Document:

Scale Up and Commercial Supply Agreement

 Exhibit 10.1 
  
 SCALE UP AND COMMERCIAL SUPPLY AGREEMENT 
  
 This Scale Up and Commercial Supply Agreement (the “Agreement”) is entered into as of November 16th, 2005 (the “Effective Date”) between Corium International, Inc., a Delaware corporation, with its principal place of business at 2686
Middlefield Road, Suite G, Redwood City, CA 94063 (“Corium”) and Adolor Corporation, a Delaware corporation with offices at 700 Pennsylvania Drive, Exton, PA 19341 (“Adolor”) (each, a “Party” and
collectively, the “Parties”). 
  
 WHEREAS Adolor and
Corium are parties to a Product Development and Clinical Supply Agreement dated October 15, 2003, and any agreed upon amendments or scope changes thereto (the “2003 Agreement”) relating to the development and clinical supply of
a sterile lidocaine patch; 
  
 WHEREAS pursuant to the binding Letter of
Intent between the Parties executed September 16, 2005 (the “LOI”), Corium will supply a Rx/non-OTC (unless and until the patch undergoes an Rx to OTC switch), passive, sterile lidocaine patch (the “Patch”) for human
use for pain from closed wounds;  
  
 WHEREAS upon the successful
scale up of the Patches, Adolor desires to have Corium supply it with such Patches, and Corium desires to supply such Patches to Adolor. 
  
 NOW, THEREFORE, in consideration of the above premises and mutual covenants hereinafter contained, and for other good and valuable consideration the sufficiency of
which is hereby acknowledged, and intending to be legally bound hereby, Corium and Adolor agree as follows: 
  
 1. DEFINITIONS. 
  
 1.1 “Adolor Background Technology” means all inventions or intellectual property rights that are owned, either partially or wholly, by Adolor, as of the Effective Date of this Agreement. 
  
 1.2 “Batch” shall mean a production lot containing
approximately [**] individual Patches of uniform character and quality, within specified acceptance criteria, the amount of which will be mutually agreed to by the Parties upon the successful scale-up of the Patches. 
  
 1.3 “Corium Background Technology” means all
inventions or intellectual property rights that are owned, either partially or wholly, by Corium, as of the Effective Date of this Agreement. 
  
 1.4 “Corium Know-How” shall mean confidential information and materials owned by Corium, (other than Adolor Confidential
Information, which is information that is owned by Adolor or licensed by Adolor from third parties) that relate to the Patches, including technical knowledge, expertise, skill, practice, inventions, trade secrets, analytical methodology,
manufacturing knowledge, drawings, specifications, processes, techniques, samples, specimens, 

  

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prototypes, designs, research and development results, and other technical and scientific information for the development and marketing of Patches under the
foregoing license. 
  
 1.5 “Corium
Patent(s)” shall mean those Corium patents solely owned by Corium that are filed by Corium or issued during the Term which in the absence of a license to Adolor, would be infringed by the sale, use, offer for sale, import, or manufacture of
Patches in North America, provided, however, that if Corium is acquired, in no event will Corium Patents include the patents of Corium’s successor or acquirer. 
  
 1.6 “Current Good Manufacturing Practices” or “cGMP” means the then United States
current good manufacturing practices and standards as required by applicable Regulatory Authorities for the manufacture, testing, release, packaging and/or distribution of the Patches, and subject to any arrangements, additions or clarifications
agreed from time to time between the Parties in the Quality Agreement. 
  
 1.7 “Development Failure” shall mean Corium’s material, uncured failure to fulfill its development obligations under this Agreement. 
  
 1.8 “Deliverable Documents” shall mean the documents described in Exhibit A. 
  
 1.9 “FDA” means the United States Food and Drug
Administration and any successor thereto. 
  
 1.10
“Intellectual Property Rights” mean all intellectual property rights worldwide arising under statutory or common law, whether or not perfected, including all (i) patents and patent applications, and any substitutions,
divisions, continuations, continuations-in-part, reissues, renewals, registrations, confirmations, re-examinations, extensions, supplementary protection certificates and the like, and provisional applications, of any such patents or patent
application, and any foreign or international equivalent of any of the foregoing; (ii) rights associated with works of authorship including copyrights, copyright applications, copyright registrations; (iii) rights relating to the
protection of trade secrets and confidential information; (iv) rights analogous to those specifically set forth in this definition and any other proprietary rights relating to intellectual property (other than trademark, trade dress, or service
mark rights); and (v) Know-how. 
  
 1.11
“Know-how” shall mean confidential and/or proprietary technical information, techniques, processes, methods, data, substances and materials, and other information in a Party’s possession that is not generally available to the
public. 
  
 1.12 “NDA” shall mean a New
Drug Application filed or to be filed with the U.S. Food and Drug Administration. 
  
 1.13 “Passive” shall mean drug transport through skin by means of passive diffusion transport principles with drug concentration gradient (as opposed to drug delivery through alteration of the
biological barrier by physical means or by the addition of energy from other sources, i.e., microneedles, iontophoresis, sonophoresis, etc.) as the driving force for transport. 
  

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 1.14 “Patch” shall mean a Rx/non-OTC (unless and until the Patch undergoes an Rx
to OTC switch), Passive, sterile lidocaine patch for human use for pain from closed wounds as described in Exhibit B (Specifications). 
  
 1.15 “Patch Launch” shall mean the first date Adolor begins selling the Patches commercially. 
  
 1.16 “Processing Activities” shall mean the
manufacturing, processing, product release testing, and other activities undertaken or required to be undertaken by Corium in order to manufacture and supply Adolor with the Patches. 
  
 1.17 “Processing Facility” shall mean the Corium facility located at 4558 50th Street SE, Grand Rapids, MI 49512 at which Processing Activities shall occur. 
  
 1.18 “Purchase Orders” means purchase orders issued
by Adolor to Corium in accordance with the terms set forth in Section 3.7. 
  
 1.19 “Regulatory Approval” means any and all approvals, licenses, registrations or authorizations of any Regulatory Authority required to allow the manufacture and sale of any Patches.

  
 1.20 “Regulatory Authority” means any
applicable supra-national, federal, national, regional, state, provincial or local regulatory agencies, departments, bureaus, commissions, councils or other government entities regulating or otherwise exercising authority with respect to the
Patches. 
  
 1.21 “Regulatory Standards”
means (i) any and all permits, licenses, filings and certifications required by the FDA or other Regulatory Authorities, and compliance with cGMPs, applicable to any Processing Activity or Processing Facility, and (ii) any laws (including
the Environmental Protection Agency (EPA), the Drug Enforcement Administration (DEA), and the Occupational Safety and Health Administration (OSHA)), that apply to any Processing Activity or Processing Facility. 
  
 1.22 “Sale” means the act of selling, leasing or
otherwise transferring, providing, or furnishing for any consideration. Correspondingly, “Sell” means to make or cause to be made a Sale and “Sold” means to have made or caused to be made a Sale. 
  
 1.23 “Specifications” means the written
specifications set forth in Exhibit B (as they are amended in accordance with Section 3.4 from time to time) that describe the specific requirements and instructions for the production (including quality standards and testing methods), storage,
packaging, shipment of the Patches [**] and in accordance with cGMP requirements. 
  
 1.24 “Territory” shall mean North America. 
  

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 2. DEVELOPMENT. 
  
 2.1 The Development Program. The Parties have agreed to collaboratively engage in scale up activities for the Patches in accordance with the
terms and conditions set forth herein (the “Development Program”). 
  
 2.1.1 Deliverables. Under the Development Program, Corium shall develop the Deliverable Documents (as described in Exhibit
A) and perform the activities set forth in such Exhibit in accordance with the terms of this Agreement. 
  
 2.1.2 Deliverables and Timeline. Throughout the Term of the Agreement, Corium shall provide each of the Deliverables to
Adolor in accordance with the project timeline set forth in Exhibit C and any revisions to the project timeline that may be mutually agreed by the Parties (the “Timeline”). Corium shall not be liable for any delays or failure to
meet milestones set forth in the Timeline that are caused by Adolor. To the extent that Adolor fails to provide Corium with the information or resources that Adolor is obligated to provide under this Agreement, Corium shall to the extent that Corium
has not previously informed Adolor of its lack of such information or resources: (i) notify Adolor of such required information and resources as soon as such failure comes to Corium’s attention, and (ii) reassume responsibility for
its subsequent delays or failures to the extent that such subsequent delays or failures were not caused by Adolor. 
  
 2.1.3 Joint Steering Committee. 
  
 2.1.3.1 Purpose. A joint supervisory committee will be established to oversee the Development Program (the “Joint
Steering Committee”). The duties of the Joint Steering Committee will include, but not be limited to, the following: 
  
 (i) general oversight of all aspects of the Development Program; 
  
 (ii) development and approval of any revisions to budgets; 
  
 (iii) revision of the Timeline if the estimated timing
schedule for the development of a Patch has not been followed or must be revised; 
  
 (iv) initial forum for the resolution of disputes arising under this Agreement; and 
  
 (v) review of the progress of the development effort
against timelines and deliverables set forth in Exhibits C and A. 
  
 2.1.3.2 Membership. The Joint Steering Committee will be comprised of three (3) employees from Corium and three (3) employees from Adolor. A Party’s members of the Joint Steering Committee
will be appointed by the Party at its sole discretion. Substitute employees may be appointed at any time. The Parties will appoint their respective members of the Joint Steering Committee, and each Party will disclose such members to the other Party
in writing, promptly after the Effective Date. If the Joint Steering Committee is unable to reach agreement on a matter, within 10 business days the matter will be submitted for resolution to the President or CEO of Corium and the President or CEO
of Adolor. 
  

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 2.1.3.3 Meetings. The Joint Steering Committee will meet quarterly, on a
mutually agreeable date and time to review the items set forth in Section 2.1.3.1. Representatives of either Party, or both, in addition to members of the Joint Steering Committee, may attend such meetings at the invitation of either Party. The
Joint Steering Committee may hold meetings by teleconference or videoconference. 
  
 2.1.3.4 Records. Records will be kept of all significant decisions of the Joint Steering Committee, such as decisions
regarding budgets, will be reflected in written minutes of meetings that will be circulated by Corium to all Joint Steering Committee members for review and comment before being filed as final records of the Joint Steering Committee. 
  
 2.1.4 Project Contacts. Corium and Adolor will
designate, each in its sole discretion, and provide to the other, a list of project managers with knowledge of various aspects of the Development Program to whom the other Party shall direct all communications with respect to such aspects of the
Development Program and this Agreement. 
  
 2.1.5 Development Patch Testing. Corium will issue a Certificate of Analysis (“CofA”) and Certificate of Compliance (“CofC”) and executed batch records and will send such documents to Adolor for their
approval. Adolor will have [**] days from receipt of such documents to review them. Once Adolor approves the CofA and CofC, Corium will release the Patches to Adolor. If Adolor chooses to do acceptance testing by a qualified independent
laboratory at its expense, Adolor shall commence any such testing within [**] days of its receipt of the CofA and CofC. In the event that Adolor notifies Corium in writing of any nonconformity of the Patches from the Specifications within thirty
(30) days of its receipt of the CofA and CofC , Corium will have thirty (30) days from Corium’s receipt of such notice to investigate the nonconformities and Adolor will ensure that Corium is provided with access to, and information
from, the laboratory who claimed that the Patches were nonconforming, including such laboratory’s test methods and results. If Corium’s investigation demonstrates to Adolor that such Patches meet the Specifications, Adolor shall reimburse
Corium for all costs incurred by Corium in connection with such investigation, including Corium’s labor costs and any other costs. If the Patches do not conform to the Specifications, then Corium shall pay to Adolor [**], and Corium shall have
[**] days to cure such default (the “Cure Period”). If Corium is unable to cure such default during the Cure Period, then Adolor may, in addition to any other remedies that it may have, terminate this Agreement in whole or in part for
Corium’s material, uncured default without any further obligation or liability of any kind. For the avoidance of doubt, and not in limitation of the foregoing, Corium shall be responsible for the cost of batches of Patches that fail to meet the
Specifications if such failure was caused by Corium’s: (i) negligence, (ii) failure to follow Regulatory Standards, or (iii) failure to follow, in good faith, the Specifications. 
  
 2.1.6 Corium Personnel. Throughout the Term,
Corium shall perform its obligations solely using employees of Corium; provided, however, that Corium may use subcontractors, consultants, or other agents if such third parties are bound in writing to non-disclosure and Intellectual
Property assignment provisions that afford Adolor the rights hereunder that Adolor would have if such third parties were Corium’s employees 

  

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(collectively, such employees and third parties are the “Corium Personnel”). Corium shall ensure that the Corium Personnel have entered into
agreements with Corium which require them to conform to the requirements binding Corium, which would include this Agreement. Corium shall be responsible for any and all breaches of this Agreement by the Corium Personnel unless such personnel are
outside contractors required by Adolor. 
  
 2.1.7 Shortages. Throughout the Term, and to the extent that Adolor complies with the forecasting requirements set forth in Section 3.6, Corium shall ensure that it has adequate capacity to perform the Processing
Activities and produce the Patches in accordance with this Agreement and in a timely manner. 
  
 2.2 Responsibility for Costs. Unless specifically set forth to the contrary herein, each Party will be responsible for all of its own costs and expenses incurred in fulfilling its obligations with
respect to the Development Program. For the avoidance of doubt, Adolor will pay Corium’s costs and expenses with respect to the Development Program as described in Exhibit D to this Agreement, as such Exhibit may be amended from time to time.

  
 2.3 Development Payments. 
  
 2.3.1 Pre-Payments. Upon execution of the LOI,
Adolor paid Corium advance, payments of [**] for equipment and [**] for labor expenses. 
  
 2.3.2 Payments. Adolor will pay Corium in accordance with the schedule and in consideration of Corium’s performance of
all of its obligations in accordance with this Agreement the amounts set forth in Exhibit D. Except as expressly specified in this Agreement or as otherwise agreed to in writing by the Parties, Adolor will pay any fees, expenses or other charges not
the subject of a good faith dispute that are payable to Corium hereunder within thirty (30) days following the date of receipt of Corium’s proper invoice therefor. 
  
 2.4 Regulatory Matters. 
  
 2.4.1 Adolor Obligations. 
  
 2.4.1.1 Adolor shall be responsible for obtaining Regulatory Approvals for the Patches and for all
interactions with Regulatory Authorities with respect to the development, registration, and sale of Patches. 
  
 2.4.1.2 Adolor shall prepare and file the NDA for the Patches and shall own the NDA. 
  
 2.4.1.3 Adolor shall be responsible for all NDA
filing fees and other costs assessed by Regulatory Authorities associated with obtaining Regulatory Approvals for the Patches and Adolor shall be responsible for communicating with Regulatory Authorities in connection with the NDA. 
  
 2.4.1.4 Adolor shall be responsible for any
pre-clinical or clinical trials for the Patches. 
  

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 2.4.2 Corium Obligations. 
  
 2.4.2.1 Corium shall maintain, or cause to be
maintained, records of its activities in connection with the Development Program in sufficient detail and in good scientific manner appropriate for Regulatory Approval, and in accordance with Regulatory Standards, which shall be complete and
accurate and shall fully and properly reflect all work done and results achieved in the performance of its obligations under this Agreement. 
  
 2.4.2.2 Corium shall undertake manufacturing scale-up according to cGMP requirements and any other requirements of the Regulatory
Authorities. 
  
 2.4.2.3 Corium will
cooperate with any and all reasonable requests for assistance from Adolor with respect to obtaining Regulatory Approvals and maintaining a consumer complaint file, including by making its employees, consultants and other scientific staff available
upon reasonable notice during normal business hours at their respective places of employment to consult with Adolor. Adolor shall reimburse Corium for any and all reasonable and verifiable labor and out-of-pocket costs and expenses incurred by
Corium in providing such assistance. 
  
 2.4.3 At Adolor’s written request and expense and upon mutual agreement of the Parties regarding timing, Corium will prepare the CMC section necessary for NDA filing. At no additional cost to Adolor, Corium shall provide clear
and legible copies of all other documentation related to its manufacture of the Patches that is required by Adolor for submission of its NDA. 
  
 2.4.4 Quality Agreement. 
  
 2.4.4.1 On the Effective Date, Adolor and Corium shall enter into the quality agreement (the “Quality Agreement”)
to be appended to this Agreement as Exhibit F. 
  
 2.4.4.2 The Quality Agreement shall be used by both Parties to define and delineate each Party’s roles and responsibilities and manage the operations of both the Adolor and Corium Quality Assurance groups in regards to the
control, processing, testing, and/or packaging of this Patch by Corium for Adolor. The Quality Agreement will cover roles and responsibilities for both Adolor and Corium for subjects including, but not limited to, master batch records and/or master
packaging records, manufacturing investigation or deviation reports, change control management, facility maintenance and monitoring, training records, validation activities, batch release, analytical testing, stability testing, and equipment
qualification. 
  
 2.4.4.3 To the extent
there are any inconsistencies or conflicts between this Agreement and the Quality Agreement, the terms and conditions of this Agreement shall control unless otherwise agreed to in writing by the Parties. 
  
 2.5 Adolor Representatives. Upon two (2) weeks notice,
throughout the Term, Corium will consider, but will not be required to approve, a request from Adolor to have, at its cost, representatives on site at the Processing Facility and with the suppliers’ permission, any permitted suppliers’
facilities during manufacture with access to the portions of the Processing Facility used in the manufacture, generation, storage, testing, treatment, holding, transportation, 

  

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distribution or other handling or receiving of the Patches and raw materials therefor for the purpose of observing, reporting on, and consulting as to such
activities. Notwithstanding the foregoing, Corium shall approve visits by Adolor personnel to the Processing Facility and any permitted suppliers’ facilities in the instance: (i) when good cause exists for such a visit, (ii) in
accordance with the Quality Agreement, and (iii) upon mutual agreement of the Parties, for selected Batches (but not all Batches) during development or after Patch Launch. If there is a dispute regarding whether Corium
shall approve a visit from Adolor, such dispute will be referred to the Joint Steering Committee for resolution. Corium shall reasonably cooperate in enabling such representatives to carry out their responsibilities and will make
adequate temporary desk space and other reasonable resources available to these representatives during the periods they are working at Corium. 
  
 2.6 cGMP Documentation. Throughout the Term, each Party shall maintain, in accordance with and for the period required under the NDA, cGMPs,
laws and Regulatory Standards, complete and adequate records pertaining to the methods and facilities used for the cGMPs pertaining to the manufacture, processing, testing, packaging, packing, labeling, holding and distribution of the Patches.
Corium shall also maintain all records related to its compliance with environmental, health and safety guidelines for such periods of time as are required by the applicable Regulatory Authorities. 
  
 3. MANUFACTURING AND SUPPLY OF PATCHES. 
  
 3.1 Agreement for Manufacture and Supply. Subject to the terms
herein, Corium shall be the exclusive supplier of Patches to Adolor commencing on the Effective Date and continuing until five (5) years following the Patch Launch plus any mutually agreed upon renewals of the Term of the Agreement. Corium may
manufacture, or have manufactured, the Patches at locations other than the Processing Facility only with the prior written consent of Adolor. Corium shall have only the authority provided under this Agreement with respect to the manufacture,
testing, packaging, storing, labeling, release, delivery or sale of Patches. 
  
 3.2 Materials. Corium shall provide all necessary chemicals, reagents and raw materials, the cost of which is included in the Transfer Price (as defined in Section 3.8.1). At all times during the
Term, the Parties each shall comply with the additional requirements with respect to the materials as set forth in Section (J) of the Quality Agreement. 
  
 3.3 Regulatory Matters. 
  
 3.3.1 Corium shall manufacture, package, store and ship the Patches in compliance with applicable cGMPs, the Specifications, and
any other standards that the Parties mutually develop and agree upon for the Patches. 
  
 3.3.2 Corium shall maintain complete and accurate documentation of all validation data, stability testing data, batch records,
quality control and laboratory testing and any other data required under cGMPs in connection with the manufacturing of the Patches hereunder. 
  
 3.3.3 Corium shall not be required to deliver Patches to more than three (3) locations specified by Adolor. Corium shall
deliver Patches with accompanying 

  

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documentation as set forth in Section (L)(3) of the Quality Agreement. At Corium’s discretion, additional labor costs to provide documents other than
those set forth in Section (L)(3) of the Quality Agreement will be Adolor’s responsibility. 
  
 3.3.4 Corium shall be responsible for executing an agreed upon stability protocol in accordance with ICH standards. 
  
 3.3.5 Corium shall be responsible for internal QA
release of each Batch of the Patches. However, Adolor shall be responsible for the final QA release of each Batch of the Patches to allow shipping for packaging and ultimate distribution for clinical development or commercial supply. For avoidance
of doubt, Adolor has the sole responsibility for the release of the Patches to clinical and/or commercial use. 
  
 3.3.6 Corium shall, using an agreed upon contractor, terminally sterilize the Patches (including any placebo patches) using gamma
radiation at the agreed upon dose in accordance with agreed upon sterilization requirements. Corium shall supply Adolor each Patch and each Placebo Patch as sterilized, and covered in a sealed pouch in accordance with Specifications and cGMPs.

  
 3.3.7 Corium shall ensure that its
facilities will comply with cGMP and FDA regulations and requirements, including the payment of any [**]. Unless a facility change is required by the FDA, any facility changes requested by Adolor shall be at Adolor’s cost and expense.

  
 3.3.8 At Adolor’s request, cost
and expense, Corium shall provide Adolor with assistance in preparing submissions to the FDA and any other Regulatory Authority. 
  
 3.3.9 Corium shall provide all additional information that is possessed by Corium and is reasonably required by Adolor from time to
time regarding Regulatory Authority filings as specified in the Quality Agreement, including a copy of the control copies of records and reports. 
  
 3.3.10 After the Effective Date, Adolor shall have the right to, upon request, audit the Processing Facility once per year, (or
more often, as mutually agreed by the Parties) including its manufacturing processes, records, reports and other facets of the operation, as necessary to assure that all applicable pertinent acts, regulations, and guidelines of the U.S. FDA and
other Regulatory Authorities, as well as evolving standards in the regulatory environment, have been met with respect to any Patches; provided, such audit: (i) is conducted during normal business hours, (ii) is conducted with minimum
disruption to Corium and in the most expeditious manner possible, and (iii) is conducted only after Adolor has given thirty (30) days prior notice. Adolor shall furnish Corium with copies of all reports prepared as a result of these
audits. Corium shall provide Adolor with written responses to any and all observations listed in the audit report furnished by Adolor including action plans and schedules to correct any deficiencies that are listed therein. 
  
 3.3.11 Adolor agrees to notify Corium within ten
(10) business days of Adolor becoming aware of any material concerns that it may have regarding the manufacturing, processing, testing or storage of Patches. If Adolor’s notification so 

  

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provides, Corium shall suspend manufacturing of Patches until satisfactory resolution of such concerns. During any such suspension requested by Adolor,
Corium’s obligation to manufacture Patches for Adolor shall be suspended, including any obligations under any outstanding Purchase Orders. 
  
 3.3.12 Notice shall be given as soon as possible by the receiving Party to the other Party of any actual or threatened legal or
administrative action arising out of the manufacture, sale, distribution, marketing or use of the Patches. Each Party shall maintain a file on all written or oral consumer or other type of complaints received which in any way relate to the Patches
for the duration of the Agreement and for three (3) years after the last distribution of the Patches, in accordance with the Quality Agreement. During the Term of this Agreement, each Party shall provide the other with a copy of such file upon
request. Adolor shall review, investigate and endeavor to handle and satisfactorily resolve such complaints and may contact Corium if it requires assistance with any of the foregoing. 
  
 3.4 Changes to Specifications. At all times during the Term, the Parties each shall comply with the procedures
governing changes in Specifications as described in Section (H) of the Quality Agreement. Any changes that will result in changed expenses and lead-time for manufacturing Patches shall be documented and reflected in the Transfer Price. Adolor
may request changes to the Specifications [**]. If either Party, in its reasonable judgment, believes that the Specifications require modification in order to comply with cGMP or to meet consumer demand or to improve the Patches, it shall provide
the other Party with written notice thereof. Following any such notification, the Parties shall meet to discuss the terms and conditions under which such modification may be implemented. 
  
 3.5 Commercial Patch Labeling Specifications. Sixteen (16) weeks prior to the date that Adolor has
requested that Corium deliver any Patches to it Adolor shall provide Corium with labeling specifications necessary for Corium to package and label the Patches in accordance with all applicable international, federal, state and local laws, rules and
regulations, and regulatory approvals, which specifications shall include provisions for the insertion of the lot number, expiration date, and any necessary artwork and engineering drawings related thereto (“Labeling
Specifications”) provided however that prior to Patch Launch the Parties shall cooperate reasonably to minimize such sixteen (16) week requirement. Corium will label and package the Patches in accordance with such Labeling
Specifications. 
  
 3.6 Commercial Forecasts.

  
 3.6.1 All commercial forecasts
provided by Adolor in connection with this Agreement shall be reasonable and made in good faith with the understanding that Corium shall rely on those forecasts for planning its production infrastructure and capacity. 
  
 3.6.2 Within one (1) year of anticipated Patch
Launch, Adolor will supply Corium with a planning forecast for the eight (8) quarter period following anticipated Patch Launch (the “Planning Forecast”). Such Planning Forecast shall be updated three (3) months prior to
Patch Launch. 
  

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 3.6.3 Following the Patch Launch, on the first business day of each calendar
quarter, Adolor shall provide Corium with a purchase forecast for the Patch for the upcoming twelve (12) months based upon Adolor’s best estimates (the “Purchase Forecasts”). Corium will utilize the Purchase Forecasts to
purchase long lead-time raw materials. Corium is authorized to purchase raw materials to support production based on the Purchase Forecasts. In the event that the forecasts are not realized and the materials are not needed to support production,
Adolor shall reimburse Corium (net 15 days) for the [**] for all raw materials received and stored beyond one hundred and twenty (120) days. If Corium is later able to use such raw materials stored beyond one hundred and twenty (120) days
in Patches for Adolor, then Corium will credit the total amount previously paid by Adolor for such materials against outstanding or future invoices. In addition, Adolor shall reimburse Corium for the [**] for all raw materials that become obsolete
(beyond usable shelf life) due to an unrealized Purchase Forecast or that become obsolete due to Specification changes (material or artwork changes). If a required Purchase Forecast is not timely submitted for Patches within ten (10) days of
Corium’s written request to Adolor for the same, the immediately preceding forecast shall become the new forecast. 
  
 3.7 Ordering Terms. 
  
 3.7.1 Submission of Binding Purchase Orders. Adolor shall place firm (i.e., non-cancelable) purchase orders
(“Purchase Orders”) at least [**] prior to Patch Launch for the first quarter’s Patch requirements. Firm Purchase Orders following the Patch Launch Purchase Order shall be placed in accordance with the current Purchase Forecast
one quarter in advance of the first required ship date for the quarter’s Patch requirements. Adolor will order Patches by submitting Purchase Orders to Corium in writing. Each Purchase Order must reference this Agreement and include ordering
information such as Patch name or other Patch identifier, quantity, unit price, requested delivery dates and delivery locations, shipping and packaging instructions, the Adolor purchase order number and any other elements necessary to ensure the
timely production and delivery of the Patch (collectively, “Ordering Information”). 
  
 3.7.2 Acceptance of Purchase Orders. Within [**] following Corium’s receipt of each Purchase Order, Corium will
acknowledge receipt thereof and accept the delivery dates set forth in the Purchase Order or provide alternate delivery dates that are reasonably acceptable to Adolor, provided, however that Corium shall prioritize the Patch in its production
schedule with at least equal importance as any other product manufactured by Corium for other customers purchasing similar quantities of products and generating similar revenue for Corium under similar terms and conditions as those set forth in this
Agreement. Within five (5) days following Adolor’s receipt of such alternate delivery dates, Adolor will either: (a) notify Corium that it rejects such dates (in which case the Parties will work together in good faith to
determine an alternative, mutually agreeable delivery date); or (b) accept such dates by issuing a confirming Purchase Order, which will be deemed accepted by Corium upon receipt. In the absence of an agreement in (a), above, the date on
the original Purchase Order shall apply. Upon Corium’s acceptance of a Purchase Order, such Purchase Order will not be cancelable or modifiable. In no event will a delivery date scheduled by Adolor be less than sixty (60) days after the
date the original Purchase Order is received by Corium, except with the prior written consent of Corium. 
  

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 3.7.3 No Conflicting Terms. Except for Ordering Information and any
Specifications referred to or incorporated into a Purchase Order, any terms and conditions contained in any invoice, shipping document, Purchase Order or in Corium’s quotation or order acknowledgment forms that are inconsistent with or in
addition to the terms and conditions of this Agreement are hereby rejected and will be deemed null and of no effect. 
  
 3.7.4 Purchase and Supply Commitments. Corium shall supply Patches in accordance with the Purchase Orders, but shall not be
required to supply any quantity of Patch beyond [**] of the Purchase Forecast for that particular quarter. If an Adolor Purchase Order for any quarter exceeds [**] of Adolor’s most recent Purchase Forecast for such Patches for such calendar
quarter, Corium and Adolor will discuss in good faith the additional amount, if any, that Corium is willing to supply consistent with its other obligations and Adolor will adjust its order accordingly. The total amount of Patches ordered by Adolor
for delivery in any calendar quarter may not be less than [**] of Adolor’s most recent Purchase Forecast for such Patch for such quarter. 
  
 3.7.5 Minimum Purchase Order Size. The minimum size of any Purchase Order for the Patch shall be [**] Batches with larger
orders being in whole number multiples of a Batch, and such Batch commitment shall be exempt from the [**] provision in Section 3.7.4. 
  
 3.7.6 Maintenance Fee. Beginning after Patch Launch, if Adolor does not submit a Purchase Order for Patches for [**], Corium
shall have no obligation to maintain the facilities, labor, supplies, or other items required to manufacture and supply the Patch and in no event shall Corium’s failure to supply Patches in response to Adolor’s Purchase Forecasts or
Purchase Orders be deemed a Supply Failure (as defined below). Beginning after Patch Launch, if Adolor has not or does not plan to submit a Purchase Order for Patches for [**], Adolor may decide to pay Corium a monthly fee for Corium to maintain the
ability to manufacture and supply Patches, which shall include Corium’s costs to maintain facilities, labor, supplies, or other items and any costs to resume the manufacture and supply of the Patch and shall not exceed [**] (the
“Maintenance Fee”). 
  
 3.8 Pricing and
Payment Terms. 
  
 3.8.1 Patch
Transfer Prices. Corium shall supply Adolor with the number of Patches requested by Adolor for commercial sale at a reasonable price, which shall not exceed $[**] for each Patch (“Transfer Price”) with an additional [**] per
Patch royalty for a total not to exceed $[**] for each Patch delivered in accordance with the terms of this Agreement. The Parties acknowledge that the current Transfer Price is based on the assumptions set forth in Exhibit B, including that the
Patches are developed, manufactured and sold for use in the United States, and will agree to appropriate adjustments of such Transfer Price in the event such assumptions change. 
  
 3.8.2 Payment Terms. All payments for Patches shall be made in U.S. dollars. Corium will issue
an invoice to Adolor on the date that Corium provides the executed batch records, the CoC and the CoA for each Batch of Patches to Adolor and Adolor will pay such invoices within thirty (30) days following Adolor’s receipt of an 

  

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invoice, provided, however, that Adolor has not rejected or otherwise disputed the receipt of such Patches. Each such invoice shall, to the extent
applicable, identify the Adolor Purchase Order number, Patch name, quantity and Lot Number, Transfer Price, freight charges and the total amount to be remitted by Adolor. 
  
 3.8.3 Taxes. Adolor will pay all taxes and duties that are assessed by any national, federal,
state or local governmental authority on Adolor’s purchase or use of the Patches, including, without limitation, sales, use, excise, value-added and withholding taxes, but excluding any taxes based on Corium’s income or gross receipts
(collectively, “Taxes”). Notwithstanding the foregoing, Adolor will have no obligation to pay any such Taxes to the extent Adolor timely provides Corium with a valid tax exemption resale certificate or other similar document.

  
 3.8.4 Collection Costs. Any
invoice not paid or disputed in good faith within sixty (60) days shall permit Corium to discontinue purchase of raw materials and production of Patches. 
  

3.8.5 Credits. In the event any rejected quantity of Patches are found not to comply with Specifications, or in the event
any recall, withdrawal, field correction or third party return of any Patches are determined to be a result of Corium’s failure to manufacture, test, package, store, label, release or deliver those Patches in accordance with the Specifications,
cGMPs, Regulatory Standards and laws, Corium shall: (i) reimburse or credit Adolor the price paid by Adolor for the affected Patches (provided that Adolor has already paid for such Patches), including any freight and insurance charges,
(ii) reimburse or credit Adolor for the actual costs incurred in [**], and (iii) reimburse or credit Adolor for any [**]. Adolor shall provide Corium with such information and documentation as Corium may reasonably request to confirm any
of the foregoing charges, costs or expenses. Alternatively, Adolor may apply a debit to one or more outstanding invoices issued by Corium provided Adolor gives Corium timely notice of such debit. If there is outstanding credit to Adolor on the
termination of this Agreement, Corium shall reimburse Adolor for the amount of such credit within thirty (30) days after this Agreement is terminated. 
  
 3.9 Patch Delivery. 
  
 3.9.1 Shipping Requirements. For all shipments of Patches to Adolor, the Parties shall mutually determine the mode of
shipment and carrier, consistent with the product label and storage conditions. All Patches delivered pursuant to the terms of this Agreement shall be suitably packed in agreed-upon shipping cartons, and marked for delivery to the attention of
Adolor at the destination specified in writing by Adolor in accordance with the terms of the Purchase Order or to such Adolor locations as requested by Adolor and at the cost of Adolor. All Patches shall be shipped FOB Processing Facility and risk
of loss shall pass to Adolor upon carrier’s receipt of the Patches from Corium, provided, however, that nothing in this Section 3.9.1 shall in any manner limit Adolor’s rights under Section 3.9.2. If any Patches are
rejected by Adolor after shipment under this Agreement, and such Patches are to be returned to Corium, then such Patches shall be shipped [**] and title to and risk of loss with respect to those rejected Patches shall pass 

  

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from Adolor to Corium upon [**]. In such cases, Corium shall reimburse Adolor for the costs of the initial shipment from the Processing Facility. 

 
 3.9.2 Acceptance. 
  
 3.9.2.1 At all times during the Term, the Parties
each shall comply with the testing and acceptance process for Patches prior to their shipment by Corium to Adolor as set forth in Section (L) of the Quality Agreement. 
  
 3.9.2.2 Latent Defects. In the case of Patches with defects not readily discoverable prior to
the shipment of any Patches to Adolor, each Party shall notify the other Party of any such defects discovered by such Party promptly following such Party’s discovery thereof. Notwithstanding anything to the contrary contained herein, in the
case of defects that are not readily ascertainable by inspection or analysis, Adolor shall have [**] from the date of discovery of such latent defect to notify Corium of such latent defect. 
  
 3.9.3 Batch Failure. 
  
 3.9.3.1 Batch Failure When Cause is Outside of
Corium’s Control or Indeterminable. In the event a Batch fails to meet the Specifications (a “Batch Failure”) for a cause outside of Corium’s control or, as agreed by both Parties, an indeterminable cause, Corium shall
re-initiate Processing Activities pursuant to this Agreement for a replacement Batch as soon as reasonably possible, provided, however that Adolor may cancel its purchase order for such Patches if the delivery of the replacement Patches will be
later than [**] after the original delivery date. In the event of such a Batch Failure, Adolor shall pay to Corium [**] for the replacement Batch (provided that Adolor has already paid Corium for the failed Batch) and the [**]. 
  
 3.9.3.2 Batch Failure Caused By Corium. In the
event of a Batch Failure for a cause within Corium’s control, Corium shall, at Adolor’s direction and Corium’s sole expense re-initiate Processing Activities pursuant to this Agreement for a replacement Batch as soon as reasonably
possible following investigation to identify root cause for remediation, provided, however, that Adolor may cancel its purchase order for such Patches if the delivery of the replacement Patches will be later than [**] after the original delivery
date. In the event of such a Batch Failure, Corium shall be responsible for the [**]. 
  
 3.10 Delivery Timing. Delays or failure to make a Patch available due to a force majeure event shall not constitute a Corium default. Corium will give notice to Adolor within five (5) days of Corium
learning that it will be unable to make Patches available as required by any Purchase Order or otherwise perform its obligations under this Agreement due to a force majeure event . 
  
 3.11 Handling of Materials; Accident Reports. Corium shall inform all Corium Personnel and any other relevant
personnel of any known or reasonably ascertainable chemical hazards associated with the Patches or any wastes generated through performance of the Processing Activities, and to provide such persons with reasonable training in the proper methods of
handling and disposing of such items. 
  

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 3.12 Certain Prohibitions. At all times during the Term, the Parties each shall comply with
the prohibitions on the manufacture of Patches in connection with potential contaminants or addressed in Section (P) of the Quality Agreement. 
  
 3.13 Warranties of Corium In Connection With Supply of Patches. Corium represents and warrants that: 
  
 3.13.1 all Patches shall be manufactured and tested
in accordance with the then current Specifications, Quality Agreement, and all Regulatory Standards, applicable laws, and further formulating, manufacturing, packaging or other standards agreed in writing and approved by the Parties; 
  
 3.13.2 the ownership and operation of the Processing
Facilities shall be in material compliance with cGMPs and all applicable Regulatory Standards and laws (including the receipt and possession of all applicable permits and authorizations, including a current drug establishment registration with the
FDA as set forth in 21 C.F.R. 207, if applicable), and any further manufacturing, or other standards agreed in writing by the Parties; and 
  
 3.13.3 all active and placebo Patches shall not be adulterated or misbranded within the meaning of applicable Regulatory Standards
or the United States Federal Food, Drug, and Cosmetic Act. 
  
 3.14 Supply Failure by Corium. Should Corium fail to supply [**] of the Patches ordered in accordance with this Agreement and Adolor’s forecasted requirements for a consecutive sixty (60) day period (“Supply
Failure”) and should Corium fail to cure such Supply Failure within an additional thirty (30) days after notice thereof, Corium will [**], provided, however, that Corium may resume manufacturing Patches and resume its role as
Adolor’s exclusive Patch manufacturer within six (6) months after providing written notice satisfactory to Adolor that it has cured the Supply Failure problem and is able to manufacture Patches. Notwithstanding the foregoing, following the
first such Supply Failure, Adolor may order Patches from its alternate supplier at any time that Corium notifies Adolor in writing (which notice Corium shall promptly provide to Adolor upon it becoming aware) that it is: (a) unable to meet
Adolor’s forecast, (b) unable to meet Adolor’s requested delivery date, or (c) unable to supply at least [**] of Adolor’s purchase order; provided however, that Adolor will accept Patches from Corium first up to its ability
to supply and any shortfall may be obtained from the alternate supplier. 
  
 3.14.1 Supply Failure Exclusions. A Supply Failure excludes the following conditions: (i) a force majeure event which is not specific to Corium’s operations, and (ii) Adolor’s
material, uncured breach, which shall include Adolor’s failure to pay Corium undisputed amounts due and owing within fifteen (15) days after Corium has notified Adolor of such payment failure. Should a force majeure event specific to
Corium’s operations that results in a Supply Failure occur, Adolor may transfer manufacturing to another supplier for the duration of the force majeure event if Corium fails to cure such Supply Failure within [**] days of such force majeure
event. Corium will resume manufacturing of Patch and resume its role as Adolor’s exclusive Patch manufacturer within [**] days of written notice satisfactory to Adolor that it has corrected the issue and is able to manufacture Patches.

  

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 3.14.2 Second Source Supplier. Adolor has the right to qualify a second
supplier in advance of a Supply Failure. Adolor may deliver the Deliverable Documents to a second supplier and otherwise use the Deliverable Documents to qualify a second supplier. Corium will provide Adolor with the Deliverable Documents upon the
target date set forth in Exhibit A (unless the Agreement is terminated either by Adolor for its business convenience or by Corium for Adolor’s material, uncured default prior to such target date in accordance with the terms of the Agreement),
provided, however, that the foregoing shall not be construed as requiring Corium to create Deliverable Documents after any termination of this Agreement pursuant to Section 7.2 hereof. For the avoidance of doubt, in the situation
where Adolor is qualifying a second supplier, Corium will not provide training and will not create or provide any documents (other than the Deliverable Documents as described above) to assist in such qualification, nor shall Corium take any action
to delay or prevent Adolor’s qualification of a second supplier. To the extent that they contain Corium Confidential Information, the Deliverable Documents will be Corium Confidential Information that will be subject to the nondisclosure
provisions of this Agreement and Adolor will impose confidentiality obligations on second suppliers that are consistent with such provisions. 
  
 3.15 Patch Complaints. At all times during the Term, the Parties each shall comply with the process for handling written or oral complaints
relating to the Patches as covered in Section (G) of the Quality Agreement. 
  
 3.16 Adverse Events. At all times during the Term, the Parties each shall comply with the process for handling adverse events associated with the use of any Patch in humans as described in the Quality
Agreement. 
  
 3.17 Notification and Cooperation For
Recalls. At all times during the Term, the Parties each shall comply with the requirements and procedures for Patch recalls as described in Section (T) of the Quality Agreement. 
  
 3.18 Retained Samples. At all times during the Term, the Parties each shall comply with the sample retention
requirements covered in Section (E) of the Quality Agreement. 
  
 4.
LICENSE GRANTS. 
  
 4.1 License for Adolor to
Sell Patches. 
  
 4.1.1 Subject to the
terms herein, Corium grants Adolor an exclusive, non-transferable, non-sublicenseable, royalty-bearing, perpetual license under the Corium Intellectual Property and Inventions, including the Corium Patents and Know-How to use, sell and offer to sell
Patches in the Territory. 
  
 4.1.2 Unless
this Agreement is terminated during the Term for convenience by Adolor or for Adolor’s material breach, after the Term of the Agreement. 

  

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and subject to Adolor’s payment of royalties to Corium, the foregoing license will also include the right for Adolor to make, have made and import
Patches. 
  
 4.2 Royalty. In accordance with
Section 3.8.1, Adolor shall pay Corium a royalty of [**] per Patch during the Term and [**] per Patch after the Term upon Sale of a Patch to third parties for so long as Adolor Sells, or offers to Sell Patches. 
  
 4.3 Audits. From the point in time at which Adolor Sells
Patches until this Agreement terminates and for three (3) years thereafter, Adolor will keep and maintain accurate records as reasonably necessary to validate the royalties payable to Corium under this Agreement. Upon at least five
(5) days advance written request by Corium, Adolor will provide access to such records for examination and audit by an independent certified public accountant chosen and paid for by Corium; provided that such audit is conducted during
Adolor’s normal business hours. If the audit dates requested by Corium will unreasonably disrupt Adolor’s business, then Corium shall conduct such audit during alternative dates, provided that Corium shall not be required to conduct such
audit more than thirty (30) days after the audit dates initially requested by Corium. Corium may not request more than one (1) such examination and audit during any twelve (12) month period, and such audit shall be limited to the
immediately preceding thirty-six (36)-month period. If any such audit discloses any underpayments of the royalties due from Adolor’s Sales of Patches under this Agreement, then (i) Adolor shall promptly correct such underpayment by paying
to Corium the amount underpaid and (ii) if such audit reveals an underpayment of amounts owed to Corium in excess of five percent (5%) during a calendar year, then Adolor shall reimburse Corium for the reasonable costs of such audit.
Alternatively, if any such audit discloses any overpayments of the royalties due from Adolor’s Sales of Patches manufactured by a third party under this Agreement, Corium shall promptly correct such over payment and Corium shall refund to
Adolor the amount that has been overpaid. The existence and results of the audit shall be considered Adolor’s Confidential Information. A condition of the audit shall be that the independent certified public accountant conducting the audit
abide by the reasonable site and security requirements that are generally applicable to visitors to Adolor’s premises. 
  
 4.4 License In A Supply Failure. Subject to the terms herein, Corium grants Adolor an exclusive, non-transferable, non-sublicenseable,
royalty-bearing, perpetual license under Corium Intellectual Property and Inventions, including the Corium Patents and Know-How to make and have made Patches in the Territory during the Term in the event of a Supply Failure or a Development Failure.

  
 4.5 License For [**]. Subject to the terms
herein, Corium grants Adolor an exclusive, non-transferable, non-sublicenseable, royalty-bearing, perpetual, license under the Corium Intellectual Property and Inventions, including the Corium Patents and Know-How to make and have made Patches in
the Territory during the Term solely for the period and to the extent that such license is necessary to allow Adolor to [**]. 
  
 5. EXCLUSIVITY. 
  
 5.1 Non-Compete. Corium shall not, directly or indirectly, compete or assist third parties in competing with Adolor in the [**]. 

 

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 5.2 Exclusive Term. Subject to the terms herein, Corium shall be the exclusive supplier of
Patches to Adolor during the Term (as defined in Section 7.1). 
  
 5.3 Negative Sale. Corium shall not sell, distribute, or otherwise transfer, without Adolor’s prior written consent, any work-in-process or finished goods inventory of Patches, other than to Adolor as expressly provided
in this Agreement, [**]. 
  
 6. CONFIDENTIALITY. 
  
 6.1 Definition. “Confidential Information”
means all secret, confidential or proprietary information or data, whether provided in written, oral, graphic, video, computer or other form, provided by one Party (the “Disclosing Party”) to the other Party (the “Receiving
Party”) pursuant to this Agreement or generated pursuant to this Agreement, including information relating to the Disclosing Party’s existing or proposed research, development efforts, patent applications, business or products, the
terms of this Agreement and any other materials that have not been made available by the Disclosing Party to the general public. Confidential Information must be disclosed in writing and conspicuously designated as “Confidential” at the
time of disclosure or if disclosed orally, identified as “Confidential” at the time of disclosure and summarized in a writing sent by the Disclosing Party to the Receiving Party within thirty (30) days of any such disclosure or
information that under the circumstances, a person exercising reasonable business judgment would understand to be the confidential or proprietary. Confidential Information includes the specific terms and pricing set forth in this Agreement.

  
 6.2 Exclusions. Notwithstanding anything to the
contrary in this Section 6, Confidential Information shall not include any information or materials that: (i) were already known to the Receiving Party (other than under an obligation of confidentiality), at the time of disclosure by the
Disclosing Party to the extent such Receiving Party has documentary evidence to that effect; (ii) were generally available to the public or otherwise part of the public domain at the time of its disclosure to the Receiving Party;
(iii) became generally available to the public or otherwise part of the public domain after its disclosure or development, as the case may be, and other than through any act or omission of a Party in breach of such Party’s confidentiality
obligations under this Agreement; (iv) were disclosed to a Party, other than under an obligation of confidentiality, by a Third Party who had no obligation to the Disclosing Party not to disclose such information to others; or (v) are
independently developed by the Receiving Party without use of the Disclosing Party’s Confidential Information as demonstrated by contemporaneous written records. 
  
 6.3 Obligations. Each of Corium and Adolor shall protect all Confidential Information received from the other
Party with the same degree of care it maintains with respect to the confidentiality of its own Confidential Information, but in no event less than a reasonable degree of care. Neither Party shall use such Confidential Information for any purpose
other than in performance of this Agreement or disclose the same to any person other than to such of its employees, board members, attorneys, accountants, advisors, consultants or agents who have a need to know such Confidential Information. In
addition to the foregoing, Adolor may disclose Confidential Information as set forth below in Section 6.4. A Receiving Party shall advise any of its employees, board members, attorneys, accountants, advisors, consultants or agents who receive
such Confidential Information of the confidential nature thereof and of the obligations 

  

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contained in this Agreement relating thereto, and the Receiving Party shall ensure that all such agents comply with such obligations as if they had been a
Party hereto. Upon termination of this Agreement, the Receiving Party shall return or destroy all documents, tapes or other media containing Confidential Information of the Disclosing Party that remain in the Receiving Party’s or its
agents’ possession, except that the Receiving Party may keep one copy of the Confidential Information in the legal department files of the Receiving Party, solely for archival purposes. Such archival copy shall be deemed to be the property of
the Disclosing Party, and shall continue to be subject to the provisions of this Section. 
  
 6.4 Certain Disclosures. 
  
 6.4.1 Required Disclosures. In the event that a Receiving Party is required by law, any governmental agency, court or other quasijudicial or regulatory body to disclose any of the Confidential
Information of the Disclosing Party, such Receiving Party shall provide the Disclosing Party with prompt written notice of any such request or requirement so that the Disclosing Party may seek a protective order or other appropriate remedy and/or
waive compliance with the provisions of this Agreement. If, in the absence of a protective order or other remedy or the receipt of a waiver by the Disclosing Party, the Receiving Party is nonetheless legally compelled to disclose any such
Confidential Information to any tribunal, regulatory body, agency or similar entity, only that portion of the Disclosing Party’s Confidential Information which it believes it is legally required to may be disclosed, provided that it exercises
its commercially reasonable efforts to preserve the confidentiality of such Confidential Information. Each Party shall determine in its sole discretion whether such Party is required to file this Agreement with the Securities Exchange Commission.

  
 6.4.2 Disclosure of Information to
[**]. Notwithstanding anything to the contrary in this Agreement, Corium agrees that Adolor may disclose technical information regarding the Patch to [**] that [**] needs to commercialize sterile lidocaine patches outside the Territory, provided
that such disclosures are required to obtain Regulatory Approval or to comply with Regulatory Standards and that Adolor first obtains Corium’s written consent to such disclosures, which consent shall be provided or refused within two
(2) business days of Adolor’s request therefore and shall not be unreasonably withheld by Corium. [**]. 
  
 6.4.3 Regulatory Disclosures. Corium agrees that Adolor shall have the right to disclose the Confidential Information of
Corium to Regulatory Authorities in an Investigational New Drug application, New Drug Application or any other regulatory filing or interaction in connection with a Regulatory Authority or other governmental entity regarding the Patches. Corium
further agrees that Adolor shall have the right to disclose Confidential Information of Corium to clinical investigators to the extent that such disclosures are required to obtain Regulatory Approval or to otherwise comply with Regulatory Standards
and Adolor first obtains Corium’s written consent to such disclosures, which will not be unreasonably withheld, provided that Adolor may disclose any information contained in an investigator brochure that has been previously provided by Adolor
to Corium or that must be disclosed immediately due to a medical emergency or other safety related issue. 
  

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 7. TERM AND TERMINATION. 
  
 7.1 Term. The term of this Agreement will commence on the Effective Date and unless earlier terminated in
accordance with this Section 7, will end five (5) years from Corium’s first commercial sale of Patches to Adolor plus any mutually agreed upon renewals (the “Term”). 
  
 7.2 Termination. 
  
 7.2.1 Termination for Convenience. Adolor may
terminate this Agreement at any time for any reason or for no reason by providing forty-five (45) days prior written notice to Corium. 
  
 7.2.2 Termination for Cause. This Agreement may be terminated by a Party for cause immediately upon the provision of written
notice to the other Party if the other Party materially breaches any material provision of this Agreement and fails to cure such breach within sixty (60) days of written notice describing the breach. 
  
 7.2.3 Effect of Termination. 
  
 7.2.3.1 If this Agreement is terminated by Adolor for
convenience pursuant to Section 7.2.1 or by Corium for Adolor’s material breach pursuant to Section 7.2.2: 
  
 7.2.3.1.1 Adolor will reimburse Corium for all expenses spent or committed to in writing by Corium in connection with this
Agreement prior to its receipt of notice of such termination upon the provision of reasonable verification of such expenses; 
  
 7.2.3.1.2 Corium shall use reasonable efforts to minimize any shutdown expenses, and Adolor will be obligated to pay Corium for
all such shutdown expenses. To the extent that Adolor has not already paid Corium for such expenses, shutdown expenses include the cost of remaining inventory in stock, any reasonable costs or expenses to which Corium has previously committed,
on-going stability costs, the cost to terminate any on-going tests or studies, and the cost to prepare any final paperwork to comply with Regulatory Standards. 
  

7.2.3.1.3 All licenses granted by Corium to Adolor in Section 4 will immediately terminate. 
  
 7.2.3.1.4 Upon termination or expiration of this
Agreement, each Party will promptly return to the other Party all Confidential Information of the other Party (and all copies and abstracts thereof), provided that each Party shall be allowed to retain copies of any information or data required by
Regulatory Authorities within the Territory and Adolor shall be allowed to retain the Deliverable Documents and to provide such documents to a second supplier. 
  

7.2.3.2 Survival. The following provisions shall survive the termination or expiration of this Agreement: 1, 2.3.2, 2.6
(the last sentence), 3.3.12, 3.8, 3.13, 4.1 (except to the extent such licenses are terminated pursuant to Section 7.2.3.1.2), 4.2, 4.3, 6, 7.2.3.1, 7.2.3.2, 8, 9, 10, 11, 12, and 13. 
  

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 8. OWNERSHIP. 
  
 8.1 Intellectual Property. 
  
 8.1.1 Corium will be the sole and exclusive owner of any inventions or intellectual property rights that relate solely to the
Corium Background Technology which are developed solely or jointly by the Parties in connection with this Agreement (“Corium Inventions”), and Adolor agrees to assign, and does hereby irrevocably assign any and all its right, title,
and interest in and to such inventions and intellectual property rights to Corium. 
  
 8.1.2 Adolor will be the sole and exclusive owner of any inventions or intellectual property rights that relate solely to the
Adolor Background Technology which are developed solely or jointly by the Parties in connection with this Agreement (“Adolor Inventions”) and Corium agrees to assign, and does hereby assign any and all its right, title, and interest
in and to such inventions and intellectual property rights to Adolor. 
  
 8.1.3 The Parties will jointly own any inventions or intellectual property that do not solely relate to either Corium’s Background Technology or Adolor’s Background Technology which both Parties’
employees or contractors jointly develop or invent in connection with this Agreement (“Joint Inventions”). A Party will solely own any inventions or intellectual property that do not relate to either Corium’s Background
Technology or Adolor’s Background that are solely developed or invented by such Party in connection with the Agreement. 
  
 8.2 Equipment. Corium will own the equipment that Adolor has purchased for it pursuant to the LOI and any other equipment purchased in
connection with this Agreement for use at Corium facilities. 
  
 8.3 Intellectual Property Maintenance. 
  
 8.3.1 Maintenance. Corium shall have the exclusive right and obligation to prepare, file and prosecute in a diligent manner (including without limitation by conducting interferences, oppositions and
reexaminations or other similar proceedings), maintain (by timely paying all maintenance fees, renewal fees, and other such fees and costs required under applicable laws) and extend all Corium Patents and related applications. Corium shall notify
Adolor prior to abandoning any Corium Patents or related applications that are material to the matters contemplated in this Agreement. 
  
 8.3.2 Offensive Infringement Actions. Upon its receipt of written notice from Adolor that the Corium Patents are being
infringed by a third party that is in direct competition with Adolor, Corium agrees to discuss appropriate steps that Corium may take regarding such infringement with Adolor, subject to any pre-existing contractual commitments Corium may have to
third parties. In the event that a Corium Patent is infringed by such third party and Corium opts not to pursue an infringement claim against such third party, then Adolor’s subsequent royalty payment obligations hereunder shall be reduced by
fifty percent (50%) so that Adolor is only required to pay a royalty of [**] 

  

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per Patch during the Term and [**] per Patch after the Term upon Sale of a Patch to third parties for so long as Adolor Sells, or offers to Sell Patches.

  
 9. WARRANTIES. 
  
 9.1 Mutual Representations and Warranties. Adolor and Corium
each represents and warrants to the other as of the Effective Date that: 
  
 9.1.1 Organization and Authority. It has full corporate right, power and authority to enter into this Agreement and to perform its respective obligations under this Agreement; 
  
 9.1.2 No Conflicts or Violations. The
execution and delivery of this Agreement by such Party and the performance of such Party’s obligations hereunder (a) do not conflict with or violate any requirement of applicable laws or regulations existing as of the Effective Date and
applicable to such Party and (b) do not conflict with, violate, breach or constitute a default under, and are not prohibited or materially restricted by, any contractual obligations of such Party or any of its Affiliates existing as of the
Effective Date; 
  
 9.1.3 Valid
Execution. Such Party is duly authorized, by all requisite corporate action, to execute and deliver this Agreement and the execution, delivery and performance of this Agreement by such Party does not require any shareholder action or approval or
the approval or consent of any Third Party, and the Person executing this Agreement on behalf of such Party is duly authorized to do so by all requisite corporate action; and 
  
 9.1.4 Certain Persons. Corium will not use, in any capacity associated with or related to the
manufacture of the Patches, the services of any persons who have been, or are in the process of being, debarred under 21 U.S.C. § 335a(a) or (b) or any comparable law, and that neither it nor any of its officers, employees, or consultants
has been convicted of an offense under: (i) either a federal or state law that is cited in 21 U.S.C. § 335(a) as a ground for debarment, denial of approval, or suspension, or (ii) any other law cited in any comparable Regulatory Act
as a ground for debarment, denial of approval or suspension. 
  
 9.2 Corium’s Representations and Warranties. Corium represents and warrants that: 
  
 9.2.1 Corium Background Technology. The Corium Background Technology and the Corium Inventions are free and clear of any
lien, encumbrance, security interest or restriction on license inconsistent with the rights granted to Adolor herein, and Corium has not previously granted and will not grant to any third party, any right, license or interest in or to the Corium
Background Technology and the Corium Inventions, or any portion thereof, inconsistent with the rights granted to Adolor herein, provided that in no event shall this representation be construed as a warranty of noninfringement from Corium;

  

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 9.2.2 Regulatory Consents. To the best of Corium’s knowledge and
subject to reasonable diligence by Corium with respect to its obligations to obtain consents, Corium has all consents from Regulatory Authorities that are necessary in performance of its obligations hereunder and the manufacture of the Patches for
commercial sale; 
  
 9.2.3
Compliance. The manufacture, generation, processing, distribution, transport, treatment, storage, disposal and other handling of any raw materials or the Patches by Corium until delivery to a carrier or freight forwarder shall: (i) be in
accordance with and conform to the Specifications, cGMPs and the Quality Agreement, (ii) be in accordance with and conform to any applicable standards specified by the United States Pharmacopeia and the Regulatory Authorities, and
(iii) otherwise conform to any provisions of the Regulatory Standards not reflected in cGMPs; 
  
 9.2.4 Patch Marketing and Sales. Corium will not market or sell the Patches produced under this Agreement except in
compliance with Section 5.3; 
  
 10. WARRANTY
DISCLAIMERS. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, EACH PARTY EXPRESSLY DISCLAIMS, WAIVES, RELEASES, AND RENOUNCES ANY WARRANTY, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF MERCHANTABILITY, NONINFRINGEMENT, OR
FITNESS FOR A PARTICULAR PURPOSE. NO ADVICE OR INFORMATION, WHETHER ORAL OR WRITTEN, OBTAINED FROM A PARTY OTHER THAN CORIUM WILL CREATE ANY WARRANTY WITH RESPECT TO THE PRODUCTS OR SERVICES PROVIDED HEREUNDER. 
  
 11. INDEMNIFICATION. 
  
 11.1 General Indemnity. 
  
 11.1.1 Indemnification by Corium. Corium
hereby agrees to defend Adolor and its Affiliates and their respective directors, officers, employees, agents, successors and assigns from and against any and all claims and suits of a Third Party and to indemnify and hold Adolor and its Affiliates
and their respective directors, officers, employees, agents, successors and assigns, harmless from and against any and all losses, damages, costs, penalties, liabilities (including strict liabilities), judgments, amounts paid in settlement, fines
and expenses (including court costs and reasonable fees of attorneys and other professionals) in connection with claims of a Third Party (individually and collectively, the “Losses of Adolor”) arising out of: 
  
 11.1.1.1 bodily injury, personal injury, death and
tangible property damage to the extent caused by noncompliance by Corium with applicable cGMPs or the Specifications in the manufacture of the Patch except to the extent such noncompliance is caused by Corium’s compliance with written
specifications or instructions provided by Adolor; 
  
 11.1.1.2 a breach by Corium of its representations and warranties hereunder. Notwithstanding the foregoing, in all cases referred to in Section 11.1.1.1, Corium shall have no liability to Adolor for any Losses of Adolor to the
extent that such Losses of 

  

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Adolor were caused by any item for which Adolor is required to indemnify Corium pursuant to Section 11.1.2 or 11.2. 
  
 11.1.2 Indemnification by Adolor. Adolor
hereby agrees to defend Corium and its Affiliates and their respective directors, officers, employees, agents, successors and assigns from and against any and all claims and suits of a Third Party and to indemnify and hold Corium and its Affiliates
and their respective directors, officers, employees, agents, successors and assigns, harmless from and against any and all losses, damages, costs, penalties, liabilities (including strict liabilities), judgments, amounts paid in settlement, fines
and expenses (including court costs and reasonable fees of attorneys and other professionals) in connection with claims of a Third Party (individually and collectively, the “Losses of Corium”) arising out of: 
  
 11.1.2.1 bodily injury, personal injury, death and
tangible property damage to the extent caused by: (a) Adolor’s clinical testing, use, or sale of Patches produced by Corium in accordance with this Agreement, (b) claims by third parties described in Section 11.2.2 that are
attributable to Corium’s non-assertion obligation set forth in Section 11.4. 
  
 11.1.2.2 a breach by Adolor of its representations and warranties hereunder. Notwithstanding the foregoing, in all cases referred
to in Sections 11.1.2.1, and 11.1.2.2, Adolor shall have no liability to Corium for any Losses of Corium to the extent that such Losses of Corium were caused by any item for which Corium is required to indemnify Adolor pursuant to Sections 11.1.1 or
11.2.1. 
  
 11.2 Intellectual Property Indemnity.

  
 11.2.1 Indemnification by
Corium. Corium shall indemnify, defend and hold harmless Adolor and its affiliates and their respective directors, officers, shareholders, employees, agents, successors and assigns from and against all Losses of Adolor in connection with,
relating to, or arising out of any third party claim that the manufacture, use, or sale of Patches by, to, or for Adolor using Corium’s Intellectual Property infringes that third party’s Intellectual Property except to the extent such
claim is one for which Adolor indemnifies Corium pursuant to Section 11.2.2. 
  
 11.2.2 Indemnification by Adolor. Adolor shall indemnify, defend and hold harmless Corium and its affiliates and their
respective directors, officers, shareholders, employees, agents, successors and assigns from and against all Losses of Corium in connection with, relating to, or arising out of any third party claim that the manufacture, use, or sale of Patches by,
to, or for Adolor infringes that third party’s Intellectual Property except to the extent such claim is one for which Corium indemnifies Adolor pursuant to Section 11.2.1. 
  
 11.3 Indemnification Procedure. Any Party seeking to be indemnified hereunder (the “Indemnified
Party”) shall provide prompt written notice to the other Party (the “Indemnifying Party”) no later than thirty (30) days after becoming aware of any actual or potential claim in respect of which indemnification may be
sought; provided, however, that the failure by the Indemnified Party to provide such prompt notice to the Indemnifying Party shall only be a bar to 

  

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recovering Losses of Adolor or Losses of Corium, as the case may be (the “Loss”), to the extent that the Indemnifying Party was prejudiced
by such failure. In the event of any such actual or threatened Loss or claim therefor, each Party shall provide the other information and assistance as the other shall reasonably request for purposes of defense, and each Party shall receive from the
other all necessary and reasonable cooperation in such defense, including the services of employees or agents of the other Party who are familiar with the transactions or occurrences out of which any such Loss may have arisen. The primary
responsibility for defending any such Loss or claim shall be with the Indemnifying Party; provided, however, that the Indemnified Party shall have the right to participate in and with respect to the defense of any Loss with counsel of its own
choosing, whose fees shall be borne by the Indemnified Party. The Indemnified Party shall not be entitled to settle any claim or agree to the entry of any judgment or other relief without the prior consent of the Indemnifying Party, which consent
shall not be unreasonably withheld, conditioned or delayed. 
  
 11.4 Additional Infringement Remedies. In the event that the right to manufacture or sell the Patch is enjoined due to an Intellectual Property infringement claim or, becomes subject to an Intellectual Property infringement
claim, Corium shall assist Adolor in procuring a license from the third party that alleges the Patch infringes to continue to manufacture or sell Patches. [**] If the Parties are unable to procure a license from such third party [**], then Corium
may decide, it its sole discretion, to cease manufacturing Patches for Adolor and to terminate the licenses granted to Adolor in Section 4 of this Agreement upon [**] days prior written notice to Adolor. In such event, Corium shall [**] against
Adolor due to Adolor’s election to [**] and Adolor’s [**] so that Adolor is only required to [**] per Patch during the Term and [**] per Patch after the Term upon Sale of a Patch to third parties for so long as Adolor Sells, or offers to
Sell Patches. 
  
 11.5 Insurance Requirements. The
Parties shall maintain, or cause to be maintained, each at its own expense: (a) product-liability insurance in an amount not less than ten million ($10,000,000) aggregate for the Term and three (3) years thereafter, and (b) general
liability, property, inventory and business interruption insurance as is commercially reasonable. Upon a Party’s written request from time to time, each Party shall furnish to the other Party one or more Certificates of Insurance reflecting
coverage under the aforementioned insurance and shall name such other Party as an additional insured on such policy. Further, each Party shall maintain workers compensation that meet relevant statutory requirements. 
  
 12. LIMITED LIABILITY 
  
 EXCEPT FOR EITHER PARTY’S INDEMNIFICATION OBLIGATIONS SET FORTH IN SECTION 11 AND EXCEPT
FOR A BREACH OF ANY PAYMENT OBLIGATIONS OF EITHER PARTY OR A BREACH BY EITHER PARTY OF SECTION 5 OR 6, NEITHER PARTY WILL BE LIABLE TO THE OTHER FOR ANY SPECIAL, INCIDENTAL, PUNITIVE OR CONSEQUENTIAL DAMAGES (INCLUDING, BUT NOT LIMITED TO, LOST
PROFITS OR REVENUE, LOSS OF USE, LOST BUSINESS OPPORTUNITIES OR LOSS OF GOODWILL), OR FOR THE COSTS OF PROCURING SUBSTITUTE PRODUCTS, ARISING OUT OF, RELATING TO OR IN CONNECTION WITH THIS AGREEMENT OR THE USE OR PERFORMANCE OF ANY PRODUCTS, WHETHER
SUCH LIABILITY ARISES FROM ANY CLAIM BASED UPON CONTRACT, 

  

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WARRANTY, TORT (INCLUDING NEGLIGENCE), PRODUCT LIABILITY OR OTHERWISE, WHETHER OR NOT SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH LOSS OR DAMAGE.
EXCEPT FOR A BREACH OF SECTION 5.1 OR 6, IN NO EVENT SHALL CORIUM’S TOTAL LIABILITY TO ADOLOR IN CONNECTION WITH THIS AGREEMENT FOR ALL CAUSES OF ACTION AND UNDER ALL THEORIES OF LIABILITY EXCEED THE TOTAL FEES PAID TO CORIUM BY ADOLOR UNDER
THE 2003 AGREEMENT AND THIS AGREEMENT. THE PARTIES HAVE AGREED THAT THESE LIMITATIONS WILL SURVIVE AND APPLY EVEN IF ANY LIMITED REMEDY SPECIFIED IN THIS AGREEMENT IS FOUND TO HAVE FAILED OF ITS ESSENTIAL PURPOSE. 
  
 13. GENERAL. 
  
 13.1 Amendment and Waiver. Except as otherwise expressly provided herein, any provision of this Agreement may
be amended and the observance of any provision of this Agreement may be waived (either generally or in any particular instance and either retroactively or prospectively) only with the written consent of the Parties. However, it is the intention of
the Parties that this Agreement be controlling over additional or different terms of any purchase order, confirmation, invoice or similar document, even if accepted in writing by both Parties, and that waivers and amendments shall be effective only
if made by non-pre-printed agreements clearly understood by both Parties to be an amendment or waiver. The failure of either Party to enforce its rights under this Agreement at any time for any period shall not be construed as a waiver of such
rights. 
  
 13.2 Governing Law and Legal Actions.
This Agreement shall be governed by and construed under the laws of the State of Delaware without regard to conflicts of laws provisions thereof. The sole jurisdiction and venue for actions related to the subject matter hereof shall be the State and
U.S. Federal courts in Delaware. 
  
 13.3 Interest.
All amounts not paid when due or disputed in good faith will accrue interest (without the requirement of a notice) at the lower of 1.5% per month or the highest rate permissible by law until the unpaid amounts are paid in full. 
  
 13.4 Headings; Interpretation. Headings and captions are for
convenience only and are not to be used in the interpretation of this Agreement. Whenever the words “include”, “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words
“without limitation”, whether or not they are in fact followed by those words or words of like import. References to any agreement, contract, statute, law or regulation are to that agreement, contract statute, law or regulation as amended,
modified or supplemented from time to time in accordance with the terms thereof. 
  
 13.5 Notices. Notices under this Agreement shall be sufficient only if personally delivered, delivered by a major commercial rapid delivery courier service or mailed by certified or registered mail,
return receipt requested, to a Party at its addresses first set forth herein or as amended by notice pursuant to this subsection, to the attention of Adrian Faasse, Chairman, in the case of Corium and to the attention of the President, with a copy
to the attention of the 

  

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General Counsel, in the case of Adolor. If not received sooner, notice by mail shall be deemed received five (5) days after deposit in the U.S. mail.

  
 13.6 Entire Agreement. This Agreement, including
all exhibits hereto, constitutes the entire and exclusive agreement between the Parties relating to its subject matter and supersedes all prior or contemporaneous representations, proposals, negotiations, discussions and agreements between or among
the Parties, whether written or oral, relating to its subject matter. 
  
 13.7 Severability. If any provision of this Agreement is held to be illegal or unenforceable, that provision shall be limited or eliminated to the minimum extent necessary so that this Agreement shall otherwise remain in full
force and effect and enforceable. 
  
 13.8 Compliance
with Laws. Each Party will comply with all applicable international, national, state, regional and local laws and regulations, including all relevant export laws and regulations of countries within the Territory and other governments
(“Export Laws”) that may be applicable to the Patches or to such Party’s activities under this Agreement. Each Party agrees to comply fully with all Export Laws to ensure that the Patches or Confidential Information are not:
(a) exported or re-exported directly or indirectly in violation of Export Laws or without the appropriate U.S. or foreign government licenses, approvals or authorizations; or (b) used for any purposes prohibited by the Export Laws. Adolor
shall obtain, and bear all expenses relating to, any necessary licenses, authorizations and/or exemptions with respect to the export from the U.S. to Canada of any Patches, or materials or items incorporated therein. 
  
 13.9 Basis of Bargain. Each Party recognizes and agrees that
the warranty disclaimers and liability and remedy limitations in this Agreement are material bargained for bases of this Agreement and that they have been taken into account and reflected in determining the consideration to be given by each Party
under this Agreement and in the decision by each Party to enter into this Agreement. 
  
 13.10 Relationship of Parties. The Parties hereto expressly understand and agree that the other is an independent contractor in the performance of each and every part of this Agreement and is solely
responsible for all of its employees and agents and its labor costs and expenses arising in connection therewith. Nothing contained in this Agreement will be construed to make the Parties partners, joint venturers, principles, agents or employees of
the other. Neither Party will have the right, power, or authority, express or implied, to bind the other Party. 
  
 13.11 Assignment. Neither Party may assign this Agreement without the prior written consent of the other Party, provided, however that
either Party may assign this Agreement to (a) a subsidiary, parent or entity under common control with that Party or (b) to a successor party in the event of a merger, acquisition, sale, transfer or other disposition of all or
substantially all of the assets of that Party, or the line of business in which this Agreement is used. 
  
 13.12 Publicity and Press Releases. Except to the extent necessary under applicable law, the Parties will mutually agree upon any press
releases or other publicity relating to the substance of the matters contained herein. 
  
 13.13 No Third Party Beneficiary. This Agreement does not confer any right or remedy other than to the Parties hereto and their respective permitted successors and assigns, and no 

  

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action may be brought against any Party hereto by any third party, including [**], claiming as a third party beneficiary to this Agreement or any Purchase
Order. Nothing in this Agreement is intended to relieve or discharge any obligation or liability of any third party to any Party to this. 
  
 13.14 Force Majeure. Except for obligations to pay money, no liability or loss of rights hereunder shall result to either Party from delay
or failure in performance caused by force majeure, that is, circumstances beyond the reasonable control of the Party affected thereby, including, without limitation, acts of God, fire, flood, war, government action, compliance with laws or
regulations (including, without limitation, those related to infringement), strikes, lockouts or other serious labor disputes, or shortage of or inability to obtain material or equipment. 
  

									
	 CORIUM INTERNATIONAL, INC.
	 	 	 	 ADOLOR CORPORATION

					
	By:	 	/s/    GARY CLEARY        	 	 	 	By:	 	/s/    MICHAEL DOUGHERTY        
	 Name:
	 	Gary Cleary, Ph.D.	 	 	 	 Name:
	 	Michael Dougherty
	 Title:
	 	President and Chief Technology Officer	 	 	 	 Title:
	 	Senior Vice President

  

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 EXHIBIT A 
  
 Deliverables and Deliverable Documents 
  
 [**] 
  

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 EXHIBIT B 
  
 United States Specifications 
  
 [**] 
  

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 EXHIBIT C 
  
 Project Timeline 
  
 [**] 
  

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 EXHIBIT D 
  
 Payments 
  
 [**] 
  

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 EXHIBIT E 
  
 Patch Transfer Prices 
  
 [**] 
  

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 EXHIBIT F 
  
 Quality Agreement 
  
 [**] 
  

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 34Proposed form of Global Note evidencing the Securities

 EXHIBIT 4.1 
  

FORM OF FIXED RATE NOTE 
  

					
	REGISTERED	 	 	 	REGISTERED
	No. FXR	 	 	 	U.S. $[            ]
	 	 	 	 	CUSIP: 61748A643

  
 Unless this
certificate is presented by an authorized representative of The Depository Trust Company (55 Water Street, New York, New York) to the issuer or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in
the name of Cede & Co. or such other name as requested by an authorized representative of The Depository Trust Company and any payment is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL since the registered owner hereof, Cede & Co., has an interest herein. 

 MORGAN STANLEY 
 SENIOR GLOBAL MEDIUM-TERM NOTE, SERIES F 
  
 8% TARGETED INCOME STRATEGIC TOTAL RETURN SECURITIES 
  
 DUE JANUARY 15, 2012 
 EXCHANGEABLE FOR A CASH AMOUNT PAYABLE IN U.S. DOLLARS 
 BASED ON THE VALUE OF THE CBOE S&P 500 BUYWRITE INDEX 
  

							
	 ORIGINAL ISSUE DATE:
December 28, 2005
	 	 INITIAL REDEMPTION DATE:
See “Issuer Redemption Right” below.
	 	 INTERIM PAYMENT RATE: 8% per annum (equivalent to $0.80 per year per each $10.00 principal amount of this Security)
	 	 MATURITY DATE: See “Maturity Date” below.

				
	 INTERIM PAYMENT ACCRUAL DATE: December 28, 2005
	 	 INITIAL REDEMPTION PERCENTAGE: See “Net Entitlement Value Payable at Maturity, upon Redemption or upon Exchange”
below.
	 	 INTERIM PAYMENT
 DATE(S): See “Interim Payment Dates” below (beginning February 15, 2006).
	 	 OPTIONAL REPAYMENT DATE(S): See “Exchange Right” below.

				
	 SPECIFIED CURRENCY: U.S. dollars
	 	 ANNUAL REDEMPTION PERCENTAGE REDUCTION: N/A
	 	 INTERIM PAYMENT PERIOD: Monthly
	 	 APPLICABILITY OF MODIFIED PAYMENT UPON ACCELERATION OR REDEMPTION: See “Discontinuance of the BXM Index; Successor Index; Alteration of
Method of Calculation” below.

				
	 IF SPECIFIED CURRENCY OTHER THAN U.S. DOLLARS, OPTION TO ELECT PAYMENT IN U.S. DOLLARS: N/A
	 	 REDEMPTION NOTICE PERIOD: See “Issuer Redemption Right” below.
	 	 APPLICABILITY OF ANNUAL INTERIM PAYMENTS: N/A
	 	 If yes, state Issue Price: N/A

				
	 EXCHANGE RATE AGENT: N/A
	 	 TAX REDEMPTION AND PAYMENT OF ADDITIONAL AMOUNTS: N/A
	 	 PRICE APPLICABLE UPON OPTIONAL REPAYMENT: See “Net Entitlement Value Payable at Maturity, upon Redemption or upon Exchange”
below.
	 	 ORIGINAL YIELD TO MATURITY: N/A

				
	 OTHER PROVISIONS:
See below.
	 	 IF YES, STATE INITIAL OFFERING DATE: N/A
	 	 	 	 

  

 2 

	 Issue Price 
	 $10.00 per Security 

  

	 Maturity Date 
	 January 15, 2012 

  

	 Denominations 
	 $10.00 and integral multiples thereof 

  

	 Interim Payment Dates 
	 The 15th day
of each month, beginning February 15, 2006 to and including the Maturity Date. On February 15, 2006, holders will receive an Interim Payment reflecting amounts accrued from December 28, 2005. 

  

	 Record Date 
	 Notwithstanding the definition of “Record Date” on page 15 hereof, the Record Date for each Interim Payment Date, including the Interim
Payment Date scheduled to occur on the Maturity Date, shall be the date which is five calendar days prior to such scheduled Interim Payment Date, whether or not that date is a Trading Day (as defined below); provided, however, that accrued but
unpaid interim payments payable on the Exchange Date (as defined below), if any (including upon exercise of the Issuer Redemption Right (as defined below)), will be payable to the Person to whom the Net Entitlement Value (as defined below) is
payable. 

  

	 Net Entitlement Value Payable at Maturity, upon Redemption or upon Exchange 
	 This Security is exchangeable on the Maturity Date or any Exchange Date, as applicable, or redeemable on certain Exchange Dates, for the Net
Entitlement Value determined on the Maturity Valuation Date (as defined below) or any Exchange Valuation Date (as defined below), as applicable. 

  

	 	 The Net Entitlement Value for each $10.00 principal amount of this Security on any Trading Day (as defined below) equals (i) the product of
(x) the Net Entitlement Value on the previous Trading Day (commencing December 28, 2005 (on which day the Net Entitlement Value equals $9.88)) times (y) the BXM Index Performance (as defined below) as of that Trading Day
minus (ii) the Adjustment Amount (as defined below) determined as of such Trading Day. 

  

	 	 The Issuer shall, or shall cause the Calculation Agent to, provide written notice to the Trustee and to The 

  

 3 

	 	 Depository Trust Company (the “Depositary”), on which notice the Trustee and the Depositary may conclusively rely, on or prior to 10:30
a.m. New York City time on the Business Day immediately prior to the Maturity Date of the Net Entitlement Value to be paid with respect to each $10.00 principal amount of this Security. 

  

	 	 If this Security is not surrendered for exchange at maturity, upon redemption, upon acceleration or upon exchange, it shall be deemed to be no
longer Outstanding under, and as defined in, the Senior Indenture, except with respect to the holder’s right to receive the cash payment hereunder (including cash in respect of interim payments, if any) at maturity, upon redemption, upon
acceleration or upon an exchange. 

  

	 The BXM Index 
	 The CBOE S&P 500 BuyWrite Index as published by the Chicago Board Options Exchange (the “CBOE”). 

  

	 BXM Index Performance 
	 On any Trading Day, the Index Value (as defined below) on that Trading Day divided by the Index Value on the previous Trading Day.

  

	 Index Value 
	 On any Trading Day, the closing value of the BXM Index or any Successor Index (as defined below) on that Trading Day. Under certain circumstances,
the Index Value will be based on the alternate calculation of the BXM Index as described under “Discontinuance of the BXM Index; Successor Index; Alteration of Method of Calculation” below. 

  

	 Adjustment Amount 
	 On any Trading Day, the sum of (i) 8% times the Issue Price times the number of calendar days since the previous calculation of
the Net Entitlement Value divided by 365 plus (ii) 2% times the Net Entitlement Value on the previous Trading Day times the number of calendar days since the previous calculation of the Net Entitlement Value
divided by 365. 

  

	 Maturity Valuation Date and Exchange Valuation Date 
	 For purposes of calculating the Net Entitlement Value payable on the Maturity Date, the Maturity Valuation Date will be the third scheduled
Trading Day immediately prior to the Maturity Date, unless there is a Market Disruption Event (as defined below) on that date. 

  

 4 

	 	 For purposes of calculating the Net Entitlement Value payable on any Exchange Date, the Exchange Valuation Date will be the last Trading Day of
the relevant Exchange Period, unless there is a Market Disruption Event on that date. 

  

	 	 If a Market Disruption Event occurs on the scheduled Maturity Valuation Date or the Exchange Valuation Date, then the Maturity Valuation Date or
the Exchange Valuation Date, as the case may be, will be the immediately succeeding Trading Day on which no Market Disruption Event has occurred. Notwithstanding the foregoing, the Maturity Valuation Date will be no later than the second scheduled
Trading Day preceding the Maturity Date and the Exchange Valuation Date will be no later than the third Trading Day following the last day of the relevant Exchange Period, as the case may be. If a Market Disruption Event occurs on the date specified
in the preceding sentence, then the Index Value for that date will be calculated on that date by the Calculation Agent (as defined below) in accordance with the formula for calculating the value of the BXM Index last in effect prior to the
commencement of the Market Disruption Event, using (x) in respect of the S&P 500 Index, the closing value (or, if trading in the relevant securities has been materially suspended or materially limited, its good faith estimate of the closing
value that would have prevailed but for such suspension or limitation) on such Trading Day of each stock most recently comprising the S&P 500 Index; and (y) in respect of the call option included in the BXM Index, the arithmetic average of
the last bid and ask prices (or, if trading in call options has been materially suspended or materially limited, its good faith estimate of the arithmetic average of the last bid and ask prices that would have prevailed but for such suspension or
limitation) of the call option reported before 4:00 p.m. (New York City time) on that date. 

  

	 Relevant Exchange 
	 The primary U.S. organized exchange or market of trading for any security then included in the BXM Index, the S&P 500 Index or any Successor
Index. 

  

	 Exchange Right 
	 The holder of this Security may, subject to the Minimum Exchange Amount (as defined below), exchange this Security on any Exchange Date for the
Net Entitlement Value, together with accrued but unpaid interim payments to but including the related Exchange Valuation Date, upon the holder’s transferring of this 

  

 5 

	 	 Security (or if in book-entry form, book-entry interests herein) to the Trustee on the Issuer’s behalf at or prior to 10:00 a.m. (New York
City time) on the Exchange Date. 

  

	 	 Promptly after such transfer, the Issuer shall, or shall cause the Calculation Agent to, provide written notice to the Trustee and the Depositary,
on which notice the Trustee and the Depositary may conclusively rely, of the Net Entitlement Value to be paid with respect to each $10.00 principal amount of this Security being exchanged. 

  

	 	 The Issuer may request that Morgan Stanley & Co. Incorporated (“MS & Co.”) purchase this Security for the Net
Entitlement Value that would otherwise have been payable by the Issuer instead of exchanging it as aforesaid. MS & Co.’s agreement to purchase the exchanged Security will be without prejudice to the holder’s right to proceed
against the Issuer upon any failure of MS & Co. to settle the purchase when due. Any Securities purchased by MS & Co. will remain outstanding. 

  

	 Minimum Exchange Amount 
	 In order for a holder to exercise its Exchange Right, the holder must exchange at least 10,000 Securities, or multiples of 100 in excess thereof.
The Minimum Exchange Amount will not apply so long as a Credit Exchange Event (as defined below) has occurred and is continuing. 

  

	 	 For purposes of the definition of “Minimum Exchange Amount,” references to “Securities” shall be deemed to refer to each
$10.00 principal amount of a Security. 

  

	 Exchange Period 
	 The first 10 calendar days of January, April, July and October in each year, beginning in April 2006. 

  

	 Exchange Date 
	 The fifth Trading Day following the Exchange Valuation Date. 

  

	 Issuer Redemption Right 
	 Beginning in December 2008, the Issuer may redeem this Security for mandatory exchange in whole, but not in part, on any Exchange Date upon at
least 10 but not more than 30 calendar days’ notice prior to that Exchange Date to the holder of this Security and to the Trustee. Prior to December 2008, the Issuer will also have the right to redeem this Security for mandatory exchange in
whole, 

  

 6 

	 	 but not in part, on any Exchange Date if, prior to any such Exchange Date, the Net Entitlement Value on any Trading Day is less than $2.00. If the
Issuer redeems this Security, the Issuer will pay to the Trustee for delivery to the holder on the Exchange Date, with respect to each $10.00 principal amount of this Security, the Net Entitlement Value determined on the related Exchange Valuation
Date, plus accrued but unpaid interim payments to, and including, the related Exchange Valuation Date. 

  

	 	 Promptly after the Exchange Valuation Date immediately preceding the redemption date established in the preceding paragraph, the Issuer shall, or
shall cause the Calculation Agent to, provide written notice to the Trustee and the Depositary, on which notice the Trustee and the Depositary may conclusively rely, of the Net Entitlement Value to be paid with respect to each $10.00 principal
amount of this Security being redeemed. 

  

	 	 Prior to 9:30 a.m. New York City time on the Business Day prior to a redemption date, the Issuer shall, or shall cause the Calculation Agent to,
provide written notice to the Trustee and the Depositary, on which notice the Trustee and the Depositary may conclusively rely, of the Net Entitlement Value to be paid with respect to each $10.00 principal amount of this Security being called for
exchange. 

  

	 Trading Day 
	 A day, as determined by the Calculation Agent, on which trading is generally conducted on the New York Stock Exchange (the “NYSE”) the
American Stock Exchange (“AMEX”), the Nasdaq Stock Market, the Chicago Mercantile Exchange and the CBOE, and in the over-the-counter market for equity securities in the United States. 

  

	 Discontinuance of the BXM Index; Successor Index; Alteration of Method of Calculation 7 
	 If CBOE or Standard & Poor’s (“S&P”) announces the discontinuance or suspension of publication of the BXM Index and,
prior to the roll date preceding such discontinuance or suspension (the “Discontinuance Roll Date”), CBOE or another entity publishes a successor or substitute index that MS & Co., as the Calculation Agent, determines, in its sole
discretion, to be substantially identical to the discontinued or suspended BXM Index 

  

 7 

	 	 (such index being referred to herein as a “Successor Index”), then any Index Value beginning on and subsequent to the Discontinuance
Roll Date will be determined by reference to the value of such Successor Index. 

  

	 	 If the Calculation Agent is unable to identify a Successor Index prior to the Discontinuance Roll Date, then beginning on the Discontinuance Roll
Date, the Calculation Agent or one of its affiliates (as selected by the Calculation Agent) will determine the Index Value on a daily basis and the Calculation Agent will undertake to identify and designate, in its sole discretion, a Successor Index
prior to the roll date immediately following the Discontinuance Roll Date (the “Subsequent Roll Date”). Upon the designation of such Successor Index by the Calculation Agent, any Index Value will be determined by reference to the value of
such Successor Index upon such designation. If, however, the Calculation Agent is unable to identify a Successor Index prior to the fifth scheduled Trading Day preceding the Subsequent Roll Date, then the Maturity Valuation Date will be deemed
accelerated to the Trading Day immediately prior to the Subsequent Roll Date, the Issuer shall, or shall cause the Calculation Agent to, give the Trustee immediate notice of such acceleration and the Calculation Agent will determine the Net
Entitlement Value on that date. 

  

	 	 If CBOE or S&P discontinues or suspends publication of the BXM Index without prior notice, then upon such discontinuance or suspension the
Calculation Agent or one of its affiliates will determine the Index Value on a daily basis and the Calculation Agent will undertake to identify and designate, in its sole discretion, a Successor Index prior to the roll date following such
discontinuance or suspension. Upon the designation of such Successor Index by the Calculation Agent, any Index Value will be determined by reference to the value of such Successor Index upon such designation. If the Calculation Agent is unable to
identify a Successor Index prior to the fifth Trading Day preceding the roll date following 

  

 8 

	 	 such discontinuance or suspension, then the Maturity Valuation Date will be deemed accelerated to the Trading Day immediately prior to the roll
date following such discontinuance or suspension, the Issuer shall, or shall cause the Calculation Agent to, give the Trustee immediate notice of such acceleration and the Calculation Agent will determine the Net Entitlement Value on that date.

  

	 	 In the event that the Calculation Agent or one of its affiliates is required to determine the Index Value pursuant to the preceding two
paragraphs, the Index Value will be computed by the Calculation Agent or one of its affiliates in accordance with the formula for and method of calculating the BXM Index last in effect prior to the discontinuance or suspension, using the closing
level (in the case of the S&P 500 Index) and closing price (in the case of the S&P 500 Index call option) (or, if trading in the relevant securities has been materially suspended or materially limited, its good faith estimate of the closing
price that would have prevailed but for that suspension or limitation) at the close of the principal trading session of the Relevant Exchange on that date of the securities most recently comprising the BXM Index. 

  

	 	 If at any time the method of calculating the BXM Index or a Successor Index, or the value thereof, is changed in a material respect, or if the BXM
Index or a Successor Index is in any other way modified so that such index does not, in the opinion of the Calculation Agent, fairly represent the value of the BXM Index or that Successor Index had such changes or modifications not been made, then,
from and after such time, the Calculation Agent will, at the close of business in New York City on each date on which the Index Value is to be determined, make such calculations and adjustments as, in the good faith judgment of the Calculation
Agent, may be necessary in order to arrive at a value of an index comparable to the BXM Index or such Successor Index, as the case may be, as if such changes or modifications had not been made, and the Calculation Agent will calculate the Index
Value with reference to the BXM Index or such Successor Index, as adjusted. Accordingly, if the method of calculating the BXM Index or a Successor Index is modified so that the value of such index is a fraction of 

  

 9 

	 	 what it would have been if it had not been modified (e.g., due to a split in the index), then the Calculation Agent will adjust such index in
order to arrive at a value of the BXM Index or such Successor Index as if it had not been modified (e.g., as if such split had not occurred). 

  

	 Credit Exchange Event 
	 If the Issuer’s senior debt rating is downgraded below A- by S&P or below A3 by Moody’s (or below the equivalent ratings of any
successor to Standard & Poor’s or Moody’s), a Credit Exchange Event will occur. So long as a Credit Exchange Event has occurred and is continuing, the Minimum Exchange Amount will not apply. The Issuer will instruct the Trustee to
notify the holder of this Security upon the occurrence of a Credit Exchange Event. 

  

	 Events of Default 
	 For purposes of Section 5.01(b) of the Senior Indenture, a failure to pay Net Entitlement Value when due as provided in this Security shall
constitute a default in payment of principal. Upon acceleration of this Security following the occurrence of an Event of Default, the holder will be entitled to receive for each $10.00 principal amount of this Security the Net Entitlement Value
calculated by the Calculation Agent as of the date of the acceleration as if such date of acceleration were the Maturity Date, together with accrued but unpaid interim payments to but excluding the date of acceleration, provided that if on or prior
to the date of acceleration the holder has elected to exchange its Securities in accordance with its Exchange Right, the amount to which the holder will be entitled will equal the Net Entitlement Value calculated as of the Exchange Valuation Date.

  

	 	 Promptly after the acceleration of this Security as aforesaid, the Issuer shall, or shall cause the Calculation Agent to, provide written notice
to the Trustee and the Depositary, on which notice the Trustee and the Depositary may conclusively rely, of the Net Entitlement Value to be paid with respect to each $10.00 principal amount of this Security upon such acceleration.

  

	 Calculation Agent 
	 MS & Co. 

  

 10 

	 	 All calculations with respect to the Net Entitlement Value will be rounded to the nearest one hundred-thousandth, with five one-millionths rounded
upward (e.g., 0.876545 would be rounded to 0.87655); all dollar amounts related to determination of the amount of cash payable per $10.00 principal amount of this Security will be rounded to the nearest ten-thousandth, with five one
hundred-thousandths rounded upward (e.g., 0.76545 would be rounded up to 0.7655); and all dollar amounts paid on the aggregate amount due with respect to this Security and the interim payments due thereon will be rounded to the nearest cent, with
one-half cent rounded upward. 

  

	 	 The Calculation Agent is solely responsible for determining the Net Entitlement Value. All determinations made by the Calculation Agent will be at
the sole discretion of the Calculation Agent and will, in the absence of manifest error, be conclusive for all purposes and binding on the Issuer, the Trustee and the holder of this Security. 

  

	 Market Disruption Event 
	 “Market Disruption Event” means, (i) the occurrence or existence of a suspension, absence or material limitation of trading of
stocks then constituting 20% or more of the value of the S&P 500 Index (or the relevant Successor Index) on the Relevant Exchanges for such securities for the same period of trading longer than two hours or during the one-half hour period
preceding the close of the principal trading session on such Relevant Exchange; (ii) a breakdown or failure in the price and trade reporting systems of any Relevant Exchange as a result of which the reported trading prices for stocks then
constituting 20% or more of the value of the S&P 500 Index (or the relevant Successor Index) during the last one-half hour preceding the close of the principal trading session on such Relevant Exchange are materially inaccurate; or
(iii) the suspension, material limitation or absence of trading on any major U.S. securities market for trading in futures or options contracts or exchange traded funds related to the BXM Index or the S&P 500 Index (or the relevant
Successor Index) for more than two hours of trading or during the one-half hour period preceding the close of the principal trading session on such market. If trading in a security included in the S&P 500 Index or the BXM

  

 11 

	 	 Index is materially suspended or materially limited at that time, then the relevant percentage contribution of that security to the value of the
S&P 500 Index or the BXM Index, as the case may be, shall be based on a comparison of (x) the portion of the value of that index attributable to that security relative to (y) the overall value of that index, in each case immediately
before that suspension or limitation. 

  

	 	 For purposes of determining whether a Market Disruption Event has occurred: (1) a limitation on the hours or number of days of trading will
not constitute a Market Disruption Event if it results from an announced change in the regular business hours of the Relevant Exchange or market; (2) a decision to permanently discontinue trading in the relevant futures or options contracts or
exchange traded funds will not constitute a Market Disruption Event; (3) limitations pursuant to the rules of any Relevant Exchange similar to NYSE Rule 80A (or any applicable rule or regulation enacted or promulgated by any other
self-regulatory organization or any government agency of scope similar to NYSE Rule 80A as determined by the Calculation Agent) on trading during significant market fluctuations will constitute a suspension, absence or material limitation of
trading; (4) a suspension of trading in futures or options contracts on the BXM Index or the S&P 500 Index by the primary securities market trading in such contracts by reason of (a) a price change exceeding limits set by such exchange
or market, (b) an imbalance of orders relating to such contracts or (c) a disparity in bid and ask quotes relating to such contracts will constitute a suspension, absence or material limitation of trading in futures or options contracts
related to the BXM Index or the S&P 500 Index and (5) a “suspension, absence or material limitation of trading” on any Relevant Exchange or on the primary market on which futures or options contracts related to the BXM Index or
the S&P 500 Index are traded will not include any time when such market is itself closed for trading under ordinary circumstances. 

  

	 United States Federal Income Taxation 
	 The Issuer, by its sale of this Security, and the holder of this Security (and any successor holder of, or holder of a beneficial interest in,
this Security), by its respective purchase hereof, agree (in the absence of an administrative determination or judicial ruling to the contrary) to characterize this Security as a prepaid cash settlement forward contract with respect to the BXM

  

 12 

	 	 Index that (i) at the time of issuance of this Security the holder pays to the Issuer an amount equal to $10.00 per each $10.00 principal
amount of this Security in consideration for the Issuer’s obligation to deliver to the holder at maturity, or upon exchange or redemption with respect to each $10.00 principal amount of this Security a cash amount equal to the Net Entitlement
Value based on the performance of the BXM Index; (ii) beginning on February 15, 2006, until the maturity, exchange or redemption of this Security, the Issuer will be obligated to make interim payments to the holder at the Interim Payment
Rate on this Security; and (iii) at maturity, or upon exchange or redemption the Issuer will deliver to the holder with respect to each $10.00 principal amount of this Security a cash amount equal to the Net Entitlement Value based on the
performance of the BXM Index, plus any accrued and unpaid interim payments, in full satisfaction of the Issuer’s obligation under such forward contract. 

  
 Each reference in this Security to “interest” or “interest payments,” “Interest Rate,”
“Interest Accrual Date,” “Interest Payment Date” and “Interest Payment Period” shall be deemed to be a reference to, respectively, “interim payments,” “Interim Payment Rate,” “Interim Payment
Accrual Date,” “Interim Payment Date” and “Interim Payment Period,” as such terms are defined or used in the “Other Provisions” of this Security. 
  
 Morgan Stanley, a Delaware corporation (together with its successors and assigns, the “Issuer”), for value
received, hereby promises to pay to CEDE & Co., or registered assignees, the Net Entitlement Value with respect to the principal sum of U.S.$[            ] (UNITED STATES DOLLARS
[            ]), on the Maturity Date specified above (except to the extent redeemed or repaid prior to maturity) and to pay interest thereon at the Interest Rate per annum specified above,
from and including the Interest Accrual Date specified above until the principal hereof is paid or duly made available for payment weekly, monthly, quarterly, semiannually or annually in arrears as specified above as the Interest Payment Period on
each Interest Payment Date (as specified above), commencing on February 15, 2006, and at maturity (or on any redemption or repayment date); provided, however, that if the Interest Accrual Date occurs between a Record Date, as defined below, and
the next succeeding Interest Payment Date, interest payments will commence on the second Interest Payment Date succeeding the Interest Accrual Date to the registered holder of this Note on the Record Date with respect to such second Interest Payment
Date; and provided, further, that if this Note is subject to “Annual Interest Payments,” interest payments shall be made annually in arrears and the term “Interest Payment Date” shall be deemed to mean the first day of March in
each year. 
  

 13 

 Interest on this Note will accrue from and including the most recent date to which interest has been paid
or duly provided for, or, if no interest has been paid or duly provided for, from and including the Interest Accrual Date, until but excluding the date the principal hereof has been paid or duly made available for payment. The interest so payable,
and punctually paid or duly provided for, on any Interest Payment Date will, subject to certain exceptions described herein, be paid to the person in whose name this Note (or one or more predecessor Notes) is registered at the close of business on
the date 15 calendar days prior to such Interest Payment Date (whether or not a Business Day (as defined below)) (each such date, a “Record Date”); provided, however, that interest payable at maturity (or any redemption or
repayment date) will be payable to the person to whom the principal hereof shall be payable. As used herein, “Business Day” means any day, other than a Saturday or Sunday, (a) that is neither a legal holiday nor a day on which banking
institutions are authorized or required by law or regulation to close (x) in The City of New York or (y) if this Note is denominated in a Specified Currency other than U.S. dollars, euro or Australian dollars, in the principal financial
center of the country of the Specified Currency, or (z) if this Note is denominated in Australian dollars, in Sydney and (b) if this Note is denominated in euro, that is also a day on which the Trans-European Automated Real-time Gross
Settlement Express Transfer System (“TARGET”) is operating (a “TARGET Settlement Day”). 
  
 Payment of the principal of this Note, any premium and the interest due at maturity (or any redemption or repayment date), unless this Note is denominated
in a Specified Currency other than U.S. dollars and is to be paid in whole or in part in such Specified Currency, will be made in immediately available funds upon surrender of this Note at the office or agency of the Paying Agent, as defined on the
reverse hereof, maintained for that purpose in the Borough of Manhattan, The City of New York, or at such other paying agency as the Issuer may determine, in U.S. dollars. U.S. dollar payments of interest, other than interest due at maturity or on
any date of redemption or repayment, will be made by U.S. dollar check mailed to the address of the person entitled thereto as such address shall appear in the Note register. A holder of U.S. $10,000,000 (or the equivalent in a Specified Currency)
or more in aggregate principal amount of Notes having the same Interest Payment Date, the interest on which is payable in U.S. dollars, shall be entitled to receive payments of interest, other than interest due at maturity or on any date of
redemption or repayment, by wire transfer of immediately available funds if appropriate wire transfer instructions have been received by the Paying Agent in writing not less than 15 calendar days prior to the applicable Interest Payment Date.

  
 If this Note is denominated in a Specified Currency other than
U.S. dollars, and the holder does not elect (in whole or in part) to receive payment in U.S. dollars pursuant to the next succeeding paragraph, payments of interest, principal or any premium with regard to this Note will be made by wire transfer of
immediately available funds to an account maintained by the holder hereof with a bank located outside the United States if appropriate wire transfer instructions have been received by the Paying Agent in writing, with respect to payments of
interest, on or prior to the fifth Business Day after the applicable Record Date and, with respect to payments of principal or any premium, at least ten Business Days prior to the Maturity Date or any redemption or repayment date, as the case may
be; provided that, if payment of interest, principal or any premium with regard to this Note is payable in euro, the account must be a euro account in a country for which the euro is the lawful currency, provided, further, that if such wire transfer
instructions are not received, such payments will be made by check payable in such 

  

 14 

 
Specified Currency mailed to the address of the person entitled thereto as such address shall appear in the Note register; and provided, further, that
payment of the principal of this Note, any premium and the interest due at maturity (or on any redemption or repayment date) will be made upon surrender of this Note at the office or agency referred to in the preceding paragraph. 
  
 If so indicated on the face hereof, the holder of this Note, if denominated
in a Specified Currency other than U.S. dollars, may elect to receive all or a portion of payments on this Note in U.S. dollars by transmitting a written request to the Paying Agent, on or prior to the fifth Business Day after such Record Date or at
least ten Business Days prior to the Maturity Date or any redemption or repayment date, as the case may be. Such election shall remain in effect unless such request is revoked by written notice to the Paying Agent as to all or a portion of payments
on this Note at least five Business Days prior to such Record Date, for payments of interest, or at least ten calendar days prior to the Maturity Date or any redemption or repayment date, for payments of principal, as the case may be. 
  
 If the holder elects to receive all or a portion of payments of principal of,
premium, if any, and interest on this Note, if denominated in a Specified Currency other than U.S. dollars, in U.S. dollars, the Exchange Rate Agent (as defined on the reverse hereof) will convert such payments into U.S. dollars. In the event of
such an election, payment in respect of this Note will be based upon the exchange rate as determined by the Exchange Rate Agent based on the highest bid quotation in The City of New York received by such Exchange Rate Agent at approximately
11:00 a.m., New York City time, on the second Business Day preceding the applicable payment date from three recognized foreign exchange dealers (one of which may be the Exchange Rate Agent unless such Exchange Rate Agent is an affiliate of the
Issuer) for the purchase by the quoting dealer of the Specified Currency for U.S. dollars for settlement on such payment date in the amount of the Specified Currency payable in the absence of such an election to such holder and at which the
applicable dealer commits to execute a contract. If such bid quotations are not available, such payment will be made in the Specified Currency. All currency exchange costs will be borne by the holder of this Note by deductions from such payments.

  
 Reference is hereby made to the further provisions of this
Note set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place. 
  
 Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature, this Note shall
not be entitled to any benefit under the Senior Indenture, as defined on the reverse hereof, or be valid or obligatory for any purpose. 
  

 15 

 IN WITNESS WHEREOF, the Issuer has caused this Note to be duly executed. 
  
 DATED: December 28, 2005 
  

			
	MORGAN STANLEY
		
	By:	 	  

	 	 	Jai Sooklal
	 	 	Assistant Treasurer

  

			
	TRUSTEE’S CERTIFICATE OF AUTHENTICATION
	
	 This is one of the Notes referred to in the within-mentioned Senior Indenture.

	
	JPMORGAN CHASE BANK, N.A., as Trustee
		
	By:	 	  

	 	 	Authorized Officer

  

 16 

 FORM OF REVERSE OF SECURITY 
  
 This Note is one of a duly authorized issue of Senior Global Medium-Term Notes, Series F, having maturities more than nine
months from the date of issue (the “Notes”) of the Issuer. The Notes are issuable under a Senior Indenture, dated as of November 1, 2004, between the Issuer and JPMorgan Chase Bank, N.A. (formerly known as JPMorgan Chase Bank), as
Trustee (the “Trustee,” which term includes any successor trustee under the Senior Indenture) (as may be amended or supplemented from time to time, the “Senior Indenture”), to which Senior Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the respective rights, limitations of rights, duties and immunities of the Issuer, the Trustee and holders of the Notes and the terms upon which the Notes are, and are to be,
authenticated and delivered. The Issuer has appointed JPMorgan Chase Bank, N.A. at its corporate trust office in The City of New York as the paying agent (the “Paying Agent,” which term includes any additional or successor Paying Agent
appointed by the Issuer) with respect to the Notes. The terms of individual Notes may vary with respect to interest rates, interest rate formulas, issue dates, maturity dates, or otherwise, all as provided in the Senior Indenture. To the extent not
inconsistent herewith, the terms of the Senior Indenture are hereby incorporated by reference herein. 
  
 Unless otherwise indicated on the face hereof, this Note will not be subject to any sinking fund and, unless otherwise provided on the face hereof in
accordance with the provisions of the following two paragraphs, will not be redeemable or subject to repayment at the option of the holder prior to maturity. 
  
 If so indicated on the face hereof, this Note may be redeemed in whole or in part at the option of the Issuer on or after the Initial Redemption Date
specified on the face hereof on the terms set forth on the face hereof, together with interest accrued and unpaid hereon to the date of redemption. If this Note is subject to “Annual Redemption Percentage Reduction,” the Initial Redemption
Percentage indicated on the face hereof will be reduced on each anniversary of the Initial Redemption Date by the Annual Redemption Percentage Reduction specified on the face hereof until the redemption price of this Note is 100% of the principal
amount hereof, together with interest accrued and unpaid hereon to the date of redemption. Notice of redemption shall be mailed to the registered holders of the Notes designated for redemption at their addresses as the same shall appear on the Note
register not less than 30 nor more than 60 calendar days prior to the date fixed for redemption or within the Redemption Notice Period specified on the face hereof, subject to all the conditions and provisions of the Senior Indenture. In the event
of redemption of this Note in part only, a new Note or Notes for the amount of the unredeemed portion hereof shall be issued in the name of the holder hereof upon the cancellation hereof. 
  
 If so indicated on the face of this Note, this Note will be subject to repayment at the option of the holder on the Optional
Repayment Date or Dates specified on the face hereof on the terms set forth herein. On any Optional Repayment Date, this Note will be repayable in whole or in part in increments of $1,000 or, if this Note is denominated in a Specified Currency other
than U.S. dollars, in increments of 1,000 units of such Specified Currency (provided that any remaining principal amount hereof shall not be less than the minimum authorized denomination hereof) at the option of the holder hereof at a price equal to
100% of the principal amount to be repaid, together with interest accrued and unpaid hereon to the date of repayment, provided that if this Note is issued with original issue discount, this Note will be repayable on the applicable 

  

 17 

 
Optional Repayment Date or Dates at the price(s) specified on the face hereof. For this Note to be repaid at the option of the holder hereof, the Paying
Agent must receive at its corporate trust office in the Borough of Manhattan, The City of New York, at least 15 but not more than 30 calendar days prior to the date of repayment, (i) this Note with the form entitled “Option to Elect
Repayment” below duly completed or (ii) a telegram, telex, facsimile transmission or a letter from a member of a national securities exchange or the National Association of Securities Dealers, Inc. or a commercial bank or a trust company
in the United States setting forth the name of the holder of this Note, the principal amount hereof, the certificate number of this Note or a description of this Note’s tenor and terms, the principal amount hereof to be repaid, a statement that
the option to elect repayment is being exercised thereby and a guarantee that this Note, together with the form entitled “Option to Elect Repayment” duly completed, will be received by the Paying Agent not later than the fifth Business Day
after the date of such telegram, telex, facsimile transmission or letter; provided, that such telegram, telex, facsimile transmission or letter shall only be effective if this Note and form duly completed are received by the Paying Agent by such
fifth Business Day. Exercise of such repayment option by the holder hereof shall be irrevocable. In the event of repayment of this Note in part only, a new Note or Notes for the amount of the unpaid portion hereof shall be issued in the name of the
holder hereof upon the cancellation hereof. 
  
 Interest payments
on this Note will include interest accrued to but excluding the Interest Payment Dates or the Maturity Date (or any earlier redemption or repayment date), as the case may be. Unless otherwise provided on the face hereof, interest payments for this
Note will be computed and paid on the basis of a 360-day year of twelve 30-day months. 
  
 In the case where the Interest Payment Date or the Maturity Date (or any redemption or repayment date) does not fall on a Business Day, payment of interest, premium, if any, or principal otherwise payable on such date
need not be made on such date, but may be made on the next succeeding Business Day with the same force and effect as if made on the Interest Payment Date or on the Maturity Date (or any redemption or repayment date), and no interest on such payment
shall accrue for the period from and after the Interest Payment Date or the Maturity Date (or any redemption or repayment date) to such next succeeding Business Day. 
  
 This Note and all the obligations of the Issuer hereunder are direct, unsecured obligations of the Issuer and rank without
preference or priority among themselves and pari passu with all other existing and future unsecured and unsubordinated indebtedness of the Issuer, subject to certain statutory exceptions in the event of liquidation upon insolvency. 
  
 This Note, and any Note or Notes issued upon transfer or exchange hereof, is
issuable only in fully registered form, without coupons, and, if denominated in U.S. dollars, unless otherwise stated above, is issuable only in denominations of U.S. $1,000 and any integral multiple of U.S. $1,000 in excess thereof. If this Note is
denominated in a Specified Currency other than U.S. dollars, then, unless a higher minimum denomination is required by applicable law, it is issuable only in denominations of the equivalent of U.S. $1,000 (rounded to an integral multiple of 1,000
units of such Specified Currency), or any amount in excess thereof which is an integral multiple of 1,000 units of such Specified Currency, as determined by reference to the noon dollar buying rate in The City of New York for cable transfers of such
Specified Currency published by the Federal Reserve Bank of New York (the “Market Exchange Rate”) on the Business Day immediately preceding the date of issuance. 
  

 18 

 The Trustee has been appointed registrar for the Notes, and the Trustee will maintain at its office in
The City of New York a register for the registration and transfer of Notes. This Note may be transferred at the aforesaid office of the Trustee by surrendering this Note for cancellation, accompanied by a written instrument of transfer in form
satisfactory to the Issuer and the Trustee and duly executed by the registered holder hereof in person or by the holder’s attorney duly authorized in writing, and thereupon the Trustee shall issue in the name of the transferee or transferees,
in exchange herefor, a new Note or Notes having identical terms and provisions and having a like aggregate principal amount in authorized denominations, subject to the terms and conditions set forth herein; provided, however, that the Trustee will
not be required (i) to register the transfer of or exchange any Note that has been called for redemption in whole or in part, except the unredeemed portion of Notes being redeemed in part, (ii) to register the transfer of or exchange any
Note if the holder thereof has exercised his right, if any, to require the Issuer to repurchase such Note in whole or in part, except the portion of such Note not required to be repurchased, or (iii) to register the transfer of or exchange
Notes to the extent and during the period so provided in the Senior Indenture with respect to the redemption of Notes. Notes are exchangeable at said office for other Notes of other authorized denominations of equal aggregate principal amount having
identical terms and provisions. All such exchanges and transfers of Notes will be free of charge, but the Issuer may require payment of a sum sufficient to cover any tax or other governmental charge in connection therewith. All Notes surrendered for
exchange shall be accompanied by a written instrument of transfer in form satisfactory to the Issuer and the Trustee and executed by the registered holder in person or by the holder’s attorney duly authorized in writing. The date of
registration of any Note delivered upon any exchange or transfer of Notes shall be such that no gain or loss of interest results from such exchange or transfer. 
  

In case this Note shall at any time become mutilated, defaced or be destroyed, lost or stolen and this Note or evidence of the loss, theft or
destruction thereof (together with the indemnity hereinafter referred to and such other documents or proof as may be required in the premises) shall be delivered to the Trustee, the Issuer in its discretion may execute a new Note of like tenor in
exchange for this Note, but, if this Note is destroyed, lost or stolen, only upon receipt of evidence satisfactory to the Trustee and the Issuer that this Note was destroyed or lost or stolen and, if required, upon receipt also of indemnity
satisfactory to each of them. All expenses and reasonable charges associated with procuring such indemnity and with the preparation, authentication and delivery of a new Note shall be borne by the owner of the Note mutilated, defaced, destroyed,
lost or stolen. 
  
 The Senior Indenture provides that (a) if
an Event of Default (as defined in the Senior Indenture) due to the default in payment of principal of, premium, if any, or interest on, any series of debt securities issued under the Senior Indenture, including the series of Senior Medium-Term
Notes of which this Note forms a part, or due to the default in the performance or breach of any other covenant or warranty of the Issuer applicable to the debt securities of such series but not applicable to all outstanding debt securities issued
under the Senior Indenture shall have occurred and be continuing, either the Trustee or the holders of not less than 25% in aggregate principal amount of the outstanding debt securities of each affected series, voting as one class, by notice in
writing to the Issuer and to the Trustee, if given by the securityholders, may then declare the principal of all debt securities of all such series and interest accrued thereon to be due and payable immediately and (b) if an Event of Default
due to a default in the 

  

 19 

 
performance of any other of the covenants or agreements in the Senior Indenture applicable to all outstanding debt securities issued thereunder, including
this Note, or due to certain events of bankruptcy, insolvency or reorganization of the Issuer, shall have occurred and be continuing, either the Trustee or the holders of not less than 25% in aggregate principal amount of all outstanding debt
securities issued under the Senior Indenture, voting as one class, by notice in writing to the Issuer and to the Trustee, if given by the securityholders, may declare the principal of all such debt securities and interest accrued thereon to be due
and payable immediately, but upon certain conditions such declarations may be annulled and past defaults may be waived (except a continuing default in payment of principal or premium, if any, or interest on such debt securities) by the holders of a
majority in aggregate principal amount of the debt securities of all affected series then outstanding. 
  
 If the face hereof indicates that this Note is subject to “Modified Payment upon Acceleration or Redemption,” then (i) if the principal
hereof is declared to be due and payable as described in the preceding paragraph, the amount of principal due and payable with respect to this Note shall be limited to the aggregate principal amount hereof multiplied by the sum of the Issue Price
specified on the face hereof (expressed as a percentage of the aggregate principal amount) plus the original issue discount amortized from the Interest Accrual Date to the date of declaration, which amortization shall be calculated using the
“interest method” (computed in accordance with generally accepted accounting principles in effect on the date of declaration), (ii) for the purpose of any vote of securityholders taken pursuant to the Senior Indenture prior to the
acceleration of payment of this Note, the principal amount hereof shall equal the amount that would be due and payable hereon, calculated as set forth in clause (i) above, if this Note were declared to be due and payable on the date of any such
vote and (iii) for the purpose of any vote of securityholders taken pursuant to the Senior Indenture following the acceleration of payment of this Note, the principal amount hereof shall equal the amount of principal due and payable with
respect to this Note, calculated as set forth in clause (i) above. 
  
 If the face hereof indicates that this Note is subject to “Tax Redemption and Payment of Additional Amounts,” this Note may be redeemed, as a whole, at the option of the Issuer at any time prior to maturity, upon the giving of a
notice of redemption as described below, at a redemption price equal to 100% of the principal amount hereof, together with accrued interest to the date fixed for redemption (except that if this Note is subject to “Modified Payment upon
Acceleration or Redemption,” such redemption price would be limited to the aggregate principal amount hereof multiplied by the sum of the Issue Price specified on the face hereof (expressed as a percentage of the aggregate principal amount)
plus the original issue discount amortized from the Interest Accrual Date to the date of redemption, which amortization shall be calculated using the “interest method” (computed in accordance with generally accepted accounting principles
in effect on the date of redemption) (the “Amortized Amount”)), if the Issuer determines that, as a result of any change in or amendment to the laws, or any regulations or rulings promulgated thereunder, of the United States or of any
political subdivision or taxing authority thereof or therein affecting taxation, or any change in official position regarding the application or interpretation of such laws, regulations or rulings, which change or amendment becomes effective on or
after the Initial Offering Date hereof, the Issuer has or will become obligated to pay Additional Amounts, as defined below, with respect to this Note as described below. Prior to the giving of any notice of redemption pursuant to this paragraph,
the Issuer shall deliver to the Trustee (i) a certificate stating that the Issuer is entitled to effect such redemption and setting 

  

 20 

 
forth a statement of facts showing that the conditions precedent to the right of the Issuer to so redeem have occurred, and (ii) an opinion of
independent legal counsel satisfactory to the Trustee to such effect based on such statement of facts; provided that no such notice of redemption shall be given earlier than 60 calendar days prior to the earliest date on which the Issuer would be
obligated to pay such Additional Amounts if a payment in respect of this Note were then due. 
  
 Notice of redemption will be given not less than 30 nor more than 60 calendar days prior to the date fixed for redemption or within the Redemption Notice Period specified on the face hereof, which date and the
applicable redemption price will be specified in the notice. 
  
 If the face hereof indicates that this Note is subject to “Tax Redemption and Payment of Additional Amounts,” the Issuer will, subject to certain exceptions and limitations set forth below, pay such additional amounts (the
“Additional Amounts”) to the holder of this Note who is a United States Alien as may be necessary in order that every net payment of the principal of and interest on this Note and any other amounts payable on this Note, after withholding
or deduction for or on account of any present or future tax, assessment or governmental charge imposed upon or as a result of such payment by the United States, or any political subdivision or taxing authority thereof or therein, will not be less
than the amount provided for in this Note to be then due and payable. The Issuer will not, however, make any payment of Additional Amounts to any such holder who is a United States Alien for or on account of: 
  
 (a) any present or future tax, assessment or other
governmental charge that would not have been so imposed but for (i) the existence of any present or former connection between such holder, or between a fiduciary, settlor, beneficiary, member or shareholder of such holder, if such holder is an
estate, a trust, a partnership or a corporation for United States federal income tax purposes, and the United States, including, without limitation, such holder, or such fiduciary, settlor, beneficiary, member or shareholder, being or having been a
citizen or resident thereof or being or having been engaged in a trade or business or present therein or having, or having had, a permanent establishment therein or (ii) the presentation by or on behalf of the holder of this Note for payment on
a date more than 15 calendar days after the date on which such payment became due and payable or the date on which payment thereof is duly provided for, whichever occurs later; 
  
 (b) any estate, inheritance, gift, sales, transfer, excise or personal property tax or any similar tax,
assessment or governmental charge; 
  
 (c) any
tax, assessment or other governmental charge imposed by reason of such holder’s past or present status as a personal holding company or foreign personal holding company or controlled foreign corporation or passive foreign investment company
with respect to the United States or as a corporation which accumulates earnings to avoid United States federal income tax or as a private foundation or other tax-exempt organization or a bank receiving interest under Section 881(c)(3)(A) of
the Internal Revenue Code of 1986, as amended; 
  
 (d) any tax, assessment or other governmental charge that is payable otherwise than by withholding or deduction from payments on or in respect of this Note; 
  

 21 

 (e) any tax, assessment or other governmental charge required to be withheld by any
Paying Agent from any payment of principal of, or interest on, this Note, if such payment can be made without such withholding by any other Paying Agent in a city in Western Europe; 
  
 (f) any tax, assessment or other governmental charge that would not have been imposed but for the failure to
comply with certification, information or other reporting requirements concerning the nationality, residence or identity of the holder or beneficial owner of this Note, if such compliance is required by statute or by regulation of the United States
or of any political subdivision or taxing authority thereof or therein as a precondition to relief or exemption from such tax, assessment or other governmental charge; 
  
 (g) any tax, assessment or other governmental charge imposed by reason of such holder’s past or present
status as the actual or constructive owner of 10% or more of the total combined voting power of all classes of stock entitled to vote of the Issuer or as a direct or indirect subsidiary of the Issuer; or 
  
 (h) any combination of items (a), (b), (c), (d), (e),
(f) or (g). 
  
 In addition, the Issuer shall not be required
to make any payment of Additional Amounts (i) to any such holder where such withholding or deduction is imposed on a payment to an individual and is required to be made pursuant to any law implementing or complying with, or introduced in order
to conform to, any European Union Directive on the taxation of savings; or (ii) by or on behalf of a holder who would have been able to avoid such withholding or deduction by presenting this Note or the relevant coupon to another Paying Agent
in a member state of the European Union. Nor shall the Issuer pay Additional Amounts with respect to any payment on this Note to a United States Alien who is a fiduciary or partnership or other than the sole beneficial owner of such payment to the
extent such payment would be required by the laws of the United States (or any political subdivision thereof) to be included in the income, for tax purposes, of a beneficiary or settlor with respect to such fiduciary or a member of such partnership
or a beneficial owner who would not have been entitled to the Additional Amounts had such beneficiary, settlor, member or beneficial owner been the holder of this Note. 
  
 The Senior Indenture permits the Issuer and the Trustee, with the consent of the holders of not less than a majority in
aggregate principal amount of the debt securities of all series issued under the Senior Indenture then outstanding and affected (voting as one class), to execute supplemental indentures adding any provisions to or changing in any manner the rights
of the holders of each series so affected; provided that the Issuer and the Trustee may not, without the consent of the holder of each outstanding debt security affected thereby, (a) extend the final maturity of any such debt security, or
reduce the principal amount thereof, or reduce the rate or extend the time of payment of interest thereon, or reduce any amount payable on redemption thereof, or change the currency of payment thereof, or modify or amend the provisions for
conversion of any currency into any other currency, or modify or amend the provisions for conversion or exchange of the debt security for securities of the Issuer or other entities or for other property or the cash value of the property (other than
as provided in the antidilution provisions or other similar adjustment provisions of the debt securities or otherwise in accordance with the terms thereof), or impair or affect the rights of any holder to institute suit for the payment thereof or
(b) reduce the aforesaid percentage in principal amount of debt securities the consent of the holders of which is required for any such supplemental indenture. 
  

 22 

 Except as set forth below, if the principal of, premium, if any, or interest on this Note is payable in a
Specified Currency other than U.S. dollars and such Specified Currency is not available to the Issuer for making payments hereon due to the imposition of exchange controls or other circumstances beyond the control of the Issuer or is no longer used
by the government of the country issuing such currency or for the settlement of transactions by public institutions within the international banking community, then the Issuer will be entitled to satisfy its obligations to the holder of this Note by
making such payments in U.S. dollars on the basis of the Market Exchange Rate on the date of such payment or, if the Market Exchange Rate is not available on such date, as of the most recent practicable date; provided, however, that if the euro has
been substituted for such Specified Currency, the Issuer may at its option (or shall, if so required by applicable law) without the consent of the holder of this Note effect the payment of principal of, premium, if any, or interest on any Note
denominated in such Specified Currency in euro in lieu of such Specified Currency in conformity with legally applicable measures taken pursuant to, or by virtue of, the Treaty establishing the European Community, as amended. Any payment made under
such circumstances in U.S. dollars or euro where the required payment is in an unavailable Specified Currency will not constitute an Event of Default. If such Market Exchange Rate is not then available to the Issuer or is not published for a
particular Specified Currency, the Market Exchange Rate will be based on the highest bid quotation in The City of New York received by the Exchange Rate Agent at approximately 11:00 a.m., New York City time, on the second Business Day preceding the
date of such payment from three recognized foreign exchange dealers (the “Exchange Dealers”) for the purchase by the quoting Exchange Dealer of the Specified Currency for U.S. dollars for settlement on the payment date, in the aggregate
amount of the Specified Currency payable to those holders or beneficial owners of Notes and at which the applicable Exchange Dealer commits to execute a contract. One of the Exchange Dealers providing quotations may be the Exchange Rate Agent unless
the Exchange Rate Agent is an affiliate of the Issuer. If those bid quotations are not available, the Exchange Rate Agent shall determine the market exchange rate at its sole discretion. 
  
 The “Exchange Rate Agent” shall be Morgan Stanley & Co. Incorporated, unless otherwise indicated on the
face hereof. 
  
 All determinations referred to above made by, or
on behalf of, the Issuer or by, or on behalf of, the Exchange Rate Agent shall be at such entity’s sole discretion and shall, in the absence of manifest error, be conclusive for all purposes and binding on holders of Notes and coupons.

  
 So long as this Note shall be outstanding, the Issuer will
cause to be maintained an office or agency for the payment of the principal of and premium, if any, and interest on this Note as herein provided in the Borough of Manhattan, The City of New York, and an office or agency in said Borough of Manhattan
for the registration, transfer and exchange as aforesaid of the Notes. 
  
 The Issuer may designate other agencies for the payment of said principal, premium and interest at such place or places (subject to applicable laws and regulations) as the Issuer may decide. So long as there shall be such an agency, the
Issuer shall keep the Trustee advised of the names and locations of such agencies, if any are so designated. If any European Union Directive 

  

 23 

 
on the taxation of savings comes into force, the Issuer will, to the extent possible as a matter of law, maintain a Paying Agent in a member state of the
European Union that will not be obligated to withhold or deduct tax pursuant to any such Directive or any law implementing or complying with, or introduced in order to conform to, such Directive. 
  
 With respect to moneys paid by the Issuer and held by the Trustee or any
Paying Agent for payment of the principal of or interest or premium, if any, on any Notes that remain unclaimed at the end of two years after such principal, interest or premium shall have become due and payable (whether at maturity or upon call for
redemption or otherwise), (i) the Trustee or such Paying Agent shall notify the holders of such Notes that such moneys shall be repaid to the Issuer and any person claiming such moneys shall thereafter look only to the Issuer for payment
thereof and (ii) such moneys shall be so repaid to the Issuer. Upon such repayment all liability of the Trustee or such Paying Agent with respect to such moneys shall thereupon cease, without, however, limiting in any way any obligation that
the Issuer may have to pay the principal of or interest or premium, if any, on this Note as the same shall become due. 
  
 No provision of this Note or of the Senior Indenture shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the
principal of, premium, if any, and interest on this Note at the time, place, and rate, and in the coin or currency, herein prescribed unless otherwise agreed between the Issuer and the registered holder of this Note. 
  
 Prior to due presentment of this Note for registration of transfer, the
Issuer, the Trustee and any agent of the Issuer or the Trustee may treat the holder in whose name this Note is registered as the owner hereof for all purposes, whether or not this Note be overdue, and none of the Issuer, the Trustee or any such
agent shall be affected by notice to the contrary. No recourse shall be had for the payment of the principal of, premium, if any, or the interest on this Note, for any claim based hereon, or otherwise in respect hereof, or based on or in respect of
the Senior Indenture or any indenture supplemental thereto, against any incorporator, shareholder, officer or director, as such, past, present or future, of the Issuer or of any successor corporation, either directly or through the Issuer or any
successor corporation, whether by virtue of any constitution, statute or rule of law or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance hereof and as part of the consideration for the issue
hereof, expressly waived and released. 
  
 This Note shall for all
purposes be governed by, and construed in accordance with, the laws of the State of New York. 
  
 As used herein, the term “United States Alien” means any person who is, for United States federal income tax purposes, (i) a nonresident alien individual, (ii) a foreign corporation, (iii) a
nonresident alien fiduciary of a foreign estate or trust or (iv) a foreign partnership one or more of the members of which is, for United States federal income tax purposes, a nonresident alien individual, a foreign corporation or a nonresident
alien fiduciary of a foreign estate or trust. 
  
 All terms used
in this Note which are defined in the Senior Indenture and not otherwise defined herein shall have the meanings assigned to them in the Senior Indenture. 
  

 24 

 ABBREVIATIONS 
  
 The following abbreviations, when used in the inscription on the face of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations: 
  

					
	 TEN COM
	 	-	  	as tenants in common
	 TEN ENT
	 	-	  	as tenants by the entireties
	 JT TEN
	 	-	  	as joint tenants with right of survivorship and not as tenants in common

  

							
	 UNIF GIFT MIN ACT -
	 	  

	  	Custodian	 	  

	 	 	(Minor)	  	 	 	(Cust)
		
	 Under Uniform Gifts to Minors Act
	 	  

	 	 	 	  	(State)	 	 

  
 Additional abbreviations may also be
used though not in the above list. 
  
 FOR VALUE RECEIVED, the
undersigned hereby sell(s), assign(s) and transfer(s) unto 
  

	
	  

	 [PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE]

	  

	  

	  

	[PLEASE PRINT OR TYPE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE]

  
 the within Note and all rights
thereunder, hereby irrevocably constituting and appointing such person attorney to transfer such note on the books of the Issuer, with full power of substitution in the premises. 
  

			
	 Dated:
	 	  

  

			
	NOTICE:	 	The signature to this assignment must correspond with the name as written upon the face of the within Note in every particular without alteration or enlargement or any change
whatsoever.

  

 25

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