association (or any successor
organization; "AAA") to designate the Third Appraiser in accordance with the
               ---
rules, regulations and/or procedures then obtaining of the AAA.

          (d)   The Third Appraiser shall conduct such hearings and
investigations as he may deem appropriate and shall, within thirty (30) days
after the date of designation of the Third Appraiser, choose either Lessee's or
Lessor's Determination, and such choice by the Third Appraiser shall be
conclusive and binding upon Lessee and Lessor. Each party shall pay its own
counsel fees and expenses if any, in connection with any arbitration under this
Section, including the expenses and fees of any Appraiser selected by it in
accordance with provisions of this Article. Any Appraiser appointed pursuant to
this Section 7 shall be an independent real estate appraiser with at least ten
(10) years experience in leasing and valuation of properties which are similar
in character to the Property, and a member of the American Institute of
Appraisers of the National Association of Real Estate Boards and a member of the
Society of Real Estate Appraisers. Prior to his appointment, the Third Appraiser
shall agree to be bound by the provisions hereof, including the obligation to
render a determination within thirty (30) days after the date of his
designation. The Appraisers shall not have the power to add to, modify or change
any of the provisions of this Lease.

          7.4.  Exercise of the Option. (a) No later than the one hundred and
                ----------------------
eightieth day following the last day of the Initial Term, Lessee shall have the
right, upon not less than six months prior written notice to Lessor, to exercise
the Option by serving upon Lessor written notice (the "Notice of Exercise") of
                                                       ------------------
its election to exercise the Option; provided, however, that if Lessee validly
delivers a Notice of Exercise, Lessee thereafter shall execute a purchase
agreement (the "Purchase Agreement"), in accordance with the terms set forth in
                ------------------
this Section 7, by the date which is the later of (i) the sixtieth day following
the date of the Notice of Exercise and (ii) the fifteenth day following the date
of the final determination of Fair Market Value. The failure of Lessee to enter
into the Purchase Agreement within such time period shall render the Notice of
Exercise void and this Article 7 of no further force and effect.

          7.5.  Option Closing Date. The date (the "Option Closing Date") for
                -------------------                 -------------------
the conveyance of the Property by Lessor to Lessee (the "Option Closing") shall
                                                         --------------
be as set forth in the Purchase Agreement, but no later than the sixtieth day
following the date the Optional Extended Term would have expired had the
Optional Extended Term been exercised. If Closing has not occurred by such date,
the

                                       -14-

<PAGE>

Option, including any exercise thereof, shall be of no further force or effect,
unless the Closing has not occurred due to the default by either party in which
case the other party shall retain the right to pursue any or all of its remedies
hereunder.

          7.6.  Failure to Perform. If either Party fails or refuses to timely
                ------------------
perform its obligations hereunder, then the other Party shall be entitled a suit
for specific performance. In the case of such default, the Option Closing Date
may be extended in the sole and absolute discretion of the non-defaulting Party
for such period of time as deemed in the sole and absolute discretion of the
non-defaulting Party to be necessary to take such actions, in no event later
than three (3) months following the original Option Closing Date (the "Extended
                                                                       --------
Option Closing Date"). If, in such event, the Term would otherwise expire, the
-------------------
Term will be automatically extended to the earlier of the actual Option Closing
or the Extended Option Closing Date on the same terms and conditions which
existed immediately prior to the original Option Closing Date. In the event that
the Option Closing does not occur by the Extended Option Closing Date, then
notwithstanding anything to the contrary in this Agreement, the non-defaulting
Party may in addition to all rights and remedies at law or in equity, upon
notice to the defaulting Party, terminate this Agreement and any rights or
obligations pursuant to the Option and this Section.

          7.7.  Property to be Conveyed "As-Is."
                ------------------------------

          (a)   Lessee hereby acknowledges and agrees that the Lessee has
examined the Property, is familiar with the physical condition thereof, and that
the Property shall be conveyed in its "as is" condition; provided, that Lessor
                                                         --------
shall remove any mortgages or other liens it has incurred or created against the
Property. Except those representations, warranties and other statements made in
this Agreement, neither Lessor nor Lessor's agents have heretofore made or do
hereby make, and Lessee expressly acknowledges and agrees that Lessee is not
relying upon, any representations, warranties or other statements (either
express or implied) as to the physical condition of the Property, environmental
matters, the expenses, operation, maintenance, rents, leases or zoning of the
Property, the use to which the Property may be put, or any other matter or thing
affecting or relating to the Property.

          (b)   Upon the execution of the Purchase Agreement, Lessor shall no
longer have the obligation to make structural repairs pursuant to Section
4.6(a).

          7.8.  Deliveries. At the Option Closing, Lessor shall execute and
                ----------
deliver to Lessee or its designee:

          (a)   a good and sufficient deed (of the type under which Lessor
acquired title but at least comparable to a bargain and sale deed without
covenants against grantor's acts under New York law) to convey to Lessee or its
designee title to the Property, subject only to those liens and encumbrances (i)
permitted by Section 7.7 or (ii) to which Lessee does not reasonably object as
impairing use of the property as it is being used on the date of this Agreement,
real property taxes and assessments not yet due and payable, zoning ordinances
and other governmental laws and regulations (collectively, "Permitted
                                                            ---------
Exceptions");
----------

          (b)   a bill of sale and assignment agreement, in form and substance
reasonably acceptable to Lessee, duly executed and acknowledged by Lessor, with
respect to all of Lessor's right, title and interest in, to and under the other
assets, if any, including, without limitation, the operating equipment, the
contracts, documents, intangible property and any leases with respect to the
Building, and including an assumption by Lessee of such contracts, leases and
other obligations;

          (c)   certified copies of all applicable limited liability company
resolutions, certificates of incumbency and other organizational documents with
respect to the Lessor;

                                       -15-

<PAGE>

          (d)   a fully executed owner's affidavit, in a form reasonably
acceptable to any national, reputable title company designated by Lessee, (the
"Title Company");
 -------------

          (e)   originals or copies of all licenses and permits relating to the
Property, if any; and

          (f)   at the Option Closing, Lessor and Lessee or its designee, as
applicable, shall take such actions and execute and deliver all such other
documents, certificates, affidavits, and other instruments or agreements which
may be necessary or appropriate in order to consummate the transactions
contemplated by this Section.

          Any Closing with respect to the purchase of the Property under this
Article 7 shall be subject to the receipt of all consents, orders, approvals and
authorizations of any governmental or regulatory entities, including the FDA and
the DEA, or any lender applicable to such purchase, which conditions may not be
waived without the consent of all parties to such transactions and which
consents, orders, approvals and authorizations each Party will use reasonable
efforts to obtain.

          7.9.  Title Policies. The Title Company shall be prepared, subject
                --------------
only to payment of the customary applicable premium and endorsement fees and
delivery of all conveyance documents in recordable form, to issue a title
insurance policy to Lessee or its designee, at Lessee's expense, in form and
substance reasonably satisfactory to Lessee in accordance with the terms of
Section 7.7 and 7.8 of this Agreement, together with such affirmative coverages
as Lessee may reasonably require at Lessee's expense.

          7.10.  Time is of the Essence. Time is of the essence with respect to
                 ----------------------
all obligations pursuant to this Section 7.

                                  ARTICLE VIII

                            MISCELLANEOUS PROVISIONS

          8.1.  Destruction of the Premises. Should the Premises or any Shared
                ---------------------------
Areas which are reasonably necessary for access to or use of the Premises be
destroyed or damaged in whole or in part at any time during the Term by fire,
earthquake, act of God, or acts of the public enemy, or by any other casualty,
the rights and duties of the Parties with respect to reconstruction, rebuilding
or repair thereof, and with respect to the continuance or termination of this
Agreement, shall be as follows (except when such fire or other casualty resulted
from the gross negligence or willful misconduct of Lessee or Lessee's agent,
designee or invitee):

          (a)   If the cost of reconstructing, rebuilding or repairing is less
than 20% of the total value of all improvements on the Premises, excluding
personal property and improvements made by Lessee, Lessor shall reconstruct,
rebuild or repair the Premises, exclusive of improvements made by Lessee, with
no unreasonable delay, at Lessor's sole cost and expense, to the extent
reasonably feasible using the insurance proceeds available. During the period of
such reconstruction, rebuilding or repairing, the Base Rent herein provided to
be paid by Lessee shall be reduced on a pro rata basis in the same proportion
that the area of the Premises not able to be occupied by Lessee during such
period bears to the area of Premises prior to such casualty.

          (b)   If the cost of reconstructing, rebuilding or repairing is 20% or
more of the total value of all improvements on the Premises, excluding personal
property and improvements made by Lessee, Lessee may terminate this Agreement at
any time within 30 calendar days from the date of such casualty upon notice to
Lessor. If the cost of reconstructing, rebuilding or repairing is 50% or more of
the

                                       -16-

<PAGE>

total value of all improvements, excluding personal property and improvements
made by Lessee, Lessor or Lessee may terminate this Agreement at any time within
30 calendar days from the date of such casualty upon notice to the other. In the
event this Agreement is not so terminated, Lessor shall reconstruct, rebuild or
repair said Premises, exclusive of improvements made by Lessee, without
unreasonable delay, at Lessor's sole cost and expense, to the extent reasonably
feasible using the insurance proceeds available. During such period of
reconstruction, rebuilding or repairing the Base Rent shall be prorated in the
manner provided in subparagraph (a) above.

          (c)   Notwithstanding the foregoing provisions of subparagraph (a),
if, in Lessee's reasonable opinion, the damages caused by any such casualty
cannot be repaired within 90 calendar days after the date of such casualty and
in addition, such damages make the use of said Premises by Lessee impracticable,
Lessee shall have the right, at its option, to cancel this Agreement upon notice
to Lessor within 20 calendar days from and after the date of such casualty.

          (d)   Any such termination shall be deemed effective as of the date of
the casualty and each of the Parties hereto shall be relieved of all further
obligations hereunder not accrued before said date, except such obligations as,
by their terms, must be performed or completed after such termination.

          8.2.  Quiet Enjoyment. If, and so long as, Lessee pays all rent due
                ---------------
hereunder and performs Lessee's other obligations hereunder, Lessee shall
peaceably and quietly hold and use the Premises during the Term hereof without
any disturbance by Lessor, and Lessor shall, at its own expense, defend Lessee's
right to peaceably and quietly hold and use the Premises during the Term hereof
against all persons claiming the same.

          8.3.  Condemnation. If an area of the Premises or Shared Areas
                ------------
allowing access to Premises occupied by Lessee hereunder shall be taken or
condemned by any competent authority for any public or quasi-public use or
purpose Lessee has the right to terminate this Agreement on the date when said
area is so taken. Lessor shall reimburse Lessee for any prepaid Base Rent on a
daily pro rata basis as contemplated by Section 8.1(a). Lessor shall have the
right to assert a claim against the condemning body or authorities for any
damage to the Buildings resulting from any such condemnation proceedings and
shall be solely entitled to proceeds in respect thereof. Lessee shall have the
right to assert a claim against the condemning body or authorities for any
damage resulting from any such condemnation proceedings to improvements made by
it in the Premises, and for business interruption and relocation costs, and
Lessor shall not share in any award derived by such claim, provided that any
claim by Lessee for business interruption shall not reduce the amount of
Lessor's award from such taking.

          8.4.  Holding Over. In the event Lessee shall hold over possession of
                ------------
the Premises upon the expiration of the Term herein set forth, such holding over
shall be construed to be a use and occupancy from month to month upon the same
terms, covenants and conditions as set forth above, except that the Base Rent
shall increase by 100% from the rate in effect immediately prior to such
occupancy, payable until the date that Lessee has vacated the Premises in broom
clean condition and removed all of its property and restored such vacated space
in accordance with the provisions of this Agreement, and any such holdover
occupancy may be terminated at any time with 30 calendar days notice from Lessor
or Lessee.

          8.5.  Lessor Services. (a) During the term of this Agreement, Lessor
                ---------------
shall operate and maintain the Property with standards applicable to facilities
conducting similar businesses in the Cranbury, New Jersey area, including, but
not limited to the FDA's current Good Manufacturing Practice regulations and
other FDA and DEA requirements for the manufacturing of human pharmaceuticals
and shall furnish and distribute to the Premises heating, ventilating and air
conditioning ("HVAC") and all other utilities as may be reasonably required
               ----
twenty-four hours a day, seven days a week, excluding the

                                       -17-

<PAGE>

following holidays: New Year's Day, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day and Christmas Day; provided, that Lessee shall reimburse Lessor
for the additional costs associated with providing utilities to the Premises in
excess of the extent to which utilities are provided to the Premises prior to
this Agreement.

          (b)   During the term of this Agreement, Lessor shall cause the
Premises to be cleaned substantially in accordance with the cleaning
specifications from time to time established by Lessor for the Buildings. Lessor
and its cleaning contractor, if any, and their employees shall have access to
the Premises, and the use of Lessee's light, power and water without charge
therefor, at all times.

          (c)   During the term of this Agreement, Lessor shall supply an
adequate amount of hot, tepid and cold water to the Buildings' standard
lavatories, washrooms, wash closets, sinks and cooking facilities for normal
office use.

          (d)   During the term of this Agreement, Lessor shall provide to
Lessee, consistent with past practice, the services specified on Exhibit C
hereto, and Lessor shall provide such other incidental services as the Parties
may from time to time agree upon (collectively, the "Additional Services").
                                                     -------------------

          (e)   Lessor reserves the right to stop, interrupt or reduce service
of the HVAC systems, elevators, electrical or plumbing or any other service or
systems because of events beyond the reasonable control of Lessor or for repairs
or improvements which, in the reasonable judgment of Lessor, are deemed
necessary or desirable (the "Service Interruptions"). Lessor hereby agrees to
                             ---------------------
use commercially reasonable efforts to cure any Service Interruptions. The
Service Interruptions may continue only for a reasonable period of time and
under no circumstances shall the Service Interruptions exceed five (5) days in
any thirty (30) day period. The Base Rent shall be abated after five (5)
continuous days of Service Interruptions on a per diem basis in the proportion
that the rentable area of the Premises so affected by the Service Interruptions
bears to the rentable area of the entire Premises.

          8.6.  Confidentiality.
                ---------------

          (a)   The Parties hereto expressly acknowledge and agree that all
information, whether written or oral, furnished by either Party to the other
Party or any Affiliate of such other Party pursuant to this Agreement, including
any schedules and exhibits hereto ("Confidential Information") shall be deemed
                                    ------------------------
to be confidential and shall be maintained by each Party and their respective
Affiliates in confidence, using the same degree of care to preserve the
confidentiality of such Confidential Information that the Party to whom such
Confidential Information is disclosed would use to preserve the confidentiality
of its own information of a similar nature and in no event less than a
reasonable degree of care. Except as authorized in writing by the other Party,
neither Party shall at any time disclose or permit to be disclosed any such
Confidential Information to any person, firm, corporation or entity, (i) except
as may reasonably be required in connection with the performance of this
Agreement by Buyer, the Company or their respective Affiliates, as the case may
be, and (ii) except to the Parties' agents or representatives who are informed
by the Parties of the confidential nature of the information and are bound to
maintain its confidentiality , and (iii) in the course of due diligence in
connection with the sale of all or a portion of either Party's business,
provided the disclosure is pursuant to a written nondisclosure agreement having
terms comparable to Sections 8.6(a) and 8.6(b).

          (b)   The obligation not to disclose information under Section 8.6(a)
shall not apply to information that, as of the Closing or thereafter, (i) is or
becomes generally available to the public other than as a result of disclosure
made after the execution of the Asset Purchase Agreement by the Party desiring
to treat such information as nonconfidential or any of its Affiliates or
representatives thereof,

                                       -18-

<PAGE>

(ii) was or becomes readily available to the Party desiring to treat such
information as nonconfidential or any of its Affiliates or representatives
thereof on a nonconfidential basis prior to its disclosure to such Party by the
other Party, or (iii) becomes available to the Party desiring to treat such
information as nonconfidential or any of its Affiliates or representatives
thereof on a nonconfidential basis from a source other than its own files or
personnel or the other Party or its Subsidiaries, provided, that such source is
                                                  --------
not known by the Party desiring to treat such information as nonconfidential to
be bound by confidentiality agreements with the other party or its Affiliates or
by legal, fiduciary constraints on disclosure of such information, or (iv) is
required to be disclosed pursuant to a governmental order or decree or other
legal requirement (including the requirements of the U.S. Securities and
Exchange Commission and the listing rules of any applicable securities
exchange), provided, that the Party required to disclosure such information
           --------
shall give the other Party prompt notice thereof prior to such disclosure and,
at the request of the other Party, shall cooperate in all reasonable respects in
maintaining the confidentiality of such information, including obtaining a
protective order or other similar order. Nothing in this Section 8.6(b) shall
limit in any respect either Party's ability to disclose information in
connection with the enforcement by such Party of its rights under this
Agreement.

          (c)   Neither Lessee nor any officer, director, shareholder, agent or
employee of Lessee shall communicate in any manner with, nor shall in any manner
provide information to, any prospective buyer, lessee, lender or broker of the
Property or any other persons (other than a person acting on behalf of Lessee)
concerning the Property, without the prior written consent (including by
electronic mail) in each instance from Lessor.

          8.7.  Independent Contractor. This Agreement shall not constitute or
                ----------------------
give rise to a partnership between the Parties. All Additional Services provided
by Lessor under the terms of this Agreement shall be carried on by Lessor as an
independent contractor and not as an agent for or employee of Lessee and this
Agreement shall not constitute or give rise to an agency relationship between
the Parties except as otherwise expressly contemplated hereby. Lessee shall not
be liable for any injuries or personal or Property damages incurred by Lessor or
its agents or employees in the performance of their duties hereunder, as the
case may be, unless caused by the gross negligence or willful misconduct of
Lessee. No employee of Lessor shall be deemed to be an employee of Lessee.

          8.8.  Invitees' Compliance. Lessee and Lessee's invitees shall
                --------------------
faithfully observe and comply with, and shall not permit a violation of, any
rules and regulations Lessor shall reasonably adopt with respect to the
Buildings.

          8.9.  Early Termination by either Lessee or Lessor. Lessor and Lessee
                --------------------------------------------
may terminate this Agreement as mutually agreed by the Parties.

          8.10. Early Termination by Lessor. Lessor may terminate this Agreement
                ---------------------------
by and effective upon its delivery of written notice to Lessee specifying the
basis for termination hereunder, under the following circumstances:

          (a)   if Lessee shall breach this Agreement in any material respect;
provided that Lessee shall have the right, exercisable twice during the term
hereof, to prevent termination based upon Lessee's breach hereof by curing such
breach within 30 calendar days following receipt of Lessor's termination notice,
or, if such breach is of such a nature that for reasons beyond Lessee's control
it cannot be completely remedied within said period of 30 calendar days, then if
Lessee (i) shall not promptly institute and thereafter diligently prosecute to
completion all steps necessary to remedy the same and (ii) shall not remedy the
same within a reasonable time after the date of default; or

          (b)   following the occurrence of a Bankruptcy Event with respect to
Lessee.

                                       -19-

<PAGE>

          8.11.  Early Termination by Lessee. Except as otherwise specifically
                 ---------------------------
provided in this Agreement, Lessee may terminate this Agreement by and effective
upon its delivery of written notice to Lessor specifying the basis for
termination hereunder, under following circumstances:

          (a)    if Lessor shall breach this Agreement in any material respect;
provided that Lessor shall have the right, exercisable twice during the term
hereof, to prevent termination based upon Lessor's breach hereof by curing such
breach within 30 calendar days following receipt of Lessee's termination notice,
or, if such breach is of such a nature that for reasons beyond Lessor's control
it cannot be completely remedied within said period of 30 calendar days, then if
Lessor (i) shall not promptly institute and thereafter diligently prosecute to
completion all steps necessary to remedy the same and (ii) shall not remedy the
same within a reasonable time after the date of default; or

          (b)    if a Bankruptcy Event has occurred with respect to Lessor; or

          (c)    Lessee may terminate this Agreement by and effective upon its
delivery of ninety (90) calendar days' written notice to the other Party.

          8.12.  Lessee Reasonable Best Efforts to Relocate Operations. From and
                 -----------------------------------------------------
after the date hereof, Lessee shall use its reasonable best efforts, including
without limitation, obtaining any required consents from the FDA, DEA and any
other applicable regulatory authorities, to effect, as soon as practicable after
Closing, the transfer of all of its equipment and all manufacturing operations
located on the Premises to premises that are not part of Lessor's business
operations. Lessor agrees to use commercially reasonable efforts, at Lessee's
direction, to assist Lessee in connection therewith. All costs and expenses
incurred pursuant to this Section 8.12 shall be paid by Lessee. Lessee shall
keep Lessor apprized in a timely manner of its progress in, and the status of,
the approval process with the applicable regulatory authorities, and shall
consult in good faith with Lessor as to how to obtain such approvals and to
manage the approval process with such authorities. Once all such approvals have
been obtained and transfer has occurred, Lessee and Lessor shall as promptly as
commercially reasonable, terminate this Agreement under Section 8.10.

          8.13.  Subordination. This Agreement and Lessee's rights hereunder are
                 -------------
subject and subordinate to (i) all present and future ground agreements, and
similar agreements (collectively, the "Superior Agreement"), (ii) all present
                                       ------------------
and future mortgages and building loan agreements, which may now or hereafter
affect all or any portion of the land, the Buildings or the Superior Agreement
and each advance made under the superior mortgage, and (iii) all renewals,
modifications, spreaders, consolidations, replacements, substitutions and
extensions of the Superior Agreement and the superior mortgage. The provisions
of this Section shall be self-operative and no further instrument of
subordination shall be required. Lessee shall promptly execute and deliver, at
its expense, any instrument, in recordable form if requested, that Lessor may
reasonably request to evidence and confirm such subordination. Notwithstanding
the foregoing, for so long as (i) Lessee shall not be in default hereunder and
(ii) this Agreement shall not have been terminated, no such subordination shall
be effective unless the mortgagee or ground lessee or holder of the Superior
Agreement, as the case may be, shall execute with Lessee a non-disturbance and
attornment agreement in form reasonably acceptable to Lessee and the other Party
or parties thereto, which acceptance shall not be unreasonably withheld.

          8.14.  Suspension due to Force Majeure. In the event the performance
                 -------------------------------
by either Lessee or Lessor of their respective duties or obligations hereunder
is interrupted or interfered with by reason of any cause beyond its reasonable
control including, but not limited to, fire, storm, flood, earthquake,
explosion, war, strike or labor disruption, rebellion, insurrection, quarantine,
"act of God", boycott, embargo, shortage or unavailability of supplies,
employees or services, riot, or governmental law, regulation or edict
(collectively, a "Force Majeure Event"), the Party affected by such Force
                  -------------------
Majeure

                                       -20-

<PAGE>

Event shall not be deemed to be in default of this Agreement by reason of its
nonperformance of its obligations hereunder to the extent due to such Force
Majeure Event, but shall give prompt written notice to the other Party of the
Force Majeure Event. If, as soon as, and to the extent that the Force Majeure
Event no longer interrupts a Party's performance of its obligations hereunder,
its interrupted obligations shall accrue from such point forward under the terms
hereof.

          8.15.  Consequences on Termination. In the event this Agreement
                 ---------------------------
expires or is terminated, then (a) each of Lessor and Lessee shall promptly
return all Confidential Information received from the other Party in connection
with this Agreement (including the return of all information received with
respect to products of Lessor or Lessee, as the case may be), without retaining
a copy thereof, (b) each of Lessor and Lessee shall honor all credits and make
any accrued and unpaid payment to the other Party as required pursuant to the
terms of this Agreement, and (c) each Party shall continue to be subject to its
accrued but unperformed obligations and any liabilities in respect of its prior
breach hereof.

          8.16.  Return of Equipment. At any time during the Term of this
                 -------------------
Agreement and for one month thereafter, Lessee and its designated contractors
shall have the right (which Lessee may exercise at any time and from time to
time during such period) to enter upon the Premises and Shared Areas and remove
any equipment or any components on the Premises, provided, however, that such
                                                 -----------------
removal shall not unreasonably interfere with the use of the Property. Equipment
not removed within such time shall be and become the property of Lessor without
further act or charge. Lessor shall cooperate with Lessee and shall provide, at
Lessee's reasonable request and at Lessee's sole cost and expense, employees to
assist Lessee in disassembling and crating any such equipment prior to its
removal. Lessor's obligation to provide employees to assist in disassembling and
crating equipment shall be contingent upon the Lessor having employees available
for such duties without adversely impacting the Lessor's other operations;
provided that to the extent Lessee has requested of the Lessor that equipment be
--------
removed and it is not removed due to the Lessor not providing sufficient
employees to assist in the removal, the date referenced in the first sentence of
this Section shall be extended to the extent required to permit removal of the
equipment with the necessary assistance of the Lessor's employees. Lessee shall
repair any damage to the Property caused by the removal of such equipment within
a reasonable amount of time.

          8.17.  Modification or Amendment. Subject to the provisions of
                 -------------------------
applicable law, the Parties hereto may only modify or amend this Agreement by
written agreement executed and delivered by duly authorized officers of Lessee
and Lessor.

          8.18.  Counterparts. This Agreement may be executed in any number of
                 ------------
counterparts, each such counterpart being deemed to be an original instrument,
and all such counterparts shall together constitute the same agreement.

          8.19.  GOVERNING LAW AND VENUE; WAIVER OF JURY TRIAL. (a) THIS
                 ---------------------------------------------
AGREEMENT AND ANY DISPUTES, CLAIMS OR CONTROVERSIES ARISING FROM OR RELATING TO
THIS AGREEMENT SHALL BE DEEMED TO BE MADE IN AND IN ALL RESPECTS SHALL BE
INTERPRETED, CONSTRUED AND GOVERNED BY AND IN ACCORDANCE WITH THE LAW OF THE
STATE OF NEW JERSEY WITHOUT REGARD TO THE CONFLICT OF LAW PRINCIPLES THEREOF.
The Parties hereby irrevocably submit to the jurisdiction of the courts of the
State of New Jersey and the Federal courts of the United States of America
located in the County of Middlesex, New Jersey solely in respect of the
interpretation and enforcement of the provisions of this Agreement and of the
documents referred to in this Agreement, and in respect of the transactions
contemplated hereby, and hereby waive, and agree not to assert, as a defense in
any action, suit or proceeding for the interpretation or enforcement hereof or
of any such document, that it is not subject thereto or that such action, suit
or proceeding by certified mail may not be brought or

                                       -21-

<PAGE>

is not maintainable in said courts or that the venue thereof may not be
appropriate or that this Agreement or any such document may not be enforced in
or by such courts, and the Parties irrevocably agree that all claims with
respect to such action or proceeding shall be heard and determined in such a New
Jersey State or Federal court. The Parties hereby consent to and grant any such
court jurisdiction over the person of such Parties and over the subject matter
of such dispute and agree that mailing of process or other papers in connection
with any such action or proceeding in the manner provided in Section 8.20 or in
such other manner as may be permitted by law shall be valid and sufficient
service thereof.

          (b)    EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH
MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT
ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT,
OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH PARTY CERTIFIES AND
ACKNOWLEDGES THAT (i) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY
HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (ii) EACH PARTY
UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (iii) EACH PARTY
MAKES THIS WAIVER VOLUNTARILY, AND (iv) EACH PARTY HAS BEEN INDUCED TO ENTER
INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION 8.19.

          8.20.  Notices. Any notice, request, instruction or other document to
                 -------
be given hereunder by any party to the others shall be in writing and shall be
deemed to have been delivered (i) on the date of service, if served personally,
(ii) upon confirmation of receipt, if transmitted by facsimile, electronic or
digital transmission method, (iii) on the first business day after sent, if sent
for next day delivery by recognized overnight delivery service and (iv) on the
third day after it is sent, if sent by first class mail. In each case, notice
shall have been sent to the Parties at the following addresses:

          if to Buyer
          -----------

          Armkel, LLC
          c/o Kelso & Company
          320 Park Avenue, 24/th/ Floor
          New York, NY 10022
          Attention: James J. Connors, II, Esq.
          Telecopy: (212) 223-2379

          (with copies to:

          Ronald Beard, Esq.
          Gibson, Dunn & Crutcher LLP
          4 Park Plaza
          Irvine, California 92614
          Telephone:  949-451-4089
          Facsimile:  949-475-4730

                                       -22-

<PAGE>

          Steven P. Buffone, Esq.
          Barbara L. Becker, Esq.
          Gibson, Dunn & Crutcher LLP
          200 Park Avenue
          New York, New York 10166
          Telephone:  212-351-4000
          Facsimile:  212-351-4035

          and

          Lou Kling, Esq.
          Eileen T. Nugent, Esq.
          Skadden, Arps, Slate, Meagher & Flom LLP
          Four Times Square
          New York, New York 10036
          Telephone: 212-735-2770
          Facsimile: 917-777-2770)

          if to the Company
          -----------------

          MedPoint Inc.
          51 JFK Parkway
          1/st/ Floor West
          Short Hills, NJ 07078
          Attention:  Anthony H. Wild
          fax:  (973) 218-2704

          (with a copy to:

          William E. Curbow, Esq.
          Simpson Thacher & Bartlett
          425 Lexington Avenue
          New York, New York 10017
          Telephone:  212-455-3160
          Facsimile:  212-455-2502)

or to such other persons or addresses as may be designated in writing by the
Party to receive such notice as provided above.

          8.21.  Entire Agreement. This Agreement, the Asset Purchase Agreement
                 ----------------
and the other Ancillary Agreements (as defined in the Asset Purchase Agreement)
including any schedules and exhibits hereto or thereto, constitute the entire
agreement with respect to the subject matter hereof, and supersedes all other
prior agreements, understandings, representations and warranties both written
and oral, among the Parties.

          8.22.  Severability. It is the intention of the Parties that the
                 ------------
provisions of this Agreement shall be deemed severable and the invalidity or
unenforceability of any provision shall not affect the validity or
enforceability of the other provisions hereof. It is the intention of the
Parties that if any provision of this Agreement, or the application thereof to
any Person or any circumstance, is invalid or unenforceable, (a) a suitable and
equitable provision shall be substituted therefor in order to carry out, so far
as may be valid and enforceable, the intent and purpose of such invalid or
unenforceable provision

                                       -23-

<PAGE>

and (b) the remainder of this Agreement and the application of such provision to
other Persons or circumstances shall not be affected by such invalidity or
unenforceability, nor shall such invalidity or unenforceability affect the
validity or enforceability of such provision, or the application thereof, in any
other jurisdiction.

          8.23.  Assignment.
                 ----------

          (a)    Subject to Section 8.23(b) below, this Agreement and any rights
and obligations hereunder shall not be assignable by any Party whether by
operation of law or otherwise, without the prior written consent of the other
Party, which consent may not be unreasonably withheld, and any assignment made
in contravention of this Section shall be null and void; provided, that any
                                                         --------
Party may assign any rights and obligations hereunder, in whole or in part, to
an Affiliate of the Party without the consent of the other Party; provided
                                                                  --------
further, that if a Party's Affiliate is performing any obligations on behalf of
-------
such Party, such Party shall continue to be directly and primarily liable
hereunder for the performance thereof. Notwithstanding the foregoing, the
transfer or issuance of any interests in either Party, whether in a single
transaction or a series of related or unrelated transactions, in such quantities
that such issuance shall change the identity of the person or group which shall
have Control (as hereinafter defined) of such Party, shall not be deemed an
assignment for which the consent of the other Party is required, provided, in
the case of a change of Control of Lessee, that such change of Control will not
affect the FDA and DEA approval schedule for the transfer of the Pharmaceuticals
provided for in Section 3.2. Lessor's consent shall not be required for the sale
of all or substantially all of Lessee's assets provided such sale will not
affect the FDA and DEA approval schedule for the transfer of the Pharmaceuticals
provided for in Section 3.2. Control shall mean possession of the power,
directly or indirectly, to direct or cause the direction of management and
policy of a business entity, whether through the ownership of voting interests,
the contractual right to manage the affairs of such business entity or
otherwise.

          (b)    Notwithstanding the foregoing, Lessor shall have the right to
transfer or to encumber all or any part of the Property in accordance with the
provisions set forth below. Lessor shall have the right to transfer any
unimproved portion of the Property free and clear of this Agreement and the
Option, and thereafter, the Option shall apply only to the remainder of the
Property without any reduction of the Purchase Price except as provided in
clause (i) of Section 7.2. Any transfer by Lessor of all of the Property or of
any improved portion thereof shall be subject to this Agreement, including the
Option, unless, at any time after the Initial Term, the following shall occur:
(i) Lessor shall give Lessee not less than thirty (30) days prior written notice
of such transfer and (ii) either (x) Lessee shall fail within such thirty day
period to deliver a Notice of Exercise or (y) if Lessee does deliver a Notice of
Exercise within such thirty day period, Lessee shall fail to enter into the
Purchase Agreement as provided in Article 7. If the conditions set forth in (i)
and (ii) above shall be satisfied, Lessor thereafter shall have the right to
sell the Property or any portion thereof subject to this Agreement but free and
clear of the Option and thereafter Article 7 of this Agreement shall be of no
further force and effect with respect to the Property or any portion thereof.
From and after any transfer by Lessor of its interest in the Property, Lessee's
recourse hereunder shall be limited solely to such successor Lessor, and the
former Lessor, from and after the date on which it shall have transferred its
interest hereunder, shall have no further liability hereunder, provided that the
transferee agrees to be bound by this Agreement.

          8.24.  Default. Notwithstanding Sections 8.10 and 8.11, if Lessor or
                 -------
Lessee shall default under the terms of this Agreement, each Party shall have
the right to sue for the other Party for damages or pursue any and all other
remedies available at law or equity.

          8.25.  No Third-party Beneficiary Rights. This Agreement is not
                 ---------------------------------
intended to confer upon any Person other than the Parties any rights or remedies
hereunder or in connection herewith.

                                       -24-

<PAGE>

          8.26.  Headings/Construction. Section headings contained in this
                 ---------------------
Agreement are for convenient reference only, and shall not in any way affect the
meaning or interpretation of this Agreement. The language used in this Agreement
will be deemed the language chosen by the Parties to express their mutual
intent, and no rule of strict construction will be applied against any Person.

                                       -25-

<PAGE>

     IN WITNESS WHEREOF, the Parties hereby have caused this Agreement to be
executed by their proper officers, duly authorized to do so, as of the date
first written above.

                                     Carter-Wallace, Inc.

                                     By:_______________________________________
                                         Name:
                                         Title:

                                     Armkel, LLC

                                     By:_______________________________________
                                         Name:
                                         Title:

<PAGE>

                                                                       EXHIBIT A

                                    PREMISES

<PAGE>

                                                                       EXHIBIT B

                                    PROPERTY

<PAGE>

                                                                       EXHIBIT C

                               ADDITIONAL SERVICES

          Lessor shall provide Lessee with the Additional Services set forth
below in the same manner as such services were provided on the Premises prior to
the Commencement Date of this Agreement.

1.   Janitorial and Porter Services: Lessor shall provide Lessee with all
     ------------------------------
reasonably necessary janitorial services, including but not limited to trash
removal, mopping, dusting, vacuuming and other general cleaning services.
2.   Security Services: Lessor shall provide Lessee with building and perimeter
     -----------------
security services consistent with the schedule and quality of such services
provided prior to the Commencement Date.
3.   Rubbish Services: Lessor shall provide Lessee with general and production
     ----------------
waste rubbish services except for specialized manifested and hazardous waste
unless such waste removal were provided on the date of this Agreement.
4.   Buildings and Ground Maintenance: Lessor shall provide Lessee with
     --------------------------------
maintenance services necessary to maintain the Premises in a clean and safe
manner at all times.
5.   Insurance Expenses: Lessor shall maintain all insurance policies necessary
     ------------------
for the Property at Lessor's sole cost and expense; except as otherwise
provided in the terms of the Agreement.
6.   Uniform Expenses: Lessor shall provide uniforms and laboratory attire to
     ----------------
the extent required for all employees at the Property. Lessor shall also
provide for all reasonable cleaning services in connection with maintaining the
uniforms.
7.   Property Management/Administration: Lessor shall provide all employees
     ----------------------------------
reasonably necessary to operate the Premises.
8.   Food Service: Subject to any collective bargaining agreements which cover
     ------------
certain Lessor employees, Lessor shall maintain and operate the cafeteria or
other food service.
10.  Permits and Fees: Lessor shall obtain, at its sole cost and expense, any
     ----------------
and all permits and fees reasonably necessary to operate the Premises;
provided, however if Lessor must obtain a permit or pay a fee solely for the
benefit of Lessee, Lessee shall reimburse Lessor for such costs.
11.  Taxes: Lessor shall be solely responsible for paying all taxes associated
     -----
with maintaining the Property, including but not limited to real estate taxes.
12.  Safety Equipment: Lessor shall provide all safety equipment and services
     ----------------
reasonably necessary to maintain and operate the Premises in a safe manner.
13.  Miscellaneous Services: Lessor shall provide all additional services
     ----------------------
reasonably necessary to maintain and operate the Premises, including but not
limited to scale services, fire extinguishers, exterminating services,
elevators, process equipment and repairs, outside laboratory services(provided,
that any additional or modified DEA and FDA services not already provided on the
date of this Agreement shall be paid for by Lessee), boiler testing, fork lift
truck repairs and other miscellaneous maintenance supplies.<PAGE>

                                                                    Exhibit 10.6

                            INDEMNIFICATION AGREEMENT

     INDEMNIFICATION AGREEMENT, dated as of September 28, 2001 (this
"Agreement"), between Carter-Wallace, Inc., a Delaware corporation (the
 ---------
"Company"), and Armkel, LLC, a Delaware limited liability company ("Buyer")
 -------                                                            -----
(each, a "Party" and, collectively, the "Parties").
          -----                          -------

                                    RECITALS:

     WHEREAS, the Company and Buyer have executed and delivered an Asset
Purchase Agreement, dated as of May 7, 2001 (including the exhibits, schedules
and annexes thereto, the "Asset Purchase Agreement"), providing for, among other
                          ------------------------
things, the sale, conveyance, transfer, assignment and delivery to Buyer of all
of the Company's and its Affiliates' rights, title and interest in and to the
Purchased Assets (as defined in the Asset Purchase Agreement) and the assumption
by Buyer of all of the Assumed Liabilities (as defined in the Asset Purchase
Agreement), effective in each case immediately prior to the ABC Merger (as
defined herein);

     WHEREAS, the Company, CPI Development Corporation, a Delaware corporation
("ABC"), MedPointe Inc., a Delaware corporation ("Parent"), MCC Merger Sub
  ---                                             ------
Corporation, a Delaware corporation and a wholly owned subsidiary of Parent
("Company Merger Sub"), and MCC Acquisition Sub Corporation, a Delaware
  ------------------
corporation and a wholly owned subsidiary of Parent ("ABC Merger Sub"), have
                                                      --------------
executed and delivered an Agreement and Plan of Merger, dated as of May 7, 2001
(including the exhibits, schedules and annexes thereto, the "Merger Agreement"),
                                                             ----------------
providing for, among other things, the merger of ABC Merger Sub with and into
ABC (the "ABC Merger") and the merger of Company Merger Sub with and into the
          ----------
Company; and

     WHEREAS, in connection with the transactions contemplated by the Asset
Purchase Agreement and the Merger Agreement, Buyer and the Company desire to
provide certain indemnification rights to each other as contemplated by this
Agreement.

     NOW, THEREFORE, the Parties, in consideration of the premises and the
mutual covenants contained herein, hereby agree as follows:

                                   ARTICLE I

                                   Definitions

     1.1 General Terms. For purposes of this Agreement, capitalized terms used
         -------------
but not defined in this Agreement have the respective
meanings set forth in the Asset Purchase Agreement.

                                   ARTICLE II

                                 Indemnification

     2.1 Buyer Indemnification. From and after the Company Merger Effective
         ---------------------
Time, Buyer shall indemnify and hold the Company and each Subsidiary and
Affiliate of the Company and their respective directors, officers, employees,
agents, representatives, and their respective successors and permitted assigns
(collectively, the "Company Indemnified Parties") harmless from any and all
                    ---------------------------
liabilities, obligations, damages, losses, charges, interest, deficiencies,
civil, criminal or administrative actions, suits, claims, hearings,
investigations, arbitrations, proceedings, demands, judgments, fines, penalties
or

<PAGE>

settlements of any nature or kind, whether incurred prior to, at or after the
Closing, including all costs and expenses, whether incurred on, prior to or
following the date of the Closing ("Liabilities") to the extent (i) arising out
of or relating to any Transaction Claim, or (ii) such Liabilities constitute
Assumed Liabilities; provided that with respect to indemnification due under
                     --------
Clause (i) above, Buyer shall only be obligated to indemnify the Company
Indemnified Parties for (A) out-of-pocket payments and costs required or agreed
to be made (and made) by a Company Indemnified Party to a third party in respect
of any Transaction Claims and (B) 60 percent of such Liabilities arising in
respect of any Transaction Claim. "Transaction Claim" means any suit, action or
                                   -----------------
proceeding by or before any Governmental Entity challenging the validity or
legality of the transactions contemplated by the Merger Agreement or Asset
Purchase Agreement (other than any such action relating to competition,
antitrust or similar matters) or in respect of claims by shareholders of the
Company or ABC exercising dissenters' rights ("Appraisal Claims") under
                                               ----------------
applicable Law with respect to such contemplated transactions. For purposes of
calculating the Liabilities associated with the Transaction Claims, all
Liabilities of the Company and the Buyer (including legal fees) will be
aggregated and the Company will indemnify the Buyer Indemnified Parties (as
defined below) for all Liabilities arising out of or relating to Transaction
Claims on the same basis as Buyer above indemnifies the Company Indemnified
Parties, except that the percentage shall be 40 and not 60.

     2.2 Company Indemnification. From and after the Closing, the Company shall
         -----------------------
indemnify and hold Buyer, and each Subsidiary and Affiliate of Buyer and their
respective directors, officers, employees, agents, representatives, and their
respective successors and permitted assigns (collectively, the "Buyer
                                                                -----
Indemnified Parties") harmless from any Liabilities to the extent such
-------------------
Liabilities constitute Excluded Liabilities.

     2.3 Procedures for Indemnity Claims. Any claim (other than those arising
         -------------------------------
out of a Transaction Claim, which are addressed in (S) 2.4) which may form a
basis for indemnification hereunder (an "Indemnity Claim") by any Party (an
                                         ---------------
"Indemnified Party") shall be asserted and resolved as set forth in this Section
 -----------------
2.3. The Indemnified Party shall promptly, but in no event more than 15 Business
Days following such Indemnified Party's receipt of, notice of, or actual
knowledge of such claim, give written notice to the Party that may be required
to pay an indemnity hereunder in respect of such Indemnity Claim (an
"Indemnifying Party") which notice shall state in reasonable detail the nature
 ------------------
and basis of the Indemnity Claim and the amount or the estimated amount thereof
to the extent then feasible (which estimate shall not be conclusive of the final
amount of any claim) and which notice, if applicable, shall also have attached
to it copies of all relevant documents received by the Indemnified Party
substantiating such Indemnity Claim (the "Claim Notice"). Failure of the
                                          ------------
Indemnified Party to give a Claim Notice as contemplated hereby shall not
relieve the Indemnifying Party from liability for indemnification hereunder,
except if and to the extent that the Indemnifying Party is actually prejudiced
thereby. Thereafter, the Indemnified Party shall deliver to the Indemnifying
Party, on an ongoing basis promptly after the Indemnified Party's receipt
thereof, copies of all notices and documents received by the Indemnified Party
relating to the Indemnity Claim, as the case may be. With respect to an
Indemnity Claim other than a Third Party Claim (as defined below) that is
resolved as provided in this Section 2.3, the Indemnifying Party shall promptly
pay such Indemnity Claim within 20 Business days from its receipt of the Claim
Notice (the "Notice Period"), unless it notifies the Indemnified Party in
             -------------
writing that the Indemnifying Party disputes the liability of the Indemnifying
Party to the Indemnified Party hereunder with respect to the Indemnity Claim. If
the Indemnity Claim involves an amount in dispute with a third party (a "Third
                                                                         -----
Party Claim"), the Indemnifying Party may advise the Indemnified Party within 20
-----------
Business Days from its receipt of the Claim Notice that it will defend the
Indemnified Party against such Third Party Claim. Except as hereinafter
provided, in the event that the Indemnifying Party so notifies the Indemnified
Party that it will defend the Indemnified Party against such Third Party Claim,
the Indemnifying Party shall have the right to defend the Indemnified Party by
appropriate proceedings and shall have the sole power to direct and control such
defense. All costs and expenses incurred by the

                                       2

<PAGE>

Indemnifying Party in defending the Third Party Claim shall be paid by the
Indemnifying Party. If an Indemnified Party desires to participate in any such
defense it may do so at its sole cost and expense; provided, that the
                                                   --------
Indemnified Party and its counsel shall comply with all reasonable instructions
from the Indemnifying Party. The Indemnifying Party shall not consent to the
entry of any judgment or enter into any settlement in respect of a Third Party
Claim without the prior written consent of the Indemnified Party, to the extent
such judgment or settlement imposes a non-monetary obligation on the Indemnified
Party or is not accompanied by a complete and unconditional release of the
Indemnified Party in respect of such Third Party Claim; provided, that the
                                                        --------
consent of the Indemnified Party shall not be unreasonably withheld, conditioned
or delayed. If the Indemnifying Party elects not to defend the Indemnified Party
against such Third Party Claim, whether by not giving the Indemnified Party
timely notice as provided above or otherwise, then the Indemnified Party may
conduct the defense and the reasonable costs and expenses pertaining to such
defense shall be the liability of the Indemnifying Party hereunder. In any case,
whether or not the Indemnifying Party elects to control the defense of a Third
Party Claim, the Indemnified Party shall not consent to the entry of any
judgment or enter into any settlement in respect of a Third Party Claim without
the prior written consent of the Indemnifying Party, and without such consent
the Indemnifying Party shall not be obligated to indemnify the Indemnified Party
hereunder in respect of the related Indemnification Claim; provided, that the
                                                           --------
consent of the Indemnifying Party shall not be unreasonably withheld,
conditioned or delayed. To the extent the Indemnifying Party shall direct,
control or participate in the defense or settlement of any Third Party Claim,
the Indemnified Party will, as reasonably required, give the Indemnifying Party
and its counsel access to, during normal business hours, the relevant business
records and other documents, and permit them to consult with the employees and
counsel of the Indemnified Party. Regardless of which Person assumes control of
the defense of any claim, each Party shall cooperate and provide the other Party
reasonable assistance in the defense thereof.

          2.4 Procedure for Transaction Claims. Any Transaction Claim which may
              --------------------------------
form a basis for indemnification hereunder shall be asserted and resolved as set
forth in this Section 2.4.

          (a) Following the receipt of notice of a Transaction Claim, the
     Company Indemnified Party or the party receiving the notice of the
     Transaction Claim shall promptly, but in no event more than 5 Business Days
     following such Party's receipt of notice of such Transaction Claim, give
     written notice to the Indemnifying Party, which notice shall state in
     reasonable detail the nature and basis of the Transaction Claim and the
     amount or estimated amount thereof to the extent feasible (which estimate
     shall not be conclusive of the final amount of such claim) and, if the
     party giving such a notice is a Company Indemnified Party, specifying the
     basis hereunder upon which the Company Indemnified Party's claim for
     indemnification is asserted. Any failure to deliver such a notice will not
     relieve the Indemnifying Party from any obligation hereunder except if and
     to the extent the indemnifying parties are actually prejudiced as a result
     thereof. If the Transaction Claim is an Appraisal Claim, then the Company
     shall provide the Indemnifying Party with a certificate of the President or
     Vice President of the Company certifying the number of shares of the
     Company's stock as to which demand for appraisal shall have been properly
     made and shall periodically thereafter report any changes in the number of
     shares as to which appraisal rights are, or potentially still able to be,
     perfected under Section 262 of the Delaware General Corporation Law (the
     "DGCL").
      ----

          (b) The Buyer may elect to assume the defense of the Transaction Claim
     with counsel of its choice reasonably satisfactory to the Company
     Indemnified Parties (it being agreed that the Wilmington, DE office of
     Skadden, Arps, Slate, Meagher & Flom LLP is satisfactory), regardless of
     whether the Company or any other Party had previously assumed such defense.
     The Company shall cause its counsel to cooperate with Buyer in this regard.
     The expenses incurred in such defense (including reasonable fees and
     expenses of outside counsel referred to in the immediately preceding
     sentence) shall be advanced by the Buyer but shall be considered
     Liabilities under such

                                       3

<PAGE>

     Transaction Claim for purposes of this Agreement and Buyer shall be
     reimbursed for 40% thereof as provided in Section 2.1 above. The Company
     Indemnified Parties may retain separate counsel and participate in the
     defense of the Transaction Claim, it being understood that the Buyer will
     control such defense, and the cost of such counsel shall constitute a
     Transaction Claim for purposes hereof.

          (c) The Buyer shall have the right to contest, defend and litigate all
     Transaction Claims. The Buyer shall not settle or compromise any
     Transaction Claim without the consent of the Company (which consent will
     not be unreasonably withheld). No Company Indemnified Party shall settle or
     compromise any Transaction Claim without the consent of the Buyer (which
     consent will not be unreasonably withheld).

          (d) If the Company Indemnified Parties are entitled to indemnification
     against a Transaction Claim, and Buyer fails to assume the defense of a
     Transaction Claim pursuant to Section 2.4(b), the Company Indemnified
     Parties shall have the right, without prejudice to the Company Indemnified
     Parties' right of indemnification hereunder, in their good faith
     discretion, to contest, defend and litigate such a Transaction Claim. If
     pursuant to this Section 2.4, the Company Indemnified Parties so contest,
     defend or litigate a Transaction Claim, for which they are entitled to
     indemnification hereunder as hereinabove provided, the Company Indemnified
     Parties shall be reimbursed by Buyer for 60% of the reasonable attorney's
     fees and other expenses and court costs of defending, contesting and
     litigating the Transaction Claim which are incurred from time to time,
     following the presentation to Buyer or itemized bills for said attorneys'
     fees and other expenses and court costs.

          (e) Buyer will keep the Company Indemnified Parties, and the Company
     will keep the Buyer, informed of all material developments relating to or
     in connection with all Transaction Claims. The parties to this Agreement
     shall cooperate in the investigation and defense thereof, which cooperation
     shall include the provision of records and information which are reasonably
     relevant to such Transaction Claim, and making employees available on a
     mutually convenient basis to provide additional information and explanation
     of any material provided hereunder.

          (f) Notwithstanding anything to the contrary contained in this
     Agreement or in the Merger Agreement, in the event that, in connection with
     any settlement or judgment with respect to any Transaction Claim that is an
     Appraisal Claim, the per share consideration paid to any shareholder of the
     Company or ABC exercising dissenters' rights pursuant to Section 262 of the
     DGCL is less than the Company Merger Consideration or ABC Merger
     Consideration that such shareholder would otherwise have been entitled to
     receive pursuant to the Merger Agreement had such shareholder not exercised
     dissenters' rights, then the Company shall be required to promptly pay the
     Buyer an amount equal to 60% of such shortfall.

          (g) In the event of payment in full by the Indemnifying Party to any
     Company Indemnified Party in connection with any Transaction Claim, the
     Indemnifying Party will be subrogated and will stand in the place of the
     Company Indemnified Party as to any events or circumstances in respect of
     which the Company Indemnified Party may have any right or claim relating to
     such Transaction Claim against any claimant or plaintiff asserting such
     claim or against any other person. The Company Indemnified Parties will
     cooperate with the Indemnifying Parties in a reasonable manner, and at the
     cost and expense of the Indemnifying Party, in prosecuting any subrogated
     right or claim.

          2.5 Indemnity Reduction Amounts.  The amount which any Indemnifying
              ---------------------------
Parties are or may be required to pay to any Indemnified Parties in respect of
Liabilities arising under any Indemnity

                                       4

<PAGE>

Claim or Transaction Claim will be reduced by any amounts actually received
(including amounts received under insurance polices) by or on behalf of the
Indemnified Parties from third parties relating to such payment (such amounts
are referred to herein as "Indemnity Reduction Amounts"). If the Indemnified
Parties receive any Indemnity Reduction Amounts in respect of an Indemnity Claim
or Transaction Claim after the full amount of such Indemnified Claim has been
paid by the Indemnifying Parties or after the Indemnifying Parties have made a
partial payment of such Indemnified Claim and such Indemnity Reduction Amounts
exceed the remaining unpaid balance of such Indemnity Claim or Transaction
Claim, then the Indemnified Parties will promptly remit to the Indemnifying
Parties an amount equal to the excess of (i) the amount theretofore paid by the
Indemnifying Parties in respect of such Indemnity Claim or Transaction Claim,
less (ii) the amount of the indemnity payment that would have been due if such
Indemnity Reduction Amounts in respect thereof had been received before the
indemnity payment was made. An insurer or other third party who would otherwise
be obligated to pay any claim shall not be relieved of the responsibility with
respect thereto or, solely by virtue of the indemnification provisions hereof,
have any subrogation rights with respect thereto, it being expressly understood
and agreed that no insurer or any other third party shall be entitled to any
benefit they would not be entitled to receive in the absence of the
indemnification provisions by virtue of the indemnification provisions hereof.

                                  ARTICLE III

                                 Confidentiality

     3.1 Confidential Information. The Parties hereto expressly acknowledge and
         ------------------------
agree that all information, whether written or oral, furnished by either Party
to the other Party or any Affiliate of such other Party pursuant to this
Agreement, including any schedules and exhibits hereto ("Confidential
                                                         ------------
Information") shall be deemed to be confidential and shall be maintained by each
-----------
Party and their respective Affiliates in confidence, using the same degree of
care to preserve the confidentiality of such Confidential Information that the
Party to whom such Confidential Information is disclosed would use to preserve
the confidentiality of its own information of a similar nature and in no event
less than a reasonable degree of care. Except as authorized in writing by the
other Party, neither Party shall at any time disclose or permit to be disclosed
any such Confidential Information to any person, firm, corporation or entity,
(i) except as may reasonably be required in connection with the performance of
this Agreement by Buyer, the Company or their respective Affiliates, as the case
may be, and (ii) except to the Parties' agents or representatives who are
informed by the Parties of the confidential nature of the information and are
bound to maintain its confidentiality, and (iii) in the course of due diligence
in connection with the sale of all or a portion of either Party's business,
provided the disclosure is pursuant to a written nondisclosure agreement having
terms comparable to Sections 3.1 and 3.2.

     3.2 Exceptions. The obligation not to disclose information under Section
         ----------
3.1 shall not apply to information that, as of the Closing or thereafter, (i) is
or becomes generally available to the public other than as a result of
disclosure made after the execution of the Asset Purchase Agreement by the Party
desiring to treat such information as nonconfidential or any of its Affiliates
or representatives thereof, (ii) was or becomes readily available to the Party
desiring to treat such information as nonconfidential or any of its Affiliates
or representatives thereof on a nonconfidential basis prior to its disclosure to
such Party by the other Party, or (iii) becomes available to the Party desiring
to treat such information as nonconfidential or any of its Affiliates or
representatives thereof on a nonconfidential basis from a source other than its
own files or personnel or the other Party or its Subsidiaries, provided, that
                                                               --------
such source is not known by the Party desiring to treat such information as
nonconfidential to be bound by confidentiality agreements with the other party
or its Affiliates or by legal, fiduciary constraints on disclosure of such
information, or (iv) is required to be disclosed pursuant to a governmental
order or

                                       5

<PAGE>

decree or other legal requirement (including the requirements of the U.S.
Securities and Exchange Commission and the listing rules of any applicable
securities exchange), provided, that the Party required to disclosure such
                      --------
information shall give the other Party prompt notice thereof prior to such
disclosure and, at the request of the other Party, shall cooperate in all
reasonable respects in maintaining the confidentiality of such information,
including obtaining a protective order or other similar order. Nothing in this
Section 3.2 shall limit in any respect either Party's ability to disclose
information in connection with the enforcement by such Party of its rights under
this Agreement.

                                   ARTICLE IV

                            Miscellaneous and General

          4.1 Modification or Amendment. Subject to the provisions of applicable
              -------------------------
law, the parties hereto may only modify or amend this Agreement by written
agreement executed and delivered by duly authorized officers of Buyer and the
Company.

          4.2 Counterparts. This Agreement may be executed in any number of
              ------------
counterparts, each such counterpart being deemed to be an original instrument,
and all such counterparts shall together constitute the same agreement.

          4.3 GOVERNING LAW AND VENUE: WAIVER OF JURY TRIAL
              ---------------------------------------------

          (a) THIS AGREEMENT AND ANY DISPUTES, CLAIMS OR CONTROVERSIES ARISING
     FROM OR RELATING TO THIS AGREEMENT SHALL BE DEEMED TO BE MADE IN AND IN ALL
     RESPECTS SHALL BE INTERPRETED, CONSTRUED AND GOVERNED BY AND IN ACCORDANCE
     WITH THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT OF LAW
     PRINCIPLES THEREOF. Each of the Company and Buyer hereby irrevocably
     submits to the jurisdiction of the courts of the State of New York and the
     Federal courts of the United States of America located in the County of New
     York, New York solely in respect of the interpretation and enforcement of
     the provisions of this Agreement and of the documents referred to in this
     Agreement, and in respect of the transactions contemplated hereby, and
     hereby waive, and agree not to assert, as a defense in any action, suit or
     proceeding for the interpretation or enforcement of this Agreement or of
     any such document, that it is not subject thereto or that such action, suit
     or proceeding may not be brought or is not maintainable in said courts or
     that the venue thereof may not be appropriate or that this Agreement or any
     such document may not be enforced in or by such courts, and each of the
     Company and Buyer irrevocably agrees that all claims with respect to such
     action or proceeding shall be heard and determined in such a New York State
     or Federal court. Each of the Company and Buyer hereby consents to and
     grants any such court jurisdiction over the person of such party and over
     the subject matter of such dispute and agree that mailing of process or
     other papers in connection with any such action or proceeding in the manner
     provided in Section 4.4 or in such other manner as may be permitted by law
     shall be valid and sufficient service thereof.

          (b) EACH OF COMPANY AND BUYER ACKNOWLEDGES AND AGREES THAT ANY
     CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE
     COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY
     IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A
     TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING
     OUT OF OR RELATING TO THIS AGREEMENT,

                                       6

<PAGE>

     OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH PARTY CERTIFIES
     AND ACKNOWLEDGES THAT (i) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER
     PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
     NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (ii)
     EACH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER,
     (iii) EACH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (iv) EACH PARTY HAS
     BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE
     MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 4.3.

        4.4 Notices. Any notice, request, instruction or other document to be
            -------
given hereunder by any party to the others shall be in writing and shall be
deemed to have been delivered (i) on the date of service, if served personally,
(ii) upon confirmation of receipt, if transmitted by facsimile, electronic or
digital transmission method, (iii) on the first business day after sent, if sent
for next day delivery by recognized overnight delivery service and (iv) on the
third day after it is sent, if sent by first class mail. In each case, notice
shall have been sent to the Parties at the following addresses:

        if to Buyer
        -----------

        Armkel, LLC
        c/o Kelso & Company
        320 Park Avenue, 24/th/ Floor
        New York, NY 10022
        Attention: James J. Connors, II, Esq.
        Telecopy: (212) 223-2379

        (with copies to:

        Ronald Beard, Esq.
        Gibson, Dunn & Crutcher LLP
        4 Park Plaza
        Irvine, California 92614
        Telephone:  949-451-4089
        Facsimile:  949-475-4730

        Steven P. Buffone
        Barbara L. Becker
        Gibson, Dunn & Crutcher LLP
        200 Park Avenue
        New York, New York 10166
        Telephone:  212-351-4000
        Facsimile:  212-351-4035

        and

                                       7

<PAGE>

         Lou R. Kling
         Eileen T. Nugent
         Skadden, Arps, Slate, Meagher & Flom LLP
         Four Times Square
         New York, New York 10036
         Telephone: 212-735-2770
         Facsimile: 212-735-2000

         if to the Company
         -----------------

         MedPointe Inc.
         51 JFK Parkway
         1/st/ Floor West
         Short Hills, NJ 07078
         Attention:  Anthony H. Wild
         fax:  (973) 218-2704

         (with a copy to:

         William E. Curbow, Esq.
         Simpson Thacher & Bartlett
         425 Lexington Avenue
         New York, New York 10017
         Telephone:  212-455-3160
         Facsimile:  212-455-2502)

or to such other persons or addresses as may be designated in writing by the
Party to receive such notice as provided above.

        4.5 Entire Agreement. This Agreement, the Asset Purchase Agreement and
            ----------------
the other Ancillary Agreements (as defined in the Asset Purchase Agreement),
including any schedules and exhibits hereto or thereto, constitute the entire
agreement and supersede all other prior agreements, understandings,
representations and warranties both written and oral, among the Parties with
respect to the subject matter of this Agreement.

        4.6 Severability. It is the intention of the Parties that the provisions
            ------------
of this Agreement shall be deemed severable and the invalidity or
unenforceability of any provision shall not affect the validity or
enforceability of the other provisions of this Agreement. It is the intention of
the Parties that if any provision of this Agreement, or the application thereof
to any Person or any circumstance, is invalid or unenforceable, (a) a suitable
and equitable provision shall be substituted therefor in order to carry out, so
far as may be valid and enforceable, the intent and purpose of such invalid or
unenforceable provision and (b) the remainder of this Agreement and the
application of such provision to other Persons or circumstances shall not be
affected by such invalidity or unenforceability, nor shall such invalidity or
unenforceability affect the validity or enforceability of such provision, or the
application thereof, in any other jurisdiction.

        4.7 Assignment. This Agreement and any rights and obligations hereunder
            ----------
shall not be assignable by any Party whether by operation of law or otherwise,
without the prior written consent of the other Party, and any assignment made in
contravention of this Section 4.7 shall be null and void.

                                       8

<PAGE>

        4.8  No Third-Party Beneficiary Rights. This Agreement is not intended
             ---------------------------------
to confer upon any Person, other than the Company Indemnified Parties and the
Buyer Indemnified Parties and other than as set forth below, any rights or
remedies hereunder or in connection herewith. Company's and Buyer's Affiliates
and Company's and Buyer's successors and permitted assigns are intended third
party beneficiaries of this Agreement.

        4.9  Headings/Construction. Section headings contained in this Agreement
             ---------------------
are for convenient reference only, and shall not in any way affect the meaning
or interpretation of this Agreement. The language used in this Agreement will be
deemed the language chosen by the Parties to express their mutual intent, and no
rule of strict construction will be applied against any Person.

        4.10 Amendments and Waivers to Other Indemnification Agreement. The
             ---------------------------------------------------------
Company will not amend, modify or waive any rights under the Indemnification
Agreement, dated as of the date hereof, by and among certain stockholders of
ABC, the Company and Carter-Wallace Inc. (the "Other Indemnification Agreement")
                                               -------------------------------
if such amendment, modification or waiver directly or indirectly relates to
Transaction Claims.

        4.11 Product Line Purchase Agreement. The Company shall have the right
             -------------------------------
to enforce Buyer's rights against Church & Dwight Co., Inc. ("Church & Dwight")
                                                              ---------------
under the Product Line Purchase Agreement (the "Product Line Purchase
                                                ---------------------
Agreement") dated as of the date of this Agreement between Buyer and Church &
---------
Dwight if Buyer fails to do so, to the extent Buyer has failed to indemnify the
Company with respect to Assumed Liabilities for which Church & Dwight is
obligated to assume or indemnify Buyer under the Product Line Purchase
Agreement, and a provision to such effect shall be included in such Product Line
Purchase Agreement.

                                       9

<PAGE>

        IN WITNESS WHEREOF, the Parties have caused this Agreement to be
executed by their proper officers, duly authorized to do so, as of the date
first written above.

                                            Carter-Wallace, Inc.

                                            By:  ___________________________
                                                     Name:
                                                     Title:

                                            Armkel, LLC

                                            By:      _________________________
                                                     Name:
                                                     Title:

                                       10

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