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Exhibit 10.2  

CONFIDENTIAL TREATMENT REQUESTED

S.E.C. REDACTED COPY  

Confidential Portion Indicated by "[***]"  

 
 

FIRST AMENDMENT TO SUPPLY AGREEMENT
  BETWEEN
  BANNER PHARMACAPS INC.
  AND
  FIRST HORIZON PHARMACEUTICAL CORPORATION
  AS ASSIGNEE OF
  SANOFI-SYNTHELABO INC.    
    

        THIS FIRST AMENDMENT TO SUPPLY AGREEMENT (the "Amendment") is entered into as of the 1st day of January 2003 by and between Banner
Pharmacaps Inc., a Delaware Corporation ("Banner"), and First Horizon Pharmaceutical Corporation, as Delaware Corporation ("First Horizon"). 

WITNESSETH:  

        WHEREAS, Banner and Sanofi-Synthelabo Inc. ("Sanofi" or SaSy") entered into that certain Supply Agreement
dated as of March 3rd, 2001 (the "Supply Agreement"); 

        WHEREAS, in connection with First Horizon acquiring all Sanofi's rights, title and interest in certain prescription prenatal vitamin
products, Sanofi assigned its rights under the Supply Agreement to First
Horizon pursuant to that certain Assignment and Assumption and Consent Agreement dated August 20th, 2001; and 

        WHEREAS, Banner and First Horizon wish to amend the Supply Agreement: 

        NOW, THEREFORE, for and in consideration of the premises and mutual agreements herein contained and for the purposes of setting the terms
and conditions of this Amendment, Banner and First Horizon, intending to be bound, hereby agree as follows: 

	A.
	Incorporation of Terms

All
capitalized terms which are not defined hereunder shall have the same meanings as set forth in the Supply Agreement. To the extent any terms and provisions of the Supply Agreement are inconsistent
with the amendments set forth in Section B below, such terms and provisions shall be deemed superceded hereby. Except as specifically set forth herein, the Agreement shall remain in full force
and effect and its provisions shall continue to be binding on the Parties hereto. 

CONFIDENTIAL PORTION INDICATED BY "[***]"  

	B.
	Amendment of the Supply Agreement

	1.
	Section 2.3 (Exclusivity) shall be amended by inserting the following after the second sentence which ends with "term of this
Agreement": 

"During
the term of this Agreement, subject to the conditions set forth below, Banner agrees not to manufacture (either for itself or a third party), a prescription prenatal vitamin product for sale
or distribution within the United States which (i) uses any of the following Pantone® colors: 247C, 248C, 249C, 253C, 254C and 255C, or (ii) has enrobing containing the two
colors to be mutually agreed upon in writing by Banner and SaSy." 

	2.
	Section 2.3(a) shall be amended by replacing "[***]
million" with "[***] million".

	3.
	Section 3.1 (Pricing) shall be replaced with: "Pricing for the Product shall be  [$***] per 1.000 units,
 subject to adjustment pursuant to Section 3.2(a). Pricing for any Products other than the
PrenateTM brand Product shall be subject to agreement by the parties."

	4.
	Section 3.6.1 shall be replaced with: 

"For
Calendar Year 2003 and subsequent years during the term of this Agreement, including any extension, SaSy shall pay to Banner annually a royalty as a percentage of Net Sales as set forth in the
schedule below: 

	For Net Sales
 
	 	Royalty

	from $0 to $10 million	 	[***%]
	greater than $10 million & less than or equal to $15 million	 	[***%]
	greater than $15 million	 	[***%]

For
example, if Net Sales in Calendar Year 2003 were $23 million, the royalty for Calendar Year 2003 would be $[***]
calculated as follows:
($10 million × [***%]) + ($5 million × [***%])
 + ($8 million × [***%]). 

By
forty-five (45) days after the end of each calendar quarter of a Calendar Year, SaSy shall make a payment to Banner to be applied toward the royalty owed for such Calendar Year
as follows. Each such quarterly payment shall be determined by: (i) annualizing the Net Sales in the Calendar Year through the end of the last calendar quarter; (ii) determining the
amount of royalty due per the schedule above; (iii) dividing that amount by four (4) and multiplying the quotient by the number of calendar quarters that have ensued in the Calendar
Year, and (iv) deducting from the product arrived at in (iii) the amount of any quarterly royalty payments already paid for that Calendar Year. In any event, a reconciliation or
"true-up" shall occur in connection with the final royalty payment, if any, of each Calendar Year such that the net amount of all royalty payments made for the Calendar Year equals the
royalty arrived pursuant to the schedule above based on Net Sales throughout the entire Calendar Year. 

If
the annual royalty payable to Banner as required above is less than [$***], First Horizon shall pay Banner the "shortfall"
such that for each Calendar Year, the royalty plus any "shortfall" shall be at least [$***]. 

As
used in this Section 3.6, "Net Sales" shall mean amounts invoiced for sales of the Products by SaSy, its affiliates and sublicensees to third parties in the United States, but deducting the
following where allowed based on Generally Accepted Accounting Principles: packing; freight; customary and reasonable rebates, chargebacks, sales returns, allowances and trade discounts; and any sales
tax payable. 

SaSy
shall keep accurate books and records in accordance with generally accepted accounting principles showing all information required to calculate the amounts payable under this
Section 3.6.1. Such books and records will be preserved for at least three (3) years from the date of the payment to which they relate." 

	5.
	Section 3.6.2 shall be amended by replacing each instance of "Gross Sales" with "Net Sales".

	6.
	Section 12.5(iii) shall be replaced with: "Products shall be gelatin enrobed using the patented "Soflet®
technology which is described by U.S. Patents 5,146,730; 5,459,983; and 6,482,516."

	7.
	Appendix A shall be replaced with following: 

"Banner
agrees to the Cores being the solid caplet and/or tablet dosage form(s) provided or to be provided by First Horizon meeting such Specifications as are agreed by the parties. It is understood
First Horizon may change the ingredient mix of the Cores. Banner shall agree to such change so long as there are no safety concerns, it is feasible to enrobe such Cores and Banner's cost to do so is
not more than its cost to enrobe the Cores that Banner initially enrobed for First Horizon hereunder. If the cost is more, Banner shall give advance notice to First Horizon and if First Horizon elects
to proceed with enrobement, then First Horizon shall pay Banner any such incremental cost. 

	C.
	Effectuation

The
amendments to the Supply Agreement contemplated by this Amendment shall be deemed effective as of the date hereof without any further action required by the parties hereto. 

	D.
	Counterparts

This
Amendment may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. One or more counterparts
of this Amendment may be delivered by facsimile, and delivery by such means shall have the same effect as delivery of an original counterpart hereof. 

        Executed
as of this            day of                        , 2003.

	BANNER PHARMACAPS INC.	 	FIRST HORIZON PHARMACEUTICAL CORPORATION
	 	 	 	 	 
	 	 	 	 	 
	BY:	    /s/                                    
            
	 	BY:	    /s/                                    
            

	ITS:	    /s/                                    
            
	 	ITS:	    /s/                                    
            

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FIRST AMENDMENT TO SUPPLY AGREEMENT BETWEEN BANNER PHARMACAPS INC. AND FIRST HORIZON PHARMACEUTICAL CORPORATION AS ASSIGNEE OF SANOFI-SYNTHELABO INC.QuickLinks
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Exhibit 10.3    
    

 
 

AMENDED AND RESTATED
  EMPLOYMENT AGREEMENT    
    

        This AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this "Agreement") is made and entered into as of the 17 day of September, 2003, by and between FIRST
HORIZON PHARMACEUTICAL CORPORATION, a Delaware corporation (the "Company") and PATRICK FOURTEAU ("Executive"). 

 
 

WITNESSETH:    
    

        WHEREAS, Executive is employed by the Company pursuant to the terms and conditions of that certain Employment Agreement dated May 16, 2003 between the
Company and Executive (the "Original Agreement"): and 

        WHEREAS,
the parties desire to amend and restate the terms and conditions of the Original Agreement, effective as of the date hereof; 

        NOW,
THEREFORE, in consideration of Executive's employment or continued employment, the covenants and mutual agreements set forth herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto do hereby agree as follows: 

	1.
	Employment.    Throughout the Term (as defined in Section 2 below), the Company shall employ Executive as provided
herein, and Executive hereby accepts such employment. In accepting such employment, Executive states that, to the best of his knowledge, he is not now, and by accepting such employment, will not be,
under any restrictions in the performance of the duties contemplated under this Agreement as a result of the provisions of any prior employment agreement or non-compete or similar
agreement to which Executive is or was a party.

	2.
	Term of Employment.    The term of Executive's employment by the Company hereunder commenced on May 16, 2003 (the
"Effective Date") and shall continue thereafter unless sooner terminated as a result of Executive's death or in accordance with the provisions of Section 6 below (the "Term").

	3.
	Duties.    Throughout the Term, and except as otherwise expressly provided herein, Executive shall be employed by the Company
as the President and Chief Operating Officer of the Company. Executive shall devote his full time to the performance of his duties as President and Chief Operating Officer of the Company in accordance
with the Company's By-laws, this Agreement and the directions of the Company's Board of Directors and any executive officer of the Company who is senior to Executive. Without limiting the
generality of the foregoing, throughout the Term Executive shall faithfully perform his duties as President and Chief Operating Officer at all times so as to promote the best interests of the Company.

	4.
	Compensation.

	(a)
	Salary.    For any and all services performed by Executive under this Agreement during the Term, in whatever capacity, the
Company shall pay to Executive an annual salary of Two Hundred Nine Thousand Dollars ($209,000.00) per year (the "Salary") less any and all applicable federal, state and local payroll and withholding
taxes. The Salary shall be paid in the same increments as the Company's normal payroll, but no less frequent than bi-monthly and prorated, however, for any period of less than a full
month. The Salary will be reviewed annually by the Compensation Committee of the Board and a determination shall be made at that time as to the appropriateness of an increase, if any, thereto. 

 

	(b)
	Bonus.    In addition to the Salary, Executive shall be eligible to receive from the Company an incentive compensation bonus
(the "Bonus") based on a percentage of his Salary. The Bonus, if any, shall be determined based on such criteria as shall be determined from time to time by the Compensation Committee of the Board of
Directors. The nature of the criteria and the determination as to whether the criteria have been satisfied, shall be determined by the Compensation Committee of the Board in its sole discretion.
Accordingly, there is no assurance that a Bonus will be paid to Executive with respect to all or any particular year during the Term.

	5.
	Benefits and Other Rights.    In consideration for Executive's performance under this Agreement, the Company shall provide to
Executive the following benefits:

	(a)
	The
Company will provide Executive with cash advances for or reimbursement of all reasonable out-of-pocket business expenses incurred by Executive in
connection with his employment hereunder. Such reimbursement, however, is conditioned upon Executive adhering to any and all reasonable policies established by Company from time to time with respect
to such reimbursements or advances including, but not limited to, a requirement that Executive submit supporting evidence of any such expenses to the Company.

	(b)
	The
Company will provide Executive and his family with the opportunity to receive group medical coverage under the terms of the Company's health insurance plan, but subject to
completion of normal waiting periods. During any such waiting period, the Company will pay, or reimburse Executive for, the cost of COBRA coverage for Executive and his family under his prior health
plan.

	(c)
	During
the Term the Executive shall be entitled to fifteen (15) days paid vacation, it being understood and agreed that unused vacation shall not be carried over from one year
to the next. In addition, Executive shall be entitled to eight (8) paid holidays and four (4) paid personal days off.

	(d)
	The
Company will pay Executive's reasonable moving costs for the relocation of his residence to the Atlanta, Georgia metropolitan area, subject to the approval of such moving costs by
the Compensation Committee of the Company's Board of Directors.

	6.
	Termination of the Term.

	(a)
	The
Company shall have the right to terminate the Term under the following circumstances:

	(i)
	Executive
shall die;

	(ii)
	With
or without Cause, effective upon written notice to Executive by the Company; or

	(iii)
	Upon
or within one (1) year following a Change of Control.

	(b)
	Executive
shall have the right to terminate the Term under the following circumstances:

	(i)
	At
any time upon sixty (60) days prior written notice to the Company; or

	(ii)
	For
Good Reason upon or within one (1) year following a Change of Control.

	(c)
	For
purposes of this Agreement, "Cause" shall mean:

	(i)
	Executive
shall be convicted of the commission of a felony or a crime involving dishonesty, fraud or moral turpitude; 

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	(ii)
	Executive
has engaged in acts of fraud, embezzlement, theft or other dishonest acts against the Company;

	(iii)
	Executive
commits an act which negatively impacts the Company or its employees including, but not limited to, engaging in competition with the Company, disclosing confidential
information or engaging in sexual harassment, discrimination or other human rights-type violations;

	(iv)
	Executive's
gross neglect or willful misconduct in the discharge of his duties and responsibilities; or

	(v)
	Executive's
repeated refusal to follow the lawful direction of the Board of Directors or supervising officers.

	(d)
	For
purposes of this Agreement, "Change of Control" shall mean the occurrence of any of the following:

	(i)
	The
acquisition (other than by a direct purchase of shares from the Company) by any "person," including a "syndication" or "group", as those terms are used in Section 13(d)(3)
or 14(d)(2) of the Securities Exchange Act of 1934, as amended (other than any such person currently owning in excess of the following amount), of securities representing 20% or more of the combined
voting power of the Company's then outstanding voting securities, which is any security that ordinarily possesses the power to vote in the election of the Board of Directors of a corporation without
the happening of any precondition or contingency;

	(ii)
	The
Company is merged or consolidated with another corporation and immediately after giving effect to the merger or consolidation less than 80% of the outstanding voting securities
of the surviving or resulting entity are then beneficially owned in the aggregate by (x) the stockholders of the Company immediately prior to such merger or consolidation, or (y) if a
record date has been set to determine the stockholders of the Company entitled to vote on such merger or consolidation, the stockholders of the Company as of such record date;

	(iii)
	If
at any time during a calendar year a majority of the directors of the Company are not persons who were directors at the beginning of the calendar year; or

	(iv)
	The
Company transfers substantially all of its assets to another corporation which is a less than 80% owned subsidiary of the Company.

	(e)
	For
purposes of this Agreement, "Good Reason" shall mean the occurrence of any one or more of the following events which continues uncured for a period of not less thirty
(30) days following written notice given by Executive to the Company within fifteen (15) days following the occurrence of such event, unless the Executive specifically agrees in writing
that such event shall not be Good Reason:

	(i)
	Any
material breach of this Agreement by the Company;

	(ii)
	Any
failure to continue the Executive as an executive officer of the Company;

	(iii)
	The
requirement by the Company that Executive perform his services hereunder primarily at a location outside of the metropolitan Atlanta, Georgia area; or

	(iv)
	The
reduction of the Employee's salary below the amount set forth in Section 4(a) above without the written consent of Executive. 

3

 

	7.
	Effect of Expiration or Termination of the Term.    Promptly following the termination of the Term, and except as otherwise
expressly agreed to by the Company in writing, Executive shall:

	(a)
	Immediately
resign from any and all other positions or committees which Executive holds or is a member of with the Company or any subsidiary of the Company including, but not limited
to, as an officer and director of the Company or any subsidiary of the Company.

	(b)
	Provide
the Company with all reasonable assistance necessary to permit the Company to continue its business operations without interruption and in a manner consistent with reasonable
business practices; provided, however, that such transition period shall not exceed thirty (30) days after termination nor require more than twenty (20) hours of Executive's time per
week and Executive shall be promptly reimbursed for all out-of-pocket expenses.

	(c)
	Deliver
to the Company possession of any and all property owned or leased by the Company which may then be in Executive's possession or under his control, including, without
limitation, any and all such keys, credit cards, automobiles, equipment, supplies, books, records, files, computer equipment, computer software and other such tangible and intangible property of any
description whatsoever. If, following the expiration or termination of the Term, Executive shall receive any mail addressed to the Company, then Executive shall immediately deliver such mail, unopened
and in its original envelope or package, to the Company.

	(d)
	Other
than as provided in this Section 7, upon a termination of employment all other benefits and/or entitlements to participate in programs or benefits, if any, will cease as
of the effective date except medical insurance coverage that may be continued at Executive's own expense as provided by applicable law or written Company policy.

	(e)
	Upon
termination of Executive pursuant to § 6(a)(i) or § 6(a)(ii) without Cause following the six (6) month anniversary of the Effective
Date, the Company shall: (i) provide Executive with Salary continuance, subject to § 7(h) for twelve (12) months (a "Salary Continuance") at the rate in effect immediately
prior to termination, plus (ii) a lump sum payment equal to One Hundred Percent (100%) of the Bonus, if any, paid to Executive for the calendar year immediately preceding termination, plus
(iii) provide twelve (12) months of COBRA coverage for Executive which shall be substantially equivalent to that provided by the Company prior to termination, plus (iv) all of
Executive's then unvested options previously issued pursuant to the Company's stock option plans shall immediately vest and be exercisable as herein provided. In the event of termination of
Executive's employment prior to the six (6) month anniversary of the Effective Date. Executive shall not be entitled to any severance from the Company.

	(f)
	Upon
termination of Executive pursuant to § 6(a)(ii) with Cause or § 6(b)(i), the Company shall pay Executive or Executive's estate all Salary accrued
but unpaid as of the date of such termination.

	(g)
	Upon
termination of Executive pursuant to § 6(a)(iii) or § 6(b)(ii), the Company shall: (i) provide Executive with Salary continuance for
twenty-four (24) months at the rate in effect immediately prior to termination, plus (ii) a lump sum payment equal to Two Hundred Percent (200%) of the Bonus, if any, paid to
Executive for the calendar year immediately preceding termination, plus (iii) provide COBRA coverage for Executive which shall be substantially equivalent to that provided by the Company prior
to termination until the earlier of (A) twenty-four (24) months after the date of termination, (B) the availability of replacement coverage to Executive from a third
party employer after Executive has accepted another full-time position and (C) the expiration of COBRA benefits by reason or lapse of the statutory or regulatory benefit period
established 

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	by
governmental authority, plus (iv) all of Executive's then unvested options previously issued pursuant to the Company's stock option plans shall
immediately vest and be exercisable as herein provided.

	(h)
	In
the event that Executive shall be entitled to receive a Salary Continuance and COBRA benefit pursuant to § 7(e), such Salary Continuance and COBRA benefit shall
continue only until such time as Executive shall have accepted another full time position. In addition, in the event that Executive shall perform consulting or other services for which he shall
receive compensation, all compensation shall be reported to the Company and shall be offset against any remaining Salary Continuance payments. Failure of Executive to promptly report the receipt of
any compensation from a third party or the acceptance of a new position shall entitle the Company to terminate all remaining Salary Continuance and COBRA benefits and to seek restitution for any
payments made to Executive subsequent to such job acceptance or compensation receipt.

	(i)
	Any
dollar amounts which are to be paid at the time of termination under this Section 7, other than Salary Continuance, payments under Section 7(g)(i) and COBRA
payments, shall be paid within thirty (30) days after the date of termination. Any Salary Continuance, payments under Section 7(g)(i) or COBRA payments shall be made in accordance
with the usual payroll practices which were applicable prior to termination. Except as otherwise specifically set forth herein, any and all payments made pursuant to this Agreement shall be net of any
and all applicable federal, state and local payroll and withholding taxes.

	(j)
	If
the Company or the Company's accountants determine that the payments called for under Section 7(g) of this Agreement either alone or in conjunction with any other payments
or benefits made available to the Employee by the Company will result in the Employee being subject to an excise tax ("Excise Tax") under Section 4999 of the Internal Revenue Code of 1986, as
amended (the "Code"), or if an Excise Tax is assessed against Executive as a result of such payments or other benefits, the Company shall make a Gross-Up Payment (as defined below) to or
on behalf of Executive as and when such determination(s) and assessments(s), as appropriate, are made, subject to the conditions of this subsection (i). A "Gross-Up Payment" shall mean a
payment to or on behalf of Executive that shall be sufficient to pay (i) any Excise Tax in full, (ii) any federal, state and local income tax and Social Security or other employment tax
on the payment made to pay such Excise Tax as well as any additional Excise Tax on the Gross-Up Payment, and (iii) any interest or penalties assessed by the Internal Revenue Service
on Executive if such interest or penalties are attributable to the Company's failure to comply with its obligations under this subsection (i) or applicable law. Any determination under this
subsection (i) by the Company or the Company's accountants shall be made in accordance with Section 280G of the Code, any applicable related regulations (whether proposed, temporary or
final), any related Internal Revenue Service rulings and any related case law, and shall assume that Executive shall pay Federal income taxes at the highest marginal rate in effect for the year in
which the Gross-Up Payment is made and state and local income taxes at the highest marginal rate in effect in the state of Executive's residence for such year. Executive shall take such
action (other than waiving Employee's right to any payments or benefits) as the Company reasonably requests under the circumstances to mitigate or challenge such tax. If the Company reasonably
requests that Executive take action to mitigate or challenge, or to mitigate and challenge, any such tax or assessment and Executive complies with such request, the Company shall provide Executive
with such information and such expert advice and assistance from the 

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	Company's
accountants, lawyers and other advisors as Executive may reasonably request and shall pay for all expenses incurred in effecting such compliance
and any related fines, penalties, interest and other assessments. Subject to the provisions of this subsection (i), all determinations required to be made under this subsection (i), including whether
and when a Gross-Up Payment is required and the amount of such Gross-Up Payment and the assumptions to be utilized in arriving at such determination, shall be made by the
public accounting firm that is retained by the Company as of the date immediately prior to the Change of Control (the "Accounting Firm") which shall provide detailed supporting calculations both to
the Company and Executive within thirty (30) business days of the receipt of notice from the Company or Executive that there has been a payment that could trigger a Gross-Up
Payment, or such earlier time as is requested by the Company (collectively, the "Determination"). In the event that the Accounting Firm is serving as accountant or auditor for the individual, entity
or group effecting the Change of Control, Executive may appoint another nationally recognized public accounting firm to make the determinations required hereunder (which accounting firm shall then be
referred to as the Accounting Firm hereunder). All fees and expenses of the Accounting Firm shall be borne solely by the Company and the Company shall enter into any agreement requested by the
Accounting Firm in connection with the performance of the services hereunder. The Gross-Up Payment under this subsection (i) with respect to any payments shall be made no later than
sixty (60) days following such payments. If the Accounting Firm determines that no Excise Tax is payable by Executive, it shall furnish Executive with a written opinion to such effect, and to
the effect that failure to report the Excise Tax, if any, on Executive's applicable federal income tax return will not result in the imposition of a negligence or similar penalty. The Determination by
the Accounting Firm shall be binding upon the Company and Executive. As a result of the uncertainty in the application of Section 4999 of the Code at the time of the Determination, it is
possible that Gross-Up Payments which will not have been made by the Company should have been made ("Underpayment") or Gross-up Payments are made by the Company which should
not have been made ("Overpayment"), consistent with the calculations required to be made hereunder. In the event that Executive thereafter is required to make payment of any additional Excise Tax, the
Accounting Firm shall determine the amount of the Underpayment that has occurred and any such Underpayment (together with interest at the rate provided in Section 1274(b)(2)(B) of the Code)
shall be promptly paid by the Company to or for the benefit of Executive. In the event the amount of the Gross-Up Payment exceeds the amount necessary to reimburse Executive for his Excise
Tax as herein set forth, the Accounting Firm shall determine the amount of the Overpayment that has been made and any such Overpayment (together with interest at the rate provided in
Section 1274(b)(2) of the Code) shall be promptly paid by Executive to or for the benefit of the Company. Executive shall cooperate, to the extent Executive's expenses are reimbursed by the
Company, with any reasonable requests by the Company in connection with any contests or disputes with the Internal Revenue Service in connection with the Excise Tax.

	8.
	Restrictive Covenants for Executive.    Executive hereby covenants and agrees with the Company that for so long as Executive
is employed by the Company and for a period (the "Restricted Period") of twelve months after the termination of such employment for any reason, Executive shall not, without the prior written consent
of the Company, which consent shall be within the sole and exclusive discretion of the Company, either directly or indirectly on his own account or on behalf of any other person or entity:

	(a)
	Perform
services for a Competing Business that are substantially similar in whole or in part to those that he performed for the Company in his role as Chief Operating Officer,
including specifically, but not limited to, 

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	the
sale or marketing of drug products or the management of individuals involved in the sale or marketing of drug products. For purposes of this covenant,
the term "Competing Business" shall mean any company engaged in the development, marketing or sale of prescription drug products, including generic and nongeneric drug products, which are competitive
with: (1) those products being marketed by the Company at the time of Executive's termination; or (2) those products that Executive was aware were under development by the Company and
expected to be marketed within two years of Executive's termination. This covenant shall apply only within the "Territory" which is defined as the fifty states of the United States. Executive
recognizes and agrees that in capacity of Chief Operating Officer, his duties extend throughout the entire service area of the Company which includes, at a minimum, the fifty states of the United
States and that, because of the executive nature of Executive's position with the Company, in order to afford the Company protection from unfair competition by the Executive following his termination
of employment, this covenant must extend throughout the stated Territory. Executive further acknowledges that this covenant does not prohibit him from engaging in his entire trade or business but only
a very limited segment of the pharmaceuticals industry

	(b)
	Solicit
any current supplier, customer or client of the Company with whom Executive dealt, or with whom anyone in Executive's direct chain of command dealt, on behalf of the Company
within the year preceding Executive's termination of employment, for the purpose of purchasing drug products (or ingredients of drug products) or selling or marketing drug products, including generic
and nongeneric drug products, which are competitive with: (1) those products being marketed by the Company at the time of Executive's termination; or (2) those products that Executive
was aware were under development by the Company and expected to be marketed within two years of Executive's termination. Notwithstanding this subsection (b), Executive may solicit suppliers that have
excess capacity as reasonably determined by the Company.

	9.
	Confidentiality.    Attached to this Agreement as Exhibit A is the form of the Employee/Independent Contractor
Confidentiality and Non-Solicitation Agreement (the "Confidentiality Agreement") which the Company requires all employees, including, but not limited to, the Executive, to execute and
which is a part of each employee's terms of employment. By signing this Agreement, Executive acknowledges having received, read, executed and delivered to the Company a copy of the Confidentiality
Agreement and agrees that the terms of the Confidentiality Agreement shall be incorporated by reference into this Agreement and shall be considered as part of the terms and conditions of Executive's
continued employment with the Company.

	10.
	Remedies.

	(a)
	The
covenants of Executive set forth in Section 8 and Section 9 are separate and independent covenants for which valuable consideration has been paid, the receipt,
adequacy and sufficiency of which are acknowledged by Executive, and have also been made by Executive to induce the Company to enter into this Agreement and continue Executive's employment with the
Company. Each of the aforesaid covenants may be availed of, or relied upon, by the Company in any court of competent jurisdiction, and shall form the basis of injunctive relief and damages including
expenses of litigation (including, but not limited to, reasonable attorney's fees upon trial and appeal) suffered by the Company arising out of any breach of the aforesaid covenants by Executive. The
covenants of Executive set forth in this Section 10 are cumulative to each other and to all other covenants of Executive in favor of the Company contained in this Agreement and shall survive
the termination of this Agreement for the purposes intended. 

7

 

	(b)
	Each
of the covenants contained in Section 8 and Section 9 above shall be construed as agreements which are independent of any other provision of this Agreement, and the
existence of any claim or cause of action by any party hereto against any other party hereto, of whatever nature, shall not constitute a defense to the enforcement of such covenants. If any of such
covenants shall be deemed unenforceable by virtue of its scope in terms of geographical area, length of time or otherwise, but may be made enforceable by the imposition of limitations thereon,
Executive agrees that the same shall be enforceable to the fullest extent permissible under the laws and public policies of the jurisdiction in which enforcement is sought. The parties hereto hereby
authorize any court of competent jurisdiction to modify or reduce the scope of such covenants to the extent necessary to make such covenants enforceable.

	(c)
	In
the event that Executive believes that the Company is in violation of a material obligation owed to Executive under this Agreement, and the Executive has given notice of such
violation to the Company requesting that the Company cure such violation, and within twenty (20) business days the Company has not undertaken steps to cure such violation or to provide
information to Executive demonstrating that the Company is not in violation of the Agreement, and as a result of such failure to cure or dispute such violation, the Executive terminates the Agreement
in accordance with Section 6(b), Executive shall not be barred from seeking employment with a competitor notwithstanding the restriction of Section 8(a); provided, however, that all
other restrictions contained in this Agreement, including, but not limited to the covenants in Section 8(b) and in Section 9, shall remain in full force and effect.

	11.
	Enforcement Costs.    If any legal action or other proceeding is brought for the enforcement of this Agreement, or because of
an alleged dispute, breach, default or misrepresentation in connection with any provisions of this Agreement, the successful or prevailing party or parties shall be entitled to recover reasonable
attorney's fees, court costs and all expenses even if not taxable as court costs (including, without limitation, all such fees, costs and expenses incident to appeal and other post judgment
proceedings), incurred in that action or proceeding, in addition to any other relief to which such party or parties may be entitled. Attorneys fees shall include, without limitation, paralegal fees,
investigative fees, administrative costs, sales and use taxes and all other charges billed by the attorney to the prevailing party.

	12.
	Notices.    Any and all notices necessary or desirable to be served hereunder shall be in writing and shall be:

	(a)
	Personally
delivered, or

	(b)
	Sent
by certified mail, postage prepaid, return receipt requested, or guaranteed overnight delivery by a nationally recognized express delivery company, in each case addressed to the
intended recipient at the address set forth below.

	(c)
	For
notices sent to the Company: 

First
Horizon Pharmaceutical Corporation

6195 Shiloh Road

Alpharetta, Georgia 30005

Telephone No.: (770) 442-9707

Facsimile No.: (770) 442-9594 

8

 

	(d)
	For
notices sent to Executive: 

Mr.
Patrick Fourteau

160 Prospect Ave.

Gilford, CT 06437 

Either
party hereto may amend the addresses for notices to such party hereunder by delivery of a written notice thereof served upon the other party hereto as provided herein. Any notice sent by
certified mail as provided above shall be deemed delivered on the third (3rd) business day next following the postmark date which it bears. 

	13.
	Entire Agreement.    This Agreement sets forth the entire agreement of the parties hereto with respect to the subject matter
hereof, and specifically supercedes any other agreement or understanding among the parties hereto related to the subject matter hereof, including, without limitation, the Original Agreement. This
Agreement may not be modified or revised except pursuant to a written instrument signed by the party against whom enforcement is sought.

	14.
	Severability.    The invalidity or unenforceability of any provision hereof shall not affect the enforceability of any other
provision hereof, and except as otherwise provided in Section 10 above, any such invalid or unenforceable provision shall be severed from this Agreement.

	15.
	Waiver.    Failure to insist upon strict compliance with any of the terms or conditions hereof shall not be deemed a waiver
of such term or condition, and the waiver or relinquishment of any right or remedy hereunder at any one or more times shall not be deemed a waiver or relinquishment of such right or remedy at any
other time or times.

	16.
	Arbitration.    Any claims, disputes or controversies arising out of or relating to this Agreement between the parties (other
than those arising under Section 10) shall be submitted to arbitration by the parties. The arbitration shall be conducted in Atlanta, Georgia in accordance with the rules of the American
Arbitration Association then in existence and the following provisions: Either party may serve upon the other party by guaranteed overnight delivery by a nationally recognized express delivery
service, written demand that the dispute, specifying in detail its nature, be submitted to arbitration. Within seven business days after the service of such demand, each of the parties shall appoint
an arbitrator and serve written notice by guaranteed overnight delivery by a nationally recognized express delivery service, of such appointment upon the other party. The two arbitrators appointed
shall appoint a third arbitrator. The decision of two arbitrators in writing under oath shall be final and binding upon the parties. The arbitrators shall decide who is to pay the expenses of the
arbitration. If the two arbitrators appointed fail to agree upon a third arbitrator within ten days after their appointment, then an application may be made by either party, upon notice to the other
party, to any court of competent jurisdiction for the appointment of a third arbitrator, and any such appointment shall be binding upon both parties.

	17.
	Governing Law.    This Agreement and the rights and obligations of the parties hereto shall be governed by and construed in
accordance with the law of the State of Georgia, without regard to its conflicts of laws provisions. Subject to Section 16, each party hereto hereby (a) agrees that the state and federal
courts of the Northern District of Georgia shall have exclusive jurisdiction and venue of any litigation which may be initiated with respect to this Agreement or to enforce rights granted hereunder
and (b) consents to the personal jurisdiction and venue of such courts for such purposes.

	18.
	Benefit and Assignability.    This Agreement shall inure to the benefit of and be binding upon the Company and its successors
and assigns. The rights and obligations of Executive hereunder are personal to him, and are not subject to voluntary or involuntary alienation, transfer, delegation or assignment. 

9

 

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

	 	 	EXECUTIVE:
	

 	
 	

/s/ PATRICK FOURTEAU
 Name: Patrick Fourteau
	

 	
 	

FIRST HORIZON PHARMACEUTICAL CORPORATION
	

 	
 	

By:	
 	

/s/ DARRELL BORNE

	 	 	Its:	 	CFO

10

QuickLinks

Exhibit 10.3

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

WITNESSETH

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