Exhibit 4.8


CONFIDENTIAL
TREATMENT REQUESTED


 


[***] –
CONFIDENTIAL PORTIONS OF THIS AGREEMENT WHICH HAVE BEEN


REDACTED ARE
MARKED WITH BRACKETS (“[***]”). THE OMITTED MATERIAL HAS


BEEN FILED SEPARATELY
WITH THE UNITED STATES SECURITIES AND EXCHANGE


COMMISSION.


 


ROYALTY AGREEMENT


 


THIS ROYALTY AGREEMENT (this “Agreement”)
is dated as of December 31, 2012, by and among ÉCLAT PHARMACEUTICALS, LLC (the “Payor”),
and DEERFIELD PRIVATE DESIGN FUND II, L.P. and HORIZON SANTÉ FLML, SARL (the “Buyers”).


 


Whereas, the Payor desires to sell, and
the Buyers desire to purchase, a royalty on the net sales of certain products now or hereafter sold by the Payor for the consideration
and on the terms set forth herein, the Parties to this Agreement, intending to be legally bound, agree as follows:


 


1.          Definitions.         Certain
capitalized terms used in this Agreement are defined in Exhibit A.


 


2.          Royalty.



 


(a)          Royalty
Amount. The Payor shall pay 1.75% of Net Sales of Products (the “Royalty”) to the Buyers.


 


(b)          Payment
of the Royalty. The Royalty shall accrue daily and shall be paid quarterly in arrears for each calendar quarter from and after
the date hereof until the expiration of the quarter ending December 31, 2024 (the “Royalty Term”).
No later than two Business Days following the date Flamel Technologies SA (“Flamel”) files its Earnings
Report for each calendar quarter or if Flamel is not obligated to file reports under the Securities Exchange Act of l934, following
its preparation of its internal financial statements (but in no event later than sixty days following the last day of each of the
first three quarters and one hundred twenty days following the last day of the fourth quarter of each calendar year), the Payor
shall pay or cause to be paid to Buyers the Royalty for such quarter (each, a “Royalty Payment”), together
with a statement showing all Net Sales of Products and the computation of the Royalty for such quarter (each a “Royalty
Calculation”). All Royalty Payments shall be made by wire transfer of immediately available funds to the account(s)
designated in writing by the Buyers no later than five Business Days prior to the date such Royalty Payment shall be due.


 


(c)          Delinquent
Royalty Payments. Any Royalty Payment not paid when due shall bear interest at the Default Rate, compounded daily, or the
highest rate then permitted by applicable law, whichever is less. 


 




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(d)          Audit
Right. Upon not less than ten Business Days notice (the “Audit Notice”), the Buyers may audit the
books and records of the Payor once every calendar year to determine the computation of any Royalty Payment for up to three years
prior to the date of the Audit Notice, provided that no audit for a given year shall be repeated pursuant to this provision, but
shall be final in all respects for the period reviewed upon completion of the audit. Such audit shall be conducted during normal
business hours at the Buyers’ cost, provided that any Representative involved enters into a reasonable confidentiality agreement
with the Payor (to be approved by the Payor in its sole reasonable discretion) prior to commencing any such audit. The Payor shall
provide the Buyers and their Representatives with reasonable access to all such books and records and shall reasonably cooperate
with the Buyers’ and their Representatives’ efforts to conduct such audits. The Buyers may
object to any Royalty Calculation by delivering a notice of objection (a “Royalty Objection Notice”),
which shall specify the disputed items in the Royalty Calculation and shall describe in reasonable detail the basis for such objection,
as well as the amount in dispute. If the Buyers deliver Payor such Notice, Payor and Buyers shall negotiate in good faith for up
to ten Business Days to resolve the disputed items and agree upon the resulting amount of the disputed Royalty Payment.
If Payor and Buyers are unable to reach such agreement, all unresolved disputed items shall be promptly referred to the Reviewing
Accountant. The Reviewing Accountant shall render a written report on only such items as promptly as practicable, but in no event
greater than 30 days after such referral. If disputed items are submitted to the Reviewing Accountant, Payor and Buyers shall furnish
to the Reviewing Accountant such work papers, schedules and other documents and information relating to the items as the Reviewing
Accountant may reasonably request. The Reviewing Accountant shall resolve the disputed items based solely on the provisions of
this Agreement and the presentations by Payor and Buyers, and not by independent review. The Reviewing Accountant will not
have the power to amend this Agreement. The resolution of the dispute and the calculation of the Royalty
Payment by the Reviewing Accountant shall be final and binding on the Payor and the Buyers. If
there has been an underpayment of the Royalty Payment due for the period being audited of more than five percent (5%) of the amount
due for the period, the Payor shall reimburse the Buyers for the reasonable out-of-pocket costs (including the Reviewing Accountants’
fees) incurred by the Buyers pursuant to this Section 2(d).


 


(e)          Sale
of Products; Assignment or Sublicenses. The Payor shall pay the Royalty Payments on all Product sales by Flamel and its Affiliates
and all direct or indirect licensees and assignees or successive licensee and assignees of any rights to sell, market or otherwise
distribute Products, and the provisions of this Section 2 shall apply to all such sales as if made directly by the Payor.


 


3.          Purchase
Price. In consideration of the sale and payment of the Royalty, each Buyer shall pay to the Payor the amount set forth next
to such Buyer’s name on Exhibit B hereto in such manner as the Payor shall direct.


 


 


 




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4.          Covenants
of the Payor


 


(a)          
Regulatory Approvals. The Payor shall use all commercially reasonable efforts to obtain approval of each NDA necessary
to sell each Product in the United States of America. Without limiting the foregoing, the Payor shall (A) initiate development
and manufacturing of all Products through a third-party (if this has not already occurred as of date of this Agreement) and (B)
pursue a pre-IND/pre-NDA meeting with the FDA for each Product (if this has not already occurred as of the date of this Agreement).
The Payor shall also use commercially reasonable efforts to (x) cause registration batches of each Product to be manufactured and
(y) cause stability testing to be completed for each Product, in each case unless the FDA states in such meeting that such Product
would not be approved without clinical trials or other unexpected conditions to approval that would make continued efforts to obtain
the NDA necessary to commercialize the Product not commercially viable.


 


(b)          Marketing
of Products. Upon approval to market any Product, the Payor shall take all commercially reasonable and appropriate actions
to manufacture or have manufactured, package, label, distribute, offer for sale and sell such Product.


 


(c)          Credit
Facility Restrictions. The Payor represents and warrants that there are no restrictions or limitations on its ability to make
the payments that are or may be required to be paid to the Buyers under this Agreement in any Contract. The Payor shall not enter
into, or amend, any Contract of it or its Affiliates after the date hereof the effect of which is to place any restrictions or
limitations on the Payor’s ability to make the payments that are required to be paid to the Buyers under this Agreement.


 


(d)          No
Transfer Without Consent. The Payor shall not transfer (whether by sale, assignment, merger, change of control, conveyance
of rights, deed of trust, lien, license, sublicense, seizure or other transfer of any sort, voluntary or involuntary, including
by operation of law) any of its right, title or interest in or to the Product Intellectual Property or Product Regulatory Rights
unless the assignee/transferee agrees in writing to assume (in addition to the Payor) all of the Payor’s obligations under
this Agreement; provided, however, that such requirement shall not apply to (i) the direct or indirect license of
Product Intellectual Property or Product Regulatory Rights to make, have made, use, promote, import, offer to sell or sell Products
solely on behalf of, or for the benefit of, the Payor or (ii) the direct or indirect license of Product Intellectual Property or
Product Regulatory Rights for any other reason.


 


(e)          Acceleration.
Notwithstanding anything to the contrary contained in this Agreement, upon and at any time after the occurrence of any Acceleration
Trigger Event, (x) an amount equal to the Accelerated Value shall automatically become immediately due and payable without presentment,
demand, protest, notice of intent to accelerate or other notice or legal process of any kind, all of which are hereby knowingly
and expressly waived by the Payor, and (y) the Buyers may exercise any and all other rights and remedies available to them under
this Agreement and applicable law. At least once per year, the Payor will update in good faith its sales projections for the Products
for such period as the Buyers shall reasonably request..


 


5.          Representations
and Warranties of the Payor. The Payor represents and warrants to the Buyers as follows as of the date of this Agreement:


 


(a)          Organization;
Good Standing. The Payor is duly organized, validly existing and in good standing under the laws of the jurisdiction of its
formation. The Payor has the requisite power and authority to own, lease or use its properties and assets and to conduct its business
as presently conducted.


  




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[***] –
CONFIDENTIAL PORTIONS OF THIS AGREEMENT WHICH HAVE BEEN


REDACTED ARE
MARKED WITH BRACKETS (“[***]”). THE OMITTED MATERIAL HAS


BEEN FILED SEPARATELY
WITH THE UNITED STATES SECURITIES AND EXCHANGE


COMMISSION.


 


(b)          Consents
and Approvals; No Violation. Neither the execution and delivery of this Agreement by the Payor nor the performance of its obligations
hereunder nor the consummation by the Payor of the transactions contemplated hereby will: (i) conflict with or result in a breach,
violation, or default of or under the organizational document of the Payor, (ii) require the consent
of, or notice to, any Person under, conflict with, result in a violation or breach of, constitute a default or an event that, with
or without notice or lapse of time or both, would constitute a default under, result in the acceleration of or create in any party
the right to accelerate, terminate, modify or cancel any Contract to which the Payor is a party or by which the Payor is bound
or to which any of its properties and assets are subject or any Governmental Authorization affecting the properties, assets or
business of the Payor, (iii) result in the creation of any Encumbrance (other than Permitted Encumbrances) on the assets
of the Payor, or (iv) conflict with or result in a violation or breach of any provision of any Legal
Requirement applicable to the Payor.


 


(c)          Absence
of Changes. Since March 13, 2012:


 


(i)          There
has been no transfer, assignment, sale, distribution, or Encumbrance of any Product or of any Product Intellectual Property or
Product Regulatory Rights, and there has been no agreement to do so;


 


(ii)         The
Payor has not adopted any plan of consolidation, reorganization, liquidation or dissolution or filed a petition in bankruptcy under
any provisions of federal or state bankruptcy law or consented to the filing of any bankruptcy petition against it under any similar
law;


 


(iii)        The
Payor has not formed any Affiliates, or made any capital investment in or acquired any equity interest in any other Entity;


 


(iv)         To
the knowledge of the Payor, no Person other than the Payor has submitted a product containing the same active pharmaceutical ingredient
for approval by the FDA other than with respect to [***] for a product that is described on an exhibit to this Agreement;


 


(v)          As
of the date hereof, the FDA has not expressed any disapproval, formally or informally, orally or in writing, of the development
program proposed by the Payor for any of the Products.


 


(vi)         As
of the date hereof, the FDA has not formally or informally, orally or in writing, advised the Payor that it does not intend to
approve any Product in the manner proposed by the Payor or based upon the information provided or to be provided by the Payor. 


 




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(d)          Compliance
with Laws.


 


The Payor is in compliance with
all Legal Requirements applicable to it or its business, properties or assets. The Payor has not received any written notice from
any Governmental Body or any other Person regarding (i) any actual, alleged or potential material violation of or material liability
under any Legal Requirement, or (ii) any actual, alleged, or potential material obligation of the Payor to undertake or pay for
any response action required by any Legal Requirement.


 


(e)          Regulatory
Compliance.


 


(i)          The
Payor has not received any notices or correspondence from the FDA or any other Governmental Body exercising comparable authority
requiring the recall, termination or suspension of sale of any Product or otherwise alleging that the Payor is not in compliance
in all material respects with all applicable Legal Requirements.


 


(ii)         Neither
the Payor, nor any officer or employee of the Payor, nor, to the Payor’s knowledge, any agents or contractor of the Payor
is the subject of any pending or threatened investigation by the FDA pursuant to its “Fraud, Untrue Statements of Material
Facts, Bribery, and Illegal Gratuities” Final Policy set forth in 56 Fed. Reg. 46191 (September 10, 1991) and any amendments
thereto, or by any other comparable Governmental Body to invoke any similar policy. None of the Payor nor any officer or employee
of the Payor, nor, to the Payor’s knowledge, any agent or contractor of the Payor has (A) made any untrue statement of material
fact or fraudulent statement to the FDA, DEA, or any other Governmental Body; (B) failed to disclose a material fact required to
be disclosed to the FDA, DEA, or any other Governmental Body, or (C) committed an act, made a statement, or failed to make a statement
that would reasonably be expected to provide the basis for the FDA or any other Governmental Body to invoke the FDA’s “Fraud,
Untrue Statements of Material Facts, Bribery, and Illegal Gratuities” Final Policy.


 


(iii)        Neither
the Payor nor any officer or employee of the Payor has been debarred or been convicted of any crime or engaged in any conduct
that did or could result in debarment under 21 U.S.C. § 335a, exclusion from federal healthcare programs under 42 U.S.C.
§ 1320a-7, disqualification as a clinical investigator under 21 C.F.R. § 312.70 or any similar Legal Requirements,
and none of the Payor or any officer or employee of the Payor has engaged in any conduct that would reasonably be expected to
result in debarment, exclusion, or disqualification from U.S. federal health care programs.


 




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(iv)         Neither
the Payor, nor any officer of the Payor has received any written notice or communication from the FDA, DEA, or other Governmental
Body requiring termination or suspension of sale of any of Product or alleging noncompliance with any applicable FDA Law, DEA Law,
or other applicable Legal Requirements with regard to any Product. Neither the Payor nor any officer of the Payor has been or is
subject to any enforcement proceedings by the FDA, DEA, or other Governmental Body and, to the Payor’s knowledge, no such
proceedings have been threatened.


 


6.          [Reserved]


  


7.          Miscellaneous
Provisions. 


 


(a)          Further
Assurances. Each of the parties hereto shall, and shall cause their respective Affiliates to, execute and deliver such additional
documents, instruments, conveyances and assurances and take such further actions as may be reasonably required to give effect to
the transactions contemplated by this Agreement.


 


(b)          Survival
of Representations and Warranties. The representations and warranties of the parties contained in this Agreement shall survive
and remain in full force and effect through the expiration of the Royalty Term.


 


(c)          Amendment.
This Agreement may not be amended except by an instrument in writing signed by the Payor and the Buyers.


 


(d)          Waiver.
No failure on the part of any Party to exercise any power, right, privilege or remedy under this Agreement, and no delay on the
part of any Party in exercising any power, right, privilege or remedy under this Agreement, shall operate as a waiver of such power,
right, privilege or remedy; and no single or partial exercise of any such power, right, privilege or remedy shall preclude any
other or further exercise thereof or of any other power, right, privilege or remedy.


 


No Party shall be deemed to have
waived any claim arising out of this Agreement, or any power, right, privilege or remedy under this Agreement, unless the waiver
of such claim, power, right, privilege or remedy is expressly set forth in a written instrument duly executed and delivered on
behalf of such Party; and any such waiver shall not be applicable or have any effect except in the specific instance in which it
is given.


 


(e)          Entire
Agreement; Counterparts; Exchanges by Facsimile. This Agreement, and the other agreements referred to in this Agreement constitute
the entire agreement and supersede all prior agreements and understandings, both written and oral, among or between any of the
Parties with respect to the subject matter hereof and thereof; provided, however, that any existing confidentiality
agreements shall not be superseded and shall remain in full force and effect in accordance with its terms. This Agreement may
be executed in several counterparts, each of which shall be deemed an original and all of which shall constitute one and the same
instrument. The exchange of a fully executed Agreement (in counterparts or otherwise) by all Parties by facsimile or portable
document format (PDF) shall be sufficient to bind the Parties to the terms and conditions of this Agreement. 


  




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(f)          Applicable
Law; Jurisdiction. This Agreement shall be governed by, and construed in accordance
with, the laws of the State of New york, regardless of the laws that might otherwise govern under applicable principles of conflicts
of laws.  Each of the Parties to this Agreement (a) consents to submit itself to
the personal jurisdiction of the federal and state Courts of the state of new york in any action or proceeding arising out of or
relating to this Agreement or any of the Transactions Contemplated HEREUNDER, (b) agrees that all claims in respect of such action
or proceeding may be heard and determined in such court, (c) agrees that it shall not attempt to deny or defeat such personal jurisdiction
by motion or other request for leave from any such courts, and (d) agrees not to bring any action or proceeding (including counter-claims)
arising out of or relating to this Agreement or any of the Transactions Contemplated HEREUNDER in any other court. Each of the
Parties waives any defense of inconvenient forum to the maintenance of any action or proceeding so brought and waives any bond,
surety or other security that might be required of any other Party with respect thereto. Any Party may make service on another
Party by sending or delivering a copy of the process to the Party to be served at the address and in the manner provided for the
giving of notices herein. Nothing in this Section 7(f),
however, shall affect the right of any Party to serve legal process in any other manner permitted by law.


 


(g)          Assignability;
No Third Party Beneficiaries. This Agreement shall be binding upon, and shall be enforceable by and inure solely to the benefit
of, the Parties and their respective successors and assigns. No Party may assign any of its rights or obligations hereunder without
the prior written consent of the other Party, and any attempted assignment or delegation of this Agreement or any of such rights
or obligations by such Party without the other Party’s prior written consent shall be void and of no effect; provided that
a Buyer may assign its rights to payments under this Agreement to any other Person without the prior written consent of the Payor
or any other Person. Nothing in this Agreement, express or implied, is intended to or shall confer upon any Person any right, benefit
or remedy of any nature whatsoever under or by reason of this Agreement.


 


(h)          Notices.
Any notice or other communication required or permitted to be delivered to a Party under this Agreement shall be in writing and
shall be deemed properly delivered, given and received when delivered by hand, by registered mail, by courier or express delivery
service or by facsimile to such address or facsimile telephone number as each Party shall have specified in a written notice given
to the other Party.


 




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(i)          Severability.
Any provision of this Agreement that is invalid or unenforceable in any situation in any jurisdiction shall not affect the validity
or enforceability of the remaining provisions of this Agreement or the validity or enforceability of the offending provision in
any other situation or in any other jurisdiction. If a final judgment of a court of competent jurisdiction declares that any provision
of this Agreement is invalid or unenforceable, the Parties agree that the court making such determination shall have the power
to limit such provision, to delete specific words or phrases or to replace such provision with a provision that is valid and enforceable
and that comes closest to expressing the intention of the invalid or unenforceable provision, and this Agreement shall be valid
and enforceable as so modified. If such court does not exercise the power granted to it in the prior sentence, the Parties agree
to replace such invalid or unenforceable provision with a valid and enforceable provision that will achieve, to the extent possible,
the economic, business and other purposes of such invalid or unenforceable provision.


 


(j)          Other
Remedies; Specific Performance. Any and all remedies herein expressly conferred upon a Party will be deemed cumulative with
and not exclusive of any other remedy conferred hereby, or by law or equity upon such Party, and the exercise by a Party of any
one remedy will not preclude the exercise of any other remedy. The Parties agree that irreparable damage would occur in the event
that any provision of this Agreement were not performed in accordance with its specific terms or were otherwise breached. It is
accordingly agreed that the Parties shall be entitled to seek an injunction or injunctions to prevent breaches of this Agreement
and to enforce specifically the provisions hereof, this being in addition to any other remedy to which they are entitled at law
or in equity.


 


(k)          Judgment
Currency. If, for the purpose of obtaining or enforcing judgment against any Party in any court in any jurisdiction with respect
to this Agreement it becomes necessary to convert into any other currency (such other currency being hereinafter referred to as
the “Judgment Currency”) to an amount due in United States dollars, the conversion shall be made at the last
exchange rate published in the Wall Street Journal on the Business Day immediately preceding (the “Exchange Rate”):


 


the date actual payment of the
amount is due, in the case of any proceeding in the courts of Delaware or in the courts of any other jurisdiction that will give
effect to payment being due on such date; or


 


the date on which the French or
any other non U.S. court determines, in the case of any proceeding in the courts of any other jurisdiction (the date as of which
such payment is made being hereinafter referred to as the "Judgment Payment Date").


 


If in the case of any proceeding
in the court of any jurisdiction referred to above, there is a change in the Exchange Rate on the date of calculation prevailing
between the Judgment Payment Date and the date of actual payment of the amount due, the applicable Party shall pay such adjusted
amount as may be necessary to ensure that the amount paid in the Judgment Currency, when converted at the Exchange Rate prevailing
on the date of payment, will produce the amount of United States dollars which could have been purchased with the amount of Judgment
Currency stipulated in the judgment or judicial order at the Exchange Rate prevailing on the Judgment Payment Date.


 


Any amount due from the Payor
under this Section 7(k) shall be due as a separate debt and shall not be affected by judgment being obtained for any other
amount due under or in respect of this Agreement. 


 




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(l)          Construction.
For purposes of this Agreement, whenever the context requires: the singular number shall include the plural, and vice versa; and
any gender shall include all genders.


 


The Parties agree that any rule of construction
to the effect that ambiguities are to be resolved against the drafting Party shall not be applied in the construction or interpretation
of this Agreement.


 


As used in this Agreement, the words “include”
and “including,” and variations thereof, shall not be deemed to be terms of limitation, but rather shall be deemed
to be followed by the words “without limitation.”


 


Except as otherwise indicated, all references
in this Agreement to “Sections,” “Exhibits” and “Schedules” are intended to refer to Sections
of this Agreement and Exhibits and Schedules to this Agreement.


 


The headings contained in this
Agreement are for convenience of reference only, shall not be deemed to be a part of this Agreement and shall not be referred to
in connection with the construction or interpretation of this Agreement.


 


[Remainder of page intentionally left
blank; signature pages follow.]


 




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IN WITNESS WHEREOF, the Parties have
caused this Agreement to be executed as of the date first above written.


 


	ÉCLAT PHARMACEUTICALS, LLC	 
	 	 
	By:	/s/ Michael S. Anderson	 
	Name: Michael S. Anderson	 
	Title: CEO	 


  


	DEERFIELD PRIVATE DESIGN FUND II, L.P.	 
	By: Deerfield Mgmt L.P., its General Partner	 
	 	 
	By: J.E. Flynn Capital, LLC, its General Partner	 
	 	 
	By:	/s/ James E. Flynn	 
	Name: James E. Flynn	 
	Title: President	 


  


	HORIZON SANTÉ FLML, SÀRL	 	 
	 	 	 
	By:  	/s/ Alexis Cazé	 	By: 	 /s/ Florence Gerardy
	Name: Alexis Cazé	 	Name: Florence Gerardy
	Title: Manager A	 	Title: Manager B


 


SIGNATURE PAGE TO ROYALTY PURCHASE AGREEMENT


 




    	 



    	 



    

 


EXHIBIT A


 


CAPITALIZED TERMS


 


“Accelerated Value” shall
mean as of any date of determination, the amount of future Royalty Payments would be paid to Buyers using the Payor’s good
faith projections of future sales of the Products at the time of the Acceleration Trigger Event, discounted to present value as
of the date of the Acceleration Trigger Event using quarterly compounding and a discount rate of 4%.


 


“Acceleration Trigger Event”
shall mean the occurrence of any one or more of the following events:


 


(a)          The
Payor shall (i) file a voluntary petition or commence a voluntary case seeking liquidation, winding-up, reorganization, dissolution,
arrangement, readjustment of debts or any other relief under any applicable bankruptcy, insolvency or similar law now or hereafter
in effect, (ii) apply for or consent to the appointment of or taking possession by a custodian, trustee, receiver or similar official
for or of itself or all or a substantial part of its properties or assets, (iii) fail generally, or admit in writing its inability,
to pay its debts generally as they become due, (iv) make a general assignment for the benefit of creditors or (v) take any action
to authorize or approve any of the foregoing; or


 


(b)          Any
involuntary petition or case shall be filed or commenced against the Payor seeking liquidation, winding-up, reorganization, dissolution,
arrangement, readjustment of debts, the appointment of a custodian, trustee, receiver or similar official for it or all or a substantial
part of its properties or any other relief under any other applicable bankruptcy, insolvency or similar law now or hereafter in
effect, and such petition or case shall continue undismissed and unstayed for a period of 60 days; or an order, judgment or decree
approving or ordering any of the foregoing shall be entered in any such proceeding.


 


“Affiliate”. An
Entity shall be deemed to be a “Affiliate” of another Person if such Person directly or indirectly owns
or purports to own, beneficially or of record, (a) an amount of voting securities of other interests in such Entity that is sufficient
to enable such Person to elect at least a majority of the members of such Entity’s board of directors or other governing
body, or (b) at least 50% of the outstanding equity, voting, beneficial or financial interests in such Entity.


 


“ANDA” means Abbreviated
New Drug Application.


 


“Business Day”
shall mean any day other than a day on which banks in New York, NY or Paris, France are authorized or obligated to be closed. 


 




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“Contract” shall,
with respect to any Person, mean any written, oral or other agreement, contract, subcontract, lease (whether real or personal property),
mortgage, understanding, arrangement, instrument, note, option, warranty, purchase order, license, sublicense, insurance policy,
benefit plan or legally binding commitment or undertaking of any nature to which such Person is a party or by which such Person
or any of its assets are bound or affected under applicable law.


 


“Copyright” means
all copyrights and moral rights, including the legal right provided by the Copyright Act of 1976, as amended, to the expression
contained in any work of authorship fixed in any tangible medium of expression together with any similar rights arising in any
other country as a result of statute or treaty, and all registrations, applications, renewals, extensions and reversions thereof.


 


“DEA” means the
United States Drug Enforcement Administration or any successor agency thereto.


 


“Default Rate”
shall mean 15% per annum or such lesser rate as shall be allowable by law.


 


“Earnings Report”
means during any period when Flamel is obligated to file reports under the provisions of the Securities Exchange Act of 1934, the
Form 6-K filed by Flamel containing its financial information for such quarter.


 


“Encumbrance”
shall mean any lien, pledge, hypothecation, charge, mortgage, security interest, encumbrance, easement, condition, preemptive right,
community property interest, right of first refusal or right of first offer, or similar restriction of any kind, including any
restriction on the voting of any security or equity interest, any restriction on the transfer of any security, equity interest
or other asset, and any restriction on the receipt of any income or exercise of any other attribute of ownership, under any Legal
Requirement.


 


“Entity” shall
mean any corporation (including any non-profit corporation), partnership (including any general partnership, limited partnership
or limited liability partnership), joint venture, estate, trust, company (including any company limited by shares, limited liability
company or joint stock company), firm, society or other enterprise, association, organization or entity.


 


“FDA” means the
United States Food and Drug Administration or any successor agency thereto.


 


“Governmental Authorization”
shall mean any: (a) permit, license, certificate, franchise, permission, variance, exceptions, orders, clearance, registration,
qualification or authorization issued, granted, given or otherwise made available by or under the authority of any Governmental
Body or pursuant to any Legal Requirement; or (b) right under any Contract with any Governmental Body.


 




    	A-2



    	 



    

 


“Governmental Body”
shall mean any: (a) nation, state, commonwealth, province, territory, county, municipality, district or other jurisdiction of any
nature; (b) federal, state, local, municipal, foreign or other government; (c) governmental or quasi-governmental authority of
any nature (including any governmental division, department, agency, commission, instrumentality, official, ministry, fund, foundation,
center, organization, unit, body or other Entity and any court or other tribunal, and for the avoidance of doubt, any Taxing authority);
or (d) self-regulatory organization (including the NASDAQ Global Market).


 


“Know-How” means
ideas, designs, concepts, compilations of information methods, techniques, methodologies, procedures and processes, compositions,
specifications, techniques, technical data and information, designs, drawings, customer lists, supplier lists, pricing and financial
information, plans and proposals, algorithms and formulas, whether or not patentable.


 


“Legal Requirement”
shall mean any federal, state, foreign, local or municipal or other law, statute, constitution, principle of common law, resolution,
ordinance, code, edict, decree, rule, regulation, judgment, ruling or requirement issued, enacted, adopted, promulgated, implemented
or otherwise put into effect by or under the authority of any Governmental Body.


 


“Mark” means any
word, name, symbol, logos or device used by a Person to identify its goods or services, whether or not registered, all goodwill
associated therewith, and any right that may exist to obtain a registration with respect thereto from any Governmental Body and
any rights arising under any such application, together with all registrations, renewals, extensions and reversions thereof. As
used in this Agreement, the term “Mark” includes all of the foregoing, including trademarks and service marks.


 


“Net Sales” shall
mean, without duplication, the gross amount invoiced for Products sold globally in bona fide, arm’s length transactions,
less customary deductions determined without duplication in accordance with the selling Person’s customary accounting methods
as generally and consistently applied for: (i) cash or terms discounts, (ii) sales, use and value added taxes (if and only to the
extent included in the gross invoice amount), (iii) reasonable and customary accruals for third party rebates and chargebacks,
(iv) returns and (v) recalls.


 


“Party” or “Parties”
shall mean the Buyers and the Payor.


 


“Patent” means
any patent granted by the United States Patent and Trademark Office or by the comparable agency of any other country, and any renewal,
thereof, and any rights arising under any patent application filed with the United States Patent and Trademark Office or the comparable
agency of any other country and any rights that may exist to file any such application, including all continuations, divisional,
continuations-in-part and provisionals and patents issuing thereon, and all reissues, reexaminations, substitutions,
renewals and extensions thereof.


  




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[***] –
CONFIDENTIAL PORTIONS OF THIS AGREEMENT WHICH HAVE BEEN


REDACTED ARE
MARKED WITH BRACKETS (“[***]”). THE OMITTED MATERIAL HAS


BEEN FILED SEPARATELY
WITH THE UNITED STATES SECURITIES AND EXCHANGE


COMMISSION.


   


“Permitted Encumbrances”
means (a) statutory liens for Taxes that are not yet due and payable or Taxes that are being contested in good faith by appropriate
proceedings; (b) statutory, common law or civil law liens to secure obligations to landlords, lessors or renters under leases or
rental agreements confined to the premises rented pursuant to and which are not, individually or in
the aggregate, material to the business of the Payor; (c) deposits or pledges made in connection with, or to secure payment
of, workers’ compensation, unemployment insurance, old age pension or other social security programs mandated under Legal
Requirements, which are not, individually or in the aggregate, material to the business of the Payor;
(d) statutory, common or civil law liens in favor of carriers, warehousemen, mechanics and materialmen to secure claims for labor,
materials or supplies and other like liens with respect to amounts not yet due and payable, which are
not, individually or in the aggregate, material to the business of the Payor.


 


“Person” shall
mean any individual, Entity or Governmental Body.


 


“Product Intellectual Property”
shall mean all Proprietary Rights held or licensed by the Payor and Flamel and their Affiliates that is, or may hereafter be, necessary
to develop, make, have made, promote, market or sell the Products in the United States.


 


“Product Regulatory Rights”
shall mean each and every investigational new drug application or new drug application and/or state license or registration that
is held or obtained (if any) that is necessary to develop, conduct clinical trials relating to, manufacture, have manufactured,
distribute, promote, market or sell the Products in the United States.


 


“Products” shall
mean (i) the drugs [***], [***], [***] and [***], and (ii) [***].


 


“Proprietary Rights”
means, with respect to a Person, all Copyrights, Marks, Trade Names, Trade Secrets, Patents, intellectual property rights in inventions
and discoveries, intellectual property rights in internet web sites and internet domain names and subdomain names and intellectual
property rights in Know-How, owned or used by such Person.


 


“Representatives”
shall mean directors, officers, other employees, agents, attorneys, accountants, advisors and representatives.


 




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“Reviewing Accountant”
means Grant Thornton or such other accounting firm designated by the Buyers.


 


“Tax” shall mean
any federal, state, local, foreign or other taxes, levies, charges and fees or other similar assessments or liabilities in the
nature of a tax, including, without limitation, any income tax, franchise tax, capital gains tax, gross receipts tax, value-added
tax, surtax, estimated tax, unemployment tax, national health insurance tax, excise tax, ad valorem tax, transfer tax, stamp tax,
sales tax, use tax, property tax, business tax, withholding tax, payroll tax, customs duty, alternative or add-on minimum or other
tax of any kind whatsoever, and including any fine, penalty, assessment, addition to tax or interest, whether disputed or not.


 


“Trade Names”
means any words, name or symbol used by a Person to identify its business.


 


“Trade Secrets”
means business or technical information of any Person including, but not limited to, customer lists, marketing data and Know-How,
that is not generally known to other Persons who are not subject to an obligation of nondisclosure and that derives actual or
potential commercial value from not being generally known to other Persons. 


 




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EXHIBIT B


 


ALLOCATION OF PURCHASE PRICE


 


	Buyers	 	Purchase Price	 
	Deerfield Private Design Fund II, L.P.	 	$	1,211,600	 
	Horizon Santé FLML Sarl	 	$	1,388,400	 
	Total:	 	$	2,600,000	 



 




    	B-1