Exhibit 10.22

 

SETTLEMENT AGREEMENT

 

This Settlement Agreement (including Exhibits A, B, and C, the “Agreement”) is
made and entered into this 21st day of December, 2018 (the “Execution Date”), by
and between, on the one hand, Neos Therapeutics, Inc. and Neos Therapeutics, LP
(collectively, “Neos”), and on the other hand, Teva Pharmaceuticals USA, Inc.
(“Teva”) (collectively, the “Parties,” or each separately, a “Party”).

 

RECITALS

 

A.                                    WHEREAS Neos owns U.S. Patent Nos.
8,840,924 (“the ‘924 Patent”), 9,072,680 (“the ‘680 patent”), and 9,089,496
(“the ‘496 Patent”), which patents are listed in the U.S. Food and Drug
Administration (“FDA”) publication Approved Drug Products With Therapeutic
Equivalence Evaluations in connection with COTEMPLA XR-ODT™ brand
methylphenidate extended-release orally disintegrating tablets, which products
Neos sells in the United States of America, including its territories,
possessions, and the Commonwealth of Puerto Rico (the “Territory”), under New
Drug Application (“NDA”) No. 205489;

 

B.                                    WHEREAS Teva provided notice to Neos that
it has submitted a 21 U.S.C. § 355(j)(2)(A)(vii)(IV) certification (“Paragraph
IV Certification”) to, and seeks approval from, the FDA to market the generic
extended-release orally disintegrating tablets containing 8.6 mg, 17.3 mg, or
25.9 mg of methylphenidate that are described in Abbreviated New Drug
Application (“ANDA”) 210924, prior to the expiration of the ‘924 Patent, the
‘680 Patent, and the ‘496 Patent;

 

C.                                    WHEREAS Neos has prosecuted, and Teva has
defended, an action for patent infringement in the United States District Court
for the District of Delaware (the “Court”) regarding the generic
extended-release orally disintegrating tablets that are described in ANDA 210924
and the Paragraph IV Certification, which action is captioned Neos
Therapeutics, Inc. et al. v. Teva Pharmaceuticals USA, Inc., Civil Action
No. 17-1793-CFC (the “Action”);

 

D.                                    WHEREAS, subject to the terms and
conditions herein, Neos has agreed to grant Teva a non-exclusive license and
sublicense, as applicable, to manufacture, have manufactured, use, sell, offer
to sell, import, and distribute the generic extended-release orally
disintegrating tablets described in  the Teva ANDA (as defined in the License
Agreement) in or for the Territory as of the date, and upon the terms, set forth
in the License Agreement defined and referred to in Section 2 of this Settlement
Agreement;

 

E.                                     WHEREAS, as a result of this Settlement
Agreement, there may be supply and sales in or for the Territory of the generic
extended-release orally disintegrating tablets described in the Teva ANDA in
advance of the expiration of the above-identified patents, which supply and
sales otherwise may not have occurred until after the expiration of the asserted
patents; and

 

F.                                      WHEREAS the Parties are willing to
settle the Action on the terms set forth herein.

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

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NOW THEREFORE, in consideration of the promises and mutual covenants set forth
herein, the sufficiency of which is hereby acknowledged, the Parties hereby
agree as follows.

 

1.                                      Stipulation And Order.  In consideration
of the mutual benefits of entering into this Agreement, the Parties shall enter
into and cause to be filed with the Court, within three (3) days of the
Execution Date, a stipulation and order resolving the Action, substantially in
the form annexed hereto as Exhibit A (the “Stipulation And Order”).  If the
Court does not grant the Stipulation And Order substantially in the form annexed
hereto as Exhibit A, the Parties agree to confer in good faith and revise that
document consistent with the requirements of the Court.

 

2.                                      License Agreement.  Contemporaneously
with the execution of this Agreement, Neos and Teva shall enter into a
non-exclusive license and sublicense agreement in the form annexed hereto as
Exhibit B (the “License Agreement”).

 

3.                                      Legal Fees.  Each Party shall pay its
own fees and costs, including attorney fees, incurred in connection with the
Action and in connection with the preparation, execution, and performance of
this Agreement.

 

4.                                      Legal Compliance.  The Parties shall
submit this Agreement, the License Agreement, the Stipulation And Order, and
Exhibit C (the “Settlement Documents”) to the appropriate personnel at the
Federal Trade Commission (“FTC”) and the Antitrust Division of the Department of
Justice (the “DOJ”) as soon as practicable after the Execution Date, and in no
event later than ten (10) days after the Execution Date.

 

(a)     To the extent that any legal or regulatory issue or barrier arises with
respect to the Settlement Documents, or any subpart thereof, the Parties shall
use commercially reasonable efforts to modify the Settlement Documents to
address any such legal or regulatory issue or barrier (including for example any
objection by the FTC or DOJ) while maintaining the material terms of the
transaction.  Should the FTC or DOJ, as the case may be, object to any such
modification, the Parties agree to continue to use commercially reasonable
efforts to modify, as many times as necessary, the Settlement Documents as
required above in this Section 4.

 

(b)     For purposes of the Settlement Documents, “commercially reasonable
efforts” shall mean such reasonable, diligent, and good-faith efforts as a Party
would normally use to accomplish a similar objective under similar
circumstances.

 

5.                                      Released Claims.  In addition to the
dismissal of the Action, as set forth in the Stipulation And Order, and in
consideration of the representations, warranties, and covenants contained in
this Settlement Agreement and the License Agreement, Neos and Teva make the
following releases, which shall be effective upon the entry of the Stipulation
And Order by the Court in the Action:

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

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(a)  Teva for itself and its Affiliates hereby irrevocably releases and
discharges Neos and its Affiliates, predecessors, successors, assigns,
directors, officers, employees, agents, suppliers, distributors, importers,
manufacturers, and customers from all causes of action, demands, claims,
damages, and liabilities of any nature, whether known or unknown, arising
between Teva and/or its Affiliates and Neos and/or its Affiliates from or in
connection with the Action, the Teva ANDA, the generic products described by the
Teva ANDA, and/or Neos’s COTEMPLA XR-ODT™ brand methylphenidate extended-release
orally disintegrating tablet products and accruing or occurring prior to the
Execution Date, including, without limitation, all claims, defenses, and/or
counterclaims that Teva and/or its Affiliates have asserted or could have
asserted in the Action or in any other court or patent office proceeding in
connection with the Teva ANDA or the products described by the Teva ANDA that
any of the Licensed Patents, as defined in the License Agreement, is invalid,
unenforceable, not properly listed in Approved Drug Products With Therapeutic
Equivalence Evaluations (“the Orange Book”), not subject to the proper use codes
in the Orange Book, and/or not infringed by the filing of the Teva ANDA and/or
the sale of the generic products described by the Teva ANDA in the Territory
(all of the above collectively, the “Teva Released Claims”).  For the avoidance
of doubt, the release granted under this Section 5(a) shall not apply to any
product aside from the products described by the Teva ANDA or NDA 205489, or to
any ANDA other than the Teva ANDA.  Teva retains all rights set forth in
Section 10 of the License Agreement.

 

(b)     Neos for itself and its Affiliates hereby irrevocably releases and
discharges Teva and its Affiliates, predecessors, successors, assigns,
directors, officers, employees, agents, suppliers, distributors, importers,
manufacturers, and customers from all causes of action, demands, claims,
damages, and liabilities of any nature, whether known or unknown, arising
between Neos and/or its Affiliates and Teva and/or its Affiliates from or in
connection with the Action, the Teva ANDA, the generic products described by the
Teva ANDA, and/or Neos’s COTEMPLA XR-ODT™ brand methylphenidate extended-release
orally disintegrating tablet products and accruing or occurring prior to the
Execution Date, including, without limitation, all claims that Neos and/or its
Affiliates have asserted or could have asserted in the Action or in any other
proceeding that any of the Licensed Patents, as defined in the License
Agreement, is infringed by the Teva ANDA and/or the sale of the generic products
described by the Teva ANDA in the Territory (all of the above collectively, the
“Neos Released Claims”).  For the avoidance of doubt, the release granted under
this Section 5(b) shall not apply to any product aside from the products
described by the Teva ANDA or NDA 205489, or to any ANDA other than the Teva
ANDA.  Neos retains all rights set forth in Section 10 of the License Agreement.

 

(c)      this Agreement shall constitute a final settlement between the Parties
in the Territory in connection with the Action and the Teva ANDA, and neither
Teva nor its Affiliates shall institute any new challenge or litigation against
Neos and/or its Affiliates with respect to any of the Licensed Patents, as
defined in the License Agreement, and ANDA 210924, or actively assist or
cooperate with any other party in any such challenge or litigation unless so
ordered by the Court or compelled by law.  Notwithstanding this Section 5, Teva
may (1) re-certify and/or maintain a “Paragraph IV Certification” in the Teva
ANDA (as defined in the

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

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License Agreement) with respect to the Licensed Patents or amend the Teva ANDA
to contain a “Paragraph IV Certification” with respect to any patent listed in
the Orange Book for COTEMPLA XR-ODT™ brand methylphenidate extended-release
orally disintegrating tablets (and send corresponding notice of such
certification); (2) challenge the infringement, validity, enforceability or
patentability of any claim of the Licensed Patents in any litigation or
proceeding in any court with respect to any product other than the Licensed
Products (as defined in the License Agreement) or any ANDA other than the Teva
ANDA; or (3) file a petition with the U.S. Patent and Trademark Office
requesting reexamination, inter partes review, or other post grant review of any
claims of any Licensed Patents for which Neos or its Affiliates initiates a
district court litigation against Teva with a claim of infringement with respect
to any product other than the Licensed Products, as defined by the License
Agreement, or any ANDA other than the Teva ANDA.  Further, notwithstanding this
Section 5, the Neos Released Claims do not preclude Neos from asserting
infringement of any of the Licensed Patents, as defined in the License
Agreement, in any action or proceeding against Teva and/or any of its Affiliates
involving any Teva product other than the Licensed Products, as defined in the
License Agreement.

 

(d)  Neither Party shall release any agent or consultant retained by the Party
in connection with the Action or any attorney who represented such Party in the
Action from maintaining the confidentiality of non-public information to which
such agent, consultant or attorney had access in connection with the Action or
grant any waivers with respect to such maintenance, unless so ordered by the
Court or compelled by law; and

 

(e)  to the extent necessary, each Party shall cooperate with the other to
enforce the obligations of such agents, consultants, or attorneys referred to
under Section 5(d) herein.

 

6.                                      ACKNOWLEDGMENTS.  Teva and Neos
acknowledge as follows:

 

(a)         TEVA ACKNOWLEDGES THAT IT MAY HEREAFTER DISCOVER CLAIMS OR FACTS IN
ADDITION TO OR DIFFERENT FROM THOSE WHICH IT NOW KNOWS OR BELIEVES TO EXIST WITH
RESPECT TO THE TEVA RELEASED CLAIMS, THE FACTS AND CIRCUMSTANCES ALLEGED IN THE
ACTION, AND/OR THE SUBJECT MATTER OF THIS AGREEMENT, WHICH, IF KNOWN OR
SUSPECTED AT THE TIME OF EXECUTING THIS AGREEMENT, MAY HAVE MATERIALLY AFFECTED
THIS AGREEMENT.  NEVERTHELESS, UPON THE EFFECTIVENESS OF THE RELEASE OF THE TEVA
RELEASED CLAIMS AS SET FORTH IN SECTION 5 ABOVE, TEVA HEREBY ACKNOWLEDGES THAT
THE TEVA RELEASED CLAIMS INCLUDE WAIVERS OF ANY RIGHTS, CLAIMS, OR CAUSES OF
ACTION THAT MIGHT ARISE AS A RESULT OF SUCH DIFFERENT OR ADDITIONAL CLAIMS OR
FACTS.  TEVA ACKNOWLEDGES THAT IT UNDERSTANDS THE SIGNIFICANCE AND POTENTIAL
CONSEQUENCES OF SUCH A RELEASE OF UNKNOWN UNITED STATES JURISDICTION CLAIMS AND
OF SUCH A SPECIFIC WAIVER OF RIGHTS.  TEVA INTENDS THAT THE CLAIMS RELEASED BY
IT UNDER THIS RELEASE BE

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

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CONSTRUED AS BROADLY AS POSSIBLE TO THE EXTENT THEY RELATE TO UNITED STATES
JURISDICTION CLAIMS.  TEVA IS AWARE OF CALIFORNIA CIVIL CODE SECTION 1542, WHICH
PROVIDES AS FOLLOWS:

 

“A general release does not extend to claims which the creditor does not know or
suspect to exist in his or her favor at the time of executing the release, which
if known by him or her, must have materially affected his or her settlement with
the debtor.”

 

TEVA AGREES TO EXPRESSLY WAIVE ANY RIGHTS IT MAY HAVE UNDER THIS CODE SECTION OR
UNDER FEDERAL, STATE, OR COMMON LAW STATUTES OR JUDICIAL DECISIONS OF A SIMILAR
NATURE, AND KNOWINGLY AND VOLUNTARILY WAIVES ALL SUCH UNKNOWN CLAIMS.

 

(b)         NEOS ACKNOWLEDGES THAT IT MAY HEREAFTER DISCOVER CLAIMS OR FACTS IN
ADDITION TO OR DIFFERENT FROM THOSE WHICH IT NOW KNOWS OR BELIEVES TO EXIST WITH
RESPECT TO THE NEOS RELEASED CLAIMS, THE FACTS AND CIRCUMSTANCES ALLEGED IN THE
ACTION, AND/OR THE SUBJECT MATTER OF THIS AGREEMENT, WHICH, IF KNOWN OR
SUSPECTED AT THE TIME OF EXECUTING THIS AGREEMENT, MAY HAVE MATERIALLY AFFECTED
THIS AGREEMENT.  NEVERTHELESS, UPON THE EFFECTIVENESS OF THE RELEASE OF THE NEOS
RELEASED CLAIMS AS SET FORTH IN SECTION 5 ABOVE, NEOS HEREBY ACKNOWLEDGES THAT
THE NEOS RELEASED CLAIMS INCLUDE WAIVERS OF ANY RIGHTS, CLAIMS, OR CAUSES OF
ACTION THAT MIGHT ARISE AS A RESULT OF SUCH DIFFERENT OR ADDITIONAL CLAIMS OR
FACTS.  NEOS ACKNOWLEDGES THAT IT UNDERSTANDS THE SIGNIFICANCE AND POTENTIAL
CONSEQUENCES OF SUCH A RELEASE OF UNKNOWN UNITED STATES JURISDICTION CLAIMS AND
OF SUCH A SPECIFIC WAIVER OF RIGHTS.  NEOS INTENDS THAT THE CLAIMS RELEASED BY
IT UNDER THIS RELEASE BE CONSTRUED AS BROADLY AS POSSIBLE TO THE EXTENT THEY
RELATE TO UNITED STATES JURISDICTION CLAIMS.  NEOS IS AWARE OF CALIFORNIA CIVIL
CODE SECTION 1542, WHICH PROVIDES AS FOLLOWS:

 

“A general release does not extend to claims which the creditor does not know or
suspect to exist in his or her favor at the time of executing the release, which
if known by him or her, must have materially affected his or her settlement with
the debtor.”

 

NEOS AGREES TO EXPRESSLY WAIVE ANY RIGHTS IT MAY HAVE UNDER THIS CODE SECTION OR
UNDER FEDERAL, STATE, OR COMMON LAW STATUTES OR JUDICIAL DECISIONS OF A SIMILAR
NATURE, AND KNOWINGLY AND VOLUNTARILY WAIVES ALL SUCH UNKNOWN CLAIMS.

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

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7.                                      Confidentiality.  The terms of this
Settlement Agreement shall be maintained in strict confidence by the Parties
except:  (a) as provided by Section 4 of this Agreement; (b) that Neos may
disclose such terms as may be necessary or useful in connection with any
litigation or other proceeding relating to any of the Licensed Patents (as
defined in the License Agreement), so long as Neos notifies Teva 14 days prior
to such disclosure and such disclosure is made pursuant to either:  (1) the
highest level of confidentiality under a protective order; or (2) a
confidentiality agreement that restricts access to outside counsel only;
(c) that any Party may disclose such terms if and as required by law, including,
without limitation, SEC reporting requirements, disclosure requirements to a
Party’s bondholders, noteholders, or debtholders, or the disclosure requirements
of any stock exchange that a Party is subject to; (d) that Teva may disclose
such terms to the FDA or to its manufacturers, suppliers and distributors as may
be necessary or useful in obtaining and maintaining final approval of the Teva
ANDA and launching the generic products that are the subject of the Teva ANDA
when and as permitted by the License Agreement, so long as Teva requests that
the FDA and such manufacturers, suppliers and distributors, as applicable,
maintain such terms in confidence; (e) that any party may disclose the terms of
this Agreement to its Affiliates and/or any Third Party in connection with a
potential or actual merger, reorganization, investment, change of control, or
sale of all or substantially all of the applicable business or assets of the
party to which this Agreement relates, and/or to any Third Party in connection
with any divestiture of the Teva ANDA, Neos NDA, or any of the Licensed Patents,
so long as such disclosure is made pursuant to a confidentiality agreement that
is at least as restrictive with respect to access as the terms of this
Agreement; (f) that any Party may disclose such terms to its accountants,
auditors, and/or attorneys as required for them to perform their duties, so long
as such disclosure is made subject to a confidentiality agreement or
professional confidentiality obligation; and (g) that the Parties may each issue
a press release disclosing that the Parties have settled the Action, and that
Teva has received a license under the Licensed Patents, as defined in the
License Agreement, that will permit Teva to commercially launch the Licensed
Products on the Launch Date, as those terms are defined in the License
Agreement, or earlier in certain circumstances, so long as such press release is
approved by the other Parties, which approval shall not be unreasonably delayed,
conditioned, or withheld.  The Parties acknowledge and agree that, upon its
filing with the Court, the Stipulation And Order will be a matter of public
record and shall not be subject to any confidentiality restrictions.  The
Parties further agree that, upon the filing of the Stipulation And Order with
the Court, the fact that the Parties have settled the Action will be a matter of
public record and shall not be subject to any confidentiality restrictions, but
that the terms of such settlement shall be maintained in confidence as provided
by this Section 7.

 

8.                                      Term and Termination.  This Agreement
shall continue from the Execution Date until the earlier of:  (a) the expiration
of the last to expire of the Licensed Patents, as defined by the License
Agreement; or (b) the date of a Final Court Decision, as defined by the License
Agreement, that all of the claims of all of the Licensed Patents, as defined by
the License Agreement, are invalid, not infringed, or unenforceable.  The
releases and discharges set forth in Section 5 of this Agreement shall survive
the expiration or termination of this Agreement and the confidentiality
obligations set forth in Section 7 of this Agreement shall survive for a

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

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period of fifteen (15) years from the Execution Date, notwithstanding any
earlier expiration or termination of this Settlement Agreement.  The License
Agreement shall remain in full force and effect pursuant to its own terms
notwithstanding the expiration or termination of this Agreement.

 

9.                                      No Assignment.  This Agreement may not
be assigned or transferred to a Third Party, as defined in the License
Agreement, without the express prior written consent of the other Parties
hereto, which shall not be unreasonably withheld, conditioned, or delayed,
except to a successor to all or substantially all of the business of the
assigning or transferring Party to which this Agreement pertains (whether by
sale of stock or assets, merger, consolidation, reorganization, divestiture,
change in control, or otherwise) in which case the Party shall assign this
Agreement to such successor.  The covenants, rights, and obligations of a Party
under this Agreement shall inure to the benefit of and be binding upon any
successor or permitted assignee of the Party.  Any purported assignment in
violation of this Section 9 of the Agreement shall be null and void ab initio
and of no force or effect.

 

10.                               Notice.  Any notice required or permitted to
be given or sent under this Agreement shall be hand delivered or sent by express
delivery service to the Parties at the addresses indicated below.

 

If to Neos, to:

Mr. Richard Eisenstadt

 

Chief Financial Officer

 

Neos Therapeutics, Inc.

 

2940 North Highway 360

 

Suite 400

 

Grand Prairie, Texas 75050

 

 

with a copy to:

Peter J. Armenio, P.C.

 

Quinn Emanuel Urquhart & Sullivan, LLP

 

51 Madison Avenue

 

New York, New York 10010

 

 

If to Teva, to:

Colman B. Ragan, Esq.

 

Vice President & General Counsel

 

North America Intellectual Property Litigation

 

Teva Pharmaceuticals USA, Inc.

 

400 Interpace Parkway

 

Parsippany, NJ 07054

 

 

with a copy to:

Michael Nutter, Esq.

 

Winston & Strawn LLP

 

35 W. Wacker Drive

 

Chicago, IL 60601

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

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Any such notice shall be deemed to have been received on the date actually
received.  Either Party may change its notice information above by giving the
other Parties written notice, delivered in accordance with this Section.

 

11.                               Entire Agreement.  This Agreement, as defined
herein to include Exhibits A, B, and C, constitutes the complete and final
agreement between the Parties with respect to the subject matter hereof and
supersedes and terminates any prior or contemporaneous agreements and/or
understandings between the Parties, whether oral or in writing, relating to such
subject matter.  There are no covenants, promises, agreements, warranties,
representations, conditions, or understandings, either oral or written, between
the Parties relating to such subject matter other than as are set forth in this
Agreement.  No alteration, amendment, change, waiver, or addition to this
Agreement shall be binding upon any of the Parties unless reduced to writing and
signed by an authorized officer of each Party.  Each Party in deciding to
execute this Agreement has retained counsel and has not relied on any
understanding, agreement, representation, or promise by any Party that is not
explicitly set forth herein.

 

12.                               Governing Law.  This Agreement shall be
governed, interpreted, and construed in accordance with the laws of the State of
Delaware, without giving effect to choice of law principles.  The Parties
irrevocably agree that the federal district court in the State of Delaware shall
have exclusive jurisdiction to deal with any disputes arising out of or in
connection with this Agreement and that, accordingly, any proceeding arising out
of or in connection with this Agreement shall be brought in the United States
District Court for the District of Delaware.  Notwithstanding the foregoing, if
there is any dispute for which the federal district court in the State of
Delaware does not have subject matter jurisdiction, the state courts in Delaware
shall have jurisdiction.  In connection with any dispute arising out of or in
connection with this Agreement, each Party hereby expressly consents and submits
to the personal jurisdiction of the federal and state courts in the State of
Delaware.

 

13.                               Severability.  Subject to the provisions and
the mechanisms of Section 4 above, if any provision of this Agreement is
declared illegal, invalid, or unenforceable by a court having competent
jurisdiction, it is mutually agreed that this Agreement shall endure except for
the part declared invalid or unenforceable by order of such court; provided,
however, that in the event that the terms and conditions of this Agreement are
materially altered, the Parties will, in good faith, renegotiate the terms and
conditions of this Agreement to reasonably replace such invalid or unenforceable
provisions in light of the intent of this Agreement.

 

14.                               Waiver.  Any delay or failure in enforcing a
Party’s rights under this Agreement, or any acquiescence as to a particular
default or other matter, shall not constitute a waiver of such Party’s rights to
the enforcement of such rights, nor operate to bar the exercise or enforcement
thereof at any time or times thereafter, except as to an express written and
signed waiver as to a particular matter for a particular period of time.

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

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15.                               Counterparts.  This Agreement shall become
binding when any one or more counterparts hereof, individually or taken
together, bears the signatures of all of the Parties.  This Agreement may be
executed in any number of counterparts (including facsimile or e-mail
counterparts), each of which shall be an original as against a Party whose
signature appears thereon, but all of which taken together shall constitute one
and the same instrument.

 

16.                               Representations and Warranties.  Each Party
hereby represents and warrants that:  (a) it has approved the execution of this
Agreement and has authorized and directed the signatory officer below to execute
and deliver this Agreement; (b) it has the full right and power to enter into
this Agreement, and there are no other persons or entities whose consent or
joinder in this Agreement is necessary to make fully effective those provisions
of this Agreement that obligate, burden, or bind it; (c) when executed by it,
this Agreement shall constitute a valid and binding obligation of the Party,
enforceable in accordance with its terms; and (d) it has not transferred,
assigned, or pledged to any third party, whether or not Affiliated, the right to
bring, pursue, or settle any of the claims, defenses, or counterclaims in the
Action.

 

17.                               Construction.  This Agreement has been jointly
negotiated and drafted by the Parties through their respective counsel and no
provision shall be construed or interpreted for or against any of the Parties on
the basis that such provision, or any other provision, or the Agreement as a
whole, was purportedly drafted by a particular Party.  Unless specified
otherwise, all references to periods of days for taking certain actions in this
Agreement shall be construed to refer to business days.  All references to an
Affiliate or Affiliates in this Agreement shall have the meaning provided by
Section 1.4 of the License Agreement.

 

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CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

9

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IN WITNESS WHEREOF, and intending to be legally bound, this Agreement has been
executed by the duly authorized representatives of the Parties.

 

NEOS THERAPEUTICS, INC.

 

NEOS THERAPEUTICS, LP

 

 

 

By:

/s/ Richard Eisenstadt

 

By:

/s/ Richard Eisenstadt

Name:

Richard Eisenstadt

 

Name:

Richard Eisenstadt

Title:

Chief Financial Officer

 

Title:

Chief Financial Officer

 

 

 

 

 

 

TEVA PHARMACEUTICALS USA, INC.

 

TEVA PHARMACEUTICALS USA, INC.

 

 

 

By:

/s/ Hafrun Fridriksdottir

 

By:

/s/ Colman Ragan

Name:

Hafrun Fridriksdottir

 

Name:

Colman Ragan

Title:

EVP Global R&D

 

Title:

VP & GC North America

 

 

 

 

IP Litigation

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

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EXHIBIT A

 

Stipulation And Order

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

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IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF DELAWARE

 

NEOS THERAPEUTICS, INC.

)

and NEOS THERAPEUTICS, LP,

)

Civil Action No. 17-1793-CFC

 

Plaintiffs,

)

 

)

 

v.

)

 

)

TEVA PHARMACEUTICALS USA, INC.,

)

 

)

 

Defendant.

)

 

STIPULATION AND ORDER

 

The Court, upon the consent and request of Plaintiffs Neos Therapeutics, Inc.
and Neos Therapeutics, LP (collectively, “Plaintiffs”) and Defendant Teva
Pharmaceuticals USA, Inc. (“Teva”), hereby acknowledges the following
Stipulation and issues the following Order.

 

STIPULATION

 

1.              This Court has subject matter jurisdiction over the
above-captioned patent infringement action (the “Action”) and personal
jurisdiction over Plaintiffs and Teva for purposes of this Action only.  Venue
is proper in this Court as to Plaintiffs and Teva for purposes of this Action
only.

 

2.              In the Action, Plaintiffs have asserted claims against Teva for
infringement of U.S. Patent Nos. 8,840,924 (“the ‘924 patent”), 9,072,680 (“the
‘680 patent”); and 9,089,496 (“the ‘496 patent”), in connection with Teva’s
submission of Abbreviated New Drug Application (“ANDA”) No. 210924 directed to
generic extended-release orally

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

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disintegrating tablets containing 8.6 mg, 17.3 mg, or 25.9 mg of methylphenidate
to the U.S. Food and Drug Administration (“FDA”).

 

3.              In response to Plaintiffs’ charges of patent infringement, Teva
has denied Plaintiffs’ claims and alleged certain defenses and counterclaims,
including that the ‘924 patent, ‘680 patent, and the ‘496 patent are invalid
and/or not infringed by the generic extended-release orally disintegrating
tablet products that are the subject of ANDA No. 210924.  To date, no decision
has been obtained in the Action regarding Plaintiffs’ claims of infringement,
the validity of the ‘924 patent, ‘680 patent, and the ‘496 patent, and/or
whether any commercial making, using, selling, or offering to sell within the
United States, or importing into the United States, of the generic products
described by ANDA No. 210924 would infringe those patents.

 

4.              For purposes of resolving the Action, Teva admits that the
submission of ANDA No. 210924 to the FDA for the purpose of obtaining regulatory
approval to engage in the commercial manufacture, use, and/or sale of the
generic methylphenidate products described therein within the United States
before the expiration the ‘924 patent, ‘680 patent, and the ‘496 patent was a
technical act of infringement of each of those patents under 35 U.S.C.
§ 271(e)(2)(A).  This admission is without prejudice to any claim, defense, or
counterclaim in any possible future action or proceeding between Teva and
Plaintiffs regarding the ‘924 patent, the ‘680 patent, and/or the ‘496 patent
and a product other than the generic products described by ANDA No. 210924.

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

2

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5.              Both parties agree that all other claims, defenses, and
counterclaims set forth in the pleadings in the Action, including the
allegations and averments contained therein, should be dismissed, without
prejudice.

 

ORDER

 

Accordingly, pursuant to the above Stipulation, and upon the consent and request
of Plaintiffs and Teva, IT IS HEREBY ORDERED, ADJUDGED AND DECREED THAT:

 

1.              The filing of ANDA No. 210924 was a technical act of
infringement of the ‘924 patent, ‘680 patent, and the ‘496 patent under 35
U.S.C. § 271(e)(2)(A).  No decision in the Action has been obtained by either
party regarding the validity of the ‘924 patent, ‘680 patent, and the ‘496
patent and/or whether any commercial making, using, selling, or offering to sell
within the United States, or importing into the United States, of the generic
products described by ANDA No. 210924 would infringe those patents.

 

2.              All other claims, defenses, and counterclaims set forth in the
pleadings in the Action, including the allegations and averments contained
therein, are hereby dismissed, without prejudice.

 

3.              Teva, its officers, agents, servants, employees, and attorneys,
and all other persons in active concert or participation with any of them who
receive actual notice of this Order by personal service or otherwise, are hereby
enjoined from commercially manufacturing, using, offering to sell, or selling
within the United States, or importing into the United States, the generic
extended-release orally disintegrating tablet products described by ANDA
No. 210924

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

3

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during the life of the ‘924 patent, ‘680 patent, and the ‘496 patent, including
any extensions and pediatric exclusivities, absent a license agreement or other
authorization by Plaintiffs.

 

4.              Plaintiffs and Teva each expressly waive any right to appeal or
otherwise move for relief from this Stipulation And Order.

 

5.              Each party is to bear its own attorneys’ fees and costs.

 

6.              This Court retains jurisdiction over Plaintiffs and Teva for
purposes of enforcing this Stipulation And Order.

 

7.              This Stipulation And Order shall finally resolve the Action.

 

8.              This Stipulation And Order is without prejudice to any claim,
defense, or counterclaim in any possible future action or proceeding between
Teva and Plaintiffs regarding the ‘924 patent, ‘680 patent, and the ‘496 patent
and a product other than the generic extended-release orally disintegrating
tablet products described by ANDA No. 210924.

 

9.              Nothing herein prohibits or is intended to prohibit:  (a) Teva
from maintaining any “Paragraph IV Certification” pursuant to 21 U.S.C. §
355(j)(2)(A)(vii)(IV) or pursuant to 21 C.F.R. § 314.94(a)(12) with respect to
ANDA No. 210924; or (b) the U.S. Food and Drug Administration from granting
final approval of Teva’s ANDA No. 210924 at any time.

 

10.       The Clerk of the Court is directed to enter this Stipulation And Order
forthwith.

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

4

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SO ORDERED:

 

This        day of                  ,      

 

 

 

 

HONORABLE COLM F. CONNOLLY

 

UNITED STATES DISTRICT JUDGE

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

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EXHIBIT B

 

License Agreement

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

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LICENSE AGREEMENT

 

This License Agreement (including Exhibit C, the “License Agreement”) is made
and entered into this 21st day of December, 2018 (the “Execution Date”), by and
between, on the one hand, Neos Therapeutics, Inc. and Neos Therapeutics, LP
(collectively, “Neos”), and on the other hand, Teva Pharmaceuticals USA, Inc.
(“Teva”) (collectively, the “Parties,” or each separately, a “Party”).

 

RECITALS

 

A.            WHEREAS Neos owns certain U.S. patents listed in the FDA
publication Approved Drug Products With Therapeutic Equivalence Evaluations in
connection with the COTEMPLA XR-ODT™ brand methylphenidate extended-release
orally disintegrating tablets sold in the Territory, as hereinafter defined,
under the Neos NDA, as hereinafter defined; and

 

B.            WHEREAS Teva has sought approval from the U.S. Food and Drug
Administration (“FDA”) to market generic extended-release orally disintegrating
tablets containing 8.6 mg, 17.3 mg, or 25.9 mg of methylphenidate in the
Territory under the Teva ANDA, as hereinafter defined; and

 

C.            WHEREAS Teva has represented that it is a First Filer, as
hereinafter defined; and

 

D.            WHEREAS, pursuant to the settlement agreement to which this
License Agreement is Exhibit B (the “Agreement”), executed contemporaneously
with this License Agreement, Neos and Teva have agreed to settle the patent
infringement litigation described therein related to Teva’s filing of the Teva
ANDA with the FDA; and

 

E.            WHEREAS, as part of such settlement, Neos and Teva agreed to enter
into this License Agreement, which, as of the date and upon the terms set forth
herein, grants Teva a non-exclusive license and sublicense, as applicable, under
the Licensed Patents, as hereinafter defined, to manufacture and/or sell in the
Territory the Licensed Products, as hereinafter defined.

 

NOW THEREFORE, in consideration of the promises and mutual covenants set forth
herein, the sufficiency of which is hereby acknowledged, the Parties hereby
agree as follows.

 

1.             Definitions

 

1.1          “‘924 Patent” shall mean U.S. Patent No. 8,840,924, including all
corrections, extensions, and pediatric exclusivities, and any continuations,
continuations-in-part, divisionals, reissues, or reexaminations thereof, in each
case whether granted or allowed before, on, or after the Execution Date.

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

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1.2          “‘680 Patent” shall mean U.S. Patent No. 9,072,680, including all
corrections, extensions, and pediatric exclusivities, and any continuations,
continuations-in-part, divisionals, reissues, or reexaminations thereof, in each
case whether granted or allowed before, on, or after the Execution Date.

 

1.3          “‘496 Patent” shall mean U.S. Patent No. 9,089,496, including all
corrections, extensions, and pediatric exclusivities, and any continuations,
continuations-in-part, divisionals, reissues, or reexaminations thereof, in each
case whether granted or allowed before, on, or after the Execution Date.

 

1.4          “Affiliate” shall mean any person or legal entity directly or
indirectly, through one or more intermediary, controlling, controlled by, or
under common control with the Party, where control shall mean:  (a) in the case
of a corporate entity, the direct or indirect ownership of more than fifty
percent (50%) of the outstanding voting securities of an entity or such other
relationship as results in the actual control over the management, assets,
business, and affairs of an entity; and (b) in the case of a non-corporate
entity, the direct or indirect power to either:  (i) direct the management and
policies of the non-corporate entity; or (ii) elect more than fifty percent
(50%) of the members of the governing body of such non-corporate entity.  The
term “Affiliate” does not include API Affiliate or Wholesaler Affiliate, as
defined below.

 

1.5          “ANDA” shall mean an Abbreviated New Drug Application.

 

1.6          “API Affiliate” shall mean a subsidiary or Affiliate of a Party
whose primary business is the manufacture and sale of active pharmaceutical
ingredients (“API”).  An API Affiliate shall not be deemed to be an Affiliate of
a Party for purposes of this Agreement.  For clarity, Teva’s API Affiliates as
of the Execution Date include, without limitation, Teva API Inc.

 

1.7          “Authorized Generic” shall mean a generic product:  (a) having the
Compound as the sole active ingredient; (b) that is Marketed in the Territory
without the Trademark; and (c) that is Marketed under the Neos NDA.

 

1.8          “Compound” shall mean methylphenidate.

 

1.9          “Effective Date” shall mean the date that the Stipulation And Order
is entered by the Court.

 

1.10        “FDA” shall mean the U.S. Food and Drug Administration or any
successor agency.

 

1.11        “Final Court Decision” shall mean a decision of a court or the U.S.
Patent Trial and Appeal Board from which no appeal has been or can be taken,
excluding any petition for a writ of certiorari or other proceedings before the
United States Supreme Court.

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

2

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1.12        “First Filer” shall mean any party that filed a substantially
complete ANDA seeking FDA approval to Market a Generic Equivalent in the
Territory before the expiration of one or more of the Licensed Patents with the
FDA on the same day that the first such ANDA was filed with the FDA.

 

1.13        “Generic Equivalent” shall mean:  (a) a pharmaceutical product that
has been approved by or submitted for approval to FDA for Marketing in the
Territory pursuant to an ANDA or a paper NDA (an application under 21 U.S.C. §
355(b)(2)) as a generic equivalent to any of the NDA Products; or (b) an
Authorized Generic.

 

1.14        “GMPs” shall mean then current good manufacturing practice
regulations promulgated by the FDA.

 

1.15        “Launch Date” shall mean July 1, 2026, unless accelerated as
explicitly provided herein.

 

1.16        “Licensed Patents” shall mean, collectively, the ‘924 Patent, the
‘680 Patent, and the ‘496 Patent, and any other patents either owned,
in-licensed, or acquired, now or in the future, by Neos or any of its Affiliates
that would, in the absence of the Teva License granted under this License
Agreement, be infringed by the Manufacture, having Manufactured, and/or
Marketing by Teva of the Licensed Products in or for the Territory as of the
Launch Date, including any corrections, extensions, pediatric exclusivities,
continuations, continuations-in-part, divisionals, reissues, or reexaminations
thereof.

 

1.17        “Licensed Products” shall mean the extended-release orally
disintegrating tablets that are the subject of the Teva ANDA, as that term is
defined in Section 1.27.

 

1.18        “Manufacture” shall mean to make, or to have made, a pharmaceutical
product in accordance with GMPs and the provisions of an ANDA or NDA covering
such product, and “Manufacturing” shall have a corresponding meaning.

 

1.19        “Market” shall mean to offer, sell, or offer to sell a
pharmaceutical product in accordance with all applicable laws and/or to use,
import, or export such product for such purposes under all applicable laws, and
“Marketing” shall have a corresponding meaning.

 

1.20        “NDA Products” shall mean the extended-release orally disintegrating
tablets containing 8.6 mg, 17.3 mg, or 25.9 mg of methylphenidate Marketed under
the Trademark in the Territory that contain the Compound as the sole active
ingredient and that are approved for Marketing in the Territory pursuant to the
Neos NDA, as defined below.

 

1.21        “Neos NDA” shall mean New Drug Application No. 205489.

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

3

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1.22        “Officially Discontinue” shall mean any of:  (a) delisting the
products described in Neos NDA with the FDA; (b) delisting the Licensed Patents
from the Orange Book unless Neos reasonably determines in good faith that such
delisting is required under applicable law; (c) seeking action with the FDA to
withdraw COTEMPLA XR-ODT™ from the market, unless required, requested or
recommended by the FDA or another governmental authority to do so; or
(d) deleting, removing, or canceling any National Drug Code(s) for COTEMPLA
XR-ODT™from the applicable National Drug File.

 

1.23        “Permitted Modification” shall mean any supplement of, modification
to, or replacement of, ANDA No. 210924 that does not change the active
ingredient, dosage form, reference listed drug (unless the reference listed drug
is first changed for NDA No. 205489), or AB rating of any generic product
defined by said ANDA.  For the avoidance of doubt, a modification or replacement
of ANDA No. 210924 to change the active ingredient or add a second active
ingredient is not a Permitted Modification.  For the avoidance of doubt, a
modification or replacement of ANDA No. 210924 to change the dosage form to an
oral liquid dosage form is not a Permitted Modification.

 

1.24        “Stipulation And Order” shall mean the document attached to the
Settlement Agreement as Exhibit A.

 

1.25        “Term” shall mean the period of time from the Execution Date of this
License Agreement until the date on which this License Agreement expires or
terminates as provided in Section 12 of this License Agreement.

 

1.26        “Territory” shall mean the United States of America, including its
territories, possessions, and the Commonwealth of Puerto Rico.

 

1.27        “Teva ANDA” shall mean Teva’s ANDA No. 210924 as supplemented and
amended as of the Execution Date of this License Agreement and including any
Permitted Modification after the Execution Date of this License Agreement.

 

1.28        “Teva License” shall have the meaning assigned to such term in
Section 2.1 of this License Agreement.

 

1.29        “Third Party” shall mean any person or entity other than the Parties
and their Affiliates.

 

1.30        “Trademark” shall mean the trademark COTEMPLA XR-ODT™.

 

1.31        “Wholesaler Affiliate” shall mean a subsidiary or Affiliate of a
Party whose primary business is wholesale distribution of pharmaceutical
products.  A Wholesaler Affiliate shall not be deemed to be an Affiliate of a
Party.  For clarity, Teva’s Wholesaler Affiliates as of the Execution Date
include, without limitation, Anda, Inc.

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

4

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2.             Teva License/Waiver of Exclusivities

 

2.1          Licensed Products.  Effective on and after the Launch Date, Neos
grants to Teva and its Affiliates (and to the extent necessary, its suppliers,
distributors, and customers, as the case may be):

 

(a)           a non-exclusive, fully paid up, royalty-free license and
sublicense, as applicable, under the Licensed Patents to Manufacture, have
Manufactured, and Market the Licensed Products in or for the Territory; and

 

(b)           a waiver of any regulatory, statutory, or other exclusivities
necessary to effectuate the license and sublicense provided in
Section 2.1(a) with respect to the Licensed Products.

 

In addition, during the period of one hundred eighty (180) consecutive calendar
days prior to the Launch Date, Neos grants to Teva a non-exclusive license and
sublicense, as applicable, to Manufacture or have Manufactured Licensed Products
in or for the Territory solely to the extent reasonably necessary to enable Teva
to launch such Licensed Products in the Territory on or after the Launch Date. 
Teva may Manufacture Licensed Products earlier to the extent necessary and
related to FDA approval.  The licenses and sublicenses granted under this
Section 2.1 are referred to herein as the “Teva License.”  Teva shall not have
any right to sublicense, transfer, or assign any of its rights under the Teva
License, except to the extent expressly permitted under Section 13.2 of this
License Agreement.

 

2.2          Pre-Booking Activities.  Notwithstanding anything to the contrary
contained in this License Agreement, prior to the Launch Date, Teva may engage
in the following pre-booking activities:

 

(a)           Discussions with potential customers to make them aware of the
upcoming availability of the Licensed Products from Teva as of the Launch Date,
starting not earlier than [***] consecutive calendar days prior to the Launch
Date;

 

(b)           Importation of the Licensed Products into the Territory starting
not earlier than [***] consecutive calendar days prior to the Launch Date.

 

(c)           Offering the Licensed Products for sale and entering into
non-binding contracts starting not earlier than [***] consecutive calendar days
prior to the Launch Date.

 

For avoidance of doubt, the performance by Teva of any of the activities
expressly provided for in this Section 2.2 during the times expressly provided
for in this Section 2.2 shall not be construed as Marketing of the Licensed
Products prior to the Launch Date for purposes of Section 12.2(a) of this
License Agreement.

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

5

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2.3          Regulatory Delay.  No provision of this License Agreement shall be
affected by any delay in the approval of the Teva ANDA by the FDA, or the
failure of Teva to obtain FDA approval of the Teva ANDA, except to the extent
that such provision is affected by the delay of the Launch Date.

 

2.4          No Interference; No Discontinuation.  Subject to Teva’s compliance
with the terms of this License Agreement and the Settlement Agreement — and
except for good faith reasons of safety and/or efficacy based on legitimate,
objective evidence or pursuant to an FDA request or court order — Neos and/or
its Affiliates shall not, directly or indirectly, seek to interfere with Teva’s
efforts to:  (a) obtain FDA approval of the Licensed Products; or (b) Market the
Licensed Products as of the date and under the terms provided by this License
Agreement.  Subject to Teva’s compliance, neither shall Neos nor any of its
Affiliates Officially Discontinue the products described in the Neos NDA prior
to the expiration of the Licensed Patents, unless required, requested, or
recommended to do so by the FDA or other governmental authority or applicable
law.

 

2.5          Confirmation of Regulatory Waiver.  During the Term, within ten
(10) business days of receiving a written request from Teva delivered in
accordance with Section 13 of this License Agreement, Neos shall submit to the
FDA, and/or shall cause its Affiliates to submit to the FDA, appropriate and
reasonable documentation (in a form acceptable to FDA and all subject to review
by Teva prior to submission) evidencing the licenses, covenants not to sue and
waivers set forth in this agreement, including but not limited to a letter in
the form provided in Exhibit C to the Settlement Agreement.  If requested in
writing by Teva or the FDA, Neos shall further authenticate any true and correct
copy of the Settlement Documents provided to the FDA by Teva.  Should the FDA
request additional confirmation or documentation of the licenses, covenants not
to sue and waivers set forth in this agreement, the Parties agree to use
commercially reasonable efforts to reach agreement with respect to providing any
such requested additional confirmation or documentation.

 

2.6          No Consent For FDA Approval.  Nothing in this License Agreement or
any of the other Settlement Documents shall be interpreted as Neos or its
Affiliates consenting to the accuracy or sufficiency of any scientific, medical,
bioequivalence, regulatory, or other information contained in the Teva ANDA
and/or consenting to the FDA approving the Teva ANDA on the basis of any such
information.

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

6

--------------------------------------------------------------------------------

 

3.             No Unauthorized Manufacturing or Marketing.  Except to the extent
expressly permitted by Section 2.1, Section 2.2, Section 5, or Section 6 of this
License Agreement, unless this License Agreement is earlier terminated in
accordance with the terms thereof, neither Teva, nor any of its Affiliates, nor
any of its API Affiliates, nor any of its Wholesaler Affiliates shall under any
circumstances commercially Manufacture or Market any Licensed Product in the
Territory prior to the expiration of all of the Licensed Patents, including any
extensions and pediatric exclusivities.

 

4.             Neos’s Retained Rights

 

4.1          Retained Rights.  Except for the non-exclusive licenses and
sublicenses granted to Teva under Section 2.1 of this License Agreement, and the
additional rights granted under Section 2.2 of this License Agreement, nothing
herein shall be construed as granting or conveying to Teva any licenses,
sublicenses, or other rights under the Licensed Patents or any other of Neos’s
intellectual property, all such rights being retained by Neos.

 

4.2          Third Party Licenses.  Teva hereby acknowledges that Neos’s
retained rights include, without limitation, the right to grant licenses and/or
sublicenses, as applicable, to any Third Party under any of the Licensed Patents
to, among other things, Manufacture and/or Market in the Territory any Generic
Equivalent.

 

4.3          Authorized Generics.  Teva hereby acknowledges that Neos’s retained
rights include, without limitation, the right to grant licenses and/or
sublicenses, as applicable, to any Third Party under any of the Licensed Patents
to, among other things, Manufacture and/or Market in the Territory an Authorized
Generic.  Teva further acknowledges that Neos’s retained rights include, without
limitation, the right to Manufacture and/or Market in the Territory an
Authorized Generic.

 

5.             Potential Acceleration Of The Launch Date

 

5.1          Effect Of Certain Agreements Or An Authorized Generic

 

(a)           [***]

 

(b)           [***]

 

5.2          Effect Of A Final Court Decision.  If there is a Final Court
Decision regarding a Generic Equivalent holding all then asserted, adjudicated,
and unexpired claims of the Licensed Patents invalid, canceled, unenforceable,
and/or not infringed by a Generic Equivalent, then the Launch Date shall
automatically be amended to the date of such Final Court Decision provided such
Final Court Decision precedes the existing Launch Date.

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

7

--------------------------------------------------------------------------------

 

5.3          Effect Of A Market Erosion.  In the event that there is a Market
Erosion, as defined in Section 5.3(a) of this License Agreement, and there is no
extenuating Force Majeure Event, as defined in Section 5.3(b) of this License
Agreement, then the Launch Date in this License Agreement shall automatically be
amended as defined in Section 5.3(c) of this License Agreement.

 

(a)           [***]

 

(b)           If any Market Erosion defined by Section 5.3(a) of this License
Agreement occurs as the result of a Force Majeure Event, and Neos timely
provides notice and documentation of such Force Majeure Event to Teva, then it
will be deemed as if no such Market Erosion has occurred.  For purposes of this
Section 5.3(b), a “Force Majeure Event” shall be defined as any of the
following:  fire, explosion, earthquake, flood, other natural disasters, or
other acts of God; new acts, regulations, or Laws of any Governmental Entity;
war (whether or not declared), acts of terrorism, or failure of public
utilities; or insolvency of any Third-Party manufacturer of the Compound or any
of the NDA Products.  In the event of a Force Majeure Event, Neos shall timely
notify Teva and take reasonable steps to mitigate or otherwise remedy the impact
of such event.

 

(c)           [***]

 

5.4          Effect Of Multiple Accelerations.  In the event that more than one
of the automatic amendments of the Launch Date provided for by Sections 5.1, 5.2
and/or 5.3 occurs during the Term, the Launch Date shall be the earliest such
amended date.

 

6.             Effect Of A Launch At Risk

 

6.1          [***]

 

(a)           [***]

 

(b)           [***]

 

[***]

 

6.2          [***]

 

6.3          In response to any At Risk Launch, including during any Teva At
Risk Period, Neos shall be entitled to authorize any Third Party to Market an
Authorized Generic in the Territory, and/or Market an Authorized Generic in the
Territory itself or through an Affiliate, all without any notice or compensation
to Teva.  Section 5.1(b) of this License Agreement shall not be triggered by any
such action unless the Authorized Generic in question is still being

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

8

--------------------------------------------------------------------------------

 

shipped within or into the Territory by Neos or its authorized Third Party more
than ten (10) days after the expiration of the Teva At Risk Period.

 

6.4          [***]

 

7.             Quality Assurance.  Teva represents and warrants to Neos that all
Licensed Products Marketed by Teva will be commercially Manufactured, stored,
shipped, handled, and Marketed by it and its designees in accordance with
then-current GMPs and all applicable laws, rules, and regulations.

 

8.             Confidentiality.  The terms of this License Agreement shall be
maintained in strict confidence by the Parties except:  (a) as provided by
Section 4 of the Settlement Agreement; (b) that Neos may disclose such terms as
may be necessary or useful in connection with any litigation or other proceeding
relating to any of the Licensed Patents, so long as Neos notifies Teva 14 days
prior to such disclosure and such disclosure is made pursuant to either: 
(1) the highest level of confidentiality under a protective order; or (2) a
confidentiality agreement that restricts access to outside counsel only;
(c) that any Party may disclose such terms if and as required by law, including,
without limitation, SEC reporting requirements, disclosure requirements to a
Party’s bondholders, noteholders, or debtholders, or the disclosure requirements
of any stock exchange that a Party is subject to; (d) that Teva may disclose
such terms to the FDA or to its manufacturers, suppliers and distributors as may
be necessary or useful in obtaining and maintaining final approval of the Teva
ANDA and launching the generic products that are the subject of the Teva ANDA
when and as permitted by the License Agreement, so long as Teva requests that
the FDA and such manufacturers, suppliers and distributors, as applicable,
maintain such terms in confidence; (e) that any party may disclose the terms of
this Agreement to its Affiliates and/or any Third Party in connection with a
potential or actual merger, reorganization, investment, change of control, or
sale of all or substantially all of the applicable business or assets of the
party to which this Agreement relates, and/or to any Third Party in connection
with any divestiture of the Teva ANDA, Neos NDA, or any of the Licensed Patents,
so long as such disclosure is made pursuant to a confidentiality agreement that
is at least as restrictive with respect to access as the terms of this
Agreement; (f) that any Party may disclose such terms to its accountants,
auditors, and/or attorneys as required for them to perform their duties, so long
as such disclosure is made subject to a confidentiality agreement or
professional confidentiality obligation; and (g) that the Parties may each issue
a press release disclosing that the Parties have settled the Action, and that
Teva has received a license under the Licensed Patents that will permit Teva to
commercially launch the Licensed Products on the Launch Date, or earlier in
certain circumstances, so long as such press release is approved by the other
Parties, which approval shall not be unreasonably delayed, conditioned, or
withheld.  The Parties acknowledge and agree that, upon its filing with the
Court, the Stipulation And Order will be a matter of public record and shall not
be subject to any confidentiality restrictions.  The Parties further agree that,
upon the filing of the Stipulation And Order with the Court, the fact that the
Parties have settled the Action will be a matter of public record and shall not
be subject

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

9

--------------------------------------------------------------------------------

 

to any confidentiality restrictions, but that the terms of such settlement shall
be maintained in confidence as provided by this Section 8.

 

9.             Representations

 

9.1          Teva represents that, to the best of its knowledge and belief, Teva
is a First Filer, as defined by Section 1.12 of this License Agreement.

 

9.2          Neos represents that, as of the Execution Date, Neos has not
entered into any agreement with any Third Party granting such party a license to
Market a Generic Equivalent in the Territory.

 

9.3          Each Party represents and warrants to the other Parties that the
execution and delivery by such Party of this License Agreement and the
performance of its obligations under this License Agreement and the Settlement
Agreement have been duly authorized by all necessary corporate action and do not
conflict with the terms of any other contract, agreement, arrangement, or
understanding to which such Party is a party.

 

9.4          Neos represents and warrants that it has the right to license
and/or sublicense, as applicable, the Licensed Patents to Teva under the terms
and conditions set forth in the Agreement and this License Agreement.

 

9.5          Neos represents and warrants that the terms of the License
Agreement being offered to Teva are and will be equivalent to or better than the
terms being offered by Neos or its Affiliates to any Third Party with respect to
any license(s) or other permissions(s) to Generic Equivalent(s) (“Third Party
Agreement”) with respect to Sections 2.1, 2.2, 5, and 6 of this License
Agreement (License, Pre-Booking Activities, Accelerators, and At Risk Launch). 
If Neos and/or its Affiliates enters into a Third Party Agreement providing such
Third Party with more favorable terms with respect to Sections 2.1, 2.2, 5,
and/or 6, of this License Agreement, then the applicable terms in this License
Agreement will be automatically amended to provide such more favorable terms to
Teva.  Neos shall notify Teva of any more favorable terms within five
(5) business days.

 

9.6          Each Party represents and warrants to the other Parties that the
explicit terms of the Agreement and this License Agreement reflect the sole
consideration being exchanged between or among any of the Parties in connection
with settling the Action and resolving their dispute regarding the Teva ANDA and
that no other form of compensation or other accommodation has been made between
or among any of the Parties.

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

10

--------------------------------------------------------------------------------

 

10.          Covenants; Patent Challenges and Listings; Limitations on
Representations

 

10.1        Covenants; Patent Listings and Paragraph IV Certifications.

 

(a)           [***]

 

(b)           During the Term, and provided that Teva and its Affiliates comply
with the terms of this License Agreement and the Settlement Agreement, Neos and
its Affiliates covenant not to sue Teva or its Affiliates, or any of their
predecessors, successors, parents, subsidiaries, shareholders, assigns,
licensees, sublicensees, agents, administrators, attorneys, directors, officers,
employees, representatives, manufacturers, importers, suppliers, distributors,
customers, and insurers, or support or encourage any Third Party to sue, for
infringement of any United States or foreign patents owned, exclusively licensed
or otherwise controlled, wholly or in part, now or in the future, by Neos and/or
any of its Affiliates in connection with the making, using, selling, or offering
for sale of the Licensed Products in the Territory and/or the making or having
made the Licensed Products outside of the Territory solely for importation into
the Territory for subsequent use, sale, or offer for sale in the Territory. 
Neos and its Affiliates shall impose this covenant not to sue on any Third Party
to which Neos or any of its Affiliates may after the Execution Date assign,
license or otherwise transfer or grant any patent rights subject to this
covenant not to sue.

 

(c)           For all patents listed in the FDA publication Approved Drug
Products With Therapeutic Equivalent Evaluations now or in the future for
COTEMPLA XR-ODT™ and/or the Neos NDA, the foregoing covenant not to sue shall
hereby be treated as a non-exclusive license to such patents in connection with
the Teva ANDA solely for the purpose of allowing Teva and/or its Affiliates to
file and maintain with the FDA a certification pursuant to 21 U.S.C.
§ 355(j)(2)(A)(vii)(IV) (as amended or replaced) with respect thereto.  In
connection with the Teva ANDA, Teva shall have the right to maintain its
existing certifications and/or re-certify under 21 U.S.C.
§ 355(j)(2)(A)(vii)(IV) (as amended or replaced) against any Licensed Patents
listed in the FDA publication Approved Drug Products With Therapeutic Equivalent
Evaluations in connection with COTEMPLA XR-ODT™ as of the Execution Date.  In
connection with the Teva ANDA, Teva also shall have the right to file a new
certification under 21 U.S.C. § 355(j)(2)(A)(vii)(IV) (as amended or replaced)
against any Licensed Patents listed in the FDA publication Approved Drug
Products With Therapeutic Equivalent Evaluations in connection with COTEMPLA
XR-ODT™ after the Execution Date.

 

10.2        Limitation on Representations and Warranties.  NEITHER PARTY SHALL
BE DEEMED TO MAKE ANY REPRESENTATIONS OR WARRANTIES, WHETHER EXPRESS OR IMPLIED,
EXCEPT AS SPECIFICALLY SET FORTH HEREIN.  ALL OTHER WARRANTIES, EXPRESS OR
IMPLIED, INCLUDING, WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE ARE HEREBY DISCLAIMED BY
EACH PARTY.  IN NO EVENT SHALL EITHER PARTY HAVE ANY LIABILITY TO THE OTHER FOR
INDIRECT, PUNITIVE, CONSEQUENTIAL, OR OTHER REMOTE MEASURES OF DAMAGES IN
CONNECTION WITH ANY LICENSED PRODUCTS SOLD OR

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

11

--------------------------------------------------------------------------------

 

DISTRIBUTED BY SUCH PARTY OR OTHERWISE ARISING IN RESPECT OF THIS LICENSE
AGREEMENT.

 

10.3        Certain Rights Unaffected.  The Parties acknowledge that nothing set
forth in this License Agreement, including, without limitation, the provisions
of Section 10.2 above, shall be deemed to limit or otherwise affect the
availability of any rights or remedies arising at law or equity to which Neos
may be entitled as a result of the sale or distribution in the Territory by Teva
or any Affiliate of the Licensed Products or any Generic Equivalent prior to the
Launch Date set forth in this License Agreement.

 

11.          Trademarks and Trade Names

 

11.1        Teva shall have no right to use the Trademark or any of Neos’s or
its Affiliates’ corporate names, brands, or logos and shall have no rights to or
under any intellectual property or regulatory exclusivities or approvals held by
Neos or its Affiliates (including patents or other intellectual property
relating to the consistency, formulation, or manufacturing processes for the NDA
Product) other than to the extent of the Teva License.

 

12.          Term and Termination

 

12.1        Expiration.  Unless earlier terminated in accordance with the terms
hereof, the term of this License Agreement (the “Term”) shall extend from the
Effective Date until the earlier of:  (a) the expiration of the last to expire
of the Licensed Patents; or (b) the date of a Final Court Decision that all of
the Licensed Patents are invalid or unenforceable.  For the avoidance of doubt,
the Licensed Patents include all extensions and pediatric exclusivities, in each
case whether granted or allowed before, on, or after the Execution Date, and the
Term shall run until the last to expire of such extensions and pediatric
exclusivities, whenever granted.

 

12.2        Breach.  Each Party may terminate this License Agreement and its
obligations hereunder in the event of a material breach by the other Party that
remains uncured for thirty (30) calendar days after the other Party specifies in
reasonable detail in writing the nature of the breach and demands its cure.

 

(a)           The Parties acknowledge and agree that any Marketing by Teva
and/or any of its Affiliates, API Affiliates, or Wholesaler Affiliates of any of
the Licensed Products in the Territory prior to the Launch Date (as such Launch
Date may be accelerated pursuant to the explicit terms of Section 5 above, and
with the exception of Pre-Booking Activities described in Section 2.2) and
outside of any Teva At Risk Period specifically provided for by Section 6 above
shall constitute such a significant breach of this License Agreement that Neos
may terminate this License Agreement immediately without any notice or
opportunity to cure.

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

12

--------------------------------------------------------------------------------

 

12.3        Expiration or termination of this License Agreement shall not
relieve the Parties of any obligation accruing prior to such expiration or
termination.  Any expiration or early termination of this License Agreement
shall be without prejudice to the rights of any Party against any other Party
accrued or accruing under this License Agreement prior to termination.

 

13.  Miscellaneous

 

13.1        Notice.  Any notice required or permitted to be given or sent under
this License Agreement shall be hand delivered or sent by express delivery
service to the Parties at the addresses indicated below.

 

If to Neos, to:

Mr. Richard Eisenstadt

 

Chief Financial Officer

 

Neos Therapeutics, Inc.

 

2940 North Highway 360

 

Suite 400

 

Grand Prairie, Texas 75050

 

 

with a copy to:

Peter J. Armenio, P.C.

 

Quinn Emanuel Urquhart & Sullivan, LLP

 

51 Madison Avenue

 

New York, New York 10010

 

 

If to Teva, to:

Colman B. Ragan, Esq.

 

Vice President & General Counsel

 

North America Intellectual Property Litigation

 

Teva Pharmaceuticals USA, Inc.

 

400 Interpace Parkway

 

Parsippany, NJ 07054

 

 

with a copy to:

Michael Nutter, Esq.

 

Winston & Strawn LLP

 

35 W. Wacker Drive

 

Chicago, IL 60601

 

Any such notice shall be deemed to have been received on the date actually
received.  Either Party may change its notice information above by giving the
other Parties written notice, delivered in accordance with this Section.

 

13.2        Assignment.  This License Agreement shall not be assignable in whole
or in part by any Party to any Third Party without the prior written consent of
the other Parties,

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

13

--------------------------------------------------------------------------------

 

which shall not be unreasonably withheld, delayed, or conditioned. 
Notwithstanding the foregoing, any Party may assign its rights and obligations
under the Settlement Agreement and/or this License Agreement to any of its
Affiliates.  Further, Teva may assign this License Agreement to any successor to
all or substantially all of the business of Teva, whether through a merger,
reorganization, consolidation, change of control, sale of stock, sale of all or
substantially all of the applicable business or assets of Teva to which this
Agreement relates, so long as such successor agrees in writing for the benefit
of Neos and its Affiliates to assume all of the obligations of Teva hereunder. 
In addition, Neos may assign this License Agreement to any Third Party successor
or assign of any of the Licensed Patents or the COTEMPLA XR-ODT™ business
generally, so long as such successor agrees in writing for the benefit of Teva
and its Affiliates to assume all of the obligations of a Plaintiff hereunder. 
This License Agreement shall be binding upon, and inure to the benefit of, the
permitted successors and assigns of each Party.  Any purported assignment of a
Party’s rights or obligations under the Settlement Agreement and/or this License
Agreement in violation of the foregoing shall be null and void ab initio and of
no force or effect.

 

13.3        Amendment.  This License Agreement may not be changed, waived,
discharged, or terminated orally, but only by an instrument in writing signed by
the Party against which enforcement of such change, waiver, discharge or
termination is sought.

 

13.4        Superiority of Agreements.  The Parties agree that the provisions of
this License Agreement, together with the Agreement and any permitted amendments
to either such agreement, supersede and shall prevail over any statements,
understandings, promises, or provisions contained in any prior discussions,
arrangements, or communications between the Parties or in any documents passing
between the Parties.  Notwithstanding anything herein to the contrary, the
Agreement and this License Agreement shall be construed together in a consistent
manner as reflecting a single intent and purpose.

 

13.5        Governing Law.  This License Agreement shall be governed,
interpreted, and construed in accordance with the laws of the State of Delaware,
without giving effect to choice of law principles.  The Parties expressly
exclude application of the United Nations Convention for the International Sale
of Goods.  The Parties irrevocably agree that the federal district court in the
State of Delaware shall have exclusive jurisdiction to deal with any disputes
arising out of or in connection with this License Agreement and that,
accordingly, any such proceeding arising out of or in connection with this
License Agreement shall be brought in the United States District Court for the
District of Delaware.  Notwithstanding the foregoing, if there is any dispute
for which the federal district court in the State of Delaware does not have
subject matter jurisdiction, the state courts in Delaware shall have
jurisdiction.  In connection with any dispute arising out of or in connection
with this License Agreement, each Party hereby expressly consents and submits to
the personal jurisdiction of the federal and state courts located in the State
of Delaware.

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

14

--------------------------------------------------------------------------------

 

13.6        Counterparts.  This License Agreement may be executed simultaneously
in several counterparts, including facsimile and/or e-mail counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.

 

13.7        Captions.  The captions of this License Agreement are solely for
convenience of reference and shall not affect its interpretation.

 

13.8        Negation of Agency.  Nothing contained herein shall be deemed to
create any relationship, whether in the nature of agency, joint venture,
partnership, or otherwise, between Teva and Neos.  No Party shall be authorized
to bind or obligate any other Party in any manner.  Nothing in this License
Agreement, the Settlement Agreement, or any of the Settlement Documents shall be
interpreted as Neos or its Affiliates consenting to the accuracy or sufficiency
of any scientific, medical, bioequivalence, regulatory, or other information
contained in the Teva ANDA and/or consenting to the FDA approving the Teva ANDA
on the basis of any such information.  Nothing in this License Agreement, the
Settlement Agreement, or any of the Settlement Documents shall be interpreted as
Teva or its Affiliates consenting to the accuracy or sufficiency of any
scientific, medical, bioequivalence, regulatory, or other information contained
in NDA 205489 and/or consenting to the FDA approving NDA 205489 on the basis of
any such information.

 

* * * * *

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

15

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, and intending to be legally bound, the undersigned have
executed this License Agreement as of the date and year first above written.

 

NEOS THERAPEUTICS, INC.

NEOS THERAPEUTICS, LP

 

 

 

 

By:

/s/ Richard Eisenstadt

 

By:

/s/ Richard Eisenstadt

Name:

Richard Eisenstadt

 

Name:

Richard Eisenstadt

Title:

Chief Financial Officer

 

Title:

Chief Financial Officer

 

 

 

 

TEVA PHARMACEUTICALS USA, INC.

TEVA PHARMACEUTICALS USA, INC.

 

 

 

 

By:

/s/ Hafrun Fridriksdottir

 

By:

/s/ Colman Ragan

Name:

Hafrun Fridriksdottir

 

Name:

Colman Ragan

Title:

EVP Global R&D

 

Title:

VP & GC North America

 

 

 

 

IP Litigation

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

16

--------------------------------------------------------------------------------

 

EXHIBIT C

 

Confirmatory Letter To FDA

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

17

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Dear [FDA],

 

Pursuant to 21 C.F.R. § 314.94(a)(12)(v), Neos Therapeutics, Inc. and Neos
Therapeutics, LP (collectively, “Neos”) hereby state that:

 

1.             Neos is the owner of New Drug Application No. 205489 and U.S.
Patent Nos. 8,840,924; 9,072,680; and 9,089,496; and

 

2.             Neos and Teva Pharmaceutical USA, Inc. (“Teva”) have reached a
settlement of the following litigation pending in the U.S. District Court for
the District of Delaware concerning ANDA No. 210924:  Neos Therapeutics, Inc. et
al. v. Teva Pharmaceuticals USA, Inc., Civil Action No. 17-1793-CFC (D. Del.);
and

 

3.             Under the confidential terms of the settlement agreed to by Neos
and Teva, and using the exact language of 21 C.F.R. § 314.94(a)(12)(v), Neos
“has a licensing agreement” with Teva that permits Teva to sell the generic
product defined by ANDA No. 210924 as of July 1, 2026 under license from Neos. 
Given this licensing agreement, and under the terms and conditions set forth
therein, Neos “consents to approval of ANDA No. 210924” as soon as it is
otherwise eligible for FDA approval.  Given the licensing agreement referenced
above, there are no patent disputes preventing effective approval of ANDA
No. 210924 as soon as it is otherwise eligible for FDA approval.

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.

 

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