Dear employee/former employee,
Exhibit 4.3
August 10, 2005
Dear employee/former employee,
We refer to the Amended and Restated Employee Stockholders Agreement by and among Endo
Pharmaceuticals Holdings Inc. (the “Company”), Xxxxx Investment Associates V, L.P. (together with
Xxxxx Equity Partners V, L.P., “Xxxxx”), Endo Pharma LLC (“Endo LLC”) and the stockholders of the
Company party thereto (the “Employee Stockholders”), dated as of July 14, 2000, as amended and
restated on June 5, 2003, and as amended on June 28, 2004 (the “Employee Stockholders Agreement”).
All capitalized terms used herein, and not otherwise defined, shall have the meanings assigned to
them in the Employee Stockholders Agreement.
Pursuant to Section 7.5 of the Employee Stockholders Agreement, the Employee Stockholders
Agreement may be amended by Employee Stockholders owning a majority of the outstanding shares of
Common Stock then owned by all Employee Stockholders. By executing this letter agreement, you
hereby agree to Amendment 2 to the Employee Stockholders Agreement, in the form set forth as Annex
A hereto.
Pursuant to Section 7.5 of the Employee Stockholders Agreement, Endo LLC may, at any time in
its sole discretion, release all or a portion of any Employee Stockholder’s shares of Common Stock
from the Employee Stockholders Agreement, and upon such release, such Employee Stockholder will no
longer be entitled to the benefits under the Employee Stockholders Agreement with respect to such
shares of Common Stock. Subject to and upon the effectiveness of this letter agreement and subject
to your execution of this letter agreement and Amendment 2 to the Employee Stockholders Agreement,
in the form set forth as Annex A hereto, Endo LLC hereby releases you from the Employee
Stockholders Agreement.
Effective upon your release from the Employee Stockholders Agreement, you hereby acknowledge
that you will no longer be entitled to any benefits under the Employee Stockholders Agreement with
respect to shares of Common Stock owned by you now or in the future, including shares of Common
Stock (i) to be received to you upon exercise of stock options under the Amended and Restated 1997
Employee Stock Option Plan and the Amended and Restated 2000 Supplemental Employee Stock Option
Plan (collectively, the “Option Plans”), and (ii) acquired by you pursuant to the 1997 Employee
Stock Purchase Plan.
Effective on October 24, 2005, upon your release from the Employee Stockholders Agreement, and
payment of all applicable taxes, you will no longer be bound by the restrictions on transfer of
shares of Common Stock set forth in Article I of the Employee Stockholders Agreement. To provide
for an orderly sale of shares of Common Stock, you hereby agree that, beginning on October 24, 2005
(or such earlier date as the Company may inform you) until January 1, 2006, you will not sell more
than 10% of your shares of Common Stock on any single day and you will not sell more than an
aggregate of 25% of your shares in any calendar week. The references to “your shares” in the
preceding sentence mean the number of shares of Common Stock set forth on the signature page
hereto. After January 1, 2006, you will no longer be bound by the above volume restrictions.
Shares of Common Stock issuable upon exercise of stock options under the Endo Pharmaceuticals
Holdings Inc. 2004 Stock Incentive Plan and the Endo Pharmaceuticals Holdings Inc. 2000 Stock
Incentive Plan will not be subject to the restrictions on sale set forth in this paragraph. You
hereby acknowledge that all sales of shares of Common Stock by you will be made in compliance with
the Company’s xxxxxxx xxxxxxx policy (if applicable), which is available on the Company’s intranet
site, and all applicable federal and state securities laws.
In connection with your release from the Employee Stockholders Agreement, you hereby waive any
and all rights you may have now or in the future under Section 5.6(d) of the Employee Stockholders
Agreement and Schedule 1 thereto with respect to the registration of shares of Common Stock on the
Registration Statement on Form S-3, as amended, filed by the Company with the Securities and
Exchange Commission on April 30, 2004 relating to the sale of up to 30,000,000 shares of Common
Stock by Endo LLC and the other selling shareholders for whom shares were reserved therein (the
“Shelf Registration Statement”). To the extent you elected to participate as a selling shareholder
in the Shelf Registration Statement, you hereby (i) consent to (a) be removed as a selling
shareholder; (b) have the shares reserved for sale by you reallocated to any of the other selling
shareholders named therein; and (c) to have any increase pursuant to Rule 462(b) of the Act in the
number of shares registered under the Shelf Registration Statement allocated to any of the other
selling shareholders named therein; and (ii) agree to take such actions as may be requested by the
Company to terminate the custody arrangements made in June 2004 in connection with the Shelf
Registration Statement, and to withdraw your shares from any such arrangements, including executing
the termination of custody agreement and power of attorney, in the form set forth as Annex B
hereto. In addition, you hereby waive any and all rights you may have now or in the future with
respect to the registration of shares of Common Stock under the Securities Act of 1933, including
any rights you may have pursuant to Article V of the Employee Stockholders Agreement, and any
rights you may have pursuant to the Registration Rights Agreement by and between the Company and
Endo LLC, dated as of July 17, 2000, as amended as of June 30, 2003 or the Shelf Registration
Agreement by and between the Company and Endo LLC, dated as of April 30, 2004, as amended as of
June 10, 2004.
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This letter agreement will become effective for all Employee Stockholders who have executed
it, upon its execution by the Company, Endo LLC, Xxxxx and Employee Stockholders owning a majority
of the outstanding shares of Common Stock then owned by all Employee Stockholders. We will inform
you when this letter agreement is effective by a further communication.
Please acknowledge your agreement with the foregoing by signing and dating below.
| Yours truly, ENDO PHARMACEUTICALS HOLDINGS INC. |
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| By: | /s/ Xxxxxxx X. Xxxxx | |||
| Name: Xxxxxxx X. Xxxxx | ||||
| Title: Chief Financial Officer | ||||
| ENDO PHARMA LLC |
||||
| By: | /s/ Xxxxxxx X. Xxxxx | |||
| Name: Xxxxxxx X. Xxxxx | ||||
| Title: Chief Financial Officer | ||||
| XXXXX INVESTMENT ASSOCIATES V, L.P. By: Xxxxx Partners V, L.P., General Partner |
||||
| By: | /s/ Xxxxx X. Xxxxxxxxxx | |||
| Name: | ||||
| Title: | ||||
AGREED TO AND ACKNOWLEDGED BY:
/s/ [Employee Stockholder] |
Total number of shares of Common Stock: __________________
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