Document:

EXHIBIT 4.1

NUMBER                                                                  SHARES

                                                                        CUSIP

                      INCORPORATED IN THE STATE OF DELAWARE

                               VENTUREDRIVE, INC.

                                  COMMON STOCK

THIS CERTIFIES THAT:

is owner of

         FULLY PAID AND NON-ASSESSABLE SHARES OF COMMON STOCK OF $.001
PAR VALUE EACH OF
                               VENTUREDRIVE, INC.
transferable on the books of the Corporation in person or by attorney upon
surrender of this certificate duly endorsed or assigned. This certificate and
the shares represented hereby are subject to the laws of the State of Delaware,
and to the Certificate of Incorporation and By-laws of the Corporation, as now
or hereafter amended. This certificate is not valid until countersigned by the
Transfer Agent.

         WITNESS the facsimile seal of the Corporation and the facsimile
signatures of its duly authorized officers.

DATED:

         SECRETARY                          SEAL                       PRESIDENT

                                                                  COUNTERSIGNED:

                                                   OLDE MONMOUTH STOCK TRANSFER
                                                            77 MEMORIAL PARKWAY
                                           ATLANTIC HIGHLANDS, NEW JERSEY 07716
                                                                 TRANSFER AGENT<PAGE>   1
                                                                   EXHIBIT 10.43

                      SETTLEMENT AND MODIFICATION AGREEMENT

        THIS SETTLEMENT AND MODIFICATION AGREEMENT (the "Settlement Agreement"),
effective as of the date upon which all parties have signed below (the
"Effective Date"), is by and between ASIVI, LLC, a Delaware limited liability
company, with offices at 1172 Castro Street, Mountain View, California 94040
("ASIVI"), VIVUS, INC., a Delaware corporation with a principal place of
business at 1172 Castro Street, Mountain View, California 94040 ("VI"),
ANDROSOLUTIONS, INC., a Tennessee corporation with a principal place of business
at Suite 309, 200 Fort Sanders West Blvd., Knoxville, TN 37922 (collectively
with its Affiliates, "ASI"), and Gary W. Neal, M.D., a natural person residing
at 4701 Guinn Road, Knoxville, TN 37931 ("GWN").

                                   BACKGROUND

        WHEREAS, the parties have commenced arbitration proceedings before the
American Arbitration Association captioned VIVUS, Inc. v. AndroSolutions, Inc.;

        WHEREAS, the parties, without admitting liability, wish to settle their
dispute by terminating and/or modifying the following agreements previously
entered into by the parties and by entering into this Settlement Agreement: the
Memorandum of Understanding dated October 14, 1999 ("MOU"); the Confidentiality
and Non-Disclosure Agreement dated December 16, 1999 (the "Confidentiality
Agreement"); the ASIVI, LLC Operating Agreement dated February 29, 2000
("Operating Agreement"); the License Agreement dated February 29, 2000 ("License
Agreement"); and the Manufacture and Supply Agreement dated February 29, 2000
("Manufacture and Supply Agreement");

        WHEREAS, ASI and VI formerly owned certain intellectual property
consisting of issued patents and/or pending patent applications relating to,
inter alia, the design, development, manufacture and use of products containing
a prostaglandin and/or other vasodilator for the treatment of female sexual
dysfunction ("FSD") which VI and ASI each assigned to ASIVI;

        WHEREAS, VI desires to obtain, and ASIVI desires to assign, the FSD IP
(as defined below) to develop and commercialize Products (as defined below) for
the treatment of FSD, on the terms and conditions herein;

        WHEREAS, VI desires to obtain, and ASI desires to assign, ASI's entire
interest in ASIVI;

        WHEREAS, VI desires to obtain, and ASI desires to assign, the
Supplemental FSD IP (as defined below); and

        WHEREAS, VI, in partial consideration for the assignment of the FSD IP,
the Supplemental FSD IP, and assignment of ASI's interest in ASIVI, and in order
to settle the dispute which is the subject of the arbitration with ASI, is
willing to make an upfront payment, certain milestone payments, and royalty
payments to ASI, and ASI is willing to accept such payments on the terms and
conditions herein.

<PAGE>   2

         NOW, THEREFORE, in consideration of the mutual covenants and
undertakings set out herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, ASIVI, VI, ASI and GWN
agree as follows:

1. DEFINITIONS

               1.1. "Affiliate" shall mean any corporation or other entity that
        controls, is controlled by or is under common control with a party. For
        purposes of this definition only, "control" shall mean ownership or
        control, directly or indirectly, of more than fifty percent (50%) of the
        shares or other rights of the subject entity entitled to vote in the
        election of directors (or, in the case of an entity that is not a
        corporation, to the election of the corresponding managing authority).

               1.2. "Commercially Reasonable Efforts" shall, with respect to a
        Product, mean efforts and resources equivalent to those normally
        employed by entities in the biopharmaceutical marketplace, substantially
        comparable to VI, to develop, manufacture, market or sell a product of
        similar market potential at a similar stage in its product life, taking
        into account for example the establishment of the Product in the
        marketplace, the competitiveness of alternative products, the
        proprietary position of the Product, the likelihood of regulatory
        approval, including consideration of safety and efficacy, for the
        Product given the regulatory authority and structure involved, the
        profitability of the Product and VI's available resources. Commercially
        Reasonable Efforts shall be determined on a market-by-market basis for
        each Product.

               1.3. "Confidential Information" shall mean only such information
        of another party to this Settlement Agreement that may be reasonably
        understood from legends or oral designations, the nature of the
        information itself or the circumstances of such information's
        disclosure, to be confidential or proprietary to another party or to a
        third party to which another party owes a duty of non-disclosure.

               1.4. "First Commercial Sale" shall mean, with respect to each
        Product in each country, the first bona fide commercial sale of such
        Product in such country by or under authority of VI.

               1.5. "FDA" shall mean the U.S. Food and Drug Administration, or
        any successor agency.

               1.6. "FSD IP" shall mean the Know How and Patent Rights, in each
        case that are owned or controlled by ASIVI as of the Effective Date, and
        all U.S. and foreign patents and patent applications claiming priority
        to the Patent Rights.

                    1.6.1. "Patent Rights" shall mean all United States and
               foreign patents (including all reissues, extensions,
               substitutions, re-examinations, supplementary protection
               certificates, and the like, and patents of addition) and pending
               patent applications (including without limitation all
               continuations, continuations-in-part and divisionals thereof)
               relating to, inter alia, the design, development, manufacture,
               and use of products containing a prostaglandin and/or other
               vasodilator for the treatment of FSD.

<PAGE>   3

                    1.6.2. "Know How" shall mean the Confidential Information
               owned or controlled by ASIVI pursuant to the terms of the MOU
               and/or the Operating Agreement necessary for the exercise of the
               Patent Rights, including technical data, protocols and methods.

               1.7. "IP Information" shall mean (***) the FSD IP formerly owned
        by ASI, and assigned to ASIVI pursuant to the Assignment Agreement
        executed by ASI and included in Exhibit 2 to the Operating Agreement
        along with the (***). IP Information shall include (***) in the FSD IP.
        IP Information shall further include (***)of the FSD IP.

               1.8. "Licensee" shall mean a third party to whom VI has granted a
        license or other right under the FSD IP to make, have made, import, have
        imported, export, have exported, distribute, have distributed, sell,
        have sold, use, or offer for sale Products.

               1.9. "NDA" shall mean a New Drug Application submitted to the
        FDA.

               1.10. "Net Sales."

                     1.10.1. "Net Sales by Licensees" shall mean the amount
               invoiced by VI's Licensees (for purposes of this definition, as
               applicable, the "Selling Party") for the sale of Products to bona
               fide independent third parties throughout the world, less (i)
               ordinary and customary trade discounts actually allowed by the
               Selling Party to the third party purchaser; (ii) credits, rebates
               and returns allowed and credited to the third party purchaser
               (including, but not limited to, wholesaler and retailer returns);
               (iii) freight, handling and duties paid on shipments by the
               Selling Party to the third party purchaser and separately
               identified on the invoice; and (iv) sales taxes, excise taxes,
               consumption taxes, customs duties and other compulsory payments
               to governmental authorities actually paid with respect to the
               sale by the Selling Party to the third party purchaser. For the
               avoidance of doubt, Net Sales by Licensees shall not include
               sales by a Selling Party to its Affiliates for resale; provided,
               however, that if the Selling Party sells a Product to an
               Affiliate for resale, Net Sales by Licensees shall include the
               amounts invoiced by such Affiliate to third parties on the resale
               of such Product.

                     1.10.2. "Net Sales by VI" shall mean the amount invoiced by
               VI or its Affiliates (for purposes of this definition, as
               applicable, the "Selling Party") for the sale of Products to bona
               fide independent third parties throughout the world, less (i)
               ordinary and customary trade discounts actually allowed by the
               Selling Party to the third party purchaser; (ii) credits, rebates
               and returns allowed and credited to the third party purchaser
               (including, but not limited to, wholesaler and retailer returns);
               (iii) freight, handling and duties paid on shipments by the
               Selling Party to the third party purchaser and separately
               identified on the invoice; and (iv) sales taxes, excise taxes,
               consumption taxes, customs duties and other compulsory payments
               to governmental authorities actually paid with respect to the
               sale by the Selling Party to the third party purchaser. For the
               avoidance of doubt, Net Sales by VI

<PAGE>   4

               shall not include sales by a Selling Party to its Affiliates or
               Licensees for resale; provided, however, that if the Selling
               Party sells a Product to an Affiliate or Licensees for resale,
               Net Sales shall include the amounts invoiced by such Affiliate or
               Licensees to third parties on the resale of such Product. For
               avoidance of doubt, Net Sales by VI shall also include Third
               Party Payments for the purpose of calculating royalties payable
               under Section 2.3.1.

                     1.10.3. "Bundles." In the case of discounts on "bundles" of
               products or services which include Products, Net Sales by
               Licensees and Net Sales by VI will be calculated by discounting
               the bona fide list price of such Product by the average
               percentage discount of all products of VI and/or its Licensees in
               a particular "bundle," calculated as follows:

               Average percentage discount on a particular bundle = (1 - A/B) x
               100

               where A equals the total discounted price of a particular
               "bundle" of products, and B equals the sum of the undiscounted
               bona fide list prices of each unit of every product in such
               "bundle." VI shall provide ASI documentation, reasonably
               acceptable to ASI, establishing such average discount with
               respect to each "bundle." If VI cannot so establish the average
               discount of a "bundle," Net Sales shall be based on the
               undiscounted list price of the Products in the "bundle." If a
               Product in a "bundle" is not sold separately and no bona fide
               list price exists for such Product, the parties shall negotiate
               in good faith an imputed list price for such Product, and Net
               Sales with respect thereto shall be based on such imputed list
               price.

               1.11. "Product" shall mean any product containing a prostaglandin
        and/or other vasodilator within the Field of Use, the sale of which
        would infringe upon a Valid Claim.

               1.12. "Valid Claim" means (i) a claim of an issued and unexpired
        patent included within the Patent Rights which has not been held
        unenforceable or invalid by a court or other governmental agency of
        competent jurisdiction, and which has not been disclaimed or admitted to
        be invalid or unenforceable through reissue or otherwise, or (ii) a
        claim of a pending patent application within the Patent Rights.

               1.13. "Field of Use" shall mean the diagnosis, prophylaxis and/or
        treatment involving female sexual dysfunction ("FSD"), including without
        limitation enhancing female sexual desire and responsiveness, and
        preventing, treating and/or managing female sexual arousal disorder,
        orgasmic disorder, and pain disorder.

               1.14. "Third Party Payments" shall mean any and all cash and
        non-cash consideration received by VI or VI's Affiliates for the grant
        of a license or other right attributable to the FSD IP related to the
        manufacturing, marketing, promotion, distribution, or sale of Products
        or other method, process or procedure covered by the FSD IP, including
        but not limited to initial lump-sum payments and milestones. All
        non-cash consideration will be valued at the fair market value thereof
        established by agreement of the parties or, failing that, by a qualified
        "Big 5" or

<PAGE>   5

        national independent accountant approved by VI and ASI. VI will bear the
        cost of such accountant. Third Party Payments shall be included within
        the definition of Net Sales by VI as of the date such Third Party
        Payments are actually received by VI for purposes of determining the
        applicable percentage of Third Party Payments to be paid to ASI under
        Section 2.3.1 of this Settlement Agreement.

               1.15. "Novel Chemical Entity" shall mean a new composition of
        matter having a molecular structure that was not previously found in
        nature or synthesized, and that is or comes to be conceived of or
        developed by ASI or GWN during the term of this Settlement Agreement.

               1.16. "Supplemental FSD IP" shall mean the patents and/or patent
        applications identified in Technology Assignment Agreement C, attached
        hereto as Exhibit 3.

2. PAYMENTS

               2.1. Upfront Payment. Within three (3) business days of the
        Effective Date, VI shall deposit with its counsel, Wilson Sonsini
        Goodrich & Rosati, a check in the sum of $750,000, payable to ASI,
        pending confirmation that pursuant to Section 12.1 ASI has furnished its
        counsel, Rothwell Figg Ernst & Manbeck, with all IP materials described
        in Section 12.1 and that ASI has directed its counsel to deposit such
        materials for overnight delivery to VI counsel. Upon receipt of such
        confirmation, VI shall direct its counsel to likewise deposit the
        $750,000 payment for overnight delivery to ASI counsel. VI shall ensure
        that the bank account from which the $750,000 check is drawn is
        sufficiently funded to allow for the immediate availability of the
        $750,000 upon ASI's deposit of said check. For the avoidance of doubt,
        the depositing of the $750,000 payment for overnight delivery to ASI
        counsel shall be made on the same day as the deposit of IP materials for
        overnight delivery to VI counsel under Section 12.1 of this Settlement
        Agreement.

                    2.1.1. ASI Right to Rescind. In the event that VI fails to
               deliver payment to ASI under this Section 2.1, ASI shall have the
               right to rescind this Settlement Agreement in its entirety.

               2.2. Milestone Payments. VI agrees to make the following one-time
        payments to ASI within thirty (30) days after achievement of the
        specified milestone: (i) (***) upon the first submission, by VI or on
        VI's behalf, of an NDA for a product covered by the Patent Rights; and
        (ii) (***) upon the first approval of an NDA for a product covered by
        the Patent Rights.

               2.3. Continuing Payments.

                    2.3.1. Payment to ASI on Net Sales by VI or its Affiliates.
               VI shall make payments to ASI at the applicable percentage of
               annual Net Sales by VI, as defined herein, as follows:

<PAGE>   6

<TABLE>
<CAPTION>
        Annual Net Sales by VI                                        Payment Rate
        ----------------------                                        ------------
        <S>                                                           <C>
        Up to (***)                                                       (***)
        (***)up to (***)                                                  (***)
        (***)up to (***)                                                  (***)
        Equal to or greater than (***)                                    (***)
</TABLE>

               2.3.2. Payment to ASI on Net Sales for Products Sold by
        Licensees. VI shall make payments to ASI at the applicable percentage of
        annual Net Sales by Licensees, as defined herein, as follows:

<TABLE>
<CAPTION>
        Annual Net Sales by Licensees                                 Payment Rate
        -----------------------------                                 ------------
        <S>                                                           <C>
        Up to (***)                                                       (***)
        (***)up to (***)                                                  (***)
        (***)up to (***)                                                  (***)
        (***)up to (***)                                                  (***)
        Equal to or greater than (***)                                    (***)
</TABLE>

               2.3.3. Third Party Royalties. If VI, or any Affiliate or
        Licensees of VI, becomes obligated to pay to third parties royalties or
        other amounts with respect to any Product through litigation or under
        agreements for patent rights or other technologies which VI or such
        Affiliate or Licensee determines are desirable to license or acquire
        with respect to such Product, VI shall be responsible for making such
        payments. VI shall not deduct such payments from any payments to ASI,
        and such payments shall not be deducted from gross invoiced amounts for
        Products in calculating Net Sales.

               2.3.4. One Payment. No more than one payment shall be due to ASI
        with respect to a sale of a particular Product or for a Third Party
        Payment received by VI.

                    2.3.5. Payment Term. The payments due under this Section 2.3
               shall be payable until the expiration of the last to expire Valid
               Claim.

3. PAYMENTS; REPORTS; AND RECORDS

        3.1. Payments.

               3.1.1. Timing of Payments. After the First Commercial Sale of a
        Product on which royalties are payable hereunder, VI shall make
        quarterly written reports to ASI within sixty (60) days after the end of
        each calendar quarter, stating in such report, separately for Net Sales
        by VI and Net Sales by Licensees, the number, description and aggregate
        Net Sales, by country, of each Product sold during the calendar quarter
        upon which a royalty is

<PAGE>   7

               payable. Concurrently with the making of such reports, VI shall
               pay to ASI payments due at the rates specified hereunder. This
               Section 3.1.1 shall not apply to any payments for Third Party
               Payments.

                    3.1.2. Timing of Payments for Third Party Payments. Within
               thirty (30) days following VI's actual receipt of any Third Party
               Payment, VI shall pay any amount due ASI for such Third Party
               Payment, at the applicable percentage set forth in Section 2.3.1,
               and provide written notice to ASI indicating the amount of Third
               Party Payment received and the percentage rate applied to such
               amount.

                    3.1.3. Payment Method. All payments due under this
               Settlement Agreement shall be made by bank wire transfer in
               immediately available funds to a bank account designated by ASI,
               with the exception of the Upfront Payment set forth in Section
               2.1 above. All payments due to ASI hereunder shall be paid in
               United States dollars.

                    3.1.4. Currency Conversion. If any currency conversion shall
               be required in connection with the calculation of amounts payable
               hereunder, such conversion shall be made using the buying
               exchange rate for conversion of the foreign currency into U.S.
               Dollars, quoted for current transactions reported in The Wall
               Street Journal (U.S., Western Edition) for the last business day
               of the calendar quarter to which such payment pertains.

                    3.1.5. Taxes. All payments required to be paid to ASI
               pursuant to this Settlement Agreement shall be paid with
               deduction for withholding for or on account of any applicable
               sales, use, value-added, or other federal, state or local taxes
               or import duties or tariffs, or similar governmental charges
               imposed by a jurisdiction other than the United States
               ("Withholding Taxes"). VI shall provide ASI a certificate
               evidencing payment of any Withholding Taxes hereunder, and shall
               provide any further assistance reasonably requested by ASI to
               enable ASI to obtain the benefit of any deduction.

               3.2. Reports; Inspection. VI shall maintain accurate books and
        records that enable the calculation of royalties payable hereunder to be
        verified. VI shall retain the books and records for each calendar year
        period for three (3) years after the submission of the corresponding
        report under Section 3.1.1 hereof. Upon thirty (30) days prior notice to
        VI, independent accountants selected by ASI, which shall be from a "Big
        5" or national accounting firm and reasonably acceptable to VI, after
        entering into a confidentiality agreement with VI, may have access to
        VI's books and records during VI's normal business hours to conduct a
        review or audit once per calendar year, for the sole purpose of
        verifying the accuracy of VI's payments and compliance with this
        Settlement Agreement. Any such inspection or audit shall be at ASI's
        expense, however, if an inspection reveals underpayment of five percent
        (5%) or more in any audit period, VI shall pay the costs of the
        inspection. VI shall promptly pay to ASI any underpayment identified in
        such an audit.

4. CONFIDENTIALITY

<PAGE>   8

               4.1. Termination of Confidentiality Agreement. The
        Confidentiality and Non-Disclosure Agreement, dated December 16, 1999,
        by and between ASI, VI and ASIVI, is hereby terminated and any
        information deemed Confidential Information under that Confidentiality
        and Non-Disclosure Agreement shall be deemed Confidential Information
        under this Settlement Agreement.

               4.2. Confidentiality Obligations. Except as expressly provided
        herein, the party in receipt of Confidential Information (the "Receiving
        Party") shall not disclose to any third party or use for any purpose any
        Confidential Information furnished to it by the other party (the
        "Disclosing Party"). Notwithstanding the foregoing, Confidential
        Information shall not include any information that, in each case as
        demonstrated by written documentation: (i) was already known to the
        Receiving Party, other than under an obligation of confidentiality, at
        the time of disclosure; (ii) was generally available to the public or
        otherwise part of the public domain at the time of its disclosure to the
        Receiving Party; (iii) became generally available to the public or
        otherwise part of the public domain after its disclosure and other than
        through any act or omission of the Receiving Party in breach of this
        Settlement Agreement; (iv) was subsequently lawfully disclosed to the
        Receiving Party by a third party who did not acquire it directly or
        indirectly from the Disclosing Party; or (v) was developed by the
        Receiving Party without use of or reference to any Confidential
        Information of the Disclosing Party.

               4.3. Permitted Use and Disclosures. The Receiving Party may use
        and disclose the Confidential Information of the Disclosing Party to the
        extent necessary to exercise its rights or perform its obligations under
        this Settlement Agreement, in filing or prosecuting applications and
        patents, prosecuting or defending litigation, complying with applicable
        governmental regulations or court order or otherwise submitting
        information to tax or other governmental authorities, conducting trials,
        or making a permitted sublicense or otherwise exercising rights
        expressly granted to it pursuant to the terms of this Settlement
        Agreement, provided that if the Receiving Party is required to make any
        such disclosures of the Disclosing Party's Confidential Information,
        other than pursuant to a confidentiality agreement, it shall give
        reasonable advance notice to the Disclosing Party of such disclosure
        and, save to the extent inappropriate in the case of patent
        applications, shall use its reasonable efforts to secure confidential
        treatment of such Confidential Information in consultation with the
        Disclosing Party prior to its disclosure (whether through protective
        orders or otherwise) and disclose only that portion of the Confidential
        Information necessary to comply with such requirements.

               4.4. Confidential Terms. Each party agrees not to disclose any
        terms of this Settlement Agreement to any third party without the
        consent of the other party; provided, disclosures may be made as
        necessary in the exercise of a party's rights under this Settlement
        Agreement, as required by securities or other applicable laws, or to a
        party's accountants, attorneys and other professional advisors, or by
        VI, ASIVI, and ASI to actual or prospective investors or corporate
        partners.

<PAGE>   9

               4.5. Information Furnished Under Settlement Agreement. All
        information and materials furnished by a party to another party pursuant
        to or in connection with the terms of this Settlement Agreement shall be
        treated as Confidential Information, including but not limited to
        information furnished under Sections 3.1, 12.1, and 15.9.

5. REPRESENTATIONS, WARRANTIES AND COVENANTS

               5.1. ASIVI. ASIVI represents and warrants to VI, ASI, and GWN
        that: (i) it is a limited liability company duly organized, validly
        existing and in good standing under the laws of the State of Delaware;
        and (ii) the execution, delivery and performance of this Settlement
        Agreement have been duly authorized by all necessary company action on
        the part of ASIVI; (iii) it is the sole, equal, and exclusive owner of
        all right, title and interest in the FSD IP; (iv) it has the right to
        grant the rights granted herein, and the FSD IP is free and clear of any
        lien, encumbrance or security interest; (v) it has not previously
        granted, and will not grant, any right, license or interest in and to
        the FSD IP, or any portion thereof, inconsistent with the assignment to
        VI; and (vi) there are no threatened or pending actions, lawsuits,
        claims or arbitration proceedings in any way relating to the FSD IP,
        other than the arbitration proceeding referenced in the Recitals above.

               5.2. VI. VI represents, warrants and covenants to ASIVI, ASI, and
        GWN that: (i) it is a corporation duly organized, validly existing and
        in good standing under the laws of the State of Delaware; (ii) the
        execution, delivery and performance of this Settlement Agreement have
        been duly authorized by all necessary corporate action on the part of
        VI; (iii) it will use Commercially Reasonable Efforts to develop and
        commercialize Products under the FSD IP; and (iv) it will use good faith
        efforts to obtain and maintain the Patent Rights.

               5.3. ASI, GWN. ASI and GWN represent, warrant and covenant to VI
        and ASIVI as follows:

                    5.3.1. ASI is a corporation duly organized, validly existing
               and in good standing under the laws of the State of Tennessee.

                    5.3.2. The execution, delivery and performance of this
               Settlement Agreement have been duly authorized by all necessary
               corporate action on the part of ASI.

                    5.3.3. The Supplemental FSD IP includes all patents and
               pending patent applications, which are owned or controlled as of
               the Effective Date by ASI or GWN, or their Affiliates or
               beneficiaries, that that relate to the Field of Use; that, as of
               the Effective Date, no other such patents or patent applications
               exist; that, as of the Effective Date, neither ASI nor GWN, nor
               their Affiliates or beneficiaries, have transferred, assigned or
               licensed any rights in such patents and patent applications to
               any third-party; and that there are no threatened or pending
               actions, lawsuits, claims or arbitration proceedings in any way

<PAGE>   10

               relating to such patents and patent applications, other than the
               arbitration proceeding referenced in the Recitals above;

                    5.3.4. ASI and GWN have previously transferred to ASIVI all
               of the patents and pending patent applications owned or
               controlled as of February 29, 2000 by ASI or GWN, or their
               Affiliates or beneficiaries, that relate to the design,
               development, manufacture, or use of products containing a
               prostaglandin and/or other vasodilator within the Field of Use;
               and

                    5.3.5. ASI and GWN have, concurrent with the execution of
               this Settlement Agreement, assigned to VI all of the patents and
               pending patent applications owned or controlled as of the
               Effective Date by ASI or GWN, or their Affiliates or
               beneficiaries, that relate to the Field of Use.

                    5.3.6. ASI and GWN have not assigned, licensed, sold or
               otherwise transferred any patents or patent applications that
               relate to the Field of Use during the period from February 29,
               2000 up to and including the Effective Date of this Settlement
               Agreement

6. INTELLECTUAL PROPERTY

               6.1. Prosecution and Maintenance of Patent Rights. As provided by
        Technology Assignment Agreement A, Technology Assignment Agreement B,
        and Technology Assignment Agreement C, attached hereto as Exhibits 1, 2
        and 3, respectively, VI shall, at its expense, have the sole right to
        file, prosecute, maintain and enforce the Patent Rights, including
        without limitation the patents and patent applications encompassed
        thereby. VI shall not be entitled to offset any amount expended in
        connection with such activities against payments, if any, due under
        Article 2 of this Settlement Agreement. ASI and GWN shall provide any
        cooperation reasonably requested by VI in connection therewith,
        including but not limited to the IP Information delivered to VI pursuant
        to Section 12.1 below.

               6.2. No Liens. ASIVI or VI shall not incur, nor suffer to exist,
        any lien, claim or other encumbrance on any of the FSD IP.

               6.3. Enforcement. If either ASIVI, ASI, or GWN become aware that
        any Patent Rights are being infringed by any third party, such party
        shall promptly notify VI in writing describing the facts relating
        thereto in reasonable detail. As provided in Technology Assignment
        Agreement A, Technology Assignment Agreement B and Technology Assignment
        Agreement C, attached hereto as Exhibits 1, 2 and 3, respectively, VI
        shall have the sole right, in its discretion, to institute any action,
        suit or proceeding, including any declaratory judgment action (each an
        "Action"), at its expense, using counsel of its choice. ASI shall
        provide any cooperation reasonably requested by VI in connection with
        any such Action, at VI's expense. VI shall retain any amount recovered
        in any such Action, but shall not be entitled to offset any amount
        expended in connection with any such Action against payments, if any,
        due under Article 2.

<PAGE>   11

7. DISPUTE RESOLUTION

               7.1. Settlement of Disputes. The parties will attempt to settle
        any dispute, controversy or claim between them arising out of or
        relating to the validity, construction, enforceability or performance of
        this Settlement Agreement, including disputes relating to alleged breach
        or to termination of this Settlement Agreement (each, a "Dispute")
        through consultation and negotiation in good faith and in the spirit of
        mutual cooperation.

               7.2. Failure to Settle Dispute. If those attempts fail, then the
        Dispute may be made the subject of a lawsuit. If VI or ASIVI initiates
        such a suit, it shall be filed and litigated in the state or federal
        court in or for Knoxville, Tennessee. If ASI or GWN initiates such a
        suit, it shall be filed and litigated in the state or federal court in
        or for Santa Clara County, California.

               7.3. Specific Performance. The parties hereto acknowledge that
        recovery of damages will be an inadequate remedy for a breach of the
        provisions of this Settlement Agreement and agree that, in the event of
        any such breach or threatened breach, the respective rights and
        obligations hereunder shall be enforceable by specific performance,
        injunction, or other equitable relief, but nothing herein contained is
        intended to, nor shall it, limit or affect any rights at law or by
        statute or otherwise of any party aggrieved as against another for such
        breach, it being the intention of the parties by this Section 7.3 to
        make clear their agreement that their respective rights and obligations
        in this Settlement Agreement shall be enforceable in equity as well as
        at law or otherwise.

               7.4. Expenses. Should any party breach this Settlement Agreement,
        in addition to all other remedies available at law or in equity or
        otherwise, such party shall pay all of any other party's costs and
        expenses resulting therefrom and/or incurred in enforcing this
        Settlement Agreement, including legal fees and expenses.

8. INDEMNIFICATION

               8.1. Indemnification of ASI, GWN. VI and ASIVI shall indemnify,
        defend and hold harmless ASI and its directors, officers and employees,
        and GWN (each an "ASI Indemnitee") from and against any and all
        liabilities, damages, losses, costs or expenses (including reasonable
        attorneys' and professional fees and other expenses of litigation and/or
        arbitration) (a "Liability") resulting from a claim, suit or proceeding
        (any of the foregoing, a "Claim") brought by a third party against an
        ASI Indemnitee, arising from or occurring as a result of (i) a material
        breach by VI or ASIVI of their respective obligations under this
        Settlement Agreement, (ii) the negligence or willful misconduct of VI or
        of ASIVI, or (iii) activities performed by ASIVI, VI, its Affiliates, or
        its Licensees in connection with the development, manufacture or sale of
        any Product, except to the extent caused by the negligence or willful
        misconduct of ASI.

               8.2. Indemnification of VI and ASIVI. ASI and GWN shall
        indemnify, defend and hold harmless VI and ASIVI and their respective
        directors, officers and employees (each a "VI

<PAGE>   12

        Indemnitee") from and against any and all liabilities, damages, losses,
        costs or expenses (including reasonable attorneys' and professional fees
        and other expenses of litigation and/or arbitration) (a "Liability")
        resulting from a claim, suit or proceeding (any of the foregoing, a
        "Claim") brought by a third party against a VI Indemnitee, arising from
        or occurring as a result of (i) a material breach by ASI or GWN of their
        respective obligations under this Settlement Agreement, (ii) the
        negligence or willful misconduct of ASI or of GWN, or (iii) ASI's or
        GWN's use of the FSD IP, except to the extent caused by the negligence
        or willful misconduct of VI, its Affiliates, or Licensees, or of ASIVI.

               8.3. Indemnification Procedures. In the event that an Indemnitee
        intends to claim indemnification under this Article 8, it shall promptly
        notify the other party (the "Indemnitor") in writing of such alleged
        Liability. The Indemnitor shall have the sole right to control the
        defense and/or settlement thereof, provided that the indemnified party
        may participate in any such proceeding with counsel of its choice at its
        own expense. The indemnity agreement in this Article 8 shall not apply
        to amounts paid in settlement of any Claim if such settlement is
        effected without the consent of the Indemnitor, which consent shall not
        be withheld unreasonably. The failure to deliver written notice to the
        Indemnitor within a reasonable time after the commencement of any such
        action, if prejudicial to its ability to defend such action, shall
        relieve such Indemnitor of any liability to the Indemnitee under this
        Article 8 but the omission so to deliver written notice to the
        Indemnitor shall not relieve the Indemnitor of any liability that it may
        have to any Indemnitee other than under this Article 8. The Indemnitee
        under this Article 8, its employees and agents, shall cooperate fully
        with the Indemnitor and its legal representatives and provide full
        information in the investigation of any Claim covered by this
        indemnification. Neither party shall be liable for any costs or expenses
        incurred by the other party without its prior written authorization.

9. TERM AND TERMINATION

               9.1. Term. The term of this Settlement Agreement shall commence
        on the Effective Date, and unless earlier terminated as provided in this
        Article 9, shall continue in full force and effect until the expiration
        of the last to expire Valid Claim.

               9.2. Termination for Cause. VI and ASIVI will have the right to
        terminate this Settlement Agreement upon sixty (60) days notice of a
        material breach by ASI or GWN, provided that ASI or GWN may avoid such
        termination if before the end of such sixty (60) day period ASI or GWN
        cures such breach or default. ASI and GWN will have the right to
        terminate this Settlement Agreement upon sixty (60) days notice of a
        material breach by VI or ASIVI, provided that VI or ASIVI may avoid such
        termination if before the end of such sixty (60) day period VI or ASIVI
        cures such breach or default. However, if the party accused of breach
        disputes an asserted breach in writing within such sixty (60) day
        period, the non-breaching party shall not have the right to terminate
        this Settlement Agreement unless and until it has been determined in a
        legal proceeding conducted pursuant to Section 7.2 that this Settlement

<PAGE>   13

        Agreement was materially breached, and the party accused of the breach
        fails to cure the breach within sixty (60) days after such
        determination.

               9.3. Termination for Dissolution, Transfer of Interest to ASI. In
        the event that VI is dissolved and permanently ceases its business
        operations, ASI may terminate this Settlement Agreement and, to the
        extent permitted by law, shall immediately become a joint owner with VI
        of all right, title, and interest in and to the FSD IP, including the
        Patent Rights. VI agrees to cooperate in good faith and to take any
        reasonable action necessary to effectuate such joint ownership upon such
        dissolution.

               9.4. Accrued Rights and Obligations. Termination of this
        Settlement Agreement for any reason shall not release any party hereto
        from any liability which, at the time of such termination, has already
        accrued to the other party or which is attributable to a period prior to
        such termination, nor preclude either party from pursuing any rights and
        remedies it may have hereunder or at law or in equity which accrued or
        are based upon any event occurring prior to such termination.

               9.5. Survival. The following provisions of this Settlement
        Agreement shall survive termination of this Settlement Agreement for any
        reason: Articles 1, 4, 6, 7, 9, 10, 11, 12, 13, 15, and 16, and Sections
        14.1, 14.2, 14.3, 14.4, 14.5, 14.7, and 14.9. In the event that this
        Settlement Agreement is terminated under Section 9.2 as a result of a
        material breach, Sections 14.8.1 and 14.8.2 shall also survive such
        termination.

10. SETTLEMENT

               10.1. Settlement of all Claims and Counterclaims. This Settlement
        Agreement resolves, satisfies, and settles all claims and counterclaims
        involved in the aforementioned arbitration proceedings.

11. LICENSE AGREEMENT

               11.1. Termination of License Agreement. The License Agreement
        entered into by and between VI and ASIVI dated February 29, 2000 is
        hereby terminated, and the parties thereto are released of all of their
        rights and obligations thereunder. For the avoidance of doubt, the
        survival provisions of Section 11.5 of the License Agreement are
        likewise terminated and do not survive.

               11.2. Effect of Termination of License Agreement. Termination of
        the License Agreement pursuant to this Settlement Agreement will not be
        deemed (a) to be a Dissolving Event permitting dissolution of ASIVI
        pursuant to Section 8 of the Operating Agreement, and (b) to permit
        termination of the Manufacturing and Supply Agreement between VI and ASI
        dated February 29, 2000.

<PAGE>   14

12.     IP ANALYSIS

               12.1. Information and Analysis. Within three (3) business days of
        the Effective Date, ASI shall deposit with its counsel, Rothwell Figg
        Ernst & Manbeck, all IP Information, (***) of the patents and patent
        applications that ASI assigned to ASIVI. ASI shall direct its counsel to
        prepare all such materials for overnight delivery to the offices of VI
        counsel, Wilson Sonsini Goodrich & Rosati, 650 Page Mill Rd., Palo Alto,
        California 94304, and upon receipt of confirmation that VI counsel is in
        custody of the payment for ASI described in Section 2.1 above, to
        deposit all such IP Information materials for shipment in the manner
        previously described. VI may use all IP Information and materials
        furnished by ASI in order to (***) and to exercise its rights under this
        Settlement Agreement. At VI's reasonable request and direction, ASI
        agrees to cooperate with VI in (***). For the avoidance of doubt, the
        depositing of IP materials for overnight delivery shall be made on the
        same day as the deposit of the $750,000 payment for overnight delivery
        under Section 2.1 of this Settlement Agreement.

        The parties acknowledge that ASI has previously furnished counsel for VI
        with certain IP Information, and that additional copies of such
        materials need not be provided in the manner described above.
        Nonetheless, ASI and GWN agree to that they shall ensure that VI is in
        receipt of all IP Information, whether previously furnished or not.

13. MEMORANDUM OF UNDERSTANDING

               13.1. Termination of Memorandum of Understanding. The MOU entered
        into by and between VI and ASI dated October 14, 1999 is hereby
        terminated, and the parties thereto are released of all of their rights
        and obligations thereunder. For the avoidance of doubt, any survival
        provisions of the MOU are terminated and do not survive.

14. ASIVI OPERATING AGREEMENT

               14.1. Assignment of FSD IP to VI. ASIVI hereby transfers and
        assigns to VI its entire right, title, and interest in the FSD IP.
        Assignment of the Patent Rights is provided for in Technology Assignment
        Agreement A and Technology Assignment Agreement B, attached hereto as
        Exhibits 1 and 2, respectively. Such assignments to VI shall include all
        rights to use and practice the FSD IP and to make, use and sell
        Products.

               14.2. Modification to Allow Transfer of Interest. Section 7.1 of
        the ASIVI Operating Agreement is deleted in its entirety, and in its
        place inserted the following: "A Member may Transfer all of its Interest
        to another Member."

               14.3. Transfer and Consent to Transfer of Interest of Managing
        Member. ASI hereby transfers and assigns, and VI hereby consents to the
        transfer and assignment by ASI, to VI its entire interest in ASIVI.

<PAGE>   15

               14.4. Effect of Transfer of Interest. The transfer of ASI's
        interest in ASIVI to VI:

                     14.4.1. will relieve ASI of all obligations and liabilities
               arising under the Operating Agreement.

                     14.4.2. will not entitle ASI to any redemption of its
               interest, distribution, or payment in connection with its
               assignment other than as set forth in this Settlement Agreement.

               14.5. Deletion of Sections. Sections 4.6, 5.4, 8.1(e), 8.1(f),
        8.2(d)(iii), 11.4, 11.5, 11.6, and 11.7 are hereby deleted from the
        Operating Agreement in their entirety.

               14.6. Initial Publication. The initial publication of a clinical
        study resulting from Product development shall list GWN as the lead
        author.

               14.7. Retention of Rights; Abandonment of Supplemental FSD IP. To
        the extent that any portion of the U.S. Provisional Patent Application
        filed on September 8, 2002 set forth in Technology Assignment Agreement
        C, attached hereto as Exhibit 3, discloses, claims, and/or relates to
        subject matter that is outside the field of sexual function in men and
        women, all rights in and to such subject matter shall be retained by
        ASI. Except with respect to that subject matter retained by ASI pursuant
        to this Section 14.7, if any, ASI shall not claim priority to any patent
        or patent application that is the subject of the Patent Rights or the
        Supplemental FSD IP.

        Following the Execution Date of this Settlement Agreement, VI agrees to
        (***)

<PAGE>   16

               14.8. Covenants Not to Sue.

                     14.8.1. VI Covenant Not to Sue. VI shall not make, or
               threaten to make, any claim against ASI or GWN alleging
               infringement of any Valid Claim based on the conduct by ASI or
               GWN of (i) basic research and testing within the Field of Use for
               non-commercial purposes, (ii) direct patient care by GWN, or
               (iii) activities outside the Field of Use. The covenant set forth
               in this Section 14.8.1 shall not extend to activities within the
               Field of Use related to research, testing and development of
               products for commercial purposes, and shall not be construed as a
               grant of any rights to ASI or GWN under any Investigational New
               Drug application of ASIVI or VI, or under any other patent or
               other intellectual property owned or controlled by VI, including
               without limitation the patents and patent applications
               encompassed by the Patent Rights. The performance by ASI or GWN
               of any activities under the covenant set forth in this Section
               14.8.1 shall not result in any liability of ASIVI or VI, and ASI
               and GWN agree to indemnify ASIVI and VI to the extent of any such
               liability. The covenant granted herein is independent of the
               option and conditional license grant set forth in that certain
               Manufacture and Supply Agreement between VIVUS, Inc. and
               AndroSolutions, Inc. dated February 29, 2000. Notwithstanding
               Section 16.3 below, the covenant set forth in this Section 14.8.1
               is personal to ASI and GWN and may not be assigned or otherwise
               transferred.

                     14.8.2. ASI, GWN Covenant Not to Sue and Statement of
               Non-Liability. ASI and GWN shall not make, or threaten to make,
               any claim against VI, its Affiliates or Licensees alleging
               infringement based upon VI's, its Affiliates' or its Licensees'
               making, having made, importing, having imported, exporting,
               having exported, distributing, having distributed, selling,
               having sold, using, or offering for sale products within the
               Field of Use. ASI and GWN further agree that VI, its Affiliates
               or Licensees cannot be held liable for infringement of a right
               purportedly originating from ASI or GWN relating to the Field of
               Use. The parties acknowledge and agree that the covenant not to
               sue and statement of non-liability set forth in this Section
               14.8.2 is intended to and shall bind all present and future
               successors, heirs, assigns, and licensees of GWN or ASI who come
               to acquire any rights from GWN or ASI relating to products within
               the Field of Use, and ASI and GWN shall provide any such third
               parties with notice of the covenant not to sue and the statement
               of non-liability.

               ASI and GWN further covenant that they shall, within ten (10)
               days of the Effective Date for any existing patents or patent
               applications, or concurrently with the filing of any patent
               application after the Effective Date, record with the U.S. Patent
               and Trademark Office, or other appropriate government entity in
               the case of international patents, a short form of the covenant
               contained in this Section 14.8.2, in the form attached hereto as
               Exhibit 4, in connection with any patent or patent application
               within the Field of Use.

               The covenant set forth in this Section 14.8.2 shall not extend to
               activities by VI, its

<PAGE>   17

               Affiliates, or its Licensees (i) for products not within the
               Field of Use, or (ii) involving the use of a Novel Chemical
               Entity in a product. In addition, other than the covenant set
               forth in this Section 14.8.2, this Section 14.8.2 shall not be
               construed as a grant of any other rights to VI, its Affiliates,
               or its Licensees under any intellectual property owned or
               controlled by ASI or GWN. The performance by VI, its Affiliates,
               and its Licensees of any activities under the covenant set forth
               in this Section 14.8.2 shall not result in any liability of ASI
               or GWN, and VI agrees to indemnify ASI and GWN to the extent of
               any such liability.

               14.9. ASIVI Dissolution. Subsequent dissolution of ASIVI, for
        whatever reason, shall have no effect on this Settlement Agreement
        whatsoever.

15. MANUFACTURE AND SUPPLY AGREEMENT

               15.1. Modification of Definitions. The following terms in the
        Manufacture and Supply Agreement shall have the same meaning and
        definition as set forth in this Settlement Agreement, notwithstanding
        the definitions provided in the Manufacture and Supply Agreement: "FSD
        IP," "Product," and Valid Claim."

                     15.1.1. FSD IP. All references to or use of the term "ASIVI
               Technology" in the Manufacture and Supply Agreement are deleted,
               and in their place inserted the term "FSD IP."

               15.2. Deletion of Sections. The following Sections are deleted in
        their entirety from the Manufacture and Supply Agreement: 1.3, 1.7,
        1.7.1, 1.7.2, 1.8, 1.10, and 9.

               15.3. Independent Accountant. Section 4.1 of the Manufacturing
        and Supply Agreement is modified by adding the following text at the end
        of the section: "Any accountant chosen or designated under this Section
        4.1 shall be limited to a "Big 5" or national accounting firm."

               15.4. Payments Cumulative. Section 4.3 of the Manufacture and
        Supply Agreement is modified as follows: all text in Section 4.3 after
        the word "certain" is deleted, and in its place inserted the following:
        "Settlement Agreement executed in July 2001."

               15.5. Termination. Section 8.1 of the Manufacture and Supply
        Agreement is modified as follows: the reference to "License Agreement"
        is deleted, and in its place inserted the following: "Settlement
        Agreement executed in July 2001."

               15.6. Assignment. Section 10.5 is deleted in its entirety, and in
        its place inserted the following: "Neither party may assign this Supply
        Agreement or any of its rights or obligations hereunder except with the
        written consent of the other party."

               15.7. VI Best Efforts. Section 3.1 of the Manufacturing and
        Supply Agreement is modified by adding the following text at the end of
        the section: "To the extent practicable, VI agrees to

<PAGE>   18

        use its best efforts to cause each of its Licensees, if any, to: (i)
        purchase its requirements for Product from VI, or (ii) purchase the
        Applicable Percentage of such Licensee's requirements of Product
        directly from ASI.

               15.8. Confidentiality. Article 5 of the Manufacture and Supply
        Agreement is deleted in its entirety, and in its place inserted the
        following: "The definition of Confidential Information under Section 1.3
        of the Settlement Agreement and the parties' rights and obligations in
        connection therewith under Article 4 of the Settlement Agreement are
        incorporated by reference herein."

               15.9. VI Disclosure of Manufacturing Specifications, Good Faith
        Cooperation. In order for ASI to evaluate and consider the exercise of
        its option under Section 2.1 of the Manufacture and Supply Agreement, VI
        shall provide to ASI written notice of its intention to submit an NDA
        for a Product within nine (9) months of such submission. Upon such
        notice from VI, ASI shall, within 30 days, provide VI with written
        notice that ASI desires to evaluate its manufacturing option, that ASI
        possesses the financial wherewithal and capacity to exercise such
        option, and that it possesses a good faith and reasonable expectation
        that it is able to exercise such option, furnishing VI with
        contemporaneous evidence reasonably sufficient to support ASI's
        representations as to financial wherewithal, capacity and expectations.
        Upon such notice from ASI, VI shall, within twenty (20) days, disclose
        the following information relating to the Product that VI reasonably
        believes will be included in such submission: (i) specifications and
        test methods for the excipients, active ingredient, drug product, and
        container closure system; (ii) formulation and master batch records; and
        (iii) manufacturing equipment list and specifications. The parties
        acknowledge and agree that the aforementioned information may be
        modified at any time and is subject to FDA approval. VI agrees to notify
        ASI of any such modifications and shall update or supplement the
        disclosures required under this Section 15.9 accordingly. VI further
        agrees to cooperate in good faith and, at ASI's reasonable request, to
        provide such additional information necessary and proper for ASI to
        obtain the full benefit of its option under Section 2.1 of the
        Manufacture and Supply Agreement.

               15.10. Notices. Section 10.3 of the Manufacture and Supply
        Agreement is deleted in its entirely, and in its place inserted the
        following: "Any notice required or permitted by this Manufacture and
        Supply Agreement shall be in writing and shall be sent by hand delivery,
        by prepaid registered or certified mail, return receipt requested, or by
        facsimile transmission, addressed to the other party at the address
        shown in Section 16.4 of the Settlement Agreement or at such other
        address for which such party gives notice hereunder. Such notice shall
        be deemed to have been given upon delivery, if sent by hand delivery,
        three (3) days after deposit in the mail, or upon transmission by
        facsimile."

<PAGE>   19

16. MISCELLANEOUS

               16.1. Governing Law. This Settlement Agreement shall be governed
        by and construed in accordance with the laws of the State of Delaware,
        without reference to its conflicts of laws provisions.

               16.2. Independent Contractors. The relationship of the parties
        hereto is that of independent contractors. The parties hereto are not
        deemed to be agents, partners or joint ventures of the other for any
        purpose as a result of this Settlement Agreement or the transactions
        contemplated thereby. Neither party shall have the power to obligate or
        bind the other party in any manner whatsoever.

               16.3. Assignment. The parties agree that their rights and
        obligations under this Settlement Agreement shall not be delegated,
        transferred or assigned to a third party without the prior written
        consent of the other party hereto; provided that either party may assign
        all of its rights and obligations under this Settlement Agreement,
        without the other party's consent (a) to its Affiliates, and (b) to an
        entity that acquires all or substantially all of the business or assets
        of the assigning party to which this Settlement Agreement pertains,
        whether by merger, reorganization, acquisition, sale or otherwise; which
        Affiliate or acquiring entity (y) agrees in a writing provided to the
        non-assigning party prior to any assignment, to assume all of the
        obligations of the assigning party hereunder, and (z) has provided to
        the non-assigning party evidence reasonably satisfactory to the
        non-assigning party of its ability to perform all such obligations in a
        timely manner. This Settlement Agreement shall be binding upon and inure
        to the benefit of the parties and their successors and permitted
        assigns.

               16.4. Notices. Any notice required or permitted by this
        Settlement Agreement shall be in writing and shall be sent by hand
        delivery, by prepaid registered or certified mail, return receipt
        requested, or by facsimile transmission, addressed to the other party at
        the address shown below or at such other address for which such party
        gives notice hereunder. Such notice shall be deemed to have been given
        upon delivery, if sent by hand delivery, three (3) days after deposit in
        the mail, or upon transmission by facsimile.

<PAGE>   20

        To ASIVI:            ASIVI, LLC
                             1172 Castro Street
                             Mountain View, California  94040
                             Attention: Legal Affairs
                             Facsimile: (650) 934-5389

        With a copy to:      Wilson Sonsini Goodrich & Rosati, PC
                             650 Page Mill Road
                             Palo Alto, CA 94304
                             Attention:  Mark Casper, Esq.
                             Facsimile: (650) 496-4082

        To VIVUS:            VIVUS, Inc.
                             1172 Castro Street
                             Mountain View, CA  94040
                             Attention:  Legal Affairs
                             Facsimile: (650) 934-5389

        With a copy to:      Wilson Sonsini Goodrich & Rosati, PC
                             650 Page Mill Road
                             Palo Alto, CA 94304
                             Attention:  Mark Casper, Esq.
                             Facsimile: (650) 496-4082

        To ASI:              AndroSolutions, Inc.
                             200 Fort Sanders West Blvd., Suite 309
                             Knoxville, TN 37922
                             Attention:  Gary W. Neal, M.D., President
                             Facsimile: (865) 531-6550

        With a copy to:      Zoltick Technology Law Group, PLLC
                             Loudoun Tech Center
                             21515 Ridgetop Circle, Suite 200
                             Sterling, VA 20166
                             Attention:  Martin M. Zoltick, Esq.
                             Facsimile: (571) 434-7264

<PAGE>   21

        To GWN:              AndroSolutions, Inc.
                             200 Fort Sanders West Blvd., Suite 309
                             Knoxville, TN 37922
                             Attention:  Gary W. Neal, M.D., President
                             Facsimile: (865) 531-6550

        With a copy to:      Zoltick Technology Law Group, PLLC
                             Loudoun Tech Center
                             21515 Ridgetop Circle, Suite 200
                             Sterling, VA 20166
                             Attention:  Martin M. Zoltick, Esq.
                             Facsimile: (571) 434-7264

               16.5. Force Majeure. Neither party shall lose any rights
        hereunder or be liable to the other party for damages or losses (except
        for payment obligations) on account of failure of performance if such
        failure is occasioned by war, strike, fire, Act of God, earthquake,
        flood, lockout, embargo, governmental acts or orders or restrictions,
        failure of suppliers, or any other reason where failure to perform is
        beyond the reasonable control and not caused by the negligence,
        intentional conduct or misconduct of the nonperforming party and such
        party has exerted all reasonable efforts to avoid or remedy such force
        majeure; provided, however, that in no event shall a party be required
        to settle any labor dispute or disturbance.

               16.6. Advice of Counsel. VI, ASIVI, ASI, and GWN have each
        consulted counsel of their choice regarding this Settlement Agreement,
        and each acknowledges and agrees that this Settlement Agreement shall
        not be deemed to have been drafted by one party or another and will be
        construed accordingly.

               16.7. Compliance with Laws. Each party shall furnish to the other
        party any information requested or required by that party during the
        term of this Settlement Agreement or any extensions hereof to enable
        that party to comply with the requirements of any U.S. or foreign, state
        and/or government agency.

               16.8. Severability; Waiver. If any provision(s) of this
        Settlement Agreement are determined to be invalid or unenforceable by a
        court of competent jurisdiction, the remainder of the Settlement
        Agreement shall remain in full force and effect without said provision.
        The parties shall in good faith negotiate a substitute clause for any
        provision declared invalid or unenforceable, which shall most nearly
        approximate the intent of the parties in entering this Settlement
        Agreement. The failure of a party to enforce any provision of the
        Settlement Agreement shall not be construed to be a waiver of the right
        of such party to thereafter enforce that provision or any other
        provision or right.

<PAGE>   22

               16.9. Entire Agreement; Modification. This Settlement Agreement
        sets forth the entire agreement and understanding of the parties with
        respect to the subject matter hereof, and supersedes all prior
        discussions, agreements and writings in relation thereto, except that
        the Operating Agreement, and the Manufacture and Supply Agreement, as
        modified herein, remain in effect. This Settlement Agreement may not be
        altered, amended or modified in any way except by a writing signed by
        both parties.

               16.10. Counterparts. This Settlement Agreement may be executed in
        two counterparts, each of which shall be deemed an original and which
        together shall constitute one instrument.

<PAGE>   23

        IN WITNESS WHEREOF, ASIVI, VI, ASI, and GWN have caused this Settlement
Agreement to be executed by their respective duly authorized representatives as
of the date first written above.

<TABLE>
<S>                                                <C>
        ASIVI, LLC                                 VIVUS, INC.

        By:    /s/ Gary W. Neal                    By:    /s/ Leland Wilson
           ------------------------------------       ------------------------------------
             AndroSolutions, Inc.                        Leland F. Wilson
             Managing Member                             President/Chief Executive Officer
             Gary W. Neal, M.D., President

        Date:     July 10, 2001                    Date:   July 12, 2001
           ------------------------------------       ------------------------------------

                                                   ANDROSOLUTIONS, INC.

        By:  /s/ Leland Wilson                     By:  /s/ Gary W. Neal
           ------------------------------------       ------------------------------------
              VIVUS, Inc.                                Gary W. Neal, M.D.
               Managing Member                            President
               Leland F. Wilson
               President/Chief Executive Office

        Date:     July 12, 2001                    Date:     July 10, 2001
           ------------------------------------       ------------------------------------

        GARY W. NEAL, M.D.

                 /s/ Gary W. Neal
        -------------------------------------
        Gary W. Neal, M.D.
        Individually and on behalf of himself

        Date:     July 10, 2001
              ---------------------
</TABLE>

<PAGE>   24

                                    EXHIBIT 1

                        TECHNOLOGY ASSIGNMENT AGREEMENT A

                                   ASSIGNMENT

        ASIVI, LLC, a Delaware limited liability company, with offices at 1172
Castro Street, Mountain View, CA 94040 (ASIVI), for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
hereby assigns, sells and transfers to VIVUS, Inc., a Delaware corporation
having offices at 1172 Castro Street, Mountain View, CA 94040, and its
successors, assigns and legal representatives, all hereinafter referred to as
the "Assignee":

        1. its entire right, title and interest in and to any and all patents
and pending patent applications relating to, inter alia, the design,
development, manufacturing, and use of products containing a prostaglandin
and/or other vasodilator for the treatment of female sexual dysfunction, as
specified on Exhibit A attached hereto (the "FSD IP");

        2. the full and complete right to file patent applications in the name
of the Assignee, its designee, or its designee's election, on the aforesaid FSD
IP, in all countries of the world;

        3. the entire right, title and interest in and to any Letters Patent
which may issue thereon in the United States or in any country, and any
renewals, revivals, reissues, reexaminations and extensions thereof, and any
patents of confirmation, registration and importation of the same; and

        4. the entire right, title and interest in all Convention and Treaty
Rights of all kinds thereon, including without limitation all rights of priority
in any country of the world, in and to the above FSD IP.

        ASIVI hereby authorizes and requests the competent authorities to grant
and to issue any and all such Letters Patent in the United States and throughout
the world to Assignee of the entire right, title and interest therein, as fully
and entirely as the same would have been held and enjoyed by ASIVI had this
assignment, sale and transfer not been made.

        ASIVI further agrees at any time to execute and to deliver upon request
of Assignee such additional documents, if any, as are necessary or desirable to
secure patent protection on said FSD IP, throughout all countries of the world,
and otherwise to do the necessary acts to give full effect to and to perfect the
rights of Assignee under this Assignment, including the execution, delivery and
procurement of any and all further documents evidencing this assignment,
transfer and sale as may be necessary or desirable.

        ASIVI hereby covenants that no assignment, sale, agreement or
encumbrance has been or will be made or entered into which would conflict with
this assignment.

<PAGE>   25

        ASIVI further covenants that it will, upon request by Assignee, provide
Assignee promptly with all pertinent facts and documents relating to said FSD IP
and said Letters Patent and legal equivalents as may be known and accessible to
ASIVI, and will testify as to the same in any interference, litigation or
proceeding related thereto and will promptly execute and deliver to Assignee or
its legal representatives any and all papers, instruments or affidavits required
to apply for, obtain, maintain, issue and enforce said application, said FSD IP
and said Letters Patent and said equivalents thereof which may be necessary or
desirable to carry out the purposes thereof.

                                            ASIVI, LLC

Date:    July 12, 2001                      By:  /s/ Leland Wilson
       -----------------                       -------------------
                                            VIVUS, Inc.
                                            Managing Member
                                            Leland F. Wilson
                                            President/Chief Executive Officer

Date:    July 10, 2001                      By:  /s/ Gary W. Neal
       -----------------                       -----------------------------
                                            AndroSolutions, Inc.
                                            Managing Member
                                            Gary W. Neal, M.D.
                                            President

<PAGE>   26

                                    EXHIBIT A

        DESCRIPTION OF PROPERTY CONTRIBUTED TO VIVUS, INC. BY ASIVI, LLC

                                      (***)

<PAGE>   27

                                    EXHIBIT 2

                        TECHNOLOGY ASSIGNMENT AGREEMENT B

                                   ASSIGNMENT

        ASIVI, LLC, a Delaware limited liability company, with offices at 1172
Castro Street, Mountain View, CA 94040 (ASIVI), for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
hereby assigns, sells and transfers to VIVUS, Inc., a Delaware corporation
having offices at 1172 Castro Street, Mountain View, CA 94040, and its
successors, assigns and legal representatives, all hereinafter referred to as
the "Assignee":

        1. its entire right, title and interest in and to any and all patents
and pending patent applications relating to, inter alia, the design,
development, manufacturing, and use of products containing a prostaglandin
and/or other vasodilator for the treatment of female sexual dysfunction, as
specified on Exhibit A attached hereto (the "FSD IP");

        2. the full and complete right to file patent applications in the name
of the Assignee, its designee, or its designee's election, on the aforesaid FSD
IP, in all countries of the world;

        3. the entire right, title and interest in and to any Letters Patent
which may issue thereon in the United States or in any country, and any
renewals, revivals, reissues, reexaminations and extensions thereof, and any
patents of confirmation, registration and importation of the same; and

        4. the entire right, title and interest in all Convention and Treaty
Rights of all kinds thereon, including without limitation all rights of priority
in any country of the world, in and to the above FSD IP.

        ASIVI hereby authorizes and requests the competent authorities to grant
and to issue any and all such Letters Patent in the United States and throughout
the world to Assignee of the entire right, title and interest therein, as fully
and entirely as the same would have been held and enjoyed by ASIVI had this
assignment, sale and transfer not been made.

        ASIVI further agrees at any time to execute and to deliver upon request
of Assignee such additional documents, if any, as are necessary or desirable to
secure patent protection on said FSD IP, throughout all countries of the world,
and otherwise to do the necessary acts to give full effect to and to perfect the
rights of Assignee under this Assignment, including the execution, delivery and
procurement of any and all further documents evidencing this assignment,
transfer and sale as may be necessary or desirable.

        ASIVI hereby covenants that no assignment, sale, agreement or
encumbrance has been or will be made or entered into which would conflict with
this assignment.

<PAGE>   28

        ASIVI further covenants that it will, upon request by Assignee, provide
Assignee promptly with all pertinent facts and documents relating to said FSD IP
and said Letters Patent and legal equivalents as may be known and accessible to
ASIVI, and will testify as to the same in any interference, litigation or
proceeding related thereto and will promptly execute and deliver to Assignee or
its legal representatives any and all papers, instruments or affidavits required
to apply for, obtain, maintain, issue and enforce said application, said FSD IP
and said Letters Patent and said equivalents thereof which may be necessary or
desirable to carry out the purposes thereof.

                                            ASIVI, LLC

Date:    July 12, 2001                      By:  /s/ Leland Wilson
       -----------------                       -------------------
                                            VIVUS, Inc.
                                            Managing Member
                                            Leland F. Wilson
                                            President/Chief Executive Officer

Date:    July 10, 2001                      By:  /s/ Gary W. Neal
       -----------------                       -----------------------------
                                            AndroSolutions, Inc.
                                            Managing Member
                                            Gary W. Neal, M.D.
                                            President

<PAGE>   29

                                    EXHIBIT A

        DESCRIPTION OF PROPERTY CONTRIBUTED TO VIVUS, INC. BY ASIVI, LLC

                                      (***)

<PAGE>   30

                                    EXHIBIT 3

                        TECHNOLOGY ASSIGNMENT AGREEMENT C

                                   ASSIGNMENT

        AndroSolutions, Inc., a Tennessee corporation with a principal place of
business at Suite 309, 200 Fort Sanders West Blvd., Knoxville, TN 37922
(collectively with its Affiliates, "ASI"), for good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, hereby assigns,
sells and transfers to VIVUS, Inc., a Delaware corporation having offices at
1172 Castro Street, Mountain View, CA 94040, and its successors, assigns and
legal representatives, all hereinafter referred to as the "Assignee":

        1. its entire right, title and interest in and to any and all patents
and pending patent applications relating to, inter alia, the treatment of female
sexual dysfunction, as specified on Exhibit A --------- attached hereto (the "
Supplemental FSD IP");

        2. the full and complete right to file patent applications in the name
of the Assignee, its designee, or its designee's election, on the aforesaid
SUPPLEMENTAL FSD IP, in all countries of the world;

        3. the entire right, title and interest in and to any Letters Patent
which may issue thereon in the United States or in any country, and any
renewals, revivals, reissues, reexaminations and extensions thereof, and any
patents of confirmation, registration and importation of the same; and

        4. the entire right, title and interest in all Convention and Treaty
Rights of all kinds thereon, including without limitation all rights of priority
in any country of the world, in and to the above SUPPLEMENTAL FSD IP.

        ASI hereby authorizes and requests the competent authorities to grant
and to issue any and all such Letters Patent in the United States and throughout
the world to Assignee of the entire right, title and interest therein, as fully
and entirely as the same would have been held and enjoyed by ASI had this
assignment, sale and transfer not been made.

        ASI further agrees at any time to execute and to deliver upon request of
Assignee such additional documents, if any, as are necessary or desirable to
secure patent protection on said SUPPLEMENTAL FSD IP, throughout all countries
of the world, and otherwise to do the necessary acts to give full effect to and
to perfect the rights of Assignee under this Assignment, including the
execution, delivery and procurement of any and all further documents evidencing
this assignment, transfer and sale as may be necessary or desirable.

<PAGE>   31

        ASI hereby covenants that no assignment, sale, agreement or encumbrance
has been or will be made or entered into which would conflict with this
assignment.

        ASI further covenants that it will, upon request by Assignee, provide
Assignee promptly with all pertinent facts and documents relating to said
SUPPLEMENTAL FSD IP and said Letters Patent and legal equivalents as may be
known and accessible to ASI, and will testify as to the same in any
interference, litigation or proceeding related thereto and will promptly execute
and deliver to Assignee or its legal representatives any and all papers,
instruments or affidavits required to apply for, obtain, maintain, issue and
enforce said application, said SUPPLEMENTAL FSD IP and said Letters Patent and
said equivalents thereof which may be necessary or desirable to carry out the
purposes thereof.

                                            ANDROSOLUTIONS, INC.

Date:    July 10, 2001                      By:  /s/ Gary W. Neal
       -----------------                       -----------------------------
                                            Gary W. Neal, M.D.
                                            President
<PAGE>   32

                                    EXHIBIT A

               DESCRIPTION OF PROPERTY CONTRIBUTED TO VIVUS, INC.

                             BY ANDROSOLUTIONS, INC.

                                      (***)

<PAGE>   33

                                    EXHIBIT 4

               SHORT FORM PROVIDING NOTICE OF COVENANT NOT TO SUE
                         AND STATEMENT OF NON-LIABILITY

        "All subject matter claimed within this patent or patent application is
subject to the following covenant not to sue and statement of non-liability:

        THE HOLDER OF ANY RIGHTS UNDER THIS PATENT OR PATENT APPLICATION SHALL
NOT MAKE, OR THREATEN TO MAKE, ANY CLAIM AGAINST VIVUS, INC. ("VI"), ITS
AFFILIATES OR LICENSEES ALLEGING INFRINGEMENT BASED UPON VI'S, ITS AFFILIATES'
OR ITS LICENSEES' MAKING, HAVING MADE, IMPORTING, HAVING IMPORTED, EXPORTING,
HAVING EXPORTED, DISTRIBUTING, HAVING DISTRIBUTED, SELLING, HAVING SOLD, USING,
OR OFFERING FOR SALE PRODUCTS RELATING TO THE DIAGNOSIS, PROPHYLAXIS, AND/OR
TREATMENT OF FEMALE SEXUAL DYSFUNCTION, INCLUDING WITHOUT LIMITATION ENHANCING
FEMALE SEXUAL DESIRE AND RESPONSIVENESS, AND PREVENTING, TREATING AND/OR
MANAGING FEMALE SEXUAL AROUSAL DISORDER, ORGASMIC DISORDER, AND PAIN DISORDER.

        FURTHER, VI, ITS AFFILIATES OR LICENSEES CANNOT BE HELD LIABLE FOR
INFRINGEMENT OF ANY RIGHTS UNDER THIS PATENT OR PATENT APPLICATION RELATING TO
THE DIAGNOSIS, PROPHYLAXIS, AND/OR TREATMENT OF FEMALE SEXUAL DYSFUNCTION,
INCLUDING WITHOUT LIMITATION ENHANCING FEMALE SEXUAL DESIRE AND RESPONSIVENESS,
AND PREVENTING, TREATING AND/OR MANAGING FEMALE SEXUAL AROUSAL DISORDER,
ORGASMIC DISORDER, AND PAIN DISORDER.

        THIS COVENANT NOT TO SUE AND STATEMENT OF NON-LIABILITY IS INTENDED TO
AND SHALL BIND ALL PRESENT AND FUTURE SUCCESSORS, HEIRS, ASSIGNS, AND LICENSEES
OF ANY RIGHTS UNDER THIS PATENT OR PATENT APPLICATION RELATING TO PRODUCTS FOR
THE DIAGNOSIS, PROPHYLAXIS, AND/OR TREATMENT OF FEMALE SEXUAL DYSFUNCTION,
INCLUDING WITHOUT LIMITATION ENHANCING FEMALE SEXUAL DESIRE AND RESPONSIVENESS,
AND PREVENTING, TREATING AND/OR MANAGING FEMALE SEXUAL AROUSAL DISORDER,
ORGASMIC DISORDER, AND PAIN DISORDER.

        A HOLDER OF ANY RIGHTS UNDER THIS PATENT OR PATENT APPLICATION MUST
PROVIDE NOTICE OF THE ABOVE-STATED COVENANTS AND STATEMENT OF NON-LIABILITY TO
ANY THIRD PARTY ACQUIRING RIGHTS UNDER THIS PATENT OR PATENT APPLICATION."

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