Document:

Settlement and License Agreement by and among Somaxon Pharmaceuticals

 Exhibit 10.3 
 CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT (INDICATED BY ASTERISKS) HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT. 
 SETTLEMENT AND LICENSE AGREEMENT 

This SETTLEMENT AND LICENSE AGREEMENT (this “Agreement”) is hereby entered into on July 17, 2012 (the “Execution
Date”) by and among Somaxon Pharmaceuticals, Inc., a corporation organized and existing under the laws of the State of Delaware (“Somaxon”), ProCom One, Inc., a corporation organized and existing under the laws of the State
of Texas (“ProCom”), (Somaxon and ProCom are collectively “Plaintiffs”), Par Pharmaceutical, Inc. a corporation organized and existing under the laws of the State of Delaware, and Par Pharmaceutical Companies, Inc.
a corporation organized and existing under the laws of the State of Delaware (Par Pharmaceutical, Inc. and Par Pharmaceutical Companies, Inc. are collectively “Par” or “Defendants”; each Plaintiff and each Defendant
is a “Party”). 
 RECITALS 

WHEREAS, Somaxon is the holder of New Drug Application (“NDA”) No. 22-036 (the “Somaxon NDA”),
which was approved by the United States Food and Drug Administration (“FDA”) for the manufacture and sale of (a) a 3 mg doxepin hydrochloride product, and (b) a 6 mg doxepin hydrochloride product, in each of cases (a)-(b),
that is marketed and sold by Somaxon in the Licensed Territory (as defined below), under the trade name SILENOR®
(the “Silenor Products”); 
 WHEREAS, the formulation and dosing of the Silenor Products are covered by certain claims of the
Licensed Patents (as defined below); 
 WHEREAS, ProCom owns one of the Licensed Patents and Somaxon is the exclusive licensee of that Licensed
Patent in the Licensed Territory; 
 WHEREAS, the Licensed Patents are listed in the Orange Book (as defined below) for each of the strengths of
the Silenor Products approved by the FDA under the Somaxon NDA; 
 WHEREAS, pursuant to 21 USC § 355(j) Par filed Abbreviated New Drug
Application (“ANDA”) No. 202-510 (the “Par ANDA”) with respect to a 3 mg doxepin hydrochloride product and a 6 mg doxepin hydrochloride product, and such ANDA is currently pending before the FDA; 

WHEREAS, Plaintiffs initiated an action against Par in the United States District Court for the District of Delaware (the “District
Court”) under 35 USC § 271(e) alleging infringement of the Licensed Patents, in a case captioned Somaxon Pharmaceuticals, Inc. and ProCom One, Inc. v. Par Pharmaceutical, Inc. et al., Civil Action No. 1:11-cv-00107-RGA/MPT
(D. Del.) (the “Litigation”); 

  
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 WHEREAS, Par has asserted certain affirmative defenses and counterclaims in the Litigation; 

WHEREAS, the Parties have agreed to resolve their disputes relating to the Litigation through this Agreement, in order to avoid further litigation and
the attendant risk, associated fees, costs and expenses thereof; and 
 WHEREAS, as a result of this Agreement there will be an opportunity for
pro-competitive generic competition for doxepin hydrochloride products for human use, which competition otherwise may not have existed until the expiration of the Licensed Patents and any applicable period of exclusivity; 

NOW, THEREFORE, in consideration of the mutual agreements herein contained, the sufficiency and receipt of which are hereby acknowledged, the Parties
hereto, intending to be legally bound hereby, agree as follows: 
 1. DEFINITIONS 

1.1 “Affiliate” means, with respect to an entity, any other entity that controls, is controlled by, or is under common
control with such first entity, where “control” means (a) in the case of corporate entities, direct or indirect ownership of more than fifty percent (50%) of the stock or shares having the right to vote for the election of
directors, and (b) in the case of non-corporate entities, direct or indirect ownership of more than fifty percent (50%) of the equity interest with the power to direct the management and policies of such non-corporate entities. 

1.2 “Authorized Generic Product” means a Generic Product that is manufactured, used, sold, offered for sale or
distributed pursuant to the Somaxon NDA, but that is not marketed under the Trademark. 
 1.3 “Business Day”
means a day on which the banks in the State of Delaware are permitted to be open. 
 1.4 “Covenant Patents”
means any patent, other than the Licensed Patents, owned by or licensed to Plaintiffs as of the Effective Date, that, but for a license, would be infringed by the use, manufacture, sale, offer for sale, or importation of the Par Generic Product in
the Licensed Territory. 
 1.5 “Effective Date” means the date on which the Consent Judgment and Dismissal is
entered by the District Court. 

  
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 1.6 “Entry Date” means, on a dosage strength by dosage strength basis, the
earlier of: 
 (a) 180 days after the date of a Final Decision which adjudges as not infringed, invalid, or unenforceable all
adjudicated claims of the Licensed Patents asserted against a Third Party’s ANDA referencing the Somaxon NDA; 
 (b) 180
days after an Authorized Generic Product or a Licensed Third Party Generic Product is first sold in the Licensed Territory; or 

(c) In the event that, (i) Somaxon has, at the date of the events described in subclause (ii) below, the ability to grant a
license to Par under the Licensed Patents during the period of 180 days immediately following the first commercial sale of a Licensed Third Party Generic Product pursuant to an ANDA (and Par acknowledges and agrees that nothing herein shall restrict
the ability of Somaxon to grant to any Third Party an exclusive or semi-exclusive license under the Licensed Patents where the exclusive or semi-exclusive nature of the license extends for a period of 180 days after first commercial sale by such
Third Party); and (ii) under 21 U.S.C. § 355 (j)(5)(D)(iii), all first applicants who have filed ANDAs referencing the Somaxon NDA forfeit the 180-day exclusivity periods, then the Entry Date shall be the date upon which Par receives final
approval from FDA of the Par ANDA; provided, however, that this clause (c) shall not apply in the event of an occurrence under 21 U.S.C. § 355 (j)(5)(D)(i)(III). 
 Notwithstanding the foregoing, should Somaxon provide a license under the Licensed Patents to a Third Party seeking to commercialize a Generic Product, which Third Party first served a Paragraph IV Notice
Letter to Somaxon with respect to an ANDA referencing the Somaxon NDA on or after December 21, 2010, the terms of this Agreement shall be amended so that the Entry Date would be no later than the comparable date granted to such Third Party by
Somaxon. 
 1.7 “Ex-US Manufacturing Patents” means any patents (other than the Licensed Patents) in the
country in which the Named Affiliate will manufacture Par Generic Products pursuant to Section 5.1(b), in each case to the extent controlled by Somaxon as of the Entry Date and necessary for the Named Affiliate to manufacture Par Generic
Products solely for import into the Licensed Territory for purposes of sale by Par pursuant to this Agreement. For purposes of this definition, “control” means the right to grant a license or sublicense without violating the rights
of any other Person. 
 1.8 “Field” means the field of products AB rated to the Silenor Products in tablet
form. 
 1.9 “Final Decision” means a decision of a court from which no further appeal has been or can be
taken, excluding any petition for a writ of certiorari or other proceedings before the United States Supreme Court. 
 1.10
“Generic Product” means each of the following: (a) a 3 mg doxepin hydrochloride product, and (b) a 6 mg doxepin hydrochloride product, in each of cases (a)-(b), that is an A/B rated generic version of the corresponding
Silenor Product. 

  
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 1.11 “Licensed Patents” means: 

(a) U.S. Patent No. 6,211,229 (together with all reissues, reexaminations and patent and regulatory extensions thereof,
“the ‘229 patent”) together with all continuations, continuations-in-part or divisionals; and 
 (b) U.S.
Patent No. 7,915,307 (together with all reissues, reexaminations and patent and regulatory extensions thereof, “the ‘307 patent”); together with all continuations, continuations-in-part or divisionals. 

1.12 “Licensed Territory” means the United States of America, and its territories, districts and possessions, including
the Commonwealth of Puerto Rico. 
 1.13 “Licensed Third Party Generic Product” means a Generic Product that is
manufactured, used, sold, offered for sale or distributed by a Third Party under license, other agreement or pursuant to a covenant not to sue from Somaxon pursuant to an ANDA referencing the Somaxon NDA. 

1.14 “Net Sales” means, with respect to the Par Generic Products for any period, the total gross sales (i.e., the number
of units shipped times the invoiced price per unit) invoiced by Par and its Affiliates for the sale of the Par Generic Products in the Licensed Territory during such period (“Gross Sales”), less all applicable deductions, to the extent
actually accrued, paid or allowed in the ordinary course of business, and to the extent they are in accordance with generally accepted accounting principles consistently applied. By way of example only, such deductions include, where applicable, but
are not limited to: 
 (a) Cash discounts, quantity discounts, promotional discounts, stocking or other promotional allowances;

 (b) Chargebacks, rebates, administrative fees, and other customary credits and allowances; 

(c) Discounts, rebates or other payments required by law to be made under Medicaid, Medicare, or other governmental special medical
assistance programs; 
 (d) Retroactive price adjustments; 

(e) Allowances or credits to customers by reason of rejection, damages or return of goods, withdrawal, recall, or because of retroactive
price adjustments justified by trade practices; 
 (f) Redistribution center (FDC) fees, information service agreement (ISA)
fees, and other administrative fees that are standard and customary in the industry and related to the sale of the Par Generic Products to customers; 

  
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 (g) Sales and excise taxes, customs and any other taxes, all to the extent added to the
sale price and paid by Par or its Affiliates and not refundable in accordance with applicable law (but not including taxes assessed against the income derived from such sale); and 

(h) Freight, insurance and other transportation charges to the extent added to the sale price and set forth separately as such in the
total amount invoiced. 
 The foregoing deductions from Gross Sales shall only be deducted once and only to the extent not otherwise deducted
from Gross Sales. For the avoidance of doubt, sales of Par Generic Products between or among Par and its Affiliates for resale shall not be included within Net Sales for such product; provided, however, that any subsequent sale of such
Par Generic Products by Par or such Affiliates to a Third Party, or any other payment received by Par or its Affiliates from such Third Parties relating to, as applicable, the Par Generic Products shall be included within Net Sales. For the
avoidance of doubt, Net Sales as calculated for the purposes of this Agreement shall be consistent with Net Sales as calculated for and included in Par’s financial statements contained in its periodic reports with the U.S. Securities and
Exchange Commission. 
 1.15 “Orange Book” means the publication titled “Approved Drug Products with
Therapeutic Equivalence Evaluations,” in electronic or hard copy form, maintained by the FDA, including all supplements thereto. 
 1.16 “Par Generic Product” means a Generic Product that is manufactured or marketed under the Par ANDA. 
 1.17 “Paragraph IV Notice Letter” means a written notice including any “patent certification” filed in the United States under 21 U.S.C. §355(j)(2)(A)(vii)(IV). 

1.18 “Person” means any individual, partnership, association, corporation, limited liability company, trust,
governmental authority or other legal person or entity. 
 1.19 “Royalty Period” means, on a dosage
strength-by-dosage strength basis, the period beginning on the applicable Entry Date and ending when every claim in the Licensed Patents and the Covenant Patents, if any, has expired or been held unenforceable or invalid pursuant to a Final
Decision. 
 1.20 “Third Party” means a Person other than the Parties or any of their Affiliates. 

1.21 “Trademark” means the trademark SILENOR® 

  
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 2. DISMISSAL AND RELATED FILINGS 

2.1 Termination of Litigation. 
 (a) On or before the third (3rd) Business Day after the Execution Date, Plaintiffs and Defendants shall file with the District Court a stipulated consent judgment and joint motion to dismiss the Litigation, substantially in the
form attached as Exhibit A (the “Consent Judgment and Dismissal”), with each Party to bear its own fees and costs. 
 (b) The provisions of Sections 1 (to the extent necessary to interpret the other sections listed in this Section 2.1(b)), 2, 8, 9, and 12 of this Agreement shall become effective upon the Execution
Date, while the remaining provisions of this Agreement shall become effective upon the Effective Date. 
 2.2 FTC/DOJ
Filings. 
 (a) Within ten (10) days following the Execution Date, the Parties shall file with the U.S. Federal Trade
Commission, Bureau of Competition (“FTC”) and the Antitrust Division of the U.S. Department of Justice (“DOJ”) this Agreement and any notifications to be filed pursuant to Title XI of the Medicare Prescription Drug
Improvement and Modernization Act (Subtitle B — Federal Trade Commission Review) and any other applicable law. The Parties shall make additional timely filings as required by law. 

(b) The Parties shall use all commercially reasonable efforts to coordinate the foregoing filings and any responses thereto, to make
such filings promptly and in good faith and to respond promptly and in good faith to any requests for additional information made by either of such agencies, and to coordinate any necessary or desirable joint presentations. Each Party reserves the
right to communicate with the FTC or DOJ regarding such filings as it believes appropriate. Each Party shall keep the other Party reasonably informed of such communications and unless required by applicable law shall not disclose any confidential
information of the other Party without such other Party’s consent, which will not be unreasonably withheld or delayed. 
 3. RELEASE OF
CLAIMS 
 3.1 In settlement of the Litigation, and in consideration of the releases, representations, warranties and
covenants contained in this Agreement, as of the Effective Date, each Party and its respective parents, subsidiaries and Affiliates, on behalf of themselves and their respective predecessors, successors, administrators, attorneys, assigns, agents,
officers, employees, shareholders, directors, representatives and all other Persons claiming by, through and under them, do fully, finally and forever release, relinquish, acquit and discharge the other Party and each of its respective parents,
subsidiaries and Affiliates, on behalf of themselves and their respective predecessors, successors, administrators, attorneys, assigns, agents, officers, employees, shareholders, directors and representatives (collectively, the
“Releasees”), from any and all claims, demands, damages, liabilities, obligations, and causes of action accruing prior to the Effective Date (including costs, expenses and attorneys’ fees), that were or could have been filed in
the Litigation, whether known or unknown, to the extent arising out of, related to, or in connection with: (a) the Litigation, (b) the Par ANDA or its filing, or (c) the Par Generic Products. 

  
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 3.2 Each Party hereby expressly waives any and all provisions, rights and benefits conferred
by §1542 of the California Civil Code, or by any law of the United States or principle of common law that is similar, comparable or equivalent to §1542 of the California Civil Code, with respect to the matters released in this
Section 3. §1542 of the California Civil Code 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 TO HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR. 

3.3 Each Party represents, warrants and covenants that it has not, prior to the Effective Date, assigned or transferred, and will not
assign or otherwise transfer, to any Person any matters released by such Party as set forth in this Section 3 (except that the foregoing shall not prohibit an assignment of this Agreement pursuant to Section 12.3), and such Party agrees to
indemnify and hold harmless the other Party and its Releasees from and against all such released matters arising from any such alleged or actual assignment or transfer. 
 3.4 For the sake of clarity, this Section 3 shall not prevent or impair the right of a Party to bring a proceeding in court or any other forum for a breach of this Agreement or any representation,
warranty or covenant herein. 
 4. ADMISSIONS 
 4.1 Solely as related to the Par Generic Products subject to this Agreement and for no other purpose, Par, on behalf of itself and its Affiliates, acknowledges and agrees that all asserted claims of the
Licensed Patents: (a) would be infringed by the making, having made, use, offer for sale or sale in, or importation into, the Licensed Territory of Par Generic Products other than as permitted by this Agreement; and (b) are valid and
enforceable. 
 4.2 Par, on behalf of itself and its Affiliates, agrees not to, and to cause each of its Affiliates not to
(i) oppose or challenge the validity or enforceability of the Licensed Patents or the Covenant Patents, or aid or assist any third party in challenging, opposing or causing to be challenged, directly or indirectly, the validity or
enforceability of the Licensed Patents or the Covenant Patents in the United States Patent and Trademark Office; (ii) oppose or challenge the validity or enforceability of the Ex-US Manufacturing Patents in the patent office of the relevant
country or in any litigation pertaining to a 3 mg doxepin hydrochloride prescription product or a 6 mg doxepin hydrochloride prescription product, or aid or assist any third party in challenging, opposing or causing to be challenged, directly or
indirectly, the validity or enforceability of the Ex-US Manufacturing Patents in the patent office of the relevant country or in any litigation pertaining to a 3 mg doxepin hydrochloride prescription product or a 6 mg doxepin hydrochloride
prescription product; (iii) oppose or challenge the validity or enforceability of, or assert any other claim or defense in patent litigation concerning, the Licensed Patents or 

  
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Covenant Patents in any litigation pertaining to a 3 mg doxepin hydrochloride prescription product or a 6 mg doxepin hydrochloride prescription product, or (iv) aid or assist any third party
in challenging, opposing or causing to be challenged, directly or indirectly, the validity or enforceability of, or asserting any other claim or defense against the enforcement of, the Licensed Patents or Covenant Patents in any litigation
pertaining to a 3 mg doxepin hydrochloride prescription product or a 6 mg doxepin hydrochloride prescription product. For the avoidance of doubt, nothing in this Section 4.2 applies to any patent litigation pertaining to a doxepin hydrochloride
prescription product at a strength other than 3 mg and 6 mg, or an over-the-counter (“OTC”) version of a doxepin hydrochloride product. 
 4.3 Par hereby waives, on behalf of itself and its Affiliates, any and all invalidity and unenforceability defenses in any future litigation, arbitration or other proceeding with respect to the Licensed
Patents insofar as the defenses pertain to a 3 mg doxepin hydrochloride prescription product and a 6 mg doxepin hydrochloride prescription product. For the avoidance of doubt, nothing in this Section 4.3 applies to any litigation, arbitration
or other proceeding with respect to the Licensed Patents pertaining to a doxepin hydrochloride prescription product at a strength other than 3 mg and 6 mg, or an OTC version of a doxepin hydrochloride product, and nothing herein will prevent Par and
its Affiliates from responding to subpoenas from courts or administrative agencies. 
 5. LICENSE AND RELATED RIGHTS 

5.1 Par Commercialization Licenses. 
 (a) Effective as of the Entry Date, Somaxon grants to Par a royalty bearing, non-exclusive, non-transferable license under the Licensed Patents to make, have made, use, sell, offer for sale and import Par
Generic Products solely in the Field to its distributors and customers for ultimate resale by such distributors and customers to consumers solely for use in the Licensed Territory. Par shall include in its agreements with distributors or customers
language indicating that Par Generic Products are being provided to them solely for use in the Licensed Territory in the Field. However, Par shall have no duty to police the conduct of its customers. 

(b) Par shall have the right to grant a single sublicense to a single Par Affiliate (the “Named Affiliate”), solely for
the purposes of manufacturing Par Generic Products solely for import into the Licensed Territory, but shall have no other right to grant sublicenses. Par shall identify to Somaxon in writing the Named Affiliate to which it will grant a sublicense,
and the granting of such sublicense shall be subject to Somaxon’s approval, not to be unreasonably withheld, conditioned or delayed. Par may, upon six (6) months’ prior written notice, substitute a different Par Affiliate for the
Named Affiliate, subject to Somaxon’s approval, not to be unreasonably withheld, conditioned or delayed. It is the intention of the Parties that there is only a single Named Affiliate at one time. 

(c) Upon written request from Par delivered to Somaxon no more than one hundred and twenty (120) days before the Entry Date,
Somaxon shall provide to Par no more than sixty (60) days before the Entry Date (or within fifteen (15) days of delivery of Par’s request, whichever is later) written documentation that Par can file with the FDA to inform the FDA of
the license and Entry Date to facilitate final approval from the FDA of the Par ANDA. 

  
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 5.2 Covenants to Par. Solely in connection with making, using, selling, offering to
sell or importing the Par Generic Products in the Licensed Territory in the Field in accordance with this Agreement, Plaintiffs (and their respective Affiliates) will not sue, nor authorize, consent, join, support or encourage any Third Party to
sue, Par or the Named Affiliate, or its (or their) customers, suppliers, and distributors for infringement of the Covenant Patents. 

  
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 5.3 Covenant to Plaintiffs. 

(a) In return for Plaintiff’s grant of the license and other rights and covenants in Sections 5.1 and 5.2, Par, on behalf of itself
and its Affiliates, agrees not to make, have made, offer for sale, sell, market or import a Generic Product in or for the Licensed Territory prior to the Entry Date, except that Par may engage in the limited activity permitted under
Section 5.3(c). 
 (b) Par shall maintain the Par ANDA throughout the term of this Agreement. Except in accordance with
Section 12.3, Par shall not transfer or assign, or otherwise grant any Affiliate or Third Party any rights in, to or under the Par ANDA, and Par shall not assist any Affiliate or Third Party, directly or indirectly, to file or obtain an ANDA
for a Generic Product. 
 (c) Notwithstanding the foregoing, Par may engage in only the following pre-marketing activities:
(i) Par and the Named Affiliate may import and manufacture the Par Generic Products no more than *** in advance of the Entry Date; and (ii) Par and its Affiliates may engage in outreach to potential purchasers to inform them of the Par
Products in the Licensed Territory no more than *** in advance of Entry Date. In no event may Par and its Affiliates enter into binding contracts for purchases of the Par Generic Products in advance of the Entry Date. 

5.4 Acknowledgement. Par acknowledges that, notwithstanding the definition of the Entry Date, Par may not be able to legally
exploit the license and other rights granted pursuant to Sections 5.1 and 5.2 with respect to the Par Generic Products for various reasons outside of Plaintiffs’ control, including lack of regulatory approval for the Par ANDA by the FDA. Par
agrees that the Citizen Petition filed by Somaxon with the FDA on October 20, 2011 is deemed to be “outside of Plaintiff’s control” for purposes of this Section 5.4; however, any other petition, request, demand or similar
filing by or on behalf of Plaintiffs with any court, agency or administrative body relating to the Silenor Products insofar as such a filing affects FDA approval of Par Generic Products is not “outside of Plaintiff’s control” for
purposes of this Section 5.4. 
 5.5 Retained Rights. Except for the license and other rights granted pursuant to
this Agreement, all other rights to any intellectual property or regulatory exclusivities or approvals held by Plaintiffs or any of their Affiliates are hereby retained by Plaintiffs and their Affiliates. For the sake of clarity, this Agreement does
not grant to Par or its Affiliates any right to use any corporate names, logos or trademarks (including the Trademark) of any Plaintiff or any of their Affiliates inside or outside the Licensed Territory. 

6. ROYALTY PAYMENTS 
 6.1
With respect to each calendar quarter (or part thereof) during the Royalty Period, on a dosage strength-by-dosage strength basis, Par shall pay Somaxon a royalty of *** of Net Sales with respect to sales of Par Generic Products made during such
calendar quarter. Such payments shall be made within forty-five (45) days after the end of each calendar quarter of the Royalty Period. 
  

	***	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with
respect to the omitted portions. 

  
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 6.2 Payments; True-Up. 

(a) Within thirty (30) days after the end of each calendar quarter for which royalties are payable by Par under Section 6.1,
Par shall submit to Somaxon a report (the “Quarterly Report”), providing in reasonable detail an accounting of all Net Sales by Par and its Affiliates, including in each case, an accounting of all unit sales of the Par Generic
Products, a calculation of the deductions from gross invoice price to Net Sales made during such calendar quarter, the calculation of the applicable royalties under Section 6.1 and a detailed explanation and calculation of any Withholding Taxes
levied pursuant to Section 7.3. 
 (b) The Parties acknowledge that any deductions made in the calculation of Net Sales
under Section 1.13 of this Agreement may be based on accruals, which accruals will be compliant with Par’s or its Affiliate’s standard practices for all its pharmaceutical products, consistently applied for all its pharmaceutical
products, and in accordance with GAAP consistently applied; provided that such accruals shall be reconciled to actual amounts on a rolling basis as and when known relative to any accrued amount, and any difference between the actual results and the
accrual shall be reported and accounted for in the following calendar quarter(s). 
 (c) Within (1) year after the earlier
of the last Royalty Period or the termination or expiration of this Agreement, a final reconciliation shall be performed by Par (and a written report of such reconciliation shall be provided by Par to Somaxon) of the deductions made, pursuant to the
definition of Net Sales, and of the amounts payable; provided that such amounts must (a) be based upon reasonable assumptions and (b) be consistent with past accounting practices and in accordance with GAAP consistently applied. The
reconciliation shall be based on all actual amounts known as of that date versus prior accruals. Subject to Section 7.4, no further reconciliations shall be made. If any reconciliation between accruals and the actual results shows either an
underpayment or an overpayment, the Party having made the underpayment or received the overpayment shall pay the undisputed amount of the difference to the other within thirty (30) days after the date of delivery of the report of such
reconciliation. 
 7. PAYMENT TERMS 
 7.1 Any payments due pursuant to Sections 6.1 or 6.2(c) shall be made by wire transfer to an account specified by Plaintiffs in writing. 

7.2 Any amounts not paid when due under this Agreement shall be subject to interest at the rate of the lesser of one and one-half percent
(1.5%) per month or the highest rate permitted under law. 
 7.3 Par shall be responsible for, and may withhold from
payments made to Plaintiffs under this Agreement, any taxes required to be withheld by Par under applicable law. Accordingly, if any such taxes are levied on such payments due hereunder (“Withholding Taxes”), Par shall
(a) deduct the Withholding Taxes from the payment amount, (b) pay all applicable Withholding Taxes to the proper taxing authority, and (c) send evidence of the obligation together with proof of tax payment to Plaintiffs within sixty
(60) days following such tax payment. 

  
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 7.4 Par shall maintain its, and its Affiliates’, distributors’, marketing
partners’ and agents’ books and records with respect to the Net Revenues for a period of three (3) calendar years after the calendar year to which they relate. Plaintiffs shall have the right to audit such books and records on
reasonable advance notice to Par, no more than once per calendar year. If Par has underpaid any amounts hereunder, Par shall pay the relevant amount within thirty (30) days after receipt of the auditor’s report, along with interest as
described in Section 7.2. The audit shall be at Plaintiffs’ cost and expense, unless the underpayment exceeds five percent (5%) of the amount owed with respect to any calendar year, in which case Par shall promptly reimburse such
costs and expenses. 
 8. CONFIDENTIALITY 
 8.1 Each of the Parties shall keep the terms of the Agreement and the underlying settlement confidential, using at least the level of care it uses for its own proprietary information (but no less than
reasonable care), and shall not disclose to any Third Party (other than (a) such Party’s financial advisors, legal advisors, and insurers, and (b) parties and their counsel in litigation or anticipated litigation with Plaintiffs over
any of the Licensed Patents solely for purposes of disclosing, in connection with settlement negotiations, those provisions herein addressing the relevant Entry Date and/or royalty rate, in each such case subject to appropriate confidentiality
protections), except as provided below or as required by law (including disclosures required by the FTC and/or the DOJ). 
 8.2
No Party shall issue or make any public announcement, press release, or other public disclosure regarding this Agreement or the subject matter or terms of the settlement, except as required by law or the rules of a stock exchange on which the
securities of the disclosing Party are listed. In the event a Party is, in the opinion of its counsel, required to make a public disclosure by law or the rules of a stock exchange on which its securities are listed, such Party shall, if permitted by
law, submit the proposed disclosure in writing to the other Party a reasonable period prior to disclosure, and such Party shall provide any such comments promptly, but in any case within two (2) Business Days of its receipt of such disclosure.

 8.3 Notwithstanding Sections 8.1 and 8.2, Par may communicate with the FDA on a confidential basis prior to the applicable
Entry Date concerning the approval of the Par ANDA, and the licenses and waivers provided for herein. 
 8.4 Par acknowledges
that (a) Plaintiffs are currently engaged in ANDA-related patent litigations with various Third Parties concerning the Licensed Patents and may become engaged in future patent litigation concerning infringement of the Licensed Patents and
(b) such parties may request a copy of this Agreement in connection with discovery. Notwithstanding Sections 8.1 and 8.2, Par agrees to Plaintiff’s production of this Agreement under the highest level of confidentiality and protection
offered in the applicable protective order; provided that Plaintiffs give Par notice of any such discovery request no less than one (1) week in advance of making a disclosure under this Section. 

  
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 9. REPRESENTATIONS AND WARRANTIES 

9.1 Mutual Representations and Warranties. Each Party represents and warrants to the other Party that, as of the Execution Date:

 (a) it has the corporate power and authority to enter into this Agreement and to perform its obligations and bind its
Affiliates to perform their obligations hereunder, and that the person(s) executing this Agreement on behalf of such Party are authorized to do so; 
 (b) the execution and delivery of this Agreement and the performance of the transactions contemplated hereunder have been duly authorized by all necessary corporate actions of such Party and its
Affiliates; 
 (c) this Agreement has been duly executed and delivered by it and is a binding obligation of it, enforceable
against it and its Affiliates in accordance with its terms; and 
 (d) the execution and delivery of this Agreement and the
performance by such Party or its Affiliates of any of its obligations hereunder do not and will not conflict with (i) any judgment of any court or governmental body applicable to such Party or its Affiliates or its respective properties,
(ii) any other agreements to which it or its Affiliates may be a party, or (iii) to such Party’s knowledge, any statute, decree, order, rule or regulation of any court or governmental agency or body applicable to such Party, its
Affiliates or their respective properties. 
 9.2 Additional Plaintiff Representations and Warranties. Plaintiffs
represent and warrant to Par that they have the authority to grant rights under the Licensed Patents upon the terms set forth in this Agreement. 
 9.3 Disclaimer of Warranties. Except for those warranties set forth in Sections 3.3, 9.1 and 9.2, no Party makes any warranty, written, oral, express or implied, with respect to this Agreement. ALL
OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND NONINFRINGEMENT HEREBY ARE DISCLAIMED BY BOTH PARTIES. 
 10. INDEMNITIES. 
 10.1 Indemnity by Defendants. Defendants will,
jointly and severally, indemnify and hold harmless Plaintiffs, their respective Affiliates and their or their respective Affiliates’ officers, directors, employees and agents from and against any loss, damage, liability or expense in connection
with any and all actions, suits, claims, demands or prosecutions that may be brought or instituted against Plaintiffs or such other indemnitees by Third Parties (including governmental authorities) to the extent based on or relating to (a) any
breach by a Defendant of this Agreement; or (b) the manufacture, sale or offering to sell of any Par Generic Product, including any claim for personal injury, property damage, compensatory damages or punitive damages. 

  
 - 13 -

 10.2 Indemnity by Plaintiffs. Plaintiffs will, jointly and severally, indemnify and
hold harmless Defendants, their respective Affiliates and their or their respective Affiliates’ officers, directors, employees and agents from and against any loss, damage, liability or expense in connection with any and all actions, suits,
claims, demands, or prosecutions that may be brought or instituted against Defendants or such other indemnitees by Third Parties (including governmental authorities) to the extent based on or relating to (a) any breach by a Plaintiff of this
Agreement, or (b) the manufacture, sale or offering to sell of any Silenor Product, including any claim for personal injury, property damage, compensatory damages or punitive damages. 

10.3 Indemnification Procedures. A Person seeking indemnification under this Agreement shall provide prompt written notice to the
indemnifying Party (and, in any event, within five (5) Business Days) of the assertion of any claim against such Party as to which indemnity is to be requested hereunder; provided, however, that any delay or failure to provide
such notice shall not relieve the indemnifying Party of its indemnity obligations unless, and solely to the extent that, such delay or failure to notify materially prejudices the indemnifying Party’s ability to defend such claims. The
indemnifying Party shall have sole control over, and shall assume all expenses with respect to, the defense, settlement, adjustment or compromise of any claim as to which this Section 10 requires it to indemnify the other, provided that:
(a) the indemnified Person may, if it so desires, employ counsel at its own expense to participate and assist in the handling of such claim; and (b) the indemnifying Party shall obtain the prior written approval of the indemnified Person,
which shall not be unreasonably withheld, before entering into any settlement, adjustment or compromise of such claim or ceasing to defend against such claim if doing so would: (i) impose an injunction and/or any financial obligations upon the
indemnified Person; or (ii) result in an admission of wrongdoing by the indemnified Person. 
 11. BREACH OF THE AGREEMENT

 11.1 Each Party acknowledges and agrees that the restrictions and other terms and conditions set forth in this Agreement
regarding the manufacture, having manufactured, use, sale, offer for sale or importation of Par Generic Products by Par are reasonable and necessary to protect the respective legitimate interests of Plaintiffs, and that, in the event of a material
breach or threatened material breach of those restrictions or other terms or conditions of this Agreement by any Defendant, any Plaintiff shall have the right to seek from any court of competent jurisdiction injunctive relief, whether temporary,
preliminary, or permanent, or specific performance, which rights shall be cumulative and in addition to any other rights or remedies to which such Plaintiff may be entitled in law or equity. 

11.2 Either Party (which, for this purpose, means Plaintiffs or Defendants, as applicable, acting jointly) may terminate this Agreement
in the event of a material breach by another Party (which, for this purpose, means any Defendant, if Plaintiffs were to terminate, or any Plaintiff, if Defendants were to terminate), which breach remains uncured for a period of sixty (60) days
after notice thereof is given to such other Party; provided, however, that Plaintiffs may terminate this Agreement immediately on written notice if Par breaches Sections 4.2, 5.1(b), 5.3(a), 5.3(b) or 5.3(c). 

  
 - 14 -

 11.3 Nothing in this Agreement is intended, or shall be construed, to limit the
Parties’ rights to equitable relief or any other remedy for a breach of any provision of this Agreement. 
 12. GENERAL PROVISIONS

 12.1 Entire Agreement. This Agreement (which includes Exhibit A attached hereto) constitute the final,
complete and exclusive statement of the terms of the agreement among the Parties pertaining to the subject matter covered herein and therein and the settlement of the Litigation between the Parties and supersedes all prior and contemporaneous
understandings or agreements of the Parties. No Party has been induced to enter into this Agreement by, nor is any Party relying on, any representation or warranty outside those expressly set forth in this Agreement 

12.2 Governing Law and Dispute Resolution. 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. Any judicial proceedings related to disputes arising from or in connection with this Agreement shall be initiated exclusively in the District Court (or should there be no
subject matter jurisdiction, then in another court of competent jurisdiction in Delaware), which shall be deemed to be the appropriate forum to hear the dispute. 
 12.3 Assignment. No Party will assign this Agreement or any part hereof or any interest herein (whether by operation of law or otherwise) to any Person without the written approval of the other
Party; provided, however, that any Party may assign this Agreement without such consent (and, if Par so assigns this Agreement, it must assign the Par ANDA to the assignee of this Agreement) (a) to any Affiliate of such assigning
Party (for as long as such assignee remains an Affiliate of such Party); or (b) to any successor entity in the case of its merger, consolidation or change in control, or a sale of all or substantially all of its assets related to this
Agreement. No assignment will be valid unless the permitted assignee assumes all obligations of its assignor under this Agreement. No assignment will relieve any assigning Party of responsibility for the performance of its obligations hereunder. Any
purported assignment in violation of this Section 12.3 will be void. 
 12.4 Severability. Except as otherwise
expressly provided herein, if any provision of this Agreement or the application thereof will, to any extent, be held to be invalid or unenforceable, then (a) the remainder of this Agreement, or the application of such provision to provision of
this Agreement or the application thereof will, to any extent, be held to be invalid or unenforceable, then (a) the remainder of this Agreement, or the application of such provision to circumstances other than those as to which it is held
invalid or unenforceable, will not be affected thereby and each provision of this Agreement will be valid and enforceable to the fullest extent permitted by applicable law, and (b) the Parties covenant and agree to renegotiate any such
provision in good faith in order to provide a reasonably acceptable alternative to such provision, it being the intent of the Parties that the basic purposes of this Agreement are to be effectuated. 

12.5 Independent Contractors. No Party shall be deemed to be an agent, joint venturer or partner of the other. 

  
 - 15 -

 12.6 Amendments. No amendment, modification or supplement of any provisions of this
Agreement shall be valid or effective unless made in writing and signed by a duly authorized officer of each Party. 
 12.7
Waiver. None of the provisions of this Agreement will be considered waived by any Party unless such waiver is agreed to, in writing, by authorized agents of such Party. The failure of a Party to insist upon strict conformance to any of the
terms and conditions hereof, or failure or delay to exercise any rights provided herein or by law will not be deemed a waiver of any rights of any Party. 
 12.8 Counterparts and Facsimile Signatures. This Agreement may be executed simultaneously in several counterparts, each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument. Signatures provided by facsimile transmission or in AdobeTM Portable Document Format (PDF) sent by electronic mail shall be deemed to be original signatures. 

12.9 Construction. 
 (a) 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. 
 (b)
The word “including” or any variation thereof means “including without limitation” or any variation thereof and shall not be construed to limit any general statement which it follows to the specific or similar items or matters
immediately following it. 
 (c) The section headings contained in this Agreement are inserted for convenience only and shall
not affect in any way the meaning or interpretation of this Agreement. 
 12.10 Inurement. This Agreement shall be
binding upon and inure solely to the benefit of the Parties, their successors and permitted assigns, and nothing in this Agreement, express or implied, is intended to or shall confer upon any other Person(s) (other than the Releasees under
Section 3.1 and the indemnitees under Sections 10.1 and 10.2) any rights, benefits, or remedies of any nature whatsoever under or by reason of this Agreement. 
 12.11 Notices. Any notice required or permitted to be given or sent under this Agreement shall be in writing and hand delivered or sent by express delivery service or certified or registered mail,
postage prepaid, to the receiving Party at the addresses indicated below. 
  

			
	If to Plaintiffs, to:	  	Somaxon Pharmaceuticals, Inc.
		  	10935 Vista Sorrento Parkway, Suite 250
		  	San Diego, CA 92130
		  	Attn: General Counsel

  
 - 16 -

			
		
		  	And
		
		  	ProCom One, Inc.
		  	100 E. San Antonio, Ste 201
		  	San Marcos TX 78666
		  	Attn: President
		
	with copies to:	  	Wilmer Cutler Pickering Hale and Dorr LLP
		  	60 State Street
		  	Boston, MA 02109
		  	Attn: David Manspeizer
		
	If to Par, to:	  	Par Pharmaceutical Companies, Inc.
		  	300 Tice Boulevard
		  	Woodcliff Lake, NJ 07677
		  	Attn: General Counsel
		
	with copies to:	  	Arent Fox LLP
		  	1050 Connecticut Avenue NW
		  	Suite 600
		  	Washington, DC 20036
		  	Attn: Richard Berman

 Any such notice shall be deemed to be effective on delivery, if delivery is confirmed by the delivery service. A Party
may change its address by giving the other Parties written notice, delivered in accordance with this Section 12.11. 

SIGNATURES FOLLOW ON NEXT PAGE 

  
 - 17 -

 IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be executed by its duly authorized
representative as of the day and year first above written. 
  

					
	SOMAXON PHARMACEUTICALS, INC.	 		 	PAR PHARMACEUTICAL, INC.
			
	By: /s/ Richard W. Pascoe	 		 	By: /s/ Thomas J. Haughey
			
	Name: Richard W. Pascoe	 		 	Name: Thomas J. Haughey
			
	Title: President and CEO	 		 	Title: President
			
	PROCOM ONE, INC.	 		 	PAR PHARMACEUTICAL COMPANIES, INC.
			
	By: /s/ Terrell A. Cobb	 		 	By: /s/ Thomas J. Haughey
			
	Name: Terrell A. Cobb	 		 	Name: Thomas J. Haughey
			
	Title: President	 		 	Title: President

  
 18 

 EXHIBIT A 

IN THE UNITED STATES DISTRICT COURT 
 FOR THE DISTRICT OF DELAWARE 
  

					
	 	 	)	  	
	 SOMAXON PHARMACEUTICALS, INC.
 and PROCOM ONE, INC.,
	 	)	  	
	 	)	  	
		 	)	  	
	 Plaintiffs,
	 	)	  	No. 10-cv-1100 (RGA) (MPT)
		 	)	  	(Consolidated)
	 v.
	 	)	  	
		 	)	  	
	ACTAVIS ELIZABETH LLC, et al.,	 	)	  	
		 	)	  	
	 Defendants and
 Counterclaim-Plaintiffs.
	 	)	  	
	 	)	  	
	 	 	)	  	

 CONSENT JUDGMENT 
 The Court, upon the consent and request of Plaintiffs Somaxon Pharmaceuticals, Inc. and ProCom One, Inc. (collectively, “Plaintiffs”) and Defendants Par Pharmaceutical, Inc. and Par
Pharmaceutical Companies, Inc. (collectively “Par”), hereby Finds: 
 (1) Plaintiffs have charged Par with
infringement of U.S. Patent Nos. 6,211,229 (the “’229 patent”) and 7,915,307 (the “’307 patent”) in connection with Par’s submission to the U.S. Food and Drug Administration (“FDA”) of Abbreviated New
Drug Application (“ANDA”) No. 202-510 seeking approval to engage in the commercial manufacture, use, and/or sale of a 3 mg doxepin hydrochloride product and a 6 mg doxepin hydrochloride product (collectively, the “Par ANDA
Products”). 
 (2) Par has asserted certain affirmative defenses and counterclaims in the Litigation; 

(3) The Parties have agreed to resolve their disputes relating to the Litigation through a Settlement and License Agreement entered into
between the parties, dated June     , 2012 (the “Agreement”), in order to avoid further litigation and the attendant risk, associated fees, costs and expenses thereof; and 

(4) As a result of the Agreement there will be an opportunity for pro-competitive generic competition for doxepin hydrochloride products
for human use, which competition otherwise may not have existed until the expiration of the Licensed Patents and any applicable period of exclusivity; 

  
 19 

 ORDER 

Accordingly, upon the consent and request of the Parties, IT IS HEREBY ORDERED, ADJUDGED AND DECREED THAT:

 a) The parties’ claims, counterclaims, and defenses with respect to the ’229 and ’307 patents are hereby
dismissed without prejudice; 
 b) Par, its officers, agents, servants, employees and attorneys, and those persons in active
concert or participation with them who receive actual notice of this Order by personal service or otherwise, are hereby enjoined from manufacturing, using, offering to sell and selling within the United States, and importing into the United States,
the Par ANDA Products during the life of the ’229 and ’307 patents, including any extensions and pediatric exclusivities, except to the extent permitted by the Settlement and License Agreement dated July     ,
2012, and any subsidiary agreements entered into between the parties. 
 c) This Order shall finally resolve the Action between
the Parties, and the Parties each expressly waive any right to appeal or otherwise move for relief from this Order; 
 d) This
Court retains jurisdiction over the Parties for purposes of enforcing this Order; 
 e) Each Party shall bear its own fees and
costs in connection with the Action, including attorney fees; 

  
 20 

			
	[        ]	  	[        ]
		
	Attorneys for Plaintiffs Somaxon Pharmaceuticals, Inc. and ProCom One, Inc.	  	Attorneys for Defendants Par Pharmaceutical, Inc. and Par Pharmaceutical Companies, Inc.

 Dated: July     , 2012 
 SO ORDERED: 
 This      day of
            , 2012. 
  

	
	  

	 HON. [        ] 

	 UNITED STATES DISTRICT JUDGE

  
 21Settlement and License Agreement by and among Somaxon Pharmaceuticals

 Exhibit 10.4 
 CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT (INDICATED BY ASTERISKS) HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT. 
 SETTLEMENT AND LICENSE AGREEMENT 

This SETTLEMENT AND LICENSE AGREEMENT (this “Agreement”) is hereby entered into on July 18, 2012 (the “Execution
Date”) by and among Somaxon Pharmaceuticals, Inc., a corporation organized and existing under the laws of the State of Delaware (“Somaxon”), ProCom One, Inc., a corporation organized under the laws of the State of Texas
(“ProCom”), (Somaxon and ProCom are collectively “Plaintiffs”), Zydus Pharmaceuticals (USA), Inc., a corporation organized and existing under the laws of the State of New Jersey (“Zydus”), and
Cadila Healthcare Limited, a company organized and existing under the laws of India (“Cadila”) (Zydus and Cadila are collectively “Defendants”; each Plaintiff and each Defendant is a “Party”).

 RECITALS 
 WHEREAS, Somaxon is the holder of New Drug Application (“NDA”) No. 22-036 (the “Somaxon NDA”), which was approved by the United States Food and Drug Administration
(“FDA”) for the manufacture and sale of (a) an oral tablet containing as its sole active ingredient 3 mg doxepin hydrochloride, and (b) an oral tablet containing as its sole active ingredient 6 mg doxepin hydrochloride, in
each of cases (a)-(b), that is marketed and sold by Somaxon in the Licensed Territory (as defined below), under the trade name SILENOR® (the “Silenor Products”); 
 WHEREAS, the
formulation and dosing of the Silenor Products are covered by certain claims of the Licensed Patents (as defined below); 
 WHEREAS, ProCom owns
one of the Licensed Patents and Somaxon is the exclusive licensee of such Licensed Patent in the Licensed Territory, and Somaxon owns the other Licensed Patent; 
 WHEREAS, the Licensed Patents are listed in the Orange Book (as defined below) for each of the strengths of the Silenor Products approved by the FDA under the Somaxon NDA; 

WHEREAS, pursuant to 21 USC § 355(j) Zydus filed Abbreviated New Drug Application (“ANDA”) No. 202761 (the “Zydus
ANDA”) with respect to a 3 mg doxepin hydrochloride product and a 6 mg doxepin hydrochloride product, and such ANDA is currently pending before FDA; 
 WHEREAS, Plaintiffs initiated an action against Defendants in the United States District Court for the District of Delaware (the “District Court”) under 35 USC § 271(e)
alleging infringement of the Licensed Patents, in a case captioned Somaxon Pharmaceuticals, Inc. and ProCom One, Inc. v. Zydus Pharmaceuticals USA, Inc. and Cadila Healthcare Limited (d/b/a Zydus Cadila), Civil Action
No. 1:11-cv-00537-RGA (D. Del.) (the “Litigation”); 

 WHEREAS, Defendants have asserted certain affirmative defenses and counterclaims in the Litigation;

 WHEREAS, the Parties have agreed to resolve their disputes relating to the Litigation through this Agreement, in order to avoid further
litigation and the attendant risk, associated fees, costs and expenses thereof; 
 WHEREAS, this Agreement is the only agreement between the
Parties related to the settlement of the Litigation, and no Party has received any consideration from any other Party for its entry into this Agreement other than that which is described in this Agreement; and 

WHEREAS, as a result of this Agreement there will be an opportunity for pro-competitive generic competition for doxepin hydrochloride products for human
use, which competition otherwise may not have existed until the expiration of the Licensed Patents and any applicable period of exclusivity. 

NOW, THEREFORE, in consideration of the mutual agreements herein contained, the sufficiency and receipt of which are hereby acknowledged, the Parties
hereto, intending to be legally bound hereby, agree as follows: 
 1. DEFINITIONS 

1.1 “Affiliate” means, with respect to an entity, any other entity that controls, is controlled by, or is under common
control with such first entity, where “control” means (a) in the case of corporate entities, direct or indirect ownership of at least fifty percent (50%) of the stock or shares having the right to vote for the election of
directors, and (b) in the case of non-corporate entities, direct or indirect ownership of at least fifty percent (50%) of the equity interest with the power to direct the management and policies of such non-corporate entities. 

1.2 “Asserted Claims” means (i) with respect to an oral tablet containing 3 mg doxepin hydrochloride, claims nos.
1, 2, 3, 5, 6, 24, 25, 27, and 28 of the ‘229 patent and claims nos. 1, 2, 3, 5, 6, 7, 8, 9, 11, 12, 13, 14, 15, 16, 17, 20, 21, 22, 23 and 24 of the ‘307 patent, and (ii) with respect to an oral tablet containing 6 mg doxepin
hydrochloride, claims nos. 1, 2, 3, 5, 6, 24, 25, 27, and 28 of the ‘229 patent and claims nos. 1, 2, 4, 5, 6, 7, 8, 9, 10, 12, 13, 14, 15, 16, 18, 19, 21, 22, 23 and 24 of the ‘307 patent. 

1.3 “Business Day” means a day on which the banks in the State of Delaware are permitted to be open. 

1.4 “Commercial Sale Date” means, on a dosage strength-by-dosage strength basis, the date on which a doxepin
hydrochloride tablet product containing as its sole active ingredient either 3 mg or 6 mg doxepin hydrochloride is first commercially sold in the Licensed Territory by a Third Party (excluding (i) any Person acting in concert with or under
license from Zydus or its Affiliates or (ii) any Person purchasing the Zydus ANDA) pursuant to an ANDA referencing the Somaxon NDA under a license or covenant not to sue granted to such Third Party by Plaintiffs. 

 1.5 “Final Decision Date” means, on a dosage strength-by-dosage strength
basis, the date of a final decision of a federal court 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, holding each of the relevant Asserted
Claims unenforceable or invalid. 
 1.6 “Generic Equivalent” means, on a dosage strength-by-dosage strength
basis, a pharmaceutical product containing doxepin hydrochoride as its sole active ingredient that is AB-rated to the equivalent dosage strength Silenor Product and has received FDA approval for marketing in the Licensed Territory pursuant to an
ANDA referencing Somaxon’s NDA No. 22-036. 
 1.7 “Generic Product” means each of the following:
(a) a product containing as its sole active ingredient 3 mg doxepin hydrochloride, and (b) a product containing as its sole active ingredient 6 mg doxepin hydrochloride, in each of cases (a)-(b), that is a generic version of the
corresponding Silenor Product. 
 1.8 “License Date” means, on a dosage strength-by-dosage strength basis, the
earlier of: 
 (a) 180 days after the Commercial Sale Date; 

(b) 180 days after the Final Decision Date; or 
 (c) immediately upon the Commercial Sale Date or Final Decision Date, provided that (i) under 21 U.S.C. § 355 (j)(5)(D)(ii), all first applicants who have filed ANDAs referencing Somaxon’s
NDA No. 22-036 forfeit the 180-day exclusivity periods and (ii) Plaintiffs have not entered into an exclusive or semi-exclusive license with any first applicant that would contractually preclude Defendants’ manufacturing, having
manufactured, offering for sale, importing, marketing or selling the relevant dosage strength of the Zydus Generic Product upon the Commercial Sale Date or Final Decision Date. This clause (c) shall not apply in the event of an occurrence under
21 U.S.C. § 355 (j)(5)(D)(i)(III); 
 provided that the License Date shall be subject to modification pursuant to Section 9.1.

 1.9 “Licensed Patents” means: 
 (a) U.S. Patent No. 6,211,229 (together with all reissues, reexaminations and patent and regulatory extensions thereof, “the ‘229 patent”), and 

(b) U.S. Patent No. 7,915,307 (together with all reissues, reexaminations and patent and regulatory extensions thereof,
“the ‘307 patent”); 
 together with all continuations, continuations-in-part or divisionals of any of the aforementioned
patents. 
 1.10 “Licensed Territory” means the United States of America, and its territories, districts and
possessions, including the Commonwealth of Puerto Rico. 

 1.11 “Marketing Partner” means (a) a sublicensee (if permitted by
Plaintiffs) or (b) a Person from whom a Defendant or its Affiliate gets a payment based on sales or other dispositions of a Zydus Generic Product by such Person. 
 1.12 “Net Revenues” means, on a dosage strength-by-dosage strength basis, the sum of the gross amount invoiced for the sale or other disposition of the relevant Zydus Generic Product by
Defendants or any of their Affiliates or Marketing Partners in the Licensed Territory, less the following items to the extent applicable to such Zydus Generic Product: (a) one-time per customer stocking allowances, any and all slotting
allowances, inventory price adjustments or Medicaid discounts and any and all rebates, charge-backs, quantity and cash discounts, and other usual and customary rebates or discounts, in each case actually granted to customers or governmental or
regulatory authorities; (b) amounts refunded, repaid or credited by reason of rejections or returns of goods, (c) any sales, excise, turnover, inventory, value-added, and similar taxes and duties assessed on applicable sales to the extent
they are recorded in gross amount invoiced, and (d) transportation charges (including insurance costs) and handling charges to the extent they are invoiced and included in gross sales. Net Revenues will be determined in accordance with U.S.
Generally Accepted Accounting Principles applied in a manner consistent with Defendants’ or their relevant Affiliates’ or Marketing Partners’ customary practices. For the avoidance of doubt, sales of Zydus Generic Products between or
among Defendants and their Affiliates and Marketing Partners for resale shall not be included within Net Revenues; provided, however, that any subsequent sale of such Zydus Generic Products by Defendants or such Affiliates or Marketing
Partners to a Third Party in the Licensed Territory, or any other payment received by Defendants or its Affiliates or Marketing Partners from such Third Parties relating to the sale of Zydus Generic Products in the Licensed Territory, shall be
included within Net Revenues. 
 1.13 “Orange Book” means the publication titled “Approved Drug Products
with Therapeutic Equivalence Evaluations,” in electronic or hard copy form, maintained by the FDA, including all supplements thereto. 
 1.14 “Paragraph IV Notice Letter” means a written notice including any “patent certification” filed in the United States under 21 U.S.C. §355(j)(2)(A)(vi)(IV). 

1.15 “Person” means any individual, partnership, association, corporation, limited liability company, trust,
governmental authority or other legal person or entity. 
 1.16 “Pre-Marketing” means engaging in outreach to
potential purchasers to inform them that Defendants will be offering to sell and selling the Zydus Generic Product for distribution in the Licensed Territory on or after the License Date (including, for example, notification to customers regarding
the Zydus Generic Product and engaging customers in non-binding pricing or contracting activities). 

 1.17 “Royalty Period” means, on a dosage strength-by-dosage strength basis,
the period beginning on the applicable License Date and ending when every Asserted Claim which covers such dosage strength of the Zydus Generic Product has expired or been held unenforceable or invalid pursuant to a Final Decision. 

1.18 “Third Party” means a Person other than the Parties or any of their Affiliates. 

1.19 “Total Doxepin Sales” means, on a dosage strength-by-dosage strength basis, the total gross dollar sales of doxepin
hydrochloride tablets containing 3 mg or 6 mg (as applicable) doxepin hydrochloride active ingredient sold pursuant to an NDA or ANDA *** in or for the Licensed Territory, with the total gross dollar sales data determined from publicly available
information (such as data provided by IMS Health Incorporated, Fairfield, Connecticut (together with its Affiliates, “IMS”) or, if not so publicly available, then as reasonably determined by Plaintiffs). 

1.20 “Trademark” means the trademark SILENOR®. 
 1.21 ***. 

1.22 “Zydus Generic Product” means a Generic Product that is manufactured or marketed under the Zydus ANDA. 

1.23 ***. 
 2. DISMISSAL AND
RELATED FILINGS 
 2.1 Termination of Litigation. 

(a) On or before the third (3rd) Business Day after the Execution Date, Plaintiffs and Defendants shall file with the District Court a stipulated
consent judgment and joint motion to dismiss the Litigation, substantially in the form attached as Exhibit A (the “Judgment and Dismissal”), with each Party to bear its own fees and costs. 

(b) The date on which the Judgment and Dismissal is entered by the District Court shall be the “Effective Date”. The
provisions of Sections 1 (to the extent necessary to interpret the other sections listed in this Section 2.1(b)), 2, 10, 11 and 14 of this Agreement shall become effective upon the Execution Date, while the remaining provisions of this
Agreement shall become effective upon the Effective Date. 
 2.2 FTC/DOJ Filings. 

(a) Within ten (10) days following the Execution Date, the Parties shall file with the U.S. Federal Trade Commission, Bureau of
Competition (“FTC”) and the Antitrust Division of the U.S. Department of Justice (“DOJ”) this Agreement and any notifications to be filed pursuant to Title XI of the Medicare Prescription Drug Improvement and
Modernization Act (Subtitle B — Federal Trade Commission Review) and any other applicable law. The Parties shall make additional timely filings as required by law. 

  

	***	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with
respect to the omitted portions. 

 (b) The Parties shall use all commercially reasonable efforts to coordinate the foregoing
filings and any responses thereto, to make such filings promptly and in good faith and to respond promptly and in good faith to any requests for additional information made by either of such agencies, and to coordinate any necessary or desirable
joint presentations. Each Party reserves the right to communicate with the FTC or DOJ regarding such filings as it believes appropriate. Each Party shall keep the other Party reasonably informed of such communications and shall not disclose any
confidential information of the other Party without such other Party’s consent, which will not be unreasonably withheld or delayed. 

3. RELEASE OF CLAIMS 

3.1 In settlement of the Litigation, and in consideration of the releases, representations, warranties and covenants contained in this
Agreement, as of the Effective Date, each Party and its respective parents, subsidiaries and Affiliates, on behalf of themselves and their respective predecessors, successors, administrators, attorneys, assigns, agents, officers, employees,
shareholders, directors, representatives and all other Persons claiming by, through and under them, do fully, finally and forever release, relinquish, acquit and discharge each other Party and each of its respective parents, subsidiaries and
Affiliates, on behalf of themselves and their respective predecessors, successors, administrators, attorneys, assigns, agents, officers, employees, shareholders, directors and representatives (collectively, the “Releasees”), from
any and all claims, demands, damages, liabilities, obligations, and causes of action accruing prior to the Effective Date (including costs, expenses and attorneys’ fees), that were or could have been filed in the Litigation, whether known or
unknown, to the extent arising out of, related to, or in connection with: (a) the Litigation, (b) the Zydus ANDA or its filing, or (c) the Zydus Generic Products. 

3.2 Each Party hereby expressly waives any and all provisions, rights and benefits conferred by §1542 of the California Civil Code,
or by any law of the United States or principle of common law that is similar, comparable or equivalent to §1542 of the California Civil Code, with respect to the matters released in this Section 3. §1542 of the California Civil Code
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 TO HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR. 
 3.3 Each Party represents, warrants and covenants that it had not, prior to the Effective Date, assigned or transferred, and will not assign or otherwise transfer, to any Person any matters released by
such Party as set forth in this Section 3 (except that the foregoing shall not prohibit an assignment of this Agreement pursuant to Section 14.3), and such Party agrees to indemnify and hold harmless the other Party and its Releasees from
and against all such released matters arising from any such alleged or actual assignment or transfer. 

 3.4 For the sake of clarity, this Section 3 shall not prevent or impair the right of a
Party to bring a proceeding in court or any other forum for a breach of this Agreement or any representation, warranty or covenant herein. 

4. ADMISSIONS AND COVENANTS 
 4.1 Defendants, on behalf of themselves and their Affiliates, acknowledge and agree that the Asserted Claims relevant to each Zydus Generic Product: (a) would be infringed by the making, having made,
importation, use, offer for sale or sale in, or importation into, the Licensed Territory of such Zydus Generic Product other than as permitted by this Agreement; and (b) are valid and enforceable solely as to such Zydus Generic Product.

 4.2 Defendants, on behalf of themselves and their Affiliates, agree not to challenge the validity, enforceability or
patentability of any of the Licensed Patents or to seek reexamination of those patents in any court or administrative agency (including the United States Patent and Trademark Office) having jurisdiction to consider the issue. Defendants also agree,
on behalf of themselves and their Affiliates, not to intentionally assist others, whether directly or indirectly, in challenging the validity, enforceability or patentability of any of the Licensed Patents, or in seeking reexamination of such
patents, in any court or administrative agency having jurisdiction to consider the issue. Nothing herein will prevent Defendants and their Affiliates from responding to subpoenas from courts or administrative agencies or filing a “paragraph
IV” certification against the Licensed Patents to the extent they are listed in the Orange Book for a product other than the Silenor Products. 
 5. LICENSE AND RELATED RIGHTS 
 5.1 License. Plaintiffs hereby grant
to Defendants, effective on and from the applicable License Date, a non-exclusive, non-transferable (except in connection with an assignment of this Agreement pursuant to Section 14.3), royalty-bearing and non-sublicenseable license under the
Licensed Patents, to make, have made, import, offer for sale, market and sell the relevant Zydus Generic Product in the Licensed Territory to Defendants’ and their Affiliates’ distributors, wholesalers, pharmacies and other customers in
the Licensed Territory for ultimate resale (whether directly or indirectly through multiple levels of distribution) to consumers in the Licensed Territory. 
 5.2 Preparatory License. In addition, Plaintiffs hereby grant to Defendants, (a) effective on and from the date *** days prior to the applicable License Date (the “Manufacturing
Date”), a non-exclusive, non-transferable (except in connection with an assignment of this Agreement pursuant to Section 14.3), and non-sublicenseable license under the Licensed Patents, to make, have made and import the relevant Zydus
Generic Product in the Licensed Territory in preparation for sales on and after the License Date pursuant to Section 5.1, and (b) effective on and from the date *** days prior to the applicable License Date (the “Pre-Marketing
Date”), a non-exclusive, non-transferable (except in connection with an assignment of this Agreement pursuant to Section 14.3), and non-sublicenseable license under the Licensed Patents, to conduct Pre-Marketing in the Licensed
Territory in preparation for offers for sale and sales on and after the License Date pursuant to Section 5.1. 

  

	***	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with
respect to the omitted portions. 

 5.3 Covenant to Plaintiffs. In return for Plaintiffs’ grant of the license and
other rights in Sections 5.1 and 5.2, Defendants, on behalf of themselves and their Affiliates, agree not to (i) make or have made a Generic Product in the Licensed Territory prior to the applicable Manufacturing Date, (ii) import a
Generic Product into the Licensed Territory prior to the applicable Manufacturing Date, (iii) conduct Pre-Marketing (for such purpose, replacing Generic Product for Zydus Generic Product in the definition of “Pre-Marketing”) for a
Generic Product in the Licensed Territory prior to the applicable Pre-Marketing Date or (iv) market (other than as permitted in Section 5.2(b)), offer for sale or sell a Generic Product in the Licensed Territory prior to the applicable
License Date. 
 5.4 Acknowledgement. Defendants acknowledge that, notwithstanding the definition of the License Date,
Manufacturing Date and Pre-Marketing Date, Defendants may not be able to legally exploit the license and other rights granted pursuant to Sections 5.1 and 5.2 with respect to the Zydus Generic Products for various reasons, including exclusivity
granted by the FDA to Third Parties or lack of regulatory approval for the Zydus ANDA by the FDA. 
 5.5 No Restriction on
Right to Grant ***: Defendants acknowledge and agree that nothing herein shall restrict the ability of Plaintiffs to grant to a Third Party who has *** for a period of 180 days after first commercial sale ***. Plaintiffs shall inform Defendants
of the date *** in writing within thirty (30) days after entering into such license. 
 5.6 Retained Rights. Except
for the license and other rights granted pursuant to this Agreement, all other rights to any intellectual property or regulatory exclusivities or approvals held by Plaintiffs or any of their Affiliates are hereby retained by Plaintiff and their
Affiliates. For the sake of clarity, this Agreement does not grant to Defendants or their Affiliates any right to use any corporate names, logos or trademarks (including the Trademark) of any Plaintiff or any of their Affiliates inside or outside
the Licensed Territory. 
 6. *** 
 6.1 On a dosage strength-by-dosage strength basis, in the event that one or more Third Party(ies) *** and if Defendants ***, and if Plaintiffs ***, then: 

(a) Defendants shall, immediately upon *** until the applicable date specified in Section 5.1 or 5.2, and shall ***; and

 (b) Defendants shall pay to Somaxon as liquidated damages, and not as a penalty, for Net Revenues of the Zydus Generic
Products (on a dosage strength-by-dosage strength basis) in or for the Licensed Territory ***: 
 (i) If the *** is *** or more
for such ***, Defendants shall pay to Somaxon *** of Net Revenues of the relevant Zydus Generic Products in or for the Licensed Territory ***; 
 (ii) If the *** is *** or more but less than *** for such ***, Defendants shall pay to Somaxon *** of Net Revenues of the relevant Zydus Generic Products in or for the Licensed Territory ***; 

  

	***	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with
respect to the omitted portions. 

 (iii) If the *** is *** or more but less than *** for such ***, Defendants shall pay to
Somaxon *** of Net Revenues of the relevant Zydus Generic Products in or for the Licensed Territory ***; and 
 (iv) If the ***
is less than *** for such ***, Defendants shall pay to Somaxon *** of Net Revenues of the relevant Zydus Generic Products in or for the Licensed Territory ***. 
 6.2 Defendants shall pay the amounts set forth in Section 6.1(b) within thirty (30) days after the end of the applicable ***, and such payment (the “Liquidated Damages Payment”)
shall be accompanied by a report providing in reasonable detail an accounting of all Net Revenues of the relevant Zydus Generic Products, a calculation of the deductions from gross invoice price to such Net Revenues and the calculation of the
applicable royalties under Section 6.1(b). Notwithstanding the foregoing, in the event that a *** then (i) the ***, and (ii) Somaxon shall promptly ***. 
 6.3 The Parties understand and agree that the damages to Plaintiffs of a *** subsequent sales is uncertain and that the amounts set forth in Section 6.1(b) are a genuine estimate of the loss the
Parties believe would be suffered by Plaintiffs as a result of ***. 
 6.4 The foregoing is not a limitation of Plaintiffs’
right to obtain damages or any other remedy with respect to *** prior to the License Date under any circumstances other than a *** and/or ***. However, the remedies set forth in this Section 6 shall be the exclusive remedies of the Plaintiffs
with respect to any ***. Notwithstanding anything herein to the contrary, the Plaintiffs acknowledge and agree that any *** is not a violation of the Judgment and Dismissal and the Plaintiffs shall not bring any claim asserting a violation of the
Judgment and Dismissal (including, by way of example and not limitation, any claim for contempt with respect to the Judgment and Dismissal) based thereupon. 
 7. ROYALTY PAYMENTS 
 7.1 With respect to each calendar quarter (or part
thereof) during the Royalty Period, on a dosage strength-by-dosage strength basis, Zydus shall pay Somaxon a royalty of *** of Net Revenues of Zydus Generic Products made during such calendar quarter (or, if applicable, the portion thereof that
falls within the Royalty Period). 
 7.2 Within thirty (30) days after the end of each calendar quarter for which royalties
are payable by Zydus under Section 7.1, Zydus shall submit to Somaxon a report (the “Quarterly Report”), providing in reasonable detail an accounting of all Net Revenues by Zydus and its Affiliates, including in each case, an
accounting of all unit sales of the Zydus Generic Products, a calculation of the deductions from gross invoice price to Net Revenues made during such calendar quarter and the calculation of the applicable royalties under Section 7.1. Zydus
shall, at the time it submits the Quarterly Report, pay to Somaxon all amounts due under Section 7.1, as indicated in the applicable report. 

  

	***	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with
respect to the omitted portions. 

 8. PAYMENT TERMS 
 8.1 Any payments due pursuant to Sections 6 or 7 shall be made by wire transfer to an account specified by Plaintiffs in writing. 
 8.2 Defendants shall maintain its books and records with respect to Net Revenues, and will cause its Affiliates and Marketing Partners to maintain their books and records with respect to Net Revenues, for
a period of three (3) calendar years after the calendar year to which they relate. Plaintiffs, through a nationally-recognized firm of independent certified public accountants mutually and reasonably acceptable to the Parties, shall have the
right to audit such books and records on reasonable advance notice to Defendants, no more than once per calendar year. If Zydus has overpaid any amounts hereunder, the overpayment shall be credited against amount due hereunder. If Zydus has
underpaid any amounts hereunder, Zydus shall pay the relevant amount (net of any credits for overpayment) within thirty (30) days after receipt of the auditor’s report. The audit shall be at Plaintiffs’ cost and expense unless the
underpayment exceeds five percent (5%) of the amount owed with respect to any calendar year, in which case Zydus shall promptly reimburse such costs and expenses. 
 9. MOST FAVORED NATION 
 9.1 On a dosage strength-by-dosage strength basis,
in the event a Plaintiff or any of its Affiliates ***, then this Agreement shall be automatically amended to ***, and Plaintiffs shall inform Defendants of such *** in writing within thirty (30) days after ***. Defendants acknowledge, for
purposes of this Section 9.1, the provisions of Section 5.5. 
 9.2 On a dosage strength-by-dosage strength basis, in
the event a Plaintiff or any of its Affiliates ***, then Plaintiffs shall inform Defendants in writing of such *** within thirty (30) days after ***, and this Agreement shall be automatically amended to ***. 

  

	***	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with
respect to the omitted portions. 

 10. CONFIDENTIALITY 
 10.1 Each of the Parties shall keep the terms of the Agreement and the underlying settlement confidential, using at least the level of care it uses for its own proprietary information (but no less than
reasonable care), and shall not disclose to any Third Party (other than (a) such Party’s financial advisors, legal advisors, and insurers, and (b) parties and their counsel in litigation or anticipated litigation with Plaintiffs over
any of the Licensed Patents solely for purposes of disclosing, in connection with settlement negotiations, those provisions herein addressing the relevant License Date, royalty rates and liquidated damages provisions, in each such case subject to
appropriate confidentiality protections), except as provided below or as required by law (including disclosures required by the FTC and/or the DOJ). 
 10.2 No Party shall issue or make any public announcement, press release, or other public disclosure regarding this Agreement or the subject matter or terms of the settlement, except as required by law or
the rules of a stock exchange on which the securities of the disclosing Party are listed. In the event a Party is, in the opinion of its counsel, required to make a public disclosure by law or the rules of a stock exchange on which its securities
are listed, such Party shall, if permitted by law, submit the proposed disclosure in writing to the other Party a reasonable period prior to disclosure, and such Party shall provide any such comments promptly, but in any case within two
(2) Business Days of its receipt of such disclosure. 
 10.3 Notwithstanding Sections 10.1 and 10.2, Defendants may
communicate with (a) the FDA on a confidential basis prior to the applicable License Date concerning the approval of the Zydus ANDA, and the licenses and waivers provided for herein, and (b) its manufacturers on a confidential basis (using
at least the level of care it uses for its own proprietary information, but not less than reasonable care), prior to the applicable License Date to the extent necessary to enable such manufacturers to manufacture Zydus Generic Products in accordance
with the terms and conditions set forth in this Agreement. 
 10.4 Defendants acknowledge that (a) Plaintiffs are currently
engaged in ANDA-related patent litigations with various Third Parties concerning the Licensed Patents and may become engaged in future patent litigation concerning infringement of the Licensed Patents and (b) such parties may request a copy of
this Agreement in connection with discovery. Notwithstanding Sections 10.1 and 10.2, Defendants agree to Plaintiff’s production of this Agreement under the highest level of confidentiality and protection offered in the applicable protective
order; provided, that Plaintiffs give Defendants notice of any such discovery request no less than ten (10) days in advance of making a disclosure under this Section. 
 11. REPRESENTATIONS AND WARRANTIES 
 11.1 Mutual Representations and
Warranties. Each Party represents and warrants to the other Party that, as of the Execution Date: 
 (a) it has the
corporate power and authority to enter into this Agreement and to perform its obligations and bind its Affiliates to perform their obligations hereunder, and that the person(s) executing this Agreement on behalf of such Party are authorized to do
so; 

 (b) the execution and delivery of this Agreement and the performance of the transactions
contemplated hereunder have been duly authorized by all necessary corporate actions of such Party and its Affiliates; 
 (c)
this Agreement has been duly executed and delivered by it and is a binding obligation of it, enforceable against it and its Affiliates in accordance with its terms; and 
 (d) the execution and delivery of this Agreement and the performance by such Party or its Affiliates of any of its obligations hereunder do not and will not conflict with (i) any judgment of any
court or governmental body applicable to such Party or its Affiliates or its respective properties, (ii) any other agreements to which it or its Affiliates may be a party, or (iii) to such Party’s knowledge, any statute, decree,
order, rule or regulation of any court or governmental agency or body applicable to such Party, its Affiliates or their respective properties. 
 11.2 Additional Plaintiff Representations and Warranties. Plaintiffs represent and warrant to Defendants that they have the authority to grant rights under the Licensed Patents upon the terms set
forth in this Agreement. 
 11.3 Disclaimer of Warranties. Except for those warranties set forth in Sections 3.3, 11.1
and 11.2, no Party makes any warranty, written, oral, express or implied, with respect to this Agreement. ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND
NONINFRINGEMENT HEREBY ARE DISCLAIMED BY BOTH PARTIES. 
 12. INDEMNITIES. 

12.1 Indemnity by Defendants. Defendants will, jointly and severally, indemnify and hold harmless Plaintiffs, their respective
Affiliates and their or their respective Affiliates’ officers, directors, employees and agents from and against any loss, damage, liability or expense in connection with any and all actions, suits, claims, demands or prosecutions that may be
brought or instituted against Plaintiffs or such other indemnitees by Third Parties (including governmental authorities) to the extent based on or relating to (a) any breach by a Defendant of this Agreement; or (b) the manufacture, sale or
offering to sell of any Zydus Generic Product, including any claim for personal injury, property damage, compensatory damages or punitive damages, provided that such claim does not arise out of or relate to the labeling of such Zydus Generic Product
to the extent that, pursuant to applicable law, the label for such Zydus Generic Product must be the same as the label for the dosage-strength-equivalent Silenor Product. 
 12.2 Indemnity by Plaintiffs. Plaintiffs will, jointly and severally, indemnify and hold harmless Defendants, their respective Affiliates and their or their respective Affiliates’ officers,
directors, employees and agents from and against any loss, damage, liability or expense in connection with any and all actions, suits, claims, demands, or prosecutions that may be brought or instituted against Defendants or such other indemnitees by
Third Parties (including governmental authorities) to the extent based on or relating to any breach by a Plaintiff of this Agreement. 

 12.3 Indemnification Procedures. A Person seeking indemnification under this
Agreement shall provide prompt written notice to the indemnifying Party (and, in any event, within five (5) Business Days) of the assertion of any claim against such Party as to which indemnity is to be requested hereunder; provided,
however, that any delay or failure to provide such notice shall not relieve the indemnifying Party of its indemnity obligations unless, and solely to the extent that, such delay or failure to notify prejudices the indemnifying Party’s
ability to defend such claims. The indemnifying Party shall have sole control over, and shall assume all expenses with respect to, the defense, settlement, adjustment or compromise of any claim as to which this Section 12 requires it to
indemnify the other, provided that: (a) the indemnified Person may, if it so desires, employ counsel at its own expense to participate and assist in the handling of such claim; and (b) the indemnifying Party shall obtain the prior
written approval of the indemnified Person, which shall not be unreasonably withheld, before entering into any settlement, adjustment or compromise of such claim or ceasing to defend against such claim if doing so would: (i) impose an
injunction and/or any financial obligations upon the indemnified Person; or (ii) result in an admission of wrongdoing by the indemnified Person. 
 13. BREACH OF THE AGREEMENT 
 13.1 Each Party acknowledges and agrees that
the restrictions and other terms and conditions set forth in this Agreement are reasonable and necessary to protect the respective legitimate interests of the Parties, and that, in the event of a material breach or threatened material breach of
those restrictions or other terms or conditions of this Agreement by any Party, any other Party shall have the right to seek from any court of competent jurisdiction injunctive relief, whether temporary, preliminary, or permanent, or specific
performance, which rights shall be cumulative and in addition to any other rights or remedies to which such other Party may be entitled in law or equity. 
 13.2 Nothing in this Agreement is intended, or shall be construed, to limit the Parties’ rights to equitable relief or any other remedy for a breach of any provision of this Agreement. In the event
of any breach by a Party described in this Section 13, each other Party reserves, and each Party so acknowledge, the right to seek damages, including enhanced damages, and other remedies for patent infringement to the full extent of the law.

 13.3 Notwithstanding Sections 13.1 and 13.2, Plaintiffs hereby agree that their respective remedies in law and in equity
relating to a Zydus At Risk Launch and sales of the Zydus Generic Product during the Zydus At Risk Period shall be limited to those set forth in Section 6 hereof. 
 14. GENERAL PROVISIONS 
 14.1 Entire Agreement. This Agreement (which
includes Exhibit A attached hereto) constitute the final, complete and exclusive statement of the terms of the agreement among the Parties pertaining to the subject matter of this Agreement and supersedes all prior and contemporaneous
understandings or agreements of the Parties. No Party has been induced to enter into this Agreement by, nor is any Party relying on, any representation or warranty outside those expressly set forth in this Agreement 

 14.2 Governing Law and Dispute Resolution. 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. Any judicial proceedings related to disputes arising from or in connection with this Agreement shall be initiated
exclusively in the District Court (or should there be no subject matter jurisdiction, then in another court of competent jurisdiction in Delaware), which shall be deemed to be the appropriate forum to hear the dispute. 

14.3 Assignment. No Party will assign this Agreement or any part hereof or any interest herein (whether by operation of law or
otherwise) to any Person without the written approval of the other Party; provided, however, that any Party may assign this Agreement without such consent (and, if Defendants so assigns this Agreement, they must assign the Zydus ANDA
to the assignee of this Agreement, and Zydus shall not otherwise transfer or assign, or otherwise grant any Affiliate or Third Party any rights in, to or under the Zydus ANDA) (a) to any Affiliate of such assigning Party (for as long as such
assignee remains an Affiliate of such Party); or (b) to any successor entity in the case of its merger, consolidation or change in control, or a sale of all or substantially all of its assets related to this Agreement. No assignment will be
valid unless the permitted assignee assumes all obligations of its assignor under this Agreement. No assignment will relieve any assigning Party of responsibility for the performance of its obligations hereunder. Any purported assignment in
violation of this Section 14.3 will be void. 
 14.4 Severability. Except as otherwise expressly provided herein, if
any provision of this Agreement or the application thereof will, to any extent, be held to be invalid or unenforceable, then (a) the remainder of this Agreement, or the application of such provision to circumstances other than those as to which
it is held invalid or unenforceable, will not be affected thereby and each provision of this Agreement will be valid and enforceable to the fullest extent permitted by applicable law, and (b) the Parties covenant and agree to renegotiate any
such provision in good faith in order to provide a reasonably acceptable alternative to such provision, it being the intent of the Parties that the basic purposes of this Agreement are to be effectuated. 

14.5 Independent Contractors. No Party shall be deemed to be an agent, joint venturer or partner of the other. 

14.6 Amendments. No amendment, modification or supplement of any provisions of this Agreement shall be valid or effective unless
made in writing and signed by a duly authorized officer of each Party. 
 14.7 Waiver. None of the provisions of this
Agreement will be considered waived by any Party unless such waiver is agreed to, in writing, by authorized agents of such Party. The failure of a Party to insist upon strict conformance to any of the terms and conditions hereof, or failure or delay
to exercise any rights provided herein or by law will not be deemed a waiver of any rights of any Party. 
 14.8 Counterparts
and Facsimile Signatures. This Agreement may be executed simultaneously in several counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Signatures provided by facsimile
transmission or in AdobeTM Portable Document Format (PDF) sent by electronic mail shall be deemed to be original signatures. 

 14.9 Construction. 

(a) 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. 

(b) The word “including” or any variation thereof means “including without limitation” or any variation thereof and
shall not be construed to limit any general statement which it follows to the specific or similar items or matters immediately following it. 
 (c) The section headings contained in this Agreement are inserted for convenience only and shall not affect in any way the meaning or interpretation of this Agreement. 

14.10 Inurement. This Agreement shall be binding upon and inure solely to the benefit of the Parties, their successors and
permitted assigns, and nothing in this Agreement, express or implied, is intended to or shall confer upon any other Person(s) (other than the Releasees under Section 3.1 and the indemnitees under Sections 12.1 and 12.2) any rights, benefits, or
remedies of any nature whatsoever under or by reason of this Agreement. 
 14.11 Notices. Any notice required or
permitted to be given or sent under this Agreement shall be in writing and hand delivered or sent by express delivery service or certified or registered mail, postage prepaid, to the receiving Party at the addresses indicated below. 

 

			
	If to Plaintiffs, to:	  	Somaxon Pharmaceuticals, Inc.
		  	10935 Vista Sorrento Parkway, Suite 250
		  	San Diego, CA 92130
		  	Attn: General Counsel
		
		  	And
		
		  	ProCom One, Inc.
		  	100 E. San Antonio, Ste 201
		  	San Marcos TX 78666
		  	Attn: President
		
	with copies to:	  	Wilmer Cutler Pickering Hale and Dorr LLP
		  	60 State Street
		  	Boston, MA 02109
		  	Attn: David Manspeizer

			
	If to Defendants, to:	  	Zydus Pharmaceuticals (USA), Inc.
		  	73 Route 31 N.
		  	Pennington, NJ 08534
		  	Attn: Executive Vice President and Head Global Intellectual Property
		
	with copies to:	  	Locke Lord LLP
		  	111 South Wacker Drive
		  	Chicago, IL 60606
		  	Attn: Michael Gaertner

 Any such notice shall be deemed to be effective on delivery, if delivery is confirmed by the delivery service. A Party
may change its address by giving the other Parties written notice, delivered in accordance with this Section 14.11. 

SIGNATURES FOLLOW ON NEXT PAGE 

 IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be executed by its duly authorized
representative as of the day and year first above written. 
  

							
	SOMAXON PHARMACEUTICALS, INC.	 		 	ZYDUS PHARMACEUTICALS (USA), INC.
			
	By: /s/ Richard W. Pascoe	 		 	By: /s/ Brij Khera
			
	Name: Richard W. Pascoe	 		 	Name: Dr. Brij Khera
				
	Title: President and CEO	 		 	Title:	 	Executive Vice President and Chief Legal Officer
			
	PROCOM ONE, INC.	 		 	CADILA HEALTHCARE LIMITED
			
	By: /s/ Terrell A. Cobb	 		 	By: /s/ Pankaj Patel
			
	Name: Terrell A. Cobb	 		 	Name: Pankaj Patel
				
	Title: President	 		 	Title:	 	Chairman, Managing-Director

 EXHIBIT A 

IN THE UNITED STATES DISTRICT COURT 
 FOR THE DISTRICT OF DELAWARE 
  

					
	 SOMAXON PHARMACEUTICALS, INC., and
 PROCOM ONE, INC.,
	 	 )
 )
	  	
		 	)	  	
	 Plaintiff,
	 	)	  	
		 	)	  	
	 v.
	 	)	  	Civil Action No. 1:11-cv-00537-RGA
		 	)	  	
	ZYDUS PHARMACEUTICALS USA, INC., and	 	)	  	
	CADILA HEALTHCARE LIMITED (d/b/a	 	)	  	
	ZYDUS CADILA),	 	)	  	
			
	 Defendants.
	 		  	
	 	 		  	 

 STIPULATION AND [PROPOSED] ORDER OF DISMISSAL 

The Court, upon the consent and request of Plaintiffs Somaxon Pharmaceuticals, Inc. and ProCom One, Inc. (collectively, “Plaintiffs”) and
Defendants Zydus Pharmaceuticals (USA), Inc. and Cadila Healthcare Limited (collectively, “Defendants”), hereby acknowledges the following Stipulation and issues the following Order. 

STIPULATION 
 Plaintiffs have charged Defendants with infringement of U.S. Patent Nos. 6,211,229 (the “’229 patent”) and 7,915,307 (the “’307 patent”) in connection with Zydus
Pharmaceuticals (USA), Inc.’s submission to the U.S. Food and Drug Administration (“FDA”) of Abbreviated New Drug Application (“ANDA”) No. 202761 seeking approval to engage in the commercial manufacture, use, and/or
sale of a 3 mg doxepin hydrochloride product and a 6 mg doxepin hydrochloride product (collectively, the “Zydus ANDA Products”). 
 Defendants admit that the submission of ANDA No. 202761 to the FDA for the purpose of obtaining regulatory approval to engage in the commercial manufacture, use, and/or sale of the Zydus ANDA
Products within the United States before the expiration of the ’229 and ’307 patents was an act of infringement of the ’229 and ’307 patents under 35 U.S.C. § 271(e)(2)(A). 

Defendants admit that the commercial manufacture, use, offer for sale and/or sale of the Zydus ANDA Products within the United States,
and/or the importation of such products into the United States, before the expiration of the ’229 and ’307 patents, other than in accordance with a license or other authorization from Plaintiffs, would infringe such patents. 

 Defendants admit that the ’229 and ’307 patents are valid and enforceable

 The Parties agree that the remaining claims, counterclaims, and defenses in this action should be dismissed without
prejudice. 
 ORDER 
 Accordingly, pursuant to the above Stipulation, and upon the consent and request of the Parties, IT IS HEREBY ORDERED, ADJUDGED AND DECREED THAT: 

a) The parties’ claims, counterclaims, and defenses with respect to the ’229 and ’307 patents are hereby dismissed without
prejudice; 
 b) Defendants, their officers, agents, servants, employees and attorneys, and those persons in active concert or
participation with them who receive actual notice of this Order by personal service or otherwise, are hereby enjoined from manufacturing, using, offering to sell and selling within the United States, and importing into the United States, the Zydus
ANDA Products during the life of the ’229 and ’307 patents, including any extensions and pediatric exclusivities, absent a license or other authorization from Plaintiff, except to the extent permitted by the Settlement and License
Agreement, and any subsidiary agreements, entered into between the parties, dated July     , 2012. 
 c)
This Stipulation And Order shall finally resolve the Action between the Parties, and the Parties each expressly waive any right to appeal or otherwise move for relief from this Stipulation And Order; 

d) This Court retains jurisdiction over the Parties for purposes of enforcing this Stipulation and Order; 

e) Each Party shall bear its own fees and costs in connection with the Action, including attorney fees; 

 

					
	[        ]	  		  	[        ]
			
	Attorneys for Plaintiffs Somaxon Pharmaceuticals, Inc. and ProCom One, Inc.	  		  	Attorneys for Defendants Zydus Pharmaceuticals (USA), Inc. and Cadila Healthcare Limited
			
	Dated:                  , 2012	  		  	

 SO ORDERED: 
 This      day of                  , 2012. 

	
	  

	HON. [        ]
	UNITED STATES DISTRICT JUDGE

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