Document:

exhibit.htm

    
      Exhibit 10.1

       

      LICENSE AND COLLABORATION
AGREEMENT

       

      THIS
LICENSE AND COLLABORATION AGREEMENT (the “Agreement”) is made
as of the 27th day of
August, 2008 (the “Execution Date”) by
and between Valeant Pharmaceuticals North America, a Delaware corporation having
a place of business at One Enterprise, Aliso Viejo, California 92656 (“VALEANT”) and Glaxo
Group Limited, a company organized under the laws of England and Wales with its
principal place of business at GlaxoWellcome House, Berkeley Avenue, Greenford,
Middlesex, UB6 0NN, United Kingdom (“GSK”).

       

      RECITALS

       

      A.           WHEREAS,
VALEANT is the owner of Compound (as defined below) and Additional Compounds (as
defined below), and of certain regulatory filings and intellectual property
related thereto;

       

      B.           WHEREAS,
GSK desires to collaborate with VALEANT on the development and commercialization
of Compound in the Collaboration Territory (as hereinafter defined) as set forth
in this Agreement; 

       

      C.           WHEREAS,
GSK further desires to exclusively develop and commercialize Compound in the GSK
Territory (as defined below) and Additional Compounds in the Territory, as set
forth in this Agreement;

       

      D.           WHEREAS,
VALEANT desires to collaborate with GSK on the development and commercialization
of Compound in the Collaboration Territory as set forth in this Agreement;
and

       

      E.           WHEREAS,
VALEANT further desires that GSK exclusively develop and commercialize Compound
in the GSK Territory and Additional Compounds in the Territory, as set forth in
this Agreement.

       

      NOW,
THEREFORE, in consideration of the mutual agreements contained herein and other
good and valuable consideration, the sufficiency of which is hereby
acknowledged, the Parties agree as follows:

       

      I.  LICENSE

       

      1.1           License Grant from
VALEANT.  Subject to the terms and conditions of this
Agreement, VALEANT hereby grants GSK an exclusive license, with the right to
grant sublicenses as provided in Section 1.3, under all Valeant Intellectual
Property, Program Improvements Controlled by VALEANT or its Affiliates and
Agreement Patents Controlled by VALEANT or its Affiliates, to make, use, sell,
offer for sale and import Compound, Product, Additional Compounds and Additional
Products in the Field and in the Territory (the “License”).  The
License set forth in this Section 1.1 shall be exclusive even as to
VALEANT, except with respect to VALEANT’s right under the Valeant Intellectual
Property, Program Improvements 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      Controlled
by VALEANT or its Affiliates and Agreement Patents Controlled by VALEANT or its
Affiliates to:  (i) make Compound, Product, Additional Compounds and
Additional Product in the Field and in the Territory solely in accordance with
Article XIII; (ii) use Compound and Product in the Field and in the
Collaboration Territory solely in accordance with Section 3.2 ,and (iii) subject
to Section 14.4.1(a)(iii), co-commercialize Product with GSK in the Field and in
the Collaboration Territory solely in accordance with Section 3.4.

       

      1.2           License Grant from
GSK.  Subject to the terms and conditions of this Agreement,
GSK hereby grants to VALEANT a non-exclusive, royalty free right and license,
with the right to grant sublicenses only upon the prior written consent of GSK,
under all Program Improvements Controlled by GSK or its Affiliates and Agreement
Patents Controlled by GSK or its Affiliates to (i) use Compound and Product in
the Field and in the Collaboration Territory solely as provided in Section 3.2,
(ii) make Compound, Product, Additional Compounds and Additional Products in the
Field and in the Territory solely in accordance with Article XIII, and (iii)
subject to Section 14.4.1(a)(iii), co-commercialize Product with GSK in the
Field and in the Collaboration Territory solely in accordance with Section
3.4.

       

      1.3           Sublicensing.  GSK
will have the right to sublicense its rights under the License (or, if
applicable, under a Valeant Trademark) on a country-by-country and
Product-by-Product (and, if applicable, Additional Product-by-Additional
Product) basis (and Compound-by-Compound and Additional Compound-by-Additional
Compound basis as provided in clause (vi) below) in the Territory (i) to its
Affiliates, (ii) to a Third Party in a particular country in the GSK Territory
to promote and distribute the Product and Additional Products if neither GSK nor
any of its Affiliates have adequate direct sales or distribution operations in
such country,  (iii) to Third Parties as provided in Section 6.2 in
connection with the settlement of any Protective Action; (iv) to Third Parties
to permit such Third Parties to distribute and sell a generic version of Product
(or, if applicable, Additional Product) in a country after Regulatory Approval
of a Generic Equivalent of such Product in such country; (v) to Third Parties to
permit such Third Parties to provide contract research organization (CRO)
services or fee-for-service research and development services to and on behalf
of GSK or its Affiliates; and (vi) to Third Parties to permit such Third Parties
to provide manufacturing services to and on behalf of GSK or its Affiliates with
respect to Compound or Product (or, if applicable, Additional Compound or
Additional Product), provided that any
such Third Party manufacturers provide such manufacturing services at a cost
that does not *** for such Product (or, if applicable, such Additional Product)
and the *** as provided in Section *** for such Product (or, if applicable,
such Additional Product) to an amount that is *** than *** for such Product (or,
if applicable, Additional Product) in the Territory, in each case of the
foregoing clauses (i) through (vi), without the prior consent of VALEANT; provided that (x) the
terms of any sublicense permitted under the foregoing clauses (i), (ii) and (vi)
are consistent with the terms of this Agreement, (y) GSK remains liable to
VALEANT for the acts or omissions of any such sublicensee and remains
responsible for its own obligations under this Agreement, and (z) any such
sublicense automatically terminates upon any termination of the
License.  GSK will provide the Joint Steering Committee with notice of
any sublicense granted under the foregoing clause (vi).

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      Except
as otherwise provided in this Section 1.3, GSK may sublicense its rights
under the License in any country in the Territory only upon the approval of
VALEANT, which approval shall not be unreasonably withheld or
delayed.

       

      1.4           Trademarks.  For
all Trademarks Controlled by VALEANT or any of its Affiliates (a “Valeant Trademark”)
that the Joint Steering Committee determines should be used on any Product
and/or Additional Product in a country(ies) in the Territory, VALEANT shall
grant to GSK a license, with the right to sublicense as provided in Section 1.3,
in accordance with the terms of the Trademark License Agreement, to use the
Valeant Trademark(s) in such country(ies) in the Territory in connection with
the making, having made, use, sale, offering for sale, importation, packaging,
distributing and promoting of the Product and/or Additional Product in the Field
and in such country(ies) the Territory.  Such license under the
Valeant Trademarks would include a right to use the Valeant Trademark(s) other
than Valeant House Marks as part of a domain name.  For all Trademarks
Controlled by GSK or any of its Affiliates (a “GSK Trademark”) that
the Joint Steering Committee determines should be used on any Product and/or
Additional Product in a country(ies) in the Territory, GSK shall grant to
VALEANT a license in accordance with the terms of the Trademark License
Agreement, to use the GSK Trademark(s) solely in connection with VALEANT’s right
to (i) use Compound and Product in the Field and in the Collaboration Territory
as provided in Section 3.2, (ii) make Compound, Product, Additional Compounds
and Additional Products in the Field and in the Territory in accordance with
Article XIII, and (iii) subject to Section 14.4.1(a)(iii), co-commercialize
Product with GSK in the Field and in the Collaboration Territory in accordance
with Section 3.4.  Such license under the GSK Trademarks would include
a right to use the GSK Trademark(s) other than GSK House Marks as part of a
domain name.

       

      II.  CONSIDERATION

       

      As
partial consideration for the License granted to GSK in this Agreement, GSK
shall pay to VALEANT the following amounts by wire transfer in immediately
available funds to an account designated by VALEANT:

       

      2.1           License
Fee.  Subject to Section 2.4 with respect to payment of taxes,
in addition to (and not in lieu of) royalty and milestone payments due under
this Agreement, GSK will make a one time payment in an aggregate amount of
one-hundred twenty-five million United States dollars (US $125,000,000) to
VALEANT representing a license fee within five (5) business days after receipt
of an invoice therefore from VALEANT as provided in Section 2.3.6, which invoice
shall not be sent by VALEANT to GSK prior to the Effective Date.

       

      2.2           Milestone
Payments.  Subject to Section 2.3.5(a)(ii) with respect to
crediting payments made by GSK during the Pre-Launch Period and Section 2.4 with
respect to payment of taxes, in addition to (and not in lieu of) the license fee
set forth in Section 2.1 and the royalty payments set forth in Section 2.3, GSK
will pay to VALEANT each of the following milestone payments for achievement of
the corresponding milestone event no later than fifteen (15) business days
following the receipt of an invoice therefore from VALEANT as provided in

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      Section
2.3.6.  GSK shall notify VALEANT in writing promptly, but in no event
later than fifteen (15) business days with respect to Sections 2.2.1, 2.2.2
and 2.2.3, and in no event later than thirty (30) business days with respect to
Section 2.2.4, in each case, after the achievement of any of the following
milestone events, and no invoice for payment of a milestone shall be sent by
VALEANT to GSK as provided herein prior to VALEANT’s reasonable determination
that the corresponding milestone event has been achieved.

       

      2.2.1                      Milestones
for Epilepsy Indications for the Product in the Territory:

       

      (a)           Upon
Launch of the first Product for refractory partial onset seizures in the United
States, ***;

       

      (b)           Upon
Launch and receipt by GSK of reimbursement and pricing approval of the first
Product for refractory partial onset seizures in a Major EU Country,
***;

       

      (c)           Upon
GSK’s receipt of Regulatory Approval in the United States for a second Product
for any Epilepsy Indication, ***;

       

      (d)           Upon
GSK’s receipt of the first Regulatory Approval in the United States for the
first Product indicated for primary generalized tonic clonic seizures, ***;
and

       

      (e)           Upon
GSK’s receipt of Regulatory Approval for Product in the United States for any
monotherapy indication for any Epilepsy Indication, ***.

       

      For
clarity, each milestone payment identified in this Section 2.2.1 will be due
only for the first Product for an Epilepsy Indication that achieves the
applicable milestone event that corresponds to such milestone payment,
regardless of how many times the milestone event is achieved by any Product, and
no milestone payment will be paid for a Product  that does not achieve
the corresponding milestone event.  Further, in the event that the
milestone payment in Section 2.2.1(a) is paid by GSK for achievement of the
corresponding milestone event by a Modified Release Product, VALEANT shall not
be entitled to receive, and GSK shall not be obligated to pay, the milestone in
set forth in Section 2.2.1(c) upon the achievement of the corresponding
milestone event by Product.

       

      2.2.2                      Milestones
for Non-Epilepsy Indications for the Product in the Territory:

       

      (a)           Upon
Positive Proof of Concept of a Product for a Non-Epilepsy Indication,
***;

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (b)           Upon
the first administration or first dosing in the first Phase III Clinical Study
for Product in the Territory for a Non-Epilepsy Indication, ***;

       

      (c)           Upon
Acceptance of First Filing of an MAA for the first Product for a Non-Epilepsy
Indication in the United States or European Union, whichever occurs first, ***;
and

       

      (d)           Upon
the first to occur of:  (i) Launch of the first Product for a
Non-Epilepsy Indication in the United States or (ii) Launch and receipt by GSK
of pricing and reimbursement approval of the first Product for a Non-Epilepsy
Indication in a Major EU Country, ***.

       

      For
clarity, each milestone payment identified in this Section 2.2.2 will be paid
with respect to the achievement of each such milestone by a Product for not more
than three (3) Non-Epilepsy Indications, provided that such
Product has achieved the applicable milestone event that corresponds to such
milestone, and provided further that, each
Non-Epilepsy Indication is different and distinct from the other, as determined
by the Joint Steering Committee, and the Joint Steering Committee, upon approval
of a Development Plan that includes such Non-Epilepsy Indication, has reasonably
determined that ***; provided, however, that if the Joint Steering
Committee is unable to determine *** and the Senior Executives are unable
to resolve such matter within thirty (30) days after the date of an Escalation
Notice pertaining to such matter, notwithstanding anything to the contrary in
Section 3.1.7(a) or (b), the Parties shall refer such matter to a Third Party
expert reasonably acceptable to VALEANT and GSK, the costs related to such
referral shall be borne equally by the Parties, and the determination of such
expert shall be final and binding upon both Parties, and provided, further, that the
Major Additional Indication ***.  No milestone payment will be paid
for Product that does not achieve the corresponding milestone
event.  Further:

       

      (i)           the
term “Positive Proof of Concept”, as used in Section 2.2.2(a) above, means
achievement of positive results (including, for example, in a Phase II
Clinical Study), as determined by the Joint Steering Committee, that support the
efficacy of Product for a Non-Epilepsy Indication and notwithstanding the
foregoing, a Product for a Non-Epilepsy Indication will be deemed to have
achieved the milestone event in Section 2.2.2(a) upon the enrollment of the
first patient in a Phase III Clinical Study for Product for such Non-Epilepsy
Indication;

       

      (ii)           after
the Effective Date, the Joint Steering Committee will reasonably determine
whether the study design for the *** is appropriate to yield results that
if positive would 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      constitute
Positive Proof of Concept for a ***, and if not, what additional study would be
appropriate to yield such results that would constitute such Positive Proof of
Concept; provided that, in the
event that the Joint Steering Committee is unable to determine whether the
design of the ***, if yielding positive results, is appropriate to determine a
Positive Proof of Concept and the Senior Executives are unable to resolve such
matter within thirty (30) days after the date of an Escalation Notice pertaining
to such matter, notwithstanding anything to the contrary in Section 3.1.7(a) or
(b), the Parties shall refer such matter to a Third Party expert reasonably
acceptable to VALEANT and GSK, the costs related to such referral shall be borne
equally by the Parties, and the determination of such expert shall be final and
binding upon both Parties.  For clarity, a determination regarding
whether such *** has achieved positive results to constitute Positive Proof
of Concept would be determined in accordance with clause (i) above;

       

      (iii)           the
term “Acceptance of the First Filing of an MAA”, as used in Section 2.2.2(c),
means the date of GSK’s receipt of written notice of acceptance from the FDA in
the United States, or other relevant Regulatory Authority outside of the United
States, of the first MAA for substantive review.  Validation of an MAA
by the EMEA shall be deemed to constitute acceptance of the first MAA for
substantive review in the European Union; and

       

      (iv)           the
term “Major Additional Indication” means ***.

       

      2.2.3                      Milestones
for the first Additional Product in the Field and in the Territory:

       

      (a)           Upon
filing the first IND for the first Additional Product in the Field and in the
Territory, ***;

       

      (b)           Upon
the first administration or dosing of the first subject in the first Phase II
Clinical Study for the first Additional Product in the Field and in the
Territory, ***;

       

      (c)           Upon
the first administration or dosing of the first subject in the first Phase III
Clinical Study for the first Additional Product in the Field and in the
Territory, ***;

       

      (d)           Upon
Acceptance of the First Filing of an MAA for the first Additional Product in the
Field and in the United States or the European Union, whichever occurs first,
***; and

       

      (e)           Upon
Launch of the first Additional Product in the Field in the United States, ***;
and

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (f)           Upon
Launch and receipt by GSK pricing and reimbursement approval of the first
Additional Product in the Field in a Major EU Country, ***.

       

      For
clarity, each milestone payment identified in this Section 2.2.3 will be due
only for the first Additional Product in the Field and in the Territory that
achieves the applicable milestone event that corresponds to such milestone
payment, regardless of how many times the milestone event is achieved by an
Additional Product, and no milestone payment will be paid for an Additional
Product that does not achieve the corresponding milestone
event.  Further, the term “Acceptance of the First Filing of an MAA”,
as used in Section 2.2.3(d), means the date of GSK’s receipt of written notice
of acceptance from the FDA in the United States, or other relevant Regulatory
Authority outside of the United States, of the first MAA for substantive
review.  Validation of an MAA by the EMEA shall be deemed to
constitute acceptance of the first MAA for substantive review in the European
Union.

       

      2.2.4                      Sales
Milestones:

       

      (a)           Upon
the first achievement in four consecutive Quarters of ***, ***;

       

      (b)           Upon
the first achievement in four consecutive Quarters of ***, ***; and

       

      (c)           Upon
the first achievement in four consecutive Quarters of ***, ***.

       

      For
clarity, the milestone payments identified in this Section 2.2.4 will be payable
only one time each, regardless of how many times the milestone event is achieved
by any Product, and no milestone payment will be paid in the event that the
corresponding milestone event is not achieved.  Further, the milestone
payments identified in this Section 2.2.4 will not be payable for any Additional
Products that achieve the corresponding milestone event.

       

      2.3           Net Profit Share and
Royalties.  Subject to Section 2.4, in addition to (and not in
lieu of) the license fee set forth in Section 2.1 and the milestone payments set
forth in Section 2.2, GSK shall pay to VALEANT the following:

       

      2.3.1                 Net Profit Share in the
Collaboration Territory.  As partial consideration of the
licenses granted to GSK hereunder, and as consideration for the license to
Valeant Know-How granted to GSK hereunder, GSK shall pay to VALEANT amounts
equal to the applicable percentages of aggregate Net Profits of Product sold in
the Collaboration Territory, determined on a country-by-country and
Product-by-Product basis, as described in 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      Section
2.3.1(a) and (b) below, commencing on the date of Launch of a Product in a
country until ***:

       

      (a)           for
sales of the Immediate Release Formulation in the Collaboration
Territory, *** of Net Profits in each country in the Collaboration
Territory for such Immediate Release Formulation;

       

      (b)           for
sales of Modified Release Product in the Collaboration Territory, (i) *** of Net Profits in each country in the Collaboration
Territory of Modified Release Product in the *** immediately following the Launch of the
Modified Release Product, and (ii) *** of the Net Profits in each country in the Collaboration
Territory of Modified Release Product thereafter; provided, however, that *** set forth in the foregoing clauses (i)
and (ii) results in an *** in the amounts paid under this Section
2.3(b) by GSK to VALEANT for the first full
year such *** is in
effect as compared to the immediately preceding year, then GSK shall instead
***, and to the extent such
***, GSK shall be entitled
to ***; and further provided that (x) if the aggregate Net Sales of the
Modified Release Product in the Collaboration Territory
reaches *** in a
calendar year, GSK will pay to VALEANT *** and (y) if the aggregate Net Sales of
the Modified Release Product in the Collaboration Territory
reach *** in a
calendar year, GSK will pay to VALEANT ***; and

       

      (c)           with respect to Sections 2.3.1(a) and
(b) above, any net loss or
negative Net Profit with respect to the Immediate Release Product or Modified Release Product in any Quarter will be credited and carried over to any subsequent
Quarter by GSK.

       

      Following the expiration of GSK’s
obligation to share Net Profits with VALEANT in a country in the Collaboration
Territory for a Product as provided in this Section 2.3.1, GSK shall have a
perpetual, exclusive, fully paid-up right under the Valeant Intellectual
Property, Program Improvements and Agreement Patents in such country to make,
use, sell, offer for sale and import such Product in such
country.

       

      2.3.2                      Royalties on Products in the
GSK Territory and Additional Products in the Territory.  As
partial consideration of the licenses granted to GSK hereunder, and as
consideration for the license to Valeant Know-How granted to GSK hereunder, GSK
shall pay to 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      VALEANT
amounts equal to the applicable percentages of aggregate Net Sales of Products
sold in the GSK Territory and Additional Products sold in the Territory as
described below, determined on a Product-by-Product (or, as applicable,
Additional-Product-by-Additional-Product) and country-by-country basis as
follows:  

       

      (a)           ***;

       

      (i)           for
sales of Product in countries in the GSK Territory in which a royalty is owed as
provided in clause (a) above, *** of the *** in aggregate Net Sales of
Product in such countries in a calendar year and *** of all aggregate Net
Sales of Product in such countries in a calendar year in excess of ***;
and

       

      (ii)           for
sales of Additional Product in countries in the Territory in which a royalty is
owed as proved in clause (a) above, *** of the first *** in aggregate
Net Sales in such countries in a calendar year of Additional Product,
and *** of aggregate Net Sales in such countries in a calendar year of
Additional Product greater than *** and up to ***, and *** of
aggregate Net Sales of Additional Product in excess of ***;

       

      provided, however, that if the *** of GSK’s
*** for Product (or, as applicable, Additional Product) and the applicable
royalty rate as set forth in clause (a) above is ever *** of aggregate Net
Sales in a country in the Territory in any given calendar year, GSK may, for
such calendar year, immediately decrease the royalty rates set forth in clause
(a) above for Product (or, if applicable, Additional Product) in such country by
*** that the *** of GSK’s *** for Product (or, as applicable, Additional
Product) and the applicable royalty rate as set forth clause (a) above
is *** of aggregate Net Sales in such calendar year, provided, however, in no event will the royalty
payable to VALEANT as set forth in clause (a) above be *** as a result of
such adjustment.

       

      (b)           On
a Product-by-Product (or, as applicable,
Additional-Product-by-Additional-Product) and country-by-country basis,
beginning on the date that the royalties set forth in Section 2.3.2(a) cease to
be applicable to Net Sales of a Product (or, as applicable, an 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      Additional
Product) in a country pursuant to Section 2.3.2(a), GSK will pay to VALEANT
royalties at a reduced rate equal to *** of the rate which would have been
applicable in any calendar year under Section 2.3.2(a) to Net Sales of such
Product or Additional Product in such country until *** after the date the
royalties set forth in Section 2.3.2(a) cease to be applicable to Net Sales of
such Product (or, as applicable, such Additional Product) in such
country;

       

      provided, however, that if the *** of GSK’s ***
for Product (or, as applicable, Additional Product) and the applicable royalty
rate as set forth in Section 2.3.2(b) is ever *** of aggregate Net Sales in a
country in the Territory in any given calendar year, GSK may, for such calendar
year, immediately decrease the royalty rates set forth in Section 2.3.2(b) for
Product (or, if applicable, Additional Product) in such country by *** that
the *** of GSK’s *** for Product (or, as applicable, Additional Product) and the
applicable royalty rate as set forth in Section 2.3.2(b) is *** of
aggregate Net Sales in such calendar year, provided, however, in no event
will the royalty payable to VALEANT as provided in Section 2.3.2(b) be ***
as a result of such adjustment.

       

      (c)           Following
the expiration of GSK’s obligation to pay royalties as provided in this Section
2.3.2, GSK shall have a perpetual, exclusive, fully paid-up right under the
Valeant Intellectual Property and Program Improvements in such country to make,
use, sell, offer for sale and import such Product in such
country.  

       

      2.3.3                      For
purposes of this Section 2.3, a Valid Claim of a Valeant Patent or Agreement
Patent covers a Product (or, as applicable, an Additional Product) if such Valid
Claim would be infringed by the composition of matter or method of use of such
Product (or, as applicable, an Additional Product) in such country where such
Product (or, as applicable, an Additional Product) is sold but for the
License.

       

      2.3.4                      Meda.  As
between the Parties hereto,

       

      (a)           Except
as otherwise provided in Section 2.3.4(c) below, VALEANT will be solely
responsible for payment of (i) any and all royalties and other payments
(including milestone payments), if any, due pursuant to the terms of the MEDA
Agreement for any sales of Products in the GSK Territory, and (ii) any and all
royalties and other payments (including milestone payments) owed pursuant to any
amendment of the MEDA Agreement, whether or not such royalties or other payments
relate in whole or in part to Product in the Collaboration Territory, that are
in addition to or greater than royalties and payments owed with respect to
Product under the MEDA Agreement that is in effect as of the Execution
Date.  For clarity, VALEANT shall not include any payments owed under
the MEDA Agreement as described in this Section 2.3.4(a) in the Operating
Expenses set forth on Exhibit A hereto;

       

      
        
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OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (b)           VALEANT
will be solely responsible for payment of any and all royalties, if any, due
under the MEDA Agreement for any sales of Product in the Collaboration
Territory; provided, however, that VALEANT shall be entitled
to include any such payments owed under the MEDA Agreement as described in this
Section 2.3.4(b) in the Operating Expenses set forth on Exhibit A hereto;
and

       

      (c)           VALEANT
shall be solely responsible for paying all milestone payments that become
payable pursuant to Sections 3.2.2(e) and (f) of the MEDA Agreement, provided, however, that VALEANT shall be permitted
to include *** of each such milestone payment, but only to the extent that
such milestone payment has actually been paid by VALEANT pursuant to the MEDA
Agreement, in the Operating Expenses as provided in Section 2.3.4(b)
above.  For clarity, the total amount of all milestone payments
incurred and paid by VALEANT under the MEDA Agreement that are permitted to be
included in Operating Expenses by VALEANT pursuant to this Section 2.3.4(c)
shall not be more than ***.

       

      2.3.5                      Net Profit/Royalty Payment
and Reports;
Operating Expenses.

       

      (a)           For Product in the Collaboration
Territory During the Pre-Launch Period:

       

      (i)           During
the period beginning on the Effective Date and continuing until the first Launch
of the Product in the Collaboration Territory (such period, the “Pre-Launch Period”),
both Parties shall, not later than thirty (30) business days after the end of
each Quarter, provide to the other Party a written report setting forth in
reasonable detail the reporting Party’s expenditures in accordance with Section
3.2.4 on research and development and pre-commercialization activities for the
Product in the Collaboration Territory incurred in accordance with a Development
Plan and Marketing Plan, respectively, and as directed by the Joint Steering
Committee.  Subject to the terms of Section 2.3.5(a)(ii) below, to the
extent based upon such reports one Party shall have expended lesser amounts on
such research and development and pre-commercialization activities during the
immediately preceding Quarter period than the other Party, such Party having
expended more than the other Party shall submit an invoice to the other Party,
as provided in Section 2.3.6, for payment of the full amount of funds (in United
States dollars) necessary to equalize both Parties’ share of such research and
development costs and the cost of pre-commercialization activities for such
immediately preceding Quarter period and all uncontested amounts set forth in
the invoice shall be paid by the other Party not later than thirty (30) business
days after receipt of the invoice therefore.

       

      (ii)           At
such time that the Parties’ Quarterly reports pursuant to Section 2.3.5(a)(i)
indicate that the Parties’ combined cumulative aggregate expenditures in
accordance with Section 3.2.4 on research and development and
pre-commercialization activities for the Product in the Collaboration Territory
during the Pre-Launch Period has exceeded ***, GSK shall thereafter and for the
remainder of the Pre-Launch Period be solely responsible for paying any further
expenditures on 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      research
and development and pre-commercialization activities for the Product in the
Collaboration Territory during the Pre-Launch Period that are incurred in
accordance with a Development Plan and Marketing Plan, respectively, and as
directed by the Joint Steering Committee; provided, however, that GSK shall be entitled to
credit fifty percent (50%) of all amounts paid by GSK as provided in this
Section 2.3.5(a)(ii) against any payments it may owe to VALEANT under this
Agreement, including, without limitation, any milestone payments pursuant to
Section 2.2 and any royalties payments owed to VALEANT pursuant to Section
2.3.

       

      (iii)           The
Parties shall cause all invoices to be prepared and presented and amounts
payable pursuant to this Section 2.3.5 with respect to Quarters ending on or
before the effective date of the termination by GSK pursuant to Section
11.3.1(c) to be prepared, calculated and paid to the other Party, regardless of
whether any invoice or payment required thereunder is due after the effective
date of the termination by GSK.  Not later than 10 business days after
the effective date of the termination by GSK pursuant to Section 11.3.1(c), each
Party shall deliver to the other Party a written report setting forth in
reasonable detail such Party's expenditures on research and development and
pre-commercialization activities for the Product incurred in the Quarter in
which the termination became effective.  To the extent based on such
report, VALEANT has expended during the portion of the Quarter in which the
termination pursuant to Section 11.3.1(c) became effective an amount less than
the amounted expended by GSK during such period, GSK shall submit an invoice to
VALEANT in an amount (in United States dollars) equal to fifty percent (50%) of
such shortfall.  To the extent based on such report, VALEANT has
expended during the portion of the Quarter in which the termination pursuant to
Section 11.3.1(c) became effective an amount greater than the amount expended by
GSK during such period, VALEANT shall submit an invoice to GSK in an amount (in
United States dollars) equal to fifty percent (50%) of such
excess.  All invoices presented pursuant to this Section 2.3.5(a)(iii)
shall be paid within thirty (30) business days of presentation.

       

      (b)           For Product in the Collaboration
Territory Following the Pre-Launch
Period:

       

      (i)           Each
Party shall, not later than thirty (30) business days after the end of each
Quarter, provide to the other Party a written report setting forth in reasonable
detail its Operating Expenses in the Collaboration Territory, incurred in
accordance with the Development Plan and Marketing Plan and as directed by the
Joint Steering Committee, for the immediately preceding
Quarter.  Within forty-five (45) business days after the end of each
Quarter (or if VALEANT has not provided its written report of Operating Expenses
to GSK in accordance with the immediately preceding sentence, fifteen (15)
business days after GSK has received such report from VALEANT), GSK shall
provide to VALEANT its calculation of the Net Sales and Net Profits for Product
in the Collaboration Territory in such immediately preceding Quarter, and a
calculation of each Party’s share of Net Profits for Product in the
Collaboration Territory for such immediately preceding Quarter.  Such
calculation by GSK will include a reconciliation to (A) equalize the Operating
Expenses of the Parties for such Quarter, (B) carry over or credit any net loss
or negative Net Profit in accordance with Section 2.3.1(c), (C) credit GSK for
any research, development and pre-commercialization payments made by

       

      
        
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OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      GSK
during the Pre-Launch Period in accordance with Section 2.3.5(a)(ii), (D)
withhold taxes as required by Section 2.4, and (E) credit GSK for *** of
any payments to Third Parties under license agreements entered into by GSK
pursuant to Section 7.2.  After receipt of GSK’s Quarterly report as
provided in this Section 2.3.5(b)(i), VALEANT shall submit an invoice to GSK, as
provided in Section 2.3.6, for payment of VALEANT’s share of Net Profits, if
any, and all uncontested amounts set forth in such invoice shall be paid by GSK
not later than fifteen (15) business days after receipt of the invoice
therefore.  

       

      (ii)           VALEANT
shall, not later than thirty (30) business days after the end of each Quarter,
provide to GSK a written report in reasonable detail regarding any operating
expenses of the type set forth on Exhibit A, if any, incurred by it outside of
the Collaboration Territory in accordance with the Marketing Plan and as
directed by the Joint Steering Committee, and submit an invoice to GSK for such
amounts in accordance with Section 2.3.6.  GSK shall, not later than
fifteen (15) business days after receipt of such invoice from VALEANT pay all
uncontested amounts set forth in such invoice.

       

      (iii)           The
Parties acknowledge and agree that any operating expenses of the type set forth
on Exhibit A incurred by a Party that are not exclusively related to the GSK
Territory or the Collaboration Territory shall be allocated *** to
Operating Expenses in the Collaboration Territory and *** to the GSK
Territory.  All Operating Expenses exclusively related to the
Collaboration Territory shall be allocated to the Collaboration
Territory.  All operating expenses of the type set forth on Exhibit A
exclusively related to the GSK Territory shall be allocated to the GSK
Territory.

       

      (c)           For Product in the GSK Territory and
Additional Product in the Territory:  Within thirty (30)
business days after the end of each Quarter, GSK shall provide to VALEANT a
written report setting forth Net Sales for Product in the GSK Territory and Net
Sales for Additional Product in the Territory in the immediately preceding
Quarter.  Such report shall set forth a calculation of royalties owed
by GSK to VALEANT pursuant to Section 2.3.2 which includes a reconciliation to
(A) credit GSK for any research, development and pre-commercialization payments
made by GSK during the Pre-Launch Period in accordance with Section
2.3.5(a)(ii), (B) withhold taxes as required by Section 2.4, and (C) credit GSK
for *** of payments to Third Parties under license agreements entered into
by GSK pursuant to Section 7.2.   After receipt of GSK’s
Quarterly report as provided in this Section 2.3.5(c), VALEANT shall submit an
invoice to GSK, as provided in Section 2.3.6, for payment of royalties owed to
VALEANT for such Quarter, if any, and all uncontested amounts set forth in such
invoice shall be paid by GSK not later than fifteen (15) business days after
receipt of the invoice therefore.  

       

      2.3.6                      All
payments made by a Party to another Party under this Agreement shall be made by
bank wire transfer in immediately available funds to an account designated in an
invoice from the Party to which such payments are due, which invoice should
include bank details, the contact name for any issue resolution and be marked
for the attention of the Alliance Manager of the Party to whom such payment is
due.  All amounts owed by GSK to VALEANT 

       

      
        
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TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      hereunder
shall be paid by an entity resident in the United Kingdom from a bank account
located in the United Kingdom.

       

      2.3.7                      Foreign
Exchange.  With respect to sales of the Product and Additional
Product invoiced in United States dollars, the Net Sales and the amounts due
hereunder will be expressed in United States dollars.  With respect to
sales of the Product and Additional Product invoiced in a currency other than
United States dollars, the Net Sales and amounts due hereunder will be reported
in United States dollars, calculated using the average exchange rates as
calculated and utilized by GSK’s group reporting system and published
accounts.  As of the Effective Date, the method utilized by GSK’s
group reporting system and published accounts uses spot exchange rates sourced
from Reuters/Bloomberg and, if the method used by GSK's group reporting system
and published accounts is changed during the Term, GSK will notify VALEANT in
writing of the revised method prior to GSK applying such method to exchange rate
calculations to be made with respect to Net Sales and amounts under this
Agreement.

       

      2.3.8                      GSK
Records.  GSK will keep, and will require any Affiliates and
sublicensees selling Product to keep, for three (3) years from the date of each
payment of royalties, complete and accurate records of Net Profits of Product in
the Collaboration Territory and Net Sales of Product in the GSK Territory and
Additional Product in the Territory in sufficient detail to allow the royalties
to be determined accurately.  VALEANT will have the right for a period
of three (3) years after receiving any Payment Report to appoint an independent
certified public accountant reasonably acceptable to GSK (the “Valeant Auditor”) to
inspect those books or records of GSK that relate to Net Profits, Net Sales and
Operating Expenses.  Upon not less than thirty (30) days’ prior
written notice from VALEANT, GSK will make such books or records and the records
of its Affiliates available (including any Net Profits or Net Sales reports
received from its sublicensees selling Products) for inspection by such Valeant
Auditor during regular business hours at such place or places where such records
are customarily kept, to verify the accuracy of the reports and
payments.  The Valeant Auditor will disclose to VALEANT only the
amount and accuracy of payments reported and actually paid or otherwise payable
under this Agreement.  The Valeant Auditor will send a copy of the
report to GSK at the same time it is sent to VALEANT.  Such
inspections may be made no more than once every twelve (12) months and during
normal business hours.  Such records for any particular calendar
Quarter shall be subject to no more than one inspection.  The Valeant
Auditor shall be obligated to execute a reasonable confidentiality agreement
prior to commencing any such inspection.  VALEANT will bear all costs
and expenses associated with an audit conducted pursuant to this Section 2.3.8,
provided, however, that if the
designated auditor discovers an underpayment of *** or more for any period
covered by the inspection between the payments GSK has made under this Agreement
and the payments actually owed to VALEANT under this Agreement, then GSK will
bear all costs and expenses associated with such audit and, for the avoidance of
doubt, such underpayment shall be considered a late payment subject to interest
pursuant to the terms of Section 14.13.  

       

      
        
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OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      2.3.9                      VALEANT
Records.  VALEANT will keep, and will require any Affiliates
and sublicensees to keep, for three (3) years from the Quarter to which they
pertain, complete and accurate records of Operating Expenses and amounts spent
on research and development costs incurred pursuant to this Agreement in
sufficient detail to allow the Net Profits to be determined
accurately.  GSK will have the right during such three (3) year period
to appoint an independent certified public accountant reasonably acceptable to
VALEANT (the “GSK
Auditor”) to inspect those books or records of VALEANT that relate to
Operating Expenses and research and development costs.  Upon not less
than thirty (30) days’ prior written notice, VALEANT shall permit such GSK
Auditor to inspect those books or records of VALEANT that relate to its
Operating Expenses for the sole purpose of verifying the amounts payable
hereunder.  The GSK Auditor will disclose to GSK only the amount and
accuracy of payments reported and actually paid or otherwise payable under this
Agreement.  The GSK Auditor will send a copy of the report to VALEANT
at the same time it is sent to GSK.  Such inspections may be made no
more than once every twelve (12) months and during normal business
hours.  Such records for any particular Quarter shall be subject to no
more than one inspection.  The GSK Auditor shall be obligated to
execute a reasonable confidentiality agreement prior to commencing any such
inspection.  Inspections conducted under this Section 2.3.9 shall
be at the expense of GSK, unless a variation or error producing an overpayment
by GSK in amounts payable exceeding *** of the amount paid for a period
covered by the inspection is established, in which case all reasonable costs
relating to the inspection for such period and any amounts overpaid by GSK that
are discovered shall be paid by VALEANT, together with interest on such overpaid
amounts at the rate set forth in Section 14.13.  GSK agrees to
treat all information learned in the course of any audit or inspection as
Confidential Information of VALEANT.

       

      2.4           Taxes.

       

      2.4.1                      GSK
will make all payments to VALEANT under this Agreement without deduction or
withholding for taxes except to the extent that any such deduction or
withholding is required by Law in effect at the time of payment.

       

      2.4.2                      Any
tax required to be withheld on amounts payable under this Agreement will
promptly be paid by GSK on behalf of VALEANT to the appropriate governmental
authority, and GSK will furnish VALEANT with proof of payment of such
tax.  Any such tax required to be withheld will be an expense of and
borne by VALEANT.

       

      2.4.3                      GSK
and VALEANT will cooperate with respect to all documentation required by any
taxing authority or reasonably requested by GSK or VALEANT to secure a reduction
in the rate of applicable withholding taxes.

       

      2.4.4                      If
GSK had a duty to withhold taxes in connection with any payment it made to
VALEANT under this Agreement but GSK failed to withhold, and such taxes were

       

      
        
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OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      assessed
against and paid by GSK, then GSK will furnish VALEANT with proof of payment of
such taxes (including any interest) and VALEANT will reimburse GSK for such
amount.

       

      III.  JOINT STEERING COMMITTEE,
PRODUCT DEVELOPMENT,

      TRADEMARKS, REGULATORY
ACTIVITIES AND COMMERCIALIZATION

       

      3.1           Joint Steering
Committee.

       

      3.1.1                      Formation.  Within
thirty (30) days following the Effective Date, VALEANT and GSK shall establish a
joint steering committee (the “Joint Steering
Committee”) to oversee, review and coordinate the activities of the
Parties under this Agreement.

       

      3.1.2                      Membership.  The
Joint Steering Committee will be composed of six (6) representatives: three (3)
representatives nominated by VALEANT and three (3) representatives nominated by
GSK, provided
that each such representative will be an employee of the respective Party
or an Affiliate of such Party with significant experience and responsibility for
oversight of the Product (or as applicable, an Additional
Product).  Each Party may also have its Alliance Manager attend Joint
Steering Committee meetings as non-voting participants.  GSK and
Valeant will each be entitled to replace its representatives on the Joint
Steering Committee in its sole discretion at any time during the Term with representatives of similar
experience and responsibility.  The Joint Steering Committee
shall chaired by a GSK representative.  With the consent of the other
Parties (such consent not to be unreasonably withheld), other employees or
consultants of GSK or VALEANT or their respective Affiliates may attend Joint
Steering Committee meetings to present information or participate in discussions
on an ad hoc basis as non-voting participants or observers.  The
Parties shall cause their respective members on the Joint Steering Committee to
act in good faith in carrying out their activities on the Joint Steering
Committee.

       

      3.1.3                      Duties of the Joint Steering
Committee.  The Joint Steering Committee will:

       

      (a)           Review
and approve on an annual basis the Development Plans and amendments and updates
to the Development Plans;

       

      (b)           Oversee
the implementation of the Development Plans by the Parties;

       

      (c)           Oversee
the preparation and filing of MAAs and the maintenance of Regulatory Approvals
for Product and Additional Product in the United States and the European
Union;

       

      (d)           Oversee
the commercialization of Products and Additional Products in the Field and in
the Territory during the Term, including (i) review and approval of the
Marketing Strategy and the Marketing Plan for the Collaboration Territory, (ii)
review of the 

       

      
        
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THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
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      Marketing
Strategy and the Marketing Plan for the GSK Territory and (iii) review of the
Marketing Strategy and the Marketing Plan with respect to Additional Products
for the Territory;

       

      (e)           Provide
a forum for the Parties to exchange information and coordinate their respective
activities as set forth in this Agreement with respect to matters pertaining to
the development, manufacture, commercialization and distribution of the Products
(and, as applicable, Additional Products) in the Field and in the Territory, and
matters pertaining to Regulatory Approvals for the Product (and, as applicable,
Additional Products) in the Territory (including, without limitation, matters
relating to the preparation and filing of any MAA in the Territory);
and

       

      (f)           Perform
such other duties as are specifically agreed to by the Parties.

       

      3.1.4                      Subcommittees.  From
time to time, the Joint Steering Committee may establish subcommittees to
oversee particular projects or activities within the scope of authority of the
Joint Steering Committee, as it deems necessary or advisable (each, a “Subcommittee”).  Each
Subcommittee shall consist of such number of representatives of each Party as
the Joint Steering determines is appropriate from time to time.  Each
Subcommittee shall meet with such frequency as the Joint Steering Committee
shall determine.  Each Subcommittee shall operate by unanimous vote in
all decisions, with each Party having one (1) vote and with at least
one (1) representative from each Party participating in such vote. If, with
respect to a matter that is subject to a Subcommittee’s decision-making
authority, the Subcommittee cannot reach unanimity, except with respect to the
Joint Patent Subcommittee, the matter shall be immediately referred to the Joint
Steering Committee, which shall resolve such matter in accordance with Section
3.1.7.

       

      3.1.5                      Joint Patent
Subcommittee.  Promptly after the first Joint Steering
Committee meeting the Parties will form a Joint Patent Subcommittee to oversee
the patent issues. The Joint Patent Subcommittee will be composed two (2)
representatives (or such other number of representatives as the Parties may
agree) from each of the Parties. The Joint Patent Subcommittee will serve as the
forum to review and discuss and receive, in the first instance, all matters
relating to Patents and Know How relating to VALEANT Intellectual Property,
Program Improvements and Agreement Patents, shall select patent counsel to file
and prosecute patent applications relating to VALEANT Intellectual Property and
Program Improvements, and will promptly report all discussions and decisions to
the Joint Steering Committee.  The Joint Patent Subcommittee shall
operate by unanimous vote in all decisions, with each Party having one (1) vote
and with at least one (1) representative from each Party participating in
such vote. If the Joint Patent Subcommittee is unable to agree on any matter
considered by the Joint Patent Subcommittee within ten (10) days after first
considering such matter, notwithstanding anything to the contrary in Section
3.1.4, such matter shall not be referred to the Joint Steering Committee but
rather the Joint Patent Subcommittee shall refer such matter to the Chief Patent
Counsel of GSK and the Chief Patent Counsel of VALEANT or their respective
designees.  If the Chief Patent Counsel of GSK and the Chief Patent
Counsel of VALEANT or their designees (the 

       

      
        
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THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
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      “Senior Patent
Executives”) cannot agree on a resolution of the matter within ten (10)
days after being referred such matter, the matter shall be referred shall be
referred to an independent patent attorney reasonably acceptable to both
Parties, the costs related to such referral shall be borne equally by the
Parties, and the determination of such expert shall be final and binding upon
the Parties; provided, however, that any disputes relating to
applications for patent term restoration or supplemental protection certificates
in any country and listing of patents (e.g., Orange Book) in the United States
that are not settled by the Senior Patent Executives shall not be referred to an
independent patent attorney as provided herein, but shall instead be referred to
the Senior Executives for resolution.  If, after referral to the
Senior Executives, notwithstanding anything to the contrary in Section 3.1.7(a),
the matter has not been resolved, the Senior Executive of GSK shall make the
final decision (which decision shall be binding on the Parties).

       

      3.1.6                      Committee
Meetings.  The Joint Steering Committee shall meet at least
once per Quarter, or more or less often as otherwise agreed to by the
Parties.  Joint Steering Committee meetings may be conducted by
telephone, video-conference or in person as agreed to by the
Parties.  Unless otherwise agreed by the Parties, all in-person
meetings for each Committee shall be held on an alternating basis between
VALEANT’s facilities and GSK’s facilities.  Each Party shall bear its
own personnel and travel costs and expenses relating to Joint Steering
Committee, Subcommittee, or Joint Patent Subcommittee meetings, and such
expenses shall not be included in Operating Expenses.

       

      3.1.7                      Decision-Making.  Decisions
of the Joint Steering Committee shall be made by unanimous vote, with each Party
having (1) vote and with at least one (1) representative from each Party
participating in any vote.  In the event that the Joint Steering
Committee fails to reach unanimous agreement with respect to a particular matter
within its authority within thirty (30) days of the date such matter was first
presented to the Joint Steering Committee, then either Party may, by written
notice to the other Party (an “Escalation Notice”),
have such matter referred to the senior management (the “Senior Executives”)
of VALEANT and GSK as follows for resolution:  (i) to the chief
executive officer of VALEANT or his/her designee and the Chairman of Research
and Development at GSK or his/her designee for issues involving the development
of Product (and, as applicable, Additional Product), patent issues relating to
the Product (and, as applicable, Additional Product), and/or any issues
pertaining to Regulatory Approvals and MAAs for the Product (and, as applicable,
Additional Products) in the Territory (including, without limitation, matters
relating to the preparation and filing of any MAA in the Territory); and (ii) to
the chief executive officer of VALEANT or his/her designee and the president of
pharmaceuticals for North America at GSK or his/her designee for all issues
other than those relating to development of or matters pertaining to Regulatory
Approvals for the Product.  The Parties’ respective Senior Executives
shall meet promptly and negotiate in good faith to resolve such
matter.  Notwithstanding the foregoing, if following the Review Period
the Joint Steering Committee fails to reach unanimous agreement with respect to
a matter involving the selling, marketing, promotion and/or commercialization of
Product in the United States and GSK reasonably believes that it is in the best
interests of the Product that such matters be resolved expeditiously, GSK,
through the Senior Vice President having direct responsibility over the
commercialization of Product in the United States, shall consult with the Chief
Executive 

       

      
        
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THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
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      Officer
of VALEANT to promptly resolve such matter, provided, however, if such
matter is not resolved by the Senior Executives in three (3) business days, the
final determination with respect to the matter shall be made by the Senior Vice
President having direct responsibility over the commercialization of Product in
the United States.

       

      (a)           Impasse Prior to the Expiration of
the Review Period.  Except as set forth in Section 2.2.2 and
this Section 3.1.7(a), if, during the period prior to the expiration of the
Review Period, despite good faith efforts, the Senior Executives are unable to
resolve such matter within thirty (30) days of the date of any Escalation
Notice, then upon the written request of either Party, the Senior Executive of
VALEANT may cast the deciding vote on such matter (which shall become the
decision of the Joint Steering Committee); provided that VALEANT
cannot make any deciding vote with respect to (i) entering into any binding
agreements relating to the manufacture or commercialization of the Products or
Additional Products in the Field and in the Territory; (ii) any material
amendments to the Development Plans or Marketing Plans, including, without
limitation, those that could reasonably be expected to have an adverse effect on
the commercial profile or viability of the Product or Additional Product or
would increase any research and development costs or commercialization costs;
and (iii) any MAA to be filed in the United States or European Union prior to
the Joint Steering Committee’s agreement as to the actions to be taken based on
the results of the studies set forth in the ***, but rather in the case of the
foregoing clauses (i), (ii) and (iii), GSK’s prior consent must be obtained; and
provided further that, any disputes with
respect to the design of the *** that are not resolved by the Joint Steering
Committee will be resolved in accordance with the procedures set forth in
Section 2.2.2(d)(ii), and any disputes relating to the *** that are not resolved
by the Joint Steering Committee will be referred to the Chief Executive Office
of Valeant and the Chairman of GSK having direct responsibility over research
and development.  If any dispute relating to the *** is not resolved
by the Chief Executive Office of VALEANT and the Chairman of GSK having direct
responsibility over research and development, the matter shall be referred
to *** whose written opinion on the matter shall be binding on the
Parties. 

       

      (b)           Impasse After the Expiration of the
Review Period.  Except as otherwise provided in Section 2.2.2,
if, during the period after the expiration of the Review Period, despite good
faith efforts, the Senior Executives are unable to resolve such matter within
thirty (30) days of the date of any Escalation Notice, then GSK may cast
the deciding vote on such matter (which shall become the decision of the Joint
Steering Committee), provided that GSK
cannot make any deciding vote with respect to (i) entering into any binding
agreements relating to the manufacture of the Products or Additional Products in
the Field and in the Territory that do not meet the criteria set forth in
Section 1.3(iii); and (ii) any material amendments to the ***, including,
without limitation, those that could reasonably be expected to have an adverse
effect on the commercial profile or viability of the Product or Additional
Product or would increase any research and development costs, but rather in the
case of the foregoing clauses (i), (ii) and (iii), VALEANT’s prior consent must
be obtained.

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (c)           Impasse on Safety
Issues.  If, prior to expiration of the Review Period, despite
good faith efforts, the Senior Executives are unable to resolve such matter
within two (2) business days of the date of any Escalation Notice, the
Party having the greatest concern or expressing the most conservative position
regarding a Safety Issue relating to Product or Additional Product shall make
the final decision.  If, after the expiration of the Review Period,
despite good faith efforts, the Senior Executives are unable to resolve such
matter within two (2) business days of the date of any Escalation Notice,
the Party having the greatest concern or expressing the most conservative
position regarding a Safety Issue relating to Product in the Collaboration
Territory shall make the final decision.  If, after the expiration of
the Review Period, despite good faith efforts, the Senior Executives are unable
to resolve such matter within two (2) business days of the date of any
Escalation Notice, GSK shall make the final decision regarding any Safety Issues
relating to Product in the GSK Territory or Additional Product in the
Territory.

       

      3.1.8                      Alliance
Managers.  Within thirty (30) days following the Effective
Date, each Party shall appoint a representative (“Alliance Manager”) to
facilitate communications between the Parties and to act as a liaison between
the Parties with respect to such matters as the Parties may mutually agree in
order to maximize the efficiency of the collaboration.  Each Alliance
Manager shall be permitted to attend meetings of the JSC as a nonvoting
observer, subject to the confidentiality provisions of Article
X.  Each Party may replace its Alliance Manager with an alternative
representative at any time with prior written notice to the other
Party.

       

      3.1.9                      Scope of
Governance.  The Joint Steering Committee will not have the
power to amend or modify this Agreement, and no decision of the Joint Steering
Committee or any Party exercising a deciding vote as provided in Section 3.1.7
shall be in contravention of any terms and conditions of this
Agreement.  It is understood and agreed that issues to be formally
decided by the Joint Steering Committee, as applicable, are only those specific
issues that are expressly provided in this Agreement to be decided by the Joint
Steering Committee.

       

      3.1.10                      Collaboration
Teams.  The Joint Steering Committee intends to establish small
collaborative project teams comprised of employees from GSK and Valeant, with
appropriate expertise and experience, to handle discrete aspects of the
development and commercialization of the Product.

       

      3.2           Product
Development.

       

      3.2.1                      Development
Plans.  An initial development plan for the *** and the 2008/09
Development Plan, both of which are attached to this Agreement as Schedule
3.2.1.  Within ninety (90) days following the Effective
Date, the Joint Steering Committee shall review and finalize the details of a 5
Year Development Plan (the ***, 2008/09 Development Plan and 5 Year Development
Plan are collectively referred to herein as the “Development
Plans”).  The Joint Steering Committee shall review the
Development Plans on an ongoing basis.

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      3.2.2                      The
Joint Steering Committee will oversee development of the Compound, Additional
Compounds, Products and Additional Products in accordance with the Development
Plans.   Subject to Sections 3.2.3 and 3.2.5, GSK shall use
Commercially Reasonable Efforts to carry out all clinical development and other
activities required to obtain Regulatory Approvals for the Products and
Additional Products in the Field and in the Territory, with the conduct and
manner of implementation of such activities determined in the reasonable
discretion of GSK consistent with the Development Plan and as directed by the
Joint Steering Committee.  Subject to Section 3.2.5, VALEANT shall use
Commercially Reasonable Efforts to carry out all clinical development and other
activities required to obtain Regulatory Approvals for the Product in the Field
and in the Territory prior to the expiration of the Review Period and in the
Collaboration Territory after expiration of the Review Period, in each case, in
accordance with the then-current Development Plans and as directed by the Joint
Steering Committee.  Subject to Sections 3.2.3 and 3.2.5, each Party
shall conduct those activities allocated to such Party under the Development
Plans in compliance in all material respects in accordance with good scientific
and clinical practices, and Laws applicable in the country in which such
activities are conducted.

       

      3.2.3                      Notwithstanding
anything to the contrary in this Agreement, the Parties acknowledge and agree
that GSK will have no obligation to develop VRX-698 or any other Additional
Compounds and if, at any time during the Term, GSK, in its sole discretion,
makes a final determination not to conduct any development activities with
respect to any Additional Products in the Territory, GSK shall promptly notify
VALEANT of such decision, GSK’s License with respect to the Additional Compounds
and Additional Products shall terminate and VALEANT may elect to enter into good
faith negotiations regarding a license agreement with GSK, pursuant to which
VALEANT would obtain a license under Program Improvements and Agreement Patents,
in each case, Controlled by GSK or its Affiliates to make, use, sell, offer for
sale and import Additional Compounds and Additional Products in the Field and in
the Territory.  If GSK has not initiated a Phase I Clinical Study with
respect to such Additional Compounds and Additional Products, ***.  If
the first dosing of a subject in a Phase II Clinical Study for an Additional
Product has occurred as of the effective date of the license agreement, the
***.  If the first dosing of a subject in a Phase III Clinical Study
for an Additional Product has occurred as of the effective date of the license
agreement, the ***.  If VALEANT determines to license rights with
respect to the Additional Product and Additional Compounds to a Third Party or
enter into a collaboration or development agreement with a Third Party, VALEANT
shall first notify GSK of the proposed terms of any such license or
agreement.  If GSK notifies VALEANT within thirty (30) business days
of receipt of such notice from VALEANT that it is willing to enter into a
license or agreement with VALEANT on terms no less favorable than the terms
offered by the Third Party, VALEANT shall enter into an agreement or license
with GSK on such terms.

       

      3.2.4                      Subject
to Section 3.2.5, VALEANT and GSK will share equally the research and
development costs incurred in accordance with the Development Plans with respect
to Products for the Collaboration Territory, and GSK will be solely responsible
for all research 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      and
development costs incurred in accordance with the Development Plans with respect
to  Products in the Territory in the GSK Territory and with respect to
Additional Products in the Territory.  The Parties acknowledge and
agree that any research and development costs incurred by a Party in accordance
with the Development Plans with respect to Products that are not exclusively
related to the GSK Territory or the Collaboration Territory shall be
allocated *** to the Collaboration Territory and *** to the GSK
Territory, and paid by the Parties as set forth in this Section
3.2.4.

       

      3.2.5                      In
the event that one Party, in its sole discretion, determines that it does not
want to participate financially in a part of a development program in the
Collaboration Territory for a Product as set forth in the Development Plans,
that Party shall provide prompt written notice of such determination and will
thereafter not bear any share of the costs or expenses associated with such part
of such development activities.  The Party not bearing such costs and
expenses shall not be entitled to receive its share of the Net Profits for such
Product as provided in Section 2.3.1(a) and (b), but rather such Party shall
only be entitled to retain or receive a royalty on the Net Sales for such
Product in the Collaboration Territory that is equal to the royalty on the Net
Sales that such Party would be entitled to retain or receive in accordance with
Section 2.3.2(a) in the event such Product was sold outside of the Collaboration
Territory.  The Party so determining not to participate in such part
of such development program may opt back in to such economic benefit prior to an
MAA being filed for such Product in any country in the Collaboration Territory
by paying to the other Party (i) *** of all of the costs and expenses incurred
by the other Party in the conduct of such development program, (ii) an
additional *** of such costs and expenses if the Party opts back in prior
to the ***, an additional *** of such costs and expenses if the Party opts
back in prior to the ***, or *** of such costs and expenses if the Party
opts back in prior to ***, and (iii) interest on all amounts due as provided in
the foregoing clauses (i) and (ii) from the date of its notice under this
Section 3.2.5 calculated in accordance with the terms of Section
14.13.  For clarity, if a Party opts back in as provided herein, such
Party will be entitled to receive its share of the Net Profits for such Product
as provided in Section 2.3.1 (a) and (b).

       

      3.3           Regulatory
Activities.

       

      3.3.1                      Prior to the Expiration of
the Review Period.  Prior to the expiration of the Review
Period, VALEANT (or its designated Affiliate) will continue to hold and maintain
all Regulatory Approvals and other filings with Regulatory Authorities for the
Products and Additional Products; provided, however, that VALEANT
shall, as directed by the Joint Steering Committee, take all reasonable actions
to make available to GSK the benefits of such Regulatory Approvals to the extent
required by GSK in connection with its activities under this
Agreement.  Further, prior to the expiration of the Review Period,
VALEANT will be responsible for filing and obtaining MAAs with the Regulatory
Authorities for the development, use and commercialization of Products and
Additional Products in the Territory, as directed by the Joint 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      Steering
Committee and using Commercially Reasonable Efforts to seek such
approvals.  All such activity shall be done in full consultation with
the Joint Steering Committee.  All such filings will be in the name of
VALEANT, except where otherwise required by applicable Law in any country within
the Territory.  With respect to any Regulatory Approval maintained by
VALEANT as provided herein or any MAA to be filed by VALEANT as provided herein,
VALEANT shall provide GSK with:

       

       

      (a)           reasonable
advanced notice (and in no event less than twenty (20) days’ advance notice
whenever feasible) of substantive meetings with the FDA, the EMEA or any other
Regulatory Authority that are either scheduled with, or initiated by or under
the authority of, VALEANT or its Affiliates relating to such Regulatory
Approvals or MAAs;

       

      (b)           an
opportunity to have up to two (2) representatives attend and to actively
participate in, all substantive meetings with the FDA, the EMEA or any other
Regulatory Authority relating to such Regulatory Approvals and MAAs; and in any
case, VALEANT shall keep the Joint Steering Committee informed as to all
material interactions with Regulatory Authorities relating to such Regulatory
Approvals and MAAs;

       

      (c)           a
copy of any material documents, information and correspondence submitted to the
FDA or the EMEA or any other Regulatory Authority relating to such Regulatory
Approvals as soon as reasonably practicable, together with English translations
and summaries thereof, to the extent such translations and summaries exist;
and

       

      (d)           at
least two (2) months prior to an anticipated filing of an MAA for a Product, a
copy of such all documents and information intended to be included in such MAA
for review and comment by GSK, which comments will be reasonably considered by
VALEANT, and, with respect to the United States, all information reasonably
requested by GSK to determine the listing of patents (i.e., in the Orange Book)
for such Product in the United States.

       

      3.3.2                      After the Expiration of the
Review Period. Promptly following the expiration of the Review Period,
VALEANT will transfer all such Regulatory Approvals and other filings with
Regulatory Authorities to GSK and GSK shall have the sole responsibility, as
directed by the Joint Steering Committee and using Commercially Reasonable
Efforts, to hold and maintain all Regulatory Approvals and other filings with
Regulatory Authorities for the Products and Additional Products in the Territory
during the Term.  Further, after the expiration of the Review Period,
GSK will be solely responsible for filing and obtaining MAAs from the Regulatory
Authorities for development, use, and commercialization of each Product and
Additional Products in the Territory as directed by the Joint Steering Committee
and using Commercially Reasonable Efforts to seek such approvals.  All
such activity shall be done in full consultation with the Joint Steering
Committee, and GSK shall reasonably consider in good faith the comments of
VALEANT.  All such filings will be in the name of GSK, except where
otherwise required by applicable Law in any country within the
Territory.  VALEANT will provide reasonable cooperation and assistance
to GSK (and file appropriate paperwork for such 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      transfer)
in the event that GSK must respond to questions from Regulatory Authorities in
the Territory concerning development activities conducted by or on behalf of
VALEANT with the Compound, Product, Additional Compound or Additional
Product.

       

      3.3.3                      Associated Cost and
Expenses.  The Parties will share equally the costs and
expenses necessary to obtain any MAA and to maintain any Regulatory Approval for
a Product in the Collaboration Territory pursuant to the terms of this
Agreement. GSK will pay or cause the payment of all costs and expenses necessary
to obtain such obtain any MAA and to maintain any Regulatory Approvals in all
countries in the GSK Territory and for any Additional Products.

       

      3.3.4                      Adverse Event
Reporting.

       

      (a)           Pharmacovigilance
Agreement.  Within forty-five (45) days after the HSR Clearance
Date, the Parties shall enter into a pharmacovigilance agreement on terms no
less stringent than those required by ICH guidelines,
including:  (i) providing detailed procedures regarding the
maintenance of core safety information and the exchange of safety data relating
to the Compound, Products, Additional Compounds and Additional Products in the Territory within appropriate
timeframes and in an appropriate format to enable each Party to meet both
expedited and periodic regulatory reporting requirements; and
(ii) ensuring compliance with the reporting requirements of all applicable
Regulatory Authorities on a worldwide basis for the reporting of safety data in
accordance with standards stipulated in the ICH guidelines, and all applicable regulatory
and legal requirements regarding the management of safety
data.

       

      (b)           Adverse Event
Reporting.  As between the Parties:  (i) VALEANT
shall be responsible for the timely reporting of all adverse drug
reactions/experiences, Product (and, if applicable, Additional Product) quality,
Product (and, if applicable, Additional Product) complaints and safety data
relating to the Compound and Products (and, if applicable, Additional Compound and
Additional Product) to the appropriate Regulatory Authorities in the Territory
prior to the expiration of the Review Period; and (ii) GSK shall be
responsible for the timely reporting of all adverse drug reactions/experiences,
Product quality, Product complaints and safety data relating to the Compound,
Products, Additional Compounds, and Additional Products after the expiration of
the Review Period; in each case of (i) and (ii) in accordance with the
applicable Laws of the relevant countries and Regulatory Authorities in the
Territory.

       

      (c)           Global Safety
Database.  As between the Parties:  VALEANT shall
maintain the global safety database with respect to the Product and Additional
Products in the Territory prior to expiration of the Review Period. GSK shall
maintain the global safety database with respect to the Product and Additional
Products in  the Territory after expiration of the Review
Period.

       

      3.4           Commercialization.

       

      3.4.1                      Commercialization
Plan.  Within ninety (90) days after the Effective Date, GSK
shall prepare the Marketing Plan, which the Parties through the Joint Steering
Committee 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      shall
review and approve.  The Marketing Plan will be reviewed and approved
on an annual basis by the Joint Steering Committee.

       

      3.4.2                      GSK
shall have sole responsibility for all activities relating to the
commercialization, distribution, marketing, sales force support and promotion of
the Products in the Field in the Collaboration Territory, Products in the Field
in the GSK Territory and Additional Products in the Field in the Territory
including, without limitation, with respect to the following:

       

      (a)           establishing
pricing and reimbursement for Products and Additional Products, but in
consultation with the Joint Steering Committee with respect to Product in the
Field in the Collaboration;

       

      (b)           managed
care contracting for Products and Additional Products, provided that
***;

       

      (c)           receiving, accepting and filling
orders for Products and Additional Products from customers;

       

      (d)           distributing Products and
Additional Products to customers;

       

      (e)           controlling invoicing, order
processing and collecting accounts receivable for sales of Products and
Additional Products; and

       

      (f)           recording sales of Products and
Additional Products in the Territory in its books of account for
sales.

       

      3.4.3                      GSK
shall use Commercially Reasonable Efforts to commercialize the Products and
Additional Products in the Territory and in the Collaboration Territory, with
the manner of implementation of such commercialization determined in the
reasonable discretion of GSK consistent with the Marketing Plan and as directed
by the Joint Steering Committee.  VALEANT shall use Commercially
Reasonable Efforts to participate in the commercialization activities in the
Collaboration Territory in a manner consistent with the Marketing Plan and as
directed by the Joint Steering Committee.  The Parties acknowledge and
agree that any commercialization costs incurred by a Party in accordance with a
Marketing Plan with respect to Products that are not exclusively related to the
GSK Territory or the Collaboration Territory shall be allocated *** to the
Collaboration Territory (to be included in Operating Expenses) and *** to
the GSK Territory (to be borne by GSK).  Subject to Section 9.2, the
Parties agree that if VALEANT acquires commercialization rights with respect to
other products with an epilepsy indication in the United States, GSK shall
provide reasonable 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      assistance
to VALEANT if VALEANT determines to establish its own sales force to
commercialize such products.

       

      3.5           Use of Trademarks and
House
Marks.  The Joint Steering Committee will determine which
Trademark or Trademarks will be used in marketing Products and Additional
Products in the Territory.  Further, all packaging, and package
inserts for the Products in the Collaboration Territory shall, along with the
GSK brand name and logo or other identifying markings of GSK or its Affiliates
(collectively, the “GSK House Marks”),
include the VALEANT brand name and logo (such VALEANT brand name and logo,
collectively “VALEANT
House Marks”) in reasonable size and prominence as allowed by applicable
Law; it being understood that the exact size, placement and prominence of such
VALEANT House Marks shall be determined by GSK in its reasonable
discretion.  VALEANT hereby grants to GSK a non-exclusive,
royalty-free license, with the right to grant sublicenses as provided in Section
1.3, to use the VALEANT House Marks in connection with the developing making,
having made, use, sale, offering for sale, importation, packaging, distributing
and promotion of the Product in the Field in the Collaboration
Territory.  Solely to the extent necessary to preserve VALEANT’s legal
rights in the VALEANT House Marks, GSK shall submit to VALEANT, not less than
fifteen (15) days prior to their proposed distribution, representative packaging
for the Product displaying the VALEANT House Marks to VALEANT for VALEANT’s
review and written approval solely with respect to GSK’s use of the VALEANT
House Marks, which approval will not be unreasonably withheld or
delayed.  If VALEANT has not responded within thirty (30) days after the submission of
such packaging for the Product, VALEANT’s approval to GSK’s use of the VALEANT
House Marks on such packaging and will be deemed to have been
received.  GSK may make any subsequent changes to packaging bearing
the VALEANT House Marks, other than changes to the VALEANT House Marks without
the subsequent approval from VALEANT.  For clarity, only GSK House
Marks will be used on Products in the GSK Territory and Additional Products in
the Territory.

       

      3.6           Product
Recalls.  At the direction of the Joint Steering Committee and
subject to Article XII, GSK will have the responsibility for, any total or
partial recall or market withdrawal of the Product in the Collaboration
Territory (whether voluntary or not), provided that the
costs associated with any recall shall be included in Operating Expenses, and
provided further that to the
extent that such total or partial recall or market withdrawal is as a result of
a Party’s (or a Party’s Third Party manufacturer’s) gross negligence or failure
to comply with the terms of this Agreement, all such costs shall be borne by
such Party.  VALEANT will cooperate with and assist GSK in effecting
such recall or market withdrawal, including making available to GSK, upon
request, all of VALEANT’s pertinent records.  All costs associated
with any total or partial recall or market withdrawal of the Product in the GSK
Territory or any Additional Product shall be borne by GSK; provided that to the
extent that such total or partial recall or market withdrawal is as a result of
a VALEANT’s (or VALEANT’s Third Party manufacturer’s) gross negligence or
failure to comply with the terms of this Agreement, all such costs shall be
borne by VALEANT.

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      3.7           Exchange of Data and
Know-How.  Promptly following the Effective  Date,
VALEANT will provide to GSK, at no cost or expense to GSK, all Valeant Know-How
that is necessary, or materially useful, for GSK to develop, manufacture and/or
commercialize the Compound, Products, Additional Compounds and Additional
Products in the
Territory, including all data from any and all clinical trials and preclinical
studies and non-clinical development work conducted prior to the Effective
Date.  During the Term, VALEANT shall provide to GSK at no cost or
expense to GSK Valeant Know-How that has not previously been provided promptly
upon request by GSK.  VALEANT shall provide all Valeant Know-How in
electronic form to the extent the same exists in electronic form, and shall
provide copies as reasonably requested and an opportunity for GSK or its
designee to inspect (and copy) all other materials comprising such Know-How
(including for example, original patient report forms and other original source
data).  The Parties will cooperate and reasonably agree upon formats
and procedures to facilitate the orderly and efficient exchange of the Valeant
Know-How during the Term.

       

      IV.  STANDSTILL

       

      4.1           Standstill

       

      4.1.1                      During
the Term, GSK will not, and will cause its Affiliates to not, directly or
indirectly, except as previously expressly requested in writing by VALEANT, (i)
acquire, offer to acquire, or agree to acquire, directly or indirectly, by
purchase or otherwise, any voting securities or direct or indirect rights to
acquire any voting securities or a substantial portion of the assets of VALEANT
or any Affiliate, (ii) except as expressly permitted in Section 4.1.2, solicit,
seek or offer to effect, or actually effect, negotiate with, or make or
participate in any statement or proposal, whether written or oral, either alone
or in concert with others, to the board of directors of VALEANT or any of its
Affiliates, to any director or officer of VALEANT or to any stockholder of
VALEANT or any of its Affiliates or make or participate in any public
announcement or proposal or offer whatsoever (including any “solicitation” of
“proxies” as such terms are defined or used in the proxy rules of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”) to
vote, or to seek to advise or influence any Person with respect to the voting of
any securities of VALEANT or any of its Affiliates) with respect to (a) any
merger, tender, or exchange offer or liquidation of VALEANT’s or any of its
Affiliates’ assets or similar transaction, (b) any form of restructuring,
recapitalization, or similar transaction with respect to VALEANT or any of its
Affiliates, (c) any purchase of any common stock or a substantial portion of
assets, or rights to acquire any securities or a substantial portion of assets,
of VALEANT or any of its Affiliates, (d) any proposal to seek representation on
the board of directors of VALEANT or otherwise to seek to control the board of
directors or the management of VALEANT or any of its Affiliates, (e) forming,
joining, or in any way participating, or directing any Person to form, join, or
in any way participate, in a “group” (within the meaning of Section 13(d)(3) of
the Exchange Act) with respect to any securities of VALEANT or any of its
Affiliates or (f) disclosing or directing any Person to disclose, any intention,
plan, or arrangement inconsistent with the foregoing, or (iii) assist or direct
any Third Party to do any of the foregoing.  For the duration of the
Term, GSK will not, and will cause its Affiliates to not, directly or
indirectly, (x) request VALEANT to amend, waive or terminate any provisions of
this 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      paragraph
(including this sentence) or (y) take any action which might require VALEANT to
make a public announcement regarding any of the matters specified in this
paragraph.

       

      4.1.2                      The
foregoing will not prohibit GSK (acting through its Chief Executive Officer)
from confidentially communicating to the Chief Executive Officer and/or Chairman
of the board of directors of VALEANT a non-public indication of GSK’s interest
in pursuing a potential transaction involving VALEANT in such a manner that
would not reasonably be expected to require VALEANT to make public disclosure
with respect thereto.  Furthermore, following and only for the
duration of such time as (a) VALEANT publicly announces that it has entered into
an agreement with a Third Party providing for the acquisition of a majority of
the outstanding shares of VALEANT or for a merger or similar business
combination that would result in VALEANT’s shareholders immediately prior to
such transaction holding, directly or indirectly, less than a majority of the
outstanding shares of the resultant entity, (b) any Third Party commences a
tender or exchange offer for at least a majority of the outstanding shares of
VALEANT, or (c) VALEANT has publicly disclosed that it is conducting a process
intended to result in the sale of VALEANT, the restrictions set forth in the
first sentence of this paragraph and in Section 4.1.1 shall not prevent GSK from
taking the actions specified therein (other than the actions described in
4.1.1(d) or 4.1.1(e)) in connection with a proposal made by GSK to all VALEANT
shareholders to acquire at least a majority of the outstanding shares of
VALEANT, whether by tender or exchange offer, merger or other business
combination transaction.

       

      4.1.3                      Notwithstanding
anything to the contrary contained herein, the prohibitions set forth in
Sections 4.1.1 and 4.1.2 shall not apply to (i) any investment in any securities
of VALEANT or any of its Affiliates by or on behalf of any independently managed
pension plan, employee benefit plan, or trust, including (a) any direct or
indirect interests in portfolio securities held by an investment company
registered under the Investment Company Act of 1940, as amended, or (b)
interests in securities comprising part of a mutual fund or broad based,
publicly traded market basket or index of stocks approved for such a plan or
trust in which such plan or trust invests; or (ii) securities of VALEANT or any
of its Affiliates held by a Person acquired by GSK or any of its representatives
for bona fide purposes other than the acquisition of securities of VALEANT (a)
on the date such Person first entered into an agreement to be acquired by GSK
(or such representative) or (b) acquired after such Person was acquired by GSK
(or such representative) pursuant to an agreement requiring (but only to the
extent requiring) such Person to acquire such securities, which agreement was in
effect on the date such Person first entered into an agreement to be acquired by
GSK (or such representative); or (iii) any assets or securities of VALEANT, as
debtor, that are acquired in a transaction subject to the approval of the United
States Bankruptcy Court pursuant to proceedings under the United States
Bankruptcy Code.

       

      4.2           Non-Solicitation of
Employees.  Except as otherwise permitted by a Party in
writing, each Party will refrain from soliciting employees of the other during
the Term, provided that the
foregoing shall not preclude a Party from hiring any employee of the other Party
who (i) initiates discussion with a Party regarding such employment without any
direct or indirect solicitation by such Party, (ii) has had his or her
employment terminated by a Party prior to 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
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      commencement
of employment discussions between the other Party and such employee or (iii)
responds to any general solicitation placed by a Party (including any
recruitment efforts conducted by any recruitment agency, provided that such
Party has not directed such recruitment efforts at such person).

       

      V.  OWNERSHIP AND INTELLECTUAL
PROPERTY

       

      5.1           Ownership and
Trademarks.  Subject to GSK’s license rights under the License,
VALEANT is and will be sole owner of Valeant Intellectual Property, Valeant
Confidential Information, VALEANT’s Trademarks owned by it as of the Effective
Date, and Valeant Know-How.  Subject to any license granted to VALEANT
pursuant to the terms of Section 1.2, GSK is and will be the sole owner of GSK
Confidential Information and GSK Trademarks.

       

      5.2           Patent Applications on
Valeant Know-How.

       

      5.2.1                      With
respect to applications for patents filed as of the Effective Date that relate
to Valeant Know-How, (a) VALEANT will remain the owner of the applications for
such patents, (b) VALEANT will bear the full costs (except to the extent such
costs relate to the Collaboration Territory in which case they may be included
in Operating Expenses) of and responsibility for preparing, filing, and
prosecuting, the applications and (c) to the extent that any claims of such
applications for patent cover the Compound, or the manufacture, use or sale
thereof, such applications for patent and any patents issuing thereon will
constitute Valeant Patents for purposes of this Agreement.  GSK shall
have the right, at its own cost and expense (except to the extent such costs and
expenses relate to the Collaboration Territory in which case they may be
included in Operating Expenses), to reasonably assist VALEANT in connection with
the filing, prosecution and maintenance of any VALEANT patents applications in
the Territory.  VALEANT shall, in a timely manner, solicit GSK’s
advice and review of the nature and text of any such patent application and
prosecution matters related thereto, including any correspondence between
VALEANT and any government Intellectual Property or Patent authorities, agencies
or other government bodies, in reasonably sufficient time prior to filing
thereof, and VALEANT shall take into reasonable account GSK’s comments related
thereto. Any disagreements hereunder, including filing, prosecution and
maintenance decisions or strategies, shall be referred to the Joint Patent
Subcommittee for resolution as provided in Section 3.1.5.

       

      5.2.2                      Where
applications for patents covering any Valeant Know-How have not been filed as of
the Effective Date:

       

      (a)           VALEANT
will remain the owner of such Valeant Know-How and will own any applications for
patent with respect thereto and any patents issued on such applications, unless
such rights are assigned to GSK pursuant to Section 5.4;

       

      (b)           VALEANT
will determine whether or not to file an application for patent in the Territory
on Valeant Know-How.  If VALEANT elects to file such an application,
VALEANT will bear the full costs (except to the extent such costs relate to the
Collaboration 

       

      
        
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OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
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      Territory
in which case they may be included in Operating Expenses) of preparing, filing,
and prosecuting the application and maintaining any patents that issue thereon
and VALEANT will control the prosecution of such application.  GSK
shall have the right, at its own cost and expense (except to the extent such
costs and expense relate to the Collaboration Territory in which case they may
be included in Operating Expenses), to reasonably assist VALEANT in connection
with the filing, prosecution and maintenance of any patents applications filed
under this Section 5.2.2.  VALEANT shall, in a timely manner, solicit
GSK’s advice and review of the nature and text of any such patent application
and prosecution matters related thereto, including any correspondence between
VALEANT and any government Intellectual Property or Patent authorities, agencies
or other government bodies, in reasonably sufficient time prior to filing
thereof, and VALEANT shall take into reasonable account GSK’s comments related
thereto.  Any disagreements hereunder, including filing, prosecution
and maintenance decisions or strategies, shall be referred to the Joint Patent
Subcommittee for resolution as provided in Section 3.1.5;

       

      (c)           if
VALEANT elects not to file an application for patent in any country in the
Territory covering any such Valeant Know-How VALEANT shall give GSK notice
thereof prior to causing in any way such Valeant Know-How to become unpatentable
through disclosure, sale, or otherwise, and GSK shall thereafter have the right,
at its sole expense, to prepare, file, prosecute and maintain such patent
application in any such country. Any disagreements hereunder shall be referred
to the Joint Patent Committee for resolution; and

       

      (d)           VALEANT
will notify the Joint Steering Committee regarding each application for patent
filed by VALEANT pursuant to this Section 5.2.2 and any patent issuing
thereon.  Each such application and each such patent will constitute a
Valeant Patent for purposes of this Agreement and (subject to any restrictions
imposed by Third Party transferors or licensors of such Valeant Know-How) will
be licensed to GSK by VALEANT as part of the License without any royalty or
other payment other than the royalties and payments specified
herein.

       

      5.3           Program
Improvements

       

      5.3.1                      To
the extent that a Program Improvement is developed by or on behalf of one Party,
that Party will promptly disclose such Program Improvement to the Joint Steering
Committee in writing with all relevant data supporting such Program
Improvement.

       

      5.3.2                      Each
Party will, subject to the terms of Section 5.4, be sole owner of Program
Improvements invented solely by its employees and agents and the employees and
agents of its respective Affiliates.  With respect to such
solely-invented Program Improvements:

       

      (a)           the
Party owning such Program Improvement will own any applications for patent with
respect thereto and any patents issued on such applications, unless such rights
are assigned to the other Party pursuant to Section 5.4;

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (b)           the
Party owning such Program Improvement will determine whether or not to file an
application for patent in the Territory on such Program
Improvement.  If such Party elects to file such an application, such
Party will bear the full costs of preparing, filing, and prosecuting the
application and maintaining any patents that issue thereon and will control the
prosecution of such application; however, the other Party shall have the right,
at its own cost and expense, to reasonably assist such in connection with the
filing, prosecution and maintenance of any patents applications filed under this
Section 5.3.2; any disagreements hereunder, including filing, prosecution and
maintenance decisions or strategies, shall be referred to the Joint Patent
Subcommittee for resolution as provided in Section 3.1.5 ; and

       

      (c)           if
the Party owning such Program Improvement elects not to file an application for
patent in any country in the Territory covering any such Program Improvement,
such Party shall give the other Party notice thereof prior to causing in any way
such Program Improvement to become unpatentable through disclosure, sale, or
otherwise, and the other Party shall thereafter have the right, at its sole
expense, to prepare, file, prosecute and maintain such patent application in any
such country.  Any disagreements hereunder shall be referred to the
Joint Patent Committee for resolution.

       

      5.3.3                      The
Parties will be the joint owners of Program Improvements invented jointly by the
Parties and any Agreement Patents covering such jointly invented Program
Improvements.

       

      5.3.4                      Inventorship
under this Agreement shall be determined in accordance with the patent laws of
the United States.

       

      5.4           Abandonment of Patents and
Applications.  In the event that VALEANT decides not to
maintain a Valeant Patent or to abandon an application that falls under Sections
5.2.1, 5.2.2, or either Party decides not to maintain a Patent or to abandon an
application that falls under Section 5.3 (in either case, the “Abandoning Party”),
such Abandoning Party will give written notice to the other Party at least sixty
(60) days prior to allowing such application to go abandoned or prior to not
taking a necessary step to maintain such patent, and the other Party will have
the option of taking over the prosecution or maintenance of such application or
patent at its sole expense.  If the other Party elects to take over
the prosecution or maintenance of such application or patent pursuant to this
Section 5.4, or if one Party gives the other Party written permission to file
any applications for patent pursuant to Section 5.2.2(c) or Section 5.3.2(c),
the Abandoning Party or Party giving permission will assign all its right, title
and interest in such application or patent to the other Party, subject to the
Abandoning Party or Party giving permission retaining a non-exclusive,
perpetual, irrevocable, sublicensable, fully-paid-up license from the other
Party to such patent or patent application.

       

      5.5           Cooperation.  Each
Party will cooperate, and will cause its employees, Affiliates, consultants and
subcontractors to cooperate with all reasonable requests of the other Party for
assistance in preparation and prosecution and maintenance of any applications
for patent and any patent issuing therefrom and any Trademark and any
registration issuing therefrom that is owned 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      by
the requesting Party hereunder.  To the extent that any right, title,
or interest in or to any intellectual property conceived, created, developed, or
otherwise made by or on behalf of either Party or its Affiliates during the Term
vests in a Party or its Affiliates, by operation of Law or otherwise, in a
manner contrary to the ownership as set forth in this Article V, such Party
shall, and hereby does, on behalf of itself and its Affiliates, irrevocably
assign to the other Party any and all of such Party’s and its Affiliates right,
title, and interest in and to such intellectual property without the need for
any further action by any Party.  Upon a Party’s reasonable request
and at its expense, the other Party promptly shall execute and deliver to the
requesting Party any and all further documents and instruments or take other
reasonable actions which may be necessary or appropriate to achieve and confirm
the requesting Party’s ownership of the intellectual property that is the
subject of this Article V.

       

      5.6           Patent Filing
Procedures.

       

      5.6.1                      Once
a determination has been made to file a patent application for the Valeant
Know-How, a Program Improvement owned solely by VALEANT or a Program Improvement
developed jointly by the Parties, the Joint Patent Subcommittee will determine
in which countries within the Territory such patent applications for the Valeant
Know-How or Program Improvements are to be filed.  With respect to
Valeant Patents, Valeant Know-How, Program Improvements and Agreement Patents,
when a decision is made regarding in which countries patent applications will be
filed and maintained, each Party will, for patents owned by it pursuant to this
Agreement, make Commercially Reasonable Efforts to:

       

      (a)           file
applications for letters patent, in those countries;

       

      (b)           prosecute
all pending and new patent applications and defend against oppositions filed
against the grant of letters patent for such applications, in those countries
where a Party files patent applications;

       

      (c)           upon
and after the grant of any letters patent in any country where it files patent
applications, maintain such letters patent in force by duly filing all necessary
papers and paying any fees required for such purpose by the patent laws of the
particular country in which such letters patent was granted; and

       

      (d)           obtain
such patent extensions or restorations of patent terms as may become available
from time to time in any country in which are issued or filed such patents or
patent applications.

       

      VI.  INFRINGEMENT BY OR CLAIMS
AGAINST THIRD PARTIES

       

      6.1           Notices.  Each
Party will advise the Joint Steering Committee promptly upon its becoming aware
of: (a) any unlicensed activities which such Party believes may be an actual or
impending infringement in the Territory of any patent or other proprietary right
owned or applied for by it or the other Party and related to the Compound, an
Additional Compound, a Product, an Additional Product or the development,
manufacture, use, importation, or sale thereof; (b) any 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      attack
on or appeal of the grant of any patent owned or applied for by it or the other
Party and related to the Compound, Additional Compound, a Product, an Additional
Product or the development, manufacture, use, or sale thereof; (c) any
application for patent by, or the grant of a patent to, a Third Party in respect
of rights which may be related to the Compound, Additional Compound, a Product,
or an Additional Product so as to potentially materially affect the development,
manufacture, use, importation, or sale thereof or which may claim the same
subject matter as or conflict with any patent owned or applied for by it or the
other Party and related to the Compound, Additional Compound, a Product, an
Additional Product, or the development, manufacture, use, importation, or sale
thereof; or (d) any application made for a compulsory license under any patent
owned or applied for by it or the other Party and related to the Compound,
Additional Compound, a Product, an Additional Product or the development,
manufacture, use, importation, or sale thereof.

       

      6.2           Control of
Actions.  The Joint Steering Committee will determine whether
or not to take whatever legal or other action is required in response to
activities requiring notice under Section 6.1 (“Protective
Action”).  If the Joint Steering Committee determines that such
Protective Action is warranted, then, unless the Joint Steering Committee
determines otherwise, GSK shall, at GSK’s expense, commence, prosecute and
control such Protective Action, including the settlement thereof and the
granting of any licenses or sublicense under any Valeant Intellectual Property
or Program Improvement licensed to GSK hereunder; provided, however, that the out-of-pocket expenses
of the Parties for Protective Actions pursued in the Collaboration Territory,
including the expenses of legal counsel, shall be included as an Operating
Expense as provided in Exhibit A and the out-of-pocket expenses of the Parties
for Protective Actions pursued outside the Collaboration Territory shall be
borne entirely by GSK.   VALEANT will  cooperate with
GSK in such action, including being joined as a Party to such action if such
joinder is necessary for standing.  Each Party may be represented by
counsel of its own selection at its own expense in such Protective
Action.  Any recovery obtained as a result of such Protective Action,
whether by judgment, award, decree, or settlement, will, after reimbursement of
the Parties for their reasonable costs and expenses associated with such
Protective Action, be included in and added to the total gross amounts invoiced
for sales of Products if such action relates to the Product (or of Additional
Products if such action relates to an Additional Product) for purposes of
calculating the Net Profit share under the terms of Section 2.3.1 or royalties
under the terms of Section  2.3.2.  To the extent such
recovery is insufficient to reimburse the Parties’ associated reasonable costs
and expenses fully, then a Party’s share of the recovery will be the product of
the total amount recovered with that Party’s reasonable costs and expenses
divided by the sum of both Parties’ reasonable costs and expenses.

       

      6.3           Trademark
Infringement.  Notice regarding potential infringement of and
Control of any Protective Action relating to any Valeant Trademark or GSK
Trademark related to the Compound, an Additional Compound, a Product, an
Additional Product or the development, manufacture, use, importation, or sale
thereof will be addressed in accordance with the applicable Trademark License
Agreement.

       

      VII.  INFRINGEMENT OF THIRD PARTY
RIGHTS

       

      
        
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OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
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      7.1           Third Party Claims.
GSK and VALEANT will each promptly notify the Joint Steering Committee of any
Claim by a Third Party against GSK or VALEANT, or any Affiliate or sublicensee
of VALEANT or GSK, alleging infringement of such Third Party’s intellectual
property rights as a result of the development, manufacture, marketing, sale,
importation, or use of the Compound, Additional Compound, Product, or Additional
Product anywhere in the Territory.  As directed by the Joint Steering
Committee, the Parties will cooperate and use Commercially Reasonable Efforts to
resolve such claimed infringement, with each Party entitled to participate in
the defense and to be represented by counsel of its choice, with each Party
being responsible for the fees of its counsel; provided, however, that if it
appears reasonably likely that the claimed infringement will give rise to a
Claim for indemnification hereunder, then the Party against whom such Claim for
indemnification would be made will have the first right to defend against such
Claim in accordance with Article XII.

       

      7.2           Payments to Third
Parties.  If a Third Party has or receives a patent in any
country that covers the development, manufacture, sale, importation, or use of
the Compound anywhere in the Territory and the Joint Steering Committee
determines that GSK should obtain a license to such patent as to one or more
Products or Additional Products in one or more countries for a royalty or other
payment to such Third Party (including that any Product or Additional Product at
issue cannot be reasonably manufactured differently so as to avoid the
requirement), GSK may enter into such a license agreement, subject to the
approval of the Joint Steering Committee, and may offset *** of any such
royalties or payments to such Third Parties against any share of Net Profits or
royalties that would otherwise have been due to VALEANT for such Product or
Additional Product in such country pursuant to Sections 2.3.1 and 2.3.2 ***
of such Net Profits or royalties due to Valeant. 

       

      VIII.  REPRESENTATIONS AND
WARRANTIES

       

      8.1           Representations and
Warranties of Both Parties.  VALEANT and GSK each hereby
represent and warrant to the other, as of the Effective Date, as
follows:

       

      8.1.1                      It
is a corporation, duly organized, validly existing and in good standing under
the laws of the jurisdiction of its incorporation and has all requisite power
and authority, corporate or otherwise, to conduct its business as now being
conducted, to own, lease and operate its properties and to execute, deliver and
perform this Agreement.

       

      8.1.2                      Except
for the requisite filings under the HSR Act and the expiration or termination of
the waiting period thereunder and any applicable similar competition-related
consents under any jurisdiction other than the United States, no consent,
approval, order or authorization of, or registration, declaration or filing
with, any governmental agency is required to be obtained or made by or with
respect to such Party in connection with its execution, delivery and performance
of this Agreement.

       

      8.1.3                      The
execution, delivery and performance by it of this Agreement and the transactions
contemplated thereby have been duly authorized by all necessary corporate action

       

      
        
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TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
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      and
stockholder action and will not (i) violate any applicable Laws or (ii) result
in a breach of or constitute a default under any material agreement, mortgage,
lease, license, permit or other instrument or obligation to which it is a party
or by which it or its properties may be bound or affected.

       

      8.2           Representations and
Warranties of VALEANT.  VALEANT hereby represents and warrants
to GSK, as of the Effective Date, as follows:

       

      8.2.1                      It
has the full right, power and authority to enter into this Agreement and to
grant the License to GSK.

       

      8.2.2                      Except
as otherwise may have been disclosed by VALEANT to GSK prior the Effective Date,
VALEANT has received no notice that (a) the manufacture, sale, importation or
use of the Compound or Additional Compound within the Field as contemplated
hereby infringes any valid Third Party rights, and (b) the Valeant Patents (to
the extent representing issued patents) are invalid or
unenforceable.

       

      8.2.3                      To
VALEANT’s knowledge, there are no errors in the inventorship set forth in any of
the patent applications comprising Valeant Patents.

       

      8.2.4                      Except
as provided or limited in Article I, VALEANT has licensed to GSK in this
Agreement all rights that it has with respect to Compound and Additional
Compound, and VALEANT does not Control any additional patents, know-how or
information that is necessary or useful for GSK to develop, manufacture and/or
commercialize the Compound and Additional Compound.

       

      8.2.5                      To
VALEANT’s knowledge, no Third Party Controls any (i) confidential and
proprietary know-how, or (ii) patent that is necessary or useful for GSK to
develop, manufacture and/or commercialize the Compound or Additional Compound,
in each case in the Territory for an Epilepsy Indication.

       

      8.2.6                      It
has not previously granted any right, license or interest in or to the Valeant
Patents, or any portion thereof, that is in conflict with the rights or licenses
granted to GSK under this Agreement.

       

      8.2.7                      There
are no investigations, inquiries, actions or other proceedings pending before
any Regulatory Authority with respect to the Compound or Additional Compounds,
and VALEANT has not received written notice threatening any such investigation,
inquiry, action or other proceeding.

       

      8.2.8                      The
development of the Compound and Additional Compounds by or on behalf of VALEANT
have been conducted in compliance in all material respects with all applicable
Laws; and neither VALEANT nor to VALEANT’s knowledge, its Third Party
contractors, have received any written notice which has led VALEANT to believe
that any of the Regulatory Approvals relating to the Compound, Product,
Additional Compounds or Additional Products developed by VALEANT are not
currently in good standing with the FDA or EMEA and VALEANT has no knowledge
that any of its Third Party contractors has developed Compound, Product,
Additional Compounds or Additional 

       

      
        
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TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
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      Product
in a manner that does not comply in all material respects with all applicable
Laws.

       

      8.2.9                      VALEANT
has provided GSK with a fully executed, unredacted copy of the MEDA Agreement in
effect as of the Execution Date, including amendments thereto (which may redact
terms that have no financial effect on GSK).

       

      8.2.10                      Other
than the Background License Agreements, to VALEANT’s knowledge as of the
Effective Date, there are no other agreements to which VALEANT is a Party or to
which VALEANT is subject which may affect VALEANT’s ability to perform its
obligations under this Agreement or GSK’s rights under the License.

       

      8.2.11                      To
its knowledge, there is no pending or threatened product liability action in
relation to the Compound or Additional Compound, and it is not aware of any
grounds for any such product liability action.

       

      8.2.12                      It
has not, up through and including the Effective Date, knowingly withheld any
material information in its possession from GSK in response to GSK’s reasonable
inquiries in connection with GSK’s due diligence relating to the Compound, this
Agreement and the underlying transaction, and to its knowledge, the information
related to the Compound that VALEANT has provided to GSK prior to the Effective
Date is up-to-date and accurate in all material respects.

       

      8.3           Mutual Limitations on
Warranties.  OTHER THAN THE REPRESENTATIONS AND WARRANTIES MADE
BY THE PARTIES PURSUANT TO SECTIONS 8.1 AND 8.2, THE PARTIES DISCLAIM ANY AND
ALL OTHER REPRESENTATIONS AND WARRANTIES WHETHER EXPRESS OR IMPLIED, INCLUDING
ANY REPRESENTATIONS OR WARRANTIES OF NON-INFRINGEMENT, MERCHANTABILITY, OR
FITNESS FOR A PARTICULAR PURPOSE OR ANY REPRESENTATIONS OR WARRANTY ARISING FROM
COURSE OF DEALING OR USAGE OF TRADE.

       

      IX.  COVENANTS

       

      9.1           Covenants of the
Parties.

       

      9.1.1                      Throughout
the Term, VALEANT and GSK will comply in all material respects with all
applicable Laws concerning the development, manufacture, use, and sale of the
Compound, Additional Compounds, Products and Additional Products.

       

      9.1.2                      Neither
VALEANT nor GSK, nor any of their respective employees or consultants who shall
be undertaking any activities related to this Agreement or the subject

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      matter
thereof, shall have been debarred or shall be the subject of debarment or other
disciplinary proceedings by the FDA or any Regulatory Authority in the
Territory.

       

      9.1.3                      VALEANT
shall not amend, without the prior written consent of GSK (such consent not to
be unreasonably withheld or delayed), or voluntarily terminate, any of its
rights under the MEDA Agreement or any other Background License Agreement in any
manner that would materially affect GSK’s rights and benefits under this
Agreement.  VALEANT shall promptly notify GSK of any notice of breach
delivered by it under the MEDA Agreement, or any termination or amendment of any
of the MEDA Agreement that materially and adversely affects GSK’s rights and
benefits under this Agreement.

       

      9.2           Exclusivity.

       

      9.2.1                      During
the Term and on a country-by-country basis, neither GSK nor VALEANT, nor their
respective Affiliates, will, except for Additional Products, (i) directly or
indirectly, promote or market a product *** (a “Direct Competing
Product”), or (ii) *** with respect to a Direct Competing
Product.

       

      (a)           In
the event GSK or its respective Affiliates acquires a Direct Competing Product
or a business or assets that include a Direct Competing Product in a country in
the Territory, GSK will, and will require its Affiliates to, promptly and in no
event later than twelve (12) months from the date of such acquisition, either
divest all rights in such Direct Competing Product in such country as provided
in Section 9.2.1(c) or terminate this Agreement in such country pursuant to
Section 11.3.1(d).

       

      (b)           In
the event VALEANT or its respective Affiliates acquires a Direct Competing
Product or a business or assets that include a Direct Competing Product in a
country in the Territory, VALEANT will, and will require its Affiliates to,
promptly and in no event later than twelve (12) months from the date of such
acquisition, divest all rights in such Direct Competing Product in such country
as provided in Section 9.2.1(c) and cease any activities relating to the sale or
promotion of such Direct Competing Product in such country.

       

      (c)           Notwithstanding
the foregoing, if VALEANT or GSK or any of their respective Affiliates signs a
definitive agreement with respect to a merger or acquisition by operation of
which such Party or its Affiliate would (i) acquire a Direct Competing Product
which is being detailed, promoted or marketed in any country in the Territory
upon the closing of such agreement, or (ii) be acquired by or merge with a Third
Party that has a Direct Competing Product which is being detailed, promoted or
marketed in any country in the Territory upon the closing of such agreement, and
such Party either elects to, or is required to, divest such Direct Competing
Product pursuant to Section 9.2.1(a) or (b) above, then such Party (or the
entity which acquired such Party or the entity into which such Party has merged)
shall have twelve (12)  

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      months
from the signing date of such definitive agreement to divest itself or its
Affiliate of such Competing Product in such country and, during such twelve (12)
month period, the detailing promotion, marketing, and/or sale of such Direct
Competing Product in such country shall not be in violation of the first
sentence of this provision.  Such divestiture can occur by either (x)
an outright sale of all Direct Competing Product rights in such country to a
Third Party, or (y) an out-license (exclusive as to such Party and its
Affiliates) of the right to make, have made, market, promote, use, sell, offer
for sale, export and import such Direct Competing Product in such country; provided, however, that such
Party and its Affiliates may only retain residual financial rights to such
Direct Competing Product in such country and must not exercise or have the
ability to exercise any role or influence in any manner the detailing,
promotion, marketing or sale of such Direct Competing Product in such
country.

       

      9.2.2                      During
the Term and on a country-by-country basis, neither GSK nor VALEANT, nor their
respective Affiliates, will, directly or indirectly, promote or market a product
*** (an “Indirect
Competing Product”), with the exception of the Permitted Products, unless
such Party, prior to the submission of the first MAA for such Indirect Competing
Product, provides notice to the other Party of such development activities and
reasonably demonstrates to the other Party that the promotion or marketing of
such Indirect Competing Product will not adversely affect the commercial
potential of Product, provided, however, that if the
other Party, in good faith, reasonably disagrees with the first Party's
conclusions as to the affects on the commercial potential of the Product, the
matter shall be determined in accordance with the dispute resolution provisions
of Section 14.3.  The Parties acknowledge and agree that factors to be
considered when making a determination that an Indirect Competing Product does
not adversely affect the Product shall include that such Indirect Competing
Product (a) is complementary to Product, (b) treats different stages or phases
of a disease than Product, (c) is an add-on therapy to Product, (d) can be
co-positioned with Product during promotion by a sales force, (e) shall be
promoted to physicians in a different specialty than those targeted for
promotion of Product or (f) shall be promoted using a sales force that is
different from that used with Product (i.e., has no sales representatives or
sales managers in common with).

       

      X.  CONFIDENTIAL
INFORMATION

       

      10.1           Confidentiality.

       

      10.1.1                      During
the Term and for five (5) years thereafter, each Party will use Commercially
Reasonable Efforts to keep, and cause its Affiliates and permitted sublicensees,
if any, to keep confidential all Confidential Information of the other Party,
and neither Party nor any of its Affiliates or sublicensees, if any, will use or
disclose the Confidential Information of the other Party except as expressly
permitted in this Agreement.  The Parties acknowledge that
Confidential Information may have been disclosed by either Party or its
Affiliates to the other Party or its Affiliates pursuant to the Confidentiality
Agreement.  All information disclosed 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      pursuant
to the Confidentiality Agreement will be deemed Confidential Information of the
disclosing Party within the meaning of this Agreement and subject to the terms
hereof.

       

      10.1.2                      The
fact that a particular item of information is not or has ceased to be
Confidential Information by virtue of one or more of the exclusions specified in
the definition of Confidential Information (the “Excluded Item”) shall
not relieve the Party who obtained or received the Excluded Item from that
Party’s obligation of confidentiality and non-use (a) as to any other item of
Confidential Information of the other Party or (b) as to the relationship of the
Excluded Item to any other item of Confidential Information of the other
Party.

       

      10.1.3                      Each
Party hereby acknowledges that the Confidential Information of the other Party
is highly valuable, proprietary, and confidential and that any disclosure to any
officer, employee, agent, or permitted sublicensee of such Party or any of its
Affiliates will be made only to the extent necessary to carry out its
responsibilities under this Agreement and only if such officer, employee, agent,
or permitted sublicensee is informed of the confidential nature thereof and
shall have agreed to hold such information in confidence under confidentiality
provisions at least as stringent as those provided in this Agreement, and each
Party shall be responsible for any breach of such obligation of confidentiality
by its officer’s employees, agents, and permitted sublicensees.

       

      10.1.4                      The
Parties agree that the obligations of this Section 10.1 are necessary and
reasonable in order to protect the Parties’ respective businesses, and that
monetary damages alone may be inadequate to compensate a Party for any breach by
the other Party or any of its Affiliates or their respective officers,
employees, or agents of its covenants and agreements set forth
herein.  The Parties agree that any breach or threatened breach of
this Section 10.1 may cause irreparable injury to the injured Party for which
Damages may not be an adequate remedy and that, in addition to any other
remedies that may be available, in Law and equity or otherwise, such Party will
be entitled to seek equitable relief against the breach or threatened breach of
the provisions of this Section 10.1.

       

      10.1.5                      Following
termination of the License for any reason and at the request of the other, each
Party will destroy all physical records or embodiments of Confidential
Information of the other Party or return such information to the other Party, at
the returning Party’s expense, and a senior officer of such Party shall certify
to the other Party that all such items have been so returned or destroyed; provided, however, that each
Party will be entitled to maintain one copy of the Confidential Information of
the other Party solely for the purpose of monitoring its continuing obligations
hereunder.

       

      10.2           Disclosure to Investors;
Public Announcements.  The Parties have agreed on an initial
press release of the transaction contemplated by this Agreement which is
attached hereto as Exhibit B (the “Initial Press
Release”).  The Initial Press Release may be issued or used by
each Party individually or by the Parties jointly on or after the Effective
Date.  Other than the Initial Press Release, neither Party will,
during the Term or thereafter, originate any publicity, news release or public
announcement, written or oral, whether to the public, the press, 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      stockholders,
or otherwise, disclosing the performance under this Agreement or any of the
specific terms and conditions of this Agreement without the prior written
approval of the other Party, except such announcements, as in the opinion of the
counsel for the Party making such announcement, are required by Law or
regulation (including the regulations of any stock exchange).  If a
Party decides to make an announcement it believes to be required by Law with
respect to this Agreement, it will give the other Party such notice as is
reasonably practicable and the Parties will work together in good faith to
attempt to agree on the content of the disclosure.

       

      10.3           Required
Disclosure.  The receiving Party will be entitled to disclose
Confidential Information where such disclosure is reasonably necessary to
enforce its rights pursuant to this Agreement or where demand for such
disclosure is made on the receiving Party pursuant to: (i) a valid order of a
court or other governmental body or (ii) any other applicable Law; provided that if the receiving
Party intends to make such disclosure or receives such demand, the receiving
Party shall give the disclosing Party prompt notice thereof to enable the
disclosing Party to seek a protective order or other appropriate remedy
concerning any such disclosure.  The receiving Party will co-operate
with the disclosing Party at the disclosing Party’s expense in connection with
the disclosing Party’s efforts to obtain any such order or other
remedy.  If any such order or other remedy does not fully preclude
disclosure, the receiving Party will make such disclosure only to the extent
that such disclosure is legally required and subject to confidentiality, to the
extent available.

       

      10.4           Clinical Trial
Register.  Notwithstanding anything in this Agreement to the
contrary, including in this Article X, GSK shall have the right to publish in
its clinical trial register the results or summaries of the results of all
clinical trials for the Compound, Additional Compound, Products and Additional
Products conducted by either Party in the Territory.

       

      XI.  TERM AND
TERMINATION

       

      11.1           Term.  This
Agreement shall commence on the Effective Date, and unless terminated earlier as
provided in this Article XI, shall continue in full force and effect on a
country-by-country and Product-by-Product (or, if applicable, Additional
Product-by-Additional Product) basis until GSK has no remaining payment
obligations in such country with respect to such Product (the “Term”).

       

      11.2           Termination by
VALEANT

       

      11.2.1                      VALEANT
may terminate this Agreement (a) immediately in the event of a material breach
by GSK or its Affiliates of this Agreement, provided that GSK has
received prior written notice from VALEANT of such breach, specifying in
reasonable detail the particulars of the alleged breach, and such breach has not
been cured within ninety (90) days, or in case of nonpayment of a material
amount due, sixty (60) days, after the date of the relevant notice; or (b)
immediately in the event (i) that GSK becomes insolvent or is unable to pay its
debts when due; (ii) GSK files a petition in bankruptcy, reorganization or
similar proceeding, or, if such a petition is filed against GSK, such petition
is not dismissed within ninety (90) days; (iii) 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      GSK
discontinues all of its business; or (iv) a receiver is appointed or there is an
assignment for the benefit of GSK’s creditors; provided that GSK
does not cease and cause the cessation of such conduct within such ten (10) day
period.

       

      11.2.2                      The
exclusivity provisions of Section 9.2 as applied to GSK will survive such
termination for a period of *** following the effective date of termination by
VALEANT pursuant to Section 11.2.1(a).   Further, if VALEANT
terminates this Agreement pursuant to Section 11.2.1, the License granted to
GSK, and any other rights granted by VALEANT hereunder (including any license to
any Trademarks), will automatically terminate and the following obligations will
apply (the “Program
Transfer Provisions”):

       

      (a)           GSK
will promptly provide to VALEANT complete documentation of all preclinical and
clinical data and all regulatory data, in each case regarding the Compound,
Additional Compounds, the Product and any Additional Products that is Controlled
by GSK and GSK shall grant VALEANT a irrevocable, non-exclusive, royalty-free
sublicensable license to use such data;

       

      (b)           GSK
will grant to VALEANT *** license to Program Improvements that are Controlled by
GSK or its Affiliates;

       

      (c)           Where
any Third Party rights have been obtained by GSK or its Affiliates related to
Compounds, Additional Compounds, Products and Additional Products, GSK will, to
the extent it has the right to do so, promptly assign (or failing assignment, to
sublicense) to VALEANT such Third Party rights;

       

      (d)           To
the extent it has the right to do so, GSK will transfer to VALEANT the ownership
of all regulatory submissions and filings related to the Compound, Additional
Compounds, the Product or Additional Products;

       

      (e)           GSK
will promptly transfer to VALEANT, at GSK’s expense, any inventory and supplies
of Compound, Additional Compounds, Product and Additional Products and any other
inventories or supplies obtained by GSK or its Affiliates for purposes of the
Program at a transfer price equal to GSK’s fully allocated cost to procure them,
and will grant to VALEANT a license to use any GSK Trademarks on such inventory
and supplies in accordance with the terms of the Trademark License
Agreement;

       

      (f)           GSK
will make personnel (as well as the personnel of its Affiliates) reasonably
available to VALEANT to effect an orderly transition to VALEANT of the
information and rights contemplated above in this Section 11.2.2 for a period of
up to *** following the effective date of termination; and

       

      (g)           If
GSK is manufacturing, itself or through a Third Party, Compound, Additional
Compound(s), Product, or Additional Product(s) (each a “GSK Supplied
Material”), GSK will, or will cause such Third Party to, supply VALEANT
with its reasonable 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      requirements
of each GSK Supplied Material at GSK’s fully allocated cost and on customary
terms with respect to quality, ordering and delivery, until VALEANT, on a
material-by-material basis, using Commercially Reasonable Efforts, is able,
itself or through a Third Party, to manufacture such Partner Supplied Material
to meet such reasonable requirements, but in no event shall GSK be obligated to
supply VALEANT with GSK Supplied Material for *** as provided in this Section
11.2.2(g).

       

      ***.

       

      11.3           Termination by
GSK

       

      11.3.1                      GSK
may terminate this Agreement upon written notice to VALEANT (a) immediately in
the event of a material breach by VALEANT or its Affiliates of this Agreement,
provided that VALEANT has
received prior written notice from GSK of such breach, specifying in reasonable
detail the particulars of the alleged breach, such breach is continuing for
ninety (90) days after such notice and such breach has not been cured within
such ninety (90) day period; (b) immediately in the event (i) that VALEANT
becomes insolvent or is unable to pay its debts when due; (ii) VALEANT files a
petition in bankruptcy, reorganization or similar proceeding, or, if such a
petition is filed against VALEANT, such petition is not dismissed within ninety
(90) days; (iii) VALEANT discontinues all of its business; (iv) a receiver is
appointed or there is an assignment for the benefit of VALEANT’s creditors; (c)
upon sixty (60) days' written notice to VALEANT, at GSK’s sole discretion, until
sixty (60) days after receipt by GSK of a copy of the first Complete Response
Letter by the FDA to the first NDA for the first Product under and as defined by
the Prescription Drug User Fee Act; or (d) on a country by country and a Product
by Product (or, if applicable, Additional Product by Additional Product) basis
or in its entirety for any reason: (i) upon ninety (90) days’ prior written
notice to VALEANT prior to the Launch of the first Product in the Field in such
country in the Territory; and (ii) upon one hundred eighty (180) days’ prior
written notice to VALEANT following the Launch of the first Product in the Field
in such country in the Territory; provided that if GSK
elects to terminate under this Section 11.3.1(d) on a Product by Product or
Additional Product by 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      Additional
Product basis, all dosage forms of such Product or Additional Product, as
applicable, in the applicable country must be terminated.

       

      11.3.2                      If
GSK terminates this Agreement pursuant to Section 11.3.1(c) or (d), the Program
Transfer Provisions will apply with respect to the terminated country or
countries in the Territory and terminated Product (or, if applicable, terminated
Additional Product).

       

      11.3.3                      For
the avoidance of doubt, upon GSK’s termination of this Agreement pursuant to
Section 11.3.1(c) or (d), GSK’s rights included in the License granted by
VALEANT to GSK under this Agreement with respect to the terminated portion of
the Territory and terminated Product (or, if applicable, terminated Additional
Product) will immediately and automatically revert to VALEANT; provided, however, that GSK
will have one hundred eighty (180) days from GSK’s termination of the Agreement
to complete the sale of any terminated Product or terminated Additional Product
then in inventory in such terminated portion of the Territory, subject to
payment of royalties and milestone payments pursuant to Article II.

       

      11.3.4                      If
GSK terminates the Agreement pursuant to Section 11.3.1(c) then VALEANT shall,
not later than ninety (90) days after GSK’s notice of such termination, pay to
GSK an amount equal to one hundred million United States dollars (US
$100,000,000) less the cumulative amount per Quarter set forth on Schedule
11.3.4 for the period between the Effective Date and the effective date of
termination pursuant to this Section 11.3.4, pro rated for any partial Quarter
as set forth in Schedule 11.3.4.

       

      11.3.5                      If
GSK terminates the Agreement pursuant to Section 11.3.1(a), then (i) VALEANT's
License grant to GSK will convert to an irrevocable exclusive License, with the
right to sublicense, and will survive termination, and (ii) except as otherwise
provided in this Section 11.3.5, the obligations of the Parties under Article II
will survive such termination.  ***.

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      11.3.6                      If
GSK terminates the Agreement pursuant to Section 11.3.1(b), then (i) VALEANT’s
License grant to GSK will convert to an irrevocable exclusive License, with the
right to sublicense, and will survive termination, and (ii) the obligations of
the Parties under Article II will also survive such termination.  For
the avoidance of doubt, upon termination by GSK pursuant to the terms of Section
11.3.1(a) or (b), VALEANT’s rights to participate in the Joint Steering
Committee will terminate.  All rights and licenses granted under or
pursuant to this Agreement by VALEANT to GSK are, and will otherwise be deemed
to be, for purposes of Article 365(n) of the Bankruptcy Code, licenses of rights
to "intellectual property" as defined under Article 101(52) of the Bankruptcy
Code.  The Parties agree that GSK, as a licensee of such rights under
this Agreement, will retain and may fully exercise all of its rights and
elections under the Bankruptcy Code.  The Parties further agree that,
in the event of the commencement of a bankruptcy proceeding by or against
VALEANT under the Bankruptcy Code, GSK will be entitled to a complete duplicate
of (or complete access to, as appropriate) any such intellectual property and
all embodiments of such intellectual property, and same, if not already in its
possession, will be promptly delivered to GSK.

       

      11.3.7                      If
GSK terminates this Agreement in its entirety in any country or countries
pursuant to Section 11.3.1(d), the exclusivity provisions of Section 9.2 as
applied to GSK will survive such termination for a period of *** following the
effective date of such termination.

       

      11.4           Additional
Rights.  The expiration or termination of this Agreement for
any reason shall not relieve the Parties of any obligation (including any
payments) that accrued prior to such expiration or
termination.  Further, neither Party will be precluded from pursuing
all rights and remedies that it may have hereunder at law or in equity with
respect to any breach of this Agreement nor prejudice either Party’s right to
obtain performance of any obligation.

       

      11.5           Survival.  Upon
the expiration or termination of this Agreement, all rights and obligations of
the Parties under this Agreement shall terminate except those described in
Sections 2.3.5(a)(iii), 2.3.8, 2.3.9, 2.4.3, 2.4.4, 5.1, 5.2, 5.3, 10.1, 10.3,
11.2.2, 11.3.4, 11.3.5, 11.3.6, 11.3.7, 11.4, 11.5, Article XII, 14.2, 14.3,
14.6, and 14.14.

       

      XII.  INDEMNIFICATION AND
LIMITATION OF LIABILITY

       

      12.1           Indemnification of
VALEANT.  GSK shall indemnify and hold harmless each of
VALEANT, its Affiliates and the directors, officers, stockholders and employees
of such entities and the successors and assigns of any of the foregoing (the
“VALEANT
Indemnitees”), from and against any and all liabilities, damages,
penalties, fines, costs, expenses (including, reasonable attorneys’ fees and
other expenses of litigation) (“Liabilities”) from
any claims, actions, suits or proceedings brought by a Third Party (a “Third Party Claim”)
incurred by any VALEANT Indemnitee, arising from, or occurring as a result
of:  (a) activities relating to the research, development,
manufacture, use, marketing, distribution, importation or sale of any Compound,
Product, Additional Compound and Additional Products by GSK, its Affiliates or
sublicensees in the Territory; and/or (b) any material breach of any
representations, warranties or covenants by 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      GSK
in Articles VIII and IX above; except to the extent such Third Party Claims
fall within the scope of VALEANT’s indemnification obligations set forth in
Section 12.2 below or result from the gross negligence or intentional
misconduct of a VALEANT Indemnitee.  For the avoidance of doubt,
Product Liability Claims are not subject to this Section 12.1 and are governed
by the provisions of Section 12.4.

       

      12.2           Indemnification of
GSK.  VALEANT shall indemnify and hold harmless each of GSK,
its Affiliates and sublicensees and the directors, officers and employees of
GSK, its Affiliates and sublicensees and the successors and assigns of any of
the foregoing (the “GSK Indemnitees”),
from and against any and all Liabilities from any Third Party Claims incurred by
any GSK Indemnitee, arising from, or occurring as a result of (a) activities
related to the research, development, manufacture, use, marketing, distribution,
importation or sale of any Compound, Product, Additional Compound and Additional
Products by VALEANT, its Affiliates or sublicensees in the Territory; and/or
(b) any
material breach of any representations, warranties or covenants by VALEANT in
Article VIII and IX above, except to the extent such Third Party Claims
fall within the scope of GSK’s indemnification obligations set forth in
Section 12.1 above or result from the gross negligence or
intentional  misconduct of an GSK Indemnitee.  For the
avoidance of doubt, Product Liability Claims are not subject to this Section
12.2 and are governed by the provisions of Section 12.4.

       

      12.3           Procedure.  A
Party that intends to claim indemnification under this Article XII (the “Indemnitee”) shall
promptly notify the other Party (the “Indemnitor”) in
writing of the assertion or the commencement of Third Party Claim and will
provide the Indemnitor such information with respect thereto that the Indemnitor
may reasonably request.  The Indemnitor shall be entitled to control
and appoint lead counsel for such defense, in each case at its
expense.  If the Indemnitor shall assume the control of the defense of
any Third Party Claim in accordance with the provisions of this Section 12.3,
the Indemnitor shall obtain the prior consent of the Indemnitee (which shall not
be unreasonably withheld) before entering into any settlement of such Third
Party Claim.  The failure to deliver written notice to the Indemnitor
within a reasonable time after the commencement of any action with respect to a
Third Party Claim shall not relieve the Indemnitor of its obligations under this
Article XII unless the delay or failure is prejudicial to its ability to defend
such action.  The Indemnitee under this Section 12.3 shall cooperate
fully with the Indemnitor and its legal representatives in the investigation of
any action with respect to a Third Party Claim covered by this
indemnification.

       

      12.4           Product
Liability.

       

      12.4.1                      Each
Party shall notify the other Party as promptly as practicable if any Third Party
Claim is commenced or threatened against such Party alleging product liability,
product defect, design, packaging or labeling defect, failure to warn or any
similar action relating to the use or safety of Compound, Products, Additional
Compounds and Additional Products (a “Product Liability
Claim”).  For clarity, a Product Liability Claim will not be
deemed to include any Third Party Claims relating to a manufacturing defect of
Compound, Products, Additional 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      Compounds
and Additional Products and Sections 12.1 and 12.2 shall apply to any such Third
Party Claims.

       

      12.4.2                      To
the extent that either the GSK Indemnitees or the VALEANT Indemnitees incur,
suffer, or are faced with any Product Liability Claims with respect to the
Product in the Collaboration Territory, VALEANT and GSK shall share such Product
Liability Claim based on the average percentage share of Net Profits as provided
in Section 2.3.1 for the associated Product over the three (3) months
immediately preceding the date on which such alleged injury occurred or arose,
such that VALEANT shall be liable for the percentage of such Liabilities arising
from Product Liability Claims equal to such percentage share of Net Profit, as
applicable, and GSK shall be liable for the remainder of such
Liabilities.  To the extent one Party shall have paid Third Party
Claims in excess of the amount provided pursuant to this Section 12.4.2, the
other Party shall promptly reimburse such overpaying Party for such excess
amount.

       

      12.4.3                      To
the extent that either the GSK Indemnitees or the VALEANT Indemnitees incur,
suffer, or are faced with any Product Liability Claims with respect to the
Product in the GSK Territory or any Additional Products, GSK shall be solely
liable for all Liabilities arising from such Product Liability Claims, except
that VALEANT shall be liable for any Liabilities arising from such Product
Liability Claims to the extent such Liabilities are due to the gross negligence
or willful misconduct of VALEANT, or the breach by VALEANT of this Agreement,
including any breach of its representations, warranties, covenants or
obligations under this Agreement.

       

      12.4.4                      GSK
shall have the right to control and appoint lead counsel for the defense of any
such Product Liability Claims, and any fees incurred in the defense of such
claims will be considered Liabilities of the Product Liability Claims which will
be shared based upon the formula set forth in Sections 12.4.2 and 12.4.3
above.

       

      12.5           Insurance.  In
addition to its duty to indemnify, each Party will procure product liability
insurance in commercially reasonable amounts in view of its
activities.  Alternatively, either Party may establish a program of
self insurance for the same risks.  In either event, as reasonably
requested in writing by the other Party not more than once every twelve (12)
months, each Party will supply the other Party with evidence of such coverage
during the time any Product is being developed, commercialized or sold by such
Party or any of its Affiliates, sublicensees, designees or agents.

       

      12.6           Disclaimer of Consequential
Damages.  IN NO EVENT WILL EITHER VALEANT OR GSK BE LIABLE TO
THE OTHER FOR ANY SPECIAL, INDIRECT, CONSEQUENTIAL, INCIDENTAL, OR PUNITIVE
DAMAGES ARISING UNDER OR AS A RESULT OF THIS AGREEMENT (OR THE TERMINATION
HEREOF) INCLUDING, BUT NOT LIMITED TO, THE LOSS OF PROSPECTIVE PROFITS OR
ANTICIPATED SALES.

       

      XIII.  TRANSFER OF DEVELOPMENT
PROGRAMS AND INTERIM
SUPPLY

       

      
        
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      13.1           From
the Effective Date, GSK (itself or through an Affiliate) will have the right to
manufacture Compound, Additional Compound(s), Product, and Additional
Product(s), and will have the right, in accordance with the terms of this
Agreement, to appoint one or more Third Parties to manufacture Compound,
Additional Compound, Product or Additional Product.  For the avoidance
of doubt, GSK, subject to Section 1.3(iii), shall have the ultimate decision
making authority over the use of Third Parties in its manufacturing supply
chain.

       

      13.2           Upon
GSK’s request, at GSK’s sole cost and expense, VALEANT, itself or through a
Third Party manufacturer, will supply GSK with Product, Compound, Additional
Compound(s) and/or Additional Product (s) in such forms and quantities as GSK
requests to complete additional pre-clinical studies as well as clinical
studies, and for initial Commercialization, and will do so at VALEANT’s
Manufacturing Cost; provided, however, that
VALEANT’s obligation to supply GSK with Compound or Additional Compound(s) will
not, unless otherwise agreed by the Parties, exceed the quantities or the
timeframe set forth on Schedule 1.4.   In the event that GSK
requests such supply by VALEANT under this Section 13.2, within ninety (90) days
of such request or any such longer period as shall be agreed between the
Parties, the Parties shall enter into a supply and quality agreement as
appropriate relating to supply of Product, Compound, Additional Compound or
Additional Product hereunder.  VALEANT shall not enter into any supply
agreements with Third Parties for the purpose of carrying out its obligations
under this Section 13.2 without the prior written consent of GSK. At the written
request of GSK, VALEANT will assign or facilitate the transfer of any such
agreements with Third Parties to GSK, to the fullest extent possible, provided that such
assignment or transfer is permitted under the supply agreement or is accepted by
the Third Party.

       

      13.3           Compound
and Additional Compound(s) supplied by VALEANT to GSK will meet applicable
Compound Specifications and will not be misbranded or
adulterated.  Compound will be manufactured in accordance with GMPs;
provided, however, that VALEANT
may supply Compound and Additional Compound(s) not manufactured in accordance
with GMP if specifically intended for non-human testing and as agreed to in
writing in advance by GSK. GSK shall have the right to audit the manufacturing
facility of VALEANT, and VALEANT shall procure such an audit right for GSK in
respect of the use of any Third Parties under Sections 13.2 and 13.3, in each
case on reasonable notice for the purpose of ensuring compliance with this
Section 13.3.

       

      13.4           For
the period of supply under Section 13.2, VALEANT will use Commercially
Reasonable Efforts to implement the manufacturing process improvements as agreed
between the Parties in the Development Plans and the resulting savings shall be
reflected in VALEANT’s Manufacturing Costs.  VALEANT shall ensure that
it retains Control over any intellectual property rights arising in the course
of its supply to GSK under Section 13.2.

       

      13.5           Promptly
following the Effective Date and continuing during the Term, upon request by
GSK, and at no cost or expense to GSK, VALEANT will use Commercially Reasonable
Efforts to deliver to GSK all information Controlled by VALEANT, and will use
Commercially Reasonable Efforts to procure that VALEANT’s Third Party
manufacturer(s) 

       

      
        
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      transfer
to GSK all information Controlled by such Third Party manufacturer, in each
case, reasonably necessary or materially useful for GSK or its Affiliates or its
Third Party manufacturer, to commence manufacturing Compound and Additional
Compound(s), including, without limitation, any and all analytical
methods(including applicable reference standards), full batch documentation,
packaging records, release, stability, storage and shelf-life data,
manufacturing process information and on request by GSK, any stocks held by
VALEANT of Product, Compounds or Additional Compounds. VALEANT shall further
provide sufficient technology transfer services, including the necessary
training and expertise and assistance (including any assistance required from
VALEANT or its Third Party manufacturers) at VALEANT’s cost and expense, to
ensure the transfer and replication of the Product, Compound, Additional
Compound and Additional Product manufacturing processes at GSK’s or GSK’s Third
Party manufacturer’s site.

       

      XIV.  MISCELLANEOUS

       

      14.1           Hart-Scott-Rodino.

       

      14.1.1                      HSR
Filing.  If required by applicable Law, both Parties shall
promptly file, following the Execution Date, their respective pre-merger
notification and report forms with the Federal Trade Commission (“FTC”) and the
Department of Justice (“DOJ”) pursuant to the
HSR Act (the “HSR
Filing”).  Each Party will be responsible for its own costs and
expenses associated with any HSR Filing but GSK shall be responsible for payment
of all fees to the FTC and DOJ with respect to such HSR Filing.

       

      14.1.2                      Cooperation.

       

      (a)           The
Parties shall use their Commercially Reasonable Efforts to obtain prompt
clearance required under the HSR Act for the consummation of this Agreement and
the transactions contemplated hereby and shall keep each other apprised of the
status of any communications with, and any inquiries or requests for additional
information from, the FTC and the DOJ and shall comply promptly with any such
inquiry or request; provided, however, that neither
Party shall be required to consent to the divestiture or other disposition of
any of its or its Affiliates’ assets or to consent to any other material
structural or conduct remedy.

       

      (b)           The
Parties hereto commit to instruct their respective counsel to cooperate with
each other and use Commercially Reasonable Efforts to facilitate and expedite
the identification and resolution of any such issues and, consequently, the
expiration of the applicable HSR Act waiting period.  Said
Commercially Reasonable Efforts and cooperation include, but are not limited to,
counsel’s undertaking:  (i) to keep each other appropriately informed
of communications from and to personnel of the reviewing antitrust authority;
and (ii) to confer with each other regarding appropriate contacts with and
response to personnel of the FTC or DOJ.

       

      14.1.3                      HSR Act
Compliance.  Notwithstanding anything to the contrary in this
Agreement, this Section 14.1 shall be binding upon the Parties as of the
Execution Date; 

       

      
        
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      however,
the remainder of this Agreement shall not take effect, and commencement of the
collaboration shall not occur, until the Effective Date, which is based HSR
Clearance Date.  As used herein, the “HSR Clearance Date”
shall mean such time as:  (a) the Parties shall have complied with all
applicable requirements of the HSR Act; (b) the
waiting period under the HSR Act shall have expired or earlier been terminated;
(c) no judicial or administrative proceeding opposing consummation of all or any
part of this Agreement shall be pending; (d) no injunction (whether temporary,
preliminary or permanent) prohibiting consummation of the transactions
contemplated by this Agreement or any material portion hereof shall be in
effect; and (e) no requirements or conditions shall have been formally requested
or imposed by the DOJ or FTC in connection therewith that are not reasonably and
mutually satisfactory to the Parties (collectively, the “HSR
Conditions”).  In the event that the HSR Conditions are not met
within six (6) months of the Execution Date, this Agreement shall be null and
void.

       

      14.2           Governing
Law.  For all matters other than the scope and validity of
patents, this Agreement shall be deemed to have been made in the State of
Delaware and its form, execution, validity, construction and effect shall be
determined in accordance with the laws of the State of Delaware, without giving
effect to the principles of conflicts of law thereof and the Parties agree to
the personal jurisdiction of and venue in any federal or state court located in
Delaware.  The application of the United Nations Convention for
Contracts for the International Sales of Goods is hereby expressly
excluded.

       

      14.3           Dispute
Resolution.

       

      14.3.1                      The Parties agree that with respect to
any disputes that are not within the authority of the Joint Steering Committee
in Article III (all such disputes that are not within the authority of the Joint
Steering Committee would include disputes arising with respect to the
interpretation, enforcement, termination or invalidity of this Agreement, and
for the purposes of this Section 14.3, each a “Dispute”), the Dispute shall first be presented
to the Chief Executive Officer of VALEANT and the Chief Executive Officer of
GSK, or their respective designees for resolution.  If the Chief
Executive Officers, or their respective designees, cannot resolve the Dispute
within thirty (30) days of the request to do so, either Party may initiate
arbitration proceedings with respect thereto as provided in Section 14.3.2
below.  Prior to the establishment of an arbitration
tribunal,  VALEANT and GSK shall each have the
right to apply to any court of competent jurisdiction for appropriate interim or
provisional relief, as necessary to protect the rights or property of that
Party.

       

      14.3.2                      Any
Dispute shall be finally resolved by arbitration in accordance with the
Commercial Arbitration Rules of the American Arbitration Association (“AAA”) then in effect
(the “Rules”),
except as modified herein.  The place of arbitration shall be
Wilmington, Delaware.  If the amount in controversy is $50 million or
less (including all claims and counterclaims) there shall be one (1) neutral and impartial arbitrator
who shall be agreed upon by the Parties within twenty (20) days of receipt by
respondent of a copy of the demand for arbitration.  If the amount in
controversy is more than $50 million (including all claims and counterclaims)
there shall be three (3) arbitrators, of whom each Party shall appoint one (1)

       

      
        
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TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
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      within
thirty (30) days of the receipt by the respondent of the demand for
arbitration.  The three (3) arbitrators so appointed shall select the
chair of the arbitral tribunal within thirty (30) days of the appointment of the
second arbitrator.  If any arbitrator is not appointed within the time
limit provided herein, such arbitrator shall be appointed by the AAA in
accordance with the listing, striking, and ranking procedures in the
Rules.  Any arbitrator appointed by the AAA shall be an attorney with
no less than fifteen (15) years of experience with commercial cases and an
experienced arbitrator, who shall, if practicable, have substantial experience
with transactions or disputes related to the field of pharmaceutical products
and/or, if applicable, intellectual property.  The arbitral tribunal
is not empowered to award damages in excess of compensatory damages, and each
Party hereby irrevocably waives any right to recover punitive, exemplary,
multiple or similar damages with respect to any Dispute.  Any
arbitration proceedings, decision, or award rendered hereunder and the validity,
effect, and interpretation of this arbitration provision shall be governed by
the Federal Arbitration Act, 9 U.S.C. §1 et seq.  The award shall be
in writing and shall state the findings of fact and conclusions of law on which
it is based.  The award shall be final and binding upon the
Parties.  Judgment upon the award may be entered in any court having
jurisdiction.  Any costs or fees (including attorneys’ fees and
expenses) incident to enforcing the award shall be charged against the Party
resisting such enforcement.  The arbitral tribunal shall have full
authority to grant provisional remedies and to direct the Parties to request
that any court modify or vacate any temporary or preliminary relief issued by
such court.

       

      14.3.3                      The
Parties hereby submit to the exclusive jurisdiction of the federal and state
courts located in Delaware for the purpose of an order to compel arbitration,
for preliminary relief in aid of arbitration, or for a preliminary injunction to
maintain the status quo or prevent irreparable harm prior to the appointment of the arbitrators,
and to the non-exclusive jurisdiction of such courts for the enforcement of any
award issued hereunder.  The Parties hereby agree to accept service of
process pursuant to the notice provisions of this Agreement.

       

      14.4           Assignment and Binding
Effect.

       

      14.4.1                      This
Agreement may not be assigned, by operation of law or otherwise, by either Party
without the prior written consent of the other, except as otherwise permitted
under this Section 14.4:

       

      (a)           VALEANT
may assign this Agreement to an Affiliate or to a Third Party without such prior
written consent as part of a merger, consolidation, sale, or transfer of all or
substantially all its assets, but only if the assignee has or simultaneously
acquires all of the necessary rights and other assets to perform VALEANT’s
obligations under this Agreement.  A change of control or ownership of
VALEANT by merger or otherwise will not constitute an impermissible assignment
of this Agreement by VALEANT and such change of control will not result in the
loss, impairment, or alteration of the rights and/or obligations the Parties
hereto, except that upon such change of control or ownership of VALEANT (i) the
Joint Steering Committee and Joint Patent Subcommittee shall cease to exist,
(ii) all obligations and rights of the Joint Steering Committee and Joint Patent
Subcommittee shall vest exclusively in GSK, 

       

      
        
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TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      including
without limitation, the right to make a final decision on matters originally
within the scope of responsibilities of the Joint Steering Committee and Joint
Patent Committee, and (iii) the Third Party successor to VALEANT shall have no
right to participate in the commercialization of Product in the Collaboration
Territory; and

       

      (b)           GSK
may assign this Agreement to any Affiliate or to a Third Party without such
prior written consent as part of a merger, consolidation, sale, or transfer of
all or substantially all its assets, but only if the assignee has or
simultaneously acquires all of the necessary rights and other assets to perform
GSK’s obligations under this Agreement.

       

      14.4.2                      No
assignment under this Section 14.4 shall be effective unless the intended
assignee executes and delivers to the Party which is not the assignor a writing
whereby the assignee expressly undertakes to perform and comply with all of its
assignor’s obligations hereunder.  Notwithstanding such undertaking,
such assignor shall continue to be primarily liable for such assignee’s
performance hereof and compliance herewith.

       

      14.4.3                      Any
assignment in violation of this Section 14.4 shall be void and of no
effect.

       

      14.4.4                      This
Agreement, and the rights and obligations of the Parties herein contained, shall
be binding upon, and shall inure to the benefit of, the Parties and their
respective legal representatives, successors and permitted assigns.

       

      14.5           Independent Contractor
Status.  The relationship of the Parties is that of independent
contractors.  Nothing in this Agreement will be construed to
constitute, create, give effect or otherwise imply a joint venture, agency,
partnership or other formal business organization or any employer/employee
relationship of any kind between the Parties.

       

      14.6           Notices.  All
notices, requests and other communications required or permitted to be given
hereunder or with respect hereto will be in writing, and may be given by (i)
personal service, (ii) registered first-class United States mail, postage
prepaid, return receipt requested, or (iii) overnight delivery service, charges
prepaid, and in each case addressed to the other Party at the address for such
Party as set forth below, and shall be effective upon receipt in the case of
clauses (i) or (iii) above, and five days after mailing in the case of clause
(ii) above.

       

      
        	
                If
      to GSK:

                 

              	
                Glaxo
      Group Limited

                Glaxo
      Wellcome House

                Berkeley
      Avenue

                Greenford,
      Middlesex UB6 0NN

                United
      Kingdom

                Facsimile:
      011 44 208-047-6904

                Attention:  Company
      Secretary

                 

              
	
                With
      a copy to

                 

              	
                GlaxoSmithKline

                709
      Swedeland Road

                 

              

      

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        	 	P.O.
      Box 1539 

                King
      of Prussia, PA 19406-0939 USA

                Facsimile:  (610)
      270-5880

                Attention :  Senior
      Vice President, Worldwide Business Development

                and

                Glaxo
      Smith Kline

                2301
      Renaissance Boulevard

                Mail
      Code RN0220

                King
      of Prussia, PA 19406

                Facsimile:  (610)
      787-7084

                Attention:  Vice
      President and Associate General Counsel, R&D Legal Operations –
      Business Development Transactions

                 

              
	
                If
      to VALEANT:

                 

              	
                Valeant
      Pharmaceuticals International

                One
      Enterprise

                Aliso
      Viejo, California 92656

                Facsimile:
      (949) 461-6641

                Attention:
      General Counsel

                 

              
	
                With
      a copy to

                 

              	
                Skadden,
      Arps, Slate, Meagher & Flom LLP

                Four
      Times Square

                New
      York, New York  10036

              
	 
      	
                Attn:

              	
                Stephen
      F. Arcano

              
	 
      	 
      	
                Ann
      Beth Stebbins

              
	 
      	
                Fax:

              	
                (212)
      735-2000

              

      

       

      The
address of either Party set forth above may be changed from time to time by
written notice in the manner prescribed herein from the Party requesting the
change.

       

      14.7           Further
Assurances.  The Parties will execute and deliver any further
or additional instruments or documents and perform any acts which may be
reasonably necessary in order to effectuate and carry out the purposes of this
Agreement.

       

      14.8           Waivers.  The
waiver by either Party of a default or a breach of any provision of this
Agreement by the other Party will not operate or be construed to operate as a
waiver of any subsequent default or breach.  The continued performance
by either Party with knowledge of the existence of a default or breach will not
operate or be construed to operate as a waiver of any default or
breach.  Any waiver by a Party of a particular provision or right will
be in writing, will be as to a particular matter and, if applicable, for a
particular period of time and will be signed by such Party.

       

      
        
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TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      14.9           Entire
Agreement.  This Agreement (including the Exhibits and
Schedules hereto) constitutes the entire agreement between the Parties, and
supersedes all prior agreements and negotiations with respect to the subject
matter hereof, and may be modified only by written agreement executed by both
Parties.

       

      14.10         Severability.  If
any provision in this Agreement is deemed to be, or becomes, invalid, illegal,
void or unenforceable under applicable laws, then: (i) it will be deleted with
respect to the applicable jurisdiction(s) to which such Law pertains and the
validity, legality and enforceability of the remaining provisions of this
Agreement shall not be impaired or affected in any way, and (ii) the Parties
will use Commercially Reasonable Efforts to substitute for the invalid, illegal
or unenforceable provision a valid, legal and enforceable provision which
conforms as nearly as possible with the original intent of the
Parties.

       

      14.11         Counterparts.  This
Agreement may be executed in more than one counterpart, each of which shall be
deemed to be an original but all of which taken together shall be deemed a
single instrument.  A facsimile transmission of the signed Agreement
will be legal and binding on both Parties.

       

      14.12         Force
Majeure.  Neither Party to this Agreement will be liable for
failure or delay in the performance of any of its obligations hereunder (other
than the failure to pay monies owed), if such failure or delay is due to acts of
God, earthquakes, fires, strikes, acts of war (whether declared or not),
terrorism, civil unrest, or intervention of any governmental authority (a “Force Majeure
Event”), but any such delay or failure will be remedied by such Party as
soon as practicable after the removal of the cause of such failure or
delay.  Upon the occurrence of an event of force majeure, the Party
failing or delaying performance will promptly notify the other Party in writing,
setting forth the nature of the occurrence, its expected duration and how such
Party’s performance is affected, and the Party failing or delaying performance
will use its Commercially Reasonable Efforts to mitigate any damages suffered by
the other Party as a result of the failure or delay.

       

      14.13         Interest on Late
Payments.  If any Party fails to pay in full on or before the
date due any royalty, fee or other amount that is required to be paid to the
other Party under this Agreement, the paying Party will also pay to the other
Party (or its designee), on demand, interest at a rate equal to:  (i)
the prime rate as reported by Citibank N.A., plus two percent (2%) per year; or
(ii) if lower, the maximum rate permitted by law; calculated on the number of
days such payment is delinquent, compounded annually and computed on the basis
of a three hundred sixty five (365) day year.  

       

      14.14         Cumulative Remedies.
Unless otherwise set forth in this Agreement, all rights and remedies of the
Parties, including all rights to payment, rights of termination, rights to
injunctive relief, and other rights provided under this Agreement, shall be
cumulative and in addition to all other remedies provided for in this Agreement,
in law, and in equity.

       

      
        
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TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      14.15         Amendment.  This
Agreement may not be amended, supplemented or otherwise modified except by an
instrument in writing signed by both Parties that specifically refers to this
Agreement.

       

      14.16         Headings and
References.  All section headings contained in this Agreement
are for convenience of reference only and will not affect the meaning or
interpretation of this Agreement.

       

      14.17         No Strict
Construction.  This Agreement has been prepared jointly and
will not be strictly construed against either Party.

       

      

       

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TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      IN
WITNESS WHEREOF, the Parties hereto, intending to be legally bound hereby, have
caused this License and Collaboration Agreement to be executed by their duly
authorized representatives as of the date first written above.

       

      
        	
                VALEANT
      PHARMACEUTICALS

              	 
      	
                GLAXO
      GROUP LIMITED

              
	
                NORTH
      AMERICA

              	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	
                By:

              	/s/
      J. MICHAEL PEARSON	 
      	
                By:

              	/s/
      V.A. WHYTE
	 
      	 
      	 
      
	
                Name:  
      

              	
                J.
      Michael Pearson

              	 
      	
                Name:  
      

              	
                V.A.
      Whyte

              
	 
      	 
      	 
      
	
                Title:

              	
                Chairman
      and CEO                

              	 
      	
                Title:

              	
                Assistant
      Secretary

              

      

      

       

      

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
A

       

      OPERATING
EXPENSES

       

      Operating Expenses are the sum of the
following expenses, determined in accordance with US GAAP and IFRS, as
applicable, for expenses allocated to the GSK Territory consistent with each
Party’s and its Affiliates’ accounting practices used with respect to their
products, to the extent reasonably incurred, (allocated among products,
activities, and territories as specified below).  To the extent that
expenses were specific to the Product and to the Collaboration Territory, 100%
of each item is included in Operating Expenses.  To the extent that
expenses are general to both Products and Additional Products, or to other
products or activities, or to both the Collaboration Territory and other
territories, expenses are divided between the Product and Additional Products,
or among other products, activities and territories, as set forth in the
definition of "Operating Expenses" and Section 2.3.5.

       

      ***.

       

      
         

         

         

      

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      The Parties recognize that it may be
impractical or impossible to precisely allocate expenses between a Product and
non-Products, or between the Collaboration Territory and other territories, and
agree to rely on the Joint Steering Committee’s good faith and commercially
reasonable allocation, provided that GSK and VALEANT have presented to the
Joint Steering Committee their analysis for allocating Operating
Expenses.

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      EXHIBIT B

       

      INITIAL
PRESS RELEASE

       

      
      

       

      
        	 	 

      

       

      
         

        

        

      

       

      

      

      

      VALEANT
PHARMACEUTICALS AND GLAXOSMITHKLINE ANNOUNCE

      WORLDWIDE
COLLABORATION AGREEMENT FOR RETIGABINE

       

      

      
        	
                 
      

              	
                ·

              	
                Retigabine
      is a potentially significant advance for treatment of
    epilepsy

              

      

      
        	
                 
      

              	
                ·

              	
                GSK
      to make upfront payment to Valeant of $125
  million

              

      

      
        	
                 
      

              	
                ·

              	
                Valeant
      to share up to 50 percent of net profits in U.S., Canada, Australia, New
      Zealand and Puerto Rico and receive up to a 20 percent royalty on net
      sales throughout rest of world

              

      

      

      ALISO
VIEJO, California and LONDON, UK, August 28, 2008 – Valeant Pharmaceuticals
International (NYSE: VRX) and GlaxoSmithKline (GSK) today announced that they
have entered into an exclusive worldwide collaboration agreement for the
investigational drug retigabine, a first in class neuronal potassium channel
opener for treatment of adult epilepsy patients with refractory partial onset
seizures.  Retigabine has shown robust efficacy and safety as
demonstrated in two large completed Phase III trials conducted in patients with
refractory epilepsy receiving treatment with up to three antiepileptic drugs
(AEDs).  Valeant and GSK plan to file a New Drug Application in the
U.S. and a Marketing Authorization Application in Europe by early
2009.  The retigabine program also includes an ongoing study in
patients with post-herpetic neuralgia (PHN), a painful and common complication
of shingles.

       

      Under the
terms of the agreement, Valeant will grant GSK worldwide development and
commercialization rights to retigabine, VRX698 and the other back-up compounds
from the potassium channel opener discovery program in exchange for an upfront
payment of $125 million to Valeant.  Additionally, GSK will pay
Valeant up to $545 million based on the achievement of certain regulatory,
development and commercialization milestones and the development of additional
indications for retigabine.  Valeant will co-commercialize with GSK
and will share up to 50 percent of net profits within the U.S., Canada,
Australia, New Zealand and Puerto Rico, and will receive up to a 20 percent
royalty on net sales of retigabine outside those regions.  The two
companies will jointly fund all global research and development expenses for
retigabine, and GSK will completely fund the development of VRX698 and the other
back-up compounds from the potassium channel 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      opener
discovery program.  Valeant could receive up to an additional $150
million based on the achievement of certain regulatory, development and
commercial milestones for VRX698 and the back-up compounds and double-digit
royalties on worldwide sales.

       

      “We were
pleased with the significant interest shown in retigabine and we have selected
GSK as a collaborator because we believe they are ideally suited and strongly
committed to the continued development of this important compound,” stated J.
Michael Pearson, chairman and chief executive officer of
Valeant.  “GSK’s development expertise and strong commercial
infrastructure will be critical to maximizing the worldwide potential of
retigabine.  We believe this collaboration will strengthen our ability
to bring this medicine to patients suffering from epilepsy and a variety of
other conditions.”

       

      “GSK is looking forward to working with
Valeant to provide
important medicines like retigabine to the medical community and to the patients
we serve,” commented Steve
Stefano, senior vice president, GSK U.S. NeuroHealth
Division.  “There is a significant need for novel
anti-epileptic drugs, as almost one-third of patients with epilepsy continue to
experience seizures despite treatment with currently available
medications.  We believe that retigabine could potentially play a
significant role in improving the management of epilepsy and is a welcome
addition to GSK’s portfolio.”

       

      About
Epilepsy

       

      Epilepsy, defined by recurrent
unprovoked seizures, is a change in sensation, awareness, or behavior brought
about by an electrical disturbance in the brain. The kind of seizure a person
has depends on which part and how much of the brain is affected by the
disturbance that produces seizures.  Primary generalized seizures are
those that involve the entire brain from the outset, while partial onset
seizures begin in a focal area of the cerebral cortex.  In most cases
the cause of epilepsy is
unknown.   Epilepsy affects over 50 million people of all ages
worldwide.  Approximately 30 percent of people with epilepsy
experience seizures that are not adequately controlled with currently prescribed
AEDs - the results of which are substantial deleterious effects on individual
health and quality of life.

       

       

      About
Potassium Channel Openers

       

      Potassium channels are one of the
voltage-gated ion channels found in neuronal cells and are an important
determinant of neuronal activity.  Numerous ion-channel mutations have been linked to
epilepsy, and many antiepileptic medications modulate sodium or calcium
channels. Potassium channels have been demonstrated in animal models to be
critical in regulating membrane potential.

       

      Retigabine is the first potassium channel opener to reach late
stage clinical development.  It is believed that by facilitating the
opening of specific neuronal potassium channels, retigabine causes a
hyperpolarizing shift in the potassium current and thereby reduces the
excitability of neuronal
cells.  Dampening of neuronal excitability is an important mechanism
for reducing the potential for seizures.

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      About
the Retigabine Program

       

      Following a Special Protocol Assessment
by the FDA, two Phase III trials of retigabine were initiated in 2005.  RESTORE 1
(Retigabine Efficacy and Safety Trial for partial Onset Epilepsy) was conducted
at approximately 50 sites, mainly in the Americas (U.S., Central/South America),
and RESTORE 2 was conducted at approximately 70 sites, mainly in
Europe.

       

      RESTORE 1 evaluated a 1200 mg daily
dose of retigabine (the highest dose in the RESTORE program) versus placebo, and
RESTORE 2 evaluated a 600 mg and 900mg daily dose of retigabine versus
placebo as adjunctive therapy in patients taking stable doses of one
to three additional AEDs.  At
all three doses tested, retigabine demonstrated statistically significant
(p < 0.01) results on the primary efficacy endpoints important for
regulatory review by both the FDA and the European Medicines Evaluation
Agency.

       

      In RESTORE 1, the median reduction in 28-day
total partial seizure frequency from baseline to the end of the double-blind
period (the FDA primary efficacy endpoint) in the intent-to-treat (ITT)
population was 44.3% (n=151) and 17.5% (n=150) in the retigabine 1200 mg arm and placebo arm of the trial,
respectively.  The responder rate, defined as ≥ a 50% reduction in 28-day total partial
seizure frequency during maintenance (the dual primary efficacy endpoint
required for the European submission) was 55.5% (n=119) and 22.6% (n=137) in the retigabine 1200
mg group and the placebo group of the trial, respectively.

       

      In RESTORE 2, the median reduction in
28-day total partial seizure frequency from baseline to the end of the
double-blind period in the ITT population was 39.9% (n=178), 27.9% (n=181) and 15.9%
(n=179) in the retigabine 900 mg group, retigabine 600 mg group and the placebo
group of the trial, respectively.  The 50% responder rate during the
maintenance phase was 47.0% (n=149), 38.6% (n=158) and 18.9% (n=164) in the retigabine 900 mg, retigabine 600
mg and the placebo arms of the trial, respectively.

       

      The most common side effects associated
with retigabine in the RESTORE trials included dizziness, somnolence, fatigue,
confusion, dysarthria (slurring of speech), ataxia (loss of muscle coordination),
blurred vision, tremor, and nausea. Urinary bladder effects, whilst
monitored during the studies, were uncommonly reported.

       

      In November 2007, Valeant initiated a
Phase II clinical trial of retigabine for the treatment of pain associated with PHN, a painful
and common complication of shingles.  Valeant is also currently
developing a modified release formulation in order to provide a more convenient
dosing schedule, as well as evaluating the potential use of retigabine
in treating other
conditions.

       

      About
Valeant

       

      Valeant Pharmaceuticals International
(NYSE: VRX) is a global specialty pharmaceutical company that develops,
manufactures and markets a broad range of pharmaceutical products primarily in
the areas of neurology,
infectious disease and dermatology. More information about Valeant can be found
at www.valeant.com.

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      About
GlaxoSmithKline

       

      GSK – one of the world’s leading research-based pharmaceutical
and healthcare companies – is committed to improving the quality of
human life by enabling people to do more, feel better and live
longer.  For further information, please visit
www.gsk.com.

       

       

      FORWARD-LOOKING
STATEMENTS

       

      This press release contains
forward-looking statements, including, but not limited to, statements regarding
expectations or plans of development program for retigabine and the potential
role retigabine could play in managing epilepsy and in treating other
indications, and the commercial opportunity retigabine may present for Valeant. These statements are based
upon the current expectations and beliefs of Valeant’s management and are subject to certain
risks and uncertainties that could cause actual results to differ materially
from those described in the forward-looking statements. These risks and uncertainties
include, but are not limited to, risks and uncertainties related to the clinical
development of retigabine, the fact that adverse events are not always
immediately apparent even in well designed clinical trials, regulatory approval processes, the potential
that competitors may bring to market drugs or treatments that are more effective
of more commercially attractive than retigabine, and other risks and
uncertainties discussed in the company’s filings with the SEC. Valeant wishes to caution the reader that
these factors are among the factors that could cause actual results to differ
materially from the expectations described in the forward-looking statements.
Valeant also cautions the reader that undue reliance should not be placed on any of the
forward-looking statements, which speak only as of the date of this release. The
company undertakes no obligation to update any of these forward-looking
statements to reflect events or circumstances after the date of this
release or to reflect actual
outcomes.

       

      
        	
                Valeant
      Contact:

              	 
      	 
      
	
                Investor and
      Media

              	
                Laurie
      W. Little

              	
                (949)
      461 6002

              
	 
      	 
      	 
      
	
                GSK
    Contacts:

              	 
      	 
      
	
                UK
      Media enquiries:

              	
                Philip
      Thomson

              	
                (020)
      8047 5502

              
	 
      	
                Claire
      Brough

              	
                (020)
      8047 5502

              
	 
      	
                Alice
      Hunt

              	
                (020)
      8047 5502

              
	 
      	
                Gwenan
      White

              	
                (020)
      8047 5502

              
	 
      	 
      	 
      
	
                US
      Media enquiries:

              	
                Nancy
      Pekarek

              	
                (919)
      483 2839

              
	 
      	
                Mary
      Anne Rhyne

              	
                (919)
      483 2839

              
	 
      	
                Sarah
      Alspach

              	
                (215)
      751 7709

              
	 
      	 
      	 
      
	
                European
      Analyst/Investor enquiries:

              	
                David
      Mawdsley

              	
                (020)
      8047 5564

              

      

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        	 
      	
                Sally
      Ferguson

              	
                (020)
      8047 5543

              
	 
      	
                Gary
      Davies

              	
                (020)
      8047 5503

              
	 
      	 
      	 
      
	
                US
      Analyst/ Investor enquiries:

              	
                Frank
      Murdolo

              	
                (215)
      751 7002

              
	 
      	
                Tom
      Curry

              	
                (215)
      751 5419

              

      

       

      ###

      

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      EXHIBIT C

       

      TRADEMARK
LICENSE AGREEMENT

       

      THIS
AGREEMENT is entered into as of the ___ day of ______, 200_, by and between
_______________________ (“Licensor”) and
____________________ (“Licensee”).

       

      WHEREAS,
Licensor and Licensee are Parties to a License and Collaboration Agreement dated
as of August __, 2008 (“Agreement”);

       

      WHEREAS,
Licensor or its Affiliates are the owner of the product Trademark(s) set forth
on Attachment 1 hereto for use exclusively with pharmaceutical products
incorporating Compound (as defined in the Agreement) (hereinafter referred to as
the “Licensed
Mark”);

       

      WHEREAS,
Licensee desires to utilize the Licensed Mark in connection with one or more
products contemplated by the Agreement and described as follows [TBD] (“[the Product]”);
and

       

      WHEREAS,
Licensor is willing to grant to Licensee the right to use the Licensed Mark on
the [the Product] and has the ability to do so, on the terms and conditions
hereinafter set forth.

       

      NOW,
THEREFORE, in consideration of the mutual promises and undertakings herein
contained, and for other good and valuable consideration, the Parties agree as
follows:

       

      I

       

      DEFINITIONS

       

      All
capitalized terms used but not otherwise defined herein will have the meanings
ascribed to them in the Agreement.

       

      II

       

      GRANT OF
LICENSE

       

      Licensor
hereby grants to Licensee, and Licensee hereby accepts, an exclusive
royalty-free license to use the Licensed Mark in the Territory (as defined
below) in connection with [the Product], including but not limited to use the
Licensed Mark in such country(ies) in the Territory in connection with the
making, having made, use, sale, offering for sale, importation, packaging,
distributing and promoting of the Product and/or Additional Product in the Field
and in such country(ies) the Territory and as part of a domain name, subject to
the terms and conditions set forth herein. Licensor, at its own cost outside of
the Collaboration Territory and as an Operating Expense inside the Collaboration
Territory, will be responsible for maintaining and renewing Trademark
registrations for the Licensed Mark, subject to Section IX(b)
below.

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      III

       

      TERRITORY AND
TERM

       

      The
Territory shall be as defined in the Agreement.  The term of this
license shall be any period during which Licensee has the right to commercialize
[the Product] during the Term and following termination of the
Agreement.

       

      IV

       

      ACKNOWLEDGMENT OF
RIGHTS

       

      Licensee
acknowledges that Licensor is the owner of the Licensed Mark, and that all use
of the Licensed Mark by Licensee and any resulting goodwill and reputation shall
inures to the benefit of Licensor.  The Licensee acknowledges that the
Licensed Mark is the sole and exclusive property of the Licensor and all
goodwill accrued through use of the Licensed Mark shall be deemed to be the
absolute property of the Licensor.  The Licensee shall at the request
and expense of the Licensor do all such acts and things (including the execution
of any documents) necessary to protect the title of the Licensor to such
goodwill.  Licensee further acknowledges that the Licensor’s rights in
and to the Licensed Mark constitute valuable assets of Licensor.

       

      V

       

      QUALITY
CONTROL

       

      In
order to protect the goodwill and reputation associated with the Licensed Mark,
Licensee covenants and agrees that:

       

      (a)           Quality
of Product: Licensee will provide Licensor with representative specimens of [the
Product] bearing the Licensed Mark and of the packaging, labeling, advertising,
and promotional material showing Licensee’s use of the Licensed
Mark.

       

      (b)           Requirements
of Trademark Use: In all publicly disseminated packaging, labeling, advertising,
and promotional material referencing the Licensed Mark, Licensee will use the
Licensed Mark in the manner set forth in the Requirements of Trademark Use set
forth as Attachment 1 hereto, and in strict accordance with the reasonable
standards of policy, specifications, directions and information given by the
Licensor from time to time.  Any deviation from the Requirements of
Trademark Use must be approved in writing by Licensor, which shall not be
unreasonably withheld or delayed.

       

      (c)           Compliance
with Applicable Laws: Without limiting any other provision of this Trademark
License Agreement, [the Product], the packaging and advertising therefor, and
the manufacture, distribution, promotion, and sale thereof will comply with all
applicable laws and regulations.

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (d)           Licensee
shall immediately inform Licensor of any possible infringement of the Licensed
Mark or of any other matter affecting the validity of he Trademark that may come
to its attention.

       

      VI

       

      TERMINATION AND
RENEWAL

       

      (a)           (i)           Licensor
may terminate this Trademark License Agreement only if Licensee has breached a
material obligation under this Trademark License Agreement and has not cured the
breach within sixty (60) days after notice by Licensor of such breach or, if
such breach is not amenable to cure within such sixty (60) day period, Licensee
has not commenced a cure within such period.

       

      (ii)           Licensee
may terminate this Trademark License Agreement at any time upon notice to
Licensor.

       

      (iii)           Upon
proper termination of this Trademark License Agreement by either Party, Licensee
will discontinue using the Licensed Mark.  Licensee may, however,
continue to use any signs, advertising and marketing materials, purchase orders,
and the like that bear the Licensed Mark and sell any [the Product] bearing the
Licensed Mark in its inventory as of the date of termination until the supplies
have been exhausted, up to six (6) months following such
termination.  Thereafter, Licensee may not use the Licensed Mark, or
any name or mark confusingly similar to the Licensed Mark, in connection with
its pharmaceutical products, except as otherwise permitted by Law.

       

      VII

       

      THIRD PARTY
INFRINGEMENTS

       

      (a)           (i)           If
either Party learns of any use by any Person of any product or material bearing
any name, mark, or designation that infringes or is likely to infringe the
Licensed Mark, it will promptly notify the other Party.  Except as
otherwise provided in subparagraph (ii) of this paragraph (a), whether to take
action shall be in Licensor’s sole discretion, after discussion with
Licensee.  If requested by Licensor, Licensee will join with Licensor
at Licensor’s expense in such action as Licensor in its reasonable discretion
may deem advisable for the protection of its rights, all at Licensor’s
expense.  In connection therewith, Licensee will cooperate to the
extent reasonably required by Licensor to stop such infringement or act, and, if
so requested by Licensor, will join with Licensor as a Party to any action
brought by Licensor for such purpose.  If Licensor determines to take
action, then (subject to subparagraphs (ii) and (iii)) Licensor will have full
control over any action taken, including the right to select counsel, to settle
on any terms it deems advisable in its discretion, to appeal any adverse
decision rendered in any court, to discontinue any action taken by it, and
otherwise to make any decision in respect thereto as it in its discretion deems
advisable.  Licensor will bear all 

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      expenses
connected with the foregoing and any recovery as a result of such action will
belong solely to Licensor

       

      (ii)           Notwithstanding
anything contained in subparagraph (i) of this paragraph (a), if Licensee has
exclusive rights to use the Licensed Mark pursuant to the expiration or earlier
termination of the Agreement and Licensor does not take any action on a Third
Party infringement within 60 days after receiving notice or other evidence of
possible infringement, Licensee may take such action at its sole cost and
expense, in which case any recovery as a result of such action will belong
solely to Licensee.

       

      (iii)           Licensor
will not, without Licensee’s prior written consent, enter into any settlement of
an action brought by Licensor which would (x) affect the rights granted to
Licensee under this Trademark License Agreement, (y) include any admission of
liability on the part of the Licensee or (z) not include an unconditional
release of the Licensee from all liability for claims that are the subject
matter of such action.

       

      (b)           In
addition, if Licensee receives any written notice or claim that the use by
Licensee of the Licensed Mark infringes the intellectual property rights of a
Third Party, then Licensee will promptly so notify Licensor in
writing.  Licensor shall control any action taken in relation to such
notice or claim, provided, however, that if it appears reasonably likely
that the claimed infringement will give rise to a Claim for indemnification
hereunder, then the Party
against whom such Claim for indemnification would be made will have the first
right to defend against such Claim in accordance with Article XII of the
Agreement.  If Licensee is required to obtain a license to such
intellectual property rights, then Licensee may offset against the royalties
otherwise payable to Licensor hereunder but solely as to that portion of the
royalties attributable to the [the Product](s) at issue and in respect of the
country(ies) at issue, the amount of any royalties and other payments paid by
Licensee to the Third Party for such license to the extent it relates to the use
of the Licensed Mark; provided, however, that any
such offset shall be subject to a cap as to any Quarter of 50% of the royalties
or Net Profits otherwise payable for [the Product](s) at issue and in respect of
the country(ies) at issue up to a maximum of fifty-percent (50%) of royalties or
Net Profits.

       

      VIII

       

      TRADEMARK
REGISTRATIONS

       

      (a)           If
registration of Licensee as a registered user of the Licensed Mark is required,
Licensee will bear the cost outside of the Collaboration Territory and such cost
will be an Operating Expense inside the Collaboration Territory, and such costs
will include government fees and reasonable Trademark agents’ fees, relating to
such registration.

       

      IX

       

      MISCELLANEOUS
PROVISIONS

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (a)           No
Joint Venture.  The relationship of the Parties hereto is that of
independent contractors.  Nothing in this Agreement will be construed
to constitute, create, give effect or otherwise imply a joint venture, agency,
partnership or other formal business organization or any employer/employee
relationship of any kind between the Parties.

       

      (b)           Waivers.  The
waiver by either Party of a default or a breach of any provision of this
Trademark License Agreement by the other Party will not operate or be construed
to operate as a waiver of any subsequent default or breach.  The
continued performance by either Party with knowledge of the existence of a
default or breach will not operate or be construed to operate as a waiver of any
default or breach.

       

      (c)           Entire
Agreement.  This Trademark License Agreement (including the Exhibits
and Schedules hereto) together with the Agreement constitutes the entire
agreement between the Parties with respect to the subject matter hereof,
superseding all prior agreements and negotiations.  In the event of
any inconsistency between this Trademark License Agreement and any procedures or
other ancillary agreements or documents contemplated by this Trademark License
Agreement, the terms of this Trademark License Agreement will
govern.

       

      (d)           Governing
Law.  This Trademark License Agreement will be deemed to have been
made in the State of New York and its form, execution, validity, construction
and effect will be determined in accordance with the laws of the State of New
York, without giving effect to the principles of conflicts of law
thereof.

       

      (e)           Amendment.  This
Trademark License Agreement may not be amended, supplemented or otherwise
modified except by an instrument in writing signed by both Parties that
specifically refers to this Trademark License Agreement.

       

      (f)           Assignability
and Sublicensing.  Either Party may assign or transfer this Trademark
License Agreement, provided that the rights
granted hereunder are not adversely affected thereby and any such assignee or
transferee or purchaser expressly agrees in writing to be bound by its
terms.  This Trademark License Agreement and the rights and
obligations hereunder will be binding upon and inure to the benefit of the
Parties hereto and their respective successors (including successors by
operation of law) and legal representatives.

       

      (g)           Notices.  All
notices, requests and other communications required or permitted to be given
hereunder or with respect hereto will be in writing, and may be given by (i)
personal service, (ii) registered first-class United States mail, postage
prepaid, return receipt requested, or (iii) overnight delivery service, charges
prepaid, and in each case addressed to the other Party at the address for such
Party as set forth below, and shall be effective upon receipt in the case of
clauses (i) or (iii) above, and five days after mailing in the case of clause
(ii) above.

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        	
                If
      to GSK:

                 

              	 
      
	 
      	 
      
	 
      	 
      
	 
      	 
      
	
                :

                 

              	 
      
	
                With
      a copy to:

                 

              	 
      
	 
      	 
      
	 
      	 
      
	 
      	 
      
	 
      	 
      
	 
      	 
      
	
                If
      to VALEANT:

                 

              	 
      
	 
      	 
      
	 
      	 
      
	 
      	 
      

      

      

       

      The
address of either Party set forth above may be changed from time to time by
written notice in the manner prescribed herein from the Party requesting the
change.

       

      (h)           Captions.  The
section captions used in this Trademark License Agreement are for reference and
cross-reference purposes only and will not otherwise affect the meaning or
interpretation of this Trademark License Agreement.

       

      (i)           Counterparts.  This
Trademark License Agreement may be executed in more than one counterpart, each
of which will be deemed to be an original but all of which taken together will
be deemed a single instrument.

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      IN
WITNESS WHEREOF, Licensor and Licensee have each caused this Trademark License
Agreement to be duly executed in its corporate name by a duly authorized
representative as of the date first above written.

       

      
        	 
      	
                LICENSEE:

                 

              
	 
      	
                By:

                 

              	 
      
	 
      	
                Name:

                 

              	 
      
	 
      	
                Title:

                 

              	 
      
	 
      	 
      	 
      
	 	 	 
	 	 	 
	 
      	
                LICENSOR:

                 

              
	 
      	
                By:

                 

              	 
      
	 
      	
                Name:

                 

              	 
      
	 
      	
                Title:

                 

              	 
      

      

      

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      ATTACHMENT
2 TO THE TRADEMARK LICENSE AGREEMENT

       

      REQUIREMENTS
OF TRADEMARK USE

       

      1.           The
Licensed Mark will be used in all upper case letters, so as to distinguish them
from the surrounding text.

       

      2.           The
first or most prominent reference to the Licensed Mark will be marked with a
“TM” or “®” symbol, as appropriate.

       

      3.           The
Licensed Mark will be followed by the appropriate generic term at least once in
each package or promotional piece.

       

      4.           The
Licensed Mark will not be used in possessive form.

       

      5.           The
Licensed Mark will not be used in the plural form.

       

      
        
          PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
         

        
          EXHIBIT
D

           

          DEFINITIONS

           

          For
purposes of this Agreement, the following definitions shall apply:

           

          “2008/09 Development
Plan” means the development plan so titled attached hereto as Schedule
3.2.1.

           

          “AAA” has the meaning
ascribed to that term in Section 14.3.2.

           

          “Abandoning Party” has
the meaning ascribed to that term in Section 5.4.

           

          “Acceptance of the First
Filing of an MAA” has the meaning ascribed to that term in Section
2.2.2.

           

          “Act” means the United
States Food, Drug and Cosmetic Act of 1938, as amended from time to time, and
its implementing regulations.

           

          “Additional Compound”
means VRX-698 and any other compounds that are neuronal potassium channel
openers exhibiting primary activity for modulating the KCNQ2/3 receptor
disclosed in the Valeant Patents, the names and structures of which are set
forth on Schedule 1.1.

           

          “Additional Product”
means any pharmaceutical preparation that incorporates an Additional Compound
and does not incorporate the Compound, including any formulation thereof, such
as intravenous, transdermal, oral, or other dosage form.  Without
limitation, each such pharmaceutical preparation having a distinct dosage form
represents a separate Additional Product.

           

          “Affiliate” means,
with respect to any specified Person, at any time, a Person that, directly or
indirectly, through one or more intermediaries, controls, or is controlled by,
or is under common control with, such specified Person at such
time.  For purposes of this definition, “control,” when used with
respect to any specified Person, shall mean (a) the direct or indirect ownership
of more than fifty percent (50%) of the total voting power of securities or
other evidences of ownership interest in such Person or (b) the power to direct
or cause the direction of the management and policies of such Person, directly
or indirectly, whether through ownership of voting securities, by contract or
otherwise; and the terms “controlling” and “controlled” have meanings
correlative to the foregoing.

           

          “Agreement” has the
meaning ascribed to that term in the first paragraph of this
Agreement.

           

          “Agreement Patent”
means a patent or patent application disclosing and claiming a Program
Improvement.

           

          1

          
            
              PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

           

          “Alliance Manager” has
the meaning ascribed to that term in Section 3.1.8.

           

          “Background License
Agreements” means the agreements, letters, and other documents listed in
Schedule 1.2.

           

          “Claim” means any
action, appeal, petition, plea, charge, complaint, claim, suit, demand,
litigation, arbitration, mediation, hearing, inquiry, investigation, or similar
event, occurrence, or proceeding.

           

          “Collaboration
Territory” means the United States, Australia, New Zealand, Canada, and
Puerto Rico.

           

          “Combination Product”
means a Product or Additional Product when sold in combination with one or more
other components and/or active ingredients, which other component(s) and/or
active ingredient(s) contribute(s) substantially to the overall efficacy of the
combination product.

           

          “Commercially Reasonable
Efforts” means that level of efforts and resources consistent with the
usual practice followed by a Party in the exercise of reasonable business
discretion relating to other pharmaceutical products owned by it or to which it
has exclusive rights, which are of similar market potential and at a similar
stage in development or product life, taking into account issues of patent
coverage, safety and efficacy, product profile, the competitiveness of the
marketplace, the proprietary position of the compound or product, the regulatory
structure involved, the profitability of the product (including, without
limitation, pricing and reimbursement status achieved), and other relevant
factors, including without limitation technical, legal, scientific, and/or
medical factors, provided that in the
case of GSK, such efforts shall not take into account the royalties or Net
Profits owed by GSK to VALEANT or the availability to GSK of any Direct
Competing Product or Indirect Competing Product and in the case of VALEANT, such
efforts shall not take into account the royalties or Net Profits received from
GSK under this Agreement or the availability to VALEANT of any Direct Competing
Product or Indirect Competing Product.  For the avoidance of doubt, if
a Direct Competing Product or Indirect Competing Product is being developed by
GSK, GSK shall not be permitted to reduce the level of development efforts,
commercialization efforts and resources that would otherwise be used by GSK in
exercising its Commercially Reasonable Efforts to develop or commercialize the
Product for any indication.

           

          “Compound” means
Retigabine, as described in Schedule 1.1, and will include (i) any compounds
with alternative names but with the same chemical structure as Retigabine, and
(ii) any salts, esters, solvates and/or crystalline polymorphs of Retigabine as
well as any compounds that are transformed into Retigabine following its
introduction into the body of a mammal, their stereoisomers, racemates, salts,
solvates and/or crystalline polymorphs or any of their active metabolites either
prior to or following introduction into the body of a mammal.

           

          2

          
            
              PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

           

          “Compound
Specifications” means the specifications set forth on Schedule
1.3.

           

          “Confidential
Information” means in the case of one Party (the “disclosing Party”),
that Party’s know-how and financial or other confidential or proprietary
non-scientific or non-technical business information that is Controlled by that
Party or its Affiliates and made available (in whatever form and whether prior
to, on, or after the Effective Date) to the other Party (the “receiving Party”)
in connection with this Agreement or generated pursuant to this
Agreement.  Notwithstanding the foregoing, Confidential Information
shall not include:

           

          
            	
                    a)  

                  	
                    information
      which is or becomes part of the public domain through no breach of this
      Agreement by the receiving Party or any of its
  Affiliates;

                  

          

           

          
            	
                    b)  

                  	
                    information
      which the receiving Party can demonstrate by its written records was known
      by the receiving Party or any of its Affiliates prior to the disclosure
      thereof by the disclosing Party;

                  

          

           

          
            	
                    c)  

                  	
                    information
      which is independently developed by the receiving Party or any of its
      Affiliates, so long as such development does not result from use of
      Confidential Information of the disclosing Party, and such independent
      development can be demonstrated by written records of the receiving Party
      or any of its Affiliates; and

                  

          

           

          
            	
                    d)  

                  	
                    information
      that becomes available to the receiving Party or its Affiliates on a
      non-confidential basis, whether directly or indirectly, from a Third Party
      who is not bound by a duty of confidentiality to the disclosing
      Party.

                  

          

           

          “Confidentiality
Agreement” means the Confidentiality Agreement between VALEANT and GSK
dated March 26, 2008.

           

          “Control” or “Controlled” means,
with respect to any compound, material, information, or intellectual property
right, that a Party owns or has a license to use, commercialize, manufacture,
market, distribute or sell, and has the ability to grant to the other Party a
license or a sublicense (as applicable under this Agreement) to such compound,
material, information, or intellectual property right as provided for herein
without violating (i) the terms of any agreement or other arrangements with any
Third Party existing at the time such Party would be first required hereunder to
grant the other Party such license or sublicense or (ii) any Law applicable to
such license or sublicense.

           

          “Development Plans”
has the meaning ascribed to that term in Section 3.2.1.

           

          “Direct Competing
Product” has the meaning ascribed to that term in Section
9.2.1.

           

          “Discriminatory
Conduct has the meaning ascribed to that term in Section
3.4.2(b).

           

          3

          
            
              PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

           

          “Dispute” has the
meaning ascribed to that term in Section 14.3.1.

           

          “DOJ” has the meaning
ascribed to that term in Section 14.1.1.

           

          “Effective Date” means
the HSR Clearance Date, or if it is determined that an HSR Filing is not
required, then the Execution Date.

           

          “EMEA” means the
European Medicines Agency of the European Union or any successor entity thereto
having similar responsibilities with respect to pharmaceutical products such as
the Products.

           

          “Epilepsy Indication”
means any indication that specifically refers to treatment of epilepsy patients
for their epilepsy.

           

          “Escalation Notice”
has the meaning ascribed to that term in Section 3.1.7.

           

          “Exchange Act” has the
meaning ascribed to that term in Section 4.1.

           

          “Excluded Item” has
the meaning ascribed to that term in Section 10.1.2.

           

          “Execution Date” has
the meaning ascribed to that term in the first paragraph of this
Agreement.

           

          “FDA” means the United
States Food and Drug Administration or any successor entity thereto having
similar responsibilities with respect to pharmaceutical products such as the
Products.

           

          “Field” means all
human uses and indications.

           

          “Force Majeure Event”
has the meaning ascribed to that term in Section 14.12.

           

          “FTC” has the meaning
ascribed to that term in Section 14.1.1.

           

          “Generic Equivalent”
means, as to any specific Product or Additional Product at issue which has
received Regulatory Approval in the country at issue, an AB rated generic
version (or equivalent rationale for substitution) of such Product or Additional
Product (including having the same means of introducing Compound into the body
of a patient) which has received Regulatory Approval in such country as follows:
(i) in the United States, from the FDA (x) under an abbreviated NDA which refers
to the specific product at issue as the Reference Listed Drug (as defined in 21
C.F.R. 314.3(b)), (y) under an NDA described in Section 505(b)(2) of the Act as
to which information necessary for approval is contained in the NDA filed as
part of the Program for the specific product at issue but as to which the
applicant in the NDA for such potential Generic Equivalent does not have a right
of reference or (z) by any means by which the potential Generic Equivalent can
obtain Regulatory Approval based, in part, on information contained in the NDA
filed as part of the Program for the specific product at issue but as to which
the applicant in the application for Regulatory Approval for such potential
Generic Equivalent does not have a right of reference granted by the NDA holder;
and (ii) in any other country in the Territory, from the Regulatory Authority
having jurisdiction in such country (x) under an application similar to an
abbreviated NDA which references the specific Product at issue in a manner
similar to a Reference Listed Drug, (y) under an application similar to an NDA
described in Section 505(b)(2) of the Act as to which information necessary for
approval is contained in the NDA filed as part of the Program for the specific
product at issue (or the comparable application filed as part of the Program in
any country at issue) but as to which the applicant in the application for such
potential Generic Equivalent does not have a right of reference or (z) by any
means by which the potential Generic Equivalent can obtain Regulatory Approval
based, in part, on information contained in 

           

          4

          
            
              PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

           

          the
NDA filed as part of the Program for the specific product at issue (or the
comparable application filed as part of the Program in any country in the
Territory) but as to which the applicant in the application for Regulatory
Approval for such potential Generic Equivalent does not have a right of
reference in the Territory granted by the NDA holder.

           

          “GMPs” means current
Good Manufacturing Practices as defined from time to time by the Act, Commission
Directive 2003/94/EC and related regulations or any successor laws or
regulations governing the manufacture, handling, storage, and control of the
Compound in the United States and the European Union, respectively, or as
promulgated by any governmental or regulatory agency having jurisdiction over
the manufacture of Product, Compound, Additional Compound or Additional Product
(as applicable) in the form of laws of regulations.

           

          *** has
the meaning ascribed to that term in Section 2.2.2.

           

          “GSK” has the meaning
ascribed to that term in the first paragraph of this Agreement.

           

          “GSK Auditor” has the
meaning ascribed to that term in Section 2.3.9.

           

          “GSK House Marks” has
the meaning ascribed to that term in Section 3.5.

           

          “GSK Indemnitees” has
the meaning ascribed to that term in Section 12.2.

           

          “GSK Supplied
Material” has the meaning ascribed to that term in Section
11.2.2(h).

           

          “GSK Territory” means
all countries and territories in the Territory other than those in the
Collaboration Territory.

           

          “GSK Trademark” has
the meaning ascribed to that term in Section 1.4.

           

          5

          
            
              PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

           

          “HSR Act” means the
U.S. Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the
rules and regulations promulgated thereunder.

           

          “HSR Clearance Date”
has the meaning ascribed to that term in Section 14.1.3.

           

          “HSR Conditions” has
the meaning ascribed to that term in Section 4.1.3.

           

          “HSR Filing” has the
meaning ascribed to that term in Section 14.1.1.

           

          “Immediate Release
Product” means Product having a formulation that is the same as that used
in Phase II Clinical Studies and Phase III Clinical Studies for Product prior to
the Effective Date.

           

          “Indemnitee” has the
meaning ascribed to that term in Section 12.3.

           

          “Indemnitor” has the
meaning ascribed to that term in Section 12.3.

           

          “Initial Press
Release” has the meaning ascribed to that term in Section
10.2.

           

          “IND” means any
Investigational New Drug Application (including any amendments thereto) filed
with the FDA pursuant to 21 C.F.R. §321 before the commencement of
clinical trials of a Product or Additional Product, as applicable, or any
comparable filings with any Regulatory Authority in any other
jurisdiction.

           

          “Indirect Competing
Product” has the meaning ascribed to that term in Section
9.2.2.

           

          “Joint Steering
Committee” means the committee described in Section 3.1.1.

           

          “Launch” means, on a
country-by-country basis, the date of the first bona fide, arm’s length sale
of a Product or Additional Product, as the case may be, in the Field and in a
country following Regulatory Approval by GSK (or one of its Affiliates or
permitted sublicensees) to a non-sublicensee Third Party in the Territory
following Regulatory Approval.  Sales of a Product for registration
samples, compassionate use sales, named patient use, inter-company transfers to
Affiliates of GSK and the like will not constitute a Launch.

           

          “Law” means all laws,
statutes, regulations, or governmental, regulatory, or judicial orders
or judgments in effect from time to time.

           

          “Liabilities” has the
meaning ascribed to that term in Section 12.1.

           

          “License” has the
meaning ascribed to that term in Section 1.1.

           

          6

          
            
              PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

           

          “MAA” means an NDA
submitted to the FDA in the United States or a corresponding application for
Regulatory Approval that has been submitted to a Regulatory Authority in any
other country in the Territory.

           

          “Major Additional
Indication” has the meaning ascribed to that term in Section
2.2.2.

           

          “Major Indication” has
the meaning ascribed to that term in Section 9.2.2.

           

          “Major EU Country”
means the United Kingdom, France, Spain, Italy or Germany.

           

          “Manufacturing Cost”
means VALEANT’s costs as described in Schedule 1.4.

           

          “Marketing Plan” means
the marketing plan for the Product in the Collaboration Territory, as prepared
by GSK in accordance with GSK’s normal and customary format and process for such
plans, and reviewed and approved by the Joint Steering Committee as described in
Section 3.4.1, as amended from time to time by GSK and approved by the Joint
Steering Committee during the Term.

           

          “Marketing Strategy”
means the marketing strategy for the Product in the Territory determined by GSK
and reviewed by the Joint Steering Committee, including product positioning,
pricing, education programs, publications, sales messages, and Phase IIIb and
Phase IV Clinical Studies, as such strategy may be amended by GSK from time to
time during the Term.

           

          “MEDA Agreement” means
the Asset Purchase Agreement between Viatris GmbH & Co. KG and Xcel
Pharmaceuticals, Inc. dated January 22, 2004, including any written amendments
signed by the parties thereto.

           

          “Modified Release
Product” means Product that is a reformulation of the Immediate Release
Formulation utilizing sustained release formulation, providing for once-daily or
twice-daily dosing of Product in humans.

           

          “NDA” means a New Drug
Application as defined in Title 21 of the U.S. Code of Federal Regulations,
Section 314.50, et seq., which is filed with the FDA in order to gain the FDA’s
approval to commercialize a pharmaceutical product in the United States for the
indications set forth in the New Drug Application.

           

          “Net Profits” means
Net Sales of Product less Operating Expenses.

           

          “Net Sales” means the
amount of gross sales of Products or, as applicable, Additional Products in a
specified country or countries in the Territory for a specified period sold by
GSK, its Affiliates or sublicensees (the “Selling Party”) to Third Parties less
the following amounts actually and reasonably incurred, allowed, paid or accrued
as reported by the Selling Party in its 

           

          7

          
            
              PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

           

          financial
statements prepared in accordance with the International Financial Reporting
Standards (“IFRS”), applied on a consistent basis:

           

          (a)           customer
directed commissions and quantity, trade and cash discounts actually allowed or
given;

           

          (b)           discounts,
replacements, credits or refunds actually allowed for the return of rejected,
outdated, damaged or returned Products;

           

          (c)           rebates,
chargebacks and price adjustments actually allowed or given;

           

          (d)           sales
or similar taxes (including duties or other governmental charges or assessments)
levied, absorbed, or otherwise imposed on the sale of Products (including VAT or
other governmental charges measured by the billing amount, when included in such
billing); and

           

          (e)           charges
for freight, handling, postage, transportation, insurance and other shipping
charges;

           

          provided, however,
that:

           

          (i)           sales
or transfers of Products (or Additional Products) between or among GSK, any
permitted sublicensee or any Affiliate of GSK, as well as sales or transfers
resulting directly or indirectly from any Seller License, shall be excluded from
Net Sales calculations for all purposes;

           

          (ii)           Products
or Additional Products that are made, sold or used in connection with any
pre-clinical or clinical trials, or for any testing, quality control, evaluation
or other development purposes, or distributed as samples, shall be excluded from
Net Sales calculations for all purposes; and

           

          (iii)           for
Combination Products, the computation of Net Sales in a country shall be based
on the relative average net selling price of the applicable Product or
Additional Product in such country at issue as compared with the net selling
prices of the other components or active ingredients contributing substantially
to the overall efficacy of the Combination Product (as determined by identical
methods, to the extent practical) during the applicable Quarter (although, if
the Product, Additional Product or such other components or active ingredients
were not separately invoiced or priced during the applicable quarterly period,
the Net Sales computation shall be based on the relative fair market prices
which the selling party would have charged for the Product or Additional Product
and such other components or ingredients to a Third Party in an arm’s length
transaction, as determined by GSK in its reasonable discretion); provided, however, that in the
instance of any Combination Product where the Product or Additional Product is
sold in combination with a diagnostic device, the 

           

          8

          
            
              PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

           

          computation
of Net Sales for such Product or Additional Product shall be based solely on the
average net selling price of the applicable Product in the country at issue when
sold as a stand-alone product.

           

          “Non-Epilepsy
Indication” means any indication specifically for treatment of a
non-epileptic condition, including treatment of neuropathic pain, treatment of
bipolar disorder, and treatment to prevent migraine headaches.

           

          “Operating Expenses”
means the expenses described in the categories set forth on Exhibit A to the
extent such expenses are reasonably incurred, on a fully-allocated basis, and
properly allocable to and deductible from sales of the Product in the
Collaboration Territory in accordance with Article II of this Agreement, provided, however, that
following the Launch of the Modified Release Product in the Collaboration
Territory, all Operating Expenses relating or attributable exclusively to the
Immediate Release Product in a particular country in the Collaboration Territory
shall be allocated solely to the Immediate Release Product and all Operating
Expenses relating or attributable exclusively to the Modified Release Product
shall be allocated solely to the Modified Release Product.  To the
extent that any such Operating Expenses cannot be attributable exclusively to
the Immediate Release Product or Modified Release Product, such Operating
Expenses will be allocated to the Immediate Release Product and to the Modified
Release Product pro rata in proportion to the Net Sales of Immediate Release
Product and Modified Release Product in the Collaboration
Territory.

           

          “Party” means VALEANT
or GSK and “Parties” means
VALEANT and GSK.

           

          “Payment Report” has
the meaning ascribed to such term in Section 2.3.5.

           

          “Permitted Products”
means ***.

           

          “Person” means any
individual, corporation (including any non profit corporation), general or
limited partnership, limited liability company, joint venture, estate, trust,
association, organization, labor union, or other entity.

           

          9

          
            
              PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

           

          “Phase I Clinical
Studies” means studies, including the initial introduction of a drug into
humans, to determine the metabolic and pharmacologic actions of the drug in
humans, as more fully defined in 21 C.F.R. §312.21(a), or its successor
regulation, or the equivalent in any foreign country.

           

          “Phase II Clinical
Studies” means early controlled human clinical studies conducted to
obtain some preliminary data on the appropriate dose range and effectiveness of
a drug in a disease or condition under study, as more fully defined in 21 C.F.R.
§312.21(b) or its successor regulation, or the equivalent in any foreign
country.

           

          “Phase III Clinical
Studies” means expanded and controlled human clinical studies involving
administration of a drug to sufficient numbers of human patients with the goal
of establishing that a drug is safe and efficacious for its intended use, and to
be considered as a pivotal study for submission of an NDA, as more fully defined
in 21 C.F.R. §312.21(c) or its successor regulation, or the equivalent in any
foreign country.

           

          “Phase IV Clinical
Studies” means post-approval FDA study commitments (including
registries), marketing support studies, investigator initiated studies, and
company initiated studies, in each case not primarily directed towards a change
of label.

           

          “Positive Proof of
Concept” has the meaning ascribed to that term in Section
2.2.2.

           

          “Pre-Launch Period”
has the meaning ascribed to that term in Section 2.3.5(a)(i).

           

          “Product” means any
pharmaceutical preparation that incorporates Compound, whether or not as the
sole active ingredient, including any formulation thereof, such as intravenous,
transdermal, oral, or other dosage form.  Without limitation, each
such pharmaceutical preparation having a distinct dosage form represents a
separate Product.

           

          “Product Liability
Claim” has the meaning ascribed to that term in Section
12.4.1.

           

          “Program” means all
activities related to the development and commercialization of Compound or
Products performed by or on behalf of VALEANT (or its Affiliates) and/or GSK (or
its Affiliates) pursuant to this Agreement; provided, however, that all
activities related to the development of Compound conducted prior to the
Effective Date will be deemed to have been conducted outside of the
Program.

           

          “Program Improvements”
means any and all confidential know-how, and other information that is developed
by or on behalf of GSK (or its Affiliates) or VALEANT (or its Affiliates) or
jointly by or on behalf of GSK and VALEANT or any of their respective
Affiliates, in connection with the Program, including inventions, developments,
results, clinical, technical, scientific, and 

           

          10

          
            
              PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

           

          medical
information, know-how, methods, inventions, practices, and trade secrets,
quality control information and procedures, pharmacological, toxicological and
clinical test data and results and regulatory information and all intellectual
property relating to any of the foregoing; provided, however, that Program
Improvements will not include Valeant Intellectual Property and provided further that, Program
Improvements shall not include (i) information which is or becomes part of the
public domain through no breach of this Agreement by GSK or VALEANT; (ii)
information which GSK can demonstrate by its written records was known by GSK or
its Affiliates prior to the Effective Date; and (iii) information which is
independently developed by GSK or VALEANT or their respective Affiliates outside
of the Program, and such independent development can be demonstrated by written
records.

           

          “Program Transfer
Provisions” has the meaning ascribed to that term in Section
11.2.2.

           

          “Protective Action”
has the meaning ascribed to that term in Section 6.2.

           

          “Quarter” means a
calendar quarter consisting of any of the three-month periods ending on March
31, June 30, September 30 and December 31 in any particular year.

           

          “Regulatory Approval”
means: (a) in the United States, written notice of marketing approval by the FDA
based on approval of an NDA and (b) in any other country in the Territory,
written notice of required marketing approval by the Regulatory Authority having
jurisdiction in such country; provided that with
respect to countries in the European Union, written notice of a centralized
marketing authorization from the European Medicines Agency shall constitute
written notice with respect to each and every such country.

           

          “Regulatory Authority”
means the agency, if any, of the national government of any country with which a
pharmaceutical or biological therapeutic product must be registered or by which
a pharmaceutical or biological therapeutic product must be approved prior to its
manufacture, use, or sale in such country, provided that with
respect to countries in the European Union, the European Medicines Agency shall
constitute such an agency with respect to each and every such country in
addition to any agency of a national government of such country.

           

          “Regulatory Exclusivity
Period” means: the time period following Regulatory Approval in a country
of an MAA for a reference product during which an applicant for an MAA for the
same product or a similar product containing the same active pharmaceutical
ingredient(s) in the same country shall be required to provide the results of
pre-clinical and clinical trials for such applicant’s product rather than
referring to information that is contained in the dossier of the MAA of the
reference product, provided that for any country
that does not provide such a time period, the Regulatory Exclusivity Period
shall be deemed to be ten (10) years.

           

          11

          
            
              PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

           

          “Review Period” means
the period commencing on the Effective Date and expiring on the date on which
GSK delivers written notice to VALEANT that GSK is waiving its right to
terminate this Agreement pursuant to Section 11.3.1(c) or the date on which such
time period lapses without such notice from GSK.

           

          “Rules” has the
meaning ascribed to that term in Section 14.3.2.

           

          “Safety Issue” means
any unexpected or untoward adverse event related to a Product or Additional
Product that is reported to a Party by a patient or physician, or about which a
Party becomes aware, which event raises a question about patient safety or the
efficacy of such Product or Additional Product and which event a Party considers
to be serious enough to contemplate taking a prompt affirmative action with
respect to such Product or Additional Product..

           

          “Senior Executives”
has the meaning ascribed to that term in Section 3.1.7.

           

          “Senior Patent
Executives” has the meaning ascribed to that term in Section
3.1.5.

           

          “Subcommittee” has the
meaning ascribed to that term in Section 3.1.4.

           

          “Term” has the meaning
ascribed to that term in Section 11.1.

           

          “Territory” means all
countries and territories of the world.

           

          “Third Party” means
any Person other than VALEANT or GSK or an Affiliate or an employee of VALEANT
or GSK.

           

          “Third Party Claim”
has the meaning ascribed to that term in Section 12.1.

           

          “Trademarks” means (a)
trademarks, service marks, logos, trade dress and trade names, and domain names
indicating the source of goods or services, and other indicia of commercial
source or origin (whether registered, common law, statutory or otherwise), (b)
all registrations and applications to register the foregoing anywhere in the
world, (c) all goodwill associated therewith, and (e) all rights in and to any
of the foregoing.

           

          “Trademark License
Agreement” means an agreement in the form attached hereto as Exhibit
C.

           

          “United States” or
“U.S.” means
the fifty (50) states of the United States of America and the District of
Columbia.

           

          “VALEANT” has the
meaning ascribed to that term in the first paragraph of this
Agreement.

           

          “Valeant Auditor” has
the meaning ascribed to that term in Section 2.3.8.

           

          12

          
            
              PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

           

          “VALEANT House Marks”
has the meaning ascribed to that term in Section 3.5.

           

          “VALEANT Indemnitees”
has the meaning ascribed to that term in Section 12.1.

           

          “Valeant Intellectual
Property” means Valeant Patents and Valeant Know-How.

           

          “Valeant Know-How”
means all confidential know-how and information relating to any or all of
Compound, Additional Compound(s), Products or Additional Products, including
clinical, technical, scientific, and medical information, know-how, methods,
inventions, practices, and trade secrets, quality control information and
procedures, pharmacological, toxicological and clinical test data and results
and regulatory information, in each case, which (i) VALEANT or its Affiliates
Controls prior to the Effective Date, or (ii) is developed by or on behalf of
VALEANT or its Affiliates or acquired by VALEANT or its Affiliates, in each
case, after the Effective Date outside the Program and without the use of
Program Improvements.  Notwithstanding the foregoing, Valeant Know-How
shall not include (a) information which is or becomes part of the public domain
through no breach of this Agreement by GSK; (b) information which GSK can
demonstrate by its written records was known by GSK or its Affiliates prior to
the disclosure thereof by VALEANT; (c) information which is independently
developed by GSK or its Affiliates outside of the Program, so long as such
development does not result from use of Valeant Know-How, and such independent
development can be demonstrated by written records; and (d) information that
becomes available to GSK or its Affiliates on a non-confidential basis, whether
directly or indirectly, from a Third Party who is not bound by a confidentiality
obligation to VALEANT.

           

          “Valeant Patents”
means: (a) the patents set forth on Schedule 1.5 hereto and any re-examination
and reissue applications thereof; (b) any applications for patents listed in
Schedule 1.5 hereto, and any divisional, continuation, or continuation-in-part
of any such application, and any patent which shall issue based on such
application, divisional, continuation or continuation-in-part, and any extension
(including Supplementary Protection Certificates), re-examination and reissue
applications thereof; (c) any application for patent filed hereafter or patent
issued hereafter in any jurisdiction claiming priority to any application for
patent or any patent identified in the foregoing clauses (a) or (b); (d) all
patents issued to and applications for patent filed by VALEANT or its Affiliates
in accordance with the provisions of Section 5.2; and (e) all patents issued to
and applications for patent filed by VALEANT or its Affiliates covering the
Compound arising from Valeant Know-How.

           

          “Valeant Trademark”
has the meaning ascribed to such term in Section 1.4.

           

          “Valid Claim” means
any claim of an unexpired patent included in Valeant Patents or Agreement
Patents that has neither been held unenforceable, unpatentable, nor invalid by a
final decision of a court or a governmental agency of competent jurisdiction
(including any competent patent office), from which no further appeal is
possible.

           

          13

          
            
              PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION").
THE OMISSIONS HAVE BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.

              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

           

          *** means
the development plan so titled attached to this Agreement as Schedule
3.2.1.

           

          Construction.  For
purposes of this Agreement: (a) words in the singular shall be held to include
the plural and vice versa as the context requires; (b) the word “including” and
“include” shall be deemed to be followed by the phrase “without limitation” or
like expression unless otherwise specified; (c) the terms “hereof,” “herein,”
“herewith,” and “hereunder,” and words of similar import shall, unless otherwise
stated, be construed to refer to this Agreement as a whole and not to any
particular provision of this Agreement; (d) all references to a “business day”
or “business days” in this Agreement means any day other than a day which is a
Saturday, a Sunday, any day banks are authorized or required to be closed in the
United States or any other day on which GSK’s corporate headquarters in the
United States are closed; and (e) all references to “Section,” “Article,”
“Schedule” and “Exhibit,” unless otherwise specified, are intended to refer to a
Section, Article, Schedule or Exhibit of or to this Agreement.

           

           

           

           

           

           

           

           

           

           

           

           

           

           

           

           

           

           

           

          14

          
PORTIONS OF THIS EXHIBIT
HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT FILED WITH
THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION"). THE OMISSIONS HAVE
BEEN INDICATED BY ASTERISKS ("***"), AND THE OMITTED TEXT HAS BEEN FILED
SEPARATELY WITH THE COMMISSION.Filed by Bowne Pure Compliance

Exhibit 10.1

[director]

INDEMNIFICATION AGREEMENT

This Indemnification Agreement (“Agreement”) is made and entered into as of
 _____ 
, 2008
by and between Quanex Building Products Corporation, a Delaware corporation (the “Corporation”),
and                      (“Indemnitee”). This Agreement supersedes and replaces any and all previous
Agreements between the Corporation and Indemnitee covering the subject matter of this Agreement.

RECITALS

WHEREAS, highly competent persons have become more reluctant to serve publicly-held
corporations as directors and officers or in other capacities unless they are provided with
adequate protection through insurance or adequate indemnification against inordinate risks of
claims and actions against them arising out of their service to and activities on behalf of the
corporation;

WHEREAS, the Board of Directors of the Corporation (the “Board”) has determined that, in order
to attract and retain qualified individuals, the Corporation will attempt to maintain on an ongoing
basis, at its sole expense, liability insurance to protect persons serving the Corporation and its
subsidiaries from certain liabilities. Although the furnishing of such insurance has been a
customary and widespread practice among United States-based corporations and other business
enterprises, the Corporation believes that, given current market conditions and trends, such
insurance may be available to it in the future only at higher premiums and with more exclusions.
At the same time, directors, officers, and other persons in service to corporations or business
enterprises are being increasingly subjected to expensive and time-consuming litigation relating
to, among other things, matters that traditionally would have been brought only against the
Corporation or business enterprise itself. Article XI of the By-laws of the Corporation requires
indemnification of the officers and directors of the Corporation. Indemnitee may also be entitled
to indemnification pursuant to the General Corporation Law of the State of Delaware (the “DGCL”).
The By-laws and the DGCL expressly provide that the indemnification provisions set forth therein
are not exclusive, and thereby contemplate that contracts may be entered into between the
Corporation and members of the board of directors, officers and other persons with respect to
indemnification;

WHEREAS, the uncertainties relating to such insurance and to indemnification have increased
the difficulty of attracting and retaining such persons;

WHEREAS, the Board has determined that the increased difficulty in attracting and retaining
such persons is detrimental to the best interests of the Corporation and its stockholders and that
the Corporation should act to assure such persons that there will be increased certainty of such
protection in the future;

WHEREAS, it is reasonable, prudent and necessary for the Corporation contractually to obligate
itself to indemnify, and to advance expenses on behalf of, such persons to the fullest extent
permitted by applicable law so that they will serve or continue to serve the Corporation free from
undue concern that they will not be so indemnified;

WHEREAS, this Agreement is a supplement to and in furtherance of Article XI of the By-laws of
the Corporation and any rights granted under the Certificate of Incorporation of the Corporation
and any resolutions adopted pursuant thereto, and shall not be deemed a substitute therefor, nor to
diminish or abrogate any rights of Indemnitee thereunder;

 

 

 

WHEREAS, Indemnitee is willing to serve as a director of the Corporation, and the Corporation
desires Indemnitee to serve in such capacity and is willing to indemnify Indemnitee as described
hereunder; and

NOW, THEREFORE, in consideration of the premises and the covenants contained herein, the
Corporation and Indemnitee do hereby covenant and agree as follows:

Section 1. Services to the Corporation. Indemnitee agrees to serve as a director of
the Corporation and, at the request of the Corporation, as a director, officer, employee, or agent
of another corporation, partnership, joint venture, trust, employee benefit plan or other
enterprise. Indemnitee may at any time and for any reason resign or be removed from such position
(subject to any other contractual obligation or any obligation imposed by operation of law), in
which event the Corporation shall have no obligation under this Agreement to continue Indemnitee in
such position. This Agreement shall continue in force after Indemnitee has ceased to serve as a
director of the Corporation.

Section 2. Definitions. As used in this Agreement:

(a) References to “agent” shall mean any person who is or was a director, officer, or employee
of the Corporation or a Subsidiary of the Corporation or other person authorized by the Corporation
to act for the Corporation, to include such person serving in such capacity as a director, officer,
employee, fiduciary or other official of another corporation, partnership, limited liability
company, joint venture, trust or other Enterprise at the request of, for the convenience of, or to
represent the interests of the Corporation or a Subsidiary of the Corporation.

(b) A “Change in Control” shall be deemed to occur upon the earliest to occur after the date
of this Agreement of any of the following events:

i. Acquisition of Stock by Third Party. Any Person (as defined below) is or becomes the
Beneficial Owner (as defined below), directly or indirectly, of securities of the Corporation
representing thirty-five percent (35%) or more of the combined voting power of the Corporation’s
then outstanding securities, without prior approval of at least two-thirds members of the Board of
Directors in office immediately prior to such person attained such percentage interest;

ii. Change in Board of Directors. During any period of two (2) consecutive years (not
including any period prior to the execution of this Agreement), individuals who at the beginning of
such period constitute the Board, and any new director (other than a director designated by a
person who has entered into an agreement with the Corporation to effect a transaction described in
Sections 2(b)(i), 2(b)(iii) or 2(b)(iv)) whose election by the Board or nomination for election by
the Corporation’s stockholders was approved by a vote of at least two-thirds of the directors then
still in office who either were directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease for any reason to constitute at least a
majority of the members of the Board;

iii. Corporate Transactions. The effective date of a merger or consolidation of the
Corporation with any other entity, other than a merger or consolidation which would result in the
voting securities of the Corporation outstanding immediately prior to such merger or consolidation
continuing to represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity) more than 51% of the combined voting power of the voting securities of
the surviving entity outstanding immediately after such merger or consolidation and with the power
to elect at least a majority of the board of directors or other governing body of such surviving
entity;

 

-2-

 

iv. Liquidation. The approval by the stockholders of the Corporation of a complete
liquidation of the Corporation or an agreement for the sale or disposition by the Corporation of
all or substantially all of the Corporation’s assets; and

v. Other Events. There occurs any other event of a nature that would be required to be
reported in response to Item 6(e) of Schedule 14A of Regulation 14A (or a response to any similar
item on any similar schedule or form) promulgated under the Exchange Act (as defined below),
whether or not the Corporation is then subject to such reporting requirement.

For purposes of this Section 2(b), the following terms shall have the following meanings:

(A) “Exchange Act” shall mean the Securities Exchange Act of
1934, as amended from time to time.

(B) “Person” shall have the meaning as set forth in Sections
13(d) and 14(d) of the Exchange Act; provided, however, that Person
shall exclude (i) the Corporation, (ii) any trustee or other
fiduciary holding securities under an employee benefit plan of the
Corporation, and (iii) any corporation owned, directly or
indirectly, by the stockholders of the Corporation in substantially
the same proportions as their ownership of stock of the Corporation.

(C) “Beneficial Owner” shall have the meaning given to such
term in Rule 13d-3 under the Exchange Act; provided, however, that
Beneficial Owner shall exclude any Person otherwise becoming a
Beneficial Owner by reason of the stockholders of the Corporation
approving a merger of the Corporation with another entity.

(c) “Corporate Status” describes the status of a person who is or was a director, officer,
employee or agent of the Corporation or of any other corporation, limited liability company,
partnership or joint venture, trust, employee benefit plan or other enterprise which such person is
or was serving at the request of the Corporation.

(d) “Disinterested Director” means a director of the Corporation who is not and was not a
party to the Proceeding in respect of which indemnification is sought by Indemnitee.

(e) “Enterprise” shall mean the Corporation and any other corporation, limited liability
company, partnership, joint venture, trust, employee benefit plan or other enterprise of which
Indemnitee is or was serving at the request of the Corporation as a director, officer, employee,
agent or fiduciary.

(f) “Expenses” shall include all reasonable attorneys’ fees, retainers, court costs,
transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and
binding costs, telephone charges, postage, delivery service fees, any federal, state, local or
foreign taxes imposed on Indemnitee as a result of the actual or deemed receipt of any payments
under this Agreement, ERISA

 

-3-

 

excise taxes and penalties, and all other disbursements or expenses of the types customarily
incurred in connection with prosecuting, defending, preparing to prosecute or defend,
investigating, being or preparing to be a witness in, or otherwise participating in, a Proceeding.
Expenses also shall include (i) Expenses incurred in connection with any appeal resulting from any
Proceeding, including without limitation the premium, security for, and other costs relating to any
cost bond, supersedeas bond, or other appeal bond or its equivalent, and (ii) for purposes of
Section 14(d) only, Expenses incurred by Indemnitee in connection with the interpretation,
enforcement or defense of Indemnitee’s rights under this Agreement, by litigation or otherwise.
The parties agree that for the purposes of any advancement of Expenses for which Indemnitee has
made written demand to the Corporation in accordance with this Agreement, all Expenses included in
such demand that are certified by affidavit of Indemnitee’s counsel as being reasonable shall be
presumed conclusively to be reasonable. Expenses, however, shall not include amounts paid in
settlement by Indemnitee or the amount of judgments or fines against Indemnitee.

(g) “Independent Counsel” means a law firm, or a member of a law firm, that is experienced in
matters of corporation law and neither presently is, nor in the past five years has been, retained
to represent: (i) the Corporation or Indemnitee in any matter material to either such party (other
than with respect to matters concerning the Indemnitee under this Agreement, or of other
indemnitees under similar indemnification agreements), or (ii) any other party to the Proceeding
giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term
“Independent Counsel” shall not include any person who, under the applicable standards of
professional conduct then prevailing, would have a conflict of interest in representing either the
Corporation or Indemnitee in an action to determine Indemnitee’s rights under this Agreement. The
Corporation agrees to pay the reasonable fees and expenses of the Independent Counsel referred to
above and to fully indemnify such counsel against any and all Expenses, claims, liabilities and
damages arising out of or relating to this Agreement or its engagement pursuant hereto.

(h) The term “Proceeding” shall include any threatened, pending or completed action, suit,
arbitration, alternate dispute resolution mechanism, investigation, inquiry, administrative hearing
or any other actual, threatened or completed proceeding, whether brought in the right of the
Corporation or otherwise and whether of a civil, criminal, administrative, legislative, or
investigative (formal or informal) nature, including any appeal therefrom, in which Indemnitee was,
is or will be involved as a party, potential party, non-party witness or otherwise by reason of the
fact that Indemnitee is or was a director or officer of the Corporation, by reason of any action
taken by him or of any action on his part while acting as director or officer of the Corporation,
or by reason of the fact that he is or was serving at the request of the Corporation as a director,
officer, employee or agent of another corporation, limited liability company, partnership, joint
venture, trust or other enterprise, in each case whether or not serving in such capacity at the
time any liability or expense is incurred for which indemnification, reimbursement, or advancement
of expenses can be provided under this Agreement. If the Indemnitee believes in good faith that a
given situation may lead to or culminate in the institution of a Proceeding, this shall be
considered a Proceeding under this paragraph.

(i) Reference to “other enterprise” shall include employee benefit plans; references to
“fines” shall include any excise tax assessed with respect to any employee benefit plan; references
to “serving at the request of the Corporation” shall include any service as a director, officer,
employee or agent of the Corporation which imposes duties on, or involves services by, such
director, officer, employee or agent with respect to an employee benefit plan, its participants or
beneficiaries; and a person who acted in good faith and in a manner he reasonably believed to be in
the best interests of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in
manner “not opposed to the best interests of the Corporation” as referred to in this Agreement.

 

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Section 3. Indemnity in Third-Party Proceedings. The Corporation shall indemnify
Indemnitee in accordance with the provisions of this Section 3 if Indemnitee is, or is threatened
to be made, a party to or a participant in any Proceeding, other than a Proceeding by or in the
right of the Corporation to procure a judgment in its favor. Pursuant to this Section 3,
Indemnitee shall be indemnified to the fullest extent permitted by applicable law against all
Expenses, judgments, fines and amounts paid in settlement actually and reasonably incurred by
Indemnitee or on his behalf in connection with such Proceeding or any claim, issue or matter
therein, if Indemnitee acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the Corporation and, in the case of a criminal Proceeding had no
reasonable cause to believe that his conduct was unlawful. The parties hereto intend that this
Agreement shall provide to the fullest extent permitted by law for indemnification in excess of
that expressly permitted by statute, including, without limitation, any indemnification provided by
the Corporation’s Certificate of Incorporation, its Bylaws, vote of its stockholders or
disinterested directors or applicable law.

Section 4. Indemnity in Proceedings by or in the Right of the Corporation. The
Corporation shall indemnify Indemnitee in accordance with the provisions of this Section 4 if
Indemnitee is, or is threatened to be made, a party to or a participant in any Proceeding by or in
the right of the Corporation to procure a judgment in its favor. Pursuant to this Section 4,
Indemnitee shall be indemnified to the fullest extent permitted by applicable law against all
Expenses actually and reasonably incurred by him or on his behalf in connection with such
Proceeding or any claim, issue or matter therein, if Indemnitee acted in good faith and in a manner
he reasonably believed to be in or not opposed to the best interests of the Corporation. No
indemnification for Expenses shall be made under this Section 4 in respect of any claim, issue or
matter as to which Indemnitee shall have been finally adjudged by a court to be liable to the
Corporation, unless and only to the extent that the Delaware Court of Chancery or any court in
which the Proceeding was brought shall determine upon application that, despite the adjudication of
liability but in view of all the circumstances of the case, Indemnitee is fairly and reasonably
entitled to indemnification.

Section 5. Indemnification for Expenses of a Party Who is Wholly or Partly Successful.
Notwithstanding any other provisions of this Agreement, to the fullest extent permitted by
applicable law and to the extent that Indemnitee is a party to (or a participant in) and is
successful, on the merits or otherwise, in any Proceeding or in defense of any claim, issue or
matter therein, in whole or in part, the Corporation shall indemnify Indemnitee against all
Expenses actually and reasonably incurred by him in connection therewith. If Indemnitee is not
wholly successful in such Proceeding but is successful, on the merits or otherwise, as to one or
more but less than all claims, issues or matters in such Proceeding, the Corporation shall
indemnify Indemnitee against all Expenses actually and reasonably incurred by him or on his behalf
in connection with or related to each successfully resolved claim, issue or matter to the fullest
extent permitted by law. For purposes of this Section and without limitation, the termination of
any claim, issue or matter in such a Proceeding by dismissal, with or without prejudice, shall be
deemed to be a successful result as to such claim, issue or matter.

Section 6. Indemnification For Expenses of a Witness. Notwithstanding any other
provision of this Agreement, to the fullest extent permitted by applicable law and to the extent
that Indemnitee is, by reason of his Corporate Status, a witness or otherwise asked to participate
in any Proceeding to which Indemnitee is not a party, he shall be indemnified against all Expenses
actually and reasonably incurred by him or on his behalf in connection therewith.

 

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Section 7. Partial Indemnification. If Indemnitee is entitled under any provision of
this Agreement to indemnification by the Corporation for some or a portion of Expenses, but not,
however, for the total amount thereof, the Corporation shall nevertheless indemnify Indemnitee for
the portion thereof to which Indemnitee is entitled.

Section 8. Additional Indemnification.

(a) Notwithstanding any limitation in Sections 3, 4, or 5, the Corporation shall indemnify
Indemnitee to the fullest extent permitted by applicable law if Indemnitee is a party to or
threatened to be made a party to any Proceeding (including a Proceeding by or in the right of the
Corporation to procure a judgment in its favor) against all Expenses, judgments, fines and amounts
paid in settlement actually and reasonably incurred by Indemnitee in connection with the
Proceeding.

(b) For purposes of Section 8(a), the meaning of the phrase “to the fullest extent permitted
by applicable law” shall include, but not be limited to:

i. to the fullest extent permitted by the provision of the DGCL that authorizes or
contemplates additional indemnification by agreement, or the corresponding provision of any
amendment to or replacement of the DGCL, and

ii. to the fullest extent authorized or permitted by any amendments to or replacements of the
DGCL adopted after the date of this Agreement that increase the extent to which a corporation may
indemnify its officers and directors.

Section 9. Exclusions. Notwithstanding any provision in this Agreement, the
Corporation shall not be obligated under this Agreement to make any indemnity in connection with
any claim made against Indemnitee:

(a) for which payment has actually been made to or on behalf of Indemnitee under any insurance
policy or other indemnity provision, except with respect to any excess beyond the amount paid under
any insurance policy or other indemnity provision; or

(b) for (i) an accounting of profits made from the purchase and sale (or sale and purchase) by
Indemnitee of securities of the Corporation within the meaning of Section 16(b) of the Exchange Act
(as defined in Section 2(b) hereof) or similar provisions of state statutory law or common law, or
(ii) any reimbursement of the Corporation by the Indemnitee of any bonus or other incentive-based
or equity-based compensation or of any profits realized by the Indemnitee from the sale of
securities of the Corporation, as required in each case under the Exchange Act (including any such
reimbursements that arise from an accounting restatement of the Corporation pursuant to Section 304
of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), or the payment to the Corporation of
profits arising from the purchase and sale by Indemnitee of securities in violation of Section 306
of the Sarbanes-Oxley Act); or

(c) except as provided in Section 14(d) of this Agreement, in connection with any Proceeding
(or any part of any Proceeding) initiated by Indemnitee, including any Proceeding (or any part of
any Proceeding) initiated by Indemnitee against the Corporation or its directors, officers,
employees or other indemnitees, unless (i) the Board authorized the Proceeding (or any part of any
Proceeding) prior to its initiation or (ii) the Corporation provides the indemnification, in its
sole discretion, pursuant to the powers vested in the Corporation under applicable law, provided,
however, that this prohibition shall not apply to any counter-claim, cross-claim or third-party claim brought against the Indemnitee in
any Proceeding.

 

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Section 10. Advances of Expenses. In accordance with the pre-existing requirement of
Section 11.1 of Article XI of the By-laws of the Corporation, and notwithstanding any provision of
this Agreement to the contrary, the Corporation shall advance, to the extent not prohibited by law,
the Expenses incurred by Indemnitee in connection with any Proceeding, and such advancement shall
be made within thirty (30) days after the receipt by the Corporation of a statement or statements
requesting such advances from time to time, whether prior to or after final disposition of any
Proceeding. Advances shall be unsecured and interest free. Advances shall be made without regard
to Indemnitee’s ability to repay the Expenses and without regard to Indemnitee’s ultimate
entitlement to indemnification under the other provisions of this Agreement. Advances shall
include any and all reasonable Expenses incurred pursuing an action to enforce this right of
advancement, including Expenses incurred preparing and forwarding statements to the Corporation to
support the advances claimed. The Indemnitee shall qualify for advances upon the execution and
delivery to the Corporation of this Agreement, which shall constitute an undertaking providing that
the Indemnitee undertakes to repay the amounts advanced (without interest) to the extent that it is
ultimately determined that Indemnitee is not entitled to be indemnified by the Corporation. No
other form of undertaking shall be required other than the execution of this Agreement. This
Section 10 shall not apply to any claim made by Indemnitee for which indemnity is excluded pursuant
to Section 9.

Section 11. Procedure for Notification and Defense of Claim.

(a) Indemnitee shall notify the Corporation in writing of any matter with respect to which
Indemnitee intends to seek indemnification or advancement of Expenses hereunder as soon as
reasonably practicable following the receipt by Indemnitee of written notice thereof. The written
notification to the Corporation shall include a description of the nature of the Proceeding and the
facts underlying the Proceeding. To obtain indemnification under this Agreement, Indemnitee shall
submit to the Corporation a written request, including therein or therewith such documentation and
information as is reasonably available to Indemnitee and is reasonably necessary to determine
whether and to what extent Indemnitee is entitled to indemnification following the final
disposition of such action, suit or proceeding. The omission by Indemnitee to notify the
Corporation hereunder will not relieve the Corporation from any liability which it may have to
Indemnitee hereunder or otherwise than under this Agreement, and any delay in so notifying the
Corporation shall not constitute a waiver by Indemnitee of any rights under this Agreement. The
Secretary of the Corporation shall, promptly upon receipt of such a request for indemnification,
advise the Board in writing that Indemnitee has requested indemnification.

(b) The Corporation will be entitled to participate in the Proceeding at its own expense.

Section 12. Procedure Upon Application for Indemnification.

(a) Upon written request by Indemnitee for indemnification pursuant to Section 11(a), a
determination, if required by applicable law, with respect to Indemnitee’s entitlement thereto
shall be made in the specific case: (i) if a Change in Control shall have occurred, by Independent
Counsel in a written opinion to the Board, a copy of which shall be delivered to Indemnitee; or
(ii) if a Change in Control shall not have occurred, (A) by a majority vote of the Disinterested
Directors, even though less than a quorum of the Board, (B) by a committee of Disinterested
Directors designated by a majority vote of the Disinterested Directors, even though less than a
quorum of the Board, (C) if there are no such

 

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Disinterested Directors or, if such Disinterested Directors so direct, by Independent Counsel
in a written opinion to the Board, a copy of which shall be delivered to Indemnitee or (D) if so
directed by the Board, by the stockholders of the Corporation; and, if it is so determined that
Indemnitee is entitled to indemnification, payment to Indemnitee shall be made within ten (10) days
after such determination. Indemnitee shall cooperate with the person, persons or entity making
such determination with respect to Indemnitee’s entitlement to indemnification, including providing
to such person, persons or entity upon reasonable advance request any documentation or information
which is not privileged or otherwise protected from disclosure and which is reasonably available to
Indemnitee and reasonably necessary to such determination. Any costs or Expenses (including
attorneys’ fees and disbursements) incurred by Indemnitee in so cooperating with the person,
persons or entity making such determination shall be borne by the Corporation (irrespective of the
determination as to Indemnitee’s entitlement to indemnification) and the Corporation hereby
indemnifies and agrees to hold Indemnitee harmless therefrom.

(b) In the event the determination of entitlement to indemnification is to be made by
Independent Counsel pursuant to Section 12(a) hereof, the Independent Counsel shall be selected as
provided in this Section 12(b). If a Change in Control shall not have occurred, the Independent
Counsel shall be selected by the Board, and the Corporation shall give written notice to Indemnitee
advising him of the identity of the Independent Counsel so selected. If a Change in Control shall
have occurred, the Independent Counsel shall be selected by Indemnitee (unless Indemnitee shall
request that such selection be made by the Board, in which event the preceding sentence shall
apply), and Indemnitee shall give written notice to the Corporation advising it of the identity of
the Independent Counsel so selected. In either event, Indemnitee or the Corporation, as the case
may be, may, within ten (10) days after such written notice of selection shall have been given,
deliver to the Corporation or to Indemnitee, as the case may be, a written objection to such
selection; provided, however, that such objection may be asserted only on the
ground that the Independent Counsel so selected does not meet the requirements of “Independent
Counsel” as defined in Section 2 of this Agreement, and the objection shall set forth with
particularity the factual basis of such assertion. Absent a proper and timely objection, the
person so selected shall act as Independent Counsel. If such written objection is so made and
substantiated, the Independent Counsel so selected may not serve as Independent Counsel unless and
until such objection is withdrawn or a court has determined that such objection is without merit.
If, within twenty (20) days after the later of submission by Indemnitee of a written request for
indemnification pursuant to Section 11(a) hereof and the final disposition of the Proceeding, no
Independent Counsel shall have been selected and not objected to, either the Corporation or
Indemnitee may petition a court of competent jurisdiction for resolution of any objection which
shall have been made by the Corporation or Indemnitee to the other’s selection of Independent
Counsel and/or for the appointment as Independent Counsel of a person selected by the Court or by
such other person as the Court shall designate, and the person with respect to whom all objections
are so resolved or the person so appointed shall act as Independent Counsel under Section 12(a)
hereof. Upon the due commencement of any judicial proceeding or arbitration pursuant to Section
14(a) of this Agreement, Independent Counsel shall be discharged and relieved of any further
responsibility in such capacity (subject to the applicable standards of professional conduct then
prevailing).

Section 13. Presumptions and Effect of Certain Proceedings.

(a) In making a determination with respect to entitlement to indemnification hereunder, the
person or persons or entity making such determination shall, to the fullest extent not prohibited
by law, presume that Indemnitee is entitled to indemnification under this Agreement if Indemnitee
has submitted a request for indemnification in accordance with Section 11(a) of this Agreement, and
the Corporation shall, to the fullest extent not prohibited by law, have the burden of proof

 

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to overcome that presumption in connection with the making by any person, persons or entity of
any determination contrary to that presumption. Neither the failure of the Corporation (including
by its directors or independent legal counsel) to have made a determination prior to the
commencement of any action pursuant to this Agreement that indemnification is proper in the
circumstances because Indemnitee has met the applicable standard of conduct, nor an actual
determination by the Corporation (including by its directors or independent legal counsel) that
Indemnitee has not met such applicable standard of conduct, shall be a defense to the action or
create a presumption that Indemnitee has not met the applicable standard of conduct.

(b) Subject to Section 14(e), if the person, persons or entity empowered or selected under
Section 12 of this Agreement to determine whether Indemnitee is entitled to indemnification shall
not have made a determination within sixty (60) days after receipt by the Corporation of the
request therefor, the requisite determination of entitlement to indemnification shall, to the
fullest extent not prohibited by law, be deemed to have been made and Indemnitee shall be entitled
to such indemnification, absent (i) a misstatement by Indemnitee of a material fact, or an omission
of a material fact necessary to make Indemnitee’s statement not materially misleading, in
connection with the request for indemnification, or (ii) a prohibition of such indemnification
under applicable law; provided, however, that such 60-day period may be extended for a reasonable
time, not to exceed an additional thirty (30) days, if the person, persons or entity making the
determination with respect to entitlement to indemnification in good faith requires such additional
time for the obtaining or evaluating of documentation and/or information relating thereto; and
provided, further, that the foregoing provisions of this Section 13(b) shall not apply (i) if the
determination of entitlement to indemnification is to be made by the stockholders pursuant to
Section 12(a) of this Agreement and if (A) within fifteen (15) days after receipt by the
Corporation of the request for such determination the Board has resolved to submit such
determination to the stockholders for their consideration at an annual meeting thereof to be held
within seventy-five (75) days after such receipt and such determination is made thereat, or (B) a
special meeting of stockholders is called within fifteen (15) days after such receipt for the
purpose of making such determination, such meeting is held for such purpose within sixty (60) days
after having been so called and such determination is made thereat, or (ii) if the determination of
entitlement to indemnification is to be made by Independent Counsel pursuant to Section 12(a) of
this Agreement.

(c) The termination of any Proceeding or of any claim, issue or matter therein, by judgment,
order, settlement or conviction, or upon a plea of nolo contendere or its
equivalent, shall not (except as otherwise expressly provided in this Agreement) of itself
adversely affect the right of Indemnitee to indemnification or create a presumption that Indemnitee
did not act in good faith and in a manner which he reasonably believed to be in or not opposed to
the best interests of the Corporation or, with respect to any criminal Proceeding, that Indemnitee
had reasonable cause to believe that his conduct was unlawful.

(d) Reliance as Safe Harbor. For purposes of any determination of good faith,
Indemnitee shall be deemed to have acted in good faith if Indemnitee’s action is based on the
records or books of account of the Enterprise, including financial statements, or on information
supplied to Indemnitee by the officers of the Enterprise in the course of their duties, or on the
advice of legal counsel for the Enterprise or on information or records given or reports made to
the Enterprise by an independent certified public accountant or by an appraiser or other expert
selected with the reasonable care by the Enterprise. The provisions of this Section 13(d) shall
not be deemed to be exclusive or to limit in any way the other circumstances in which the
Indemnitee may be deemed to have met the applicable standard of conduct set forth in this
Agreement.

 

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(e) Actions of Others. The knowledge and/or actions, or failure to act, of any
director, officer, agent or employee of the Enterprise shall not be imputed to Indemnitee for
purposes of determining the right to indemnification under this Agreement.

Section 14. Remedies of Indemnitee.

(a) Subject to Section 14(e), in the event that (i) a determination is made pursuant to
Section 12 of this Agreement that Indemnitee is not entitled to indemnification under this
Agreement, (ii) advancement of Expenses is not timely made pursuant to Section 10 of this
Agreement, (iii) no determination of entitlement to indemnification shall have been made pursuant
to Section 12(a) of this Agreement within ninety (90) days after receipt by the Corporation of the
request for indemnification, (iv) payment of indemnification is not made pursuant to Section 5, 6
or 7 or the last sentence of Section 12(a) of this Agreement within ten (10) days after receipt by
the Corporation of a written request therefor, (v) payment of indemnification pursuant to Section
3, 4 or 8 of this Agreement is not made within ten (10) days after a determination has been made
that Indemnitee is entitled to indemnification, or (vi) in the event that the Corporation or any
other person takes or threatens to take any action to declare this Agreement void or unenforceable,
or institutes any litigation or other action or Proceeding designed to deny, or to recover from,
the Indemnitee the benefits provided or intended to be provided to the Indemnitee hereunder,
Indemnitee shall be entitled to an adjudication by a court of his entitlement to such
indemnification or advancement of Expenses. Alternatively, Indemnitee, at his option, may seek an
award in arbitration to be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. Indemnitee shall commence such proceeding seeking
an adjudication or an award in arbitration within 180 days following the date on which Indemnitee
first has the right to commence such proceeding pursuant to this Section 14(a); provided,
however, that the foregoing clause shall not apply in respect of a proceeding brought by
Indemnitee to enforce his rights under Section 5 of this Agreement. The Corporation shall not
oppose Indemnitee’s right to seek any such adjudication or award in arbitration.

(b) In the event that a determination shall have been made pursuant to Section 12(a) of this
Agreement that Indemnitee is not entitled to indemnification, any judicial proceeding or
arbitration commenced pursuant to this Section 14 shall be conducted in all respects as a
de novo trial, or arbitration, on the merits and Indemnitee shall not be prejudiced
by reason of that adverse determination. In any judicial proceeding or arbitration commenced
pursuant to this Section 14 the Corporation shall have the burden of proving Indemnitee is not
entitled to indemnification or advancement of Expenses, as the case may be.

(c) If a determination shall have been made pursuant to Section 12(a) of this Agreement that
Indemnitee is entitled to indemnification, the Corporation shall be bound by such determination in
any judicial proceeding or arbitration commenced pursuant to this Section 14, absent (i) a
misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make
Indemnitee’s statement not materially misleading, in connection with the request for
indemnification, or (ii) a prohibition of such indemnification under applicable law.

(d) The Corporation shall, to the fullest extent not prohibited by law, be precluded from
asserting in any judicial proceeding or arbitration commenced pursuant to this Section 14 that the
procedures and presumptions of this Agreement are not valid, binding and enforceable and shall
stipulate in any such court or before any such arbitrator that the Corporation is bound by all the
provisions of this Agreement. It is the intent of the Corporation that, to the fullest extent
permitted by law, the Indemnitee not be required to incur legal fees or other Expenses associated
with the interpretation, enforcement or

 

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defense of Indemnitee’s rights under this Agreement by litigation or otherwise because the
cost and expense thereof would substantially detract from the benefits intended to be extended to
the Indemnitee hereunder. The Corporation shall, to the fullest extent permitted by law, indemnify
Indemnitee against any and all Expenses and, if requested by Indemnitee, shall (within ten (10)
days after receipt by the Corporation of a written request therefor) advance, to the extent not
prohibited by law, such Expenses to Indemnitee, which are incurred by Indemnitee in connection with
any action brought by Indemnitee for indemnification or advance of Expenses from the Corporation
under this Agreement or under any directors’ and officers’ liability insurance policies maintained
by the Corporation if Indemnitee is wholly successful on the underlying claims; if Indemnitee is
not wholly successful on the underlying claims, then such indemnification and advancement shall be
only to the extent Indemnitee is successful on such underlying claims or otherwise as permitted by
law, whichever is greater.

(e) Notwithstanding anything in this Agreement to the contrary, no determination as to
entitlement of Indemnitee to indemnification under this Agreement shall be required to be made
prior to the final disposition of the Proceeding.

Section 15. Non-exclusivity; Survival of Rights; Insurance; Subrogation.

(a) The rights of indemnification and to receive advancement of Expenses as provided by this
Agreement shall not be deemed exclusive of any other rights to which Indemnitee may at any time be
entitled under applicable law, the Corporation’s Certificate of Incorporation, the Corporation’s
By-laws, any agreement, a vote of stockholders or a resolution of directors, or otherwise. No
amendment, alteration or repeal of this Agreement or of any provision hereof shall limit or
restrict any right of Indemnitee under this Agreement in respect of any action taken or omitted by
such Indemnitee in his Corporate Status prior to such amendment, alteration or repeal. To the
extent that a change in Delaware law, whether by statute or judicial decision, permits greater
indemnification or advancement of Expenses than would be afforded currently under the Corporation’s
By-laws and this Agreement, it is the intent of the parties hereto that Indemnitee shall enjoy by
this Agreement the greater benefits so afforded by such change. No right or remedy herein
conferred is intended to be exclusive of any other right or remedy, and every other right and
remedy shall be cumulative and in addition to every other right and remedy given hereunder or now
or hereafter existing at law or in equity or otherwise. The assertion or employment of any right
or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any
other right or remedy.

(b) To the extent that the Corporation maintains an insurance policy or policies providing
liability insurance for directors, officers, employees, or agents of the Corporation or of any
other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise
which such person serves at the request of the Corporation, Indemnitee shall be covered by such
policy or policies in accordance with its or their terms to the maximum extent of the coverage
available for any such director, officer, employee or agent under such policy or policies. If, at
the time of the receipt of a notice of a claim pursuant to the terms hereof, the Corporation has
director and officer liability insurance in effect, the Corporation shall give prompt notice of
such claim or of the commencement of a proceeding, as the case may be, to the insurers in
accordance with the procedures set forth in the respective policies. The Corporation shall
thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of the
Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of such
policies.

(c) In the event of any payment under this Agreement, the Corporation shall be subrogated to
the extent of such payment to all of the rights of recovery of Indemnitee, who shall execute all papers required and take all action necessary to secure such rights, including execution
of such documents as are necessary to enable the Corporation to bring suit to enforce such rights.

 

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(d) The Corporation shall not be liable under this Agreement to make any payment of amounts
otherwise indemnifiable (or for which advancement is provided hereunder) hereunder if and to the
extent that Indemnitee has otherwise actually received such payment under any insurance policy,
contract, agreement or otherwise.

(e) The Corporation’s obligation to indemnify or advance Expenses hereunder to Indemnitee who
is or was serving at the request of the Corporation as a director, officer, employee or agent of
any other corporation, limited liability company, partnership, joint venture, trust, employee
benefit plan or other enterprise shall be reduced by any amount Indemnitee has actually received as
indemnification or advancement of Expenses from such other corporation, limited liability company,
partnership, joint venture, trust, employee benefit plan or other enterprise.

Section 16. Duration of Agreement. This Agreement shall continue until and terminate
upon the later of: (a) ten (10) years after the date that Indemnitee shall have ceased to serve as
a director of the Corporation or, at the request of the Corporation, as a director, officer,
employee, or agent of another corporation, partnership, joint venture, trust, employee benefit plan
or other enterprise or (b) one (1) year after the final termination of any Proceeding then pending
in respect of which Indemnitee is granted rights of indemnification or advancement of Expenses
hereunder and of any proceeding commenced by Indemnitee pursuant to Section 14 of this Agreement
relating thereto. This Agreement shall be binding upon the Corporation and its successors and
assigns and shall inure to the benefit of Indemnitee and his heirs, executors and administrators.

Section 17. Severability. If any provision or provisions of this Agreement shall be
held to be invalid, illegal or unenforceable for any reason whatsoever: (a) the validity, legality
and enforceability of the remaining provisions of this Agreement (including without limitation,
each portion of any Section of this Agreement containing any such provision held to be invalid,
illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall not in any
way be affected or impaired thereby and shall remain enforceable to the fullest extent permitted by
law; (b) such provision or provisions shall be deemed reformed to the extent necessary to conform
to applicable law and to give the maximum effect to the intent of the parties hereto; and (c) to
the fullest extent possible, the provisions of this Agreement (including, without limitation, each
portion of any Section of this Agreement containing any such provision held to be invalid, illegal
or unenforceable, that is not itself invalid, illegal or unenforceable) shall be construed so as to
give effect to the intent manifested thereby.

Section 18. Enforcement.

(a) The Corporation expressly confirms and agrees that it has entered into this Agreement and
assumed the obligations imposed on it hereby in order to induce Indemnitee to serve as a director
of the Corporation, and the Corporation acknowledges that Indemnitee is relying upon this Agreement
in serving as a director or officer of the Corporation.

(b) This Agreement constitutes the entire agreement between the parties hereto with respect to
the subject matter hereof and supersedes all prior agreements and understandings, oral, written and
implied, between the parties hereto with respect to the subject matter hereof; provided, however,
that this Agreement is a supplement to and in furtherance of the Certificate of Incorporation of
the Corporation, the By-laws of the Corporation and applicable law, and shall not be deemed a
substitute therefor, nor to diminish or abrogate any rights of Indemnitee thereunder.

 

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Section 19. Modification and Waiver. No supplement, modification or amendment of this
Agreement shall be binding unless executed in writing by the parties thereto. No waiver of any of
the provisions of this Agreement shall be deemed or shall constitute a waiver of any other
provisions of this Agreement nor shall any waiver constitute a continuing waiver.

Section 20. Notice by Indemnitee. Indemnitee agrees promptly to notify the
Corporation in writing upon being served with any summons, citation, subpoena, complaint,
indictment, information or other document relating to any Proceeding or matter which may be subject
to indemnification or advancement of Expenses covered hereunder. The failure of Indemnitee to so
notify the Corporation shall not relieve the Corporation of any obligation which it may have to the
Indemnitee under this Agreement or otherwise.

Section 21. Notices. All notices, requests, demands and other communications under
this Agreement shall be in writing and shall be deemed to have been duly given if (a) delivered by
hand and receipted for by the party to whom said notice or other communication shall have been
directed, (b) mailed by certified or registered mail with postage prepaid, on the third business
day after the date on which it is so mailed, (c) mailed by reputable overnight courier and
receipted for by the party to whom said notice or other communication shall have been directed or
(d) sent by facsimile transmission, with receipt of oral confirmation that such transmission has
been received:

(a) If to Indemnitee, at the address indicated on the signature page of this Agreement, or
such other address as Indemnitee shall provide to the Corporation.

(b) If to the Corporation to

Quanex Building Products Corporation

Attention: General Counsel and Secretary

1900 West Loop South, Suite 1500

Houston, Texas 77027

or to any other address as may have been furnished to Indemnitee by the Corporation.

Section 22. Contribution. To the fullest extent permissible under applicable law, if
the indemnification provided for in this Agreement is unavailable to Indemnitee for any reason
whatsoever, the Corporation, in lieu of indemnifying Indemnitee, shall contribute to the amount
incurred by Indemnitee, whether for judgments, fines, penalties, excise taxes, amounts paid or to
be paid in settlement and/or for Expenses, in connection with any claim relating to an
indemnifiable event under this Agreement, in such proportion as is deemed fair and reasonable in
light of all of the circumstances of such Proceeding in order to reflect (i) the relative benefits
received by the Corporation and Indemnitee as a result of the event(s) and/or transaction(s) giving
cause to such Proceeding; and/or (ii) the relative fault of the Corporation (and its directors,
officers, employees and agents) and Indemnitee in connection with such event(s) and/or
transaction(s).

 

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Section 23. Applicable Law and Consent to Jurisdiction. This Agreement and the legal
relations among the parties shall be governed by, and construed and enforced in accordance with,
the laws of the State of Delaware, without regard to its conflict of laws rules. Except with
respect to any arbitration commenced by Indemnitee pursuant to Section 14(a) of this Agreement, the Corporation and
Indemnitee hereby irrevocably and unconditionally (i) agree that any action or proceeding arising
out of or in connection with this Agreement shall be brought only in the Chancery Court of the
State of Delaware (the “Delaware Court”), and not in any other state or federal court in the United
States of America or any court in any other country, (ii) consent to submit to the exclusive
jurisdiction of the Delaware Court for purposes of any action or proceeding arising out of or in
connection with this Agreement, (iii) appoint, to the extent such party is not otherwise subject to
service of process in the State of Delaware, irrevocably                                          as its agent
in the State of Delaware as such party’s agent for acceptance of legal process in connection with
any such action or proceeding against such party with the same legal force and validity as if
served upon such party personally within the State of Delaware, (iv) waive any objection to the
laying of venue of any such action or proceeding in the Delaware Court, and (v) waive, and agree
not to plead or to make, any claim that any such action or proceeding brought in the Delaware Court
has been brought in an improper or inconvenient forum.

Section 24. Identical Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall for all purposes be deemed to be an original but all of which
together shall constitute one and the same Agreement. Only one such counterpart signed by the
party against whom enforceability is sought needs to be produced to evidence the existence of this
Agreement.

Section 25. Miscellaneous. Use of the masculine pronoun shall be deemed to include
usage of the feminine pronoun where appropriate. The headings of this Agreement are inserted for
convenience only and shall not be deemed to constitute part of this Agreement or to affect the
construction thereof.

IN WITNESS WHEREOF, the parties have caused this Agreement to be signed as of the day and year
first above written.

	 	 	 	 	 	 	 	 	 
	QUANEX BUILDING PRODUCTS	 	 	 	INDEMNITEE
	CORPORATION	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	By:
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	Name:

	 	 	 	 	 	Name:	 	 
	Title:

	 	 	 	 	 	Address:	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 

 

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