Document:

exv10w1

 

Exhibit 10.1

Execution Copy

OTC LICENSE AGREEMENT

By and Between

SANTARUS, INC.

and

SCHERING-PLOUGH HEALTHCARE PRODUCTS, INC.

CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A
REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.

 

 

OTC LICENSE AGREEMENT

     This OTC License Agreement (the “Agreement”), dated the 17th day of October, 2006,
is by and between Santarus, Inc., a Delaware corporation having offices at 10590 West Ocean Air
Drive, Suite 200, San Diego, CA 92130 (“Santarus”), and Schering-Plough Healthcare Products, Inc.,
a Delaware corporation having offices at 556 Morris Avenue, Summit, NJ 07901-1330 (“Schering”)
(each a “Party” and collectively, the “Parties”).

RECITALS

     Whereas, Santarus has developed, manufactures, markets and sells a line of pharmaceutical
products based on proton pump inhibitors in combination with one or more buffering agents under the
Zegerid® brand and available by prescription;

     Whereas, Schering is interested in developing, marketing and selling a version of those
products for the OTC market to provide consumers with easier access to therapeutic relief for
certain health conditions; and

     Whereas, Schering has experience and expertise in developing, marketing and selling
pharmaceutical products for the OTC market and in successfully establishing brand strength; and

     Whereas, Santarus is interested in licensing Schering to utilize its resources and
capabilities, in coordination with Santarus and subject to the terms and conditions set forth
herein, to develop and commercialize OTC versions of its Zegerid brand products for the OTC market
in the Territory; and

     Whereas, Santarus and Schering are interested in establishing a relationship pursuant to which
Santarus shall grant to Schering certain rights and licenses under the Santarus IP to develop,
manufacture, market and sell Licensed Products for Licensed Indications in the Field and Territory;
and

     Whereas, Schering and Santarus are interested in entering into an exclusive arrangement, as
set forth more specifically in this Agreement, to benefit both the OTC products developed and
commercialized by Schering hereunder and Zegerid brand prescription products developed and
commercialized by Santarus, in each case using the Product Marks and/or Santarus Marks, and to help
maximize brand value in the Territory; and

     Whereas, Santarus and Schering wish to establish a joint steering committee as set forth
herein to monitor Schering’s development and commercialization of Licensed Products for the OTC
market, and to facilitate communications between them regarding development and commercialization
of the Licensed Products for the OTC market and Santarus’ Prescription Products, and to provide a
venue for discussion and/or approval of certain activities of Schering under the Santarus IP and
concerning the Licensed Products in the Territory in order to ensure that Schering is not exceeding
the scope of its license grant by taking actions that are likely to reduce the market for
Prescription Products bearing the Santarus Marks and would not otherwise be permitted under this
Agreement.

     NOW THEREFORE, for and in consideration of the covenants, conditions, and undertakings
hereinafter set forth, it is agreed by and between the Parties as follows.

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ARTICLE 1

DEFINITIONS

     All references to Exhibits, Articles and Sections shall be references to Exhibits, Articles
and Sections of this Agreement. Except where the context otherwise requires, wherever used, the
singular shall include the plural, the plural the singular, the use of any gender shall be
applicable to all genders. The term “including” as used herein shall mean including, without
limiting the generality of any description preceding such term. In addition, except as otherwise
expressly provided herein, the following terms in this Agreement shall have the following meanings:

     1.1 “Adverse Event” means any undesirable event or experience associated with the use
of a medicinal product, including a biological product or medical device in humans, whether or not
expected, and whether or not considered related to or caused by the product, including, but not
limited to, an event or experience that occurs: in the course of the use of the product in
professional practice; from overdose whether accidental or intentional; from abuse; from
withdrawal; or from a failure of expected pharmacological or biological therapeutic action of the
product.

     1.2 “Affiliate” means any corporate or other entity which, directly or indirectly,
controls, is controlled by, or is under common control with such party where “control” means the
ownership of more than 50% of the voting shares of a corporation, or ability to control the
management decisions thereof, or decision-making authority as to an unincorporated entity.

     1.3 “Business Day” means a day other than a Saturday, Sunday, bank or other United
States Government holiday.

     1.4 “Combination Product(s)” means any product containing both a Licensed Product and
one or more other pharmaceutically active agents or active ingredients that do not constitute a
Licensed Product. For purposes of this definition, the omeprazole and buffering agent(s) contained
in a Product shall not be considered to be “pharmaceutically active agents or active ingredients
that do not constitute a Licensed Product”.

     1.5 “Confidential Information” shall have the meaning ascribed to it in Section 8.1.

     1.6 “Control” or “Controlled” means, with respect to any Santarus IP or
Schering Incorporated IP, possession (whether by ownership or license, other than pursuant to this
Agreement) by a Party or its Affiliates of the ability to grant the licenses or sublicenses as
provided for herein without violating the terms of any agreement or other arrangement with any
Third Party.

     1.7 “Effective Date” means the date upon which the applicable waiting period under the
HSR Act expires or is earlier terminated.

     1.8 “FDA” means the United States Food and Drug Administration.

     1.9 “Field” means all therapeutic uses and Indications in humans for which a
physician’s prescription is not required. This may be used interchangeably with the phrase “OTC
market”.

     1.10 “First Commercial Sale” means the date of the first, bona-fide, arms-length
commercial sale (other than for purposes of clinical trials, regulatory approval, compassionate use
or test marketing) of a Licensed Product after Marketing Approval in the Field in the Territory by
or on behalf of Schering, an Affiliate or Sublicensee.

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     1.11 “Formulation” means, with respect to a Product, a pharmaceutically acceptable
composition differing from other forms of such Product by choice of excipients (e.g., added
flavoring), route of administration (e.g., oral versus cutaneous), release rate of the active
pharmaceutical ingredient and/or dosage form (e.g., liquid versus capsule). For clarity,
“Formulations” of a Licensed Product shall exclude versions of such Licensed Product differing in
strength or dosage amount of omeprazole.

     1.12 “Hatch-Waxman Act” means the U.S. Federal Drug Price Competition and Patent Term
Restoration Act of 1984, as amended.

     1.13 “HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended.

     1.14 “Indication” means a medical condition for which a pharmaceutical product is
intended to be used. With respect to Licensed Products, Indications are approved by a Regulatory
Authority (whether by monograph or NDA) and stated on packaging materials, labels and/or labeling
accompanying the Product.

     1.15 “Initial Indication” means the short term (rather than chronic) prevention,
treatment and relief of heartburn and frequent heartburn in adults (18 years or older).

     1.16 “Initial Product” means Formulations of the Licensed Product containing a 20 mg
dose of omeprazole formulated in combination with one or more buffering agents and that, as of the
date of this Agreement, are being marketed or are in development by Santarus (which are the
capsule, caplet, chewable tablet, or powder for oral suspension Formulations).

     1.17 “Licensed Indications” means (i) the Initial Indication, and (ii) any other
Indications for Licensed Products that are approved in accordance with Section 2.6 and Section
2.6.4, as applicable.

     1.18 “Licensed Product(s)” means any of the following OTC Products: (i) Products
containing a 20 mg dose of omeprazole and no other PPI, (ii) Products containing omeprazole (and no
other PPI) at doses other than 20 mg, if any, that have been approved in accordance with Section
2.6 and Section 2.6.4, as applicable, and (iii) Combination Products that are approved in
accordance with Section 2.6 and Section 2.6.4, as applicable.

     1.19 “Managed Care Market” means health maintenance organizations, private health
insurers, pharmaceutical benefits managers, government payors (including Medicare Part D),
long-term care providers, organized employer formularies and group purchasing organizations and
other organized buyer groups, which group purchasing organizations and other organized buyer groups
are not themselves retailers, wholesalers or other distributors of Licensed Products.

     1.20 “Marketing Approval” means any approval, product and/or establishment license,
registration or authorization of any Regulatory Authority necessary for the commercial manufacture,
use, storage, import, export, transport, distribution, marketing or sale of a Product.

     1.21 “Marketing Commitment” means the out-of-pocket amount incurred by Schering to
market the first Licensed Product (in each case, to the extent not deducted from gross sales in
determination of Net Sales), including marketing programs, consumer promotions, consumer
advertising, consumer events, product public relations (excluding general corporate public
relations), product display and trade promotion, as well as Emerging Issues Task Force (EITF) trade
and consumer allowances.

     1.22 “Missouri Agreement” means that certain license agreement between Santarus and
the Curators of the University of Missouri dated January 26, 2001, as amended.

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     1.23 “NDA” means a New Drug Application filed with the FDA, for approval by such
agency for the sale of a pharmaceutical product in the United States pursuant to the Federal Food,
Drug and Cosmetics Act, as amended from time to time, and the rules, regulations and guidelines
promulgated thereunder, as well as the equivalent in any other country in the Territory. This
expressly includes so called “ANDAs” and “505(b)(2)” NDA forms.

     1.24 “Net Sales” means the gross amount charged by Schering and its Affiliates and
Sublicensees to Third Parties for the sales of Licensed Products in the Territory, less the
following deductions to the extent included within the gross sales amounts (determined in
accordance with generally accepted accounting principles in the United States), if any:

     (a) [***];

     (b) [***];

     (c) [***]; and

     (d) [***].

Net Sales shall not include sales of Licensed Products between and among Schering and its
Affiliates and Sublicensees; provided, however, that Net Sales shall include the amounts invoiced
by Schering, its Affiliate or Sublicensee upon any resale of such Licensed Products to a Third
Party.

     1.25 “OTC Product” means all Formulations, dosages, package sizes and configurations
and types of Products for which a prescription from a health care practitioner is not required in
order to dispense, purchase or use such Product in the Territory.

     1.26 “PPI” means proton pump inhibitor.

     1.27 “PPI Pharmaceutical Product” means [***].

     1.28 “Prescription Product(s)” means all Formulations, dosages, package sizes and
types of Products for which a prescription from a health care practitioner is required in order to
dispense, purchase or use such Product in the Territory.

     1.29 “Product(s)” means pharmaceutical compositions containing any one or more PPIs in
combination with one or more buffering agents, which pharmaceutical compositions provide for
immediate release of the PPI included in such product, including (i) any prodrugs and metabolites,
and all esters, salts, hydrates, solvates, polymorphs and isomers of any of the above, (ii)
chemical analogs, and (iii) Formulations (including tablets, chewable tablets, capsules, caplets,
liquid forms and powders for oral suspensions) of any of the above.

     1.30 “Product Marks” means the US and non-US trademark registrations and trademark
applications and common law rights, in the Territory, in (i) up to five (5) product names selected
by Schering on or before November 30, 2006, on written notice to Santarus, from the list of product
names set forth in Exhibit A (and corresponding domain names for such selected product names) and
(ii) any additional names or marks for identifying the Licensed Products containing the name
“Zegerid” in combination with other words or symbols (and/or corresponding domain names) as may be
agreed to by the JSC from time to time.

     1.31 “Product Quality Complaint” means any written, electronic or oral communication
that alleges deficiencies related to the identity, strength, quality or purity of a Product after
it is released for commercial use.

     1.32 “Regulatory Authority” means a federal, national, multinational, or other
regulatory agency or governmental entity involved in the granting of marketing approval for a
pharmaceutical product in a country (e.g., the FDA).

 

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

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     1.33 “Regulatory Filing” means any written application, submission, notice or other
filing made to an applicable Regulatory Authority in a country in the Territory: (i) seeking
Marketing Approval for the commercial manufacture, use, storage, import, export, transport,
distribution, marketing or sale of a Product, as well as an Investigational New Drug Application
(as defined in the Federal Food, Drug and Cosmetics Act, as amended from time to time, and the
rules, regulations and guidelines promulgated thereunder); or (2) that is required to be filed with
the FDA before beginning clinical testing of a pharmaceutical product in human subjects; or (3) any
successor application or procedure; or (4) non-U.S. equivalents to any of the foregoing; and (5)
all supplements and amendments that may be filed with respect to any of the foregoing.

     1.34 “Santarus Know-How” means all proprietary materials, ideas, inventions, data,
instructions, processes, formulas, expert opinions and information that in each case are disclosed
hereunder and both: (a) owned or Controlled by Santarus; and (b) reasonably necessary for practice
of the Santarus Patents as licensed to Schering herein and/or the development, testing, use,
manufacture or sale of Licensed Products in the Field in the Territory in accordance with this
Agreement. Santarus Know-How includes data generated in pre-clinical and clinical studies
(including post-approval studies), information contained in Regulatory Filings, communications and
correspondence with Regulatory Authorities, and product development and manufacturing data, in each
case which relate to Licensed Products in the Field and are reasonably necessary for Schering’s
practice of the rights and licenses granted to it hereunder. Santarus Know-How that is Controlled
by Santarus through an in-license from a Third Party is included herein to the extent Santarus has
rights to such Know-How, and subject to the applicable terms and conditions set forth in the
applicable in-license.

     1.35 “Santarus Marks” means all US and non-US trademarks, and trademark applications
and registrations, in the Territory consisting of the name “Zegerid” and any other trademark or
domain name (other than the Product Marks) containing the name “Zegerid,” or a close variant or
derivative thereof, alone or in combination with other words or symbols, whether registered or
unregistered, and all common law rights, applications and registrations in the foregoing, in each
case which are owned or Controlled by Santarus as of the date of this Agreement or during its term.
“Santarus Marks” shall also mean such other name or mark as may be used by or under authority of
Santarus for Products in the Zegerid line in the event that regulatory or legal action causes
Santarus to cease use of the name “Zegerid”

     1.36 “Santarus Patents” means: (i) the patents and patent applications listed in
Exhibit B, including those in-licensed by Santarus in the Missouri Agreement; and (ii) all
additional patent applications and patents owned or Controlled by Santarus in the Territory which
are directed to pharmaceutical products containing one or more PPIs with one or more buffering
agents and which pharmaceutical products provide for immediate release of the PPI included in such
product, except as otherwise provided in Section 6.3.2. With respect to the patents and patent
applications described in each of (i) and (ii) above, the term “Santarus Patents” also includes any
addition, continuation, continuation-in-part or division thereof or any substitute application
therefor; any patent issued with respect to such patent application, any reissue, extension or
patent term extension of any such patent, and any confirmation patent or registration patent or
patent of addition based on any such patent; in each case that is in the Territory. Santarus
Patents that are Controlled by Santarus through an in-license from a Third Party are included
herein to the extent Santarus has rights to such Santarus Patents, and subject to the applicable
terms and conditions set forth in the applicable in-license. With respect to patents and patent
applications, if any, within the Santarus Patents that are owned by a Third Party and licensed to
Santarus pursuant to a license agreement executed after the Effective Date of this Agreement, such
patents and patent applications shall only be included within Santarus Patents, and sublicensed to
Schering under this Agreement, if Schering agrees in writing to reimburse

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Santarus for all royalties and other amounts that Santarus would be obligated to pay
thereunder with respect to Schering’s activities hereunder on account of such sublicense.
Notwithstanding the foregoing, “Santarus Patents” shall not include the patents and patent
applications indicated as “Excluded Patents” on Exhibit B, or any addition, continuation,
continuation-in-part or division thereof or substitute application therefor, or any patent issued
with respect to such patent application(s), reissues, extensions or patent term extensions of any
such patent, and any confirmation patent or registration patent or patent of addition based on any
such patent.

     1.37 “Santarus IP” means the Santarus Patents, Santarus Know-How and Santarus Marks.

     1.38 “Schering Incorporated IP” means Schering Patents and Schering Know-How utilized
during the term of this Agreement that are necessary for, or used in, the manufacture, use or sale
of, and/or are incorporated into, Licensed Products as manufactured, used or sold by Schering or
its Affiliates or Sublicensees, including without limitation clinical, stability and other data
concerning such Licensed Products within the Schering Know-How.

     1.39 “Schering Know-How” means all proprietary materials, ideas, inventions, data,
instructions, processes, formulas, expert opinions and information that in each case are disclosed
hereunder and are both: (a) owned or Controlled by Schering or any of its Affiliates; and (b) used
in or for Licensed Products in the Territory and are useful for practice of the Schering Patents or
for the development, testing, use, manufacture or sale of Prescription Products in the Territory.
Schering Know-How includes data generated in pre-clinical and clinical studies (including
post-approval studies), information contained in Regulatory Filings, communications and
correspondence with Regulatory Authorities, and product development and manufacturing data.

     1.40 “Schering Marks” means all US and non-US trademarks, and trademark applications
and registrations, other than the Product Marks, in the Territory used in connection with the
Licensed Products and any other trademark, trade dress or domain name, other than the Product
Marks, used in connection with the Licensed Products including logos, designs, slogans, and
graphics, packaging design and trade dress, whether registered or unregistered, and all common law
rights, applications and registrations therefore, in each case which are owned or Controlled by
Schering as of the date of this Agreement or during its term.

     1.41 “Schering Patents” means all patent applications and patents owned or Controlled
by Schering or any of its Affiliates as of the date of this Agreement or during its term and
claiming compositions of matter, methods of use or methods of manufacture of Licensed Products as
developed, manufactured or sold by Schering or its Affiliates or Sublicensees. The term “Schering
Patents” also includes any addition, continuation, continuation-in-part or division thereof or any
substitute application therefore; any patent issued with respect to such patent application, any
reissue, extension or patent term extension of any such patent, and any confirmation patent or
registration patent or patent of addition based on any such patent. With respect to patents and
patent applications, if any, within the Schering Patents that are owned by a Third Party and
licensed to Schering pursuant to a license agreement executed after the Effective Date of this
Agreement, such patents and patent applications shall only be included within Schering Patents, and
sublicensed to Santarus under this Agreement, if Santarus agrees in writing to reimburse Schering
for all royalties and other amounts that Schering would be obligated to pay with respect to
Santarus’ activities hereunder on account of such sublicense.

     1.42 “Sublicensee” means a Third Party to which Schering or its Affiliates have
granted a sublicense under the licenses conveyed to Schering under the Santarus IP as set forth in
Article 4 to make, have made, use, sell, offer for sale, or import a Licensed Product in the Field
in the Territory. As used in this Agreement, Sublicensee shall also include a Third Party to

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whom Schering or its Affiliates have granted, directly or indirectly, the right to distribute
a Licensed Product, provided that such Third Party has the responsibility for marketing and/or
promotion of a Licensed Product within the markets/territory(ies) for which such distribution
rights are granted. For the avoidance of doubt, wholesalers, sales brokers and retailers who do
not have such responsibilities shall not be deemed to be Sublicensees. Contract manufacturers
shall not be deemed to be Sublicensees.

     1.43 “Territory” means the United States (including its territories and possessions)
and Canada.

     1.44 “Third Party” means any entity other than Santarus or Schering or any of their
respective Affiliates.

     1.45 “Valid Claim” means any claim in an issued and unexpired Santarus Patent that has
not been revoked or held unenforceable, unpatentable or invalid by a decision of a court or other
governmental agency of competent jurisdiction, with such decision being unappealable or unappealed
within the time allowed for appeal.

ARTICLE 2

RELATIONSHIP MANAGEMENT

     2.1 Joint Steering Committee. Promptly after the Effective Date, Santarus and Schering shall
establish a joint steering committee (“Joint Steering Committee” or “JSC”) with the functions and
powers set forth in Section 2.6, below, and such other functions and powers as are expressly set
forth in this Agreement or agreed in writing by the Parties. The JSC shall be comprised of three
(3) representatives from each of Santarus and Schering, selected by such Party, with each Party
designating at least one (1) representative who shall be at the Vice President level or above.
Subject to the foregoing provisions of this Section, Santarus and Schering may each replace their
JSC representatives at any time, with prior written notice to the other Party. JSC members may be
employees of a Party’s Affiliate. Each Party’s initial representatives on the JSC are indicated on
Exhibit C.

     2.2 Meetings. Until the later of the third (3rd) anniversary of the Effective Date
and the date of Schering’s first Marketing Approval in the Territory for the first Licensed
Product, the JSC shall meet quarterly, and thereafter semi-annually, or at other times agreed to by
the Parties, to review and discuss Schering’s manufacturing, development, marketing and other
commercialization activities in connection with Licensed Products in the Field (including, without
limitation, the planning and performance of clinical trials and planning and preparation of
Regulatory Filings), as well as to coordinate manufacturing, development and marketing plans for
Licensed Products and Prescription Products bearing the Santarus Marks. The JSC shall meet in
person, or in such other manner (e.g., by telephone or videoconference) and at such times as the
Parties may mutually agree, provided that at least half the meetings per calendar year take place
in person, and such in-person meetings shall alternate between the facilities of the Parties unless
the JSC agrees otherwise. Each Party shall inform the other of its proposed agenda items, to the
extent reasonably practicable, at least one (1) week in advance of each meeting of the JSC. Each
Party shall bear its own personnel, travel, and lodging expenses relating to JSC meetings. Members
of the JSC may be represented at any meeting by a designated substitute; provided at least one (1)
representative of each Party at each meeting shall be at the Vice President level or above. Either
Party may permit additional employees and consultants to attend and participate (on a non-voting
basis) in JSC meetings, subject to the confidentiality provisions of Article 8. Any approval,
determination or other action agreed to by all of the members of the JSC present at the relevant
JSC meeting shall be the approval,

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determination or other action of the JSC, provided that at least two representatives of each
Party are present at such meeting. Schering and Santarus shall each name a representative on the
JSC as its “Co-Chair,” and such persons shall serve as the primary contact for such Party with
respect to JSC matters. The meetings of the JSC shall be chaired by the Schering and Santarus
Co-Chairs in an alternating manner, beginning with Santarus.

     2.3 Minutes and Reports. The JSC shall be responsible for keeping accurate minutes of its
deliberations which record all proposed decisions and all actions recommended or taken. Within ten
(10) Business Days of each meeting, the Alliance Coordinator from the same Party that provided the
Chair for that JSC meeting shall prepare and distribute to the Parties draft minutes of such
meeting, which shall describe in reasonable detail, any issues requiring resolution and any
proposed decisions and actions taken, and the Parties shall provide comments to such drafts within
ten (10) Business Days after receipt. The minutes and written report shall not be final until
agreed to by the Parties’ Co-Chairs. All records of the JSC shall be available to both Parties.

     2.4 Subcommittees.

          2.4.1 General. From time to time, the JSC may establish one or more subcommittees to oversee
particular projects or activities related to Licensed Products, and such subcommittees will be
constituted as the JSC agrees. The subcommittees shall be responsible to oversee activities and
developments within areas delegated to them by the JSC and to make decisions regarding matters
within the purview of such subcommittee. The subcommittees shall have no binding decision-making
authority unless the JSC expressly delegates decision-making authority regarding specified matters
to such subcommittee in writing, in which event decisions of such subcommittee shall be ratified or
overruled promptly by the full JSC. The Parties may replace their respective subcommittee
representatives at any time, upon prior written notice to the other Party. The subcommittee chairs
shall be responsible for preparing the meeting agendas and minutes. Such minutes shall be
distributed to the Parties for comment in draft form within ten (10) Business Days following each
meeting, which shall describe in reasonable detail any issues requiring resolution and any proposed
decisions and actions, and the Parties shall provide comments to such drafts within ten (10)
Business Days after receipt thereof. The minutes shall not be final until agreed by both Parties’
representatives on the subcommittee. Final minutes shall be promptly distributed to the Parties.
Each Party shall bear its own personnel and travel costs and expenses relating to subcommittee
meetings. With the consent of the Parties, other representatives of Santarus or Schering may
attend subcommittee meetings as non-voting observers. Any issue within the purview of such a
subcommittee that is not settled or determined by the applicable subcommittee shall be submitted to
the JSC for resolution. The Chair of each subcommittee shall report on subcommittee efforts at
each JSC meeting, and either Party may invite its own representatives on such subcommittee to also
report on such efforts.

          2.4.2 Initial Subcommittees. The Parties agree that they initially shall form a Development
Subcommittee and a Marketing Subcommittee, each comprised of two (2) members from each Party with
expertise and experience in the applicable area. Schering shall chair each of the subcommittees
unless the JSC agrees otherwise. Each Party’s initial representatives on the Development
Subcommittee and the Marketing Subcommittee are indicated on Exhibit C. The Development
Subcommittee shall facilitate communication, coordination and review between the Parties of matters
relating to development of Licensed Products and regulatory affairs. Unless the JSC delegates such
matters to another subcommittee, the Development Subcommittee shall be responsible to facilitate
communication, coordination and review between the Parties of matters relating to manufacture of
Licensed Products. The Marketing Subcommittee shall facilitate communication, coordination and
review

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between the Parties of matters relating to commercialization and marketing of Licensed
Products. The subcommittees shall meet no less frequently than the JSC, in advance of each JSC
meeting.

     2.5 Decision-Making. Decisions of the JSC shall be made by unanimous vote of the members
present in person or by other means (e.g., teleconference) at any meeting. At least two JSC
representatives from each Party must participate in a meeting of the JSC in order for there to be a
quorum for such meeting. The Parties shall use good faith efforts to reach consensus on all issues
requiring a JSC decision. In the event that the members of the JSC cannot reach unanimous
agreement on a particular issue requiring their decision within thirty (30) days (or such shorter
time as may be reasonably required by the Party whose actions are subject to that decision) after
the meeting at which agreement was requested, then the issue shall be referred to Schering’s
Chairman (or the acting head) of its Consumer Division and the Chief Executive Officer of Santarus,
who shall meet in person or by teleconference in a good faith effort to resolve the dispute within
thirty (30) days thereafter (or such shorter time as may be reasonably required by the Party whose
actions are subject to that decision). In the event such individuals cannot agree on a resolution
of the dispute within such period, the matters described in Section 2.6.3 below shall be finally
determined by Schering’s decision, the matters described in Section 2.6.4 below shall be finally
determined by Santarus’ decision, and all other matters shall not be subject to a deciding vote by
either Party. Notwithstanding the foregoing, in no event shall a Party have the power to exercise
its deciding vote pursuant to this Section 2.5 to: (i) obligate the other Party to incur costs in
excess of those agreed by such other Party; (ii) obligate the other Party to undertake activities
(including without limitation clinical trials) other than those activities agreed to by such other
Party; or (iii) to approve matters other than those expressly subject to its deciding vote as set
forth in Sections 2.6.3 and 2.6.4.

     2.6 JSC Functions and Powers. The JSC shall be the primary vehicle for interaction and
information sharing between the Parties regarding the subject matter of this Agreement, and shall
have as its overall purpose the oversight, review and coordination of the various development,
commercialization, manufacturing and marketing activities for Licensed Products in the Field by
Schering and its Affiliates and Sublicensees, and for consultation and coordination over regulatory
matters concerning Licensed Products, and to ensure that such activities permitted under the
license to Santarus IP are complementary to, and not in direct conflict with, Santarus’ plans and
activities with respect to Prescription Products bearing the Santarus Marks. The JSC also shall
function as a forum for the Parties to inform and consult with each other regarding maximizing
value of the Product Marks and Santarus Marks for Schering and Santarus, and facilitating
communication and cooperation between the Parties regarding Licensed Products, Prescription
Products bearing the Santarus Marks, and the rights licensed to each other. The JSC or a
subcommittee thereof may also serve as a conduit to discuss coordination of (and if agreed by the
Parties facilitate coordination of) supply arrangements of the Parties for active pharmaceutical
ingredient, bulk form and/or finished form Licensed Products and Prescription Products bearing the
Santarus Marks. Without limiting the foregoing, the JSC shall have the specific responsibilities
and decision-making authority as set forth in Sections 2.6.1 through 2.6.4 below, and such other
duties and powers as the Parties may agree in writing. The Parties acknowledge that it is their
intent not to take or approve (or have the JSC approve) Schering’s exercise of rights under the
licensed Santarus IP that could be reasonably likely to reduce the market outside the Field for
Prescription Products bearing the Santarus Marks. The Parties acknowledge that it is their intent
to act in a manner that benefits both Licensed Products in the Field and Prescription Products, in
each case in the Territory and using the Product Marks and/or Santarus Marks, and that lawfully
maximizes brand value in the Territory for Product Marks and Santarus Marks licensed hereunder. In
the event that the

9

 

issues relating to expansion of rights to Schering are no longer a concern for Santarus, the
role of the JSC may be reduced by written agreement of the Parties.

          2.6.1 Matters for JSC Approval. The following shall be subject to JSC review and approval:

          (a) Annual written development plans submitted by Schering to the JSC as described in Section
3.1.1 (and material amendments or revisions to the development plans, as may be needed from time to
time), which plans shall govern the product, clinical and regulatory development activities for
Licensed Products under this Agreement, and related manufacturing activities, and shall include the
following matters:

               (i) high-level plans and strategies for clinical development of Licensed Products;

               (ii) high-level regulatory plans and strategies related to Licensed Products;

               (iii) new Formulations of Licensed Products to be developed;

               (iv) Combination Products (if any) to be developed

               (v) applicable manufacturing plans for Licensed Products; and

               (vi) such other matters as the JSC may agree to include regarding product development,
clinical development and/or regulatory activities for Licensed Products;

          (b) Annual written marketing plans submitted to the JSC as set forth in Section 3.3.2 (and
material amendments or revisions to the marketing plans, as needed from time to time), which plans
shall govern the marketing and commercialization of Licensed Products under this Agreement, and
related manufacturing activities, and shall include the following matters:

               (i) high-level messaging and brand positioning for Licensed Products;

               (ii) high-level trade dress and packaging concepts, including any use of, and coordination
with, Santarus’ copyrighted materials;

               (iii) new Formulations of Licensed Products to be developed;

               (iv) Combination Products (if any) to be developed;

               (v) selection of Product Marks for Licensed Products;

               (vi) to the extent not covered in the development plans, manufacturing plans for commercial
supply of Licensed Products; and

               (vii) such other matters as the JSC may agree to include regarding commercialization and
marketing of Licensed Products under this Agreement;

          (c) [***];

          (d) Expansion of the rights conveyed to Schering hereunder to include any of the following:

               (i) [***];

               (ii) [***];

               (iii) [***];

 

			
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10

 

               (iv) [***]; and

               (v) [***].

          2.6.2 Oversight and Review. In addition, at each meeting of the JSC, as reasonably requested
by either Party’s representatives on the JSC, the JSC will review and monitor Schering’s and its
Affiliates’ and Sublicensees’ activities and progress to develop, commercialize, manufacture and
market Licensed Products in the Field and Territory and, at a higher level, Santarus’ activities to
develop, commercialize, manufacture and market Prescription Products bearing the Santarus Marks
outside the Field and in the Territory. The following matters may be reviewed by the JSC, but are
not subject to JSC approval so long as they are consistent with the JSC-approved development plan
and/or marketing plan, or other JSC approvals as provided by Section 2.6.1 above:

               (a) clinical study protocols for Licensed Products;

               (b) Formulation changes (including without limitation flavors, formats and additional
ingredients) for Licensed Products;

               (c) changed or additional Schering Marks to be used with Licensed Products;

               (d) significant packaging and trade dress modifications for the Licensed Products; and

               (e) advertising campaign changes or other marketing adjustments for Licensed Products.

          2.6.3 Schering Day-to-Day Control and Deciding Vote. Schering shall have decision making
authority, in its discretion, with respect to [***], provided that such decisions are consistent
with the JSC-approved development plan and/or marketing plan, and other decisions of the JSC or
applicable subcommittees (within the scope of their authority), and the terms and conditions of
this Agreement. In addition, if the JSC does not unanimously agree upon the following matters
specified in this Section 2.6.3, and the Parties do not resolve such matters through discussion of
senior management as provided in Section 2.5, then Schering shall have the final decision on:

               (a) [***]; and

               (b) [***].

          2.6.4 Santarus Deciding Vote. In the event the JSC does not unanimously agree upon matters
specified in this Section 2.6.4, and the Parties do not resolve such matters through discussion of
senior management as provided in Section 2.5, then Santarus shall have the final decision with
respect to the following matters:

               (a) [***];

               (b) [***];

               (c) [***];

               (d) [***];

               (e) [***];

               (f) [***]; and

               (g) [***].

          2.6.5 JSC Information. Schering shall keep the JSC and relevant subcommittees informed
regarding the development, manufacturing, marketing and

 

			
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commercialization activities pertaining to Licensed Products in the Field in the Territory by
Schering and its Affiliates and Sublicensees, through quarterly written reports to the JSC or
relevant subcommittees which describe such activities and are of the same scope and same level of
detail as that provided to Schering’s consumer health care division executive management (and of
comparable scope and level of detail with respect to Affiliates and Sublicensees). In the event
that, and at such time as, the JSC does not meet on a quarterly basis, then such reports shall
continue to be provided to the Co-Chairs of the JSC with the same frequency and shall contain a
similar level of detail as previous presentations to the JSC and shall include such information as
Schering presents to its consumer health care division executive management regarding such matters.
Each Party shall use commercially reasonable efforts to promptly inform the JSC of information,
circumstances or developments of which such Party becomes aware (other than news stories, press
releases and other widely available public information) which would reasonably be expected to have,
or pose a reasonable likelihood to have, a material adverse impact on the development,
manufacturing, regulatory approval, or commercialization of the other Party’s Licensed Products in
the Field or Prescription Products in the Territory, as the case may be.

     2.7 Limitation on JSC Authority. Notwithstanding the creation and role of the JSC, each Party
shall retain the rights, powers and discretions granted to it hereunder. The JSC shall not be
delegated or vested with any such rights, powers or discretion unless expressly provided for
herein, and the JSC shall not have the power to make any decisions other than those expressly set
forth in Section 2.6 or elsewhere in this Agreement, except as the Parties may otherwise agree in
writing. Without limiting the generality of the foregoing, the JSC may not amend or modify this
Agreement, which may be amended or modified only as provided in Section 11.6.

     2.8 Alliance Coordinator. The Parties shall each appoint an individual (an “Alliance
Coordinator”) to facilitate the operations of the JSC and subcommittees thereof, and to facilitate
communications between the Parties with respect to the activities under this Agreement. Each
Party’s Alliance Coordinator may attend meetings of the JSC and of subcommittees as a non-voting
representative of such Party (unless the individual serving as Alliance Coordinator is also named
as a member of the JSC or such subcommittee). Each Party may replace its Alliance Coordinator upon
written notice to the other Party. Each Party’s initial Alliance Coordinator is indicated on
Exhibit C.

     2.9 Suspension of Santarus Information-Sharing Obligations. In the event that (i) Schering or
its Affiliate is actively engaged in developing, seeking Marketing Approval for or marketing a PPI
Pharmaceutical Product in or out of the Field in the Territory, (ii) Schering or its Affiliate
enters into a definitive agreement to have its OTC business acquired by an entity which is (or
whose Affiliate is) actively engaged in developing, seeking Marketing Approval for or marketing a
PPI Pharmaceutical Product in or out of the Field in the Territory, and/or (iii) Schering or its
Affiliate enters into a definitive agreement to acquire assets or rights related to a PPI
Pharmaceutical Product that is under active development, or for which Marketing Approval is being
sought, or which is marketed, in or out of the Field in the Territory, then in such event (whether
or not such activity or transaction violates Schering’s obligations under Section 4.6) Santarus’
obligations under this Agreement to disclose information through the JSC relating to its
Prescription Products bearing the Santarus Marks shall cease; provided, however, that if such
circumstance ceases (including without limitation by Schering’s divestiture of either the Licensed
Products or the other PPI Pharmaceutical Product(s) pursuant to Section 10.3), then Santarus’
obligations to disclose such information shall thereafter resume. It is understood that the
provisions of this Section 2.9 shall not be construed as limiting Schering’s obligations

12

 

under Section 4.6 or as a limitation or election of remedies by Santarus in connection with
any breach by Schering of Section 4.6.

ARTICLE 3

DEVELOPMENT AND COMMERCIALIZATION

     3.1 Product Development.

          3.1.1 Schering Responsibilities. Except as expressly stated otherwise in this Agreement,
Schering shall be responsible for conducting all development of Licensed Products in the Field and
Territory in accordance with the JSC-approved development plan, and shall bear all costs incurred
in conducting such development. Within [***] after the initial meeting with the FDA, Schering
will provide to the JSC, for review and approval, a development plan as described in Section
2.6.1(a) (a typical outline is provided at Exhibit E) and intended to be sufficient to
support Regulatory Filing for Marketing Approval of a Licensed Product in the United States in
accordance with the schedule in Section 3.7.2. Schering will regularly update (but in no event
less frequently than quarterly) the JSC with details of its progress and deviations from plan.
Development plans to support Marketing Approval of a Licensed Product in countries in the Territory
other than the United States and for subsequent Licensed Products will be similarly presented to
the JSC for approval pursuant to Section 2.6.1. Schering agrees to promptly make available to
Santarus, at Santarus’ request and expense, copies of all data and Regulatory Filings generated by
or for Schering or its Affiliates or Sublicensees in conducting clinical trials and related
development and manufacturing of Licensed Products, together with copies of such related reports,
analyses, summaries and other information and documents in Schering’s possession or Control that
are reasonably necessary for obtaining Marketing Approval of, or otherwise for the
commercialization and marketing of, the Prescription Products bearing the Santarus Marks in the
Territory. Schering and its Affiliates and Sublicensees shall neither conduct clinical trials of
Licensed Products intended to demonstrate efficacy of Licensed Products for, nor submit Regulatory
Filings seeking Marketing Approval of Licensed Products for, any Indication other than Licensed
Indications.

          3.1.2 Santarus Responsibilities. Santarus, acting through the JSC, agrees to use commercially
reasonable efforts to cooperate with Schering through information sharing regarding clinical trials
and related development activities for Licensed Products in the Field. Santarus acknowledges that
it remains solely responsible for satisfying its own obligations and commitments to Regulatory
Authorities in the Territory regarding Prescription Products. Promptly upon Schering’s request,
Santarus agrees to make available to Schering, at Schering’s expense, copies of all data and
Regulatory Filings generated by or for Santarus in conducting clinical trials and related
development and manufacturing of Prescription Products bearing the Santarus Marks for the
Territory, together with copies of such reports, analyses, summaries and other information and
documents in Santarus’ possession or Control, in each case that are reasonably necessary for
obtaining Marketing Approval in the Territory of the Licensed Product hereunder.

          3.1.3 Coordination of Products in Clinical Trials. On the request of either Party, the
Parties shall discuss in good faith the possibility of including Schering’s Licensed Products in
the clinical trials conducted by Santarus or Santarus’ Prescription Products in the clinical trials
conducted by Schering; provided, however, that nothing in this Section 3.1.3 shall be construed to
obligate either Party to include the Products of the other Party in its clinical trials.

          3.1.4 Licensed Product Family Expansion. Schering may expand the range of Licensed Products
it develops and commercializes in the Field in the Territory to include new

 

			
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Formulations of Licensed Products, as approved by the JSC (and subject to the applicable
deciding votes of Schering or Santarus).

          3.1.5 Reimbursement for Voluntary Assistance. The Parties acknowledge that each Party may,
from time to time on the request of the other Party, elect in its discretion to take actions or
undertake obligations that such Party is not otherwise obligated to undertake under this Agreement
in order to assist the requesting Party in connection with the development, manufacture, regulatory
approval, marketing or commercialization of Licensed Products in the Territory and/or corresponding
Prescription Products (which may include, by way of example and not limitation, if one Party, at
the request of the other, arranges for stability testing of Licensed Products (or similar or
identical Prescription Products) for use by the other Party). It is understood and agreed that in
such event, the Party requesting such action or undertaking shall reimburse the other Party for
out-of-pocket and other reasonable amounts (other than de minimus amounts) incurred in connection
therewith, within thirty (30) days of receipt of an invoice therefor. Each Party shall use good
faith efforts to apprise the other Party of the existence and estimated magnitude of such expenses
to be reimbursed by the other Party reasonably in advance of incurring them.

     3.2 Regulatory Matters.

          3.2.1 Schering Obligations. Subject to applicable JSC approvals and oversight as set forth in
Section 2.6 above, Schering shall have the sole responsibility, at its sole expense, and shall
satisfy its obligations and commitments to Regulatory Authorities for all regulatory matters
concerning Marketing Approvals for Licensed Products in the Field and Territory, including
Regulatory Filings, maintenance of Marketing Approvals in the Territory, and all regulatory-related
decisions concerning Licensed Products in the Field and Territory, consistent with the provisions
of this Agreement. Schering shall provide Santarus at least thirty (30) days advance notice (or,
if thirty (30) days advance notice is not possible, such advance notice as is possible under the
circumstances) of any meetings between Schering and the FDA relating to Schering’s manufacturing,
development, commercialization and/or marketing of Licensed Products, and allow up to two (2)
representatives of Santarus to attend any such meetings as observers. Schering shall provide to
Santarus copies of material correspondence received by Schering from Regulatory Authorities that
relates to the Licensed Products promptly (within ten (10) Business Days following Schering’s
receipt thereof), and Schering shall provide Santarus an opportunity to review and comment on the
Regulatory Filings and material correspondence with Regulatory Authorities in the Territory prior
to submission, and shall consider in good faith and incorporate the comments of Santarus in such
Regulatory Filings and correspondence to the extent reasonably acceptable to Schering. Unless the
Parties agree otherwise, any Regulatory Filings for Licensed Product in the Field and Territory
shall be in the name of Schering, and any resulting Marketing Approvals obtained by Schering shall
be owned by Schering.

          3.2.2 Inquiry Regarding Indication at First FDA Meeting. In its first substantive meeting
with FDA personnel regarding Licensed Products, and in its communications in advance of such
meeting, Schering (or its Affiliate or Sublicensee, as the case may be) shall inquire regarding the
approval of the Initial Product for not only the Initial Indication in the Field, but also shall
specifically inquire about approval of a label for [***] (the “Milestone Indication”), and shall
request a written response (in the form of meeting minutes or otherwise) regarding such matter.
[***]. For clarity, nothing in this Section 3.2.2 shall preclude Schering, in its discretion, from
raising and addressing in such meeting other matters regarding Licensed Products in the Field,
including without limitation, the possibility and likelihood of obtaining approval for any Licensed
Indication(s). It is understood and agreed that Schering intends to, and shall diligently endeavor
to, prepare and submit draft meeting minutes to the FDA promptly

 

			
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following such meeting and take such action as may be reasonable to facilitate or encourage
FDA’s prompt issuance of the meeting minutes.

          3.2.3 Mutual Obligations. Each Party shall provide the other Party with all available data
that is generated by or on behalf of such Party during the term of this Agreement that may
facilitate the other Party’s Regulatory Filings and Marketing Approvals concerning Licensed
Products under this Agreement or Prescription Products bearing the Santarus Marks in the Territory,
as the case may be, which data may include but is not limited to pre-clinical data, including
laboratory test data and animal test data, product development and manufacturing data and quality
records, including formulation and packaging development data and stability information and
clinical data, including clinical studies and protocols, regardless of whether such data are
submitted to a Regulatory Authority.

          3.2.4 Reference Rights. Each Party (the “Sponsoring Party”) hereby grants the other Party
(the “Referencing Party”) a right of reference to all data and information contained or referenced
in those sections of Regulatory Filings for the Sponsoring Party’s (and in the case of Schering,
its Affiliates’) Products in the Territory (Licensed Products in the case of Schering, and
Prescription Products bearing the Santarus Marks in the case of Santarus) that would be reasonably
necessary for the Referencing Party’s Regulatory Filings concerning Licensed Products for Licensed
Indications in the Field in the Territory (in the case of Schering as the Referencing Party) or
Prescription Products bearing the Santarus Marks in the Territory (in the case of Santarus as the
Referencing Party). The Sponsoring Party shall provide the applicable Regulatory Authority a
letter confirming this right of reference at any time within fifteen (15) days of the Referencing
Party’s request and shall take such other actions and execute such other documents as the
Referencing Party may reasonably request to further confirm and give effect to this right of
reference. Additionally, the Sponsoring Party agrees that the Referencing Party shall have the
right, subject to JSC approval, to add to the Sponsoring Party’s applicable Regulatory Filing in
the Territory protocols for clinical trials that may be required for Marketing Approval of (a) a
Licensed Product for Licensed Indications in the Field by a Regulatory Authority in the Territory,
in the case of Schering as the Referencing Party or (ii) a Prescription Product in the Territory,
in the case of Santarus as the Referencing Party.

          3.2.5 Information to JSC; Consultation. Schering shall keep the JSC informed on a quarterly
basis regarding regulatory matters relating to Licensed Products, including strategies and
progress. Through the JSC, the Parties shall consult with each other regarding regulatory matters
that could impact both Licensed Products in the Field and Prescription Products in the Territory,
and shall use commercially reasonable efforts to cooperate to resolve such matters, consistent with
the terms of this Agreement.

     3.3 Marketing and Sales.

          3.3.1 Marketing Obligations. Subject to the license restrictions in Sections 4.1 and 4.5.1,
Schering shall have the exclusive right, and sole responsibility, for marketing, distributing and
selling Licensed Products in the Field and Territory, at its sole expense, in accordance with the
marketing plan(s) approved by the JSC. Schering will seek to maximize market demand for Licensed
Products in the Field and Territory and to fulfill such demand, using efforts consistent with
Section 3.7 and other terms of this Agreement, including without limitation the marketing
commitment set forth in Section 3.3.3.

          3.3.2
Marketing Plans. Schering will prepare for the JSC’s review and approval an annual
marketing plan as set forth in Section 2.6.1(b) (a typical table of contents is provided at Exhibit
D), which shall include: (a) a description of strategy and positioning implementation, high level
message strategies, and key marketing issues for Licensed Products; (b) a reasonably
detailed budget and description of Schering’s planned promotion, marketing, product

15

 

positioning and messaging, sales and other key commercialization activities for Licensed
Products; (c) Licensed Product distribution strategy in the Field and Territory; and (d) the goals
and objectives for Licensed Product market share and sales (including a good faith forecast of its
projected sales of Licensed Products for the upcoming three (3) years) in the Field and Territory
(the “Schering Marketing Plan”). Schering will provide regular updates (but in no event less
frequently than quarterly) to the JSC detailing its progress and deviations from plan. Santarus
will prepare its Prescription Product plan providing a high-level overview of its marketing, sales
and other commercialization plans with respect to its Prescription Products bearing the Santarus
Marks, and which shall address promotion of such Prescription Products to professionals, overall
brand positioning, and description of strategy and positioning implementation and key marketing
issues with respect to such Prescription Products in the Territory (the “Santarus Marketing Plan”),
which will be provided by Santarus to the JSC for informational purposes only and will not be
subject to the JSC’s review and approval. No later than November 30th of each calendar year after
the Effective Date, each Party shall have submitted its respective Marketing Plan to the JSC, and
the JSC will have met to discuss them and to resolve any conflicts or inconsistencies between the
two Marketing Plans. It is understood that the responsibility of the JSC with respect to Marketing
Plans is intended to provide a coordinating role between the two Marketing Plans and seeking to
reach consensus between the Parties, with the objective of maximizing brand value for the Zegerid
family of products, while ensuring that such activities are complementary to, and consistent with,
Santarus’ activities with respect to Prescription Products in the Territory bearing the Santarus
Marks. However, the JSC shall not have authority to require either Party to conduct activities not
agreed by such Party or to expend money in excess of the amount stated in its respective Marketing
Plan.

          3.3.3 Marketing Commitment. During the twelve (12) month period commencing upon receipt of
Marketing Approval in the U.S. for the first Licensed Product, Schering’s Marketing Commitment in
the U.S. shall be no less than [***]. In addition, Schering’s Marketing Commitment in the
Territory during the subsequent twelve (12) month period shall be no less than an amount equal to
[***].

     3.4 Product Supply. Schering intends to source its supply of omeprazole and of Licensed
Products in finished form from the same sources as referenced by Santarus in its NDA for the
applicable Prescription Product. [***] will take place through the JSC; provided, however, that
the JSC shall have no authority to make decisions regarding a Party’s manufacture of Products. In
the event that Schering and Santarus use the same manufacturer or supplier with respect to Licensed
Products and Prescription Products, [***]. Nothing in this Agreement shall be construed as
conveying rights for one Party to use tooling or equipment purchased by the other Party for a
manufacturer or as requiring Santarus to share the cost of additional equipment or tooling
necessary for a manufacturer to meet increased capacity due to Schering’s use of the same
manufacturer as Santarus. In the event that Schering and Santarus use the same manufacturer(s) for
Licensed Products and Prescription Products (active pharmaceutical ingredient, bulk form and/or
finished product form), [***].

     3.5 Complaints. Schering shall be responsible for all processing of information related to
any complaint, including Adverse Events and Product Quality Complaints, related to Licensed Product
sold in the Field and Territory under the licenses granted in this Agreement. Schering shall
assume all Regulatory Authority reporting obligations under Marketing Approvals for its Licensed
Products associated with this Agreement, as
required by applicable regulations. Santarus shall remain responsible for all Regulatory
Authority reporting obligations for Marketing Approvals associated with its Prescription Products.
Prior to the launch of the first Licensed Product in the United States, Santarus and Schering shall
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written pharmacovigilance agreement specifying reasonable and
customary terms and conditions for exchange of safety and complaint information. Through that
agreement, each Party will agree to share with the other Party relevant information it receives
(either directly or indirectly) in a timely manner so as to allow each Party to comply with its
responsibility to process and report complaint information under this
Section 3.5 (including
reporting obligations to Regulatory Authorities). Each Party agrees to cooperate in the
investigation and resolution of alleged safety or Product Quality Complaints relevant to Licensed
Products and Prescription Products in the Territory. Each Party shall allow reasonable access to
its facilities, systems, personnel, and records, in whatever form and in any location (including
locations owned and operated by a Third Party), as reasonably necessary to enable each Party to
evaluate and ensure compliance with the Adverse Event reporting policies and procedures for the
Licensed Products and Prescription Products, as well as compliance with any applicable legal or
regulatory requirements applicable or relevant to the Licensed Products or Prescription Products.

     3.6 Recalls. If either Party intends to undertake a recall, correction, removal, field alert,
market withdrawal, or other similar notification to users of a Product in any country in the
Territory, that Party shall notify the other of its intention prior to taking action, so that such
other Party has sufficient opportunity, to the extent reasonably practicable under the
circumstances, to discuss and comment on such decisions. Each Party shall notify the other of
taking such action within twenty four (24) hours of commencement and shall provide the other Party
with a copy of all material related documents. It is understood that each Party shall be
responsible, in its discretion, for making decisions about recalls of such Party’s own products.

     3.7 Diligence.

          3.7.1 General Level of Effort. Schering shall use active, sustained, diligent efforts to
conduct and complete in a timely manner all activities required to: (i) develop Licensed Products;
(ii) receive Marketing Approval in the Territory for Licensed Products; and (iii) market, sell and
generate and meet market demand for Licensed Products in the Territory; which efforts all shall be
at least the same as its efforts for products with a similar maturity, market potential and
potential profitability (determined without taking into account payments under this Agreement).

          3.7.2 Diligence Milestones. Without limiting the generality of the foregoing, Schering shall
achieve each of the following milestones (each, a “Diligence Milestone”) on or before the
applicable date specified below (subject to any applicable extensions set forth in (a) or (b),
below):

	 	 	 	 	 
	 	 	Objective	 	Date
	 	 	 
	1.

	 	Formal request to FDA for initial meeting concerning Marketing
Approval for the Initial Product in the Field for the Milestone
Indication described in Section 3.2.2
	 	[***] after the Effective Date
	 
	 	 	 	 
	2.

	 	Submission to JSC of the development plan for the first Licensed
Product, as described in Section 3.1.1
	 	[***] after initial meeting with the FDA as requested above.
	 
	 	 	 	 
	3.

	 	Acceptance by the FDA of an NDA for the first Licensed Product
	 	later of [***] after the Effective Date
	 
	 	 	 	 
	4.

	 	First Commercial Sale of the first Licensed Product in the
Territory
	 	The earlier of: [***]

               (a) Extension of Diligence Milestone 3. In the event that Schering does not achieve Diligence
Milestone 3 on or before the date indicated above for such Diligence

 

			
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Milestone (or an extended
deadline therefor as set forth in this Section 3.7.2(a)), the time period for achieving such
Diligence Milestone shall be extended by [***] if (i) a JSC-approved development plan sets forth a
budget for development activities directed to obtaining Marketing Approval in the Territory for
Licensed Products for Licensed Indications in the Field (which activities may without limitation
include [***] and other clinical studies, if any, as may be required by the FDA), for at least the
[***] preceding such deadline and (ii) Schering demonstrates to Santarus that it has spent such
amounts for such purposes during such period (the “Milestone 3 Diligence Amount”). The time period
for achieving Diligence Milestone 3 may be extended for successive [***] periods if Schering has
expended the applicable Milestone 3 Diligence Amount directed to obtaining Marketing Approval in
the Territory for Licensed Products for Licensed Indications in the Field within the [***]
immediately preceding the expiration of the applicable deadline; provided, however, that the
deadline for Milestone 3 shall not be extended hereunder beyond [***].

               (b) Extension of Diligence Milestone 4. In the event [***], the deadline for achieving
Diligence Milestone 4 shall be extended by [***].

          3.7.3 Lack of Diligence.

               (a) Failure to Fulfill Obligation. In the event that Schering does not fulfill its diligence
obligations under this Section 3.7, Santarus shall have the right to terminate this Agreement
pursuant to Section 9.2; provided, however, that the thirty (30) day cure period described in
Section 9.2 shall not apply with respect to failure to meet the timeframes set forth in Section
3.7.2 above by the applicable deadline (including any applicable extension thereof under Section
3.7.2(a) or (b)). Additionally, Schering shall have a thirty (30) day cure period with respect to
failure to achieve Diligence Milestone 4 set forth above by the applicable deadline if such failure
is caused by circumstances out of Schering’s reasonable control, provided that, and for so long as,
Schering is using diligent, sustained and active efforts to cure such failure throughout such cure
period.

               (b) Decision Not to Pursue. In the event that Schering decides to not obtain Marketing
Approval for, or to not launch and commercialize, Licensed Products for Licensed Indications in the
Field in the Territory, Schering shall promptly notify Santarus of such decision in writing.
Nothing in this Section 3.7.3(b) shall be construed to prejudice Schering’s right to terminate this
Agreement pursuant to Section 9.3.

          3.7.4 Reporting. Without limiting the reporting and information-sharing obligations set forth
in this Agreement, the Parties acknowledge and agree that the various reports and information to be
provided by Schering to Santarus and/or the JSC under this Agreement shall be provided in
reasonable detail, sufficient to permit Santarus to determine Schering’s and its Affiliates’ and
Sublicenses’ compliance with the diligence requirements under this Section 3.7. Schering shall use
reasonable efforts to promptly provide additional information, as Santarus may from time to time
reasonably request, to permit Santarus to make such determination.

ARTICLE 4

LICENSES

     4.1 Patent and Know-How License to Schering.

          4.1.1 Patents and Know-How. Subject to the terms and conditions of this Agreement, Santarus
agrees to grant and hereby grants to Schering the following licenses, with the right to sublicense
(subject to the restrictions of Section 4.2), under the Santarus Patents and Santarus Know-How: (i)
an exclusive (even as to Santarus) license in the Territory to develop, import, use, sell and offer
for sale Licensed Products for Licensed Indications in the

 

			
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Field; and (ii) subject to Section
4.1.3, a non-exclusive worldwide license to develop, import, make and have made Licensed Products
solely for sale in the Territory in the Field, which license shall be exclusive, even as to
Santarus, regarding import and sale of Licensed Products in the Field in the Territory. Unless
otherwise approved by the JSC pursuant to Section 2.6 (and in accordance with Santarus’ deciding
vote as set forth in Section 2.6.4), it is understood that the scope of this license does not
extend to [***].

          4.1.2 Exclusivity for PPI Products. Santarus agrees that, during the term of the Agreement,
Santarus shall not, and shall not grant any license under the Santarus Patents, Santarus Know-How
or Product Marks to a Third Party to: (i) sell or offer for sale Products in the Field in the
Territory, or (ii) develop, make, have made, or import Products for sale in the Field in the
Territory.

          4.1.3 Retained Manufacturing Rights. For clarity, it is understood and agreed that,
notwithstanding the license to Schering set forth in Section 4.1.1 above and the provision of
Section 4.1.2, Santarus shall retain the right under the Santarus Patents and Know-How (but not the
Product Marks) to make and have made Licensed Products in the Territory for sale outside the
Territory, and to authorize others to do the same.

     4.2 Sublicenses.

          4.2.1 Affiliates. Schering shall have the right to exercise the licenses granted in Sections
4.1 and 4.5 through any one or more of its Affiliates, for as long as such entity remains an
Affiliate of Schering.

          4.2.2 Third Parties. Schering may sublicense the rights granted in Sections 4.1 and 4.5 to
Third Parties with Santarus’ prior written consent, such consent to be given in Santarus’
discretion. Each sublicense granted by Schering hereunder shall be consistent with the terms and
conditions of this Agreement. Schering shall promptly provide Santarus with a copy of the final
executed version of each such sublicense agreement, redacted as to financial terms between Schering
and such Sublicensee.

          4.2.3 Schering Responsibility. Schering hereby warrants and guarantees the performance of,
and compliance with, the obligations set forth in this Agreement by its Affiliates and
Sublicensees. Schering shall remain responsible for all other payments and other obligations under
this Agreement arising from activities of its Affiliates and Sublicensees.

          4.2.4 Survival. Upon termination of this Agreement: (i) sublicenses granted by Schering to
its Affiliates shall concurrently terminate; and (ii) each sublicense granted to Sublicensees shall
survive (unless otherwise provided in the applicable sublicense agreement between Schering and such
Sublicensee), provided that the
applicable Sublicensee agrees in writing to be bound by the payment and other obligations of
Schering pursuant to this Agreement.

     4.3 License to Santarus. Subject to the terms and conditions of this Agreement, Schering
agrees to grant and hereby grants to Santarus and its Affiliates a [***] (as described below in
this Section 4.3) license under the Schering Incorporated IP solely to: [***]. Nothing in this
Section 4.3 shall be construed to require Santarus to obtain Schering’s consent to enter into
agreements for co-promoting and/or co-marketing Prescription Products, or for the contract
development, contract manufacture or contract sales of Prescription Products on behalf of Santarus.
[***].

     4.4 Similarity of Products. The Parties acknowledge that the Formulations of one or more
Licensed Products may be similar or identical to corresponding Prescription Products in the
Territory and/or Products outside the Territory, and agree that: (i) the exclusive license

 

			
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19

 

granted
by Santarus pursuant to Section 4.1 shall not be construed to preclude Santarus (or its Affiliates
or licensees) from manufacturing, developing and/or commercializing Prescription Products in the
Territory or Products outside the Territory (including without limitation the manufacture of
non-Prescription Products in the Territory for use or sale outside the Territory) as long as such
Products and Prescription Products do not bear the Product Marks; and (ii) the exclusive license
granted by Schering pursuant to Section 4.3 shall not be construed to preclude Schering (or its
Affiliates or licensees) from manufacturing, developing and/or commercializing Licensed Products
pursuant to the license set forth in Section 4.1 (including without limitation the manufacture of
Licensed Products outside the Territory for use or sale in the Territory as licensed herein) or,
subject to Section 4.6, for exploiting the Schering Incorporated IP worldwide on products outside
the Field.

     4.5 Santarus Trademarks.

          4.5.1 License. Subject to the terms and conditions of this Agreement, Santarus hereby grants
Schering an exclusive license under the Product Marks (with the right to sublicense, subject to the
restrictions of Section 4.2, in conjunction with a permitted sublicense by Schering for Licensed
Products under this Agreement), during the term of this Agreement, to use the Product Marks for the
development, importation, marketing and promotion of Licensed Products for use and sale within the
Field in the Territory. For so long as Schering retains the exclusive license to the Product Marks
as set forth herein, Santarus shall not use, and shall not grant any Third Party a license to use,
the Product Marks worldwide; provided, however, the foregoing shall not be construed to restrict or
limit Santarus’ rights under, and right to license others under, the Santarus Marks with respect to
trademarks and other designations (and corresponding domain names) other than the Product Marks.
Schering shall not use the Product Marks in connection with the development, importation, marketing
or promotion of any pharmaceutical product other than Licensed Products in the Field in the
Territory. Unless otherwise approved by the JSC pursuant to Section 2.6 (and in accordance with
[***]), it is understood that the scope of this license does not extend to targeted promotion or
sale of Products in the Field to healthcare practitioners licensed to prescribe or the Managed Care
Market.

          4.5.2 Ownership. Santarus shall own all rights in and to the Santarus Marks and Product Marks
worldwide. Schering hereby acknowledges Santarus’ exclusive ownership rights in the Santarus
Marks and the Product Marks, and accordingly agrees that at no time during the term of this
Agreement will it challenge or assist others to challenge the Santarus Marks or the Product Marks,
or the registration
thereof, or attempt to register any trademarks, servicemarks or trade names confusingly
similar to the Santarus Marks or the Product Marks, or domain names based thereon. All goodwill
associated with the Santarus Marks and the Product Marks, and domain names based thereon, shall
accrue to Santarus.

          4.5.3 Display. Subject to Regulatory Authority approval, all packaging materials, labels and
promotional materials for Licensed Products sold in the Territory shall display one or more Product
Marks, and may display such Schering Marks as Schering may choose at its sole discretion; provided,
however, that the Product Mark shall be of at least equal size and prominence as the most prominent
textual Schering Mark. All Schering Marks shall be owned solely by Schering.

          4.5.4 Standards of Use. All representations of Product Marks that Schering intends to use
shall first be submitted to Santarus (through the JSC) for approval (which shall be provided on a
timely basis and shall not be unreasonably withheld) of design, color, and other details that
comply with Santarus’ applicable usage guidelines as established from time to time and communicated
to Schering. Schering shall submit representative packaging materials,

 

			
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20

 

labels and promotional
materials using any Product Mark, and significant modifications to previously submitted materials,
to Santarus (through the JSC) for timely review prior to their first use and shall provide updates
to the JSC at its regularly scheduled meetings. Schering shall not be obligated to change its use
and display of the Product Marks in response to a change in Santarus’ usage guidelines until
Schering has exhausted its existing stock of packaging materials, labels and promotional materials
that incorporate the Product Marks consistent with the prior version of the usage guidelines.

          4.6 Exclusive Arrangement. In order to encourage the development of the Licensed Products for
the OTC market, and to help protect the Santarus Know-How, the Parties agree to an exclusive
arrangement with respect to certain PPI Pharmaceutical Products as set forth in this Section 4.6.
In partial consideration for the rights and licenses granted herein and access to Santarus
Know-How, Schering covenants that, other than for Licensed Products pursuant to the licenses set
forth in this Agreement, neither it nor its Affiliates will, directly or indirectly:

(i) market, sell or develop for use in the Field and in the Territory during the term of this Agreement any PPI Pharmaceutical Product;

(ii) [***];

(iii) [***]; or

(iv) [***].

     4.7 No Santarus Patent Challenges. In partial consideration for the rights and licenses
granted herein and access to Santarus IP, Schering covenants that, during the term of this
Agreement, neither it nor its Affiliates will challenge, or cause to be challenged (which excludes
any Third Party challenges made as a counterclaim or other action brought by a Third Party in
response to a suit or threatened suit for infringement), in any way the validity, enforceability or
scope of the Santarus Patents (or foreign counterparts thereof anywhere in the world) in any court
or before any government or regulatory agency (national or international) with authority to
determine the validity, enforceability or scope of such Santarus Patents, or cause or request a
review by any such court or government or regulatory agency of the same.

     4.8 Know-How and Patent Restrictions. Schering, its Affiliates and Sublicensees shall not use
or practice (or authorize the use or practice of) the Santarus Know-How and/or the Santarus
Patents, for purposes of manufacturing, developing or commercializing any product other than
Licensed Products pursuant to the license set forth in Section 4.1 of this Agreement. Without
Santarus’ prior written consent, Schering shall not disclose to any of its Affiliates any
information directly related to the development, manufacture or commercialization of Licensed
Products hereunder or any Confidential Information of Santarus, other than (i) information
contained in publicly available filings with the Securities Exchange Commission and/or (ii)
materials obtained from (and in the format obtained from) a Third Party and generally made
available by such Third Party for purchase. It is understood that the foregoing does not prohibit
Schering from disclosing to its parent company its own Confidential Information regarding its
efforts to develop, commercialize and market Licensed Products in the Territory to the extent
necessary for corporate governance, compliance and auditing purposes, or to the extent necessary to
perform its global pharmacovigilance obligations or otherwise perform its obligations or exercise
its rights under this Agreement. It is also understood that, should Schering market Licensed
Products outside the United States but within the Territory through an Affiliate, then it shall be
permitted to disclose Santarus Confidential Information to such Affiliate to the extent necessary
to achieve Marketing Approval and sales of Licensed Products in the applicable country(ies).

 

			
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21

 

     4.9 [***]. Schering and its Affiliates and Sublicensees shall not market, sell or seek
Marketing Approval for any [***] in the Field and in the Territory, unless and until it (or its
Affiliate or Sublicensee) has obtained Marketing Approval for, and launched commercial sales of, a
Licensed Product that is not a [***] in the Field in the Territory.

     4.10 Notice Regarding Negotiations Outside the Territory. In the event that Santarus is
interested in conveying a license to Licensed Products (excluding the Product Marks) for use in the
Field in any one or more countries outside the Territory during the term of the Agreement and
prior to the [***], and has entered into (or in good faith intends to enter into) negotiations with
any Third Party with respect to such a license, Santarus shall give Schering written notice thereof
(a “Negotiation Notice”) for the purpose of allowing Schering to determine whether it wishes to
propose terms and negotiate with Santarus regarding an expansion of the license granted hereunder
to include such countries. In such Negotiation Notice, Santarus shall only be obligated to state
that Santarus is in discussions regarding a license for one or more Products for OTC use outside
the Territory and to identify the applicable country or countries. Santarus may provide such
Negotiation Notice at any time, and shall provide such Negotiation Notice no later than promptly
after negotiations with the applicable Third Party have reached term sheet stage. In the event
that Santarus has given a Negotiation Notice, Santarus shall not be required to give further or
additional Negotiation Notices for a period of [***] thereafter with respect to any country(ies)
covered in such Negotiation Notice, regardless of the number or identity of Third Parties with
which Santarus may negotiate. Nothing herein shall obligate either Party to enter into any
agreement regarding an expansion of the license set forth herein, or to accept or agree to any
terms therefor proposed by the other Party. Nothing in this Section 4.10 shall be construed to
restrict Santarus’ negotiations with any Third Party or prevent Santarus from entering into any
license with any Third Party. Negotiation Notices shall be deemed Confidential Information of
Santarus, and may be disclosed by Schering to its Affiliates on a confidential basis (without
breaching Section 4.8) for the sole purpose of evaluating Schering’s and its Affiliates’ interest
in an expansion of the license granted hereunder to include such countries. Santarus’ obligation
to provide Negotiation Notices
under this Section 4.10 with respect to any given country shall terminate, on a
country-by-country basis, at such time, if any, as Schering or its Affiliate markets, or seeks
Marketing Approval for, a PPI Pharmaceutical Product in such country, or acquires rights therefor
from a Third Party.

     4.11 Certain Provisions Regarding Rights Sublicensed Under Missouri Agreement.

          4.11.1 Payments to Missouri. Santarus shall have the obligation to pay all amounts owed to
the Curators of the University of Missouri under the Missouri Agreement, and in accordance with the
terms set forth therein, with respect to sales of Licensed Products by Schering and its Affiliates
and Sublicensees pursuant to the license set forth in this Agreement.

          4.11.2 Terms of Missouri Agreement. It is understood and agreed that the sublicense to
Schering under this Agreement of rights licensed to Santarus under the Missouri Agreement is
subject to applicable terms and conditions of the Missouri Agreement, and that such obligations are
incorporated by reference herein.

          4.11.3 Assignment in Event of Termination. In the event that during the term of this
Agreement Santarus’ rights under the Missouri Agreement are terminated prior to expiration of the
Missouri Agreement with respect to sales of Licensed Products in the Territory, (i) the sublicense
of the “Patent Rights,” as defined in the Missouri Agreement (hereinafter referred to as the
“Missouri Patent Rights”) that is conveyed to Schering hereunder shall be assigned by Santarus to
the Curators of the University of Missouri, including without limitation the grant of licenses and
rights in this Agreement to Schering under the Missouri Patents and payments by Schering of amounts
owed under the Missouri Agreement for sales of Licensed Products by

 

			
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22

 

Schering, and this Agreement
will be assigned in part to the Curators of the University of Missouri to effect such assignment of
the sublicense, (ii) this Agreement shall otherwise be retained by Santarus with respect to all
matters other than the sublicense of the Missouri Patent Rights, and (iii) Schering shall
thereafter be responsible for making all payments owed to the Curators of the University of
Missouri in respect of its sublicense under the Missouri Patents for sales of Licensed Products in
the Field and Territory by Schering after the date of such assignment.

ARTICLE 5

PAYMENTS; ROYALTIES, REPORTS

     5.1 Up-Front Payment. Within two (2) business days after the Effective Date, Schering shall
pay Santarus an up-front license fee of fifteen million dollars (US$15,000,000), which amount shall
be non-refundable and non-creditable against other amounts due to Santarus.

     5.2 Milestone Payments. In partial consideration for the licenses and rights granted to
Schering hereunder, Schering shall pay Santarus the following amounts (each, a “Milestone Payment”)
within thirty (30) days (or such time as may apply with respect to Milestones 4 through 7 as set
forth in proviso (7), below) following the first achievement by Schering, its Affiliates and/or
Sublicensee(s), as the case may be, of each of the following milestones (“Milestones”):

	 	 	 	 	 
	 	 	Milestone	 	Amount
	 	 	 
	1.

	 	[***]
	 	US$[***]
	 
	 	 	 	 
	2.

	 	[***]
	 	US$[***]
	 
	 	 	 	 
	3.

	 	[***]
	 	US$[***]
	 
	 	 	 	 
	4.

	 	First time in which annual Net Sales of
Licensed Products in the Territory reach or exceed at
least US$ [***]
	 	US$[***]
	 
	 	 	 	 
	5.

	 	First time in which annual Net Sales of
Licensed Products in the Territory reach or exceed at
least US$ [***]
	 	US$[***]
	 
	 	 	 	 
	6.

	 	First time in which annual Net Sales of
Licensed Products in the Territory reach or exceed at
least US$ [***]
	 	US$[***]
	 
	 	 	 	 
	7.

	 	First time in which annual Net Sales of
Licensed Products in the Territory reach or exceed at
least US$ [***]
	 	US$[***]

provided that:

	(1)	 	each such Milestone Payment shall be made only one time, regardless of how many times such
Milestone is achieved thereafter;
	 
	(2)	 	Schering shall promptly notify Santarus of the occurrence of each Milestone;
	 
	(3)	 	except as otherwise provided in Section 5.2.1 below, payment shall not be owed for a
Milestone which is not reached;
	 
	(4)	 	each such payment shall be non-refundable and non-creditable against other amounts due to
Santarus;
	 
	(5)	 	With respect to Milestone 1, above, in the event that:

     (a) [***], and/or

 

			
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23

 

     (b) [***]

	 	 	then, in each case, [***] shall not trigger payment of the milestone amount set forth for
Milestone 1; provided, however, that [***], then the amount set forth for Milestone 1, if
not previously paid, shall then become due;
	 
	(6)	 	[***]; and
	 
	(7)	 	Annual Net Sales shall be measured on a calendar year basis; provided, however, that, if the
Annual Net Sales amounts set forth for each of Milestones 4 through 7 are achieved prior to
the fourth calendar quarter of the applicable calendar year, then the corresponding milestone
amounts shall be due following the applicable calendar quarter in which such Annual Net Sales
are achieved. For purposes of example only, in the event that the annual Net Sales exceed
$[***] for the first time during the third calendar quarter of a given calendar year, the
corresponding milestone amount of $[***] would be due following the end of such calendar
quarter. Payments for Milestones 4 through 7 shall be made thirty (30) days following the end
of the applicable calendar quarter in which such Annual Net Sales are achieved.

          5.2.1 Skipped Milestones. If Schering [***], then the amount payable for Milestone 1 above,
if not previously paid, shall become due upon such [***]. In the event that more than one of
Milestones 4, 5, 6 and/or 7 are first achieved with respect to
Net Sales of Licensed Products during the same calendar quarter, then the amounts set forth
above for each such Milestone shall become due at the same time. For purposes of example only, if
annual Net Sales of Licensed Products in the Territory during a given calendar year first exceeds
both $[***] and $[***] based on the net sales during the same calendar quarter, then both the
amount for Milestone 4 and the amount for Milestone 5 shall become due following that quarter.

     5.3 Royalties.

          5.3.1 Royalty Payments. In partial consideration of the license and rights granted under the
Santarus IP, Schering shall pay Santarus a royalty of [***] percent ([***]%) of Net Sales of
Licensed Products in the Territory by Schering and its Affiliates or Sublicensees, subject to any
adjustments made pursuant to Sections 5.4 and 5.5. The obligation of Schering to pay royalties
under this Section 5.3 shall continue for so long as Schering and its Affiliates and Sublicensees
sell Licensed Products in the Territory. Royalties will be paid with respect to Net Sales made in
each calendar quarter thirty (30) days following the applicable calendar quarter end.

          5.3.2 Convenience. Schering acknowledges that Santarus may not own or control patents
covering the development, manufacture, use or commercialization of Licensed Products throughout the
Territory and/or throughout the term of this Agreement, and agrees that in addition to the license
under the Santarus Patents granted to Schering pursuant to Section 4.1, substantial commercial
value has been and will be contributed by the license under Santarus Know-How granted to Schering
in Section 4.1 and the marketing and branding of Licensed Products in connection with Product Marks
derived from the Santarus Marks used for Santarus’ (or its Affiliates’ or licensees’) Products.
For their mutual convenience, the Parties have agreed to the royalty rates and payment obligations
set forth in this Section 5.3 with respect to Net Sales of Licensed Products in the Territory,
regardless of whether the development, manufacture, use or commercialization of such Licensed
Products is covered by patents owned or Controlled by Santarus.

 

			
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     5.4 Royalty Adjustments.

          5.4.1 Increase. Subject to any adjustments made to the royalty rate pursuant to Sections
5.4.2 and 5.4.3 below, in the event that Net Sales of Licensed Products exceed [***] dollars
(US$[***]) in any given calendar year, then the royalty rate to be paid by Schering with respect to
Net Sales of Licensed Products made during each such calendar year shall increase to [***] percent
([***]%). Any increase described herein shall be determined based on Net Sales in each given
calendar year and shall apply with respect to all Net Sales in such calendar year, and may be
applied in multiple years (should Net Sales in any such year exceed that US$[***] level). Within
thirty (30) days after the end of each calendar quarter, Schering shall determine in good faith if
Net Sales for the portion of the applicable calendar year up to and including the applicable
calendar quarter exceeds [***] dollars (US$[***]) such that this royalty rate increase is
applicable for such calendar year, and, if so, shall pay Santarus the differential royalty amount
for Net Sales in such calendar quarter and each preceding calendar quarter in such calendar year at
that time, and shall thereafter pay royalties of [***] percent ([***]%) of Net Sales for subsequent
calendar quarters in such calendar year, if any.

          5.4.2 [***].

          5.4.3 Reduction for Market Competition. In the event that, and for so long as, (i) there is
no Valid Claim within the Santarus Patents and covering the
manufacture, use or sale of a given Licensed Product in a given country in the Territory, and
(ii) there exists Market Competition in such country, the royalty rates payable under Sections
5.3.1 and Section 5.4.1 shall be reduced from [***] percent ([***]%) or [***] percent ([***]%),
respectively, to [***] percent ([***]%) with respect to Net Sales of such Licensed Product in such
country. Notwithstanding the foregoing, the reduction set forth in this Section 5.4.3 shall not
apply with respect to Net Sales of Licensed Products in the Territory for which Santarus’ royalty
obligation under Section 4.5.1 of the Missouri Agreement remains in force. As used herein, “Market
Competition” shall mean a circumstance where any one or more Third Parties have received Marketing
Approval for, and are conducting bona fide on-going commercial sales of, Products in the Field in
such country.

     5.5 Combination Products. In the event that the JSC approves the development, manufacture
and/or sale of any Combination Product as set forth in Section 2.6, the calculation of Net Sales of
such Combination Product by Schering and its Affiliates and Sublicensees will be adjusted for
purposes of determining royalties payable hereunder in such manner as the JSC may agree in good
faith negotiations.

     5.6 Withholding. All payments due Santarus from Schering hereunder shall be made without
deduction for any withholding taxes, or similar governmental charge.

     5.7 Method of Payments. All amounts payable to Santarus under this Agreement shall be payable
in U.S. Dollars by wire transfer to a bank account it designates. In the case of royalties on Net
Sales, all amounts payable shall first be calculated in the currency of sale and then converted
into U.S. Dollars at the official rate of exchange of the currency of the country from which such
royalties are payable as quoted by the Wall Street Journal, New York Edition, for the last day of
the calendar quarter for which such royalties are due. All payments under this Agreement shall
bear interest from the date due until paid at a rate equal to [***], as quoted by the Wall Street
Journal, New York Edition, on the date such payment was due, or, if less, the maximum rate
permitted by applicable law.

     5.8 Royalty Reports and Payments. After the First Commercial Sale by Schering or its
Affiliates or Sublicensees of the first Licensed Product in the Field for which royalties are
payable hereunder, Schering shall make quarterly written reports to Santarus stating in each

 

			
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25

 

such
report, separately for Schering and each of its Affiliates and Sublicensees, and by country: (i)
the number, description and aggregate gross and Net Sales of each Licensed Product sold in the
Field during the immediately preceding quarter, including reasonably detailed descriptions of all
itemized deductions from gross sales; (ii) any reconciliation adjustments for amounts reported in
the monthly interim reports for such quarter; (iii) the calculated amount of royalties due Santarus
on account of such Net Sales; and (iv) the basis for calculation of royalties due Santarus,
including applicable deductions/adjustments, together with the exchange rates used for conversion
and the royalty due to Santarus thereon. Schering shall also make monthly interim written reports
to Santarus stating in each such report, separately for Schering and each of its Affiliates and
Sublicensees, and by country, the aggregate Net Sales of Licensed Products sold in the Field during
the immediately preceding month. If no royalties are due for a particular quarter or month,
Schering shall so report to Santarus. Schering’s quarterly reports under this Section 5.8 for each
calendar quarter shall be transmitted to Santarus by express mail or express delivery service, and
by email (to [***] and [***], or to such other e-mail address(es) as Santarus may from time to time
designate in writing), within thirty (30) days after the end of such calendar quarter. Monthly
interim reports under this Section 5.8 for each calendar month shall be
transmitted to Santarus by email (to [***] and [***], or to such other e-mail address(es) as
Santarus may from time to time designate in writing) within ten (10) days after the end of such
calendar month, and upon request of Santarus shall also be transmitted to Santarus in hardcopy by
express mail or express delivery service promptly following such request. All reports required by
this Section 5.8 shall be marked “CONFIDENTIAL” by Schering and shall be treated by Santarus as the
Confidential Information of Schering, subject to the terms and conditions of Article 8.

     5.9 Audits. Schering shall keep, and cause its Affiliates and Sublicensees to keep, complete
and accurate records in sufficient detail to enable (i) a determination of whether Schering (or its
Affiliates or Sublicensees) are complying with their spending and other financial obligations under
this Agreement and (ii) a calculation of royalties due Santarus on account of Net Sales of Licensed
Products in the Field and Territory, determined in accordance with Generally Accepted Accounting
Principles (including setting forth gross sales of each Licensed Product, Net Sales of each
Licensed Product, reasonably detailed descriptions of all itemized deductions from gross sales
taken to calculate Net Sales and amounts payable hereunder to Santarus for each such Licensed
Product). For the sole purpose of verifying amounts relating to this Agreement, Santarus shall
have the right no more than one time each calendar year, at its own expense, to have independent
auditors reasonably acceptable to Schering review such records for the preceding [***] calendar
years in the location(s) where such records are maintained by Schering and its Affiliates upon
reasonable notice and during regular business hours. Results of such review shall be made
available to Schering. The records and results of such audits shall be deemed Confidential
Information of Schering. In the event that such a review identifies an underpayment greater than
[***] percent ([***]%) of the amounts that were otherwise due for a calendar year during such
period, Santarus shall have the right to conduct a similar review of the records for up to an
additional [***] year period for the [***] calendar years immediately preceding the initial review
period. In any event, the total review period for such a review will not exceed [***] calendar
years. Further, if the review reflects an underpayment to Santarus, such underpayment shall be
promptly remitted to Santarus, together with interest calculated in the manner provided in Section
5.7. If the review reflects an overpayment to Santarus, such overpayment shall be credited against
the next payment due Santarus. If the underpayment is greater than [***] percent ([***]%) of the
amount that was otherwise due for a calendar year in such period, Schering shall reimburse Santarus
for the costs of such review.

 

			
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ARTICLE 6

INTELLECTUAL PROPERTY RIGHTS

     6.1 Inventions. With respect to inventions and intellectual property arising during the
course of, or as a result of, each Party’s performance under this Agreement, (i) title to all
inventions and intellectual property made by Schering employees or its agents hereunder (each a
“Schering Invention”) shall be solely owned by Schering, (ii) title to all inventions and
intellectual property made by Santarus employees or its agents hereunder (each a “Santarus
Invention”) shall be solely owned by Santarus, and (iii) title to all inventions and intellectual
property made by jointly by Schering employees or agents and Santarus employees or agents shall be
jointly owned. Inventorship of inventions shall be determined in accordance with the laws of
inventorship of the United States.

     6.2 Patent Coordination. Without limiting the provisions of this Article 6, the Parties agree
to confer from time to time, as either Party may reasonably request, to
discuss appropriate activities and strategies for protecting and enforcing their respective
patents and other intellectual property licensed hereunder, as may mutually benefit both Parties.
The JSC may create a subcommittee for the purpose of facilitating such discussions. Schering shall
keep Santarus reasonably and timely informed regarding patent applications within the Schering
Patents related to Licensed Products or Prescription Products, or their use, that are being
prosecuted in countries within and outside the Territory. Santarus shall have the right to advise
and comment upon the prosecution of patent applications for such Schering Patents in the Territory
to the extent related to Licensed Products or Prescription Products, and Schering agrees to
consider in good faith and incorporate such advice and comments of Santarus to the extent
reasonably acceptable to Schering.

     6.3 Santarus Patents.

          6.3.1 Prosecution. As between the Parties, Santarus shall remain the sole owner of the
Santarus Patents and Santarus Know-How. Santarus shall remain responsible, in its discretion, for
preparing, filing, prosecuting, handling any interferences, re-examinations or reissues, and
otherwise maintaining, the Santarus Patents (“Patent Activities”) during the term of this
Agreement. Santarus shall keep Schering reasonably and timely informed regarding patent
applications within the Santarus Patents related to Licensed Products, or their use, that are being
prosecuted in countries within the Territory, and Santarus shall make available to Schering (or its
designated counsel) copies of such patent application files and shall make available to Schering
(or its designated counsel) all office actions relating to those patent applications, and copies of
material correspondence with the various patent offices in the Territory relating to the Santarus
Patents to the extent they relate to any Licensed Products. Schering shall have the right to
advise and comment upon the prosecution of patent applications within the Santarus Patents.
Santarus shall, in good faith, consider and incorporate such advice and comments of Schering to the
extent reasonably acceptable to Santarus.

     6.3.2 [***]. Except as otherwise provided in the following sentence with respect to the
patent applications indicated as “[***]” on Exhibit B and patents issuing thereon (such patent
applications and patents referred to as “[***]”), Schering shall reimburse Santarus for [***]
percent ([***]%) of Santarus’ costs and fees involved in Patent Activities (“Patent Costs”) for the
Santarus Patents in the Territory during the term of this Agreement within thirty (30) days
following receipt of an invoice therefor, unless otherwise agreed to by the Parties in writing.
Notwithstanding the preceding sentence, Schering shall not be required to reimburse Santarus for
Patent Costs to the extent attributable to [***] unless and until such time as the JSC (or the
Parties) approve Schering’s development or commercialization of [***] covered by one or more claims
of one or more such [***], in which event Schering shall (i) reimburse Santarus for [***]

 

			
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percent
([***]%) of Patent Costs incurred after such approval that are attributable to Patent Activities
for the applicable [***] in the Territory, and (ii) reimburse Santarus for [***] percent ([***]%)
of Santarus’ past Patent Costs incurred after the Effective Date that are attributable to Patent
Activities for the applicable [***] in the Territory, within thirty (30) days following receipt of
an invoice therefor.

          6.3.3 Third Party Allocation. If Santarus grants a license under any one or more Santarus
Patents to any Third Party during the term of this Agreement and is entitled to additional
reimbursement of Patent Costs from such Third Party, then the Parties shall discuss in good faith a
reasonable and equitable allocation between the
Parties of Patent Costs incurred in connection with such Santarus Patents following the
effective date of such license.

          6.3.4 Additional Filings. Upon request of Schering, the Parties shall discuss in good faith
the filing of any continuation, continuation-in-part, or divisional to any patent or patent
application within the Santarus Patents to be filed in the Territory beyond those Santarus may
elect to file, which continuation, continuation-in-part or divisional relates to the Licensed
Products and/or their use. Together with such discussions, the Parties shall discuss in good faith
and agree on a reasonable and appropriate allocation of Patent Costs in connection with such
application (and any patent issuing thereon).

          6.3.5 Missouri Agreement. Santarus shall take all commercially reasonable actions necessary
to remain in good standing under the Missouri Agreement and to maintain it in full force and effect
during the term of this Agreement.

     6.4 Enforcement of Santarus Patents.

          6.4.1 In-Licensed Patents. It is understood and agreed that, with respect to patents and
patent applications within the Santarus Patents that are owned by a Third Party and licensed to
Santarus, the provisions set forth in this Section 6.4 (and the provisions of Section 6.3 above)
shall apply only to the extent consistent with Santarus’ obligations under the applicable
in-license for such Santarus Patents.

          6.4.2 General Enforcement. Each Party shall promptly notify the other in writing of any
actual or suspected infringement of any Santarus Patents in the Territory (including via
unauthorized importation into the Territory for sale in the Territory) or upon receiving
notification that a Santarus Patent is subject to a declaratory judgment action alleging
non-infringement, invalidity or unenforceability, which notification shall specify in reasonable
detail the nature of such actual or suspected infringement or judicial action. Schering shall not
give notice of infringement of the Santarus Patents to any Third Party other than a consultant or
advisor under contract to Schering (and bound by reasonable obligations of confidentiality) without
Santarus’ consent; provided, however, that Schering may give such notice to a Third Party, without
Santarus’ consent but upon thirty (30) days prior written notice to Santarus (or, if shorter, as
much advance written notice is as is reasonably practicable), if: (a) Santarus has declined to take
steps to abate such infringement and Schering has the right to enforce the Santarus Patents against
such Third Party infringer as set forth in this Section 6.4.2; or (b) disclosure is required by
securities or other laws to which Schering is subject; or (c) disclosure is made in the course of a
financial audit. Unless the Parties otherwise mutually agree, Santarus shall have the initial
right, using counsel of its choice, to enforce the Santarus Patents or defend any declaratory
action with respect thereto, at its expense, and Schering shall give all reasonable assistance
(excluding financial assistance) to Santarus in such action, at Santarus’ expense. However, if,
(A) within [***] days following a written request by Schering to do so and confirmation of facts
reasonably supporting existence of such actual or suspected infringement, Santarus fails to bring
an infringement suit or take other commercially reasonable action to protect the Santarus Patents
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in Santarus’ discretion include,
without limitation, negotiations for a license (not in conflict with the licenses granted Schering
herein) from Santarus for the manufacture, use or sale of Prescription Products or Products to be
sold outside the Territory) and/or (B) Santarus elects not to defend, or continue defending, a
declaratory judgment action regarding the Santarus Patents, in each case arising from an
infringement or threatened
infringement with respect to Licensed Products in the Field and Territory, then Schering shall
have the right, at its sole discretion, to institute such suit or take other appropriate action in
the name of either itself or both Parties using counsel of its choice, at its own expense, and with
the right to control the course of such action (and Santarus shall provide all reasonable
assistance, other than financial, to Schering for such action, at Schering’s expense, including
joining such action if necessary to maintain such action, and Santarus shall have the right to join
and participate in such action whether or not such joinder is requested by Schering).

          6.4.3 Recovery. In the event that either Party recovers any amounts from any litigation or
settlement pursuant to Section 6.4.2 or 6.4.5, such amounts shall first be applied to reimburse the
Parties for their respective actual out-of-pocket expenses, or equitable proportions thereof. Of
any remaining amounts, the amount (if any) which is required to be paid to the Curators of the
University of Missouri under the terms of the Missouri Agreement licensing such Santarus Patents to
Santarus shall then be paid to the University of Missouri, and any amounts remaining thereafter
shall (i) to the extent attributable to infringement of the Santarus Patents in the Field in the
Territory, be distributed [***] percent ([***]%) to the Party initiating and leading such action
and [***] percent ([***]%) to the other Party, or as the Parties may otherwise agree in writing,
and (ii) to the extent not attributable to infringement of the Santarus Patents in the Field in the
Territory, be distributed to (or retained by) Santarus.

          6.4.4 Limits on Disposition. In no case may Schering enter into any settlement or consent
judgment or other voluntary final disposition that: (i) extends, or purports to exercise,
Schering’s rights under the Santarus IP beyond the rights granted pursuant to this Agreement, (ii)
makes any admission regarding wrongdoing by Santarus or the Curators of the University of Missouri,
or the invalidity, unenforceability or absence of infringement of any Santarus Patents; (iii)
subjects Santarus to an injunction or other equitable relief; or (iv) obligates Santarus to make a
monetary payment; in all cases without the prior written consent of Santarus, which consent shall
not be unreasonably withheld or delayed. Similarly, in no case may Santarus enter into any
settlement or consent judgment or other voluntary final disposition that: (a) limits Schering’s
rights under the Santarus IP or under this Agreement other than as expressly stated herein; (b)
makes any admission regarding wrongdoing on the part of Schering, an Affiliate or Sublicensee, or
the invalidity, unenforceability or absence of infringement of any Schering Incorporated IP; (c)
subjects Schering to an injunction or other equitable relief; (d) obligates Schering to make a
monetary payment; or (e) extends, or purports to exercise, Santarus’ rights under the Schering
Incorporated IP beyond the rights granted pursuant to this Agreement; in all cases without the
prior written consent of Schering, which consent shall not be unreasonably withheld or delayed.

          6.4.5 Hatch-Waxman Notice. Notwithstanding the provisions of Section 6.4.2, in the event of a
notice received by Santarus or Schering under Paragraph IV of the Hatch-Waxman Act with respect to
a Licensed Product in the Field, (i) the receiving Party shall promptly provide the other Party
with notice of such Paragraph IV notice, (ii) Santarus shall have the initial right to institute an
action for infringement in connection with such Paragraph IV notice at Santarus’ expense and shall
provide Schering with notice of whether it intends to institute such infringement suit within [***]
days of receipt of the Paragraph IV notice and (ii) if Santarus provides notice to Schering in such
period that Santarus will not institute an infringement suit or provides no notice in such period,
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institute an infringement suit in such matter at Schering’s
expense. In any such proceeding, the provisions set
forth in Sections 6.4.2 and 6.4.3 above with respect to cooperation and allocation of
recoveries shall apply, and the provisions of Section 6.4.4 shall also apply.

          6.4.6 Defensive. If the manufacture, sale or use of a Licensed Product in the Field pursuant
to this Agreement results in any claim, suit or proceeding in the Territory alleging patent
infringement against Schering, then Section 6.4.4 shall apply to Schering’s ability to enter into
any settlement or consent judgment or other voluntary final disposition with respect thereto.

          6.4.7 Litigation Activities Update. The Parties shall keep one another reasonably informed of
the status of, and of their respective activities regarding, any litigation or settlement thereof
concerning Licensed Products in the Field or the Santarus Patents.

     6.5 Marks. Santarus shall use commercially reasonable efforts to file and maintain trademark
applications for Santarus Marks in the Territory during the term of this Agreement. Santarus shall
use reasonable efforts to file and maintain trademark applications for the Product Marks in the
Territory during the term of this Agreement, and will file new trademark applications in the
Territory that incorporate the Product Marks upon the reasonable request of Schering, including
filing trademark applications for use with Licensed Products in the Field in countries in the
Territory other than the United States. Schering agrees to pay all reasonable costs and expenses
associated with filing and maintaining such trademark registrations, including oppositions and
other related proceedings. In the event that Schering elects not to use any one or more specific
Product Marks, Schering may give Santarus ninety (90) days prior written notice thereof, and shall
not be obligated to pay costs and expenses related to such specific Product Mark thereafter, and
shall have no right to use such specific Product Mark. Santarus may, in its discretion, elect to
proceed or continue with filing and/or maintaining trademark registrations for such specific
Product Mark, at Santarus’ expense.

     6.6 Enforcement of Product Marks. In the event either Party becomes aware of any actual or
threatened infringement or misappropriation of a Product Mark by a Third Party in the Field in the
Territory, such Party shall promptly notify the other Party, and the Parties shall consult with
each other in good faith to determine jointly the best way to prevent such infringement, including,
without limitation, by instituting legal proceedings against such Third Party. Santarus shall have
the first right, but not obligation, at its own expense, to enforce rights in the Product Marks
against any Third Party infringer or alleged infringer. In the event that Santarus does not elect
to undertake such enforcement within [***] days following a written request by Schering to do so
and confirmation of facts reasonably supporting existence of such actual or threatened infringement
or misappropriation, then Schering shall have the right to undertake and control such enforcement
of the Product Mark in the Field in the Territory, including selecting counsel, at Schering’s own
expense. If either Party so desires, it may, at its own expense, join an action instituted by the
other Party (though Schering may only join an action in connection with actual or threatened
infringement or misappropriation of the Product Mark by a Third Party in the Field in the
Territory), and the other Party shall not oppose any such attempt. Any and all amounts recovered
with respect to such an action shall be applied first to reimburse the Parties for their
out-of-pocket expenses (including attorneys’ fees) in prosecuting such infringement or
misappropriation, or equitable portions thereof. The remainder shall be divided between the
Parties with [***] percent ([***]%) to the Party paying for such action and [***] percent ([***]%)
to the other Party. The Parties shall keep one another reasonably informed of the status of, and
of their respective activities regarding, any litigation or
settlement thereof concerning Product Marks in the Territory. Either Party’s ability to enter
into a settlement or consent judgment or other voluntary final disposition of such matter shall be
limited in the same manner as under Section 6.4.4.

 

			
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     6.7 Common Interest Agreement. The Parties may agree to enter into one or more mutually
agreed common interest agreements in order to further their common legal and business interests
with respect to proceedings and matters referred to in this Article 6, and/or with respect to
proceedings and matters for which one Party indemnifies the other pursuant to Article 7, while
protecting to the extent permitted by law the attorney-client privilege, attorney work product
protections, and other privileges and protections with respect to information and materials they
may exchange.

ARTICLE 7

REPRESENTATIONS AND WARRANTIES; INDEMNIFICATION

     7.1 Warranties.

          7.1.1 Santarus. Santarus warrants and represents to Schering that:

               (i) the execution, delivery and performance of this Agreement have been duly authorized by all
corporate action necessary on its part;

               (ii) as of the Effective Date, and except as otherwise disclosed to Schering (including
without limitation as otherwise indicated in Exhibit B attached hereto or as provided in the
Missouri Agreement), or as otherwise disclosed in Santarus’ filings with the Securities Exchange
Commission, it is the sole and exclusive owner or exclusive licensee of the entire right, title and
interest in and to each of the Santarus Patents, Santarus Marks and all of the Santarus Know-How
free and clear of any liens, charges, claims and encumbrances and has the right to grant rights
therein to Schering in the Territory;

               (iii) as of the Effective Date, there are no existing or, to the knowledge of Santarus
threatened, litigation actions, suits or claims pending against it before any court or governmental
agency or other tribunal with respect to the Santarus IP in the Territory or its right to enter
into and perform its obligations under this Agreement, in each case other than as disclosed in
Santarus’ filings with the Securities Exchange Commission (which filings exclude the “Risk Factors”
section except for specific events that have actually occurred and are disclosed in that section);

               (iv) as of the Effective Date, there are no oppositions or interferences concerning the
Santarus Patents or Santarus Marks in the Territory pending before any governmental agency or other
tribunal, in each case other than as disclosed in Santarus’ filings with the Securities Exchange
Commission (which filings exclude the “Risk Factors” section except for specific events that have
actually occurred and are disclosed in that section);

               (v) as of the Effective Date, (to the knowledge of Santarus with respect to in-licensed
intellectual property) all maintenance fees and annual payments due for the Santarus Patents and
Santarus Marks in the Territory have been paid;

               (vi) as of the Effective Date, except as otherwise disclosed in Santarus’ filings with the
Securities Exchange Commission (which filings exclude the “Risk Factors” section except for
specific events that have actually occurred and are disclosed in that section), it has not granted
any right, license or interest in, or to, the Santarus IP that is in conflict with the rights or
licenses granted under this Agreement;

               (vii) as of the Effective Date, the execution, delivery and performance of this Agreement
by Santarus does not conflict with any agreement, instrument or understanding, oral or written, to
which it is a party or by which it is bound, and Santarus will not enter into any such

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agreement or arrangement during the term of this Agreement which would conflict with Santarus’
performance and obligations hereunder, and

               (viii) as of the Effective Date, it has not omitted to furnish Schering with any information
requested by Schering, nor intentionally concealed from Schering, any information in its possession
relating to safety data, adverse events or the prescription drug information for Prescription
Products that contain omeprazole and no other PPI, as and to the extent the foregoing relates to
Licensed Products and would be material to Schering’s decision to enter into this Agreement and to
undertake the commitments and obligations set forth herein.

          7.1.2 Schering. Schering warrants and represents to Santarus that: (i) it has the full right
and authority to enter into this Agreement; (ii) the execution, delivery and performance of this
Agreement have been duly authorized by all corporate action necessary on its part; (iii) as of the
Effective Date the execution, delivery and performance of this Agreement by Schering does not
conflict with any agreement, instrument or understanding, oral or written, to which it is a party
or by which it is bound, and Schering will not enter into any such agreement or arrangement during
the term of this Agreement which would conflict with Schering’s performance and obligations
hereunder; (iv) Schering and its Affiliates and Sublicensees shall conduct all development,
manufacture, marketing and sales of Licensed Products in accordance with applicable laws and
regulations; and (v) as of the Effective Date, it has not omitted to furnish Santarus with, nor
intentionally concealed from Santarus, any information in its possession concerning its obligations
hereunder or the transactions contemplated by this Agreement, which would be material to Santarus’
decision to enter into this Agreement and to undertake the commitments and obligations set forth
herein.

     7.2 Disclaimer of Warranties. EXCEPT AS OTHERWISE EXPRESSLY STATED IN THIS ARTICLE 7,
SCHERING AND SANTARUS EXPRESSLY DISCLAIM ANY WARRANTIES OR CONDITIONS, EXPRESS, IMPLIED, STATUTORY
OR OTHERWISE, WITH RESPECT TO ITS CONFIDENTIAL INFORMATION, PRODUCTS, AND THE SANTARUS IP,
INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY, NONINFRINGEMENT, OR FITNESS FOR A
PARTICULAR PURPOSE, ENFORCEABILITY AND/OR VALIDITY OF THE SANTARUS PATENTS, OR NON-INFRINGEMENT OF
THE INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES.

     7.3 Indemnification.

          7.3.1 By Santarus. Santarus shall indemnify, defend and hold Schering, its Affiliates,
directors, employees, agents and representatives harmless from and against all liabilities, claims,
demands, expenses (including, without limitation, reasonable attorneys and professional fees and
other costs of litigation), losses or causes of action asserted by a Third Party (each, a “Claim”)
that arise from:

               (i) a breach of a representation, warranty or covenant in this Agreement by Santarus; or

               (ii) a negligent act or omission or willful misconduct by Santarus, its Affiliates or
sublicensees in the performance of its obligations under this Agreement;

except, in all cases, to the extent that such Claim arises out of the negligence or willful
misconduct of Schering, its Affiliates or Sublicensees or a breach by Schering of a representation,
warranty or covenant in this Agreement.

          7.3.2 By Schering. Schering shall indemnify, defend and hold Santarus, its Affiliates,
directors, sublicensees, employees, agents and representatives, and the Curators of the University
of Missouri, harmless from and against all Claims that arise from:

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               (i) a breach of a representation, warranty or covenant in this Agreement by Schering (or by
its Affiliates and Sublicenses with respect to Section 7.1.2(iv) only);

               (ii) a negligent act or omission or willful misconduct by Schering or its Affiliate or
Sublicensee in the performance of its obligations under this Agreement; or

               (iii) the development, sale or other exploitation of Licensed Products by or under the
authority of Schering or its Affiliate or Sublicensee;

except, in all cases, to the extent that such Claim arises out of the negligence or willful
misconduct of Santarus or its Affiliate or a breach by Santarus of a representation, warranty or
covenant in this Agreement.

          7.3.3
Procedures. A person or entity entitled to indemnification
under this Section 7.3 (an
“Indemnified Party”) shall give prompt written notification (within twenty (20) days) to the Party
from whom indemnification is sought (the “Indemnifying Party”) of the commencement or notice of any
Claim for which indemnification may be sought or, if earlier, upon the assertion of any such Claim
(it being understood and agreed, however, that the failure by an Indemnified Party to give notice
of a Claim as provided in this Section 7.3.3 shall not relieve the Indemnifying Party of its
indemnification obligation under this Agreement except, and only, to the extent that such
Indemnifying Party is materially prejudiced as a result of such failure to give notice). The
Indemnifying Party shall be liable for any reasonable legal fees and expenses subsequently incurred
in connection with the defense of such Claim after receiving such notice.

          7.3.4 Upon receiving such notice, the Indemnifying Party shall be entitled to assume control
of the defense of such Claim; provided that if it does so, then the Indemnified Party shall remain
entitled to participate in the defense of such Claim and to employ counsel at its own expense to
assist in the handling of such Claim. The Indemnifying Party shall obtain the prior written
approval of the Indemnified Party before (i) entering into any settlement or consent judgment or
other voluntary final disposition of such Claim or (ii) ceasing to defend against such Claim, if
that would: (a) subject the Indemnified Party to injunctive or other equitable relief; (b) include
any admission of wrongdoing on the part of the Indemnified Party; (c) affect the Indemnified
Party’s business or prospects beyond those directly concerning the Licensed Product; or (d)
otherwise conflict with the limitations set forth in Section 6.4.4. Additionally, the Indemnifying
Party shall not consent to any settlement or consent judgment or other voluntary final disposition
that does not include an unconditional and complete release from liability regarding such Claim for
each Indemnified Party. Further, if the Indemnifying Party assumes control of such defense and the
Indemnified Party reasonably concludes, based on advice from counsel, that the Indemnifying Party
and the Indemnified Party have conflicting interests with respect to such Claim, the Indemnifying
Party shall be responsible for the reasonable fees and expenses of counsel to the Indemnified Party
solely in connection therewith.

          7.3.5 If the Indemnifying Party does not assume control of the defense of such Claim, the
Indemnified Party shall have the right to defend such Claim in such manner as it may deem
appropriate at the cost and expense of the Indemnifying Party, and the Indemnifying Party shall
promptly reimburse the Indemnified Party for such expenses on a quarterly basis. The Indemnified
Party shall provide to the Indemnifying Party, as promptly as practicable after any claim for
indemnification hereunder, such information and documentation as may be reasonably requested by the
Indemnifying Party to support and verify the amounts requested, so long as such disclosure would
not violate the attorney-client privilege of the Indemnified Party.

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     7.4 Insurance.

          7.4.1 Santarus. Santarus shall maintain comprehensive general liability (CGL) insurance,
including broad form contractual liability and product liability coverages, in an amount
of at least [***] dollars ($[***]) for bodily injury and property damage. Santarus shall
maintain such insurance during the term of this Agreement and thereafter for a period of [***]
years. Schering shall be named as an additional insured under Santarus’ CGL policy. Upon request,
Santarus shall provide Schering with a certificate of insurance as evidence of the requested
coverages and shall give Schering at least thirty (30) days notice of any cancellation or
termination of such insurance.

          7.4.2 Schering. Santarus acknowledges that Schering is self-insured. Schering shall maintain
self-insurance at levels at least consistent with the levels of insurance described for
Sublicensees in this Section 7.4.2 during the term of this Agreement and for a period of five (5)
years thereafter. Schering shall ensure that its Sublicensees maintain comprehensive general
liability (CGL) insurance, including broad form contractual liability and product liability
coverages, in an amount of at least [***] dollars ($[***]) for bodily injury and property damage
during the term of this Agreement and thereafter for a period of [***] years. Santarus shall be
named as an additional insured under any such CGL policy(ies). Upon request, Schering shall
provide Santarus with a certificate of insurance as evidence of the requested coverages and shall
give Santarus at least thirty (30) days notice of any cancellation or termination of such
insurance.

     7.5 LIMITATION OF LIABILITY. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN SECTION 11.3.3(d), AND
EXCLUDING INDEMNIFICATION RIGHTS AND OBLIGATIONS UNDER THIS ARTICLE 7 AND LIABILITY OF A PARTY FOR
BREACH OF ITS OBLIGATIONS UNDER ARTICLE 8, NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR INDIRECT,
INCIDENTAL, CONSEQUENTIAL, SPECIAL, PUNITIVE OR EXEMPLARY DAMAGES, INCLUDING BUT NOT LIMITED TO
LOST PROFITS, ARISING FROM OR RELATING TO ANY BREACH OF THIS AGREEMENT, REGARDLESS OF ANY NOTICE OF
THE POSSIBILITY OF SUCH DAMAGES OR THE FAILURE OF THE ESSENTIAL PURPOSE OF ANY REMEDY.

ARTICLE 8

CONFIDENTIALITY

     8.1 Confidentiality. The term “Confidential Information” means any proprietary technical or
business information or data related to, or generated in connection with, the performance of this
Agreement and that is provided by one Party (the “Disclosing Party”) to the other Party (the
“Receiving Party”) pursuant to this Agreement. Except as expressly provided herein, the Parties
agree that, during the Term of this Agreement and for a period of ten (10) years thereafter, the
Receiving Party shall keep completely confidential and shall not publish or otherwise disclose to
any Third Party that is not an Affiliate of, or consultant to (and bound in writing to protect
Confidential Information no less stringently than herein), the Receiving Party (except under no
less stringent obligations of confidentiality and only for purposes expressly permitted herein) and
shall not use for any purpose except for the purposes expressly contemplated by this Agreement, any
Confidential Information furnished to it by the Disclosing Party pursuant to this Agreement. To
the extent it can be established by written documentation, Confidential Information shall not
include information that:

               (i) is already known to the Receiving Party, other than under an obligation of
confidentiality, at the time of disclosure;

 

			
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               (ii) is generally available to the public or otherwise part of the public domain at the time
of its disclosure to the Receiving Party;

               (iii) becomes generally available to the public or otherwise part of the public domain after
its disclosure to the Receiving Party and other than through any act or omission of the Receiving
Party or a Third Party in breach of this Agreement;

               (iv) subsequently lawfully disclosed to the Receiving Party by a Third Party having no
confidentiality obligations with respect thereto;

               (v) is independently developed by the Receiving Party or its Affiliates without the aid,
application, use of or reference to the Disclosing Party’s Confidential Information (and such
independent development can be properly documented by the Receiving Party); or

               (vi) is required by law or legitimate order of an authorized governmental authority or agency
to be disclosed by the Receiving Party; provided, however, that such Receiving
Party (a) gives the Disclosing Party sufficient advance written notice, to the extent reasonably
practicable, to permit it to seek a protective order or other similar order with respect to such
Confidential Information and (b) thereafter discloses only the minimum information required to be
disclosed in order to comply, whether or not a protective order or other similar order is obtained
by such Disclosing Party.

     8.2 Agreement Terms/Publicity. Except to the extent that this Agreement must be filed with
the Securities and Exchange Commission, each Party agrees to hold as confidential this Agreement
and its terms and agrees to consult with the other Party before issuing any press release or making
any public statement regarding it and, except as may be required by applicable law or any listing
agreement with any national securities exchange, will not issue any such press release or make any
public statement prior to such consultation and without first obtaining the prior written consent
of the other Party, such consent not to be unreasonably withheld or delayed. The Party proposing
to make the press release or other public statement shall give due consideration to any reasonable
comments by the other Party relating to such proposed press release or other public statement.
Notwithstanding the foregoing, in connection with the execution of this Agreement, Santarus may
issue a press release with such content as may be mutually agreed. The principles to be observed
by Schering and Santarus in press releases or other public statements regarding this Agreement
shall be: accuracy, compliance with applicable legal requirements, the requirements of
confidentiality under this Article 8 and normal business practice in the pharmaceutical industry
for such disclosures by companies comparable to Schering and Santarus. For the avoidance of doubt,
either Party may issue such press releases as it determines, based on advice of counsel, are
reasonably necessary to comply with law or for appropriate market disclosure. In addition, if a
public disclosure is required by law, including without limitation in a filing with the United
States Securities and Exchange Commission, the disclosing Party shall provide copies of the
proposed disclosure reasonably in advance of such filing or other disclosure for the non-disclosing
Party’s prior review and comment and shall give due consideration to any reasonable comments by the
non-filing Party relating to such filing, including without limitation the provisions of this
Agreement for which confidential treatment should be sought.

     8.3 Permitted Use and Disclosures. The Receiving Party may disclose the Disclosing Party’s
Confidential Information to Regulatory Authorities to the extent that such disclosure is reasonably
necessary to exercise any rights under this Agreement to develop, manufacture or commercialize (i)
Licensed Products in the Field in the Territory, in the case of Schering, and (ii) Prescription
Products bearing the Santarus Marks in the Territory, in the case of Santarus. Further, a Party
may disclose (a) the existence and terms of this Agreement to existing or

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potential investors or
acquirers or merger partners, or to professional advisors (e.g., attorneys, accountants and
prospective investment bankers) involved in such activities, for the limited purpose of evaluating
such investment or transaction and under appropriate conditions
of confidentiality, only to the extent reasonably necessary and (b) the existence and terms
(other than financial terms) of this Agreement to actual or bone fide potential Sublicensees (in
the case of disclosure by Schering), or to actual or bona fide potential licensees of Prescription
Products in the Territory and/or Products outside the Territory (in the case of disclosure by
Santarus), in each of cases (a) and (b) above with the agreement by these permitted individuals to
maintain such Confidential Information in strict confidence. Santarus may disclose the existence
and terms of this Agreement to the Curators of the University of Missouri pursuant to the Missouri
Agreement, subject to the confidentiality provisions set forth therein.

ARTICLE 9

TERM AND TERMINATION

     9.1 Term. Unless earlier terminated as provided in this Article 9 (and Section 11.3.3(d), if
applicable), this Agreement shall come into force on the Effective Date and shall continue for as
long as Schering or an Affiliate or Sublicensee is marketing Licensed Products in the Field and
Territory.

     9.2 Termination for Breach. This Agreement may be terminated by either Party if the other
Party is in material breach of its material obligations hereunder and has not cured such breach
within thirty (30) days after the date on which written notice requesting cure of the breach and
providing reasonable detail of the particulars of the alleged breach is sent to the breaching
Party; provided, however, that the cure period for late payments due hereunder shall be fifteen
(15) days; and further provided, however, if the allegedly breaching Party disputes in good faith
the existence of such breach, or if the Parties dispute in good faith whether such breach has been
cured, then the dispute resolution provisions of Section 11.3 shall apply. It is understood and
agreed that the cure period described above shall not apply with respect to termination as set
forth in Section 3.7, except as expressly otherwise set forth in Section 3.7.3(a), above.

     9.3 Termination by Schering. Schering may terminate this Agreement in its entirety on one
hundred eighty (180) days prior written notice to Santarus under the following conditions: (a)
anytime after submitting its first NDA for a Licensed Product; or (b) if Schering does not receive
Marketing Approval in the U.S. for a Licensed Product before [***].

     9.4 Insolvency. Upon the filing or institution of bankruptcy, reorganization, liquidation or
receivership proceedings, or upon an assignment of a substantial portion of the assets for the
benefit of creditors by a Party, or in the event a receiver or custodian is appointed for such
Party’s business, or if a substantial portion of such Party’s business is subject to attachment or
similar process, then the other Party may terminate this Agreement; provided, however, that in the
case of any involuntary bankruptcy proceeding such right to terminate shall only become effective
if the proceeding is not dismissed within sixty (60) days after the filing thereof. All licenses
granted under this Agreement are deemed to be, for purposes of Section 365(n) of the U.S.
Bankruptcy Code, licenses of right to “intellectual property” as defined in Section 101 of such
Code.

     9.5 Effect of Termination. Subject to the dispute resolution procedures of Section 11.3 (if
applicable), the provisions of this Section 9.5 apply in the event this Agreement is terminated.

          9.5.1 Schering Licenses. Upon any termination of this Agreement, all licenses and rights
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terminate, and
Santarus shall thereafter have the right (itself or through Third
Parties) to continue the development, manufacture and commercialization of the Licensed
Products in the Field and Territory without obligation to Schering.

          9.5.2 Transfer of Licensed Product Rights and Transition Matters.

               (a) Wind-Down Period.

                    (i) Development. In the event that Schering and/or its Affiliate has any on-going clinical
trials for Licensed Products in the Field in the Territory on the effective date of termination,
Schering agrees, at Santarus’ request, to either promptly transition such clinical trials to
Santarus or continue to conduct such clinical trials, at Santarus’ expense, for a period requested
by Santarus up to a maximum of [***] months after such termination.

                    (ii) Stock on Hand; Continuing Sales. Schering and its Affiliates and permitted Sublicensees
shall have the right, for a period of up to [***] months following such termination, to sell (in
the Field in the Territory) stocks of Licensed Products on hand at the time of such termination
(for which Marketing Approval in the Field in the Territory has been approved prior to such
termination), subject to all applicable payment, indemnity and other obligations set forth in this
Agreement. In addition, Schering and its Affiliates and permitted Sublicensees agree to continue
to distribute existing stocks of Licensed Products in the Field in the Territory for which
Marketing Approval has been obtained, in accordance with, and subject to, the terms and conditions
of this Agreement, for a period requested by Santarus, not to exceed [***] months from such
termination, (for purposes of this Section 9.5.2, the “Wind-down Period”). Notwithstanding any
other provision of this Agreement, during the Wind-down Period, Schering’s and its Affiliates’ and
permitted Sublicensees’ rights with respect to Licensed Products in the Territory shall be
non-exclusive, and Santarus shall have the right to engage one or more other distributor(s) and/or
licensee(s) of the Licensed Products in all or part of the Territory. Except as provided in this
Section 9.5.2(a)(ii), promptly after termination, Schering and its Affiliates and Sublicensees
shall cease to sell, and thereafter for a period of [***] shall not sell, Licensed Products in the
Territory, and Schering and its Affiliates and Sublicensees shall discontinue making any
representation regarding their status as a licensee of Santarus in the Territory for Licensed
Products.

               (b) Transition Assistance and Continuation of Supply. Schering shall cooperate with
reasonable requests by Santarus to achieve, as promptly as reasonably practicable following the
effective date of termination, a smooth and orderly transition to Santarus of the development,
manufacturing, and commercialization of Licensed Products for the Territory, including making its
personnel and other resources reasonably available to Santarus, at Schering’s expense. If Schering
has entered into contracts with Third Parties (including contract manufacturers or vendors) whose
services are reasonably necessary for Santarus to assume responsibility for the Licensed Products
in the Field in the Territory, then Schering shall, to the extent reasonably possible and requested
in writing by Santarus, assign all of such relevant Third Party agreements to Santarus. In the
event that prior to, and until, the effective date of such termination, Licensed Products were
manufactured by Schering or its Affiliates, Schering or its Affiliates shall continue to supply
Santarus’ requirements for the Territory of Licensed Products conforming to applicable
specifications in effect as of the effective date of such termination, upon request of Santarus,
for a period of up to [***] years, at a price of [***] plus reasonable delivery, determined in
accordance with United States generally acceptable accounting practices. Licensed Product orders,
delivery and payment will be made according to Schering’s established procedures at the time of
termination.

               (c) Assignment of Regulatory Filings and Marketing Approvals. Schering shall assign and
transfer, or cause to be assigned and transferred, to Santarus (or if

 

			
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not so assignable, Schering
shall take all reasonable actions to make available to Santarus the
benefits of) all of Schering’s and its Affiliates’ Regulatory Filings and Marketing Approvals
in the Territory for the Licensed Products in the Field and Territory, and shall take such actions
and execute such other instruments, assignments and documents as may be necessary to effect the
transfer of rights under the Regulatory Filings to Santarus. Schering shall require each of its
Sublicensees to transfer any such Regulatory Filings and Marketing Approvals for Licensed Products
in the Territory to Santarus. In each case, unless otherwise prohibited by any applicable law or
regulation, the foregoing assignment (or availability) shall be made within thirty (30) days after
the termination date of this Agreement.

               (d) Licenses to Schering Incorporated IP; Disclosure. Santarus shall retain its license to
the Schering Patents and Schering Know-How within the Schering Incorporated IP as granted in
Section 4.3. In addition, effective upon such termination, Schering will grant Santarus an
irrevocable, royalty-free, perpetual non-exclusive license, with the right to grant and authorize
sublicenses, under (i) the Schering Patents within the Schering Incorporated IP and (ii) the
Schering Know-How within the Schering Incorporated IP that is reasonably necessary for the
manufacture, use or sale of, or is referenced or submitted in support of Regulatory Filings in the
Territory for, one or more Licensed Products in the Territory, in each case as of the date of
termination of this Agreement, to make, import, have made, use, sell and offer for sale Licensed
Products in the Territory. However, in the case of any patent or patent application within the
Schering Incorporated IP Controlled by Schering that requires payment of amounts to a Third Party
pursuant to an applicable in-license, such patent application or patent shall only be deemed to be
within the scope of the license set forth in this Section if Santarus agrees in writing to
reimburse all amounts owed by Schering to such Third Party as a result of Santarus’ activities in
exercise of such license. Within ninety (90) days after the effective date of termination of this
Agreement, Schering shall disclose to Santarus (to the extent Schering has not already disclosed to
Santarus) all preclinical, clinical and other data and Schering Know-How in Schering’s or its
Affiliates’ or Sublicensees’ possession constituting Schering Incorporated IP, in electronic or
other form reasonably usable by Santarus.

               (e) Schering Marks. Schering shall promptly assign to Santarus the Schering Marks, if any,
owned by Schering, together with all rights in and to such Schering Marks, including applicable
domain name registrations, trademark registrations and all associated goodwill.

               (f) Remaining Inventory. Schering shall transfer to Santarus all quantities of Licensed
Products (including finished goods and work-in-process) in its and its Affiliates’ possession or
control, within sixty (60) days after the end of the Wind-Down Period; provided, however, that
Santarus shall pay Schering the fully-burdened manufacturing costs actually incurred by Schering to
acquire such remaining quantities, or other lesser amount if mutually agreed upon by the Parties.

     9.6 Termination Not Sole Remedy. Termination is not the sole remedy under this Agreement and,
whether or not termination is effected, all other remedies at equity or law shall remain available
to the Parties except as agreed to otherwise herein.

     9.7 Accrued Obligations. Expiration or termination of this Agreement shall not relieve the
Parties of any obligation accruing prior to such expiration or termination. Any expiration or
early termination of this Agreement shall be without prejudice to the rights of either Party
against the other Party accrued or accruing under this Agreement prior to such expiration or
termination, including the obligation to pay milestones and royalties on Net Sales occurring prior
to such expiration or termination.

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     9.8 Survival. The following provisions survive termination or expiration of this Agreement in
accordance with their terms: Sections 4.2.4, 4.3 (unless terminated as set forth in
Section 11.3.3(d)(iii)), 4.4, 4.5.2, 4.8, 5.7, 5.8, 5.9, 6.7, 7.2, 7.3, 7.4, 7.5. 9.5, 9.6,
9.7 and this Section 9.8, and Articles 8 and 11. Payment, reporting and other obligations of this
Agreement shall survive with respect to sales (if any) of Licensed Products after termination
pursuant to Section 9.5.2(a).

ARTICLE 10

ASSIGNMENT; CORPORATE TRANSACTIONS

     10.1 General Restriction on Assignment. Except as otherwise permitted in this Article 10,
neither Party may assign or transfer its rights under this Agreement and/or delegate its duties
hereunder, by merger, sale of assets, operation of law or otherwise, without the prior written
consent of the other Party, and any attempted assignments or transfer without such written consent
shall be void and of no effect. Upon any permitted assignment or transfer of this Agreement, (i)
the other Party shall be given prompt written notice of such assignment, and (ii) the assignee
shall agree in writing to be bound by the terms and conditions set forth herein.

     10.2 Certain Definitions. Except as otherwise expressly provided herein, the following terms
shall have the following meanings for purposes of this Agreement:

          10.2.1 “Competing Third Party” means any entity which (or whose Affiliate) is [***].

          10.2.2 “Santarus Change of Control” means (A) a sale, lease, or other disposition of
all or substantially all of the assets of Santarus to which this Agreement pertains to a Third
Party, (B) any consolidation or merger of Santarus with or into any other corporation or other
entity or person, or any other corporate reorganization, in which the capital stock of Santarus
immediately prior to such consolidation, merger or reorganization, represents less than fifty
percent (50%) of the voting power of the surviving entity (or, if the surviving entity is a
majority-owned subsidiary, its parent) immediately after such consolidation, merger or
reorganization; or (C) any transaction or series of related transactions to which Santarus is a
party in which at least fifty percent (50%) of Santarus’ voting power is transferred; provided,
that a “Change of Control” shall not include (i) any consolidation or merger effected exclusively
to change the domicile of Santarus, or (ii) any transaction or series of transactions with
institutional investors principally for bona fide equity financing purposes in which cash is
received by Santarus or any successor, or indebtedness of Santarus is cancelled or converted, or a
combination thereof.

          10.2.3 “Transaction Notice” is defined in Section 10.3.2, below.

          10.2.4 “PPI Product Company” shall mean a Competing Third Party for which sales of the
PPI Pharmaceutical Product(s) of such Competing Third Party (and/or its Affiliates) account for
more than [***] percent ([***]%) of the Competing Third Party’s (or/its Affiliates’) annual
revenues, or for which research and development expenditures for the PPI Pharmaceutical Product(s)
account for more than [***] percent ([***]%) of the Competing Third Party’s (and/or its
Affiliates’) research and development expenditures incurred during the twelve calendar months
preceding execution of the definitive agreement between Schering and/or its Affiliates for
acquisition of such Competing Third Party or projected expenditures for the twelve calendar months
following execution of such definitive agreement.

10.3 Assignment and/or Divestiture by Schering.

          10.3.1 Non-Competing Third Party. Schering may assign this Agreement without the consent of
Santarus to an entity that is not a Competing Third Party and
which

 

			
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acquires all or substantially all of Schering’s OTC business in the Territory, whether
by merger, sale of assets or otherwise.

          10.3.2 Competing Third Party. In the event that Schering and/or its Affiliate enters into a
definitive agreement (i) for a Competing Third Party to acquire all, or substantially all, of
Schering’s OTC business in the Territory, or (ii) for Schering or its Affiliate to acquire a
Competing Third Party, then Schering shall provide Santarus with written notice of such transaction
(a “Transaction Notice”) on or before the business day immediately following the date on which the
definitive agreement for such transaction is signed. Santarus shall have the right, in
its discretion, to consent to such transaction and (if applicable) assignment of this Agreement to
such Competing Third Party within [***] days following receipt of a Transaction Notice from
Schering. If Santarus does not give written notice of its consent within such period, then:

               (a) if the Competing Third Party is a PPI Product Company, then Schering shall not have the
right to assign this Agreement in connection with such transaction without Santarus’ prior written
consent, and the terms and conditions of this Agreement (including without limitation the
provisions of Section 4.6 and 9.2) shall apply; and

               (b) if the Competing Third Party is not a PPI Product Company, then Schering and/or the
Competing Third Party (and/or the Affiliates of either) shall choose in their discretion between,
and shall divest, either (i) its (and its Affiliates’) complete interest in the Licensed Products
in the Territory or (ii) its (and its Affiliates’) complete interest in the other PPI
Pharmaceutical Product(s), as set forth in Section 10.3.3 below.

          10.3.3 Divestiture Process. In the event that Schering and/or the Competing Third Party
(and/or their Affiliates) are required to divest either the Licensed Products or the other PPI
Pharmaceutical Product(s) under Section 10.3.2(b), then:

               (a) Schering shall notify Santarus in writing, within [***] days following the Transaction
Notice, which product(s) (Licensed Products or the other PPI Pharmaceutical Product(s)) will be
divested.

               (b) Such divestiture of either the Licensed Products or the other PPI Pharmaceutical
Product(s) shall occur and be completed (other than completion of any applicable waiting period
under the HSR Act or similar laws or regulations requiring a waiting period prior to consummation
of the transaction) within the greater of either [***] following the applicable Transaction Notice
or [***] following the earlier of (i) written notice of Santarus’ decision not to acquire
Schering’s interest in the Licensed Products pursuant to Section 10.3.3(d) below or (ii) expiration
of the [***] period described in Section 10.3.3(d).

               (c) Should Schering choose to divest the Licensed Products, then Schering will engage an
independent investment banker at Schering’s expense to provide a valuation of Schering’s interest
in this Agreement and the Licensed Products in the Territory (the “Valuation”) and shall provide
Santarus with a copy of the written Valuation opinion of the investment banker within [***]
following the date of the Transaction Notice. In determining such Valuation, the investment banker
shall take into account all relevant economic factors, including without limitation improvements
made by Schering and the value of any applicable Schering Incorporated IP, the effect (if any) of
the divestiture on the value of the Licensed Products, the projected effect of Schering’s (or its
successor’s or their Affiliates’) becoming a competitor to Licensed Products through sales of PPI
Pharmaceutical Product(s), the value (if any) of brand identity established by Schering for the
Licensed Products that would be transferred with the Licensed Products, Third Party royalties if
any (including without limitation royalties that may be due to the University of Missouri), and
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               (d) Santarus shall have the right to elect, until the later of [***] after the date of the
Transaction Notice or [***] following receipt of the written Valuation as described in Section
10.3.3(c), above, to acquire all of Schering’s interest in the Licensed Products at the price set
forth in the following sentence, in which event Santarus shall pay such amounts to Schering within
[***] after giving notice of such election. The applicable price for Santarus to acquire all of
Schering’s interest in the Licensed Products pursuant to this Section 10.3.3(d) shall be [***].

               (e) If Santarus does not elect to acquire such interest from Schering within the [***] period
described in Section 10.3.3(d), above, then Schering shall transfer its and its Affiliates’
interest in the Licensed Products and subject matter of this Agreement, to a Third Party other than
a Competing Third Party (and/or its Affiliates), which Third Party has [***], through an auction
process conducted by an independent investment banker (which may in Schering’s discretion be the
same as the investment banker described in Section 10.3.3(c) above), which divestiture (A) shall be
completed within the time period set forth in Section 10.3.3(b), above and (B) shall be at a price
no less than the price offered to Santarus pursuant to Section 10.3.3(d), above; provided, however,
that Santarus shall have the right to identify (by written notice given within [***] following
Santarus’ receipt of the Transaction Notice), up to [***] Third Parties with which Santarus does
not wish to have a contractual relationship and/or to convey the licenses set forth herein, in
which event this Agreement shall not be assigned to the Third Parties so identified by Santarus,
and Schering’s interest in the Licensed Products in the Territory shall not be transferred to such
Third Parties, without Santarus’ prior written consent, which may be withheld in Santarus’
discretion.

               (f) During the pendency of divestiture by Schering and/or the Competing Third Party of either
the Licensed Products in the Territory or the other PPI Pharmaceutical Product(s), Schering
covenants that it (and its successor-in-interest, if any, and their Affiliates): (A) shall
continue to perform all obligations hereunder and shall use their active, sustained and diligent
efforts to maintain sales of, and diligently continue manufacture, development and
commercialization of, the Licensed Products in the Field throughout the Territory; (B) shall use
all reasonable efforts to facilitate transition of Schering’s and its Affiliates’ interest in the
Licensed Products as permitted or required under this Section 10.3.3; and (C) without limiting the
restrictions set forth in Section 4.8 above, shall not without Santarus’ prior written consent
disclose or transfer, to any Affiliate, division or person actively involved in activities related
to the development, manufacture or commercialization of the Competing Third Party’s PPI
Pharmaceutical Products, any information directly related to the development, manufacture or
commercialization of Licensed Products hereunder or any Confidential Information of Santarus, other
than (1) information contained in publicly available filings with the Securities Exchange
Commission or other publicly available sources and/or (2) materials obtained from (and in the
format obtained from) a Third Party and generally made available by such Third Party for purchase.
It is understood that the foregoing does not prohibit Schering from exercising its rights under
Section 8.3 or from disclosing to its parent company its own Confidential Information regarding its
efforts to develop, commercialize and market Licensed Products in the Territory to the extent
necessary for its acquisition or divestment process, corporate governance, compliance and auditing
purposes, or to the extent necessary to perform its global pharmacovigilance obligations or
otherwise perform its obligations under this Agreement.

               (g) For clarity, it is understood and agreed that Schering may assign, and shall assign, this
Agreement in its entirety to a Third Party that acquires Schering’s interest in the Licensed
Products through the divestiture procedure set forth in this Section 10.3.3.

               (h) It is understood and agreed that Schering shall retain, without obligation to Santarus or
the University of Missouri, the consideration, if any, paid to Schering in

 

			
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connection with divestiture of the Licensed Products and assignment of this Agreement as set
forth in this Section 10.3.3.

          10.3.4 Survival of Certain Rights and Licenses After Assignment. It is understood and agreed
that all licenses, rights to access and use data and information, and rights to reference
regulatory filings, conveyed to Santarus from Schering under Sections 3.2.3, 3.2.4 and 4.3 of this
Agreement shall survive any assignment by Schering.

     10.4 Assignment by Santarus. Subject to this Section 10.4, Santarus may assign this Agreement
without the consent of Schering to an entity (the “Santarus Acquirer”) that acquires all or
substantially all of Santarus’ business to which this Agreement relates, whether by merger, sale of
assets or otherwise.

          10.4.1 Competing Santarus Acquirer. If the Santarus Acquirer is a Competing Third Party (a
“Competitive Santarus Acquirer”), Santarus shall provide Schering with written notice of
such transaction on or before the first business day following the date on which the definitive
agreement for such transaction is signed, and Schering shall have the right, within [***] days
after receiving such notice, to elect by written notice to Santarus (or its successor-in-interest),
to dissolve the JSC and undertake the following changes:

               (a) the JSC shall be discontinued immediately;

               (b) all approvals and decisions of the JSC in effect at that time shall thereafter continue in
effect;

               (c) all activities of Schering and its Affiliates and Sublicensees for the development,
manufacture, commercialization and marketing of Licensed Products following such assignment shall
not be subject to further review and approval by the Santarus Acquirer, provided that such
activities are consistent with the terms and conditions of this Agreement and approvals in effect
at the time of discontinuation of the JSC (or approved pursuant to (d) or (e) below);

               (d) such Santarus Acquirer shall be obligated to reasonably consider requests by Schering to
expand Schering’s rights or approve matters that would have been subject to Santarus’ approval
through the JSC, consistent with the terms of this Agreement and consistent with the Parties’
intent for Schering not to exercise its licensed rights under the Santarus IP in a manner to reduce
the market for Prescription Products outside the Field and bearing the Santarus Marks; and

               (e) upon written notice by Schering, Schering may require that any request by Schering
described in Section 10.4.1(d) above be referred to a neutral referee for resolution as set forth
in Section 11.3.4.

          10.4.2 Loss of Exclusivity. In the event that Santarus has been acquired by a Competitive
Santarus Acquirer and (a) there are no Valid Claims within the Santarus Patents or other patents
owned or controlled by Santarus claiming [***], and (b) one or more Third Parties have begun [***],
then Schering’s license under this Agreement shall no longer require JSC or Santarus Acquirer
approvals for, or be subject to Santarus Acquirer deciding vote with respect to, [***] for Licensed
Products in the Field in the Territory and/or matters addressed in items (a), (b), (c) or (e) of
Section 2.6.4; provided that Schering’s actions are consistent with Schering’s payment and other
obligations under this Agreement (excluding the need for such JSC approvals).

 

			
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ARTICLE 11

GENERAL PROVISIONS

     11.1 Force Majeure. Neither Party shall be responsible to the other for failure or delay in
performing any of its obligations under this Agreement (except the obligation to make payments when
properly due) or for other non-performance hereof to the extent that such delay or non-performance
is directly caused by a circumstance beyond the reasonable control and without fault or negligence
of such Party, including, but not limited to earthquake, fire, flood, explosion, war, national
health emergency, act of terrorism, discontinuity in the supply of power, court order or
governmental interference, act of God, strike or other labor trouble (a “force majeure” condition),
and provided that the affected Party shall promptly inform the other Party of this condition as
soon as is reasonably practicable and shall exert reasonable efforts to eliminate, cure and
overcome any such causes and to resume performance of its obligation with all possible speed.
However, nothing contained herein shall require any Party to settle any strike, lock-out or other
labor difficulty, any investigation or proceeding by any public authority, or any litigation by any
Third Party on terms unsatisfactory to such Party. If the force majeure condition exists for more
than ninety (90) consecutive days, the Parties shall meet to negotiate a mutually satisfactory
resolution to the problem, if practicable.

     11.2 Governing Law. The validity, performance, construction, and effect of this Agreement
shall be governed by the laws of the State of New York, United States of America, without regard to
conflict of laws principles.

     11.3 Dispute Resolution.

          11.3.1 Informal Resolution. Except as otherwise provided in this Section 11.3 below, in the
event of any controversy or claim arising out of, relating to or in connection with any provision
of this Agreement or the rights or obligations of the Parties hereunder, the Parties will try to
settle their differences amicably between themselves as contemplated herein. Either Party may
initiate such informal dispute resolution by sending written notice of the dispute, and an intent
to arbitrate such dispute, if not resolved, to the other Party. Within thirty (30) days after such
notice, appropriate representatives of the Parties shall meet in person to negotiate in good faith
a resolution to the dispute within such thirty (30) day period. If such representatives are unable
to promptly resolve such disputed matter within the said thirty (30) days, either Party may refer
the matter by written notice to the other Party to Schering’s Chairman (or the acting head) of its
Consumer Division, or his/her designee with authority to resolve such matter, and the Chief
Executive Officer of Santarus, or his/her designee with authority to resolve such matter, for
discussion and resolution. If such individuals or their designees are unable to resolve such
dispute within thirty (30) days of such written notice, either Party may initiate arbitration
proceedings in accordance with Sections 11.3.2 through 11.3.4, as applicable.

          11.3.2 Non-Binding Determination; Tolling of Cure Period.

               (a) Notwithstanding Section 9.2, above, if a Party alleged to be in breach of a material
obligation or provision of this Agreement disputes the existence of such breach within the
applicable thirty (30) day cure period described in Section 9.2, or if the Parties dispute whether
such breach has been cured, the parties shall submit such dispute to a single arbitrator from the
American Arbitration Association (“AAA”) for a preliminary, non-binding determination as to whether
it was more likely than not that a material obligation or provision of this Agreement was breached
(and/or whether such breach has been cured), such determination to be made within sixty (60) days
following initiation of the arbitration. Such arbitration shall be conducted in Chicago, Illinois,
pursuant to the commercial arbitration rules of the AAA, as modified by the
procedures set forth in this Section 11.3.2. If the Parties cannot agree on an arbitrator
within ten (10) days following submission of the matter to arbitration, then the AAA shall select a
neutral arbitrator within

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ten (10) days thereafter. The arbitrator shall limit, or expedite by the
arbitrator’s order, discovery, briefing and/or argument with a goal of permitting a final
determination within the applicable sixty-day period, and with a goal of limiting the expense and
burden on the Parties, but shall order such discovery, briefing and argument as the arbitrator
deems necessary to permit a reasonable preliminary determination as set forth herein.

               (b) If the arbitrator determines that it is more likely than not that a full arbitration in
accordance with Section 11.3.3 would result in a finding that (or, if applicable, that a court of
competent jurisdiction would determine that) the asserted breach was a breach of a material
obligation or provision of this Agreement and has not been cured, the breaching Party shall then
have thirty (30) days following such determination to cure such alleged breach, and any right of
termination under Section 9.2 shall be tolled during such thirty (30) days period.

               (c) Alternatively, if on the other hand, the arbitrator determines either that, (i) it is
more likely than not that a full arbitration in accordance with Section 11.3.3 would result in a
finding that (or, if applicable, that a court of competent jurisdiction would determine that) the
asserted breach was not a breach of a material obligation or provision of this Agreement, or (ii)
that such breach has been cured, then the applicable cure period shall be tolled and the
non-breaching Party shall not have the right to terminate this Agreement (and/or to obtain the
alternative remedies described in Section 11.3.3(d) below) unless and until it has been finally
determined under Section 11.3.3 that a material obligation or provision of this Agreement has been
breached and the breaching Party fails to cure such breach within thirty (30) days after such
determination.

               (d) It is understood that a determination by the arbitrator in accordance with this Section
11.3.2 will not be binding on the Parties as to whether the disputed activity was in fact a breach
of a material obligation or provision of this Agreement (and/or whether any such breach has been
cured). In any case, a final determination of whether an uncured breach of a material obligation
or provision of this Agreement has occurred shall be determined only pursuant to Section 11.3.3
below. If the dispute proceeds to binding arbitration as set forth in Section 11.3.3, below, the
arbitrators for such proceeding shall be different than the arbitrator for the proceeding described
in this Section 11.3.2. In no event shall any Party be entitled to invoke the provisions of this
Section 11.3.2 more than once with respect to each such alleged breach.

          11.3.3 Full Arbitration. If a dispute is unresolved following attempted informal dispute
resolution pursuant to Section 11.3.1, then either Party may initiate arbitration before a panel of
three (3) arbitrators in accordance with the commercial arbitration rules of the AAA then in force
(whether or not either Party has initiated the non-binding arbitration described in Section
11.3.2); provided, however, that any dispute related to the infringement, validity or enforcement
of any intellectual property right shall be heard by a court of competent jurisdiction in the
country where such right exists. The following provisions shall apply with respect to such
arbitration:

               (a) Arbitrators. Within thirty (30) days after receipt of the notice of arbitration by the
Party not initiating such arbitration, each Party shall appoint an arbitrator who is independent of
the Parties (which arbitrator appointed by Schering shall have reasonable knowledge regarding the
consumer packaged goods industry, and which arbitrator appointed by Santarus shall have reasonable
knowledge regarding the pharmaceutical industry), and those two arbitrators shall appoint the third
arbitrator within thirty (30) days. In the event that the two (2) arbitrators are unable to agree
on a third within the required time, either Party may apply

44

 

under the applicable rules of the AAA for the appointment of that third arbitrator, and the
selection of an arbitrator under such rules of the AAA shall be final and binding on the Parties.

               (b) Process. The arbitration panel shall determine what discovery will be permitted; provided
that the arbitration panel shall permit such discovery as the panel deems necessary to permit a
fair resolution of the dispute. The Parties shall seek to timely appoint their respective
arbitrators and to have the full panel of three (3) arbitrators appointed within three (3) months
after the non-initiating Party received the notice of termination, and seek to conclude the
arbitration within nine (9) months after the full arbitration panel has been appointed. The place
of arbitration shall be Chicago, Illinois.

               (c) Final and Binding. The Parties agree that the award rendered shall be final and binding
upon the Parties, and shall be the sole and exclusive remedy with respect to all disputes,
controversies, claims and counterclaims presented to the arbitrators (which shall not include any
dispute related to the infringement, validity or enforcement of any intellectual property).

               (d) Remedies. [***]. In determining the appropriate remedy(ies) hereunder, the arbitrators
may take into account the number of prior breaches committed by a breaching Party, the number of
prior accusations of breaches alleged by the Parties and any prior breaches found to be in bad
faith. In the event that the arbitrators determine that there has been a material breach of a
material provision of this Agreement, and that such breach has not been cured, the non-breaching
Party shall be entitled to termination of this Agreement pursuant to Section 9.2, except as
follows:

                    (i) If, pursuant to Section 11.3.2, the cure period with respect to such breach has been
tolled pending binding arbitration under this Section 11.3.3, then the non-breaching Party shall
not be entitled to terminate this Agreement unless the breaching Party has failed to cure such
breach within thirty (30) days after the final determination of such breach by the arbitrators
under this Section 13.3.3, and the arbitration panel shall retain authority to hear a dispute or
motion by either Party concerning the adequacy of any such cure for a period of thirty (30) days
following such cure period (and any extension thereof granted or agreed to, in writing, by the
non-breaching Party). For clarity, it is understood that any dispute regarding the adequacy of
such cure shall not be subject to Section 11.3.2 above.

                    (ii) If (A) Schering is the breaching Party, (B) the breach is not a breach of Schering’s
obligations under Section 4.6, and (C) at the time of the arbitration, Schering has [***], then the
Santarus shall not automatically be entitled to termination of this Agreement; provided, however,
that the arbitrators shall order such remedy(ies) as the arbitrators determine are fair and
equitable under the circumstances, which remedies may in the arbitrators’ discretion include: (X)
[***], and/or (Y) termination of this Agreement pursuant to Section 9.2, such termination subject
to the applicable period to cure (and authority of the arbitration panel to determine adequacy of
such cure) as described in (i) above, if any. In shaping and awarding such remedies, if any, the
arbitration panel shall consider and weigh Santarus’ damages suffered, the relative faults of the
Parties and their actions taken to mitigate damages, the value of the rights in Licensed Product to
be transferred to Santarus if termination is ordered, the value of Schering’s efforts in
establishing such value in the Licensed Product, and the value of the rights and licenses conveyed
by each Party to the other under this Agreement. Notwithstanding the foregoing, it is understood
and agreed that Santarus shall be entitled to termination of the Agreement for material breaches of
Section 4.6.

                    (iii) If Santarus is the breaching Party (and subject to the applicable period to cure, and
authority of the arbitration panel to determine adequacy of such cure, as described in (i) above,
if any), the arbitrators shall order such remedy(ies) as the arbitrators

 

			
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and filed separately with the Securities and Exchange Commission.
Confidential treatment has been requested with respect to the omitted portions.

45

 

determine are fair and equitable under the circumstances, which remedies may in the
arbitrators’ discretion include: (A) an award of damages (subject to the limitations of Section
7.5), (B) a reduction in the royalties payable by Schering to Santarus hereunder (provided,
however, that the panel shall not be empowered to reduce the royalties due Santarus below [***]
percent ([***]%) of the amount otherwise due, nor below the royalty (if any) then owed by Santarus
under the Missouri Agreement on account of Net Sales of such Licensed Products in the Territory),
and/or (C) termination of the license to Santarus under Section 4.3 with respect to Schering
Know-How (other than Schering Know-How within the Schering Incorporated IP that is reasonably
necessary for the manufacture, use or sale of, or is referenced or submitted in support of
Regulatory Filings in the Territory for, one or more Prescription Products outside the Field in the
Territory bearing the Santarus Marks (or intended to bear the Santarus Marks upon Marketing
Approval)). In shaping and awarding such remedies, if any, the panel shall consider and weigh
Schering’s damages suffered, the relative faults of the Parties, and the value of the rights and
licenses conveyed by each Party to the other under this Agreement.

               (e) Not Public. The arbitration proceedings and the decision shall not be made public without
the joint consent of the Parties, and each Party shall maintain the confidentiality of such
proceedings and decision unless otherwise permitted by the other Party, except to the extent (and
solely to the extent) either party is required to disclose such information by applicable
securities or other laws.

               (f) Courts. Nothing in this Agreement shall be deemed as preventing any Party from seeking
injunctive relief (or any other provisional remedy) from any court having jurisdiction over the
Parties and the subject matter of the dispute as necessary to protect any Party’s name, proprietary
information, trade secrets, know-how or any other proprietary rights. Judgment upon the award may
be entered in any court having jurisdiction, or application may be made to such court for judicial
acceptance of the award and/or an order of enforcement as the case may be. The Parties hereby
consent to the jurisdiction of the state and federal courts in and for California, solely for
purposes of compelling arbitration under this Agreement.

          11.3.4 Certain Approvals Following Santarus Acquisition. Pursuant to Section 10.4.1(e),
Schering may refer certain matters that are subject to JSC or Santarus approval to a neutral
referee under the circumstances specified in such section. In such event, such matters shall be
submitted to arbitration for determination by a single arbitrator selected in accordance with the
rules of the AAA having experience with the consumer package goods industry and sales of OTC
products. Schering shall present its request and reasoning therefor to the arbitrator, and
Santarus’ successor-in-interest shall present its reasons against such request, and the Parties
shall be bound by the decision of such arbitrator as to whether such approval shall be given. The
arbitrator shall determine whether the Competitive Santarus Acquirer has a reasonable basis for
denying approval of the requested matter for the purpose of protecting the Prescription Products
bearing the Santarus Marks outside the Field and in the Territory, taking into account (i) the
reasons articulated for and against the requested approval and (ii) the likelihood and size of
reduction (if any) in the market for Prescription Products bearing the Santarus Marks in the
Territory and outside the Field arising from such approval or action. Any determination subject to
this Section 11.3.4 shall be completed within ninety (90) days from the filing of a notice of a
request for such arbitration.

     11.4 Severability. Should one or several provisions of the Agreement be or become
invalid, then the Parties shall substitute such invalid provisions by valid ones, which in their
economic effect come so close to the invalid provisions that it can be reasonably assumed that the
Parties would have contracted this Agreement with those new provisions. In the event that such
provisions cannot be determined or are legally impermissible, the invalidity of one or

 

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

46

 

several provisions of the Agreement shall not affect the validity of the Agreement as a whole,
unless the invalid provisions are of such essential importance for this Agreement that it is to be
reasonably assumed that the Parties would not have contracted this Agreement without the invalid
provisions.

     11.5 Notices. Any notice required or permitted to be given or sent under this Agreement shall
be hand delivered or sent by express delivery service, certified or registered mail, postage
prepaid, or by facsimile transmission (with written confirmation copy by registered first-class
mail) to the Parties at the addresses and facsimile numbers indicated below.

	 	 	 	 	 
	 

	 	If to Schering:
	 	Schering-Plough Consumer HealthCare

556 Morris Avenue — Building S4

Summit, NJ 07901-1330

Attention: Nancy Miller-Rich, Vice President, Business Development

Facsimile No.: 908-473-1885
	 
	 	 	 	 
	 

	 	Copy to:
	 	Schering Corporation

2000 Galloping Hill Road

Kenilworth, New Jersey 07033-0530

Attention: Assistant General Counsel, Business Development and
Global Licensing

Facsimile No.: 908-298-5310
	 
	 	 	 	 
	 

	 	If to Santarus:
	 	Santarus, Inc.

10590 West Ocean Air Drive, Suite 200

San Diego, California 92130

Attention: Gerald T. Proehl, President and CEO

Facsimile No.: 858-314-5701
	 
	 	 	 	 
	 

	 	Copy to:
	 	Santarus, Inc.

10590 West Ocean Air Drive, Suite 200

San Diego, California 92130

Attention: Legal Affairs Department

Facsimile No.: 858-314-5702

     Any such notice shall be deemed to have been received on the date actually received. Either
Party may change its address or its facsimile number by giving the other Party written notice,
delivered in accordance with this Section.

     11.6 Entire Agreement. This Agreement constitutes the entire Agreement between the Parties
with respect to its subject matter and supersedes all previous Agreements, whether written or oral.
Confidential Information exchanged by the Parties pursuant to the Mutual Confidentiality Agreement
dated November 29, 2005 between Schering and Santarus shall be deemed Confidential Information
pursuant to this Agreement and subject to the obligations of non-use and non-disclosure set forth
herein. This Agreement shall not be changed or modified orally, but only by an instrument in
writing signed by both Parties.

     11.7 Attorneys Fees. In any action on or concerning this Agreement, including without
limitation arbitration under Section 11.3.3, [***].

     11.8 Patent Marking. Schering and its Affiliates and Sublicensees shall mark all Licensed
Products made, used or sold under the terms of this Agreement, or their containers, in

 

			
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and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

47

 

accordance with the applicable patent marking laws of the country in which such Licensed
Product is sold.

     11.9 Waiver. No waiver by any Party of any default, misrepresentation, or breach hereunder
shall be deemed to extend to any prior or subsequent default, misrepresentation or breach or affect
in any way any rights arising by virtue of any prior or subsequent such occurrence. No delay or
failure on the part of any Party in exercising any rights under this Agreement or enforcing any
waiver as to a particular default or other matter shall impair any such right or be construed so as
to constitute a waiver of such Party’s rights to the future enforcement of such rights under this
Agreement, nor operate to bar the exercise or enforcement thereof at any time or times thereafter.

     11.10 Independent Relationship. Nothing in this Agreement shall be deemed to create an
employment, agency, joint venture or partnership relationship between the Parties hereto or any of
their respective Affiliates, agents or employees, or any other legal arrangement that would impose
liability upon one Party for the act or failure to act of the other Party. Neither Party shall
have any power to enter into any contracts or commitments or to incur any liabilities in the name
of, or on behalf of, the other Party, or to bind the other Party in any respect whatsoever.

     11.11 Third-Party Beneficiaries. This Agreement is not intended to confer any rights or
remedies upon any person or entity that is not a Party to this Agreement.

     11.12 HSR Act. The Parties shall each, as promptly as practicable after signature of this
Agreement, file or cause to be filed with the U.S. Federal Trade Commission any notifications
required to be filed under the HSR Act regarding the transactions contemplated hereby. From and
after the date of execution of this Agreement, the Parties shall use commercially reasonable
efforts to respond promptly to any requests for additional information made by either of such
agencies, and to cause the waiting period under the HSR Act to terminate or expire at the earliest
possible date after the date of filing. If the waiting period under the HSR Act has not expired or
terminated within ninety (90) days after the date of execution of this Agreement, then either Party
may thereafter terminate this Agreement upon written notice to the other, provided that such notice
is given while such waiting period remains unexpired and not terminated. Each Party will use its
commercially reasonable efforts to ensure that its representations and warranties set forth in this
Agreement remain true and correct at and as of the Effective Date as if such representations and
warranties were made at and as of the Effective Date and will promptly notify the other Party of
any events occurring prior to the Effective Date that affect its obligations hereunder.

     11.13 No Strict Construction. This Agreement has been prepared jointly and shall not be
strictly construed against any Party

     11.14 Headings. The captions used herein are inserted for convenience of reference only and
shall not be construed to create obligations, benefits, or limitations.

     11.15 Counterparts. This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original, and such counterparts together shall constitute one
agreement.

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

48

 

     IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the date last set
forth below.

	 	 	 	 	 	 	 	 	 	 	 
	SCHERING-PLOUGH HEALTHCARE PRODUCTS, INC.	 	 	 	SANTARUS, INC.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Raul E. Kohan 	 	 	 	By:	 	/s/ Gerald T. Proehl	 	 
	 

	 	 

	 	 	 	 	 	 

	 	 
	Name:

	 	Raul E. Kohan	 	 	 	Name:
	 	Gerald T. Proehl	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Title:

	 	Group Head, Global Specialty Operations	 	 	 	Title:
	 	President and CEO	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Date:

	 	October 17, 2006 	 	 	 	Date:
	 	October 17, 2006	 	 
	 

	 	 	 	 	 	 	 	 	 	 

49

 

EXHIBIT A

POTENTIAL PRODUCT MARKS

	 	 	 	 	 	 	 	 	 
	Potential Product Marks:	 	 	 	Domain Names:	 	 	 	 
	[***]

	 	 	 	[***]
	[***]

	 	 	 	[***]
	[***]

	 	 	 	[***]
	[***]

	 	 	 	[***]
	[***]

	 	 	 	[***]
	[***]

	 	 	 	[***]
	[***]

	 	 	 	[***]
	[***]

	 	 	 	[***]
	[***]

	 	 	 	[***]
	[***]

	 	 	 	[***]
	[***]

	 	 	 	[***]
	[***]

	 	 	 	[***]
	[***]

	 	 	 	[***]

 

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

50

 

EXHIBIT B

SANTARUS PATENTS

	 	 	 	 	 	 	 	 	 
	Title	 	Country	 	Application

Number	 	Status	 	Ownership
	Novel
Substituted
Benzimidazole
Dosage Forms and
Method of Using
Same

	 	US
	 	08/680,376
	 	USPN 5,840,737
	 	Licensed from Univ.
Missouri
	Substituted
Benzimidazole
Dosage Forms and
Method of Using
Same

	 	US
	 	09/481,207
	 	USPN 6,489,346
	 	Licensed from Univ.
Missouri
	Substituted
Benzimidazole
Dosage Forms and
Method of Using
Same

	 	US
	 	10/260,132
	 	USPN 6,780,882
	 	Licensed from Univ.
Missouri
	Substituted
Benzimidazole
Dosage Forms and
Method of Using
Same

	 	US
	 	09/901,942
	 	USPN 6,645,988
	 	Licensed from Univ.
Missouri
	Substituted
Benzimidazole
Dosage Forms and
Method of Using
Same

	 	US
	 	10/054,350
	 	USPN 6,699,885
	 	Licensed from Univ.
Missouri
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]

 

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

51

 

	 	 	 	 	 	 	 	 	 
	Title	 	Country	 	Application 

Number	 	Status	 	Ownership
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]
	 	 	 	 	 	 	 	 

 

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

52

 

EXHIBIT C

INITIAL COMMITTEE REPRESENTATIVES AND ALLIANCE COORDINATORS

The following are each Party’s initial representatives on the Joint Steering Committee:

	 	 	 	 	 	 	 	 	 
	Santarus Representatives	 	 	 	Schering Representatives	 	 	 	 
	[***]

	 	 	 	[***]	 	 	 	 
	[***]

	 	 	 	[***]	 	 	 	 
	[***]

	 	 	 	[***]	 	 	 	 

The following are each Party’s initial representatives on the Development Subcommittee:

	 	 	 	 	 	 	 
	Santarus Representative	 	 	 	Schering Representative	 	 
	[***]

	 	 	 	[***]	 	 
	[***]

	 	 	 	[***]	 	 

The following are each Party’s initial representatives on the Marketing Subcommittee:

	 	 	 	 	 	 	 	 	 
	Santarus Representative	 	 	 	Schering Representative	 	 	 	 
	[***]

	 	 	 	[***]	 	 	 	 
	[***]

	 	 	 	[***]	 	 	 	 

The following are each Party’s initial Alliance Coordinators:

	 	 	 	 	 	 	 	 	 
	Santarus Alliance Coordinator	 	 	 	Schering Alliance Coordinator	 	 	 	 
	[***]

	 	 	 	[***]	 	 	 	 

 

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

53

 

EXHIBIT D

TYPICAL SP MARKETING PLAN TABLE OF CONTENTS

[***]

 

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

54

 

EXHIBIT E

PLANNED SP DEVELOPMENT PLAN OUTLINE FOR OTC DEVELOPMENT OF ZEGERID
®

[***]

 

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

55exv10w1

 

Exhibit 10.1

EXECUTION COPY

$2,500,000,000 Five-Year Revolving Credit Agreement

dated as of

October 13, 2006

among

INTERNATIONAL LEASE FINANCE CORPORATION,

THE BANKS (as defined herein)

and

CITICORP USA, INC.,

as
Administrative Agent

CITIGROUP GLOBAL MARKETS INC.,

as
Sole Lead Arranger and Book Manager

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page	 
	SECTION 1. CERTAIN DEFINITIONS
	 	 	1	 
	Section 1.1. Terms Generally
	 	 	1	 
	Section 1.2. Specific Terms
	 	 	1	 
	 
	 	 	 	 
	SECTION 2. BID LOANS AND BID NOTES
	 	 	12	 
	Section 2.1. Making of Bid Loans
	 	 	12	 
	Section 2.2. Procedure for Bid Loans
	 	 	12	 
	Section 2.3. Funding of Bid Loans
	 	 	14	 
	 
	 	 	 	 
	SECTION 3. COMMITTED LOANS AND NOTES
	 	 	14	 
	Section 3.1. Agreement to Make Committed Loans
	 	 	14	 
	Section 3.2. Procedure for Committed Loans
	 	 	14	 
	Section 3.3. Maturity of Committed Loans
	 	 	16	 
	 
	 	 	 	 
	SECTION 4. INTEREST AND FEES
	 	 	16	 
	Section 4.1. Interest Rates
	 	 	16	 
	Section 4.2. Interest Payment Dates
	 	 	16	 
	Section 4.3. Setting and Notice of Committed Loan Rates
	 	 	17	 
	Section 4.4. Facility Fee
	 	 	17	 
	Section 4.5. Utilization Fee
	 	 	17	 
	Section 4.6. Agent’s Fees
	 	 	18	 
	Section 4.7. Computation of Interest and Fees
	 	 	18	 
	 
	 	 	 	 
	SECTION 5. REDUCTION OR TERMINATION OF THE COMMITMENTS; REPAYMENT; PREPAYMENTS
	 	 	18	 
	Section 5.1. Voluntary Termination or Reduction of the Commitments
	 	 	18	 
	Section 5.2. Voluntary Prepayments
	 	 	18	 
	 
	 	 	 	 
	SECTION 6. MAKING AND PRORATION OF PAYMENTS; SET-OFF; TAXES
	 	 	19	 
	Section 6.1. Making of Payments
	 	 	19	 
	Section 6.2. Pro Rata Treatment; Sharing
	 	 	19	 
	Section 6.3. Set-off
	 	 	20	 
	Section 6.4. Taxes, etc.
	 	 	20	 
	 
	 	 	 	 
	SECTION 7. INCREASED COSTS AND SPECIAL PROVISIONS FOR ABSOLUTE RATE LOANS AND LIBOR RATE LOANS
	 	 	23	 
	Section 7.1. Increased Costs
	 	 	23	 
	Section 7.2. Basis for Determining Interest Rate Inadequate or Unfair
	 	 	24	 
	Section 7.3. Changes in Law Rendering Certain Loans Unlawful
	 	 	25	 
	Section 7.4. Funding Losses
	 	 	25	 
	Section 7.5. Discretion of Banks as to Manner of Funding
	 	 	26	 
	Section 7.6. Conclusiveness of Statements; Survival of Provisions
	 	 	26	 
	 
	 	 	 	 
	SECTION 8. REPRESENTATIONS AND WARRANTIES
	 	 	26	 
	 
	 	 	 	 
	 i

 

 

	 	 	 	 	 
	 	 	Page	 
	Section 8.1. Organization, etc.
	 	 	26	 
	Section 8.2. Authorization; Consents; No Conflict
	 	 	26	 
	Section 8.3. Validity and Binding Nature
	 	 	27	 
	Section 8.4. Financial Statements
	 	 	27	 
	Section 8.5. Litigation and Contingent Liabilities
	 	 	27	 
	Section 8.6. Employee Benefit Plans
	 	 	27	 
	Section 8.7. Investment Company Act
	 	 	28	 
	Section 8.8. Regulation U
	 	 	28	 
	Section 8.9. Information
	 	 	28	 
	Section 8.10. Compliance with Applicable Laws, etc.
	 	 	28	 
	Section 8.11. Insurance
	 	 	28	 
	Section 8.12. Taxes
	 	 	29	 
	Section 8.13. Use of Proceeds
	 	 	29	 
	Section 8.14. Pari Passu
	 	 	29	 
	 
	 	 	 	 
	SECTION 9. COVENANTS
	 	 	29	 
	Section 9.1. Reports, Certificates and Other Information
	 	 	29	 
	Section 9.2. Existence
	 	 	31	 
	Section 9.3. Nature of Business
	 	 	31	 
	Section 9.4. Books, Records and Access
	 	 	31	 
	Section 9.5. Insurance
	 	 	31	 
	Section 9.6. Repair
	 	 	31	 
	Section 9.7. Taxes
	 	 	31	 
	Section 9.8. Compliance
	 	 	32	 
	Section 9.9. Sale of Assets
	 	 	32	 
	Section 9.10. Consolidated Indebtedness to Consolidated Tangible Net Worth Ratio
	 	 	32	 
	Section 9.11. Fixed Charge Coverage Ratio
	 	 	32	 
	Section 9.12. Consolidated Tangible Net Worth
	 	 	32	 
	Section 9.13. Restricted Payments
	 	 	32	 
	Section 9.14. Liens
	 	 	33	 
	Section 9.15. Use of Proceeds
	 	 	34	 
	 
	 	 	 	 
	SECTION 10. CONDITIONS TO LENDING
	 	 	34	 
	Section 10.1. Conditions Precedent to All Loans
	 	 	35	 
	Section 10.2. Conditions to the Availability of the Commitments
	 	 	35	 
	 
	 	 	 	 
	SECTION 11. EVENTS OF DEFAULT AND THEIR EFFECT
	 	 	36	 
	Section 11.1. Events of Default
	 	 	36	 
	Section 11.2. Effect of Event of Default
	 	 	38	 
	 
	 	 	 	 
	SECTION 12. THE AGENT
	 	 	38	 
	Section 12.1. Authorization
	 	 	38	 
	Section 12.2. Indemnification
	 	 	39	 
	Section 12.3. Action on Instructions of the Required Banks
	 	 	39	 
	Section 12.4. Payments
	 	 	39	 
	Section 12.5. Exculpation
	 	 	40	 
	Section 12.6. Credit Investigation
	 	 	41	 
	 ii

 

 

	 	 	 	 	 
	 	 	Page	 
	Section 12.7. CUSA and Affiliates
	 	 	41	 
	Section 12.8. Resignation
	 	 	41	 
	Section 12.9. The Register; the Notes
	 	 	42	 
	 
	 	 	 	 
	SECTION 13. GENERAL
	 	 	42	 
	Section 13.1. Waiver; Amendments
	 	 	42	 
	Section 13.2. Notices
	 	 	43	 
	Section 13.3. Computations
	 	 	45	 
	Section 13.4. Assignments; Participations
	 	 	45	 
	Section 13.5. Costs, Expenses and Taxes
	 	 	48	 
	Section 13.6. Indemnification
	 	 	49	 
	Section 13.7. Regulation U
	 	 	49	 
	Section 13.8. Extension of Termination Dates; Removal of Banks; Substitution
of Banks
	 	 	49	 
	Section 13.9. Captions
	 	 	52	 
	Section 13.10. Governing Law; Severability
	 	 	52	 
	Section 13.11. Counterparts; Effectiveness
	 	 	52	 
	Section 13.12. Further Assurances
	 	 	52	 
	Section 13.13. Successors and Assigns
	 	 	52	 
	Section 13.14. Waiver of Jury Trial
	 	 	52	 
	Section 13.15. No Fiduciary Relationship
	 	 	53	 
	Section 13.16. USA PATRIOT Act
	 	 	53	 
	 iii

 

 

SCHEDULES AND EXHIBITS

	 	 	 
	Schedule I

	 	Schedule of Banks (Sections 1.2, 3.1 and 13.8)
	Schedule II

	 	Fees and Margins (Sections 1.2, 4.4, 4.5 and 4.6)
	Schedule III

	 	Address for Notices (Section 13.2)
	Exhibit A

	 	Form of Notice of Competitive Bid Borrowing (Sections 1.2 and 2.2)
	Exhibit B

	 	Form of Bid (Sections 1.2 and 2.2)
	Exhibit C

	 	Form of Committed Loan Request (Sections 1.2 and 3.2)
	Exhibit D

	 	Form of Bid Note (Sections 1.2 and 2.4)
	Exhibit E

	 	Form of Committed Note (Sections 1.2 and 3.4)
	Exhibit F

	 	Fixed Charge Coverage Ratio 12/31/03 (Sections 1.2 and 9.11)
	Exhibit G

	 	Form of Opinion of Counsel for the Company (Section 10.2.5)
	Exhibit H

	 	Form of Opinion of the General Counsel of the Company (Section 10.2.5)
	Exhibit I

	 	Form of Assignment and Assumption Agreement (Section 13.4.1)
	Exhibit J

	 	Form of Request for Extension of Termination Date (Section 13.8)

 

 

FIVE-YEAR REVOLVING CREDIT AGREEMENT

          FIVE-YEAR REVOLVING CREDIT AGREEMENT (this “Agreement”), dated as of October 13, 2006,
among INTERNATIONAL LEASE FINANCE CORPORATION, a California corporation (herein called the
“Company”), the financial institutions listed on the signature pages hereof (herein,
together with their respective successors and assigns, collectively called the “Banks” and
individually each called a “Bank”) and CITICORP USA, INC. (herein, in its individual
corporate capacity, together with its successors and assigns, called “CUSA”), as
administrative agent for the Banks (herein, in such capacity, together with its successors and
assigns in such capacity, called the “Agent”).

W I T N E S S E T H:

          WHEREAS, the Company has requested the Banks to lend up to $2,500,000,000 to the Company on a
five year revolving basis for general corporate purposes;

          NOW, THEREFORE, in consideration of the premises and the mutual agreements herein contained,
the parties hereto agree as follows:

          SECTION 1. CERTAIN DEFINITIONS.

          Section 1.1. Terms Generally. The definitions ascribed to terms in this Section 1
and elsewhere in this Agreement shall apply equally to both the singular and plural forms of the
terms defined. Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words “include”, “includes” and “including” shall be
deemed to be followed by the phrase “without limitation”. The words “hereby”, “herein”, “hereof”,
“hereunder” and words of similar import refer to this Agreement as a whole (including any exhibits
and schedules hereto) and not merely to the specific section, paragraph or clause in which such
word appears. All references herein to Sections, Exhibits and Schedules shall be deemed references
to Sections of and Exhibits and Schedules to this Agreement unless the context shall otherwise
require.

          Section 1.2. Specific Terms. When used herein, the following terms shall have the
following meanings:

          “Absolute Rate” means a rate of interest per annum, expressed as a percentage to four
decimal places and set forth in a Bid for a particular Bid Loan amount and a particular Loan
Period.

          “Absolute Rate Loan” means any Loan which bears interest at an Absolute Rate.

          “Affiliate” means, with respect to any Person, any other Person directly or indirectly
controlling, controlled by, or under direct or indirect common control with such Person. A Person
shall be deemed to control another Person if such first Person possesses, directly or indirectly,
the power to direct or cause the direction of the management and policies of such other Person,
whether through ownership of stock, by contract or otherwise.

 

 

 -2-

          “Agent” — see Preamble.

          “Aggregate Commitment” means $2,500,000,000, as reduced by any reduction in the
Commitments made from time to time pursuant to Section 5.1 or Section 13.8.

          “Agreement” — see Preamble.

          “AIG” means American International Group, Inc., a Delaware corporation.

          “Assignee” — see Section 13.4.1.

          “Authorized Officer” of the Company means any of the Chairman of the Board, the
President, the Vice Chair and Chief Financial Officer, the Treasurer, the Controller and the
Assistant Controller of the Company.

          “Available Commitment” — see Section 2.2(a).

          “Bank” — see Preamble.

          “Bank Parties” — see Section 13.6.

          “Base LIBOR” means, with respect to any Loan Period for a LIBOR Rate Loan, (a) the
rate per annum for Dollar deposits approximately equal to the principal amount of the LIBOR Rate
Loans for which LIBOR is being determined and with maturities comparable to the Loan Period for
which such rate would apply, which appears on the Telerate Page 3750 (the “Telerate Page”)
at approximately 11:00 A.M., London time, on the day that is two Business Days prior to the first
day of such Loan Period and (b) if no such rate so appears on the Telerate Page 3750, the rate per
annum determined by the Agent to be the arithmetic mean (rounded to the nearest 1/100 of 1% or, if
there is no nearest 1/100 of 1%, to the next higher 1/100 of 1%) of the respective rates of
interest communicated by the Reference Banks to the Agent as the rate at which Dollar deposits are
offered to the Reference Banks by leading banks in the London interbank deposit market at
approximately 11:00 a.m., London time, on the second full Business Day preceding the first day of
such Loan Period in an amount substantially equal to the amount of such LIBOR Rate Loan for such
Reference Banks and for a period equal to such Loan Period.

          “Base Rate” means a fluctuating interest rate per annum, as shall be in effect from
time to time, which rate per annum shall on any day be equal to the higher of (a) the rate of
interest announced publicly by Citibank, N.A. in New York, New York, from time to time, as
Citibank, N.A.’s base rate and (b) the Federal Funds Rate for such day plus 1/2 of 1% per annum.

          “Base Rate Loan” means any Loan which bears interest at the Base Rate.

          “Bid” means one or more offers by a Bank to make one or more Bid Loans, submitted to
the Agent by telephone no later than the Submission Deadline and promptly

Credit Agreement

 

-3-

confirmed in writing on the same day on a duly completed and executed form substantially
similar to Exhibit B, personally delivered or transmitted by facsimile to the Agent.

          “Bid Borrowing” — see Section 2.2(a).

          “Bid Loan” means a Loan in Dollars that is an Absolute Rate Loan or a LIBOR Rate Loan
made pursuant to Section 2.

          “Bid Note” means a promissory note of the Company, substantially in the form of
Exhibit D, duly completed, evidencing Bid Loans made to the Company, as such note may be amended,
modified or supplemented or supplanted pursuant to Section 13.4.1 from time to time.

          “Business Day” means any day of the year on which banks are open for commercial
banking business in the City of New York and Los Angeles and, if the applicable Business Day
relates to the determination of LIBOR for any LIBOR Rate Loan, any such Business Day on which
dealings in deposits in Dollars are transacted in the London interbank market.

          “Capitalized Lease” means any lease under which any obligations of the lessee are, or
are required to be, capitalized on a balance sheet of the lessee in accordance with generally
accepted accounting principles in the United States of America.

          “Capitalized Rentals” means, as of the date of any determination, the amount at which
the obligations of the lessee, due and to become due under all Capitalized Leases under which the
Company or any Subsidiary is a lessee, are reflected as a liability on a consolidated balance sheet
of the Company and its Subsidiaries.

          “Closing Date” – see Section 10.2.

          “Code” means the Internal Revenue Code of 1986, as amended.

          “Commitments” means the Banks’ commitments to make Committed Loans hereunder; and
“Commitment” as to any Bank means the amount set forth opposite such Bank’s name on
Schedule I (as reduced in accordance with Section 5.1, or as periodically revised in accordance
with Section 13.4 or Section 13.8).

          “Committed Loan” means a Loan in Dollars that is a Base Rate Loan or LIBOR Rate Loan
made pursuant to Section 3.

          “Committed Loan Request” — see Section 3.2(a).

          “Committed Note” means a promissory note of the Company, substantially in the form of
Exhibit E, duly completed, evidencing Committed Loans to the Company, as such note may be amended,
modified or supplemented or supplanted pursuant to Section 13.4.1 from time to time.

Credit Agreement

 

-4-

          “Company” — see Preamble.

          “Consolidated Indebtedness” means, as of the date of any determination, the total
amount of Indebtedness less the amount of current and deferred income taxes and rentals received in
advance of the Company and its Subsidiaries determined on a consolidated basis in accordance with
generally accepted accounting principles in the United States of America, and excluding (i) the
amount that is (a) the aggregate amount outstanding of Hybrid Capital Securities multiplied
by (b) the Hybrid Capital Securities Percentage, and (ii) adjustments in relation to
Indebtedness denominated in any currency other than Dollars and any related derivative liability,
in each case to the extent arising from currency fluctuations (such exclusions to apply only to the
extent the resulting liability is hedged by the Company or such Subsidiary).

          “Consolidated Tangible Net Assets” means, as of the date of any determination, the
total amount of assets (less depreciation and valuation reserves and other reserves and items
deductible from the gross book value of specific asset amounts under generally accepted accounting
principles) which under generally accepted accounting principles would be included on a balance
sheet of the Company and its Subsidiaries, after deducting therefrom (i) all liability items except
Indebtedness (whether incurred, assumed or guaranteed) for borrowed money maturing by its terms
more than one year from the date of creation thereof or which is extendible or renewable at the
sole option of the obligor in such manner that it may become payable more than one year from the
date of creation thereof, shareholder’s equity and reserves for deferred income taxes and (ii) all
good will, trade names, trademarks, patents, unamortized debt discount and expense and other like
intangibles, which in each case would be so included on such balance sheet.

          “Consolidated Tangible Net Worth” means, as of the date of any determination, the
total of shareholders’ equity (including capital stock, additional paid-in capital, the amount that
is (a) the aggregate amount outstanding of Hybrid Capital Securities multiplied by (b) the
Hybrid Capital Securities Percentage, and retained earnings after deducting treasury stock), less
the sum of the total amount of goodwill, organization expenses, unamortized debt issue costs
(determined on an after-tax basis), deferred assets other than prepaid insurance and prepaid taxes,
the excess of cost of shares acquired over book value of related assets, surplus resulting from any
revaluation write-up of assets subsequent to December 31, 2002 and such other assets as are
properly classified as intangible assets, all determined in accordance with generally accepted
accounting principles in the United States of America consolidating the Company and its
Subsidiaries.

          “Covered Taxes” means all Taxes, including all liabilities (including, without
limitation, any penalties, interest and other additions to tax) with respect thereto, other than
the following Taxes, including all liabilities (including, without limitation, any penalties,
interest and other additions to tax) with respect thereto: (i) Taxes imposed on the net income or
capital of the Agent, a Bank, Assignee or Participant under this Agreement and franchise taxes
imposed in lieu thereof (including without limitation branch profits taxes, minimum taxes and taxes
computed under alternative methods, at least one of which is based on net income (collectively
referred to as “net income taxes”)) by (A) the jurisdiction under the laws of which such Agent,
Bank, Assignee or Participant under this Agreement is organized or resident for tax purposes or any

Credit Agreement

 

-5-

political subdivision thereof or (B) the jurisdiction of such Agent, Bank, Assignee or
Participant’s applicable lending office or any political subdivision thereof or (C) any
jurisdiction with which such Agent, Bank, Assignee or Participant has any present or former
connection (other than solely by virtue of being a Bank under this Agreement), (ii) any Taxes to
the extent that they are in effect and would apply to a payment to such Agent, Bank, Assignee or
Participant as of the date of a change in the jurisdiction of such Agent, Bank, Assignee or
Participant’s applicable lending office or (iii) any Taxes that would not have been imposed but for
(A) the failure or unreasonable delay by such Agent, Bank, Assignee or Participant, as applicable,
to complete, provide, or file and update or renew, any application forms, certificates, documents
or other evidence required from time to time, properly completed and duly executed, to qualify for
any applicable exemption from or reduction of Taxes, including, without limitation, the
certificates, documents or other evidence required under Sections 6.4(b), 6.4(c) and 6.4(e) (unless
such failure or delay results from a change in applicable law after the Closing Date or the date of
the applicable agreement pursuant to which such Assignee or Participant, as the case may be,
acquires an interest under this Agreement, which precludes such Agent, Bank, Assignee or
Participant, as applicable, from qualifying for such exemption or reduction) or (B) the gross
negligence or willful misconduct of such Agent, Bank, Assignee or Participant.

          “CUSA” – see Preamble.

          “Dollar” and “$” refer to the lawful money of the United States of America.

          “ECA Financing” means any subsidized financing of the acquisition of Airbus Industrie
aircraft, the repayment obligations of which will be supported by guaranties issued by certain
European government export credit agencies (the European Credit Agency Export Finance Program) and
a Company Guaranty and a pledge of the assets of (including any rights to or interests in any
reserve or security deposit held by) each such Wholly-owned Subsidiary.

          “Eligible Assignee” means (i) any Bank, and any Affiliate of any Bank and (ii)(a) a
commercial bank organized under the laws of the United States or any state thereof, (b) a savings
and loan association or savings bank organized under the laws of the United States or any state
thereof, (c) a commercial bank organized under the laws of any other country or a political
subdivision thereof; provided that (1) such bank is acting through a branch or agency
located in the United States or (2) such bank organized under the laws of a country that is a
member of the Organization for Economic Cooperation and Development or a political subdivision of
such country and (d) a finance company, insurance company, mutual fund, leasing company or other
financial institution or fund (whether a corporation, partnership or other entity) which is engaged
in making, purchasing or otherwise investing in commercial loans in the ordinary course of its
business, and having total assets in excess of $150,000,000.

          “ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

          “ERISA Affiliate” means any corporation, trade or business that is, along with the
Company or any Subsidiary, a member of a controlled group of corporations or a controlled

Credit Agreement

 

-6-

group of trades or businesses, as described in sections 414(b) and 414(c), respectively, of
the Code or Section 4001 of ERISA.

          “Eurodollar Reserve Percentage” means for any day in any Loan Period for any LIBOR
Rate Loan that percentage in effect on such day as prescribed by the Board of Governors of the
Federal Reserve System (or any successor thereto) or other U.S. government agency for determining
the reserve requirement (including, without limitation, any marginal, basic, supplemental or
emergency reserves) for a member bank of the Federal Reserve System in New York City with deposits
exceeding one billion dollars in respect of eurocurrency funding liabilities. LIBOR shall be
adjusted automatically on and as of the effective date of any change in the Eurodollar Reserve
Percentage.

          “Event of Default” means any of the events described in Section 11.1.

          “Eximbank” means the Export-Import Bank of the United States.

          “Existing Litigation” — see Section 10.1.3.

          “FASB 13” means the Statement of Financial Accounting Standards No. 13 (Accounting for
Leases) as in effect on the date hereof.

          “Federal Funds Rate” means, for any period, a fluctuating interest rate per annum
equal for each day during such period to the weighted average of the rates on overnight Federal
funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as
published for such day (or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is
a Business Day, the average of the quotations for such day on such transactions received by the
Agent from three Federal funds brokers of recognized standing selected by it.

          “Fixed Charge Coverage Ratio” on the last day of any quarter of any fiscal year of the
Company means the ratio for the period of four fiscal quarters ending on such day of earnings to
combined fixed charges and preferred stock dividends referred to in Paragraph (d)(1) of Item 503 of
Regulation S-K of the Securities and Exchange Commission, as amended from time to time, and
determined pursuant to Instructions to paragraph 503(d) of such Item 503 with the Company as
“registrant” (such ratio for the four fiscal quarters ended December 31, 2005 is attached hereto as
Exhibit F); provided, however, that if the Required Banks in their reasonable
discretion determine that amendments to Regulation S-K subsequent to the date hereof substantially
modify the provisions of such Item 503, “Fixed Charge Coverage Ratio” shall have the meaning
determined by this definition without regard to any such amendments.

          “Funding Date” means the date on which any Loan is scheduled to be disbursed.

          “Funding Office” means, with respect to any Bank, any office or offices of such Bank
or Affiliate or Affiliates of such Bank through which such Bank shall fund or shall have funded any
Loan. A Funding Office may be, at such Bank’s option, either a domestic or foreign office of such
Bank or a domestic or foreign office of an Affiliate of such Bank.

Credit Agreement

 

-7-

          “Governmental Authority” means any nation or government, any state or other political
subdivision thereof and any entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.

          “Guaranties” by any Person means, without duplication, all obligations (other than
endorsements in the ordinary course of business of negotiable instruments for deposit or
collection) of such Person guaranteeing or in effect guaranteeing any Indebtedness, dividend or
other obligation of any other Person (the “Primary Obligor”) in any manner, whether
directly or indirectly, including, without limitation, all obligations incurred through an
agreement, contingent or otherwise, by such Person: (a) to purchase such Indebtedness or obligation
or any property or assets constituting security therefor, (b) to advance or supply funds (i) for
the purchase or payment of such Indebtedness or obligation or (ii) to maintain working capital or
other balance sheet condition or otherwise to advance or make available funds for the purchase or
payment of such Indebtedness or obligation, (c) to lease property or to purchase securities or
other property or services primarily for the purpose of assuring the owner of such Indebtedness or
obligation of the ability of the Primary Obligor to make payment of the Indebtedness or obligation
or (d) otherwise to assure the owner of the Indebtedness or obligation of the Primary Obligor
against loss in respect thereof; provided, however, that the obligation described
in clause (c) shall not include (i) obligations of a buyer under an agreement with a seller to
purchase goods or services entered into in the ordinary course of such buyer’s and seller’s
businesses unless such agreement requires that such buyer make payment whether or not delivery is
ever made of such goods or services and (ii) remarketing agreements where the remaining debt on an
aircraft does not exceed the aircraft’s net book value, determined in accordance with industry
standards, except that clause (c) shall apply to the amount of remaining debt under a remarketing
agreement that exceeds the net book value of the aircraft. For the purposes of all computations
made under this Agreement, a Guaranty in respect of any Indebtedness for borrowed money shall be
deemed to be Indebtedness equal to the principal amount of such Indebtedness for borrowed money
which has been guaranteed, and a Guaranty in respect of any other obligation or liability or any
dividend shall be deemed to be Indebtedness equal to the maximum aggregate amount of such
obligation, liability or dividend.

          “Hybrid Capital Securities” means any hybrid capital securities issued by the Company
from time to time whose proceeds are accorded a percentage of equity treatment by one or more
Rating Organizations.

          “Hybrid Capital Securities Percentage” means the greater of (i) 50% and (ii) the
lowest percentage accorded equity treatment for the Company’s Hybrid Capital Securities among the
Rating Organizations, as determined by such Rating Organizations from time to time.

          “Indebtedness” of any Person means and includes, without duplication, all obligations
of such Person which in accordance with generally accepted accounting principles in the United
States of America shall be classified upon a balance sheet of such Person as liabilities of such
Person, and in any event shall include all:

Credit Agreement

 

-8-

     (a) obligations of such Person for borrowed money or which have been incurred in
connection with the acquisition of property or assets (other than security and other
deposits on flight equipment),

     (b) obligations secured by any Lien or other charge upon property or assets owned by
such Person, even though such Person has not assumed or become liable for the payment of
such obligations,

     (c) obligations created or arising under any conditional sale, or other title
retention agreement with respect to property acquired by such Person, notwithstanding the
fact that the rights and remedies of the seller, lender or lessor under such agreement in
the event of default are limited to repossession or sale of property,

     (d) Capitalized Rentals of such Person under any Capitalized Lease,

     (e) obligations evidenced by bonds, debentures, notes or other similar instruments,
and

     (f) Guaranties by such Person, to the extent required pursuant to the definition
thereof.

          “Indemnified Liabilities” — see Section 13.6.

          “LIBOR” means, with respect to any Loan Period the rate per annum (rounded to the
nearest 1/100 of 1% or, if there is no nearest 1/100 of 1%, to the next higher 1/100 of 1%),
determined pursuant to the following formula:

	 	 	 	 	 
	 

	 	LIBOR=
	 	Base LIBOR
	 

	 	 	 	 
	 

	 	 	 	(1 – Eurodollar Reserve Percentage)

          “LIBOR Rate” means (i) with respect to Committed Loans that are LIBOR Rate Loans,
LIBOR plus the applicable rate margin set forth for LIBOR Rate Loans in the row entitled
“Margins” on Schedule II and (ii) with respect to Bid Loans that are LIBOR Rate Loans, LIBOR
plus or minus the rate margin set forth in a Bid for a particular Bid Loan amount
and a particular Loan Period.

          “LIBOR Rate Loan” means any Loan which bears interest at a LIBOR Rate.

          “Lien” means any mortgage, pledge, lien, security interest or other charge,
encumbrance or preferential arrangement, including the retained security title of a conditional
vendor or lessor. For avoidance of doubt, the parties hereto acknowledge that the filing of a
financing statement under the Uniform Commercial Code does not, in and of itself, give rise to a
Lien.

          “Litigation Actions” means all litigation, claims and arbitration proceedings,
proceedings before any Governmental Authority or investigations which are pending or, to the
knowledge of the Company, threatened against, or affecting, the Company or any Subsidiary.

Credit Agreement

 

-9-

          “Loan Period” means (i) with respect to any Absolute Rate Loan, the period commencing
on such Loan’s Funding Date and ending not less than 14 days thereafter nor more than 6 months
thereafter as specified in the Bid Loan Request related to such Bid Loan and (ii) with respect to
any LIBOR Rate Loan, the period commencing on such Loan’s Funding Date and ending 1, 2, 3 or 6
months thereafter as selected by the Company pursuant to Section 3.2(a) or specified in the Notice
of Competitive Bid Borrowing, as the case may be; provided, however, that:

     (a) if a Loan Period would otherwise end on a day which is not a Business Day, such
Loan Period shall end on the next succeeding Business Day (unless, in the case of a LIBOR
Rate Loan, such next succeeding Business Day would fall in the next succeeding calendar
month, in which case such Loan Period shall end on the next preceding Business Day),

     (b) in the case of a Loan Period for any LIBOR Rate Loan, if there exists no day
numerically corresponding to the day such Loan was made in the month in which the last day
of such Loan Period would otherwise fall, such Loan Period shall end on the last Business
Day of such month, and

     (c) on the date of the making of any Loan by a Bank, the Loan Period for such Loan
shall not extend beyond the then-scheduled Termination Date for such Bank.

          “Loans” means, collectively, the Bid Loans and the Committed Loans and, individually,
any Bid Loan or Committed Loan.

          “Material Adverse Effect” means (i) any material adverse effect on the business,
properties, condition (financial or otherwise) or operations of the Company and its Subsidiaries,
taken as a whole since any stated reference date or from and after the date of determination, as
the case may be, (ii) any material adverse effect on the ability of the Company to perform its
material obligations hereunder and under the Notes or (iii) any material adverse effect on the
legality, validity, binding effect or enforceability of any material provision of this Agreement or
any Note.

          “Multiemployer Plan” has the meaning assigned to such term in Section 3(37) of ERISA.

          “New Litigation” — see Section 10.1.3.

          “Notes” means, collectively, the Bid Notes and the Committed Notes; and “Note”
means any individual Bid Note or Committed Note.

          “Notice
of Competitive Bid Borrowing” — see Section 2.2(a).

Credit Agreement

 

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          “Notice Office” means the office of CUSA which, as of the date hereof, is located at 2
Penns Way, Suite 200, New Castle, DE 19720, Telecopy Number 302-894-6005; Telephone 302-894-6120.

          “Participant” — see Section 13.4.2.

          “Payment Office” means the office of the Agent which, as of the date hereof, is at 2
Penns Way, Suite 200, New Castle, DE 19720, Account Number: 36852248.

          “PBGC” means the Pension Benefit Guaranty Corporation and any entity succeeding to any
or all of its functions under ERISA.

          “Percentage” means as to any Bank the ratio, expressed as a percentage, that such
Bank’s Commitment as set forth opposite such Bank’s name on Schedule I, as periodically revised in
accordance with Section 13.4 or 13.8, bears to the Aggregate Commitment or, if the Commitments have
been terminated, the ratio, expressed as a percentage, that the aggregate principal amount of such
Bank’s outstanding Loans bears to the aggregate principal amount of all outstanding Loans.

          “Person” means an individual or a corporation, partnership, trust, incorporated or
unincorporated association, joint venture, joint stock company, government (or an agency or
political subdivision thereof) or other entity of any kind.

          “Plan” means, at any date, any employee pension benefit plan (as defined in section
3(2) of ERISA) which is subject to Title IV of ERISA (other than a Multiemployer Plan) and to which
the Company or any ERISA Affiliate may have any liability, including any liability by reason of
having been a substantial employer within the meaning of section 4063 of ERISA at any time during
the preceding five years, or by reason of being deemed to be a contributing sponsor under section
4069 of ERISA.

          “Rating Organizations” means the following nationally recognized rating organizations:
Moody’s Investor Service, Standard & Poor’s Ratings Services, a division of The McGraw-Hill
Companies, Inc., and Fitch Ratings, Inc.

          “Reference Banks” means Citibank, N.A., Bank of America, N.A. and The Governor and
Company of the Bank of Scotland.

          “Reportable Event” means an event described in Section 4043(c) of ERISA with respect
to a Plan other than those events as to which the 30-day notice
period is waived under subsection .22, .23, .25, .27 or .28 of PBGC Regulation Section 4043.

          “Required Banks” means Banks having an aggregate Percentage of 51% or more.

          “Significant Subsidiary” means any Subsidiary which is so defined pursuant to Rule
1-02 of Regulation S-X promulgated by the Securities and Exchange Commission.

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          “Submission Deadline” — see Section 2.2(b).

          “Subsidiary” means any Person of which or in which the Company and its other
Subsidiaries own directly or indirectly 50% or more of:

          (a) the combined voting power of all classes of stock having general voting power
under ordinary circumstances to elect a majority of the board of directors of such Person,
if it is a corporation,

          (b) the capital interest or profits interest of such Person, if it is a partnership,
joint venture or similar entity, or

          (c) the beneficial interest of such Person, if it is a trust, association or other
unincorporated organization.

          “Successor Bank” — see Section 13.8(c).

          “Taxes” with respect to any Person means income, excise and other taxes, and all
assessments, imposts, duties and other governmental charges or levies, imposed upon such Person,
its income or any of its properties, franchises or assets by any Governmental Authority.

          “Telerate Page” – see “Base LIBOR”.

          “Terminating Bank” — see Section 13.8(c).

          “Termination Date” means, with respect to any Bank, the earliest to occur of (i)
October 13, 2011 or such later date as may be agreed to by such Bank pursuant to Section 13.8(a),
or if such day is not a Business Day, the next preceding Business Day, (ii) the date on which the
Commitments shall terminate pursuant to Section 11.2 or the Commitments shall be reduced to zero
pursuant to Section 5.1 and (iii) the date specified as such Bank’s Termination Date pursuant to
Section 13.8(b), or, if such day is not a Business Day, the next preceding Business Day; in all
cases, subject to the provisions of Section 13.8(d).

          “Unmatured Event of Default” means any event which if it continues uncured will, with
lapse of time or notice or lapse of time and notice, constitute an Event of Default.

          “Wholly-owned Subsidiary” means any Person of which or in which the Company and its
other Wholly-owned Subsidiaries own directly or indirectly 100% of:

     (a) the issued and outstanding shares of stock (except shares required as directors’
qualifying shares),

     (b) the capital interest or profits interest of such Person, if it is a partnership,
joint venture or similar entity, or

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     (c) the beneficial interest of such Person, if it is a trust, association or other
unincorporated organization.

          SECTION 2. BID LOANS AND BID NOTES.

          Section 2.1. Making of Bid Loans. On the terms and subject to the conditions of this
Agreement, each Bank, severally and for itself alone, may (but is not obligated to) make Bid Loans
to the Company from time to time on or after the date hereof and prior to the date which is the
fourteenth day preceding such Bank’s Termination Date in amounts equal to such Bank’s Bids that
have been accepted as provided in Section 2.2(c); provided, that the aggregate principal
amount of all outstanding Loans shall not at any time exceed the then Aggregate Commitment.

          Section 2.2. Procedure for Bid Loans.

          (a) Bid Loan Request. Whenever the Company desires to incur a competitive bid
borrowing (a “Bid Borrowing”), it shall give the Agent written notice (or telephonic notice
promptly confirmed in writing), such notice to be delivered to the Agent at its Notice Office no
later than 12:00 Noon, New York City time, at least three Business Days prior to any proposed LIBOR
Rate Loan and at least one Business Day prior to any proposed Absolute Rate Loan. Each such notice
shall be substantially in the form of Exhibit A hereto (each a “Notice of Competitive Bid
Borrowing”), and shall specify in each case (i) the date of such proposed Bid Borrowing (which
shall be a Business Day), (ii) the aggregate amount of the proposed Bid Borrowing, (iii) whether
the proposed Bid Borrowing is to be an Absolute Rate Loan or a LIBOR Rate Loan and the Loan Period,
(iv) the maturity date for repayment of each Bid Loan to be made as part of such borrowing (which
maturity date shall not be earlier than one month after the date of any proposed LIBOR Rate Loan or
14 days after the date of any proposed Absolute Rate Loan nor later than the earliest to occur of
(x) six months after the date of such proposed Bid Loan, (y) the Termination Date and (z) if the
proposed Bid Loan has an interest rate that is the LIBOR Rate, the last day of the proposed Loan
Period), (v) the interest payment date or dates relating thereto, (vi) the account to which the
proceeds of such Bid Borrowing are to be credited and (vii) any other terms to be applicable to
such Bid Borrowing. The Agent shall promptly give each Bank written notice (or telephonic notice
promptly confirmed in writing) of each such request for a Bid Borrowing received by it from the
Company. Each Notice of Competitive Bid Borrowing shall contemplate Bid Loans in a minimum
aggregate principal amount of $10,000,000 or a higher integral multiple of $1,000,000, not to
exceed, however, the excess of the then Aggregate Commitment over the aggregate principal amount of
all outstanding Loans, calculated as of the relevant Funding Date, assuming that the Company will
pay, when due, all Loans maturing on or prior to such Funding Date (the “Available
Commitment”).

          (b) Bidding Procedure. Each Bank shall, if in its sole discretion it elects to do
so, irrevocably offer to make one or more Bid Loans to the Company as part of such proposed Bid
Borrowing at a rate or rates of interest specified by such Bank in its sole discretion and
determined by such Bank independently of each other Bank, by notifying by telephone confirmed in
writing to the Agent at its Notice Office (which shall give prompt notice thereof to the Company),
before 10:00 a.m., New York City time, on the date (the “Submission Deadline”)
that is (x) in the case of a proposed Absolute Rate Loan, the same day as the date of such
proposed Bid Loan and (y) in the case of a proposed LIBOR Rate Loan, two Business Days

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before the
date of such proposed Bid Loan. Each Bid shall be substantially in the form of Exhibit B (each a
“Bid”), and shall specify in each case (i) the Loan Period, (ii) the minimum amount and
maximum amount of each Bid Loan that such Bank would be willing to make as part of such proposed
Bid Borrowing (which amounts may, subject to the proviso in Section 2.1, exceed such Bank’s
Commitment), (iii) the rate or rates of interest therefor and (iv) such Bank’s lending office with
respect to such Bid Loan; provided, that if the Agent in its capacity as a Bank shall, in
its sole discretion, elect to make any such offer, it shall notify the Company of such offer before
8:30 a.m., New York City time, on the Submission Deadline.

          (c) Acceptance of Bids. The Company shall, in turn, before 10:30 a.m., New York City
time, on the Submission Deadline, either:

     (i) cancel such proposed Bid Borrowing by giving the Agent notice to that effect, or

     (ii) accept (such acceptance to be irrevocable) one or more of the offers made by any
Bank or Banks pursuant to clause (b) above by giving notice (in writing or by telephone
confirmed in writing) to the Agent of the amount of each Bid Loan (which amount shall be
equal to or greater than the minimum amount, and equal to or less than the maximum amount,
notified to the Company by the Agent on behalf of such Bank for such Bid Borrowing pursuant
to clause (b) above) to be made by such Bank as part of such Bid Borrowing, and reject any
remaining offers made by any Bank pursuant to clause (b) above by giving the Agent notice to
that effect; provided, that for any maturity date acceptance of offers may only be
made on the basis of ascending Absolute Rates (in the case of an Absolute Rate Loan) or
floating rates (in the case of a LIBOR Rate Loan), in each case commencing with the lowest
rate so offered and only as to offers made in conformity with the terms hereof;
provided, further, however, if offers are made by two or more Banks
at the same rate or rates and acceptance of all such equal offers would result in a greater
principal amount of Bid Loans being accepted than the aggregate principal amount requested
by the Company, the Company shall have the right to accept one or more of such equal offers
in their entirety and reject the other equal offer or offers or to allocate acceptance among
all such equal offers (but giving effect to the minimum and maximum amounts specified for
each such offer pursuant to clause (b) above), as the Company may elect in its sole
discretion. The Company may not accept offers whose aggregate principal amount is greater
than the requested aggregate amount as specified in the related Notice of Competitive Bid
Borrowing subject to the proviso in Section 2.1.

          (d) Cancellation of Bid Borrowing. If the Company notifies the Agent that such
proposed Bid Borrowing is cancelled pursuant to clause (c)(i) above, the Agent shall give prompt
notice thereof to the Banks and such Bid Borrowing shall not be made.

          (e) Notification of Acceptance and Repayment. If the Company accepts one or more of
the offers made by any Bank or Banks pursuant to clause (c)(ii) above, the Agent shall in turn
promptly notify (x) each Bank that has made an offer as described in clause (b) above, of
the date and aggregate amount of such Bid Borrowing and whether or not any offer or offers
made by such Bank pursuant to clause (b) above have been accepted by the Company and (y)

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each Bank
that is to make a Bid Loan as part of such Bid Borrowing, of the amount of each Bid Loan to be made
by such Bank as part of such Bid Borrowing. The Company agrees to repay the principal amount of
each Bid Loan, and pay the interest accrued thereon, in each case in accordance with the terms bid
and accepted as provided herein and, additionally in the case of the payment of interest, in
accordance with Sections 4.1 and 4.2 hereof.

          (f) Reliance. The Agent may rely and act upon notice given by telephone by
individuals reasonably believed by the Agent to be those designated to the Agent by the Company or
by any Bank in writing from time to time, without waiting for receipt of written confirmation
thereof, and the Company hereby agrees to indemnify and hold harmless the Agent from and against
any and all losses, costs, expenses, damages, claims, actions or other proceedings relating to such
reliance.

          Section 2.3. Funding of Bid Loans. No later than 1:00 p.m., New York City time, on
the date specified in each Notice of Competitive Bid Borrowing, each Bank will make available the
Bid Loan, if any, to be made by such Bank as part of the Bid Borrowing requested to be made on such
date in the manner provided below. All amounts shall be made available to the Agent in Dollars and
immediately available funds at the Payment Office of the Agent and the Agent promptly will make
available to the Company at its account specified in the relevant Notice of Competitive Bid
Borrowing the aggregate of the amounts so made available in the type of funds received. Unless the
Agent shall have been notified by any Bank which has submitted a bid pursuant to Section 2.2(b)
prior to the date of the proposed Bid Borrowing that such Bank does not intend to make available to
the Agent its portion, if any, of the Bid Borrowing to be made on such date, the Agent may assume
that such Bank has made such amount available to the Agent on such date of the Bid Borrowing, and
the Agent, in reliance upon such assumption, may (in its sole discretion and without any obligation
to do so) make available to the Company a corresponding amount.

          SECTION 3. COMMITTED LOANS AND NOTES.

          Section 3.1. Agreement to Make Committed Loans. On the terms and subject to the
conditions of this Agreement, each Bank, severally and for itself alone, agrees to make Loans
(herein collectively called “Committed Loans” and individually each called a “Committed
Loan”) on a revolving basis from time to time from the date hereof until such Bank’s
Termination Date in such Bank’s Percentage of such aggregate amounts as the Company may from time
to time request as provided in Section 3.2; provided, that (a) the aggregate principal
amount of all outstanding Committed Loans of any Bank shall not at any time exceed the amount set
forth opposite such Bank’s name on Schedule I (as reduced in accordance with Section 5.1, Section
13.4 or Section 13.8) and (b) the aggregate principal amount of all outstanding Committed Loans of
all Banks plus the aggregate principal amount of all outstanding Bid Loans of all Banks
shall not at any time exceed the then Aggregate Commitment. Within the limits of this Section 3.1,
the Company may from time to time borrow, prepay and reborrow Committed Loans on the terms and
conditions set forth in this Agreement.

          Section 3.2. Procedure for Committed Loans.

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          (a) Committed Loan Requests. The Company shall give the Agent irrevocable telephonic
notice at the Notice Office (promptly confirmed in writing on the same day), not later than 10:30
a.m., New York City time, (i) at least three Business Days prior to the Funding Date in the case of
LIBOR Rate Loans or (ii) on the Funding Date in the case of Base Rate Loans, of each requested
Committed Loan, and the Agent shall promptly advise each Bank thereof and, in the case of a LIBOR
Rate Loan, if the Telerate Page is not available, request each Reference Bank to notify the Agent
of its applicable rate (as contemplated in the definition of LIBOR). Each such notice to the Agent
(a “Committed Loan Request”) shall be substantially in the form of Exhibit C and shall
specify (i) the Funding Date (which shall be a Business Day), (ii) the aggregate amount of the
Loans requested (in an amount permitted under clause (b) below), (iii) whether each Loan shall be a
LIBOR Rate Loan or a Base Rate Loan and (iv) if a LIBOR Rate Loan, the Loan Period therefor
(subject to the limitations set forth in the definition of Loan Period).

          (b) Amount and Increments of Committed Loans. Each Committed Loan Request shall
contemplate Committed Loans in a minimum aggregate amount of $10,000,000 or a higher integral
multiple of $1,000,000, not to exceed in the aggregate (for all requested Committed Loans) the
Available Commitment.

          (c) Funding of Committed Loans.

          (i) Not later than 1:30 p.m., New York City time, on the Funding Date of a Committed Loan,
each Bank shall, subject to this Section 3.2(c), provide the Agent at its Notice Office with
immediately available funds covering such Bank’s Committed Loan (provided, that a Bank’s
obligation to provide funds to the Agent shall be deemed satisfied by such Bank’s delivery to the
Agent at its Notice Office not later than 1:30 p.m., New York City time, of a Federal reserve wire
confirmation number covering the proceeds of such Bank’s Committed Loan) and the Agent shall pay
over such funds to the Company not later than 2:00 p.m., New York City time, on such day if the
Agent shall have received the documents required under Section 10 with respect to such Loan and the
other conditions precedent to the making of such Loan shall have been satisfied not later than
10:00 a.m., New York City time, on such day. If the Agent does not receive such documents or such
other conditions precedent have not been satisfied prior to such time, then (A) the Agent shall not
pay over such funds to the Company, (B) the Company’s Committed Loan Request related to such Loan
shall be deemed cancelled in its entirety, (C) in the case of Committed Loan Requests relative to
LIBOR Rate Loans, the Company shall be liable to each Bank in accordance with Section 7.4 and (D)
the Agent shall return the amount previously provided to the Agent by each Bank on the next
following Business Day.

          (ii) The Company agrees, notwithstanding its previous delivery of any documents required
under Section 10 with respect to a particular Loan, immediately to notify the Agent of any failure
by it to satisfy the conditions precedent to the making of such Loan. The Agent shall be entitled
to assume, after it has received each of the documents required under Section 10 with respect to a
particular Loan, that each of the conditions precedent to the making of such Loan has
been satisfied absent actual knowledge to the contrary received by the Agent prior to the time
of the receipt of such documents. Unless the Agent shall have notified the Banks prior to 10:30

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a.m., New York City time, on the Funding Date of any Loan that the Agent has actual knowledge that
the conditions precedent to the making of such Loan have not been satisfied, the Banks shall be
entitled to assume that such conditions precedent have been satisfied.

          (d) Repayment of Loans. If any Bank is to make a Committed Loan hereunder on a day
on which the Company is to repay (or has elected to prepay, pursuant to Section 5.2) all or any
part of any outstanding Loan held by such Bank, the proceeds of such new Committed Loan shall be
applied to make such repayment and only an amount equal to the positive difference, if any, between
the amount being borrowed and the amount being repaid shall be requested by the Agent to be made
available by such Bank to the Agent as provided in Section 3.2(c).

          Section 3.3. Maturity of Committed Loans. Except for a Base Rate Loan, which shall
mature on the Termination Date, a Committed Loan made by a Bank shall mature on the last day of the
Loan Period applicable to such Committed Loan, but in no event later than the Termination Date for
such Bank.

          SECTION 4. INTEREST AND FEES.

          Section 4.1. Interest Rates. The Company hereby promises to pay interest on the
unpaid principal amount of each Loan for the period commencing on the Funding Date for such Loan
until such Loan is paid in full, as follows:

          (a) if such Loan is a Bid Loan, at a rate per annum equal to the Absolute Rate or the LIBOR
Rate, as applicable, offered by the applicable Bank and accepted by the Company for such Bid Loan;

          (b) if such Loan is a Base Rate Loan, at a rate per annum equal to the Base Rate from time to
time in effect; and

          (c) if such Loan is a Committed Loan that is a LIBOR Rate Loan, at a rate per annum equal to
the LIBOR Rate applicable to the Loan Period for such Loan; provided, however, that
after the maturity of any Loan (whether by acceleration or otherwise), such Loan shall bear
interest on the unpaid principal amount thereof at a rate per annum (calculated on the basis of a
360-day year for the actual number of days involved) equal to the Base Rate from time to time in
effect (but not less than the interest rate in effect for such Loan immediately prior to maturity)
plus 1% per annum.

          Section 4.2. Interest Payment Dates. Except for Base Rate Loans, as to which accrued
interest shall be payable on the last day of each calendar quarter and on the Termination Date,
accrued interest on each Loan shall be payable in arrears on the last day of the Loan Period
therefor and (i) with respect to each LIBOR Rate Loan with a Loan Period of six months, on the day
that is three months after the first day of such Loan Period (or, if there is no day in such third
month numerically
corresponding to such first day of the Loan Period, on the last Business Day of such month)
and (ii) with respect to each Absolute Rate Loan with a Loan Period exceeding 90 days, on the day
that is 90 days after the first day of such Loan Period. After the maturity of any Loan, accrued
interest on such Loan shall be payable on demand. If any interest payment

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date falls on a day that
is not a Business Day, such interest payment date shall be postponed to the next succeeding
Business Day and the interest paid shall cover the period of postponement (except that if the Loan
is a LIBOR Rate Loan and the next succeeding Business Day falls in the next succeeding calendar
month, such interest payment date shall be the immediately preceding Business Day).

          Section 4.3. Setting and Notice of Committed Loan Rates.

          (a) The applicable interest rate for each Committed Loan hereunder shall be determined by the
Agent and notice thereof shall be given by the Agent promptly to the Company and to each Bank.
Each determination of the applicable interest rate by the Agent shall be conclusive and binding
upon the parties hereto in the absence of demonstrable error.

          (b) In the case of LIBOR Rate Loans, each Reference Bank agrees to use its best efforts to
notify the Agent in a timely fashion of its applicable rate after the Agent’s request (if any)
therefor under Section 2.2(a) and Section 3.2(a) (as contemplated in the definition of LIBOR). If
as to any Loan Period the Telerate Page is not available and any one or more of the Reference Banks
is unable or for any reason fails to notify the Agent of its applicable rate by 11:30 a.m., New
York City time, two Business Days before the Funding Date, then the applicable LIBOR Rate shall be
determined on the basis of the rate or rates of which the Agent is given notice by the remaining
Reference Bank or Banks by such time. If the Telerate Page is not available and none of the
Reference Banks notifies the Agent of the applicable rate prior to 11:30 a.m., New York City time,
two Business Days before the Funding Date, then (i) the Agent shall promptly notify the other
parties thereof and (ii) at the option of the Company the Committed Loan Request delivered by the
Company pursuant to Section 3.2(a) with respect to such Funding Date shall be cancelled or shall be
deemed to have specified a Base Rate Loan.

          (c) The Agent shall, upon written request of the Company or any Bank, deliver to the Company
or such Bank a statement showing the computations used by the Agent in determining the interest
rate applicable to any LIBOR Rate Loan.

          Section 4.4. Facility Fee. The Company agrees to pay to the Agent for the accounts
of the Banks pro rata in accordance with their respective Percentages an annual
facility fee computed by multiplying the average daily amount of the Aggregate Commitment (whether
used or unused) by the applicable percentage determined with respect to such facility fee in
accordance with Schedule II hereto. Such fee shall be payable quarterly in arrears on the last
Business Day of March, June, September and December of each year (beginning with the last Business
Day of December, 2006) until the Commitments have expired or have been terminated and on the date
of such expiration or termination (and, in the case of any Terminating Bank, such Bank’s
Termination Date), in each case for the period then ending for which such facility fee has not
previously been paid.

          Section 4.5. Utilization Fee. The Company agrees to pay to the Agent for the
accounts of the Banks pro rata in accordance with their respective Percentages,
during any period that the aggregate outstanding principal amount of the Loans exceeds 33.33% of
the Aggregate Commitment, a utilization fee computed by multiplying the average daily amount of the

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Aggregate Commitment by the applicable percentage determined with respect to such utilization fee
in accordance with Schedule II hereto; provided, that if the then outstanding aggregate
principal amount of Bid Loans exceeds an amount equal to 33.33% of the Aggregate Commitments as
then in effect, then in calculating the aggregate outstanding principal amount of the Loans for
purposes of this Section 4.5 only, the aggregate outstanding principal amount of Loans shall not
include an amount equal to 33.33% of the Aggregate Commitments as then in effect. Accrued
utilization fees shall be due and payable on each date that interest is payable on each such Loan.

          Section 4.6. Agent’s Fees. The Company agrees promptly to pay to the Agent such fees
as may be agreed from time to time by the Company and the Agent.

          Section 4.7. Computation of Interest and Fees. Interest on LIBOR Rate Loans, and
facility and utilization fees shall be computed for the actual number of days elapsed on the basis
of a 360-day year; and interest on Base Rate Loans shall be computed for the actual number of days
elapsed on the basis of a 365/366 day year, as the case may be. The interest rate applicable to
each LIBOR Rate Loan and Base Rate Loan, and (to the extent applicable) after the maturity of any
other type of Loan, the interest rate applicable to such Loan, shall change simultaneously with
each change in the LIBOR Rate or the Base Rate, as applicable.

          SECTION 5. REDUCTION OR TERMINATION OF THE COMMITMENTS; REPAYMENT; PREPAYMENTS.

          Section 5.1. Voluntary Termination or Reduction of the Commitments. The Company may
at any time on at least 5 days’ prior irrevocable notice received by the Agent (which shall
promptly on the same day or on the next Business Day advise each Bank thereof) permanently reduce
the amount of the Commitments (such reduction to be pro rata among the Banks
according to their respective Percentages) to an amount not less than the aggregate principal
amount of all outstanding Loans. Any such reduction shall be in the amount of $5,000,000 or an
integral multiple of $1,000,000 in excess thereof. Concurrently with any such reduction, the
Company shall prepay the principal of any Committed Loans outstanding to the extent that the
aggregate amount of such Loans outstanding shall then exceed the Aggregate Commitment, as so
reduced. The Company may from time to time on like irrevocable notice terminate the Commitments
upon payment in full of all Loans, all interest accrued thereon, all fees and all other obligations
of the Company hereunder; provided, however, that the Company may not at any time
terminate the Commitments if any Bid Loan is outstanding (unless the holder of each such
outstanding Bid Loan has given its prior written consent to the concurrent repayment of such Bid
Loan).

          Section 5.2. Voluntary Prepayments. The Company may voluntarily prepay Loans (other than Bid Loans, which may only be prepaid
with the prior written consent of the holder thereof) without premium or penalty, except as may be
required pursuant to subsection (e) below, in whole or in part; provided, that (a) each
prepayment shall be in an aggregate principal amount of $10,000,000 or an integral multiple of
$1,000,000 in excess thereof, (b) except for the prepayment of the aggregate amount of all Loans
outstanding, no such prepayment shall result in there being less than $10,000,000 in Loans
outstanding in the aggregate, (c) the Company shall give the Agent at its Notice Office (which
shall promptly advise each Bank) not less than three

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Business Days’ prior notice thereof specifying
the Loans to be prepaid and the date and amount of prepayment, (d) any prepayment of principal of
any Loan shall include accrued interest to the date of prepayment on the principal amount being
prepaid and (e) any prepayment of a LIBOR Rate Loan shall be subject to the provisions of Section
7.4.

          SECTION 6. MAKING AND PRORATION OF PAYMENTS; SET-OFF; TAXES.

          Section 6.1. Making of Payments. Except as provided in Section 3.2(d), payments
(including those made pursuant to Section 5.1) of principal of, or interest on, the Loans and all
payments of fees and any other payments required to be made by the Company to the Agent hereunder
shall be made by the Company to the Agent in immediately available funds at its Payment Office not
later than 12:00 Noon, New York City time, on the date due; and funds received after that hour
shall be deemed to have been received by the Agent on the next following Business Day. The Agent
shall promptly remit to each Bank its share (if any) of each such payment. All payments under
Section 7 and all payments required to be made hereunder to any Person other than the Agent shall
be made by the Company when due directly to the Persons entitled thereto in immediately available
funds.

          Section 6.2. Pro Rata Treatment; Sharing.

          (a) Except as required pursuant to Section 7 or Section 13.8, each payment or prepayment of
principal of any Committed Loans, each payment of interest on the Committed Loans, each payment of
the utilization fee and each payment of the facility fee shall be allocated pro
rata among the Banks in accordance with their respective Percentages. Each payment of
principal of any Bid Borrowing shall be allocated pro rata among the Banks
participating in such Bid Borrowing in accordance with the respective principal amounts of their
outstanding Bid Loans comprising such Bid Borrowing. Each payment of interest on any Bid Borrowing
shall be allocated pro rata among the Banks participating in such Bid Borrowing in
accordance with the respective amounts of accrued and unpaid interest on their outstanding Bid
Loans comprising such Bid Borrowing.

          (b) If any Bank or other holder of a Committed Loan shall obtain any payment or other
recovery (whether voluntary, involuntary, by application of offset or otherwise) on account of
principal of, interest on or fees or other amounts with respect to any Committed Loan in excess of
the share of payments and other recoveries (exclusive of payments or recoveries under Section 7 or
pursuant to Section 13.8) such Bank or other holder would have received if such
payment had been distributed pursuant to the provisions of Section 6.2(a), such Bank or other
holder shall purchase from the other Banks or holders, in a manner to be specified by the Agent,
such participations in the Committed Loans held by them as shall be necessary so that all such
payments of principal and interest with respect to the Committed Loans shall be shared by the Banks
and other holders pro rata in accordance with their respective Percentages;
provided, however, that if all or any portion of the excess payment or other
recovery is thereafter recovered from such purchasing Bank or holder, the purchase shall be
rescinded and the purchase price restored to the extent of such recovery, but without interest.

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          (c) If any Bank or other holder of a Bid Loan shall obtain any payment or other recovery
(whether voluntary, involuntary, by application of offset or otherwise) on account of principal of,
interest on or fees or other amounts with respect to any Bid Loan in excess of the share of
payments and other recoveries (exclusive of payments or recoveries pursuant to Section 7 or Section
13.8) such Bank or other holder would have received if such payment had been distributed pursuant
to the provisions of Section 6.2(a), such Bank or other holder shall purchase from the other Banks
or holders participating in such Bid Borrowing, in a manner to be specified by the Agent, such
participations in the Bid Loans held by them as shall be necessary so that all such payments of
principal and interest with respect to the Bid Loans shall be shared by the Banks and other holders
participating in such Bid Borrowing in a manner consistent with Section 6.2(a); provided,
however, that if all or any portion of the excess payment or other recovery is thereafter
recovered from such purchasing Bank or holder, the purchase shall be rescinded and the purchase
price restored to the extent of such recovery, but without interest.

          Section 6.3. Set-off. The Company agrees that the Agent, each Bank, each Assignee
and each Participant has all rights of set-off and banker’s lien provided by applicable law, and
the Company further agrees that at any time (i) any amount owing by the Company under this
Agreement is due to any such Person or (ii) any Event of Default exists, each such Person may apply
to the payment of any amount payable hereunder any and all balances, credits, deposits, accounts or
moneys of the Company then or thereafter with such Person.

          Section 6.4. Taxes, etc. (a) All payments made by the Company to the Agent, any
Bank, any Assignee or any Participant under this Agreement and the Notes shall be made without any
set-off or counterclaim, and free and clear of and without deduction for or on account of any
present or future Covered Taxes now or hereafter imposed (except to the extent that such
withholding or deduction (x) is compelled by law, (y) results from the breach, by the recipient of
a payment, of its agreement contained in Section 6.4(b), Section 6.4(c) or Section 6.4(e) or (z)
would not be required if the representation or warranty contained in the second sentence of Section
6.4(b) were true as of the date of this Agreement, or with respect to a Bank that becomes a Bank
pursuant to Section 13.4.1, Section 13.4.2 or Section 13.8, true at the time such Bank becomes a
Bank hereunder). If the Company is compelled by law to make any such deductions or withholdings of
any Covered Taxes it will:

     (i) pay to the relevant authorities the full amount required to be so withheld or
deducted,

     (ii) except to the extent that such withholding or deduction results from the breach
by the recipient of its agreement contained in Section 6.4(b), Section 6.4(c) or Section
6.4(e) or, if applicable, would not be required if the representation or warranty contained
in the second sentence of Section 6.4(b) were true as of the date of this Agreement, or with
respect to a Bank that becomes a Bank pursuant to Section 13.4.1, Section 13.4.2 or Section
13.8, true at the time such Bank becomes a Bank hereunder, pay such additional amounts as
may be necessary in order that the net amount received by the Agent, each Bank, each
Assignee and each Participant after such deductions or withholdings (including any required
deduction or withholding on such additional

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amounts) shall equal the amount such payee would
have received had no such deductions or withholdings been made, and

     (iii) promptly forward to the Agent (for delivery to such payee) an official receipt
or other documentation satisfactory to the Agent evidencing such payment to such
authorities.

          Moreover, if any Covered Taxes are directly asserted against the Agent, any Bank, any Assignee
or any Participant, such payee may pay such Covered Taxes, and, upon receipt of an official receipt
or other satisfactory documentation evidencing such payment, the Company shall promptly pay such
additional amount (including, without limitation, any penalties, interest or reasonable expenses)
as may be necessary in order that the net amount received by such payee after the payment of such
Covered Taxes (including any Covered Taxes on such additional amount) shall equal the amount such
payee would have received had no such Covered Taxes been asserted (provided, that the
Agent, the Banks, and any Assignee or Participant shall use reasonable efforts, to the extent
consistent with applicable laws and regulations, to minimize to the extent possible any such
Covered Taxes if they can do so without material cost or legal or regulatory disadvantage). For
purposes of this Section 6.4, a distribution hereunder by the Agent or any Bank to or for the
account of any Bank, Assignee or Participant shall be deemed to be a payment by the Company. The
Company’s agreement under this Section 6.4 shall survive repayment of the Loans, cancellation of
the Notes or any termination of this Agreement.

          (b) In consideration of, and as a condition to, the Company’s undertakings in Section 6.4(a),
each Bank other than a Bank that is organized and existing under the laws of the United States of
America or any State thereof (a “Non-U.S. Bank”) agrees to execute and deliver to the Agent
at its Payment Office for delivery to the Company, before the first scheduled payment date in each
year, (i) to the extent it acts for its own account with respect to any portion of any sums paid or
payable to such Non-U.S. Bank under this Agreement, two original copies of United States Internal
Revenue Service Forms W-8BEN, W-8ECI or W-8EXP (or any successor forms), as appropriate, properly
completed and duly executed by such Non-U.S. Bank, and claiming complete exemption from withholding
and deduction of United States Federal Taxes, and (ii) to the extent it does not act or has ceased
to act for its own account with respect to any portion of any sums paid or payable to such Bank
under this Agreement (for example, in the case of a typical Participation by such Non-U.S. Bank),
(1) for the portion of any such sums paid or payable with respect to which such Non-U.S. Bank acts
for its own account, two original copies of the forms or statements required to be provided by such
Non-U.S. Bank under subsection (i)
of this Section 6.4(b), properly completed and duly executed by such Non-U.S. Bank and
claiming complete exemption from withholding and deduction of United States Federal Taxes, and (2)
for the portion of any such sums paid or payable with respect to which such Non-U.S. Bank does not
act or has ceased to act for its own account, two original copies of United States Internal Revenue
Service Form W-8IMY (or any successor forms), properly completed and duly executed by such Non-U.S.
Bank, together with any information, if any, such Non-U.S. Bank chooses to transmit with such form,
and any other certificate or statement of exemption required under the Internal Revenue Code or the
regulations issued thereunder. Each Bank hereby (i) represents and warrants to the Company that,
at the date of this Agreement, or at the time such

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Bank becomes a Bank hereunder, it is entitled to
receive payments of principal and interest hereunder without deduction for or on account of any
Taxes imposed by the United States of America or any political subdivision thereof, and (ii)
acknowledges that in the event that after the date of this Agreement or after the date that a Bank
becomes a Bank hereunder, such Bank is no longer entitled to receive payments or principal and
interest hereunder without deduction for or on account of any Taxes imposed by the United States of
America or any political subdivision thereof, such Bank will be subject to removal pursuant to
Section 13.8 hereof.

          (c) Each Non-U.S. Bank hereby agrees, from time to time after the initial delivery by such
Non-U.S. Bank of any forms or other information pursuant to Section 6.4(b), whenever a lapse in
time or change in circumstances renders such forms, certificates or other evidence so delivered
obsolete or inaccurate in any material respect, that such Non-U.S. Bank shall promptly (and in all
events, prior to the next applicable payment date), deliver to the Agent at the Payment Office for
delivery to the Company two original copies of any renewal, amendment or additional or successor
forms, properly completed and duly executed by such Non-U.S. Bank, together with any other
certificate or statement of exemption required by applicable law or regulation in order to (i)
confirm or establish such Non-U.S. Bank’s complete exemption from withholding and deduction of
United States Federal Taxes with respect to payments to such Bank under this Agreement or (ii) in
the case of a change in law after the date on which such Non-U.S. Bank became a Bank hereunder that
results in a withholding or deduction of United States Federal Taxes on payments hereunder to such
Non-U.S. Bank, establish the status of such Non-U.S. Bank as other than a United States person for
United States Federal tax purposes and, to the extent entitled under an applicable treaty or other
law, claim the benefit of a reduced rate of withholding and deduction of United States Federal
Taxes with respect to any such payments under an applicable tax treaty of the United States, or
(iii) if applicable, confirm or establish that such Non-U.S. Bank does not act for its own account
with respect to any portion of any such payments.

          (d) If the Company determines in good faith that a reasonable basis exists for contesting a
Covered Tax with respect to which the Company has paid an additional amount under this Section 6.4,
the Agent and the Banks, as applicable, shall, subject to Section 6.4(f), cooperate with the
Company in challenging such Covered Tax at the Company’s expense if requested by the Company (it
being understood and agreed that neither the Agent nor any Bank shall have any obligation to
contest, or any responsibility for contesting, any Tax). If the Agent or a Bank has actual
knowledge that it is entitled to receive a refund (whether by way of a direct payment or by clearly
identifiable offset to an amount otherwise owed to the relevant taxing authority) in respect of a
Covered Tax with respect to which the Company has paid an additional
amount under this Section 6.4, it shall promptly notify the Company of the availability of
such refund (unless it was made aware of such refund by the Company) and shall, within 30 days
after the receipt of a request from the Company, apply for such refund at the Company’s expense.
If the Agent or any Bank receives a refund (whether by way of a direct payment or by clearly
identifiable offset to an amount otherwise owed to the relevant taxing authority) of any Covered
Tax with respect to which the Company has paid an additional amount under this Section 6.4 which,
in the reasonable good faith judgment of the Agent or such Bank, as the case may be, is allocable
to such payment made under this Section 6.4, the amount of such refund (together with any interest
received thereon) shall be paid to the Company, but only to the extent of the

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additional amounts
received from the Company, provided that, in the case of a Covered Tax the Company was
required to deduct and withhold under this Section 6.4, the Company deducted and withheld such
Covered Tax in full as and when required pursuant to this Section 6.4, provided
further, that if such refund subsequently becomes unavailable or must be returned, this
will be treated as a Covered Tax indemnifiable under this Section 6.4.

          (e) Each Bank that is organized and existing under the laws of the United States of America
or any State thereof (a “U.S. Bank”) agrees to execute and deliver to the Agent at the
Payment Office for delivery to the Company, on or before the date of this Agreement or on or before
the date such Bank becomes a Bank hereunder and on or before the date on which such Bank ceases to
act for its own account with respect to the applicable portion of any sums paid or payable to such
U.S. Bank and before the first scheduled payment date in each subsequent year a copy of United
States Internal Revenue Service Form W-9 (or any successor forms) properly completed and duly
executed by such U.S. Bank, and claiming that it is organized and existing under the laws of the
United States of America or any State thereof.

          (f) Nothing contained in this Section 6.4 shall require any Bank to make available its tax
returns (or any other information relating to its taxes that it deems confidential) to the Company
or any other Person.

          (g) Each Bank shall promptly notify the Company and the Agent of any event of which it has
knowledge, occurring after the date hereof, which will entitle such Bank to receipt of additional
amounts pursuant to this Section 6.4 and will designate a different Funding Office if such
designation will avoid the need for, or reduce the amount of, such amounts and will not, in such
Bank’s sole discretion, be otherwise disadvantageous to such Bank.

          SECTION 7. INCREASED COSTS AND SPECIAL PROVISIONS FOR ABSOLUTE RATE LOANS AND LIBOR
RATE LOANS.

          Section 7.1. Increased Costs. (a) If after the date hereof, the adoption of any
applicable law, rule or regulation, or any change therein, or any change in the interpretation or
administration thereof by any Governmental Authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by any Bank (or any Funding Office
of such Bank) with any request or directive (whether or not having the force of law) of any such
authority, central bank or comparable agency,

     (A) shall subject any Bank (or any Funding Office of such Bank) to any tax, duty or
other charge with respect to its LIBOR Rate Loans, its Notes or its obligation to make LIBOR
Rate Loans, or shall change the basis of taxation of payments to any Bank (or any Funding
Office of such Bank) of the principal of or interest on its LIBOR Rate Loans or any other
amounts due under this Agreement in respect of its LIBOR Rate Loans or its obligation to
make LIBOR Rate Loans (except for changes in the rate of tax on the overall net income of
such Bank or its Funding Office imposed by any Governmental Authority of the country in
which such Bank is incorporated or in which such Bank’s Funding Office is located);

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     (B) shall impose, modify or deem applicable any reserve (including, without
limitation, any reserve imposed by the Board of Governors of the Federal Reserve System, but
excluding any reserve included in the determination of additional interest pursuant to
Section 4.1), special deposit, assessment (including any assessment for insurance of
deposits) or similar requirement against assets of, deposits with or for the account of, or
credit extended by, any Bank (or any Funding Office of such Bank); or

     (C) shall impose on any Bank (or any Funding Office of such Bank) any other condition
affecting its LIBOR Rate Loans, its Notes or its obligation to make or maintain LIBOR Rate
Loans;

and the result of any of the foregoing is to increase the cost to (or to impose an additional cost
on) such Bank (or any Funding Office of such Bank) of making or maintaining any LIBOR Rate Loan, or
to reduce the amount of any sum received or receivable by such Bank (or such Bank’s Funding Office)
under this Agreement or under its Notes with respect thereto, then within 10 days after demand by
such Bank (which demand shall be accompanied by a statement setting forth the basis of such
demand), the Company shall pay directly to such Bank such additional amount or amounts as will
compensate such Bank for such increased cost or such reduction (without duplication of any amounts
which have been paid or reimbursed).

          (b) If, after the date hereof, any Bank shall determine that the adoption, effectiveness or
phase-in of any applicable law, rule, guideline or regulation regarding capital adequacy, or any
change therein, or any change in the interpretation or administration thereof by any Governmental
Authority, central bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Bank (or any Funding Office of such Bank or any Person controlling
such Bank) with any request or directive regarding capital adequacy (whether or not having the
force of law) of any such authority, central bank or comparable agency, has or would have the
effect of reducing the rate of return on the capital of such Bank or any Person controlling such
Bank as a consequence of its obligations hereunder to a level below that which such Bank or such
controlling Person could have achieved but for such adoption, change or compliance (taking into
consideration such Bank’s or such controlling Person’s policies with respect to capital adequacy),
then, from time to time, within 10 days after demand by such Bank (which demand shall be
accompanied by a statement setting forth the basis of such demand), the Company shall pay directly
to such Bank such additional amount or amounts as will compensate such Bank or such controlling
Person for such reduction.

          (c) Each Bank shall promptly notify the Company and the Agent of any event of which it has
knowledge, occurring after the date hereof, which will entitle such Bank to compensation pursuant
to this Section 7.1 and will designate a different Funding Office if such designation will avoid
the need for, or reduce the amount of, such compensation and will not, in such Bank’s sole
judgment, be otherwise disadvantageous to such Bank.

          Section 7.2. Basis for Determining Interest Rate Inadequate or Unfair. If with
respect to the Loan Period for any LIBOR Rate Loan:

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     (a) the Telerate Page is not available and the Agent is advised by two or more
Reference Banks that deposits in Dollars (in the applicable amounts) are not being offered
to such Reference Banks in the relevant market for such Loan Period, or the Agent otherwise
determines (which determination shall be binding and conclusive on all parties) that, by
reason of circumstances affecting the LIBOR market, adequate and reasonable means do not
exist for ascertaining the applicable LIBOR Rate; or

     (b) the Required Banks advise the Agent that the LIBOR Rate as determined by the Agent
will not adequately and fairly reflect the cost to such Required Banks of maintaining or
funding LIBOR Rate Loans for such Loan Period, or that the making or funding of LIBOR Rate
Loans has become impracticable as a result of an event occurring after the date of this
Agreement which in such Required Banks’ opinion materially affects LIBOR Rate Loans,

then (i) the Agent shall promptly notify the other parties thereof and (ii) so long as such
circumstances shall continue, no Bank shall be under any obligation to make any LIBOR Rate Loan.

          Section 7.3. Changes in Law Rendering Certain Loans Unlawful. In the event that any
change in (including the adoption of any new) applicable laws or regulations, or in the
interpretation of applicable laws or regulations by any Governmental Authority or other regulatory
body charged with the administration thereof, should make it (or in the good faith judgment of such
Bank raise a substantial question as to whether it is) unlawful for a Bank to make, maintain or
fund any LIBOR Rate Loan, then (a) such Bank shall promptly notify each of the other parties
hereto, (b) upon the effectiveness of such event and so long as such unlawfulness shall continue,
the obligation of such Bank to make LIBOR Rate Loans shall be suspended and any request by the
Company for LIBOR Rate Loans shall, as to such Bank, be deemed to be a request for a Base Rate
Loan, if said LIBOR Rate Loan is a Committed Loan, or an Absolute Rate Loan, if said LIBOR Rate
Loan is a Bid Loan and (c) on the last day of the current Loan Period for such Bank’s LIBOR Rate
Loans (or, in any event, if such Bank so requests on such earlier date as may be required by the
relevant law, regulation or interpretation) such Bank’s Loans which are LIBOR Rate Loans shall
cease to be maintained as LIBOR Rate Loans and shall thereafter bear interest at a floating rate
per annum equal to the Base Rate, if said LIBOR Rate Loan is a Committed Loan, or at an Absolute
Rate, which Absolute Rate shall be the LIBOR Rate in effect during such Loan Period, if said LIBOR
Rate Loan is a Bid Loan. If at any time the event giving rise to such unlawfulness shall no longer
exist, then such Bank shall promptly notify the Company and the Agent.

          Section 7.4. Funding Losses. The Company hereby agrees that upon demand by any Bank
(which demand shall be accompanied by a statement setting forth the basis for the calculations of
the amount being claimed) the Company will indemnify such Bank against any net loss or expense
which such Bank may sustain or incur (including, without limitation, any net loss or expense
incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such
Bank to fund or maintain any LIBOR Rate Loan or Absolute Rate Loan), as reasonably determined by
such Bank, as a result of (a) any payment or mandatory or voluntary prepayment (including, without
limitation, any payment pursuant to Section 7.3 or any payment

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resulting from acceleration) of any
LIBOR Rate Loan or Absolute Rate Loan of such Bank on a date other than the last day of the Loan
Period for such Loan or (b) any failure of the Company to borrow any Loans on the originally
scheduled Funding Date specified therefor pursuant to this Agreement (including, without
limitation, any failure to borrow resulting from any failure to satisfy the conditions precedent to
such borrowing). For this purpose, all notices to the Agent pursuant to this Agreement (including,
without limitation, all acceptances of Bids) shall be deemed to be irrevocable.

          Section 7.5. Discretion of Banks as to Manner of Funding. Notwithstanding any
provision of this Agreement to the contrary (but subject to Section 7.1(c)), each Bank shall be
entitled to fund and maintain its funding of all or any part of its Loans in any manner it sees
fit, it being understood, however, that for the purposes of this Agreement all determinations
hereunder shall be made as if such Bank had actually funded and maintained each LIBOR Rate Loan or
Absolute Rate Loan during the Loan Period for such Loan through the purchase of deposits having a
maturity corresponding to such Loan Period and bearing an interest rate equal to the rate borne by
such Loan for such Loan Period.

          Section 7.6. Conclusiveness of Statements; Survival of Provisions. Determinations
and statements of any Bank pursuant to this Section 7 shall be conclusive absent demonstrable
error, and each Bank may use reasonable averaging and attribution methods in determining
compensation pursuant to Section 7.1 or 7.4. The provisions of this Section 7 shall survive
termination of this Agreement and payment of the Loans.

          SECTION 8. REPRESENTATIONS AND WARRANTIES.

          To induce the Banks to enter into this Agreement and to make Loans hereunder, the Company
hereby makes the following representations and warranties to the Agent and the Banks, which
representations and warranties shall survive the execution and delivery of this Agreement and the
Notes and the disbursement of the initial Loans hereunder:

          Section 8.1. Organization, etc. The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of California; each corporate Subsidiary
is a corporation duly organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation; each other Subsidiary (if any) is an entity duly organized and
validly existing under the laws of the jurisdiction of its organization; and each of the Company
and each Subsidiary has the power to own its property and to carry on its business as now being
conducted and is duly qualified and in good standing as a foreign corporation or other entity
authorized to
do business in each jurisdiction where, because of the nature of its activities or properties,
such qualification is required, except where the failure to be so qualified or in good standing
could not reasonably be expected to have a Material Adverse Effect.

     Section 8.2. Authorization; Consents; No Conflict. The execution and delivery by the
Company of this Agreement and the Notes, the borrowings hereunder and the performance by the
Company of its obligations under this Agreement and the Notes (a) are within the corporate powers
of the Company, (b) have been duly authorized by all necessary corporate action on the part of the
Company, (c) have received all necessary approvals, authorizations, consents, registrations,
notices, exemptions and licenses (if any shall be required)

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from Governmental Authorities and other
Persons, except for any such approvals, authorizations, consents, registrations, notices,
exemptions or licenses non-receipt of which could not reasonably be expected to have a Material
Adverse Effect, (d) do not and will not contravene or conflict with any provision of (i) law, (ii)
any judgment, decree or order to which the Company or any Subsidiary is a party or by which the
Company or any Subsidiary is bound, (iii) the charter, by-laws or other organizational documents of
the Company or any Subsidiary or (iv) any provision of any agreement or instrument binding on the
Company or any Subsidiary, or any agreement or instrument of which the Company is aware affecting
the properties of the Company or any Subsidiary, except with respect to (i), (ii) and (iv) above,
for any such contravention or conflict which could not reasonably be expected to have a Material
Adverse Effect and (e) do not and will not result in or require the creation or imposition of any
Lien on any of the Company’s or its Subsidiaries’ properties.

          Section 8.3. Validity and Binding Nature. This Agreement is, and the Notes (if any)
when duly executed and delivered will be, legal, valid and binding obligations of the Company,
enforceable against the Company in accordance with their respective terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors’ rights and to general equity principles.

          Section 8.4. Financial Statements. The Company’s audited consolidated financial
statements as at December 31, 2005, and unaudited consolidated financial statements as at June 30,
2006, a copy of each of which has been furnished to each Bank, have been prepared in conformity
with generally accepted accounting principles in the United States of America applied on a basis
consistent with that of the preceding fiscal year subject, in the case of unaudited financial
statements, to changes resulting from audit and year-end adjustments and fairly present the
financial condition of the Company and its Subsidiaries as at such dates and the results of their
operations for the year then ended.

          Section 8.5. Litigation and Contingent Liabilities. All Litigation Actions, taken as
a whole, could not reasonably be expected to have a Material Adverse Effect. Other than any
liability incident to such Litigation Actions or provided for or disclosed in the financial
statements referred to in Section 8.4, neither the Company nor any Subsidiary has any contingent
liabilities which are material to the business, credit, operations or financial condition of the
Company and its Subsidiaries taken as a whole.

          Section 8.6. Employee Benefit Plans. Each employee benefit plan (as defined in
Section 3(3) of ERISA) maintained or sponsored by the Company or any Subsidiary complies in all
material respects with all applicable requirements of law and regulations. During the
twelve-consecutive-month period prior to the execution and delivery of this Agreement, (i) no steps
have been taken to terminate any Plan and no contribution failure has occurred with respect to any
Plan sufficient to give rise to a lien under Section 302(f) of ERISA, (ii) no Reportable Event has
occurred with respect to any Plan and (iii) neither the Company nor any ERISA Affiliate has either
withdrawn or instituted steps to withdraw from any Multiemployer Plan, except in any such case for
actions which individually or in the aggregate could not reasonably be expected to have a Material
Adverse Effect. No condition exists or event or transaction has occurred in connection with any
Plan which could reasonably be expected to result in the incurrence by the

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Company or any
Subsidiary of any material liability, fine or penalty (imposed by Section 4975 of the Code or
Section 502(i) of ERISA or otherwise). Neither the Company nor any ERISA Affiliate is a member of,
or contributes to, any Multiemployer Plan as to which the potential withdrawal liability based upon
the most recent actuarial report could reasonably be expected to have a Material Adverse Effect.
Neither the Company nor any Subsidiary has any material contingent liability with respect to any
post retirement benefit under an employee welfare benefit plan (as defined in section 3(i) of
ERISA), other than liability for continuation coverage described in Part 6 of Title I of ERISA.

          Section 8.7. Investment Company Act. The Company is not an “investment company” or a
company “controlled” by an “investment company”, within the meaning of the Investment Company Act
of 1940, as amended.

          Section 8.8. Regulation U. Neither the Company nor any Subsidiary is engaged
principally, or as one of its important activities, in the business of extending credit for the
purpose of buying or carrying margin stock (within the meaning of Regulation U of the Board of
Governors of the Federal Reserve System as amended from time to time).

          Section 8.9. Information. (a) All information with respect to the Company contained
in the September, 2006 memorandum furnished by the Agent to the Banks and all information
heretofore furnished by the Company to the Agent or any Bank is, to the best of the Company’s
knowledge after due inquiry, true and accurate in every material respect as of the date thereof,
and none of such information contains any material misstatement of fact or omits to state any
material fact necessary to make such information not misleading.

          (b) All information furnished by the Company to the Agent or any Bank on and after the date
hereof shall be, to the best of the Company’s knowledge after due inquiry, true and accurate in
every material respect as of the date of such information, and none of such information shall
contain any material misstatement of fact or shall omit to state any material fact necessary to
make such information not misleading.

          Section 8.10. Compliance with Applicable Laws, etc. The Company and its Subsidiaries are in compliance with the requirements of all applicable
laws, rules, regulations and orders of all Governmental Authorities (including, without limitation,
ERISA and all applicable environmental laws), except for noncompliance that could not reasonably be
expected to have a Material Adverse Effect. Neither the Company nor any Subsidiary is in default
under any agreement or instrument to which the Company or such Subsidiary is a party or by which it
or any of its properties or assets is bound, which default could reasonably be expected to have a
Material Adverse Effect on the business, credit, operations or financial condition of the Company
and its Subsidiaries taken as a whole. No Event of Default or Unmatured Event of Default has
occurred and is continuing.

          Section 8.11. Insurance. Each of the Company and each Subsidiary maintains, or, in
the case of any property owned by the Company or any Subsidiary and leased to lessees, has
contractually required such lessees to maintain, insurance with financially sound and

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reputable
insurers to such extent and against such hazards and liabilities as is commonly maintained, or
caused to be maintained, as the case may be, by companies similarly situated.

          Section 8.12. Taxes. Each of the Company and each Subsidiary has filed all tax
returns which are required to have been filed and has paid, or made adequate provisions for the
payment of, all of its Taxes which are due and payable, except such Taxes, if any, as are being
contested in good faith and by appropriate proceedings and as to which such reserves or other
appropriate provisions as may be required by generally accepted accounting principles have been
established and except where failure to pay such Taxes, individually or in the aggregate, cannot
reasonably be expected to have a Material Adverse Effect.

          Section 8.13. Use of Proceeds. The proceeds of the Loans will be used by the Company
for general corporate purposes.

          Section 8.14. Pari Passu. All obligations and liabilities of the Company hereunder shall
rank at least equally and ratably (pari passu) in priority with all other
unsubordinated, unsecured obligations of the Company to any other creditor.

          SECTION 9. COVENANTS.

          Until the expiration or termination of the Commitments, and thereafter until all obligations
of the Company hereunder and under the Notes are paid in full, the Company agrees that, unless at
any time the Required Banks shall otherwise expressly consent in writing, it will:

          Section 9.1. Reports, Certificates and Other Information. Furnish to the Agent with
sufficient copies for each Bank which the Agent shall promptly furnish to each Bank:

     9.1.1. Audited Financial Statements. As soon as available, and in any event
within 95 days after each fiscal year of the Company, a copy of the audited financial
statements and annual audit report of the Company and its Subsidiaries for such fiscal
year prepared on a consolidated basis and in conformity with generally accepted accounting
principles in the United States of America and certified by PricewaterhouseCoopers LLP or by
another independent certified public accountant of recognized national standing selected by
the Company and satisfactory to the Required Banks.

     9.1.2. Interim Reports. As soon as available, and in any event within 50 days
after each quarter (except the last quarter) of each fiscal year of the Company, a copy of
the unaudited financial statements of the Company and its Subsidiaries for such quarter
prepared in a manner consistent with the audited financial statements referred to in Section
9.1.1, signed by the Company’s chief financial officer and consisting of at least a balance
sheet as at the close of such quarter and statements of earnings and cash flows for such
quarter and for the period from the beginning of such fiscal year to the close of such
quarter.

     9.1.3. Certificates. Contemporaneously with the furnishing of a copy of each
annual audit report and of each set of quarterly statements provided for in this Section

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9.1, a certificate of the Company dated the date of delivery of such annual report or such
quarterly statements and signed by the Company’s chief financial officer, to the effect that
no Event of Default or Unmatured Event of Default has occurred and is continuing, or, if
there is any such event, describing it and the steps, if any, being taken to cure it and
containing a computation of, and showing compliance with, each of the financial ratios and
restrictions contained in this Section 9.

     9.1.4. Certain Notices. Forthwith upon learning of the occurrence of any of
the following, written notice thereof, describing the same and the steps being taken by the
Company or the Subsidiary affected with respect thereto:

     (i) the occurrence of an Event of Default or an Unmatured Event of Default;

     (ii) the institution of any Litigation Action; provided, that the
Company need not give notice of any new Litigation Action unless such Litigation
Action, together with all other pending Litigation Actions, could reasonably be
expected to have a Material Adverse Effect;

     (iii) the entry of any judgment or decree against the Company or any
Subsidiary if the aggregate amount of all judgments and decrees then outstanding
against the Company and all Subsidiaries exceeds $50,000,000 after deducting (i) the
amount with respect to which the Company or any Subsidiary is insured and with
respect to which the insurer has not denied coverage in writing and (ii) the amount
for which the Company or any Subsidiary is otherwise indemnified if the terms of
such indemnification are satisfactory to the Agent and the Required Banks;

     (iv) the occurrence of a Reportable Event with respect to any Plan; the
institution of any steps by the Company, any ERISA Affiliate, the PBGC or any other
Person to terminate any Plan; the institution of any steps by the Company or any
ERISA Affiliate to withdraw from any Plan; the incurrence of any material increase
in the contingent liability of the Company or any Subsidiary with respect to any
post-retirement welfare benefits; or the failure of the Company or any other Person
to make a required contribution to a Plan if such failure is sufficient to give rise
to a lien under Section 302(f) of ERISA; provided, however, that no
notice shall be required of any of the foregoing unless the circumstance could
reasonably be expected to have a Material Adverse Effect; or

     (v) the occurrence of a material adverse change in the business, credit,
operations or financial condition of the Company and its Subsidiaries taken as a
whole.

     9.1.5. Other Information. From time to time such other information concerning
the Company and its Subsidiaries (not including reports and other materials to the extent

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filed with the Securities and Exchange Commission) as any Bank or the Agent may reasonably
request.

          Section 9.2. Existence. Maintain and preserve, and, subject to the proviso in
Section 9.9, cause each Subsidiary to maintain and preserve, its respective existence as a
corporation or other form of business organization, as the case may be, and all rights, privileges,
licenses, patents, patent rights, copyrights, trademarks, trade names, franchises and other
authority to the extent material and necessary for the conduct of its respective business in the
ordinary course as conducted from time to time, except as may be determined by the Board of
Directors of the Company in good faith that a Subsidiary that is not necessary or material to the
business of the Company in its ordinary course as conducted from time to time.

          Section 9.3. Nature of Business. Subject to Section 9.2, engage, and cause each
Subsidiary to engage, in substantially the same fields of business as it is engaged in on the date
hereof.

          Section 9.4. Books, Records and Access.

          (a) Maintain, and cause each Subsidiary to maintain, complete and accurate books and records
in which full and correct entries in conformity with generally accepted accounting principles in
the United States of America shall be made of all dealings and transactions in relation to its
respective business and activities.

          (b) Permit, and cause each Subsidiary to permit, access by the Agent and each Bank to the
books and records of the Company and such Subsidiary during normal business hours, and permit, and
cause each Subsidiary to permit, the Agent and each Bank to make copies of such books and records
upon reasonable notice and as often as may be reasonably requested.

          Section 9.5. Insurance. Maintain, and cause each Subsidiary to maintain, such
insurance as is described in Section 8.11.

          Section 9.6. Repair. Maintain, preserve and keep, and cause each Subsidiary to
maintain, preserve and keep, its material properties in good repair, working order and condition,
ordinary wear and tear excepted. In the case of properties leased by the Company or any Subsidiary
to lessees, the Company may satisfy its obligations related to such properties under the previous
sentence by contractually requiring, or by causing each Subsidiary to contractually require, such
lessees to perform such obligations.

          Section 9.7. Taxes. Pay or cause to be paid, and cause each Subsidiary to pay, or
cause to be paid, prior to the imposition of any penalty or fine, all of its Taxes, unless and only
to the extent that the Company or such Subsidiary, as the case may be, is contesting any such Taxes
in good faith and by appropriate proceedings and the Company or such Subsidiary has set aside on
its books such reserves or other appropriate provisions therefor as may be required by generally
accepted accounting principles in the United States of America, except where failure to pay such
Taxes, individually or in the aggregate, cannot reasonably be expected to have a Material Adverse
Effect.

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          Section 9.8. Compliance. Comply, and cause each Subsidiary to comply with all
statutes (including without limitation ERISA) and governmental rules and regulations applicable to
it except to the extent noncompliance could not reasonably be expected to have a Material Adverse
Effect.

          Section 9.9. Sale of Assets. Not, and not permit any Subsidiary to, transfer,
convey, lease (except for in the ordinary course of business) or otherwise dispose of all or
substantially all of the assets of the Company and its Subsidiaries taken as a whole;
provided, however, that any Wholly-owned Subsidiary may sell, transfer, convey,
lease or assign all or a substantial part of its assets to the Company or another Wholly-owned
Subsidiary if immediately thereafter and after giving effect thereto no Event of Default or
Unmatured Event of Default shall have occurred and be continuing.

          Section 9.10. Consolidated Indebtedness to Consolidated Tangible Net Worth Ratio.
Not permit the ratio of Consolidated Indebtedness to Consolidated Tangible Net Worth to exceed 600%
on and as of the last day of any fiscal year or 650% at any other time.

          Section 9.11. Fixed Charge Coverage Ratio. Not permit the Fixed Charge Coverage
Ratio on the last day of any quarter of any fiscal year of the Company to be less than 110%.

          Section 9.12. Consolidated Tangible Net Worth. Not permit the Company’s Consolidated
Tangible Net Worth to be less than $3,500,000,000 minus, to the extent included in the
calculation of Consolidated Tangible Net
Worth, other comprehensive income of the Company and its Subsidiaries (or, in the case of a
comprehensive income deficit, plus the amount of such deficit) plus 50% of (a) the
cumulative net income (but without deduction for cumulative net losses) of the Company and its
Subsidiaries since December 31, 2002 determined on a consolidated basis in accordance with United
States of America generally accepted accounting principles, (b) the cumulative equity capital
contributions from AIG or any of its direct or indirect Subsidiaries since December 31, 2002 and
(c) the net proceeds from the sale of preferred stock, in each case for the period from December
31, 2002 to and including the date of any determination hereunder.

          Section 9.13. Restricted Payments. Not declare or pay any dividends whatsoever or
make any distribution on any capital stock of the Company (except in shares of, or warrants or
rights to subscribe for or purchase shares of, capital stock of the Company), and not permit any
Subsidiary to, make any payment to acquire or retire shares of capital stock of the Company, in
each case at any time when (i) an Event of Default as described in Section 11.1 has occurred and is
continuing and there are Loans outstanding hereunder or (ii) an Event of Default as described in
Section 11.1.1 has occurred and is continuing and there are no Loans outstanding hereunder;
provided, however, that notwithstanding the foregoing, this Section 9.13 shall not
prohibit (x) the payment of dividends on any of the Company’s market auction preferred stock that
was sold to the public pursuant to an effective registration statement under the Securities Act of
1933 or (y) the payment of dividends within 30 days of the declaration thereof if such declaration
was not prohibited by this Section 9.13.

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          Section 9.14. Liens. Not, and not permit any Subsidiary to, create or permit to
exist any Lien upon or with respect to any of its properties or assets of any kind, now owned or
hereafter acquired, or on any income or profits therefrom, except for:

     (a) Liens existing on the date hereof that are reflected in the financial statements
of the Company dated prior to the date hereof;

     (b) Liens to secure the payment of all or any part of the purchase price of any
property or assets or to secure any Indebtedness incurred by the Company or a Subsidiary to
finance the acquisition of any property or asset. For the avoidance of doubt, Liens
securing Indebtedness relating to ECA Financings or Eximbank financings shall be permitted
hereunder;

     (c) Liens securing the Indebtedness of a Subsidiary owing to the Company or to a
Wholly-owned Subsidiary;

     (d) Liens on property of a corporation existing at the time such corporation is merged
into or consolidated with the Company or a Subsidiary or at the time of a purchase, lease or
other acquisition of the properties of a corporation or firm as an entirety or substantially
as an entirety by the Company or a Subsidiary; provided, that any such Lien shall
not extend to or cover any assets or properties of the Company or such Subsidiary owned by
the Company or such Subsidiary prior to such merger,
consolidation, purchase, lease or acquisition, unless otherwise permitted under this
Section 9.14;

     (e) leases, subleases or licenses granted to others in the ordinary and usual course
of the Company’s business;

     (f) easements, rights of way, restrictions and other similar charges or encumbrances
not interfering in any material respect with the ordinary conduct of the business of the
Company or any Subsidiary;

     (g) banker’s Liens arising, other than by contract, in the ordinary and usual course
of the Company’s business;

     (h) Liens incurred or deposits made in the ordinary course of business in connection
with surety and appeal bonds, leases, government contracts, performance and return-of-money
bonds and other similar obligations (exclusive of obligations for the payment of borrowed
money); provided, however, that the obligation so secured is not overdue or
is being contested in good faith and by appropriate proceedings diligently pursued;

     (i) any replacement or successive replacement in whole or in part of any Lien referred
to in the foregoing clauses (a) to (h), inclusive; provided, however, that
the principal amount of any Indebtedness secured by the Lien shall not be increased and the
principal repayment schedule and maturity of such Indebtedness shall not be extended

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and (i)
such replacement shall be limited to all or a part of the property which secured the Lien so
replaced (plus improvements and construction on such property) or (ii) if the
property which secured the Lien so replaced has been destroyed, condemned or damaged and
pursuant to the terms of the Lien other property has been substituted therefor, then such
replacement shall be limited to all or part of such substituted property;

     (j) Liens created by or resulting from any litigation or other proceeding which is
being contested in good faith by appropriate proceedings, including Liens arising out of
judgments or awards against the Company or any Subsidiary with respect to which the Company
or such Subsidiary is in good faith prosecuting an appeal or proceedings for review; Liens
incurred by the Company or any Subsidiary for the purpose of obtaining a stay or discharge
in the course of any litigation or other proceeding to which the Company or such Subsidiary
is a party; or Liens created by or resulting from any litigation or other proceeding that
would not result in an Event of Default hereunder;

     (k) carrier’s, warehouseman’s, mechanic’s, landlord’s and materialmen’s Liens, Liens
for Taxes, assessments and other governmental charges and other Liens arising in the
ordinary course of business, securing obligations that are not incurred in connection with
the obtaining of any advance or credit and which are either not overdue or are being
contested in good faith and by appropriate proceedings diligently pursued; and

     (l) other Liens securing Indebtedness of the Company or any Subsidiary in an aggregate
amount which, together with all other outstanding Indebtedness of the Company and the
Subsidiaries secured by Liens not listed in clauses (a) through (k) of this Section 9.14,
does not at the time exceed 12.5% of the Consolidated Tangible Net Assets of the Company as
shown on its audited consolidated financial statements as of the end of the fiscal year
preceding the date of determination.

          Section 9.15. Use of Proceeds. Not permit any proceeds of the Loans to be used,
either directly or indirectly,

     (a) for the payment of any dividend or for the repurchase of any of the Company’s
equity securities;

     (b) for the purpose, whether immediate, incidental or ultimate, of buying or carrying
any margin stock within the meaning of Regulation U of the Board of Governors of the Federal
Reserve System, as amended from time to time;

     (c) for the purpose, whether immediate, incidental or ultimate, of acquiring directly
or indirectly any of the outstanding shares of voting stock of any corporation which (i) has
announced that it will oppose such acquisition or (ii) has commenced any litigation which
alleges that any such acquisition violates, or will violate, applicable law; or

     (d) for any other purpose except for general corporate purposes.

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          SECTION 10. CONDITIONS TO LENDING.

          Section 10.1. Conditions Precedent to All Loans. Each Bank’s obligation to make each
Loan is subject to the following conditions precedent:

     10.1.1. No Default. (a) No Event of Default or Unmatured Event of Default has
occurred and is continuing or will result from the making of such Loan, (b) the
representations and warranties contained in Section 8 are true and correct in all material
respects as of the date of such requested Loan, with the same effect as though made on the
date of such Loan (it being understood that each request for a Loan shall automatically
constitute a representation and warranty by the Company that, as at the requested date of
such Loan, (x) all conditions under this Section 10.1.1 shall be satisfied and (y) after the
making of such Loan the aggregate principal amount of all outstanding Loans will not exceed
the Aggregate Commitment).

     10.1.2. Documents. The Agent shall have received (a) a certificate signed by
an Authorized Officer of the Company as to compliance with Section 10.1.1, which requirement
shall be deemed satisfied by the submission of a properly completed Notice of Competitive
Bid Borrowing or Committed Loan Request and (b) such other documents as the Agent may
reasonably request in support of such Loan.

     10.1.3. Litigation. No Litigation Action not disclosed in writing by the
Company to the Agent and the Banks prior to the date of the last previous Loan hereunder
(or, in the case of the initial Loan, prior to the date of execution and delivery of this
Agreement) (“New Litigation”) has been instituted and no development not so
disclosed has occurred in any other Litigation Action (“Existing Litigation”),
unless the resolution of all New Litigation and Existing Litigation against the Company and
its Subsidiaries could not, in the aggregate, reasonably be expected to have a Material
Adverse Effect.

          Section 10.2. Conditions to the Availability of the Commitments. The obligations of
each Bank hereunder are subject to the satisfaction of each of the following conditions precedent,
and the Banks’ Commitments shall not become available until the date on which the Agent has
determined that each of the following conditions precedent shall have been satisfied or, to the
extent not so satisfied, waived in writing by the Required Banks (the “Closing Date”):

     10.2.1. Revolving Credit Agreement. The Agent shall have received this
Agreement duly executed and delivered by each of the Banks and the Company and each of the
Banks shall have received a fully executed Committed Note and a fully executed Bid Note, if
such Notes are requested by any Bank pursuant to Section 12.9.

     10.2.2. Evidence of Corporate Action. The Agent shall have received certified
copies of all corporate actions taken by the Company to authorize this Agreement and the
Notes.

     10.2.3. Incumbency and Signatures. The Agent shall have received a certificate
of the Secretary or an Assistant Secretary of the Company certifying the names of the

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officer or officers of the Company authorized to sign this Agreement, the Notes and the
other documents provided for in this Agreement to be executed by the Company, together with
a sample of the true signature of each such officer (it being understood that the Agent and
each Bank may conclusively rely on such certificate until formally advised by a like
certificate of any changes therein).

     10.2.4. Good Standing Certificates. The Agent shall have received such good
standing certificates of state officials with respect to the incorporation of the Company,
or other matters, as the Agent or the Banks may reasonably request.

     10.2.5. Opinions of Company Counsel. The Agent shall have received favorable
written opinions of O’Melveny & Myers LLP, counsel for the Company, in substantially the
form of Exhibit G, and the General Counsel of the Company, in substantially the form of
Exhibit H.

     10.2.6. Opinion of Agent’s Counsel. The Agent shall have received a favorable
written opinion of Milbank, Tweed, Hadley & McCloy LLP, special New York counsel to the
Agent, with respect to such legal matters as the Agent reasonably may require.

     10.2.7. Other Documents. The Agent shall have received such other certificates
and documents as the Agent or the Banks reasonably may require.

     10.2.8. Fees. The Agent shall have received for the account of the Agent the
Agent’s fees payable to the Funding Date pursuant to Section 4.6 hereof.

     10.2.9. Material Adverse Change. The Agent shall have received a certificate
of the Company’s chief financial officer confirming that since the date of the audited
financial statements identified in Section 8.4 hereof, there shall not have occurred any
material adverse change in the business, credit, operations or financial condition of the
Company and its Subsidiaries taken as a whole.

     10.2.10. Termination of Revolving Credit Facility. The Company shall have
paid all amounts owing and otherwise satisfied and discharged all of its obligations arising
under the $2,000,000,000 364-Day Revolving Credit Agreement, dated as of October 14, 2005,
among the Company, the Agent and the banks named therein, and such agreement shall have been
terminated and be of no further force and effect, evidence of which shall have been made
available to the Agent.

          SECTION 11. EVENTS OF DEFAULT AND THEIR EFFECT.

          Section 11.1. Events of Default. Each of the following shall constitute an Event of
Default under this Agreement:

     11.1.1. Non-Payment of the Loans, etc. Default in the payment when due of any
principal of any Loan or default and continuance thereof for three Business Days in the
payment when due of any interest on any Loan, any fees or any other amounts payable by the
Company hereunder.

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     11.1.2. Non-Payment of Other Indebtedness for Borrowed Money. (a) Default in
the payment when due (subject to any applicable grace period), whether by acceleration or
otherwise, of any principal of, interest on or fees incurred in connection with any other
Indebtedness of, or Guaranteed by, the Company or any Significant Subsidiary (except (i) any
such Indebtedness of any Subsidiary to the Company or to any other Subsidiary and (ii) any
Indebtedness hereunder) and, if a default in the payment of interest or fees, continuance of
such default for five days, in the case of interest, or 30 days, in the case of fees, or (b)
default in the performance or observance of any obligation or condition with respect to any
such other Indebtedness if the effect of such default (subject to any applicable grace
period) is to accelerate the maturity of any such Indebtedness; provided,
however, that the aggregate principal amount of all Indebtedness as to which there
has occurred any default as described above shall equal or exceed $50,000,000.

     11.1.3. Bankruptcy, Insolvency, etc. The Company or any Significant
Subsidiary becomes insolvent or generally fails to pay, or admits in writing its inability
or refusal to pay, debts as they become due; or the Company or any Significant Subsidiary
applies for, consents to, or acquiesces in the appointment of a trustee, receiver or other
custodian for the Company or such Significant Subsidiary or any property thereof, or makes a
general assignment for the benefit of creditors; or, in the absence of such application,
consent or
acquiescence, a trustee, receiver or other custodian is appointed for the Company or
any Significant Subsidiary or for a substantial part of the property of any thereof and is
not discharged within 60 days; or any warrant of attachment or similar legal process is
issued against any substantial part of the property of the Company or any of its Significant
Subsidiaries which is not released within 60 days of service; or any bankruptcy,
reorganization, debt arrangement, or other case or proceeding under any bankruptcy or
insolvency law, or any dissolution or liquidation proceeding (except the voluntary
dissolution, not under any bankruptcy or insolvency law, of a Significant Subsidiary), is
commenced in respect of the Company or any Significant Subsidiary, and, if such case or
proceeding is not commenced by the Company or such Significant Subsidiary it is consented to
or acquiesced in by the Company or such Significant Subsidiary or remains for 60 days
undismissed; or the Company or any Significant Subsidiary takes any corporate action to
authorize, or in furtherance of, any of the foregoing.

     11.1.4. Non-Compliance with this Agreement. Failure by the Company to comply
with or to perform any of the Company’s covenants herein or any other provision of this
Agreement (and not constituting an Event of Default under any of the other provisions of
this Section 11.1) and continuance of such failure for 60 days (or, if the Company failed to
give notice of such noncompliance or nonperformance pursuant to Section 9.1.4 within one
Business Day after obtaining actual knowledge thereof, 60 days less the number of days
elapsed between the date the Company obtained such actual knowledge and the date the Company
gives the notice pursuant to Section 9.1.4, but in no event less than one Business Day)
after notice thereof to the Company from the Agent, any Bank, or the holder of any Note.

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     11.1.5. Representations and Warranties. Any representation or warranty made by
the Company herein is untrue or misleading in any material respect when made or deemed made;
or any schedule, statement, report, notice, or other writing furnished by the Company to the
Agent or any Bank is false or misleading in any material respect on the date as of which the
facts therein set forth are stated or certified; or any certification made or deemed made by
the Company to the Agent or any Bank is untrue or misleading in any material respect on or
as of the date made or deemed made.

     11.1.6. Employee Benefit Plans. The occurrence of any of the following events,
provided that such event would reasonably be expected to require payment by the
Company or a Subsidiary of an amount in excess of $10,000,000: (i) the institution by the
Company or any ERISA Affiliate of steps to terminate any Plan, (ii) the institution by the
PBGC of steps to terminate any Plan; or (iii) a contribution failure occurs with respect to
a Plan sufficient to give rise to a lien under Section 302(f) of ERISA securing an amount in
excess of $10,000,000.

     11.1.7. Judgments. There shall be entered against the Company or any
Subsidiary one or more judgments or decrees in excess of $50,000,000 in the aggregate at any
one time outstanding for the Company and all Subsidiaries and all such judgments or decrees
shall not have been vacated, discharged, stayed or bonded pending appeal within 60 days from
the entry thereof, excluding those judgments or decrees for and to the extent to
which the Company or any Subsidiary (i) is insured and with respect to which the
insurer has not denied coverage in writing or (ii) is otherwise indemnified if the terms of
such indemnification are satisfactory to the Required Banks.

     11.1.8. Change of Ownership. AIG shall cease to own beneficially, directly or
indirectly, at least 51% of all of the outstanding shares of the common stock of the
Company.

          Section 11.2. Effect of Event of Default. If any Event of Default described in
Section 11.1.3 shall occur, the Commitments (if they have not theretofore terminated) shall
immediately terminate and all Loans and all interest and other amounts due hereunder shall become
immediately due and payable, all without presentment, demand or notice of any kind; and, in the
case of any other Event of Default, the Agent may, and upon written request of the Required Banks
shall, declare the Commitments (if they have not theretofore terminated) to be terminated and all
Loans and all interest and other amounts due hereunder to be due and payable, whereupon the
Commitments (if they have not theretofore terminated) shall immediately terminate and all Loans and
all interest and other amounts due hereunder shall become immediately due and payable, all without
presentment, demand or notice of any kind. The Agent shall promptly advise the Company and each
Bank of any such declaration, but failure to do so shall not impair the effect of such declaration.

          SECTION 12. THE AGENT.

          Section 12.1. Authorization. Each Bank and the holder of each Loan or interest
therein authorizes the Agent to act on behalf of such Bank or holder to the extent provided herein
and in any other document or instrument delivered hereunder or in connection herewith, and to

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take
such other action as may be reasonably incidental thereto. Subject to the provisions of Section
12.3, the Agent will take such action permitted by any agreement delivered in connection with this
Agreement as may be requested in writing by the Required Banks or if required under Section 13.1,
all of the Banks. The Agent shall promptly remit in immediately available funds to each Bank or
other holder its share of all payments received by the Agent for the account of such Bank or
holder, and shall promptly transmit to each Bank (or share with each Bank the contents of) each
notice it receives from the Company pursuant to this Agreement.

          Section 12.2. Indemnification. The Banks agree to indemnify the Agent in its
capacity as such (to the extent not reimbursed by the Company), ratably according to their
respective Percentages (determined at the time such indemnity is sought), from and against any and
all actions, causes of action, suits, losses, liabilities, damages and expenses which may at any
time (including, without limitation, at any time following the repayment of the Loans) be imposed
on, incurred by or asserted against the Agent in any way relating to or arising out of this
Agreement, or any documents contemplated by or referred to herein or the transactions contemplated
hereby or any action taken or omitted by the Agent under or in connection with any of the
foregoing; provided, that no Bank shall be liable for the payment to the Agent of any
portion of such actions, causes of action, suits, losses, liabilities, damages and expenses
resulting from the Agent’s or its
employees’ or agents’ gross negligence or willful misconduct. Without limiting the foregoing,
subject to Section 13.5 each Bank agrees to reimburse the Agent promptly upon demand for its
ratable share (determined at the time such reimbursement is sought) of any out-of-pocket expenses
(including reasonable counsel fees) incurred by the Agent in such capacity in connection with the
preparation, execution or enforcement of, or legal advice in respect of rights or responsibilities
under, this Agreement or any amendments or supplements hereto or thereto to the extent that the
Agent is not reimbursed for such expenses by the Company. All obligations provided for in this
Section 12.2 shall survive repayment of the Loans, cancellation of the Notes or any termination of
this Agreement.

          Section 12.3. Action on Instructions of the Required Banks. As to any matters not
expressly provided for by this Agreement (including, without limitation, enforcement or collection
of the Loans), the Agent shall not be required to exercise any discretion or take any action, but
the Agent shall in all cases be fully protected in acting or refraining from acting upon the
written instructions from (i) the Required Banks, except for instructions which under the express
provisions hereof must be received by the Agent from all Banks and (ii) in the case of such
instructions, from all Banks. In no event will the Agent be required to take any action which
exposes the Agent to personal liability or which is contrary to this Agreement or applicable law.
The relationship between the Agent and the Banks is and shall be that of agent and principal only
and nothing herein contained shall be construed to constitute the Agent a trustee for any holder of
a Loan or of a participation therein nor to impose on the Agent duties and obligations other than
those expressly provided for herein.

          Section 12.4. Payments. (a) The Agent shall be entitled to assume that each Bank
has made its Loan available in accordance with Section 2.3 or Section 3.2(c), as applicable, unless
such Bank notifies the Agent at its Notice Office prior to 11:00 a.m., New York City time, on the
Funding Date for such Loan that it does not intend to make such Loan available, it being understood
that no such notice shall relieve such Bank of any of its obligations under this

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Agreement. If the
Agent makes any payment to the Company on the assumption that a Bank has made the proceeds of such
Loan available to the Agent but such Bank has not in fact made the proceeds of such Loan available
to the Agent, such Bank shall pay to the Agent on demand an amount equal to the amount of such
Bank’s Loan, together with interest thereon for each day that elapses from and including such
Funding Date to but excluding the Business Day on which the proceeds of such Bank’s Loan become
immediately available to the Agent at its Payment Office prior to 12:00 Noon, New York City time,
at the Federal Funds Rate for each such day, based upon a year of 360 days. A certificate of the
Agent submitted to any Bank with respect to any amounts owing under this Section 12.4(a) shall be
conclusive absent demonstrable error. If the proceeds of such Bank’s Loan are not made available
to the Agent at its Payment Office by such Bank within three Business Days of such Funding Date,
the Agent shall be entitled to recover such amount upon two Business Days’ demand from the Company,
together with interest thereon for each day that elapses from and including such Funding Date to
but excluding the Business Day on which such proceeds become immediately available to the Agent
prior to 12:00 Noon, New York City time, (i) in the case of a Bid Loan, at the rate per annum
applicable thereto and (ii) in the case of a Committed Loan, at the rate per annum applicable to
Base Rate Loans hereunder, in either case based upon a year of 360 days. Nothing in this paragraph
(a) shall relieve any Bank of any
obligation it may have hereunder to make any Loan or prejudice any rights which the Company
may have against any Bank as a result of any default by such Bank hereunder.

          (b) The Agent shall be entitled to assume that the Company has made all payments due
hereunder from the Company on the due date thereof unless it receives notification prior to any
such due date from the Company that the Company does not intend to make any such payment, it being
understood that no such notice shall relieve the Company of any of its obligations under this
Agreement. If the Agent distributes any payment to a Bank hereunder in the belief that the Company
has paid to the Agent the amount thereof but the Company has not in fact paid to the Agent such
amount, such Bank shall pay to the Agent on demand (which shall be made by facsimile or personal
delivery) an amount equal to the amount of the payment made by the Agent to such Bank, together
with interest thereon for each day that elapses from and including the date on which the Agent made
such payment to but excluding the Business Day on which the amount of such payment is returned to
the Agent at its Payment Office in immediately available funds prior to 12:00 Noon, New York City
time, at the Federal Funds Rate for each such day, based upon a year of 360 days. If the amount of
such payment is not returned to the Agent in immediately available funds within three Business Days
after demand by the Agent, such Bank shall pay to the Agent on demand an amount calculated in the
manner specified in the preceding sentence after substituting the term “Base Rate” for the term
“Federal Funds Rate”. A certificate of the Agent submitted to any Bank with respect to amounts
owing under this Section 12.4(b) shall be conclusive absent demonstrable error.

          Section 12.5. Exculpation. The Agent shall be entitled to rely upon advice of
counsel concerning legal matters, and upon this Agreement and any Note, security agreement,
schedule, certificate, statement, report, notice or other writing which it believes to be genuine
or to have been presented by a proper person. Neither the Agent nor any of its directors,
officers, employees or agents shall (i) be responsible for any recitals, representations or
warranties contained in, or for the execution, validity, genuineness, effectiveness or
enforceability of, this

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Agreement, any Note or any other instrument or document delivered hereunder
or in connection herewith, (ii) be deemed to have knowledge of an Event of Default or Unmatured
Event of Default until after having received actual notice thereof from the Company or a Bank,
(iii) be under any duty to inquire into or pass upon any of the foregoing matters, or to make any
inquiry concerning the performance by the Company or any other obligor of its obligations or (iv)
in any event, be liable as such for any action taken or omitted by it or them, except for its or
their own gross negligence or willful misconduct. The agency hereby created shall in no way impair
or affect any of the rights and powers of, or impose any duties or obligations upon, the Agent in
its individual capacity.

          Section 12.6. Credit Investigation. Each Bank acknowledges, and shall cause each
Assignee or Participant to acknowledge in its assignment or participation agreement with such Bank,
that it has (i) made and will continue to make such inquiries and has taken and will take such care
on its own behalf as would have been the case had the Loans been made directly by such Bank or
other applicable Person to the Company without the intervention of the Agent or any other Bank and
(ii) independently and without reliance upon the Agent or any other Bank, and based on such
documents and information as it has deemed appropriate, made and will continue to make its
own credit analysis and decisions relating to this Agreement. Each Bank agrees and
acknowledges, and shall cause each Assignee or Participant to agree and acknowledge in its
assignment or participation agreement with such Bank, that the Agent makes no representations or
warranties about the creditworthiness of the Company or any other party to this Agreement or with
respect to the legality, validity, sufficiency or enforceability of this Agreement or any Note.

          Section 12.7. CUSA and Affiliates. CUSA and each of its successors as Agent shall
have the same rights and powers hereunder as any other Bank and may exercise or refrain from
exercising the same as though it were not the Agent, and CUSA and any such successor and its
Affiliates may accept deposits from, lend money to and generally engage, and continue to engage, in
any kind of business with the Company or any Affiliate thereof as if CUSA or such successor were
not the Agent hereunder.

          Section 12.8. Resignation. The Agent may resign as such at any time upon at least 30
days’ prior notice to the Company and the Banks. In the event of any such resignation, Banks
having an aggregate Percentage of more than 50% shall as promptly as practicable appoint a
successor Agent from among the Banks reasonably acceptable to the Company (no such acceptance being
required if an Event of Default has occurred and is continuing). If no successor Agent shall have
been so appointed, and shall have accepted such appointment, within 30 days after the retiring
Agent’s giving of notice of resignation, then the retiring Agent may, on behalf of the Banks,
appoint a successor Agent from among the Banks reasonably acceptable to the Company (no such
acceptance being required if an Event of Default has occurred and is continuing), which shall be a
commercial bank organized under the laws of the United States of America or of any State thereof or
under the laws of another country which is doing business in the United States of America and
having a combined capital, surplus and undivided profits of at least $1,000,000,000. Upon the
acceptance of any appointment as Agent hereunder by a successor agent, such successor Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges and duties of the
retiring Agent, and the retiring Agent shall be

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discharged from all further duties and obligations
under this Agreement. After any retiring Agent’s resignation hereunder as Agent, the provisions of
this Section 12 shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Agent under this Agreement.

          Section 12.9. The Register; the Notes.

          (a) The Agent, acting on behalf of the Company, shall maintain a register for the inscription
of the names and addresses of Banks and the Commitments and Loans of each Bank from time to time
(the “Register”). The Company, the Banks, and the Agent may treat each Person whose name
is inscribed in the Register as a Bank hereunder for all purposes of this Agreement. The Register
shall be available for inspection by the Company, the Agent, or any Bank at any reasonable time and
from time to time upon reasonable prior notice.

          (b) The Agent shall inscribe in the Register the Commitments and the Bid Loans and Committed
Loans from time to time of each Bank, the amount of each Bank’s participation in outstanding Bid
Loans and Committed Loans and each repayment or prepayment in respect of
the principal amount of the Bid Loans and Committed Loans of each Bank, the principal amount
owing from time to time by the Company in respect of each Bid Loan and each Committed Loan to each
Bank of such Loans and the dates on which the Loan Period for each such Loan shall begin and end.
Any such inscription shall be conclusive and binding on the Company and each Bank, absent manifest
or demonstrable error; provided that failure to make any such inscription, or any error in
such inscription, shall not affect any of the Company’s obligations in respect of the applicable
Loans. The inscription in the Register of the principal amount owing from time to time by the
Company in respect of each Loan shall constitute an unconditional and irrevocable covenant by the
Company in favor of the Person whose name is so inscribed as the Bank in respect of such Loan that
the Company will make all payments of principal and interest in respect of the Loan in accordance
with this Agreement, make all other payments required by this Agreement to be made by it in respect
of such Loan and otherwise perform all of its obligations under this Agreement in full and by the
due date.

          (c) Each Bank shall record on its internal records the amount of each Loan made by it and
each payment in respect thereof; provided that in the event of any inconsistency between
the Register and any Bank’s records, the inscriptions in the Register shall govern, absent manifest
or demonstrable error.

          (d) If so requested by any Bank by written notice to the Company (with a copy to Agent) at
least two Business Days prior to the Closing Date or at any time thereafter, the Company shall
execute and deliver to such Bank (and/or, if so specified in such notice, any Person who is an
assignee of such Bank pursuant to Section 13.4.1 hereof) promptly after receipt of such notice, a
Bid Note or Committed Note, as applicable, substantially in the form of Exhibit D or
Exhibit E hereto, respectively.

          SECTION 13. GENERAL.

          Section 13.1. Waiver; Amendments. No delay on the part of the Agent, any Bank, or
the holder of any Loan in the exercise of any right, power or remedy shall operate as a waiver
thereof, nor shall any single or partial exercise by any of them of any right, power or remedy
preclude other or further exercise thereof, or the exercise of any other right, power or

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remedy. No amendment, modification or waiver of, or consent with respect to, any provision of this
Agreement or the Notes shall in any event be effective unless the same shall be in writing and
signed and delivered by the Agent and by Banks having an aggregate Percentage of not less than the
aggregate Percentage expressly designated herein with respect thereto or, in the absence of such
designation as to any provision of this Agreement or the Notes, by the Required Banks, and then any
amendment, modification, waiver or consent shall be effective only in the specific instance and for
the specific purpose for which given. No amendment, modification, waiver or consent (i) shall
extend (other than in accordance with Section 13.8(a)) or increase the amount of the Commitments,
extend the maturity of any Commitment or Loan, change the definition of “Required Banks” or
“Percentage” in Section 1, amend or modify Section 4.1, or change any of the defined terms used in
Section 4.1, amend or modify Section 4.4, Section 4.5, Section 4.7, Section 6.2(a), Section 11.1.1,
Section 11.1.8, or this Section 13.1 or otherwise change the aggregate Percentage required to
effect an amendment, modification, waiver or consent without the written consent of all Banks, (ii)
shall modify or waive any of the conditions precedent specified in Section 10.1 for
the making of any Loan without the written consent of the Bank which is to make such Loan or
(iii) shall extend the scheduled maturity or reduce the principal amount of, or rate of interest
on, reduce or waive any fee hereunder or extend the due date for or waive any amount payable under,
any Loan without the written consent of the holder of the Commitment or Loan adversely affected
thereby. Amendments, modifications, waivers and consents of the type described in clause (iii) of
the preceding sentence with respect to Bid Loans or Bid Notes may be effected with the written
consent of the holder of such Bid Loans or Bid Notes and no consent of any other Bank or other
holder shall be required in connection therewith. No provisions of Section 12 shall be amended,
modified or waived without the Agent’s written consent.

          Section 13.2. Notices.

          (a) Subject to paragraphs (b) through (f) of this Section, all notices, requests and demands
to or upon the respective parties hereto to be effective shall be either (x) in writing (including
by telecopy, encrypted or unencrypted) or (y) as and to the extent set forth in Section 13.2(b) and
in the proviso to this Section 13.2(a) and, unless otherwise expressly provided herein, shall be
deemed to have been duly given or made when delivered or, in the case of telecopy or e-mail notice,
when received, addressed to the Company, the Agent or such Bank (or other holder) at its address
shown across from its name on Schedule III hereto or at such other address as it may, by written
notice received by the other parties to this Agreement, have designated as its address for such
purpose; provided, that notices hereunder shall not be given or made to the Company by e-mail;
provided, further, that any notice, request or demand to or upon the Agent or the Banks pursuant to
Sections 2.2(a), 3.2(a) or 5.2 shall not be effective until received.

          (b) The Company hereby agrees that, unless otherwise requested by the Agent, it will provide
to the Agent all information, documents and other materials that it is obligated to furnish to the
Agent pursuant to this Agreement, including, without limitation, all notices, requests, financial
statements, financial and other reports, certificates and other information materials, but
excluding any such communication that (i) relates to a request for a new, or a

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conversion of an existing, borrowing or other extension of credit (including any election of an interest rate or
interest period relating thereto), (ii) relates to the payment of any principal or other amount due
under this Agreement prior to the scheduled date therefor, (iii) provides notice of any Unmatured
Event of Default or Event of Default under this Agreement, (iv) is required to be delivered to
satisfy any condition precedent to the effectiveness of this Agreement and/or any borrowing or
other extension of credit hereunder or (v) initiates or responds to legal process (all such
non-excluded information being referred to herein collectively as the “Communications”) by
transmitting the Communications in an electronic/soft medium (with such Communications to contain
any required signatures) in a format acceptable to the Agent to
oploanswebadmin@citigroup.com (or such other e-mail address designated by the Agent from
time to time); provided that if requested in writing by any Bank, the Company will provide to such
Bank a hard copy of its financial statements required to be provided hereunder.

          (c) Each party hereto agrees that the Agent may make the Communications available to the Banks
by posting the Communications on IntraLinks or another relevant website, if any, to which each Bank
and the Agent have access (whether a commercial, third-party
website or whether sponsored by the Agent) (the “Platform”). Nothing in this Section
13.2 shall prejudice the right of the Agent to make the Communications available to the Banks in
any other manner specified in this Agreement.

          (d) The Company hereby acknowledges that certain of the Banks may be “public-side” Banks
(i.e., Banks that do not wish to receive material non-public information with respect to the
Company or its securities) (each, a “Public Bank”). The Borrower hereby agrees that (i)
Communications that are to be made available on the Platform to Public Banks shall be clearly and
conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC” shall appear
prominently on the first page thereof, (ii) by marking Communications “PUBLIC,” the Company shall
be deemed to have authorized the Agent and the Banks to treat such Communications as either
publicly available information or not material information (although it may be sensitive and
proprietary) with respect to the Company or its securities for purposes of United States Federal
and state securities laws, (iii) all Communications marked “PUBLIC” are permitted to be made
available through a portion of the Platform designated “Public Bank,” and (iv) the Agent shall be
entitled to treat any Communications that are not marked “PUBLIC” as being suitable only for
posting on a portion of the Platform not designated “Public Bank.”

          (e) Each Bank agrees that e-mail notice to it (at the address provided pursuant to the next
sentence and deemed delivered as provided in the next paragraph) specifying that Communications
have been posted to the Platform shall constitute effective delivery of such Communications to such
Bank for purposes of this Agreement. Each Bank agrees (i) to notify the Agent in writing
(including by electronic communication) from time to time to ensure that the Agent has on record an
effective e-mail address for such Bank to which the foregoing notice may be sent by electronic
transmission and (ii) that the foregoing notice may be sent to such e-mail address.

          (f) Each party hereto acknowledges that (i) the distribution of material through an electronic
medium is not necessarily secure and that there are confidentiality and other risks associated with
such distribution, (ii) the Platform is provided “as is” and “as available,” (iii)

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none of the Agent, its affiliates nor any of their respective officers, directors, employees, agents, advisors
or representatives (collectively, the “Citigroup Parties”) warrants the adequacy, accuracy
or completeness of the Communications or the Platform, and each Citigroup Party expressly disclaims
liability for errors or omissions in any Communications or the Platform, and (iv) no warranty of
any kind, express, implied or statutory, including, without limitation, any warranty of
merchantability, fitness for a particular purpose, non-infringement of third party rights or
freedom from viruses or other code defects, is made by any Citigroup Party in connection with any
Communications or the Platform.

          Section 13.3. Computations. Where the character or amount of any asset or liability
or item of income or expense is required to be determined, or any consolidation or other accounting
computation is required to be made, for the purpose of this Agreement, such determination or
calculation shall, at any time and to the extent applicable and except as otherwise specified in
this Agreement, be made in accordance with generally accepted accounting principles in the United
States of America applied on a basis consistent with those in effect as at the date of the
Company’s audited financial statements referred to in Section 8.4. If there should be any material
change in generally accepted accounting principles in the United States of America after the date hereof
which materially affects the financial covenants in this Agreement, the parties hereto agree to
negotiate in good faith appropriate revisions of such covenants (it being understood, however, that
such covenants shall remain in full force and effect in accordance with their existing terms
pending the execution by the Company and the Required Banks of any such amendment).

          Section 13.4. Assignments; Participations. Each Bank may assign, or sell
participations in, its Loans and its Commitment to one or more other Persons in accordance with
this Section 13.4 (and the Company consents to the disclosure of any information obtained by any
Bank in connection herewith to any actual or prospective Assignee or Participant).

          Section 13.4.1. Assignments. Any Bank may with the written consents of the Company
and the Agent (which consents will not be unreasonably withheld or delayed) at any time assign and
delegate to one or more Eligible Assignees (any Person to whom an assignment and delegation is made
being herein called an “Assignee”) all or any fraction of such Bank’s Loans and Commitment
(which assignment and delegation shall be of a constant, and not a varying, percentage of such
assigning Bank’s Loans and Commitment); each such assignment of a Bank’s Commitment shall be in the
minimum amount of $10,000,000 or in integral multiples of $1,000,000 in excess thereof;
provided, that any such Assignee will comply, if applicable, with the provisions contained
in the first sentence of Section 6.4(b) and in Section 6.4(c), Section 6.4(d), Section 6.4(e) and
Section 6.4(g) and shall be deemed to have made, on the date of the effectiveness of such
assignment and delegation, the representation and warranty set forth in the second sentence of
Section 6.4(b); and provided, further, that the Company and the Agent shall be
entitled to continue to deal solely and directly with such assigning Bank in connection with the
interests so assigned and delegated to an Assignee until such assigning Bank and/or such Assignee
shall have:

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     (i) given written notice of such assignment and delegation, together with
payment instructions, addresses and related information with respect to such
Assignee, substantially in the form of Exhibit I, to the Company and the Agent;

     (ii) provided evidence satisfactory to the Company and the Agent that, as of
the date of such assignment and delegation, the Company will not be required to pay
any costs, fees, taxes or other amounts of any kind or nature with respect to the
interest assigned in excess of those payable by the Company with respect to such
interest prior to such assignment;

     (iii) paid to the Agent for the account of the Agent a processing fee of
$3,500; and

     (iv) provided to the Agent evidence reasonably satisfactory to the Agent that
the assigning Bank has complied with the provisions of the last sentence of Section
12.6.

Upon receipt of the foregoing items and the consents of the Company and the Agent, and subject to
the acceptance and recordation of the assignment by the Agent pursuant to Section 12.9, (x)
the Assignee shall be deemed automatically to have become a party hereto and, to the extent that
rights and obligations hereunder have been assigned and delegated to such Assignee, such Assignee
shall have the rights and obligations of a Bank hereunder and under the other instruments and
documents executed in connection herewith and (y) the assigning Bank, to the extent that rights and
obligations hereunder have been assigned and delegated by it, shall be released from its
obligations hereunder. The Agent may from time to time (and upon the request of the Company or any
Bank after any change therein shall) distribute a revised Schedule I indicating any changes in the
Banks party hereto or the respective Percentages of such Banks and update the Register. Within
five Business Days after the Company’s receipt of notice from the Agent of the effectiveness of any
such assignment and delegation, if requested by the Assignee in accordance with Section 12.9, the
Company shall execute and deliver to the Agent (for delivery to the relevant Assignee) new Notes in
favor of such Assignee and, if the assigning Bank has retained Loans and a Commitment hereunder and
if so requested by such Bank in accordance with Section 12.9, replacement Notes in favor of the
assigning Bank (such Notes to be in exchange for, but not in payment of, the Notes previously held
by such assigning Bank). Each such Note shall be dated the date of the predecessor Notes. The
assigning Bank shall promptly mark the predecessor Notes, if any, “exchanged” and deliver them to
the Company. Any attempted assignment and delegation not made in accordance with this Section
13.4.1 shall be null and void.

          The foregoing consent requirement shall not be applicable in the case of, and this Section
13.4.1 shall not restrict, any assignment or other transfer by any Bank of all or any portion of
such Bank’s Loans or Commitment to (i) any Federal Reserve Bank (provided, that such
Federal Reserve Bank shall not be considered a “Bank” for purposes of this Agreement) or (ii) any
Affiliate of such Bank (provided, that the assigning or transferring Bank shall give notice
of such assignment or transfer to the Agent and the Company). Further, the foregoing consent

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requirement of the Company shall not be applicable if an Event of Default has occurred and is
continuing.

          The Company, each Bank, and each Assignee acknowledge and agree that after receipt by the
Agent of the items and consents required by this Section each Assignee shall be considered a Bank
for all purposes of this Agreement (including without limitation Sections 6.4, 7.1, 7.4, 13.5 and
13.6) and by its acceptance of an assignment herein, each Assignee agrees to be bound by the
provisions of this Agreement (including without limitation Section 6.4).

          Section 13.4.2. Participations. Any Bank may at any time sell to one or more
commercial banks or other Persons (any such commercial bank or other Person being herein called a
“Participant”) participating interests in any of its Loans, its Commitment or any other
interest of such Bank hereunder; provided, however, that

     (a) no participation contemplated in this Section 13.4.2 shall relieve such Bank from
its Commitment or its other obligations hereunder;

     (b) such Bank shall remain solely responsible for the performance of its Commitment
and such other obligations hereunder and such Bank shall retain the sole right and
responsibility to enforce the obligations of the Company hereunder, including
the right to approve any amendment, modification or waiver of any provision of this
Agreement (subject to Section 13.4.2(d) below);

     (c) the Company and the Agent shall continue to deal solely and directly with such
Bank in connection with such Bank’s rights and obligations under this Agreement;

     (d) no Participant, unless such Participant is an Affiliate of such Bank, or is itself
a Bank, shall be entitled to require such Bank to take or refrain from taking any action
hereunder, except that such Bank may agree with any Participant that such Bank will not,
without such Participant’s consent, take any actions of the type described in the third
sentence of Section 13.1;

     (e) the Company shall not be required to pay any amount under Sections 4.1, 6.4 or 7.1
that is greater than the amount which the Company would have been required to pay had no
participating interest been sold;

     (f) no Participant may further participate any interest in any Committed Loan (and
each participation agreement shall contain a restriction to such effect);

     (g) to the extent permitted by applicable law, each Participant shall be considered a
Bank for purposes of Section 6.4, Section 7.1, Section 7.4, Section 13.5 and Section 13.6
and by its acceptance of a participating interest in any Loan, Commitment or any other
interest of a Bank hereunder, each Participant agrees (i) that it is bound by, and agrees to
deliver all documentation required under, the provisions of Section 6.2(b) and Section 6.4
as if such Participant were a Bank, and (ii) it is not entitled to any benefits

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under Section 6.4 or Section 7.1 unless it is in full compliance with all requirements imposed on
Banks under any of those Sections; and

     (h) such Bank shall have provided to the Agent evidence reasonably satisfactory to the
Agent that such Bank has complied with the provisions of the last sentence of Section 12.6.

     Any Bank (a “Granting Bank”) may grant to a special purpose funding vehicle organized
under the laws of the United States of America or any State thereof (a “SPV”) of such
Granting Bank, identified as such in writing from time to time by the Granting Bank to the Agent
and the Company, the option to provide to the Company all or any part of its Loans that such
Granting Bank would otherwise be obligated to make to the Company pursuant to this Agreement;
provided, that (i) such SPV shall be deemed to be a Participant for purposes of this
Section 13.4.2, (ii) nothing herein shall constitute a commitment by any SPV to make any Loan,
(iii) if a SPV elects not to exercise such option or otherwise fails to provide all or any part of
such Loan, the Granting Bank shall be obligated to make such Loan pursuant to the terms hereof and
(iv) the Company shall not be required to pay any amount under Sections 13.5 or 13.6 that is
greater than the amount which the Company would have been required to pay had such SPV not
provided the Company with any part of any Loan of such Granting Bank. The making of a Loan
by a SPV hereunder shall utilize the Commitment of the Granting Bank to the same extent, and as if,
such Loan were made by such Granting Bank. Each party hereto hereby agrees that no SPV shall be
liable for any indemnity or similar payment obligation under this Agreement (any indemnity,
liability or other payment obligation, including but not limited to any tax liabilities that occur
by reason of such funding by the SPV, shall remain the obligation of the Granting Bank). In
furtherance of the foregoing, each party hereto agrees (which agreement shall survive the
termination of this Agreement) that, prior to the date that is one year and one day after the
payment in full of all outstanding commercial paper or other senior indebtedness of any SPV, it
will not institute against, or join any other Person in instituting against, such SPV any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings under the laws of
the United States or any State thereof. In addition, notwithstanding anything contrary contained
in this Section 13.4.2, any SPV may (i) with notice to, but without the prior written consent of,
the Company and the Agent and without paying any processing fee therefor, assign all or a portion
of its interests in any Loans to the Granting Bank providing liquidity and/or credit support to or
for the account of such SPV to support the funding or maintenance of Loans and (ii) disclose on a
confidential basis any non-public information relating to its Loans to any rating agency,
commercial paper dealer or provider of any surety, guarantee or credit or liquidity enhancement to
such SPV. This paragraph may not be amended without the written consent of any SPV at the time
holding all or any part of any Loans under this Agreement (which consent shall not be unreasonably
withheld or delayed).

          Section 13.5. Costs, Expenses and Taxes. The Company agrees to pay on demand (a) all
reasonable out-of-pocket costs and expenses of the Agent (including the reasonable fees and
out-of-pocket expenses of counsel for the Agent (and of local counsel, if any, who may be retained
by said counsel)), in connection with the preparation, execution, delivery and administration of
this Agreement, the Notes and all other instruments or documents provided for herein or delivered
or to be delivered hereunder or in connection herewith and (b)

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all out-of-pocket costs and expenses
(including reasonable attorneys’ fees and legal expenses and allocated costs of staff counsel)
incurred by the Agent and each Bank in connection with the enforcement of this Agreement, the Notes
or any such other instruments or documents. Each Bank agrees to reimburse the Agent for such
Bank’s pro rata share (based upon its respective Percentage determined at the time such
reimbursement is sought) of any such costs or expenses incurred by the Agent on behalf of all the
Banks and not paid by the Company other than any fees and out-of-pocket expenses of counsel for the
Agent which exceed the amount which the Company has agreed with the Agent to reimburse. In
addition, the Company agrees to pay, and to hold the Agent and the Banks harmless from all
liability for, any stamp or other Taxes which may be payable in connection with the execution and
delivery of this Agreement, the borrowings hereunder, the issuance of the Notes (if any) or the
execution and delivery of any other instruments or documents provided for herein or delivered or to
be delivered hereunder or in connection herewith. All obligations provided for in this Section
13.5 shall survive repayment of the Loans, cancellation of the Notes or any termination of this
Agreement.

          Section 13.6. Indemnification. In consideration of the execution and delivery of
this Agreement by the Agent and the Banks, the Company hereby agrees to indemnify, exonerate and
hold each of the Banks, the Agent, the Affiliates of each of the Banks and the Agent, and each of
the officers, directors, employees and agents of the Banks, the Agent and the Affiliates of each of
the Banks and the Agent (collectively herein called the “Bank Parties” and individually
called a “Bank Party”) free and harmless from and against any and all actions, causes of action, suits, losses,
liabilities, damages and expenses, including, without limitation, reasonable attorneys’ fees and
disbursements (collectively herein called the “Indemnified Liabilities”), incurred by the
Bank Parties or any of them as a result of, or arising out of, or relating to (i) this Agreement,
the Notes (if any) or the Loans or (ii) the direct or indirect use of proceeds of any of the Loans
or any credit extended hereunder, except for any such Indemnified Liabilities arising on account of
such Bank Party’s gross negligence or willful misconduct, and if and to the extent that the
foregoing undertaking may be unenforceable for any reason, the Company hereby agrees to make the
maximum contribution to the payment and satisfaction of each of the Indemnified Liabilities which
is permissible under applicable law. The Company agrees not to assert any claim against the Bank
Parties on any theory of liability, for consequential, indirect, special or punitive damages
arising out of or otherwise relating to this Agreement and the Notes (if any) or any of the
transactions contemplated hereby or thereby or the actual or proposed use of the proceeds of the
Loans. All obligations provided for in this Section 13.6 shall survive repayment of the Loans,
cancellation of the Notes (if any) or any termination of this Agreement.

          Section 13.7. Regulation U. Each Bank represents that it in good faith is not
relying, either directly or indirectly, upon any margin stock (as such term is defined in
Regulation U promulgated by the Board of Governors of the Federal Reserve System) as collateral
security for the extension or maintenance by it of any credit provided for in this Agreement.

          Section 13.8. Extension of Termination Dates; Removal of Banks; Substitution of
Banks. (a) Not more than 60 days nor less than 45 days prior to the then-effective Termination
Date, the Company may, at its option, request all the Banks then party to this Agreement to extend
their scheduled Termination Dates by an additional one year period, or such shorter period as
agreed upon by the Company and the Agent, by means of a letter, addressed to the

Credit Agreement

 

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Agent (who shall promptly deliver such letter to each Bank), substantially in the form of Exhibit J. Each Bank
electing (in its sole discretion) so to extend its scheduled Termination Date shall execute and
deliver not earlier than the 30th day nor later than the 20th day prior to the then-effective
Termination Date counterparts of such letter to the Company and the Agent, who shall notify the
Company, in writing, of the Banks’ decisions no later than 15 days prior to the existing
Termination Date, whereupon (unless Banks with an aggregate Percentage in excess of 25% decline to
extend their respective scheduled Termination Dates, in which event the Agent shall notify all the
Banks thereof and no such extension shall occur) such Bank’s scheduled Termination Date shall be
extended, effective only as of the date that is such Bank’s then-current scheduled Termination
Date, to the date that is one year, or such shorter period as agreed as provided above, after such
Bank’s then-current scheduled Termination Date. Any Bank that declines or fails to respond to the
Company’s request for such extension shall be deemed to have not extended its scheduled Termination
Date.

          (b) With respect to any Bank (i) on account of which the Company is required to make any
deductions or withholdings or pay any additional amounts, as contemplated by Section 6.4, (ii) on
account of which the Company is required to pay any additional amounts, as contemplated by Section
7.1, (iii) for which it is illegal to make a LIBOR Rate Loan, as contemplated by Section 7.3 or
(iv) which has declined to extend such Bank’s scheduled Termination Date and Banks with an aggregate Percentage in excess of 75% have elected to
extend their respective Termination Dates, the Company may in its discretion, upon not less than 30
days’ prior written notice to the Agent and each Bank, remove such Bank as a party hereto. Each
such notice shall specify the date of such removal (which shall be a Business Day and, if such Bank
has any outstanding Bid Loans, shall (unless otherwise agreed by such Bank) be on or after the last
day of the Loan Period for the Bid Loan of such Bank having the latest maturity date), which shall
thereupon become the scheduled Termination Date for such Bank.

          (c) In the event that any Bank does not extend its scheduled Termination Date pursuant to
subsection (a) above or is the subject of a notice of removal pursuant to subsection (b) above,
then, at any time prior to the Termination Date for such Bank (a “Terminating Bank”), the
Company may, at its option, arrange to have one or more other Eligible Assignees (which may be a
Bank or Banks, or if not a Bank, shall be acceptable to the Agent (such acceptance not to be
unreasonably withheld or delayed), and each of which shall herein be called a “Successor
Bank”) with the approval of the Agent (such approval not to be unreasonably withheld or
delayed) succeed to all or a percentage of the Terminating Bank’s outstanding Loans, if any, and
rights under this Agreement and assume all or a like percentage (as the case may be) of such
Terminating Bank’s undertaking to make Loans pursuant hereto and other obligations hereunder (as if
(i) in the case of any Bank electing not to extend its scheduled Termination Date pursuant to
subsection (a) above, such Successor Bank had extended its scheduled Termination Date pursuant to
such subsection (a) and (ii) in the case of any Bank that is the subject of a notice of removal
pursuant to sub-section (b) above, no such notice of removal had been given by the Company);
provided, that prior to replacing any Terminating Bank with any Successor Bank, the Company
shall have given each Bank which has agreed to extend its Termination Date an opportunity to
increase its Commitment by all or a portion of the Terminating Banks’ Commitments. Such succession
and assumption shall be effected by means of one or more agreements supplemental to this Agreement
among the Terminating Bank, the Successor Bank,

Credit Agreement

 

-51-

the Company and the Agent. On and as of the
effective date of each such supplemental agreement (i) each Successor Bank party thereto shall be
and become a Bank for all purposes of this Agreement and to the same extent as any other Bank
hereunder and shall be bound by and entitled to the benefits of this Agreement in the same manner
as any other Bank and (ii) the Company agrees to pay to the Agent for the account of the Agent a
processing fee of $2,500 for each such Successor Bank which is not a Bank.

          (d) On the Termination Date for any Terminating Bank, such Terminating Bank’s Commitment
shall terminate and the Company shall pay in full all of such Terminating Bank’s Loans (except to
the extent assigned pursuant to subsection (c) above) and all other amounts payable to such Bank
hereunder (including any amounts payable pursuant to Section 7.4 on account of such payment);
provided, that if an Event of Default or Unmatured Event of Default exists on the date
scheduled as any Terminating Bank’s Termination Date, payment of such Terminating Bank’s Loans
shall be postponed to (and, for purposes of calculating facility fees under Section 4.4,
utilization fees under Section 4.5 and determining the Required Banks (except as provided below),
but for no other purpose, such Terminating Bank’s Commitment shall continue until) the first
Business Day thereafter on which (i) no Event of Default or Unmatured Event of Default exists
(without regard to any waiver or amendment that makes this Agreement less restrictive for the
Company, other than as described in clause (ii) below) or (ii) the Required Banks (which for purposes of this subsection (d) shall be determined based upon the respective
Percentages and aggregate Commitments of all Banks other than any Terminating Bank whose scheduled
Termination Date has been extended pursuant to this proviso) waive or amend the provisions of this
Agreement to cure all existing Events of Default or Unmatured Events of Default or agree to permit
any borrowing hereunder notwithstanding the existence of any such event. In the event that CUSA or
its Affiliates shall become a Terminating Bank, the Required Banks with the consent of the Company
(which consent shall not be unreasonably withheld or delayed) shall appoint another Bank or other
Person as Agent, which shall have all of the rights and obligations of the Agent upon the effective
date of and pursuant to an agreement supplemental hereto among the Company and the Banks, and
thereupon CUSA, as Agent, shall be relieved from its obligations as Agent hereunder, it being
understood that the provisions of Section 12 shall inure to the benefit of CUSA as to any actions
taken or omitted to be taken by it while it was Agent under this Agreement. If no such successor
Agent shall be appointed within 30 days of the Termination Date of the Agent, then the Agent shall,
on behalf of the Banks, appoint a successor Agent in accordance with the provisions set forth in
Section 12.8 for a resigning Agent.

          (e) To the extent that all or a portion of any Terminating Bank’s obligations are not assumed
pursuant to subsection (c) above, the Aggregate Commitment shall be reduced on the applicable
Termination Date and each Bank’s percentage of the reduced Aggregate Commitment shall be revised
pro rata to reflect such Terminating Bank’s absence. The Agent shall distribute a
revised Schedule I indicating such revisions promptly after the applicable Termination Date and
update the Register accordingly. Such revised Schedule I shall be deemed conclusive in the absence
of demonstrable error.

Credit Agreement

 

-52-

          (f) The Agent agrees to use reasonable commercial efforts to assist the Company in locating
one or more commercial banks or other financial institutions to replace any Terminating Bank prior
to such Terminating Bank’s Termination Date.

          Section 13.9. Captions. Section captions used in this Agreement are for convenience
only and shall not affect the construction of this Agreement.

          Section 13.10. Governing Law; Severability. THIS AGREEMENT AND EACH NOTE SHALL BE A
CONTRACT MADE UNDER, GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK.
All obligations of the Company and the rights of the Agent, the Banks and any other holders of the
Loans expressed herein or in the Notes (if any) shall be in addition to and not in limitation of
those provided by applicable law. Whenever possible each provision of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law, but if any provision
of this Agreement shall be prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of
such provision or the remaining provisions of this Agreement.

          Section 13.11. Counterparts; Effectiveness. This Agreement may be executed in any number of counterparts and by the different parties
on separate counterparts and each such counterpart shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same Agreement. When counterparts of this
Agreement executed by each party shall have been lodged with the Agent (or, in the case of any Bank
as to which an executed counterpart shall not have been so lodged, the Agent shall have received
facsimile or other written confirmation of execution of a counterpart hereof by such Bank), this
Agreement shall become effective as of the date hereof and the Agent shall so inform all of the
parties hereto.

          Section 13.12. Further Assurances. The Company agrees to do such other acts and
things, and to deliver to the Agent and each Bank such additional agreements, powers and
instruments, as the Agent or any Bank may reasonably require or deem advisable to carry into effect
the purposes of this Agreement or to better assure and confirm unto the Agent and each Bank their
respective rights, powers and remedies hereunder.

          Section 13.13. Successors and Assigns. This Agreement shall be binding upon the
Company, the Banks and the Agent and their respective successors and assigns, and shall inure to
the benefit of the Company, the Banks and the Agent and the respective successors and assigns of
the Banks and the Agent. The Company may not assign any of its rights or delegate any of its
duties under this Agreement without the prior written consent of all of the Banks.

          Section 13.14. Waiver of Jury Trial. THE COMPANY, THE AGENT AND EACH BANK HEREBY
WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS
UNDER THIS AGREEMENT, ANY NOTE OR ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR
WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR ARISING FROM ANY BANKING
RELATIONSHIP EXISTING IN

Credit Agreement

 

-53-

CONNECTION WITH THIS AGREEMENT, AND AGREE THAT ANY SUCH ACTION OR
PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.

          Section 13.15. No Fiduciary Relationship. The Company acknowledges that neither the
Agent nor any Bank has any fiduciary relationship with, or fiduciary duty to, the Company arising
out of or in connection with this Agreement, the Notes (if any) or the transactions contemplated
hereby, and the relationship between the Agent and the Banks, on the one hand, and the Company, on
the other, in connection herewith or therewith is solely that of creditor and debtor. This
Agreement does not create a joint venture among the parties.

          Section 13.16. USA PATRIOT Act. Each Bank hereby notifies the Company that pursuant
to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October
26, 2001)) (the “Act”), it is required to obtain, verify and record information that
identifies the Company, which information includes the name and address of the Company and other
information that will allow such Bank to identify the Company in accordance with the Act.

Credit Agreement

 

-54-

          IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year
first above written.

	 	 	 	 	 
	 	

INTERNATIONAL LEASE FINANCE CORPORATION 

 	 
	 	By:  	/s/ Alan H. Lund
 	 
	 	 	Name:  	Alan H. Lund 	 
	 	 	Title:  	Vice Chairman and Chief Financial Officer 	 
	 

	 	 	 	 	 
	 	 	 
	 	By:  	            /s/ Pamela S. Hendry
 	 
	 	 	Name:  	Pamela S. Hendry 	 
	 	 	Title:  	Senior Vice President and Treasurer 	 
	 

Credit Agreement

 

-55-

AGENT

	 	 	 	 	 
	 	CITICORP USA, INC.

 	 
	 	By:  	                    /s/ Peter C. Bickford
 	 
	 	 	Name:  	Peter C. Bickford 	 
	 	 	Title:  	Vice President 	 
	 

Credit Agreement

 

-56-

BANKS

	 	 	 	 	 
	 	CITICORP USA, INC.

 	 
	 	By:  	/s/ Peter C. Bickford
 	 
	 	 	Name:  	Peter C. Bickford 	 
	 	 	Title:  	Vice President 	 
	 

Credit Agreement

 

-57-

	 	 	 	 	 
	 	BANK OF AMERICA, N.A.

 	 
	 	By:  	/s/ Jason Cassity
 	 
	 	 	Name:  	Jason Cassity 	 
	 	 	Title:  	Vice President 	 
	 

Credit Agreement

 

-58-

	 	 	 	 	 
	 	THE GOVERNOR AND COMPANY OF THE BANK OF SCOTLAND

 	 
	 	By:  	/s/
Robert Buck 	 
	 	 	Name:  	Robert Buck 	 
	 	 	Title:  	Director Aircraft Finance 	 
	 

Credit Agreement

 

-59-

	 	 	 	 	 
	 	CREDIT SUISSE, CAYMAN ISLANDS BRANCH

 	 
	 	By:  	/s/ Jay Chall
 	 
	 	 	Name:  	Jay Chall 	 
	 	 	Title:  	Director 	 
	 

	 	 	 	 	 
	 	 	 
	 	By:  	                 /s/ James Neira
 	 
	 	 	Name:  	James Neira 	 
	 	 	Title:  	Associate 	 
	 

Credit Agreement

 

-60-

	 	 	 	 	 
	 	HSBC BANK USA, NATIONAL ASSOCIATION

 	 
	 	By:  	/s/ Kenneth Johnson
 	 
	 	 	Name:  	Kenneth Johnson 	 
	 	 	Title:  	Senior Vice President 	 
	 

Credit Agreement

 

-61-

	 	 	 	 	 
	 	JPMORGAN CHASE BANK, N.A.

 	 
	 	By:  	/s/ Matthew H. Massie
 	 
	 	 	Name:  	Matthew H. Massie 	 
	 	 	Title:  	Managing Director 	 
	 

Credit Agreement

 

-62-

	 	 	 	 	 
	 	ABN AMRO BANK N.V.

 	 
	 	By:  	/s/ Neil R. Stein
 	 
	 	 	Name:  	Neil R. Stein 	 
	 	 	Title:  	Director 	 
	 

	 	 	 	 	 
	 	 	 
	 	By:  	                       /s/ Michael DeMarco
 	 
	 	 	Name:  	Michael DeMarco 	 
	 	 	Title:  	Vice President 	 
	 

Credit Agreement

 

-63-

	 	 	 	 	 
	 	AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED

 	 
	 	By:  	/s/ John Wade
 	 
	 	 	Name:  	John Wade 	 
	 	 	Title:  	Director 	 
	 

Credit Agreement

 

-64-

	 	 	 	 	 
	 	BNP PARIBAS

 	 
	 	By:  	/s/ Marguerite L. Leson
 	 
	 	 	Name:  	Marguerite L. Leson 	 
	 	 	Title:  	Vice President 	 
	 

	 	 	 	 	 
	 	 	 
	 	By:  	                      /s/ Phil Truesdale
 	 
	 	 	Name:  	Phil Truesdale 	 
	 	 	Title:  	Managing Director 	 
	 

Credit Agreement

 

-65-

	 	 	 	 	 
	 	BANCO SANTANDER CENTRAL HISPANO, S.A., NEW YORK

BRANCH

 	 
	 	By:  	/s/ Miguel Gonzalo
 	 
	 	 	Name:  	Miguel Gonzalo 	 
	 	 	Title:  	Vice President 	 
	 

	 	 	 	 	 
	 	 	 
	 	By:  	                         /s/ Sen Louie
 	 
	 	 	Name:  	Sen Louie 	 
	 	 	Title:  	Vice President 	 
	 

Credit Agreement

 

 

-66-

	 	 	 	 	 
	 	THE BANK OF TOKYO-MITSUBISHI UFJ, LTD., NEW YORK BRANCH

 	 
	 	By:  	/s/ Cosmas Bonaparte
 	 
	 	 	Name:  	Cosmas Bonaparte 	 
	 	 	Title:  	Authorized Signatory 	 
	 

Credit Agreement

 

-67-

	 	 	 	 	 
	 	BARCLAYS BANK PLC

 	 
	 	By:  	/s/ Alison McGuigan
 	 
	 	 	Name:  	Alison McGuigan 	 
	 	 	Title:  	Associate Director 	 
	 

Credit Agreement

 

-68-

	 	 	 	 	 	 	 	 	 
	 	 	DEUTSCHE BANK AG, NEW YORK BRANCH	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ruth Leung
	 	/s/ Richard Herder
	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name: Ruth Leung
	 	Richard Herder	 	 
	 

	 	 	 	Title: Director
	 	Managing Director	 	 

Credit Agreement

 

-69-

	 	 	 	 	 
	 	LEHMAN BROTHERS COMMERCIAL BANK

 	 
	 	By:  	/s/ George Janes
 	 
	 	 	Name:  	George Janes 	 
	 	 	Title:  	Chief Credit Officer 	 
	 

Credit Agreement

 

-70-

	 	 	 	 	 
	 	MERRILL LYNCH BANK USA

 	 
	 	By:  	/s/ Louis Alder
 	 
	 	 	Name:  	Louis Alder 	 
	 	 	Title:  	Director 	 
	 

Credit Agreement

 

-71-

	 	 	 	 	 
	 	MORGAN STANLEY BANK

 	 
	 	By:  	/s/ Daniel Twenge
 	 
	 	 	Name:  	Daniel Twenge 	 
	 	 	Title:  	Authorized Signatory
Morgan Stanley Bank 	 
	 

Credit Agreement

 

-72-

	 	 	 	 	 
	 	ROYAL BANK OF CANADA

 	 
	 	By:  	/s/ John E. Beckwith
 	 
	 	 	Name:  	John E. Beckwith 	 
	 	 	Title:  	Authorized Signatory 	 
	 

Credit Agreement

 

-73-

	 	 	 	 	 
	 	SOCIETE GENERALE

 	 
	 	By:  	/s/ Nigel Elvey
 	 
	 	 	Name:  	Nigel Elvey 	 
	 	 	Title:  	Vice President 	 
	 

Credit Agreement

 

-74-

	 	 	 	 	 
	 	TORONTO DOMINION (TEXAS) LLC

 	 
	 	By:  	/s/ Debbi L. Brito
 	 
	 	 	Name:  	Debbi L. Brito 	 
	 	 	Title:  	Authorized Signatory 	 
	 

Credit Agreement

 

-75-

	 	 	 	 	 
	 	UBS LOAN FINANCE LLC

 	 
	 	By:  	/s/ Richard L. Tavrow
 	 
	 	 	Name:  	Richard L. Tavrow 	 
	 	 	Title:  	Director
Banking Products Services, US 	 
	 
	 	 	 
	 	By:  	                     /s/ Irja R. Otsa
 	 
	 	 	Name:  	Irja R. Otsa 	 
	 	 	Title:  	Associate Director
Banking Products, US 	 
	 

Credit Agreement

 

-76-

	 	 	 	 	 
	 	WACHOVIA BANK, NATIONAL ASSOCIATION

 	 
	 	By:  	/s/ Grainne Pergolini
 	 
	 	 	Name:  	Grainne Pergolini 	 
	 	 	Title:  	Vice President 	 
	 

Credit Agreement

 

-77-

	 	 	 	 	 
	 	WESTPAC BANKING CORPORATION

 	 
	 	By:  	/s/ Robert F. Bossé
 	 
	 	 	Name:  	Robert F. Bossé 	 
	 	 	Title:  	Vice President 	 
	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

Credit Agreement

 

-78-

	 	 	 	 	 
	 	THE BANK OF NOVA SCOTIA

 	 
	 	By:  	/s/ Todd S. Meller
 	 
	 	 	Name:  	Todd S. Meller 	 
	 	 	Title:  	Managing Director 	 
	 

Credit Agreement

 

-79-

	 	 	 	 	 
	 	SUMITOMO MITSUI BANKING CORPORATION

 	 
	 	By:  	/s/ Shigeru Tsuru
 	 
	 	 	Name:  	Shigeru Tsuru 	 
	 	 	Title:  	Joint General Manager 	 
	 

Credit Agreement

 

-80-

	 	 	 	 	 
	 	SVENSKA HANDELSBANKEN

 	 
	 	By:  	/s/ H.N. Bacon
 	 
	 	 	Name:  	H.N. Bacon 	 
	 	 	Title:  	Senior Vice President 	 
	 
	 	 	 
	 	By:  	                       /s/ Niclas Fjalltoft
 	 
	 	 	Name:  	Niclas Fjalltoft 	 
	 	 	Title:  	Vice President 	 
	 

Credit Agreement

 

-81-

	 	 	 	 	 
	 	BMO CAPITAL MARKETS FINANCING, INC.

 	 
	 	By:  	/s/ Stephen Maenhout
 	 
	 	 	Name:  	Stephen Maenhout 	 
	 	 	Title:  	Vice President 	 
	 

Credit Agreement

 

-82-

	 	 	 	 	 
	 	THE BANK OF NEW YORK

 	 
	 	By:  	/s/ Richard G Shaw
 	 
	 	 	Name:  	Richard G. Shaw 	 
	 	 	Title:  	Vice President 	 
	 

Credit Agreement

 

-83-

	 	 	 	 	 
	 	MIZUHO CORPORATE BANK, LTD.

 	 
	 	By:  	/s/ Robert Gallagher
 	 
	 	 	Name:  	Robert Gallagher 	 
	 	 	Title:  	Senior Vice President 	 
	 

Credit Agreement

 

-84-

	 	 	 	 	 
	 	STANDARD CHARTERED BANK

 	 
	 	By:  	/s/ Joel Martinez
 	 
	 	 	Name:  	Joel Martinez 	 
	 	 	Title:  	Syndications, Capital Markets 	 
	 
	 	 	 
	 	By:  	                /s/ Robert K. Reddington
 	 
	 	 	Name:  	Robert K. Reddington 	 
	 	 	Title:  	AVP/Credit Documentation
Credit Risk Control

Standard Chartered Bank N.Y. 	 
	 

Credit Agreement

 

-85-

	 	 	 	 	 
	 	SANPAOLO IMI S.p.A.

 	 
	 	By:  	/s/ Renato Carducci
 	 
	 	 	Name:  	Renato Carducci 	 
	 	 	Title:  	General Manager 	 
	 
	 	 	 
	 	By:  	                        /s/ Robert Wurster
 	 
	 	 	Name:  	Robert Wurster 	 
	 	 	Title:  	SVP 	 
	 

Credit Agreement

 

Schedule I

Schedule of Banks

	 	 	 	 	 
	BANK 	 	COMMITMENT	 
	 
	 	 	 	 
	Citigroup USA, Inc.
	 	$	130,000,000	 
	Bank of America, N.A.
	 	$	113,000,000	 
	The Governor and Company of The Bank of Scotland
	 	$	113,000,000	 
	Credit Suisse, Cayman Islands Branch
	 	$	113,000,000	 
	HSBC Bank USA, National Association
	 	$	113,000,000	 
	JPMorgan Chase Bank, N.A.
	 	$	113,000,000	 
	ABN AMRO Bank N.V.
	 	$	95,000,000	 
	Australia and New Zealand Banking Group Limited
	 	$	95,000,000	 
	BNP Paribas
	 	$	95,000,000	 
	Banco Santander Central Hispano, S.A., New York Branch
	 	$	95,000,000	 
	The Bank of Tokyo-Mitsubishi UFJ, Ltd., New York
Branch
	 	$	95,000,000	 
	Barclays Bank PLC
	 	$	95,000,000	 
	Deutsche Bank AG, New York Branch
	 	$	95,000,000	 
	Lehman Brothers Commercial Bank
	 	$	95,000,000	 
	Merrill Lynch Bank USA
	 	$	95,000,000	 
	Morgan Stanley
	 	$	95,000,000	 
	Royal Bank of Canada
	 	$	95,000,000	 
	Societe Generale
	 	$	95,000,000	 
	Toronto Dominion (Texas) LLC
	 	$	95,000,000	 
	UBS Loan Finance LLC
	 	$	95,000,000	 
	Wachovia Bank
	 	$	95,000,000	 
	Westpac Banking Corporation
	 	$	95,000,000	 
	The Bank of Nova Scotia
	 	$	72,500,000	 
	Sumitomo Mitsui Banking Corporation
	 	$	72,500,000	 
	Svenska Handelsbanken
	 	$	35,000,000	 
	BMO Capital Markets Financing, Inc.
	 	$	25,000,000	 
	The Bank of New York
	 	$	25,000,000	 
	Mizuho Corporate Bank, Ltd.
	 	$	25,000,000	 
	Standard Chartered Bank
	 	$	17,500,000	 
	SANPAOLO IMI S.p.A.
	 	$	12,500,000	 
	TOTAL:
	 	$	2,500,000,000	 
	 
	 	 	 

Schedule I

 

Schedule II

Fees and Margins

(in basis points)

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Level I	 	Level II	 	Level III	 	Level IV	 	Level V	 	Level VI
	 	 	Pricing	 	Pricing	 	Pricing	 	Pricing	 	Pricing	 	Pricing
	Facility Fee
	 	 	9.0	 	 	 	110.0	 	 	 	11.0	 	 	 	12.5	 	 	 	15.0	 	 	 	20.0	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Margins:
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	on LIBOR Rate
Loans
	 	 	6.0	 	 	 	15.0	 	 	 	24.0	 	 	 	32.5	 	 	 	45.0	 	 	 	55.0	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	on Base Rate
Loans
	 	 	0.0	 	 	 	0.0	 	 	 	0.0	 	 	 	0.0	 	 	 	0.0	 	 	 	0.0	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Competitive
Bid Option
	 	As bid by the Banks	 	As bid by the Banks	 	As bid by the Banks	 	As bid by the Banks	 	As bid by the Banks	 	As bid by the Banks
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Drawn Cost:
	 	 	15.0	 	 	 	25.0	 	 	 	35.0	 	 	 	45.0	 	 	 	60.0	 	 	 	75.0	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Utilization Fee
(In excess of
33.33%)
	 	 	5.0	 	 	 	5.0	 	 	 	5.0	 	 	 	5.0	 	 	 	5.0	 	 	 	10.0	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Fully Drawn Cost
	 	 	20.0	 	 	 	30.0	 	 	 	40.0	 	 	 	50.0	 	 	 	65.0	 	 	 	85.0	 

     For purposes of this Schedule, the following terms have the following meanings:

     “Level I Pricing” means the pricing during any period during which the
Company’s long-term senior unsecured debt is rated AA or higher by S&P or Aa2 or higher by
Moody’s.

     “Level II Pricing” means the pricing during any period during which (i) the
Company’s long-term senior unsecured debt is rated AA- or higher by S&P or Aa3 or higher by
Moody’s and (ii) Level I Pricing does not apply.

     “Level III Pricing” means the pricing during any period during which (i) the
Company’s long-term senior unsecured debt is rated A+ or higher by S&P or A1 or higher by
Moody’s and (ii) neither Level I Pricing nor Level II Pricing applies.

Schedule II

 

 

  -2-  

     “Level IV Pricing” means the pricing during any period during which (i) the
Company’s long-term senior unsecured debt is rated A or higher by S&P or A2 or higher by
Moody’s and (ii) none of Level I Pricing, Level II Pricing and Level III Pricing applies.

     “Level V Pricing” means the pricing during any period during which (i) the
Company’s long-term senior unsecured debt is rated A- or higher by S&P or A3 or higher by
Moody’s and (ii) none of Level I Pricing, Level II Pricing, Level III Pricing and Level IV
Pricing applies.

     “Level VI Pricing” means the pricing during any period during which no other
Pricing Level applies.

     “Moody’s” means Moody’s Investors Service, Inc. or any successor corporation
thereto.

     “Pricing Level” means Level I Pricing, Level II Pricing, Level III Pricing,
Level IV Pricing, Level V Pricing and Level VI Pricing.

     “S&P” means Standard & Poor’s Ratings, a division of McGraw Hill, Inc., or any
successor corporation thereto.

          Any change in fees or margins by reason of a change in S&P’s rating or Moody’s rating shall
become effective on the date of announcement or publication by the respective rating agencies of a
change in such rating or, in the absence of such announcement or publication, on the effective date
of such changed rating.

          If S&P’s rating and Moody’s rating differ by more than one rating level, then the applicable
Pricing Level shall be one rating level higher than the Pricing Level resulting from the
application of the lower of such ratings.

Schedule II

 

 

Schedule III

Address for Notices

	 	 	 
	PARTY	 	ADDRESS FOR NOTICES
	Company

	 	Pamela S. Hendry
	 

	 	10250 Constellation Blvd., Suite 3400
	 

	 	Los Angeles, California 90067
	 

	 	Tel: (310) 788-1999
	 

	 	Fax: (310) 788-1990
	 

	 	Telex: 69-1400 INTERLEAS BVHL
	 

	 	Email: legalnotices@ilfc.com
	 
	 	 
	Agent

	 	2 Penns Way, Suite 200
	 

	 	New Castle, DE 19720
	 

	 	Tel: (302) 894-6005
	 

	 	Fax: (302) 894-6120
	 
	 	 
	Citicorp USA, Inc., as Bank

	 	2 Penns Way, Suite 200
	 

	 	New Castle, DE 19720
	 

	 	Tel: (302) 894-6005
	 

	 	Fax: (302) 894-6120
	 
	 	 
	Bank of America, N.A.

	 	Mark G. Short
	 

	 	901 Main St
	 

	 	64th Floor
	 

	 	Dallas, TX 75202
	 

	 	Tel: (214) 209-0670
	 

	 	Fax: (214) 209-1027
	 

	 	Mark.g.short@bankofamerica.com
	 
	 	 
	The Governor and Company of the Bank
of Scotland

	 	Carl Irvine

155 Bishopsgate

Level 7

London EC2M 3YB

Tel: 020 7012 9289

Fax: 020 7012 9455
	 
	 	 
	Credit Suisse, Cayman Islands Branch

	 	Ed Markowski
	 

	 	One Madison Ave.
	 

	 	New York, NY 10010
	 

	 	Tel: (212) 538-3380
	 

	 	Fax: (212) 538-6851
	 

	 	e-mail: Edward.markowski@csfb.com
	 
	 	 
	HSBC Bank USA, National Association

	 	452 Fifth Avenue, 5th Floor
	 

	 	New York, NY 10018
	 

	 	Attention: Kenneth J. Johnson
	 

	 	Tel: (212) 525-2480
	 

	 	Fax: (212) 525-6856
	 

	 	e-mail: kenneth.j.johnson@us.hsbc.com

Schedule III

 

 

  -2-  

	 	 	 
	JPMorgan Chase Bank, N.A.

	 	Denise Ramon
	 

	 	1111 Fannin
	 

	 	11th Floor
	 

	 	Houston, TX 77002
	 
	 	 
	ABN AMRO Bank N.V.

	 	Irene Joseph
	 

	 	540 West Madison Street, Suite 2621
	 

	 	Chicago, IL 60661
	 

	 	Fax: (312) 992-5111
	 

	 	e-mail: Irene.joseph@abnamro.com
	 
	 	 
	Australia and New Zealand Banking
Group Limited

	 	Christine Reyling

1177 Avenue of the Americas
	 

	 	6th Floor
	 

	 	New York, NY 10036
	 

	 	e-mail: ReylingC@anz.com
	 
	 	 
	BNP Paribas

	 	Phil Truesdale
	 

	 	787 Seventh Ave., 28th Floor
	 

	 	New York, NY 10019
	 

	 	Tel: (212) 841-2870
	 

	 	Fax: (212) 841-2533
	 

	 	e-mail: Phil.truesdale@americas.bnpparibas.com
	 
	 	 
	Banco Santander Central Hispano, S.A.,
New York Branch

	 	Ligla Castro

45 East 53rd Street
	 

	 	New York, NY
	 

	 	Tel: (212) 350-3677
	 

	 	Fax: (212) 350-3647
	 

	 	e-mail: lcastro@schny.com
	 
	 	 
	The Bank of Tokyo-Mitsubishi UFJ, Ltd.,
New York Branch

	 	Jim Brown

1251 Avenue of the Americas, 12th Floor
	 

	 	New York, NY 10020-1104
	 

	 	Tel: (212) 782-4221
	 

	 	Fax: (212) 782-6445
	 

	 	e-mail: jbrown@btmna.com
	 
	 	 
	Barclays Bank PLC

	 	Alison McGuigan
	 

	 	200 Park Avenue
	 

	 	New York, NY 10166
	 

	 	Tel: (212) 412-7672
	 

	 	Fax: (212) 412-5610
	 

	 	e-mail: Alison.mcguigan@barcap.com
	 
	 	 
	Deutsche Bank AG, New York Branch

	 	Ruth Leung
	 

	 	Portfolio Manager — North American Insurance
	 

	 	Companies Deutsche Bank Securities
	 

	 	60 Wall Street
	 

	 	New York, NY 10005
	 

	 	Tel: (212) 250-8650
	 

	 	Fax: (212) 797-0270

Schedule III

 

 

  -3-  

	 	 	 
	Lehman Brothers Commercial Bank

	 	Janine Shugan
	 

	 	745 7th Avenue, 5th Floor
	 

	 	New York, NY 10019
	 

	 	Tel: (212) 526-8625
	 

	 	Fax: (917) 522-0139
	 

	 	e-mail: jshugan@lehman.com
	 
	 	 
	Merrill Lynch Bank USA

	 	Frank Stepan
	 

	 	15 West South Temple, Suite 300
	 

	 	Salt Lake City, UT 84101
	 

	 	Tel: (801) 526-8316
	 

	 	Fax: (801)531-7470
	 

	 	e-mail: frank_stepan@ml.com
	 
	 	 
	Morgan Stanley

	 	Erma Dell’Aquila/Edward Henley
	 

	 	One Pierrepont Plaza
	 

	 	7th Floor
	 

	 	300 Cadman Plaza West
	 

	 	Brooklyn, NY 11201
	 

	 	Erma.Dell’Aquila@morganstanley.com
	 

	 	Edward.Henley@morganstanley.com
	 
	 	 
	Royal Bank of Canada

	 	Linda Joannou
	 

	 	One Liberty Plaza, 4th Floor
	 

	 	New York, NY 10006-1404
	 

	 	Tel: (212) 428-6212
	 

	 	Fax: (212) 428-2372
	 
	 	 
	Societe Generale

	 	Carol Radice
	 

	 	1221 Avenue of the Americas
	 

	 	New York, NY 10020
	 

	 	Tel: (212) 278-6183
	 

	 	Fax: (212) 278-7862
	 

	 	e-mail: carold.radice@sgcib.com
	 
	 	 
	Toronto Dominion (Texas) LLC

	 	Cori Worchel
	 

	 	31 West 52nd Street
	 

	 	22nd Floor
	 

	 	New York, NY 10019
	 

	 	e-mail: cori-worchel@tdsecurities.com
	 
	 	 
	UBS Loan Finance LLC

	 	Joe Pigott
	 

	 	677 Washington Blvd.
	 

	 	Stanford, CT 06901
	 

	 	Tel: (203) 719-4853
	 

	 	Fax: (203) 719-4400
	 

	 	e-mail: joseph.pigott@ubs.com

Schedule III

 

 

  -4-  

	 	 	 
	Wachovia Bank

	 	Grainne Pergolini
	 

	 	1339 Chestnut Street
	 

	 	Philadelphia, PA 19107
	 

	 	Tel: (267) 321-6205
	 

	 	Fax: (267) 321-7101
	 

	 	e-mail: grainne.pergolini@wachovia.com
	 
	 	 
	Westpac Banking Corporation

	 	Robert Bosse
	 

	 	575 Fifth Avenue
	 

	 	39th Floor
	 

	 	New York, NY 10017
	 

	 	e-mail: rbosse@westpac.com.au
	 
	 	 
	The Bank of Nova Scotia
	 	 
	 
	 	 
	Sumitomo Mitsui Banking Corporation

	 	Bill Haney, Legal Department
	 

	 	277 Park Avenue
	 

	 	New York, NY 10172
	 
	 	 
	Svenska Handelsbanken

	 	H. Newell Bacon
	 

	 	875 Third Avenue — 4th floor
	 

	 	New York, N. Y. 10022-7218
	 

	 	Tel: (212) 326-2726
	 

	 	Fax: (212) 326-5151
	 
	 	 
	BMO Capital Markets Financing, Inc.
	 	 
	 
	 	 
	The Bank of New York

	 	Geoffrey Brooks
	 

	 	One Wall Street
	 

	 	New York, NY 10286
	 

	 	Tel: (212) 635-8475
	 

	 	Fax: (212) 809-9520
	 

	 	e-mail: gbrooks@bankofny.com
	 
	 	 
	Mizuho Corporate Bank, Ltd.

	 	David Lim
	 

	 	1251 Avenue of the Americas
	 

	 	New York, NY 10020
	 

	 	Tel: (212) 282-3359
	 

	 	Fax: (212) 282-4488
	 

	 	e-mail: david.lim@mizuhous.com
	 
	 	 
	Standard Chartered Bank

	 	Robert Gilbert
	 

	 	One Madison Avenue
	 

	 	New York, NY 10070
	 

	 	Tel: (212) 667-04963
	 

	 	Fax: (212) 667-0273
	 

	 	e-mail: Robert.gilbert@us.standardchartered.com
	 
	 	 
	SANPAOLO IMI S.p.A.

	 	SANPAOLO IMI LA Office
	 

	 	Attention: Donald Brown
	 

	 	444 S. Flower Street, Suite 4550
	 

	 	Los Angeles, CA 90071
	 

	 	Tel: (203) 489-3105

Schedule III

 

 

  -5-  

	 	 	 
	 

	 	Fax: (203) 622-2514
	 

	 	e-mail: spimila@sbcglobal.net
	 
	 	 
	 

	 	SANPAOLO IMI NY Branch
	 

	 	Attention: Robert Wurster
	 

	 	245 Park Avenue, 35th Floor
	 

	 	New York, NY 10167
	 

	 	Tel: (212) 692-3160
	 

	 	Fax: (212) 692-3178
	 

	 	e-mail: Robert.wurster@sanpaoloimi.com

Schedule III

 

 

Exhibit A

FORM OF

NOTICE OF COMPETITIVE BID BORROWING

                                        , ____

Citicorp USA, Inc., as Agent

2 Penns Way, Suite 200

New Castle, DE 19720

Ladies and Gentlemen:

          This instrument constitutes a Notice of Competitive Bid Borrowing under, and as defined by,
the $2,500,000,000 Five-Year Revolving Credit Agreement, dated as of October 13, 2006 (as amended,
modified or supplemented, the “Credit Agreement”), among International Lease Finance
Corporation (the “Company”), Citicorp USA, Inc., in its individual corporate capacity and
as Agent, and certain financial institutions referred to therein. Terms not otherwise expressly
defined herein shall have the meanings set forth in the Credit Agreement.

          The Company hereby requests (a) Bid Loan(s), subject to the terms of the Credit Agreement, as
follows:

          (a) Funding Date:                                         , ___.

          (b) Aggregate principal amount of Bid Loans requested: $                    .

          (c) Loan Period(s):*

Absolute Rate Loans:                      days                     days                     days

LIBOR Rate Loans:                      months                      months                      months

          (d) Account to be credited:                                         

          The officer of the Company signing this Notice of Competitive Bid Borrowing hereby certifies
that the following statements are true on the date hereof:

	 	(a)	 	Before and after giving effect to the Bid Loans requested
hereby, no Event of Default or Unmatured Event of Default shall have occurred
and be continuing or shall result from the making of such Loan; and
	 
	 	(b)	 	Before and after giving effect to the Bid Loans requested
hereby, the representations and warranties set forth in Section 8 of the Credit
Agreement

Form of Notice of Competitive Bid Borrowing

 

			
	*	 	The Company may select up to three loan periods per
Notice of Competitive Bid Borrowing.

 

 

-2-

shall be true and correct in all material respects as of the date of such
requested Loans with the same effect as though made on the date of such Bid
Loans.

	 	 	 	 	 	 	 
	 	 	Very truly yours,	 	 
	 
	 	 	 	 	 	 
	 	 	INTERNATIONAL LEASE FINANCE

     CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Its:	 	 	 	 
	 

	 	 	 	 	 	 

Form of Notice of Competitive Bid Borrowing

 

 

Exhibit B

FORM OF

BID FROM [Name of Bank]

(Contact Person:                    )

                                        ,____

Citicorp USA, Inc., as Agent

2 Penns Way, Suite 200

New Castle, DE 19720

Ladies and Gentlemen:

          This instrument constitutes a Bid under, and as defined by, the $2,500,000,000 Five-Year
Revolving Credit Agreement, dated as of October 13, 2006 (as amended, modified or supplemented, the
“Credit Agreement”), among International Lease Finance Corporation (the “Company”),
Citicorp USA, Inc., in its individual corporate capacity and as Agent, and certain financial
institutions referred to therein, including the undersigned. Terms not otherwise expressly defined
herein shall have the meanings set forth in the Credit Agreement.

     (1) The Company’s related Notice of Competitive Bid Borrowing, dated                     ,
___, inviting this Bid has requested a Bid Loan, subject to the terms and conditions of the
Credit Agreement, in the aggregate principal amount of $                    with a Funding Date of
                    , ___.

     (2) The undersigned hereby offers to make the following Bid Loan(s)
on the Funding Date: *

 

			
	*	 	$10,000,000 or a higher integral multiple of
$1,000,000.

Form of Bid

 

-2-

	 	 	 	 	 	 	 
	 

	 	(a) Loan Period of
	 	                     days
	 	                     months

	 	 	 	 	 	 	 
	 	 	Principal Amount	 	Interest Rate or
	 	 	Minimum	 	Maximum	 	LIBOR ± Margin
	1.
	 	$*	 	$*	 	**
	2.
	 	$*	 	$*	 	**
	3.
	 	$*	 	$*	 	**
	4.
	 	$*	 	$*	 	**

          (3) The undersigned’s lending office for the proposed Bid Loan is                     .

          (4) The undersigned acknowledges that the offer(s) set forth above, subject to the
satisfaction of the applicable conditions precedent set forth in the Credit Agreement, irrevocably
obligate(s) the undersigned to make the Bid Loan(s) for which any offer(s) are accepted, in whole
or in part, in accordance with the terms of the Credit Agreement.

	 	 	 	 	 	 	 
	 	 	Very truly yours,	 	 
	 
	 	 	 	 	 	 
	 	 	[NAME OF BANK]	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Its:	 	 	 	 
	 

	 	 	 	 	 	 

 

			
	*	 	$10,000,000 of higher integral multiple of $1,000,000
for each interest rate (i.e., Portion) for each Loan Period.
	 
	**	 	Specify the interest rate per annum (expressed as a
percentage to four decimal places) in the case of an Absolute Rate Loan and the
margin above or below LIBOR in the case of a LIBOR Rate Loan.

Form of Bid

 

 

Exhibit C

FORM OF

COMMITTED LOAN REQUEST

                    , ____

Citicorp USA, Inc., as Agent

2 Penns Way, Suite 200

New Castle, DE 19720

Ladies and Gentlemen:

          This constitutes a Committed Loan Request under, and as defined by, the $2,500,000,000
Five-Year Revolving Credit Agreement, dated as of October 13, 2006 (as amended, modified or
supplemented, the “Credit Agreement”), among International Lease Finance Corporation (the
“Company”), Citicorp USA, Inc., in its individual corporate capacity and as Agent, and
certain financial institutions referred to therein. Terms not otherwise expressly defined herein
shall have the meanings set forth in the Credit Agreement.

          The Company hereby requests that the Banks make Committed Loans to it, subject to the terms
and conditions of the Credit Agreement, as follows:

          (a) Funding Date:                                         , ___.

          (b) Aggregate principal amount of Committed Loans requested: $                    .

          (c) Loan Period:                                         .

          (d) Type of Loans: [LIBOR Rate Loans] [Base Rate Loans].

          The officer of the Company signing this Committed Loan Request hereby certifies that as of the
date hereof:

          (a) Before and after giving effect to the Committed Loans requested
hereby, no Event of Default or Unmatured Event of Default shall have occurred
and be continuing or shall result from the making of such Loans;

          (b) Before and after giving effect to the Loans requested hereby,
the representations and warranties set forth in Section 8 of the Credit
Agreement shall be true and correct in all material respects with the same
effect as though made on the date of such Loans; and

Form of Committed Loan Request

 

-2-

          (c) After the making of the Loans requested hereby, the aggregate
principal amount of all outstanding Loans will not exceed the Aggregate Commitment.

	 	 	 	 	 	 	 
	 	 	Very truly yours,	 	 
	 
	 	 	 	 	 	 
	 	 	INTERNATIONAL LEASE FINANCE CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

	 	 
	 
	 	 	 	 	 	 
	 

	 	Its:	 	 	 	 
	 

	 	 	 	 	 	 

Form of Committed Loan Request

 

 

Exhibit D

FORM OF BID NOTE

			
	 

$2,500,000,000
	 	[                     ___, ___]

          International Lease Finance Corporation, a California corporation (the “Company”), for
value received, hereby promises to pay to the order of [NAME OF BANK] (the “Bank”), at the
office of Citicorp USA, Inc., in its individual corporate capacity and as Agent (the
“Agent”), at 2 Penns Way, Suite 200, New Castle, DE 19720 on ___, 200[_], or at such
other place, to such other person or at such other time and date as provided for in the
$2,500,000,000 Five-Year Revolving Credit Agreement (as amended, modified or supplemented, the
“Credit Agreement”), dated as of October 13, 2006 among the Company, the Agent, and the
financial institutions named therein, in lawful money of the United States of America, the
principal sum of $2,500,000,000 or, if less, the aggregate unpaid principal amount of all Bid Loans
made by the Bank to the Company pursuant to the Credit Agreement. This Bid Note shall bear
interest as set forth in the Credit Agreement for Bid Borrowings (as defined in the Credit
Agreement).

          Except as otherwise provided in the Credit Agreement with respect to LIBOR Rate Loans, if
interest or principal on any loan evidenced by this Note becomes due and payable on a day which is
not a Business Day (as defined in the Credit Agreement) the maturity thereof shall be extended to
the next succeeding Business Day, and interest shall be payable thereon at the rate herein
specified during such extension.

          This Note is one of the Bid Notes referred to in the Credit Agreement. This Note is subject
to prepayment in whole or in part, and the maturity of this Note is subject to acceleration, upon
the terms provided in the Credit Agreement.

          This Note shall be governed by, and construed and interpreted in accordance with, the law of
the State of New York.

[remainder of page intentionally left blank]

Form of Bid Note

 

-2-

          All Bid Loans made by the Bank to the Company pursuant to the Credit Agreement and all
payments of principal thereof may be indicated by the Bank upon the grid attached hereto which is a
part of this Note. Such notations shall be rebuttable presumptive evidence of the aggregate unpaid
principal amount of all Bid Loans made by the Bank pursuant to the Credit Agreement.

	 	 	 	 	 
	 	INTERNATIONAL LEASE FINANCE CORPORATION 

 	 
	 	By:  	

 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	 	 
	 	By:	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

Form of Bid Note

 

-3-

Bid Loans and Payments of Principal

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Amount	 	 	 	 	 	 	Name of	 
	 	 	Principal	 	 	 	 	 	 	 	 	 	 	 	 	 	 	of	 	 	Unpaid	 	 	Person	 
	Funding	 	Amount	 	 	Interest	 	 	Interest	 	 	Loan	 	 	Principal	 	 	Principal	 	 	Making	 
	Date	 	of Loan	 	 	Method	 	 	Rate	 	 	Period	 	 	Paid	 	 	Balance	 	 	Notation	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

Form of Bid Note

 

 

Exhibit E

FORM OF COMMITTED NOTE

			
	 	 	 
	$                    
	 	[                     ___, ___]

          International Lease Finance Corporation, a California corporation (the “Company”), for value
received, hereby promises to pay to the order of [NAME OF BANK] (the “Bank”), at the office of
Citicorp USA, Inc., in its individual corporate capacity and as Agent (the “Agent”), at 2 Penns
Way, Suite 200, New Castle, DE 19720 on [___, ___], or at such other place, to such other
person or at such other time and date as provided for in the $2,500,000,000 Five-Year Revolving
Credit Agreement (as amended, modified or supplemented, the “Credit Agreement”), dated as of
October 13, 2006, among the Company, the Agent, and the financial institutions named therein, in
lawful money of the United States of America, the principal sum of $___or, if less, the
aggregate unpaid principal amount of all Committed Loans made by the Bank to the Company pursuant
to the Credit Agreement. This Committed Note shall bear interest as set forth in the Credit
Agreement for Base Rate Loans and LIBOR Rate Loans (as defined in the Credit Agreement), as the
case may be.

          Except as otherwise provided in the Credit Agreement with respect to LIBOR Rate Loans, if
interest or principal on any loan evidenced by this Note becomes due and payable on a day which is
not a Business Day (as defined in the Credit Agreement) the maturity thereof shall be extended to
the next succeeding Business Day, and interest shall be payable thereon at the rate herein
specified during such extension.

          This Note is one of the Committed Notes referred to in the Credit Agreement. This Note is
subject to prepayment in whole or in part, and the maturity of this Note is subject to
acceleration, upon the terms provided in the Credit Agreement.

          This Note shall be governed by, and construed and interpreted in accordance with, the law of
the State of New York.

[remainder of page intentionally left blank]

FORM OF COMMITTED NOTE

 

-2-

          All Committed Loans made by the Bank to the Company pursuant to the Credit Agreement and all
payments of principal thereof may be indicated by the Bank upon the grid attached hereto which is a
part of this Note. Such notations shall be rebuttable presumptive evidence of the aggregate unpaid
principal amount of all Committed Loans made by the Bank pursuant to the Credit Agreement.

	 	 	 	 	 
	 	INTERNATIONAL LEASE FINANCE CORPORATION 

 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

FORM OF COMMITTED NOTE

 

-3-

Committed Loans and Payments of Principal

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Amount	 	 	 	 	 	 	Name of	 
	 	 	Principal	 	 	 	 	 	 	 	 	 	 	 	 	 	 	of	 	 	Unpaid	 	 	Person	 
	Funding	 	Amount	 	 	Interest	 	 	Interest	 	 	Loan	 	 	Principal	 	 	Principal	 	 	Making	 
	Date	 	of Loan	 	 	Method	 	 	Rate	 	 	Period	 	 	Paid	 	 	Balance	 	 	Notation	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

FORM OF COMMITTED NOTE

 

 

Exhibit F

FIXED CHARGE COVERAGE RATIO*

FOR THE PERIOD ENDED December 31, 2005

	 	 	 	 	 
	 	 	12 Months Ended
	 	 	December 31, 2005
	 	 	(Dollars in thousands)
	Earnings
	 	 	 	 
	Net Income
	 	 	438,349	 
	Add (to the extent deducted):
	 	 	 	 
	Provision for income taxes
	 	 	235,834	 
	Fixed charges
	 	 	1,172,434	 
	Less (to the extent added):
	 	 	 	 
	Capitalized interest
	 	 	54,097	 
	 
	 	 	 	 
	Earnings as adjusted (A)
	 	 	1,792,520	 
	 
	 	 	 	 
	Preferred dividend requirements
	 	 	4,650	 
	Ratio of income before provision for
income taxes to net income
	 	 	154	%
	 
	 	 	 	 
	Preferred dividend factor on
pretax basis
	 	 	7,161	 
	 
	 	 	 	 
	Fixed charges
Interest expense
	 	 	1,118,337	 
	Capitalized interest
	 	 	54,097	 
	Interest factor of rents
	 	 	—	 
	 
	 	 	 	 
	Fixed charges as adjusted
	 	 	1,172,434	 
	 
	 	 	 	 
	Fixed charges and preferred
Stock dividends (B)
	 	 	1,179,595	 
	 
	 	 	 	 
	Ratio of earnings to fixed charges and
preferred stock dividends ((A) divided
by (B))*
	 	 	1.52	 

 

			
	*	 	As calculated pursuant to Section 9.11 and the definition of Fixed Charge Coverage Ratio set
forth in Section 1.2.

Fixed Charge Coverage Ratio

 

 

Exhibit G

FORM OF OPINION OF COUNSEL FOR THE COMPANY

[                     __, ____]

To the Financial Institutions and

     the Agent Referred to Below

c/o Citicorp USA, Inc.

2 Penns Way, Suite 200

New Castle, Delaware 19720

Ladies and Gentlemen:

          We have acted as special counsel for International Lease Finance Corporation (the
“Company”) in connection with the $2,500,000,000 Five-Year Revolving Credit Agreement dated
as of October 13, 2006 (the “Credit Agreement”), by and among the Company, those certain
financial institutions signatory thereto (the “Banks”), and Citicorp USA, Inc., in its
individual capacity and as agent for the Banks (the “Agent”). Terms used herein without
definition have the meanings given to such terms in the Credit Agreement.

          In our capacity as such counsel, we have examined originals, or copies certified or otherwise
identified to our satisfaction as being true copies of such records, documents or other instruments
as in our judgment are necessary or appropriate to enable us to render the opinions expressed
below. We have been furnished, and have relied upon, certificates of officers of the Company with
respect to certain factual matters regarding the Company. As to relevant factual matters, we have
also relied on the representations and warranties made by the Company in the Credit Agreement. In
addition, we have obtained and relied upon such certificates and assurances from public officials
as we have deemed necessary.

          In our review and examination we have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us as originals and the conformity to authentic original
documents of all documents submitted to us as conformed or photostatic copies. For the purpose of
the opinions hereinafter expressed, we have assumed the due execution and delivery, pursuant to due
authorization, of each document referred to in this opinion by each party thereto other than the
Company and its Subsidiaries, that each document constitutes the legally valid and binding
obligation of each such other party enforceable against such party in accordance with its
respective terms and that such other person is duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization.

     We have investigated such questions of law for the purpose of rendering this opinion as we
have deemed necessary. Upon the basis of the foregoing, our reliance upon the assumptions in this
opinion and our considerations of those questions of law we considered relevant and subject to the
limitations and qualifications in this opinion, we are of the opinion that:

Form of Opinion of Counsel for the Company

 

 

-2-

          1. The Company has been duly incorporated and is validly existing in good standing under the
laws of the State of California, with corporate power to own its properties and carry on its
business as described in the Company’s Annual Report on Form 10-K, as amended, for its fiscal year
ended December 31, 2005.

          2. The Company has the corporate power and corporate authority to enter into the Credit
Agreement, to make the borrowings under the Credit Agreement, to execute and deliver the Notes and
to incur the obligations provided for therein, all of which have been duly authorized by all
necessary corporate action on the part of the Company.

          3. No order, consent, permit or approval of any California or U.S. federal governmental
authority that we have, in exercise of customary professional diligence, recognized as applicable
to the Company or to the transactions of the type contemplated by the Credit Agreement, is required
on the part of the Company for the execution and delivery of, and the performance of its
obligations under, the Credit Agreement and the Notes except as have been obtained or as may be
obtained in the ordinary course of business.

          4. The Credit Agreement and the Notes have been duly executed and delivered by the Company.

          5. Each of the Credit Agreement and the Notes (if any) constitutes the legally valid and
binding obligations of the Company enforceable against the Company in accordance with their
respective terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws relating to or affecting creditors’ rights generally (including, without limitation,
fraudulent conveyance laws) and by general principles of equity, including, without limitation,
concepts of materiality, reasonableness, good faith and fair dealing and the possible
unavailability of specific performance or injunctive relief, regardless of whether considered in a
proceeding in equity or at law.

          6. The execution and delivery of the Credit Agreement and the Notes by the Company do not, and
the Company’s performance of its obligations under the Credit Agreement and the Notes will not (i)
violate the Company’s Articles of Incorporation or Bylaws, or (ii) violate, breach or result in a
default under any existing obligation of or restriction on the Company under any of the agreements,
instruments, contracts, orders, injunctions or judgments (the “Other Agreements”) identified to us
in an officer’s certificate of the Company (a copy of which is being delivered to you concurrently
herewith) as agreements, instruments, contracts, orders, injunctions or judgments binding on the
Company or by which its assets are bound which have provisions limiting or impacted by the issuance
by the Company of debt and which the violation or breach of or default under would have a Material
Adverse Effect. We express no opinion as to the effect of the Company’s performance of its
obligations in the Credit Agreement (and the Notes) with respect to the Company’s compliance with
financial covenants in the Other Agreements.

          7. The execution and delivery by the Company of the Credit Agreement and the Notes do not, and
the Company’s performance of its obligations under the Credit Agreement and the Notes will not, violate any current California, New York or U.S. federal statute, rule
or

Form of Opinion of Counsel for the Company

 

-3-

regulation that we have in the exercise of customary professional due diligence recognized as
applicable to the Company or to the transactions of the type contemplated by the Credit Agreement.

          8. The making of the Loan and the use of the proceeds thereof as provided in the Credit
Agreement will not violate Regulation T, U or X of the Board of Governors of the Federal Reserve
System. For purposes of this opinion, we have assumed that none of the Banks is a “creditor” as
defined in Regulation T.

          9. The Company is not an “investment company” required to register under the Investment
Company Act of 1940, as amended.

          Our opinion in paragraph 5 above as to the enforceability of the Credit Agreement and the
Notes is subject to:

(i) the unenforceability under certain circumstances of broadly or vaguely stated
waivers or waivers of rights granted by law where the waivers are against public
policy or prohibited by law; and

(ii) the unenforceability under certain circumstances of provisions appointing one
party as attorney-in-fact or trustee for an adverse party.

          We express no opinion as to any provision of the Credit Agreement insofar as it purports to grant a
right of setoff in respect of any Party’s assets to any person other than a creditor of such Party.

          For purposes of the opinions expressed in paragraphs 3, 6 and 7, we have assumed that the
Company will not in the future take any discretionary action (including a decision not to act)
permitted by the Credit Agreement or the Notes that would cause the performance of the Credit
Agreement or the Company’s obligations under the Notes to violate any California, New York or U.S.
federal statute, rule or regulation, constitute a violation or breach of or default under any of
the agreements, instruments, contracts, orders, injunctions, judgments or decrees referred to in
paragraph 6 or require an order, consent, permit or approval to be obtained from a California, New
York or U.S. federal governmental authority.

          We express no opinion concerning (i) federal or state securities laws or regulations, (ii)
federal or state antitrust, unfair competition or trade practice laws or regulations, (iii) pension
and employee benefit laws and regulations, (iv) compliance with fiduciary requirements, (v) federal
or state environmental laws and regulations, (vi) federal or state land use or subdivision laws or
regulations or (vii) federal or state laws and regulations concerning filing requirements, other
than requirements applicable to charter-related documents.

          In addition, we call your attention to the fact that the California Supreme Court in
Grafton Partners v. Superior Court, 36 Cal. 4th 944 (2005), recently held that, under
California law, pre-dispute waivers of the right to trial by jury are unenforceable. Although the
Credit Agreement and the Notes each state that it is governed by the laws of the State of New York,
a California court may not enforce the choice of New York law with respect to the waiver of the

Form of Opinion of Counsel for the Company

 

-4-

right to trial by jury in the Credit Agreement. Accordingly, we express no opinion as to
whether or not the waiver of such right would be given effect by a California court.

          The law covered by this opinion is limited to the present federal law of the United States and
the present laws of the State of California, and for the purposes of paragraphs 5 and 7, the
present laws of the State of New York. Our opinions rendered in paragraphs 3 and 7 above are based
upon our review only of those statutes, rules and regulations which, in our experience, are
normally applicable to transactions of the type contemplated by the Credit Agreement and the Notes.
We express no opinion as to the laws of any other jurisdiction and no opinion regarding the
statutes, administrative decisions, rules, regulations or requirements of any county, municipality,
subdivision or local authority of any jurisdiction.

          In rendering our opinions in paragraph 3 above, we have assumed that each Bank is a
sophisticated financial institution capable of evaluating the merits and risks relating to the
Credit Agreement and the Notes, and that each Bank has been provided access to such information
relating to the Company as such Bank has requested.

          Except as expressly set forth in paragraph 8 above, we are not expressing any opinion as to
the effect of the Agent’s or any Bank’s compliance with any state or federal laws or regulations
applicable to the transactions contemplated by the Company because of the nature of the Agent’s or
any Bank’s business.

          This opinion is furnished to you in connection with the Company’s execution and delivery of
the Credit Agreement, is solely for your benefit and the benefit of your successors and assigns,
and may not be relied upon by, nor may copies be delivered to, any other person, without our prior
written consent. This opinion is expressly limited to the matters set forth above and we render no
opinion, whether by implication or otherwise, as to any other matters. We assume no obligation to
update or supplement this opinion to reflect any facts or circumstances that arise after the date
of this opinion and come to our attention, or any future changes in laws.

Respectfully submitted,

Form of Opinion of Counsel for the Company

 

 

Exhibit H

FORM OF THE OPINION OF GENERAL COUNSEL OF THE COMPANY

[                     __, ____]

To the Banks and the Agent

  Referred to Below

c/o Citicorp USA, Inc.

2 Penns Way, Suite 200

New Castle, Delaware 19720

Ladies and Gentlemen:

          I am General Counsel for International Lease Finance Corporation (the “Company”) and
am rendering this opinion in connection with the $2,500,000,000 Five-Year Revolving Credit
Agreement dated as of October 13, 2006 (the “Credit Agreement”), by and among the Company,
those certain financial institutions signatory thereto (the “Banks”) and Citicorp USA,
Inc., in its individual capacity and as administrative agent (the “Agent”). Terms used
herein without definition have the meanings given to such terms in the Credit Agreement.

          I have examined originals, or copies certified or otherwise identified to my satisfaction as
being true copies, of such documents, corporate records, certificates of public officials and other
instruments and have conducted such other investigations of fact and law as I have deemed necessary
or advisable for purposes of this opinion. I am opining herein as to the effect on the subject
transactions of only United States of America federal law and the laws of the State of California.

          Upon the basis of the foregoing, I am of the opinion that:

          1. The Company is duly qualified to do business as a foreign corporation and is in good
standing under the laws of each jurisdiction in which the ownership or leasing of its property or
the conduct of its business requires it to be so qualified; provided, however, that
the Company may not be so qualified in certain jurisdictions, the effect of which would not have a
Material Adverse Effect on the Company.

          2. No subsidiary of the Company nor all of the subsidiaries of the Company taken as a whole is
a “significant subsidiary” as defined in Rule 1-02 of Regulation S-X promulgated under the
Securities Exchange Act of 1934, as amended.

          3. To the best of my knowledge, there is no pending or threatened action, suit or proceeding
before any court or governmental agency, authority or body or any arbitrator involving the Company
or any of its Subsidiaries which, individually or in the aggregate, would have a Material Adverse
Effect on the Company and its Subsidiaries taken as a whole.

Form of the Opinion of General Counsel of the Company

 

 

-2-

          This opinion is furnished to you in connection with the Company’s execution and delivery of
the Credit Agreement, is solely for your benefit and the benefit of your successors and assigns,
and may not be relied upon by, nor may copies be delivered to, any other person without my prior
written consent. This opinion is expressly limited to the matters set forth above and I render no
opinion, whether by implication or otherwise, as to any other matters. I assume no obligation to
update or supplement this opinion to reflect any facts or circumstances that arise after the date
of this opinion and come to my attention, or any future changes in laws.

Very truly yours,

Julie I. Sackman

General Counsel

Form of the Opinion of General Counsel of the Company

 

 

Exhibit I

FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT

          AGREEMENT dated as of                                         , ___between [ASSIGNOR] (the “Assignor”) and [ASSIGNEE]
(the “Assignee”).

W I T N E S S E T H

          WHEREAS, this Assignment and Assumption Agreement (the “Agreement”) relates to the
$2,500,000,000 Five-Year Revolving Credit Agreement dated as of October 13, 2006 (the “Credit
Agreement”) among International Lease Finance Corporation (the “Company”), the Assignor
and Citicorp USA, Inc., in its individual corporate capacity and as Agent (the “Agent”),
and certain financial institutions referred to therein;

          WHEREAS, as provided under the Credit Agreement, the Assignor has a Commitment to make Committed
Loans in an aggregate principal amount at any time outstanding not to exceed $                    ;

          WHEREAS, Committed Loans and Bid Loans made by the Assignor under the Credit Agreement in the
respective aggregate principal amounts of $                     and $                     are outstanding at the
date hereof; and

          WHEREAS, the Assignor proposes to assign to the Assignee all of the rights of the Assignor under
the Credit Agreement in respect of a portion of its Commitment thereunder in an amount equal to
$   **    (the “Assigned Amount”), together with $   *   
aggregate principal amount outstanding of Committed Loans and $   **   
aggregate principal amount outstanding of Bid Loans (collectively, the “Assigned Loans”), and the
Assignee proposes to accept assignment of such rights and assume the corresponding obligations from
the Assignor on the terms set forth in the Credit Agreement;

          NOW, THEREFORE, in consideration of the foregoing and the mutual agreements contained herein, the
parties hereto agree as follows:

          SECTION 1. Definitions. All capitalized terms not otherwise defined herein all shall have
the respective meanings set forth in the Credit Agreement.

          SECTION 2. Assignment. The Assignor hereby assigns and sells to the Assignee all of the
rights of the Assignor under the Credit Agreement to the extent of the Assigned Amount and the
Assigned Loans, and the Assignee hereby accepts such assignment from the Assignor and assumes all
of the obligations of the Assignor under the Credit Agreement to the

 

			
	*	 	See Section 13.4.1 for minimum requirements.
	 
	**	 	Assignment of Bid Loans is optional.

Form of Assignment and Assumption Agreement

 

 

-2-

extent of the Assigned Amount and the Assigned Loans. Upon the execution and delivery hereof by
the Assignor, the Assignee, the Company and the Agent and the payment of the amounts specified in
Section 3 required to be paid on the date hereof (i) the Assignee shall, as of the date hereof,
succeed to the rights and be obligated to perform the obligations of a Bank under the Credit
Agreement with a Commitment in an amount equal to the Assigned Amount, and (ii) the Commitment of
the Assignor shall, as of the date hereof, be reduced by a like amount and the Assignor released
from its obligations under the Credit Agreement to the extent such obligations have been assumed by
the Assignee. The assignment provided for herein shall be without recourse to the Assignor.

          SECTION 3. Payments. As consideration for the assignment and sale contemplated in Section
2 hereof, the Assignee shall pay to the Assignor on the date hereof in Federal funds an amount
equal to $   *   . It is understood that facility fees accrued to the date hereof
are for the account of the Assignor and such fees accruing from and including the date hereof are
for the account of the Assignee. Each of the Assignor and the Assignee hereby agrees that if it
receives any amount under the Credit Agreement which is for the account of the other party hereto,
it shall receive the same for the account of such other party to the extent of such other party’s
interest therein and shall promptly pay the same to such other party.

          SECTION 4. Consent of the Company and the Agent. This Agreement is conditioned upon the
consent of the Company and the Agent pursuant to Section 13.4.1 of the Credit Agreement. The
execution of this Agreement by the Company and the Agent is evidence of this consent. Pursuant to
Section 13.4.1 the Company agrees to execute and deliver a Bid Note and a Committed Note, each
payable to the order of the Assignee and evidencing the assignment and assumption provided for
herein, if so requested. If so requested, the Company also agrees to execute replacement Notes in
favor of the Assignor if the Assignor has retained any Commitment.

          SECTION 5. Non-Reliance on Assignor. The Assignor makes no representation or warranty in
connection with, and shall have no responsibility with respect to, the solvency, financial
condition, or statements of the Company, or the validity and enforceability of the obligations of
the Company in respect of the Credit Agreement or any Note. The Assignee acknowledges that it has,
independently and without reliance on the Assignor, and based on such documents and information as
it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement
and will continue to be responsible for making its own independent appraisal of the business,
affairs and financial condition of the Company.

          SECTION 6. Governing Law. This Agreement shall be governed by and construed in accordance
with the law of the State of New York.

 

			
	*     Amount should combine principal and face together with accrued
interest and breakage compensation, if any, to be paid by the Assignee, net of
any portion of any fee to be paid by the Assignor to the Assignee. It may be
preferable in an appropriate case to specify these amounts generically or by
formula rather than as a fixed sum.

Form of Assignment and Assumption Agreement

 

-3-

          SECTION 7. Counterparts. This Agreement may be signed in any number of counterparts, each
of which shall be an original, with the same effect as if the signatures thereto and hereto were
upon the same instrument.

          SECTION 8. Eligible Assignee. The Assignee hereby represents and warrants that it is an
Eligible Assignee as defined in the Credit Agreement.

          IN WITNESS WHEREOF, the parties have caused this Agreement to be executed and delivered by their
duly authorized officers as of the date first above written.

	 	 	 	 	 
	 	 	[ASSIGNOR]
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:
	 

	 	 	 	Title:
	 
	 	 	 	 
	 	 	[ASSIGNEE]
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:
	 

	 	 	 	Title:

	 	 	 	 	 
	Consented, and with respect to Section 4, agreed:	 	 
	 
	 	 	 	 
	INTERNATIONAL LEASE FINANCE CORPORATION	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

Name:
	 	 
	 

	 	Title:	 	 

Form of Assignment and Assumption Agreement

 

-4-

Consented:

CITICORP USA, INC.,

as Agent

	 	 	 	 	 
	By:

	 	 	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	Title:	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	Title:	 	 

Form of Assignment and Assumption Agreement

 

Exhibit J

FORM OF REQUEST FOR EXTENSION OF

TERMINATION DATE

                                        , ____

[ADDRESSED TO THE AGENT]

Attention:

Ladies and Gentlemen:

          This instrument constitutes a notice to the Agent of a request for the extension of the Termination
Date pursuant to Section 13.8 of the $2,500,000,000 Five-Year Revolving Credit Agreement, dated as
of October 13, 2006 (as amended, modified or supplemented, the “Credit Agreement”), among
International Lease Finance Corporation (the “Company”),Citicorp USA, Inc., in its
individual corporate capacity and as Agent, and certain financial institutions referred to therein.
Terms not otherwise expressly defined herein shall have the meanings set forth in the Credit
Agreement.

          The Company hereby requests that you distribute this letter to each Bank. The Company further
requests that each Bank extend its now scheduled Termination Date under the Credit Agreement by one
year and confirm its agreement to do so by countersigning a copy of this letter.

          The officer of the Company signing this instrument hereby certifies that:

          (a) Before and after giving effect to the extension of the Termination Date requested hereby, no
Event of Default or Unmatured Event of Default shall have occurred and be continuing and all Loans
payable prior to the date hereof shall have been paid in full; and

          (b) Before and after giving effect to the extension of the Termination Date requested hereby, the
representations and warranties set forth in Section 8 of the Credit Agreement shall be true and
correct in all material respects with the same effect as though made on the date hereof.

	 	 	 	 	 	 	 
	 	 	Very truly yours,	 	 
	 
	 	 	 	 	 	 
	 	 	INTERNATIONAL LEASE FINANCE

CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Its:	 	 	 	 
	 

	 	 	 	 	 	 

Form of Request for Extension of Termination Date

 

-2-

Confirmed and accepted, subject to the

terms and conditions of the Credit

Agreement, as of the date first above

written:

[NAME OF BANK]

	 	 	 	 	 
	By:

	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	Its:
	 	 	 	 

Form of Request
For Extension of Termination Date

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