Related Party Transactions and Outside Related Director Information

Impax Laboratories, Inc. (IPXL.PK)

4/12/2004 Proxy Information

Consulting Agreement. In May 2002, the Company entered into a two-year consulting agreement with Ann Hsu, Ph.D., the wife of Larry Hsu, Ph.D., the President and a Director of the Company. Dr. Ann Hsu provides clinical development consulting services. Under the agreement, Dr. Ann Hsu is entitled to an annual fee of $204,000 plus an annual bonus of up to $50,000 based on the achievement of agreed-upon goals. Dr. Ann Hsu also received an option to purchase 80,000 shares of Common Stock at an exercise price of $7.10 per share that becomes exercisable in three equal, annual installments beginning in May 2003. Dr. Ann Hsu was paid $190,723 for services rendered in 2003.