Document:

Asset Purchase Agreement

 EXHIBIT 10.4 
  
 CONFIDENTIAL TREATMENT REQUESTED 
  
 CONFIDENTIAL TREATMENT REQUESTED: INFORMATION FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED IS OMITTED AND IS NOTED WITH “[CONFIDENTIAL TREATMENT
REQUESTED].” AN UNREDACTED VERSION OF THIS DOCUMENT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 
  
 ASSET PURCHASE AGREEMENT 
  
 THIS ASSET PURCHASE AGREEMENT, dated as of June 25, 2002 (this “Agreement”), is made by and among Xcel Pharmaceuticals, Inc., a Delaware
corporation (“Buyer”), Novartis AG, a company organized under the laws of Switzerland (“AG”), and Novartis Pharmaceuticals Corporation, a Delaware corporation (“NPC” and together with AG, “Sellers”). Each of
AG and NPC may hereinafter be referred to individually as a “Seller.” 
  
 WHEREAS, Sellers sell Migranal (as defined herein) and DHE (as defined herein) commercially; and 
  
 WHEREAS, Sellers desire to sell to Buyer, and Buyer desires to purchase from Sellers, certain Purchased Assets (as defined herein) related to Migranal and
DHE within the Territory (as defined herein), all upon the terms and subject to the conditions hereinafter set forth. 
  
 NOW, THEREFORE, in consideration of the mutual covenants herein contained and for other good and valuable consideration, the receipt and adequacy of which
are hereby acknowledged, the parties hereto hereby agree as follows: 
  
 ARTICLE I DEFINITIONS 
  
 Section 1.1
Definitions. As used in this Agreement, the following terms have the meanings set forth below: 
  
 “AG” has the meaning set forth in the recitals. 
  
 “Affiliate” means, with respect to any Person, any other Person that directly or indirectly Controls, is Controlled by or is under common
Control with such first Person. A Person will be deemed to “Control” another Person if such first Person has the power to direct or cause the direction of such other Person, whether through ownership of securities, by contract or
otherwise. 
  
 “Assigned Contracts” means the agreements
listed on Schedule 1.1(a). 
  
 “Assumed Contractual
Obligations” means the contractual obligations under the agreements listed on Schedule 1.1(a), to the extent that such obligations relate to performance on or after the Closing Date. 
  
 “Assumed Liabilities” has the meaning set forth in Section 2.3(a).

  
 “Assumption Agreement” means an assumption agreement
to be executed by Buyer and Sellers at Closing, substantially in the form of Exhibit A. 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 “Bill of Sale” means a bill of sale and assignment to be delivered by Buyer and Sellers at Closing, substantially
in the form of Exhibit B. 
  
 “Bulk Transfer Law”
has the meaning set forth in Section 8.5. 
  
 “Business
Day” means any day other than a Saturday, Sunday or other day on which banks in the City of New York are permitted or required to close by law or regulation. 
  
 “Buyer” has the meaning set forth in the recitals. 
  
 “Buyer Indemnified Parties” has the meaning set forth in Section 12.2(a). 
  
 “[CONFIDENTIAL TREATMENT REQUESTED]” has the meaning set
forth in Section 9.9(c). 
  
 “[CONFIDENTIAL TREATMENT
REQUESTED]” has the meaning set forth in Section 9.9(c). 
  
 “cGMP” means current good manufacturing practices of the FDA and other appropriate agencies, as set forth in 21 C.F.R. Parts 210 and 211 and all applicable FDA rules, regulations, guides and guidances, as amended from time to time
and in effect during the term of this Agreement. 
  
 “Closing” and “Closing Date” will have the respective meanings given such terms in Section 4.1. 
  
 “Confidential Information” has the meaning set forth in Section 8.3(a). 
  
 “Contracts” means contracts, leases, indentures, agreements, purchase orders and all other legally binding
arrangements, whether in existence on the date hereof or subsequently entered into, including all amendments thereto. 
  
 “Customer Orders” has the meaning set forth in Section 2.2(a)(viii). 
  
 “DHE” means the pharmaceutical product currently marketed and sold in the Territory as DHE-45® (dihydroergotamine mesylate, USP) Injection under the
NDA. 
  
 “DHE API” means Dihydroergotamine API, the
active pharmaceutical ingredient for DHE. 
  
 “DHE Finished
Goods” means DHE packaged and ready for distribution and sale to end- users. 
  
 “[CONFIDENTIAL TREATMENT REQUESTED]” has the meaning set forth in Section 6.7(a). 
  
 “DHE NDC Number” means the national drug code number associated with DHE, number 0078-0041-01. 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 “Deductible Amount” has the meaning set forth in Section 12.2(b)(i). 
  
 “Dihydroergotamine” means dihydroergotamine, the structure of which
is set forth on Schedule 1.1(b). 
  
 “[CONFIDENTIAL
TREATMENT REQUESTED]” has the meaning set forth in Section 9.9(a) 
  
 “Disclosing Party” has the meaning set forth in Section 8.3(a). 
  
 “Domain Name” means the Internet domain name “www.migranal.com,” as well as all registrations, goodwill and rights thereto.

  
 “Encumbrance” means any mortgage, charge, lien,
security interest, easement, right of way, pledge or encumbrance of any nature whatsoever. 
  
 “Excluded Assets” has the meaning set forth in Section 2.2(b). 
  
 “Excluded Intellectual Property” means (i) Sellers’ Trademarks, (ii) Sellers’ Trade Dress, (iii) any intellectual property that does
not relate specifically and solely to the manufacturing, marketing, sale or distribution of Migranal and DHE in the Territory and (iv) any computer programs and software. 
  
 “Excluded Liabilities” has the meaning set forth in Section 2.3(b). 
  
 “Exhibits” means, collectively, the Exhibits referred to throughout
this Agreement. 
  
 “FDA” means the United States Food
and Drug Administration. 
  
 “Finished Goods” means the
Migranal Finished Goods and the DHE Finished Goods. 
  
 “Governmental Entity” means any court, administrative agency or commission or other governmental authority or instrumentality, whether domestic or foreign. 
  
 “Governmental Rule” means any law, judgment, order, decree, statute, ordinance, rule or regulation issued or
promulgated by any Governmental Entity. 
  
 “IND” means
the investigational new drug application No. [CONFIDENTIAL TREATMENT REQUESTED] filed with the FDA for Migranal. 
  
 “Indemnified Party” has the meaning set forth in Section 12.6(a). 
  
 “Indemnifying Party” has the meaning set forth in Section 12.6(a). 
  
 “Knowledge” of Sellers means the actual knowledge of the following
employees of NPC: CONFIDENTIAL TREATMENT REQUESTED]. 
  
 “Liabilities” means any and all debts, liabilities and obligations, whether accrued or fixed, absolute or contingent, matured or unmatured, or determined or determinable, including 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 those arising under any law, action or governmental order and those arising under any contract, agreement, arrangement, commitment or
undertaking, or otherwise. 
  
 “Losses” means,
collectively, any and all damages, losses, Taxes, Liabilities, claims, judgments, penalties, costs and expenses (including reasonable attorneys’ fees and litigation expenses). 
  
 “Manufacturing Documentation” means any and all of the following that are specific to and necessary for the
manufacture of Migranal or DHE: manufacturing process validation reports, manufacturing instructions, batch record templates, manufacturing standard operating procedures, specifications and test methods for the finished products, raw materials and
stability, standard operating procedures and specifications for packaging, manufacturing and packaging instructions, master formula, validation reports (analytical, packaging and cleaning), stability data and approved supplier lists. 
  
 “Material Adverse Effect” means an effect which is materially
adverse to the Purchased Assets taken as a whole, but will not include (i) any adverse effect due to changes in conditions generally affecting (A) the healthcare industry or (B) the United States economy as a whole, (ii) any change or adverse effect
caused by, or relating to, the announcement of this Agreement and the transactions contemplated by this Agreement or (iii) any adverse effect due to legal or regulatory changes. Notwithstanding the foregoing, a decline in revenues of Migranal or
DHE, in and of itself, will not constitute a Material Adverse Effect. 
  
 “Medicaid Rebates” means all state and federal Medicaid rebates and reimbursements related to Migranal and DHE. 
  
 “Migranal” means the pharmaceutical product currently marketed and sold in the Territory as Migranal® (dihydroergotamine mesylate, USP) Nasal Spray under the NDA. 
  
 “Migranal Finished Goods” means Migranal packaged and ready for
distribution and sale to end-users. 
  
 “Migranal NDC
Number” means the national drug code number associated with Migranal, number 0078-0245-98. 
  
 “NDC Numbers” means the DHE NDC Number and the Migranal NDC Number. 
  
 “NPC” has the meaning set forth in the recitals. 
  
 “New Drug Application” or “NDA” means, collectively, the new drug application no. [CONFIDENTIAL
TREATMENT REQUESTED], as filed with the FDA pursuant to 21 C.F.R., Part 314, and all supplements, amendments and revisions thereto, and the new drug application no. [CONFIDENTIAL TREATMENT REQUESTED], as filed with the FDA pursuant to 21
C.F.R., Part 314, and all supplements, amendments and revisions thereto. 
  
 “Non-Competition Period” has the meaning set forth in Section 6.7(a). 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 “Patent Assignment” means the assignment of the Patents to be executed at Closing by AG and Buyer, substantially
in the form attached hereto as Exhibit C. 
  
 “Patents” means all patents and patent applications, including reissues, divisions, continuations, continuations-in-part and extensions thereof and reexamination certificates therefor. 
  
 “Permitted Encumbrance” means (i) any Encumbrance disclosed on
Schedule 1.1(c), (ii) any Encumbrance for Taxes, assessments and other governmental charges that are not yet due and payable or that may thereafter be paid without penalty, or that are being contested in good faith by appropriate proceedings
or (iii) any imperfection of title or other Encumbrance that, individually or in the aggregate with other such imperfections and Encumbrances, would not have a Material Adverse Effect. 
  
 “Person” means any individual, corporation, partnership, limited liability company, joint venture, trust, business
association, organization, Governmental Entity or other entity. 
  
 “Product Intellectual Property” means all (i) Product Technology, (ii) Product Migranal Trademarks and Product DHE Trademarks, (iii) Product Migranal Trade Dress and Product DHE Trade Dress, in each case to the extent used by
Sellers solely and specifically in the manufacture, marketing, sale and distribution of Migranal and DHE in the Territory, but excluding (in all cases) Excluded Intellectual Property, (iv) the Patents listed in Schedule 2.2(a)(i) and (v) the
[CONFIDENTIAL TREATMENT REQUESTED] more specifically described in Schedule 1.1(d). 
  
 “Product Marketing Materials” means all sales training, marketing, and other promotional materials used solely and specifically with respect to
Migranal and DHE in the Territory as of the Closing Date to the extent such materials are readily within the possession of NPC. 
  
 “Product Medical Materials” means all of the following within NPC’s possession or control: (i) all adverse event reports relating to
Migranal or DHE or their respective generic equivalents in the Territory, including any official correspondence with the FDA, reports or other documents relating thereto, (ii) all data, information and files relating to adverse experiences relating
to Migranal or DHE in the Territory, and (iii) all medical responses relating to Migranal or DHE that are active in NPC’s NQuIRE database, and written, phone and personal contact inquiries relating to Migranal or DHE that are available from
NPC’s NQuIRE database. 
  
 “Product Technology”
means the manufacturing technology that is used by Sellers solely and specifically in the manufacture of Migranal or DHE for sale in the Territory, including but not limited to, specifications and test methods, manufacturing and packaging
instructions, master formula, validation reports (process, analytical methods and cleaning), stability data and analytical methods, but excluding any common industry practice, process or procedure used or usable in the manufacture of pharmaceutical
products. 
  
 “Product DHE Trademarks” means the U.S.
trademarks and registrations thereof listed on Schedule 5.10(c), and the goodwill of the business symbolized thereby. 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 “Product Migranal Trademarks” means the U.S. trademarks and registrations thereof listed on Schedule
5.10(b), and the goodwill of the business symbolized thereby. 
  
 “Product DHE Trade Dress” means the current trade dress of DHE, but excluding Sellers Trade Dress. 
  
 “Product Migranal Trade Dress” means the current trade dress of Migranal, but excluding Sellers Trade Dress. 
  
 “Purchase Price” has the meaning set forth in Section 3.1.

  
 “Purchased Assets” has the meaning set forth in
Section 2.2(a). 
  
 “Receiving Party” has the meaning
set forth in Section 8.3(a). 
  
 “Regulatory Approvals”
mean the following, in each case only as it relates solely and exclusively to Migranal and DHE in the Territory and is in existence and in the possession or control of Sellers, as of the Closing Date: the NDA and all regulatory files relating
thereto, including any and all (i) regulatory filings and supporting documents, clinical studies and tests; and (ii) records maintained under cGMP or other record keeping or reporting requirements of the FDA, the Environmental Protection Agency, the
Occupational Health and Safety Administration or any other Governmental Entities, including all investigational new drug applications, drug master files, FDA warning letters, FDA Notices of Adverse Finding Letters, FDA audit reports (including any
responses to such reports), DDMAC correspondence, all other correspondence and communications with Governmental Entities, adverse event files, periodic safety update reports, IND safety reports and complaint files and annual product quality reviews.

  
 “Schedules” means, collectively, the Schedules
referred to throughout this Agreement. 
  
 “Sellers” and
“Seller” have the meaning set forth in the recitals. 
  
 “Sellers Cap Amount” has the meaning set forth in Section 12.2(b)(ii). 
  
 “[CONFIDENTIAL TREATMENT REQUESTED]” has the meaning set forth in Section 9.9(b). 
  
 “[CONFIDENTIAL TREATMENT REQUESTED]” has the meaning set forth in Section 9.9(a). 
  
 “Sellers Indemnified Parties” has the meaning set forth in Section
12.3. 
  
 “Seller Indemnified Product Liability Claims”
has the meaning set forth in Section 12.2(b)(iii). 
  
 “Sellers Trade Dress” means the stripes, bands or other designs and coloring used on the front panel of the packaging of Migranal and DHE to the extent used on other product packaging of Sellers. 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 “Sellers Trademarks” means (i) the “Novartis AG” and “Novartis Pharmaceuticals Corporation”
names or any variations thereof, (ii) the names “Novartis,” “Ciba,” “Ciba-Geigy,” “Summit Pharmaceuticals,” “Sandoz” and all formatives and derivatives thereof, all composite marks including such
names or any such formatives or derivatives and any colorable imitation of any of the foregoing and (iii) all Trademarks, other than the Product DHE Trademarks, the Product Migranal Trademarks, the Domain Name and the Internet domain names listed on
Schedule 2.2(a)(x), currently used by Sellers in connection with the manufacture, marketing, sale and distribution of Migranal and DHE. 
  
 “Supply Agreement” means the Supply Agreement to be executed at Closing by NPC, Novartis Pharma AG and Buyer, substantially in the form attached
hereto as Exhibit D. 
  
 “Tax” means all Federal,
state, local and foreign taxes and assessments, including all interest, penalties and additions with respect thereto. 
  
 “Tax Return” means any report, return, election, notice, estimate, declaration, information statement and other forms and documents (including
all schedules, exhibits and other attachments thereto) relating to and filed or required to be filed with a taxing authority in connection with any Taxes (including estimated Taxes). 
  
 “Territory” means the United States of America and its territories, including Puerto Rico and the District of
Columbia. 
  
 “[CONFIDENTIAL TREATMENT
REQUESTED]” has the meaning set forth in Section 9.2(b). 
  
 “Third Party Claim” has the meaning set forth in Section 12.6(b). 
  
 “Trademark Assignment” means the assignment of the Product DHE Trademarks and the Product Migranal Trademarks to be executed at Closing by AG and Buyer, substantially in the form attached hereto as
Exhibit E. 
  
 “Trademarks” means all trademarks,
trade names, brand names, logotypes, symbols, service marks, Internet domain names and the goodwill of the business symbolized thereby, including registrations and applications for registrations thereof and all renewals, modifications and extensions
thereof. 
  
 Section 1.2 Interpretation. 
  
 (a) When used in this Agreement the words “include”,
“includes” and “including” will be deemed to be followed by the words “without limitation.” 
  
 (b) Any terms defined in the singular will have a comparable meaning when used in the plural, and vice-versa. 
  
 (c) All references to recitals, Articles, Sections, Exhibits, Schedules and
Appendices will be deemed references to recitals, Articles, Sections, Exhibits, Schedules and Appendices to this Agreement. 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 (d) This Agreement will be deemed drafted jointly by all the parties hereto and will not be specifically construed against
any party hereto based on any claim that such party or its counsel drafted this Agreement. 
  
 Section 1.3 Currency. All currency amounts referred to in this Agreement are in U.S. Dollars unless otherwise specified. 
  

ARTICLE II SALE AND PURCHASE OF PURCHASED ASSETS 
  
 Section 2.1 Purchase and Sale. Upon the terms and subject to the conditions of this Agreement, on the Closing Date, Sellers will sell, assign,
transfer, convey and deliver to Buyer, and Buyer will purchase, acquire and accept, all right, title and interest, within the Territory, of Sellers in, to and under the Purchased Assets (as defined herein). 
  
 Section 2.2 Purchased Assets. 
  
 (a) The term “Purchased Assets” means the following properties,
assets and rights solely within the Territory of whatever kind and nature, tangible or intangible, other than the Excluded Assets (as defined herein), of Sellers existing on the Closing Date that relate solely and exclusively to Migranal and DHE,
including: 
  

	 	(i)	 	the Product Intellectual Property, including the Patents listed on Schedule 2.2(a)(i); 

  

	 	(ii)	 	the Regulatory Approvals; 

  

	 	(iii)	 	the existing lists of all current customers for Migranal and DHE and the pricing of Migranal and DHE for such customers; provided, however, that Sellers will retain
all rights of access and ownership of such information with respect to sales of other products of Sellers or its Affiliates; 

  

	 	(iv)	 	the Assigned Contracts; 

  

	 	(v)	 	the Product Marketing Materials; 

  

	 	(vi)	 	the Product Medical Materials; 

  

	 	(vii)	 	one copy of the Manufacturing Documentation; 

  

	 	(viii)	 	all unfilled customer orders for Finished Goods as of the Closing Date (a list of such orders to be provided to Buyer within ten (10) Business Days after the Closing)
(“Customer Orders”); 

  

	 	(ix)	 	the IND; 

  

	 	(x)	 	the Domain Name and the Internet domain names listed on Schedule 2.2(a)(x); and 

 CONFIDENTIAL TREATMENT REQUESTED 
  

	 	(xi)	 	the toll-free telephone number 1 -888-MY-RELIEF (1-888-697-3543). 

  
 (b) Sellers and Buyer expressly agree and acknowledge that the Purchased Assets will not include any of the following (the “Excluded Assets”):

  

	 	(i)	 	the Excluded Intellectual Property; 

  

	 	(ii)	 	any plant, tangible property (except as expressly included in the Purchased Assets above), equipment or employees related to the development, manufacture and commercialization of
Migranal and DHE or any active substance or raw materials; and 

  

	 	(iii)	 	the property, assets and rights listed on Schedule 2.2(b)(iii). 

  
 (c) Buyer acknowledges and agrees that Sellers may retain for archival purposes and for purposes of complying with the Supply Agreement one copy of all or
any part of the documentation that they deliver to Buyer hereunder. 
  
 Section 2.3 Assumption of Certain Liabilities and Obligations. 
  
 (a) Buyer will assume, be responsible for and pay, perform and discharge when due the following (collectively, the “Assumed Liabilities”): (i) any Liabilities arising from any product liability or patent or
trademark infringement claim or lawsuit first brought by any third party, the FDA or any other Governmental Entity on or after the Closing Date, but solely to the extent relating to the promotion or sale of Migranal or DHE in the Territory by or on
behalf of Buyer following the Closing; (ii) any Liabilities arising from any FDA or any other Governmental Entity action or notification first filed on or after the Closing Date, but solely to the extent relating to the promotion or sale of Migranal
or DHE in the Territory by or on behalf of Buyer following the Closing; (iii) the Assumed Contractual Obligations; (iv) any Liabilities that Buyer expressly assumes or agrees to assume under this Agreement; (v) any Liabilities arising under Customer
Orders; and (vi) except as otherwise provided in this Agreement, all other Liabilities that arise out of the development, manufacture, marketing, sale, distribution or use of Migranal or DHE in the Territory by or on behalf of Buyer (except to the
extent that either of the Sellers is obligated to indemnify the Buyer for any such Liabilities pursuant to the Supply Agreement) following the Closing. 
  
 (b) Except for the Assumed Liabilities, Buyer will not assume or be liable for any Liabilities arising in connection with Migranal, DHE or any other
Purchased Asset (collectively, the “Excluded Liabilities”). 
  
 Section 2.4 Proration. Sellers and Buyer agree to prorate as of the Closing Date any amounts under the Assigned Contracts which become due and payable after the Closing Date to the extent the benefit is attributable to the period
prior to the Closing Date, and any amounts under the Assigned Contracts which are paid prior to the Closing Date to the extent the benefit is attributable to the period subsequent to the Closing Date. 
  
 ARTICLE III PURCHASE PRICE 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 Section 3.1 Purchase Price. The purchase price for the Purchased Assets will be Forty-Seven Million Seven Hundred
Thousand Dollars ($47,700,000.00) in cash (the “Purchase Price”), payable in accordance with Section 4.2(b). 
  
 Section 3.2 Allocation of Purchase Price. The Purchase Price will be allocated among the Purchased Assets as of the Closing Date in accordance with
applicable law and as set forth in Exhibit F. Each of the parties hereto agrees to report (and to cause its Affiliates to report) the transactions contemplated by this Agreement in a manner consistent with applicable law and with the terms of
this Agreement, including the allocation provided in Exhibit F, and agrees not to take any position inconsistent therewith in any Tax Return, in any Tax refund claim, in any litigation or otherwise. 
  
 Section 3.3 Transfer Taxes. All transfer, sales, value added, stamp
duty and similar Taxes payable in connection with the transactions contemplated hereby, to the extent payable to Governmental Entities within the Territory, will be borne by Buyer. All transfer, sales, value added, stamp duty and similar Taxes
payable in connection with the transactions contemplated hereby, to the extent payable to Governmental Entities outside of the Territory, will be borne by Sellers. Notwithstanding the foregoing, each party shall be obligated for any Taxes to the
extent payable or assessed based upon the income or worth of such party. 
  
 ARTICLE IV THE CLOSING 
  
 Section 4.1 Closing
Date. The closing of the sale and transfer of the Purchased Assets (the “Closing”) will take place at the offices of Kaye Scholer LLP, 425 Park Avenue, New York, New York 10022 on June 25, 2002 or, if later, on the first Business Day
following the date on which all of the conditions to each party’s obligations under Article X have been satisfied or waived, or at such other time, date and place as will be mutually agreed to by the parties hereto (such date of the Closing
being hereinafter referred to as the “Closing Date”). 
  
 Section 4.2 Transactions to Be Effected at the Closing. At the Closing: 
  
 (a) Sellers will deliver or cause to be delivered to Buyer each of the items referred to in Section 10.2(d), in each case appropriately executed; and 
  
 (b) Buyer will deliver or cause to be delivered to Sellers (i) each of the items referred to in Section 10.3(c), in each
case appropriately executed, and (ii) payment of the Purchase Price by wire transfer in immediately available funds to an account or accounts designated in writing by Sellers at least two Business Days prior to the Closing Date. 
  
 ARTICLE V REPRESENTATIONS AND WARRANTIES OF SELLER 
  
 Sellers hereby represents and warrants to Buyer as follows: 
  
 Section 5.1 Sellers Organization; Good Standing. AG is a company
organized under the laws of Switzerland. NPC is a corporation, duly organized, validly existing and in good standing under the laws of the State of Delaware. Each Seller has the requisite power and authority to own the Purchased Assets and to carry
on its business as currently conducted. NPC is duly qualified to conduct business as a foreign corporation and is in good standing in each 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 jurisdiction where the nature of the business conducted by it makes such qualification necessary, except where the failure to so qualify or
be in good standing would not have a Material Adverse Effect. 
  
 Section 5.2 Authority; Execution and Delivery. Sellers have the requisite corporate power and authority to enter into this Agreement and to consummate the transactions contemplated hereby. The execution and delivery of this Agreement
by each Seller and the consummation of the transactions contemplated hereby have been duly and validly authorized. This Agreement has been duly executed and delivered by each Seller and, assuming the due authorization, execution and delivery of this
Agreement by Buyer, will constitute the legal, valid and binding obligation of each Seller, enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and other
similar laws affecting creditors’ rights generally from time to time in effect and to general principles of equity (including concepts of materiality, reasonableness, good faith and fair dealing) regardless of whether considered in a proceeding
in equity or at law. 
  
 Section 5.3 Consents; No Violation,
Etc. Except as set forth on Schedule 5.3, the execution and delivery of this Agreement do not, and the consummation of the transactions contemplated hereby and the compliance with the terms hereof will not (i) violate any Governmental
Rule applicable to Sellers, (ii) conflict with any provision of the certificate of incorporation or by-laws (or similar organizational document) of Sellers, (iii) conflict with any Contract set forth on Schedule 5.9, or (iv) require any
approval, authorization, consent, license, exemption, filing or registration with any court, arbitrator or Governmental Entity, except, with respect to the foregoing clauses (i) and (iii), for such violations or conflicts which would not have a
Material Adverse Effect or materially interfere with Sellers’ performance of its obligations hereunder or, with respect to the foregoing clause (iv), for such approvals, authorizations, consents, licenses, exemptions, filings or registrations
which have been obtained or made or which, if not obtained or made, would not have a Material Adverse Effect or materially interfere with Sellers performance of their obligations hereunder. 
  
 Section 5.4 Financial Information. NPC has made available to Buyer all
material financial information related to Migranal and DHE and the Purchased Assets reasonably requested by Buyer. Such financial information was derived from the books and records of NPC and was prepared by NPC in good faith and fairly presents, in
all material respects, in accordance with NPC’s accounting practices and procedures, financial information with respect to Migranal and DHE as of the dates and for the periods shown. 
  
 Section 5.5 Title to Purchased Assets. Except as set forth on Schedule 5.5, Sellers have good and valid title
to all of the Purchased Assets, as the case may be, free and clear of all Encumbrances other than Permitted Encumbrances. 
  
 Section 5.6 Litigation. Except as disclosed on Schedule 5.6, as of the date hereof, there is no suit, claim, action, investigation or
proceeding pending or, to the Knowledge of Sellers, threatened against NPC, that relates to the Purchased Assets which (i) if adversely determined would result in a Material Adverse Effect or (ii) challenges or seeks to prevent or enjoin the
transactions contemplated by this Agreement. 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 Section 5.7 Regulatory Issues. Except as set forth on Schedule 5.7, or as would not have a Material Adverse
Effect, during the year immediately prior to the date of this Agreement, with respect to Migranal and DHE only, NPC has not received or been subject to: (i) any FDA Form 483’s relating to Migranal or DHE; (ii) any FDA Notices of Adverse
Findings relating to Migranal or DHE; or (iii) any warning letters or other written correspondence from the FDA concerning Migranal or DHE in which the FDA asserted that the operations of NPC were not in compliance with applicable Governmental Rules
or guidelines with respect to Migranal and DHE. Except as would not have a Material Adverse Effect, during the year immediately prior to the date of this Agreement there has not been any occurrence of any product recall, market withdrawal or
replacement, or post-sale warning conducted by or on behalf of NPC concerning Migranal or DHE or any product recall, market withdrawal or replacement conducted by or on behalf of any entity as a result of any alleged defect in Migranal or DHE.

  
 Section 5.8 Compliance with Laws. Except as set forth
on Schedule 5.8, each Seller is in compliance in all material respects with all Governmental Rules applicable to it which relate primarily to the Purchased Assets, except where the failure to so comply would not have a Material Adverse
Effect. Except as set forth on Schedule 5.8, each Seller has not received any written notice within the past year of any asserted violation of any such Governmental Rules and each Seller has not received any written notice within the past
year that any investigation or review by any Governmental Entity with respect to the Purchased Assets is pending or that any such investigation or review is contemplated, except where the outcome of such investigation or review if adversely
determined would not have a Material Adverse Effect. 
  
 Section
5.9 No Defaults Under Contracts. 
  
 (a) Except as set
forth on Schedule 5.9, as of the date hereof each Seller is not bound by any material Contracts relating solely to Migranal and DHE and the Purchased Assets, including any material customer Contracts with respect to the sale and distribution
of Migranal and DHE in the Territory. 
  
 (b) Except as set forth
on Schedule 5.9 or as would not have a Material Adverse Effect, to the Knowledge of Sellers, the other parties to the Contracts listed on Schedule 5.9 are not in default under or in breach of such Contracts. Except as would not have a
Material Adverse Effect, each Seller has not received written notice that it is in default under or in breach of any Contract listed on Schedule 5.9. 
  
 Section 5.10 Intellectual Property Rights. 
  
 (a) Schedule 5.10 contains a true and correct list of all Patents and all Trademarks (other than Excluded Intellectual Property) owned by Sellers
and used by Sellers solely and specifically in the marketing, manufacture, use, importation, sale and distribution of Migranal or DHE in the Territory. 
  
 (b) Except as described in Schedule 5.10 or as would not have a Material Adverse Effect, all of the Patents and Trademarks listed on Schedule
5.10 as registered or filed have been duly registered or filed in the Territory, and all necessary registration, maintenance 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 and renewal fees with respect to such Patents and Trademarks have been paid, with the appropriate Governmental Entities. 
  
 (c) Except as described in Schedule 5.10 or as would not have a
Material Adverse Effect, to the Knowledge of Sellers, no third party is infringing or misappropriating in the Territory any of the Product Intellectual Property. 
  
 (d) Except as set forth on Schedules 5.8 and 5.10 or as would not have a Material Adverse Effect, to the
Knowledge of Sellers, there are no outstanding claims asserted in writing against Sellers alleging that Sellers’ development, manufacture or sale of Migranal or DHE in the Territory infringes or misappropriates any intellectual property of any
other Person. 
  
 Section 5.11 Sales Activity. During the
six (6) months immediately prior to the Closing, Sellers did not engage in any extraordinary activity or incentive programs or take any other extraordinary actions that increased purchases of units of DHE or Migranal by Sellers’ customers in
the Territory above the amounts that would have been purchased during such period by such customers based solely on normal market demand. 
  
 Section 5.12 No Brokers. Sellers have not entered into any agreement, arrangement or understanding with any Person or firm which will result in the
obligation to pay any finder’s fee, brokerage commission or similar payment in connection with the transactions contemplated hereby. 
  
 Section 5.13 Exclusive Representations and Warranties; Schedules. Other than the representations and warranties set forth in this Article V,
Sellers are not making any other representations or warranties, express or implied, with respect to Migranal or DHE or the Purchased Assets. The information included on any Schedule delivered to Buyer by Sellers will be deemed to have been delivered
with respect to all other Schedules delivered to Buyer by Sellers as though such information were fully set forth on such other Schedules. 
  
 ARTICLE VI CERTAIN COVENANTS AND AGREEMENTS OF SELLER 
  
 Section 6.1 Conduct of Business Until Closing. During the period from the date of this Agreement and continuing until the Closing, Sellers agree
(except as otherwise provided in this Agreement or to the extent that Buyer will otherwise consent in writing, which consent will not be unreasonably withheld) that: 
  
 (a) Ordinary Course. Sellers will conduct their respective businesses with respect to Migranal and DHE and the Purchased
Assets in substantially the same manner as presently conducted; provided, however, that nothing contained herein will be deemed to require the expenditures of any funds outside of the ordinary course of business. 
  
 (b) No Dispositions. Sellers will not sell, lease or transfer, or agree to
sell, lease or transfer, any of the Purchased Assets. 
  
 Section
6.2 Access. After the date hereof up to the Closing, Sellers will afford to quality control or quality assurance personnel or representatives of Buyer reasonable access to the offices, plants, properties, books and records of Sellers relating
to Migranal and DHE during 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 normal business hours, in order that Buyer may have an opportunity to make such reasonable inspections, investigations and audits as it
desires with respect to Migranal and DHE; provided, that Buyer will conduct such inspections, investigations and audits in a reasonable manner. 
  
 Section 6.3 Post-Closing Orders and Payments. From and after 12:01 A.M. (New York City time) on the day immediately following the Closing Date,
Sellers will promptly deliver to Buyer any purchase orders for Finished Goods received after the Closing and any payments received from third parties for Finished Goods purchased from Buyer after the Closing, and refer all inquiries it will receive
with respect to Migranal and DHE (other than with respect to Excluded Assets or Excluded Liabilities), to Buyer or its designee. 
  
 Section 6.4 [Reserved] 
  
 Section 6.5 Assistance with Buyer Regulatory Filings. 
  
 (a) Subject to the terms of the Supply Agreement, for the period of time commencing on the Closing Date and ending [CONFIDENTIAL TREATMENT
REQUESTED], Sellers will provide reasonable assistance to Buyer in its preparation and filing with the FDA of filings required to be filed by Buyer for the manufacture, marketing and distribution of Migranal or DHE in the Territory;
provided, however, that Buyer will reimburse Sellers for any and all out- of-pocket expenses incurred by Sellers in connection with any such assistance. It is understood and agreed that Buyer, as the owner of the product registration
for Migranal and DHE, will have the responsibility for all regulatory filings after the Closing Date. 
  
 (b) Sellers will use commercially reasonable efforts to make Sellers’ auditors available to Buyer, to make Sellers’ books and records available
to such auditors and to cause such auditors to reasonably cooperate with Buyer in connection with the preparation of any financial information and/or reports related to the Products that may be required to be included in any filings made by Buyer
with any Governmental Entities (including any filings with the SEC). 
  
 (c) Sellers’ obligations pursuant to this Section 6.5 will be limited to assistance with respect to matters and information that are not otherwise in the possession of Buyer. 
  
 Section 6.6 [Reserved] 
  
 Section 6.7 Noncompetition. 
  
 (a) For a period of [CONFIDENTIAL TREATMENT REQUESTED] following the
Closing Date (the “Non- Competition Period”), Sellers will not, without the prior written consent of Buyer, directly or indirectly, sell, market or distribute, anywhere in the Territory, [CONFIDENTIAL TREATMENT REQUESTED];
provided, however, that nothing herein will prevent each Seller or any of its Affiliates from [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 (b) The parties hereto agree and acknowledge that the provisions of this Section 6.7 will not be construed to limit or restrict in any manner the right of
each Seller or any of its Affiliate to develop, manufacture, use, sell or commercialize in any manner any pharmaceutical product other than [CONFIDENTIAL TREATMENT REQUESTED]. 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 (c) Nothing contained in this Section 6.7 will be construed as prohibiting each Seller or any of its Affiliates from: (a)
acquiring (whether by merger, asset or stock acquisition or otherwise) another company, business or line of products (including by license thereof or through investment therein), which makes, has made, sells, has sold, markets, has marketed,
distributes or has distributed or otherwise represents a [CONFIDENTIAL TREATMENT REQUESTED] and continuing to operate such company, business or line of products following such acquisition; or (b) entering into a joint venture, alliance or
other similar collaborative arrangement between each Seller or any of its Affiliates thereof and any third party which joint venture makes, has made, sells, has sold, markets, has marketed, distributes or has distributed a [CONFIDENTIAL TREATMENT
REQUESTED] and continuing to participate in such collaboration. 
  
 Section 6.8 Non-Assertion of Intellectual Property Rights. Except as to any Excluded Intellectual Property, Sellers agree that no Seller, nor any Affiliate of any Seller, will assert against Buyer (or any Person deriving rights
directly or indirectly from Buyer), under any patent, trade secret, copyright, trademark or other proprietary right owned or controlled by any Seller or any Affiliate of any Seller, a claim that Buyer’s (or such Person’s) development,
manufacture, use, marketing, sale or commercialization of DHE or Migranal in the Territory after the Closing (to the extent that such development, manufacture, use, marketing, sale or commercialization is performed in the same manner as performed by
or on behalf of Seller prior to the Closing) infringes any such patent, trade secret, copyright, trademark or other proprietary right of such Seller or Affiliate. By way of example only and not by way of limitation, the foregoing waiver shall not
apply to (i) rights, remedies or causes of action based on infringement arising or resulting, directly or indirectly, from any change in DHE or Migranal, or the manner in which it is developed, manufactured, used, marketed, sold or commercialized by
Buyer, its Affiliates or their respective successors or assigns, including without limitation, changes in the form or formulation, ampule, size, color or shape, packaging, labeling, Product Intellectual Property or Product Marketing Materials, or
(ii) the use by Buyer, its Affiliates or their respective successors or assigns of Sellers Trademarks or Sellers Trade Dress beyond the scope or duration of the limited right and license granted pursuant to Section 9.6. 
  
 Section 6.9 Websites. 
  
 (a) Buyer and Sellers hereby agree that, within twelve (12) months following
the Closing, Buyer shall provide one or more links from the Domain Name and, to the extent they are active, the Internet domain names listed on Schedule 2.2(a)(x) to one or more websites of Sellers to be identified by Sellers. Buyer and
Sellers agree to cooperate with each other in order to (a) establish all necessary links, (b) select the location on Buyer’s website where such links will be displayed and (c) maintain such links. Buyer shall not alter, vary or modify any such
link, in whole or in part, without the prior written approval of Sellers. 
  
 (b) For so long as Buyer will provide one or more links from the Domain Name to Sellers’ website pursuant to clause (a) above, Buyer shall maintain the Domain Name in a manner that permits linkage to
Sellers’ website(s). In addition, the Domain Name and Buyer’s website located thereat shall not contain, incorporate or display any material or content (including, but not limited to, text, graphics, multimedia content or images) that is
in any way (a) unlawful, harmful, defamatory, obscene, harassing, an invasion of the right of privacy; (b) 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 racially, ethically or otherwise objectionable or (c) otherwise inflammatory or offensive to Sellers. The Domain Name and Buyer’s
website located thereat shall not: (i) facilitate illegal activity, depict sexually explicit or pornographic images, promote violence, promote illegal discrimination based on race, sex, religion, nationality, disability, weight, height, marital
status, sexual orientation, or age; (ii) promote illegal activities; (iii) portray either Seller (or any of their respective Affiliates), or their respective products or services, in a false, misleading, derogatory, or otherwise offensive manner;
(iv) incorporate any materials which infringe, or assist others in infringing, any copyright, trademark or other intellectual property right; or (v) use any meta tags or any other “hidden text” utilizing a Seller’s name, trademark or
domain name without the express written consent of such Seller. Buyer shall use commercially reasonable efforts to avoid linking its website to any website that violates the restrictions set forth in this clause (b). 
  
 ARTICLE VII REPRESENTATIONS AND WARRANTIES OF BUYER 
  
 Buyer hereby represents and warrants to Sellers as follows: 
  
 Section 7.1 Buyer’s Organization; Good Standing. Buyer is a
corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. Buyer has all requisite corporate power and authority to carry on its business as it is currently being conducted. Buyer is duly qualified to
conduct business as a foreign corporation and is in good standing in every jurisdiction where the nature of the business conducted by it makes such qualification necessary, except where the failure to so qualify or be in good standing would not
prevent or materially delay the consummation of the transactions contemplated hereby. 
  
 Section 7.2 Authority; Execution and Delivery. Buyer has the requisite corporate power and authority to enter into this Agreement and to consummate the transactions contemplated hereby. The execution and
delivery of this Agreement by Buyer and the consummation of the transactions contemplated hereby have been duly and validly authorized. This Agreement has been duly executed and delivered by Buyer and, assuming the due authorization, execution and
delivery of this Agreement by Sellers, constitutes the legal, valid and binding obligation of Buyer, enforceable against Buyer in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer and other similar laws affecting creditors’ rights generally from time to time in effect and to general principles of equity (including concepts of materiality, reasonableness, good faith and fair dealing) regardless of whether
considered in a proceeding in equity or at law. 
  
 Section 7.3
Consents; No Violations, Etc. The execution and delivery of this Agreement do not, and the consummation of the transactions contemplated hereby and the compliance with the terms hereof will not (i) violate any Governmental Rule applicable to
Buyer, (ii) conflict with any provision of the certificate of incorporation or by-laws of Buyer, (iii) conflict with any material Contract to which Buyer is a party or by which it is otherwise bound or (iv) require any approval, authorization,
consent, license, exemption, filing or registration with any court, arbitrator or Governmental Entity, except with respect to the foregoing clauses (i) and (iii), for such violations or conflicts which would not materially interfere with
Buyer’s performance of its obligations hereunder or, with respect to the foregoing clause (iv), for such approvals, authorizations, consents, licenses, exemptions, filings or 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 registrations which have been obtained or made or which, if not obtained or made, would not materially interfere with Buyer’s
performance of its obligations hereunder. 
  
 Section 7.4
Litigation. As of the date hereof, there is no suit, claim, action, investigation or proceeding pending or, to the knowledge of Buyer, threatened against Buyer or any of its Affiliates which if adversely determined would delay the ability of
Buyer to perform its obligations hereunder. 
  
 Section 7.5 No
Brokers. Buyer has not entered into any agreement, arrangement or understanding with any Person or firm which will result in the obligation to pay any finder’s fee, brokerage commission or similar payment in connection with the transactions
contemplated hereby. 
  
 Section 7.6 Availability of Funds.
Buyer has cash available that is sufficient to enable it to make payment of the Purchase Price and any other amounts to be paid by it hereunder without the necessity of any third-party financing. 
  
 ARTICLE VIII 
 CERTAIN COVENANTS AND AGREEMENTS OF BUYER AND CONFIDENTIALITY 
 PROVISIONS

  
 Section 8.1 Insurance. At all times from the Closing
Date through that date which is [CONFIDENTIAL TREATMENT REQUESTED] for Migranal, DHE or DHE API supplied to Buyer pursuant to the Supply Agreement, Buyer will maintain product liability insurance written on an occurrence reported form in an
amount of not less than [CONFIDENTIAL TREATMENT REQUESTED] per occurrence, [CONFIDENTIAL TREATMENT REQUESTED] annual aggregate. Buyer will provide Sellers with a certificate of insurance on the Closing Date as evidence of such
insurance and annually thereafter evidencing the renewal of such insurance. Buyer will promptly notify Sellers of any change in the terms of such insurance from those set forth in the most recent certificate of insurance provided to Seller pursuant
to this Section 8.1. 
  
 Section 8.2 Records. Buyer will
preserve all books and records (including financial information) included within the Purchased Assets for a period of at least five (5) years from the Closing Date and make such books and records available for inspection and copying by each Seller
or its agents upon reasonable request and upon reasonable notice. Thereafter, Buyer will not dispose of or destroy any of such books or records without giving thirty (30) days prior written notice to Sellers to permit Sellers to duplicate or take
possession of any such books and records. 
  
 Section 8.3
Confidentiality. 
  
 (a) Each party (a “Receiving
Party”) acknowledges that it may receive (or, as the result of one or more transfers contemplated hereby, it may be or become in possession of) Confidential Information (as hereinafter defined) of another party (a “Disclosing Party”)
in the performance of this Agreement or the Supply Agreement. Each Receiving Party shall use commercially reasonable efforts to safeguard and to hold the Confidential Information of a Disclosing Party in confidence, and shall limit disclosure of
such Confidential Information to 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 those employees and consultants of the Receiving Party and its Affiliates who are bound by obligations of confidentiality to the Receiving
Party consistent with the terms of this Section 8.3. A Receiving Party shall not, directly or indirectly, disclose, publish or use for the benefit of any other Person or itself, except in performing this Agreement or the Supply Agreement, any
Confidential Information of a Disclosing Party without first having obtained the Disclosing Party’s written consent to such disclosure or use. “Confidential Information” shall mean information which is confidential or proprietary to
the Disclosing Party and shall include, without limitation, know-how, scientific information, the terms of this Agreement, clinical data, efficacy and safety data, adverse event information, formulas, methods and processes, specifications, pricing
information (including discounts, rebates and other price adjustments) and other terms and conditions of sales, customer information, business plans and all other intellectual property; provided, however, that Confidential Information
shall not include the following: 
  

	 	(i)	 	information of a Disclosing Party that is known to a Receiving Party or its Affiliates prior to the time of disclosure to it, to the extent evidenced by written records or other
competent proof, unless a proprietary interest in such information is transferred to the Disclosing Party pursuant to this Agreement or the Supply Agreement; 

  

	 	(ii)	 	information that is independently developed by employees, agents or independent contractors of a Receiving Party or its Affiliates without reference to or reliance upon the
information furnished by the Disclosing Party, as evidenced by written records or other competent proof, unless a proprietary interest in such information is transferred to the Disclosing Party pursuant to this Agreement or the Supply Agreement;

  

	 	(iii)	 	information disclosed to a Receiving Party or its Affiliates by a third party that has a right to make such disclosure; or 

  

	 	(iv)	 	any other information that is or becomes part of the public domain through no fault or negligence of the Receiving Party. 

  
 A Receiving Party shall also be entitled to disclose any Confidential
Information of a Disclosing Party (x) if, in the opinion of the Receiving Party’s outside counsel or General Counsel, such public announcement or public statement is necessary to avoid committing a violation of law or of any rule or regulation
of any securities association, stock exchange or national securities quotation system on which the Receiving Party’s securities are, or are proposed to be, listed or trade (including, without limitation, to comply with SEC or NASDAQ disclosure
requirements) or by order of any applicable Governmental Entity, (y) as may be necessary or appropriate in connection with the enforcement of this Agreement or (z) as may be required in furtherance of a party’s obligations under this Agreement;
provided, that in any such event, the Receiving Party shall give advance notice to the Disclosing Party and use commercially reasonable efforts, wherever possible, to obtain confidential treatment of such information by the applicable
Governmental Entity or other recipient (and, in the case of clause 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 (x), the Disclosing Party shall be provided with a copy of the proposed disclosure in sufficient time to allow a reasonable opportunity to
comment thereon). 
  
 (b) The obligations set forth in this
Section 8.3 shall survive the termination or expiration of this Agreement for five (5) years. Nothing in this Section 8.3 shall be construed to create or imply any right or license under any patent, trademark, copyright or other intellectual
property right owned or controlled by a party or its Affiliates (except as may be expressly set forth elsewhere in this Agreement). 
  
 (c) The obligations of this Section 8.3 and Article X of the Supply Agreement shall supersede the Confidentiality Agreement, dated as of March 12, 2002,
by and between Buyer and NPC and shall govern any and all information disclosed by a Disclosing Party to a Receiving Party from and after the date hereof. 
  
 Section 8.4 Assumption of Regulatory Commitments. From and after the Closing Date, Buyer will assume control of, and responsibility for all costs,
obligations and Liabilities arising from or related to any commitments or obligations to any Governmental Entity involving Migranal and DHE. 
  
 Section 8.5 Bulk Transfer Laws. Buyer hereby waives compliance by Sellers with the provisions of any so-called “bulk transfer law” of any
jurisdiction in connection with the sale of the Purchased Assets to Buyer. Sellers will indemnify and hold harmless Buyer against any and all liabilities that may be asserted by third parties against Buyer as a result of noncompliance with any such
bulk transfer law. 
  
 Section 8.6 [Reserved] 

 
 Section 8.7 NO REPRESENTATIONS BY SELLER. BUYER ACKNOWLEDGES THAT
NO REPRESENTATIONS HAVE BEEN MADE OTHER THAN AS SPECIFICALLY SET FORTH IN THIS AGREEMENT. BUYER HEREBY WAIVES, TO THE EXTENT PERMITTED BY LAW, ANY AND ALL IMPLIED WARRANTIES. NO ORAL WARRANTIES, REPRESENTATIONS OR STATEMENTS WILL BE CONSIDERED A
PART HEREOF. 
  
 Section 8.8 Response to Medical Inquiries and
Products Complaints. After the Closing, Buyer will assume all responsibility for responding to any medical inquiries or complaints about Migranal and DHE in the Territory; provided, however, that during the term of the Supply
Agreement, Sellers will perform their obligations with respect to the investigation of complaints and other matters as set forth in the Supply Agreement. 
  
 Section 8.9 Representations to Customers. After the Closing, Buyer will not make any knowing false or misleading representations to customers or
others regarding Buyer, Sellers, Sellers’ Affiliates or the Products and will not make any representations, warranties or guarantees with respect to the specifications, features or capabilities of the Products that are not consistent with the
applicable current FDA approved labeling and package insert or other documentation accompanying or describing the Products. Buyer will not make any negative or disparaging statements about any product of each Seller or any of its Affiliates, except
that Buyer 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 may, in compliance with applicable law, aggressively market, sell and promote the Products or other products which compete with products of
Sellers and their respective Affiliates. 
  
 ARTICLE IX OTHER
COVENANTS AND AGREEMENTS 
  
 Section 9.1 Contracts.
Sellers will assign the Assigned Contracts to Buyer on the Closing Date and, except as otherwise set forth herein, thereafter Buyer will comply with and perform under all such Assigned Contracts. Buyer will assume all of Sellers’ obligations
under the Assumed Contractual Obligations as of the Closing Date, to the extent that such obligations relate to performance on or after the Closing Date, and, except as otherwise set forth herein, thereafter Buyer will comply with and perform under
all such Assumed Contractual Obligations. From and after the date hereof, Sellers agree that they will not, without the prior written consent of Buyer, take any action that would extend the term of any such Assumed Contractual Obligation or create
any additional obligation with respect thereto. Sellers further agree that, if requested by Buyer in writing and permitted under the applicable Assigned Contract without penalty to Sellers, Sellers shall terminate the rights and obligations of
Sellers with respect to Migranal and DHE under each Assigned Contract as soon as practicable after obtaining Buyer’s direction. 
  
 Section 9.2 Trade Returns, Medicaid Rebates, Chargebacks. 
  

(a) For the period from the Closing Date through and including [CONFIDENTIAL TREATMENT REQUESTED], Sellers will bear the cost of returns of any
Finished Goods which Sellers previously sold; provided, however, that such returns will be subject to the requirement that the Finished Goods being returned will have been returned in compliance with Sellers’ returned goods policy
or have been accepted by Sellers on or before [CONFIDENTIAL TREATMENT REQUESTED]. From and after [CONFIDENTIAL TREATMENT REQUESTED], Buyer will be responsible for all returns of Finished Goods, regardless of the date of sale or the
seller thereof. Each party will be responsible for processing returns of Finished Products during the periods for which such party bears the cost thereof in accordance with the foregoing. Neither Sellers nor Buyer will take any action to encourage
or delay the return of any Finished Goods. 
  
 (b) Sellers will
bear the cost of a portion of all Medicaid Rebates for Migranal and DHE bearing the NDC Numbers, such portion to equal [CONFIDENTIAL TREATMENT REQUESTED] of the aggregate amount of Medicaid Rebates billed by applicable Governmental Entities,
with respect to [CONFIDENTIAL TREATMENT REQUESTED]; provided, however, Buyer will bear the additional costs of any Medicaid Rebates for Migranal and DHE with respect to [CONFIDENTIAL TREATMENT REQUESTED] to the extent
such costs exceed [CONFIDENTIAL TREATMENT REQUESTED] for Migranal and DHE established by Buyer during [CONFIDENTIAL TREATMENT REQUESTED]. Buyer will bear [CONFIDENTIAL TREATMENT REQUESTED] for Migranal and DHE with respect to
[CONFIDENTIAL TREATMENT REQUESTED] and thereafter, regardless of the date of sale. For the avoidance of doubt, Sellers will be entitled to [CONFIDENTIAL TREATMENT REQUESTED] federal and state Medicaid refunds, credits and other
adjustments relating to the sale of Migranal and DHE dispensed at any time prior to [CONFIDENTIAL TREATMENT REQUESTED], and Buyer will be entitled to [CONFIDENTIAL TREATMENT  

 CONFIDENTIAL TREATMENT REQUESTED 
  
 REQUESTED] federal and state Medicaid refunds, credits and other adjustments relating to the sale of Migranal and DHE dispensed on or
after [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 (c)
Notwithstanding any other provision of this Agreement, following the Closing Date, Sellers will be responsible for the administration of the Medicaid Rebate process for any products which bear the NDC Numbers associated with Migranal and DHE as of
the date hereof and Buyer will be responsible for the administration of such process for any products which bear NDC Numbers established by Buyer in accordance with the Supply Agreement. Sellers, on the one hand, and Buyer, on the other hand, will
each furnish the other with any information necessary for each party’s performance of its administrative responsibilities pursuant to this Section 9.2(c) in the form reasonably requested by the other party, including, without limitation,
applicable pricing information. For so long as Sellers are responsible for the administration of the Medicaid Rebate process for Migranal and DHE, Buyer will provide Sellers with the necessary information within five (5) days of the close of each
calendar quarter in the form attached as Exhibit G. Any fines associated with incorrect or late information provided by Sellers or Buyer to the other party under this Section 9.2(c) will be reimbursed by Sellers or Buyer, as the case may be,
to the other party. 
  
 (d) To the extent the same shall relate to
a charge-back or other activity date (i.e., the date of sale from the wholesaler to the wholesaler’s customer) that is [CONFIDENTIAL TREATMENT REQUESTED], Sellers will be responsible for any payments, rebates, administrative fees or
chargebacks due under any state or federal program or due to customers under any private party managed care contracts or under any other contract or program of any nature whatsoever with private parties, regardless of the date of the sale of the
Products by the Sellers or Buyer. To the extent the same shall relate to a chargeback or other activity date that is [CONFIDENTIAL TREATMENT REQUESTED], Buyer will be responsible for any payments, rebates, administrative fees or chargebacks
due under any state or federal program or due to customers under any private party managed care contracts or under any other contract or program of any nature whatsoever with private parties, regardless of the date of the sale of the Products by the
Sellers or Buyer. 
  
 (e) Notwithstanding anything to the contrary
contained in this Section 9.2, Buyer will be responsible for any notices to the State of Texas with respect to any changes in the AWP (average wholesale price) or WAC (weighted average cost) following the Closing Date, in each such case as may be
required by applicable law. 
  
 Section 9.3 Adverse Experience
Reports. 
  
 (a) The definitions “adverse drug
experiences” and “serious” shall comply with the guidelines set forth by the FDA in the Code of Federal Regulations, Title 21 CFR 314.80(a) “Post marketing reporting of adverse drug experiences.” In order to properly execute
the duty of care, the following categories of reports shall also be treated as adverse events, even if they do not involve adverse symptomatology: overdose, drug abuse/misuse/maladministration, interactions, lack of efficacy, and exposure during
pregnancy. “Working Days” are defined as Monday through Friday exclusive of United States federal holidays. 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 (b) On or prior to the Closing Date, Sellers will provide Buyer with adverse experiences report for Migranal and DHE since
one year prior to the Closing Date. After the Closing Date, Sellers will submit to Buyer any or all historical adverse drug experience reports with the Products as requested by the Buyer. 
  
 (c) After the Closing Date, Buyer will submit to NPC all adverse drug experience reports for Migranal or DHE brought to the
attention of the Buyer, as well as any material events and matters concerning or affecting the safety of Migranal or DHE. To allow Sellers to comply with health authority regulations outside the Territory, Buyer agrees to forward copies of all
adverse experience reports to NPC within seven calendar days of receipt thereof by Buyer. After the Closing Date, Buyer will have all responsibility for investigating and reporting adverse experiences for Migranal and DHE to the FDA and addressing
any FDA inquiries related to the safety of Migranal or DHE. 
  
 (d) After the Closing Date, in order to allow the Buyer to comply with FDA regulations, Sellers agree to forward copies of all serious adverse experience reports outside the Territory to Buyer within two working days of receipt thereof by
AG. Sellers also will submit to Buyer any material events and matters concerning or affecting the safety of Migranal or DHE. Additionally, after the Closing Date, Sellers will assist Buyer with the provision of data relating to adverse experiences
for Migranal and DHE for the Buyer’s preparation of its first Periodic Safety Report for each Product. 
  
 (e) After the Closing Date, Sellers and Buyer will be responsible for health authority safety inquiries in their respective territory(ies). The parties
will provide each other with any information needed to respond to health authority safety requests in a complete and accurate manner. 
  
 Section 9.4 Transfer of NDA, Etc. For the period from the Closing Date through [CONFIDENTIAL TREATMENT REQUESTED], Sellers will cooperate
with Buyer in disclosing and copying any relevant records and reports which are required to be made, maintained and reported pursuant to Governmental Rules in the Territory. The parties hereto agree to use their reasonable efforts to take any other
actions required by the FDA to effect the transactions contemplated hereby. On the Closing Date, each of the parties hereto will take any actions necessary to effect the transfer of the NDA from NPC to Buyer, including notices to the FDA regarding
such transfer from NPC to Buyer of the NDA. Except as otherwise expressly provided for herein, all costs related thereto will be borne by Buyer. 
  
 Section 9.5 Further Action; Consents; Filings. 
  
 (a) Upon the terms and subject to the conditions hereof, each Seller and Buyer will use its reasonable best efforts to (i) take, or cause to be taken, all
actions necessary, proper or advisable under applicable Governmental Rules or otherwise to satisfy the conditions to Closing set forth in Article X and consummate and make effective the transactions contemplated by this Agreement, (ii) obtain from
the requisite Governmental Entities any consents, licenses, permits, waivers, approvals, authorizations or orders required to be obtained or made in connection with the authorization, execution and delivery of this Agreement and the consummation of
the transactions contemplated by this Agreement and (iii) make all necessary 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 filings, and thereafter make any other advisable submissions, with respect to this Agreement and the transactions contemplated by this
Agreement required under any applicable Governmental Rules. The parties hereto will cooperate with each other in connection with the making of all such filings, including by providing copies of all such non-confidential documents to the other party
hereto and its advisors prior to filing and, if requested, by accepting all reasonable additions, deletions or changes suggested in connection therewith. Each Seller and Buyer will furnish all information required for any application or other filing
to be made pursuant to the rules and regulations of any applicable Governmental Rules in connection with the transactions contemplated by this Agreement. 
  
 (b) Buyer agrees to cooperate and use it best efforts vigorously to contest and resist any action, including legislative, administrative or judicial
action, and to have vacated, lifted, reversed or overturned any decree, judgment, injunction or other order (whether temporary, preliminary or permanent) that is in effect and that restricts, prevents or prohibits the consummation of the
transactions contemplated by this Agreement, including by vigorously pursuing all available avenues of administrative and judicial appeal and all available legislative action. Notwithstanding any other provision of this Agreement to the contrary,
Buyer also agrees to take any and all actions as are or may be required by competent governmental authorities as a condition to the granting of any approvals required in order to permit the consummation of the transactions contemplated hereby or as
may be required to avoid, lift, vacate or reverse any legislative, administrative or judicial action which would otherwise cause any condition to Closing not to be satisfied. 
  
 Section 9.6 Transitional License. Effective as of the Closing, Sellers hereby grant to Buyer and its Affiliates and
each of their distributors the limited right and license to use the Sellers Trademarks and the Sellers Trade Dress which have been used in connection with the distribution, marketing, promotion and sale of Migranal and DHE consistent with
Sellers’ past practice, in connection with the distribution, marketing, promotion and sale of Migranal and DHE in the Territory. The limited right and license will include the right to use the Sellers Trademarks on Product Marketing Materials.
The limited right and license will be effective until the exhaustion of the product inventories purchased by Buyer pursuant to the Supply Agreement; provided, that Buyer will use reasonable commercial efforts to cease using the Sellers
Trademarks and the Sellers Trade Dress as soon as practicable after the Closing Date. Following such time period, neither Buyer nor its distributors will use, in any manner or for any purpose, directly or indirectly, the Sellers Trademarks or the
Sellers Trade Dress. All use of the Sellers Trademarks and the Sellers Trade Dress by Buyer, its Affiliates and its distributors will inure to the benefit of Sellers and will be in accordance with Sellers’ past practice for quality standards
for Migranal and DHE, the Product Marketing Materials and the Sellers Trade Dress. Buyer hereby acknowledges and agrees that no right, license or any transfer is granted by Sellers to Buyer by implication or otherwise with respect to the Sellers
Trademarks and the Sellers Trade Dress, except as provided in this Section 9.6. 
  
 Section 9.7 Notification of Certain Events. From and after the Closing Date, each Seller and Buyer will promptly notify the other party hereto, in writing if so requested by such other party, upon becoming
aware of any event or occurrence (including without limitation any pending or threatened claim, litigation or similar inquiry or action by any Person or the FDA) which could be reasonably expected to have an adverse effect on the development,
manufacture, 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 use, marketing, sale and distribution of Migranal or DHE in the Territory or the equivalent versions of Migranal or DHE marketed outside of
the Territory by or on behalf of each Seller and its Affiliates. 
  
 Section 9.8 Filing of [CONFIDENTIAL TREATMENT REQUESTED]. It is understood that, as of the Closing Date, NPC is in the process of preparing, for filing with the FDA, [CONFIDENTIAL TREATMENT REQUESTED] as required by
applicable governmental regulations. From and after the Closing Date, NPC will undertake to complete the preparation of the aforementioned filings and, once such filings are in a form as may be filed with the FDA, NPC will deliver such filings to
Buyer. 
  
 Section 9.9 Inventions. 
  
 (a) In the event that Buyer seeks to develop or commercialize in the
Territory [CONFIDENTIAL TREATMENT REQUESTED], Sellers shall, upon written request by Buyer, make available to Buyer solely in the Territory Sellers’ respective information, personnel, books and records, but only to the extent that the
foregoing relate to [CONFIDENTIAL TREATMENT REQUESTED]. With respect to all intellectual property rights associated with [CONFIDENTIAL TREATMENT REQUESTED], (i) as between Sellers and Buyer, Sellers shall [CONFIDENTIAL
TREATMENT REQUESTED], and (ii) subject to the rights of any third party, Sellers shall grant to Buyer a fully paid, royalty free, perpetual, exclusive license, with the right to sublicense, to use [CONFIDENTIAL TREATMENT REQUESTED] to
make, have made, sell, have sold, market, have marketed, distribute or have distributed any [CONFIDENTIAL TREATMENT REQUESTED]. Sellers shall also use commercially reasonable efforts to [CONFIDENTIAL TREATMENT REQUESTED]. 

 
 (b) In the event that, at any time prior to [CONFIDENTIAL TREATMENT
REQUESTED], either of the Sellers or any of their respective Affiliates [CONFIDENTIAL TREATMENT REQUESTED], then (i) as between Sellers and Buyer, Sellers shall [CONFIDENTIAL TREATMENT REQUESTED], and (ii) subject to the rights of
any third party, Sellers shall grant to Buyer a fully paid, royalty free, perpetual, exclusive license, with the right to sublicense, to use [CONFIDENTIAL TREATMENT REQUESTED] to make, have made, sell, have sold, market, have marketed,
distribute or have distributed any [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 (c) In the event that, at any time prior to [CONFIDENTIAL TREATMENT REQUESTED], the Buyer or any of its Affiliates [CONFIDENTIAL TREATMENT REQUESTED], then (i) as between Sellers and Buyer, Buyer shall
[CONFIDENTIAL TREATMENT REQUESTED] and (ii) subject to the rights of any third party, Buyer shall grant to Sellers a fully paid, royalty free, perpetual, exclusive license, with the right to sublicense, to use [CONFIDENTIAL TREATMENT
REQUESTED] to make, have made, sell, have sold, market, have marketed, distribute or have distributed any [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 (d) [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 ARTICLE X CONDITIONS PRECEDENT 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 Section 10.1 Conditions to Each Party’s Obligations. The obligation of Buyer to purchase the Purchased Assets
from Sellers and assume the Assumed Liabilities and the obligations of Sellers to sell, assign, convey and deliver the Purchased Assets to Buyer will be subject to the absence of any effective temporary restraining order, preliminary or permanent
injunction or other legal restraint or prohibition preventing the consummation of the transactions contemplated by this Agreement. 
  
 Section 10.2 Conditions to Obligations of Buyer. The obligation of Buyer to purchase the Purchased Assets from Sellers and assume the Assumed
Liabilities is subject to the satisfaction on and as of the Closing of each of the following conditions: 
  
 (a) Representations and Warranties. The representations and warranties of Sellers set forth in this Agreement will be true and correct as of the Closing
as though made on and as of the Closing, except (i) to the extent such representations and warranties relate to an earlier date (in which case such representations and warranties will be true and correct as of such earlier date) and (ii) for
breaches of representations and warranties as to matters that, individually or in the aggregate, would not have a Material Adverse Effect. 
  
 (b) Performance of Obligations of Seller. Each Seller will have performed or complied in all material respects with all obligations, conditions and
covenants required to be performed by it under this Agreement at or prior to the Closing. 
  
 (c) No Material Adverse Change. There will not be any event, change or occurrence after the date hereof which has a Material Adverse Effect. 
  
 (d) Deliveries. Each Seller will have executed and delivered to Buyer, as the case may be, (i) the Bill of Sale, (ii) the
Patent Assignment, (iii) the Trademark Assignment, (iv) documents required for the transfer of the NDA to Buyer and (v) the Supply Agreement. 
  
 Section 10.3 Conditions to the Obligations of Seller. The obligations of Sellers to sell, assign, convey, and deliver the Purchased Assets, or to
cause the Purchased Assets to be sold, assigned, conveyed or delivered, as applicable, to Buyer are subject to the satisfaction on and as of the Closing of each of the following conditions: 
  
 (a) Representations and Warranties. The representations and warranties of
Buyer set forth in this Agreement will be true and correct in all material respects as of the Closing as though made on and as of the Closing, except (i) to the extent such representations and warranties expressly relate to an earlier date (in which
case such representations and warranties will be true and correct as of such earlier date) and (ii) for breaches of representations and warranties as to matters that individually or in the aggregate would not materially interfere with Buyer’s
performance of its obligations hereunder. 
  
 (b) Performance of
Obligations of Buyer. Buyer will have performed in all material respects all obligations required to be performed by it under this Agreement at or prior to the Closing. 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 (c) Deliveries. Buyer will have executed and delivered to Sellers (i) the Assumption Agreement, (ii) the Bill of Sale, (iii)
the Supply Agreement and (iv) the certificate of insurance required by Section 8.1. 
  
 (d) Purchase Price. Buyer will have paid the Purchase Price. 
  
 ARTICLE XI TERMINATION, AMENDMENT AND WAIVER 
  
 Section 11.1 Termination. 
  
 (a) Notwithstanding anything to the contrary in this Agreement, this Agreement may be terminated and the transactions contemplated hereby abandoned at any time prior to the Closing: 
  

	 	(i)	 	by mutual written consent of Sellers, on the one hand, and Buyer, on the other hand; 

  

	 	(ii)	 	by either Seller if any of the conditions set forth in Section 10.1 or 10.3 will have become incapable of fulfillment and will not have been waived by both Sellers;

  

	 	(iii)	 	by Buyer if any of the conditions set forth in Section 10.1 or 10.2 will have become incapable of fulfillment and will not have been waived by Buyer; or 

  

	 	(iv)	 	by Sellers or Buyer if the Closing does not occur on or prior to July 12, 2002; 

  
 provided, however, that the party seeking termination pursuant to clause (ii), (iii) or (iv) is not in breach
in any material respect of any of its representations, warranties, covenants or agreements contained in this Agreement. 
  
 (b) In the event of termination by either Seller, on the one hand, or Buyer, on the other hand, pursuant to this Section 11.1, written notice thereof will
forthwith be given to the other party and the transactions contemplated by this Agreement will be terminated, without further action by any party. If the transactions contemplated by this Agreement are terminated as provided herein: 
  

	 	(i)	 	Buyer will return all documents and other material received from Sellers relating to Migranal and DHE and the Purchased Assets and to the transactions contemplated hereby, whether
so obtained before or after the execution hereof, to Sellers; and 

  

	 	(ii)	 	all confidential information received by Buyer with respect to Sellers, Migranal and DHE or the Purchased Assets will be treated in accordance with the Confidentiality Agreement,
which will remain in full force and effect notwithstanding the termination of this Agreement. 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 (c) If this Agreement is terminated and the transactions contemplated hereby are abandoned, this Agreement will become null
and void and of no further force and effect, except as otherwise provided in Section 11.1. Nothing in this Section 11.1 will be deemed to release any party from any liability for any breach by such party of the terms and provisions of this
Agreement. 
  
 Section 11.2 Amendments and Waivers. This
Agreement may not be amended except by an instrument in writing signed on behalf of each of the parties hereto. By an instrument in writing, Buyer, on the one hand, or Sellers, on the other hand, may waive compliance by the other party with any term
or provision of this Agreement that such other party was or is obligated to comply with or perform. 
  
 ARTICLE XII INDEMNIFICATION 
  
 Section 12.1 Survival. All representations and warranties of Sellers and Buyer contained herein or made pursuant hereto will survive the Closing Date for a period of [CONFIDENTIAL TREATMENT REQUESTED]
after the Closing Date. The covenants and agreements of the parties hereto contained in this Agreement will survive and remain in full force for the applicable periods described therein or, if no such period is specified, indefinitely. Any right of
indemnification pursuant to Article XII hereof with respect to a claimed breach of a representation, warranty or covenant will expire at the date of termination of the representation, warranty or covenant claimed to be breached, unless on or prior
to such date the party from whom indemnification is sought will have received notice of a good faith claim in accordance with the provisions of Section 12.6 hereof. The provisions of this Section 12.1 will survive for so long as any other Section of
this Agreement will survive. 
  
 Section 12.2 Indemnification
by Sellers. 
  
 (a) Sellers hereby agree to indemnify Buyer
and its Affiliates and their respective officers, directors and employees (the “Buyer Indemnified Parties”) against, and agrees to hold them harmless from, any Loss to the extent such Loss arises from or in connection with the following:

  

	 	(i)	 	any breach by either Seller of any representation or warranty made by it contained in this Agreement; 

  

	 	(ii)	 	any breach by either Seller of any of its covenants contained in this Agreement; or 

  

	 	(iii)	 	any Excluded Liability. 

  
 (b) Notwithstanding the foregoing, the indemnifications in favor of the Buyer Indemnified Parties contained in Section 12.2(a) above shall be subject to
the following limitations: 
  

	 	(i)	 	Except as provided in paragraphs (b)(ii) and (b)(iii) below, Sellers shall not be liable for indemnification under Section 12.2(a) until the aggregate dollar amount of all Losses
exceeds [CONFIDENTIAL  

 CONFIDENTIAL TREATMENT REQUESTED 
  
 TREATMENT REQUESTED] (the “Deductible Amount”), and then only to the extent such aggregate amount of
Losses exceeds the Deductible Amount, and Sellers’ obligation to indemnify the Buyer Indemnified Parties under Section 12.2(a) shall terminate once the aggregate dollar amount of all Losses claimed thereunder is equal to [CONFIDENTIAL
TREATMENT REQUESTED] and Sellers will thereafter have no further obligations or liabilities with respect to any such Losses; 
  

	 	(ii)	 	Sellers’ obligation to indemnify the Buyer Indemnified Parties under Section 12.2(a)(iii) above (other than with respect to Seller Indemnified Product Liability Claims (as
defined below)) and Section 12.2(a)(ii) above solely for any breach of Section 6.5 or Article IX of this Agreement shall (A) [CONFIDENTIAL TREATMENT REQUESTED] the Deductible Amount and (B) terminate once the aggregate dollar amount of all
Losses thereunder (including any Losses Buyer is indemnified for under the Supply Agreement) is equal to [CONFIDENTIAL TREATMENT REQUESTED] (the “Sellers Cap Amount”) and Sellers will thereafter have no further obligations or
liabilities with respect to any such Losses (or any such Losses under the Supply Agreement); and 

  

	 	(iii)	 	Sellers’ obligation to indemnify the Buyer Indemnified Parties for Losses under the following provisions [CONFIDENTIAL TREATMENT REQUESTED]: (A) Section 12.2(a)(ii)
above solely with respect to any breach of Section 6.7 or 6.8 or this Article XII (provided that any good faith dispute or objection with respect to a claim for indemnification under this Agreement shall not constitute a breach of this Article XII)
or (B) Section 12.2(a)(iii) above solely with respect to any Losses arising from any product liability claim or lawsuit related to Migranal or DHE and not assumed by the Buyer pursuant to clause (i) of Section 2.3(a) (“Seller Indemnified
Product Liability Claims”). 

  
 (c) Buyer
acknowledges and agrees that the indemnification provided in this Article XII and the indemnification provided in Article XI of the Supply Agreement will be the sole and exclusive remedy for all Losses related to or arising at law, under any statute
or in equity, or otherwise out of this Agreement or the Supply Agreement or the transactions contemplated hereby or thereby (other than claims of or causes of action arising from fraud) and, in furtherance thereof, Buyer waives, from and after the
Closing, to the fullest extent permitted under applicable law, any and all rights, claims, actions or causes of action (other than claims or causes of action arising from fraud) it may have against Seller or its Affiliates relating to the subject
matter of this Agreement or the Supply Agreement, other than the remedies provided in this Article XII or in Article XI of the Supply Agreement; provided, however, that Buyer shall be entitled to seek temporary or permanent injunctive
relief in order to enforce its rights under this Article XII or under Article XI of the Supply Agreement. Notwithstanding the foregoing, 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 nothing shall prohibit Buyer from seeking specific performance pursuant to Section 13.9 hereof or pursuant to Section 13.14 of the Supply
Agreement. 
  
 Section 12.3 Indemnification by Buyer. Buyer
hereby agrees to indemnify Sellers and their respective Affiliates and their respective officers, directors and employees (the “Sellers Indemnified Parties”) against, and agrees to hold them harmless from, any Loss to the extent such Loss
arises from or in connection with the following: 
  

	 	(i)	 	any breach by Buyer of any representation or warranty made by it contained in this Agreement; 

  

	 	(ii)	 	any breach by Buyer of any of its covenants contained in this Agreement; or 

  

	 	(iii)	 	any Assumed Liability. 

  
 Section 12.4 Losses Net of Insurance; Limitations. The amount of any Loss for which indemnification is provided under this Article XII will be net
of any amounts recovered or recoverable by the Indemnified Party under insurance policies with respect to such Loss. In no event will any party be liable to any other party, whether for breach of contract, in tort or otherwise, for incidental,
indirect, special or consequential damages, such as losses of revenues or profits. 
  
 Section 12.5 Termination of Indemnification. The obligations to indemnify and hold harmless any party (a) pursuant to Sections 12.2(a)(i), 12.2(a)(ii), 12.3(i) and 12.3(u) will terminate when the applicable
representation, warranty or covenant terminates, except as otherwise provided in Section 12.1, and (b) pursuant to the other clauses of Sections 12.2 and 12.3 will not terminate. 
  
 Section 12.6 Procedure. 
  
 (a) In order for an indemnified party under this Article XII (an “Indemnified Party”) to be entitled to any indemnification provided for under
this Agreement, such Indemnified Party will, promptly following the discovery of the matters giving rise to any Loss, notify the indemnifying party under this Article XII (the “Indemnifying Party”) in writing of its claim for
indemnification for such Loss, specifying in reasonable detail the nature of such Loss and the amount of the liability estimated to accrue therefrom; provided, however, that failure to give such prompt notification will not affect the
indemnification provided hereunder except to the extent the Indemnifying Party will have been actually prejudiced as a result of such failure (except that the Indemnifying Party will not be liable for any expenses incurred during the period in which
the Indemnified Party failed to give such notice). Thereafter, the Indemnified Party will deliver to the Indemnifying Party, within five Business Days after the Indemnified Party’s receipt of such request, all information and documentation
reasonably requested by the Indemnifying Party with respect to such Loss. 
  
 (b) If the indemnification sought pursuant hereto involves a claim made by a third party against the Indemnified Party (a “Third Party Claim”), the Indemnifying Party will be entitled to participate in the
defense of such Third Party Claim and, if it so chooses, to assume 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 the defense of such Third Party Claim with counsel selected by the Indemnifying Party. Should the Indemnifying Party so elect to assume the
defense of a Third Party Claim, the Indemnifying Party will not be liable to the Indemnified Party for any legal expenses subsequently incurred by the Indemnified Party in connection with the defense thereof. If the Indemnifying Party assumes such
defense, the Indemnified Party will have the right to participate in the defense thereof and to employ counsel, at its own expense, separate from the counsel employed by the Indemnifying Party, it being understood that the Indemnifying Party will
control such defense. The Indemnifying Party will be liable for the reasonable fees and expenses of counsel employed by the Indemnified Party for any period during which the Indemnifying Party has not assumed the defense thereof (other than during
any period in which the Indemnified Party will have failed to give notice of the Third Party Claim as provided above). If the Indemnifying Party chooses to defend or prosecute a Third Party Claim, all of the parties hereto will cooperate in the
defense or prosecution thereof. Such cooperation will include the retention and (upon the Indemnifying Party’s request) the provision to the Indemnifying Party of records and information which are reasonably relevant to such Third Party Claim,
and making employees available on a mutually convenient basis to provide additional information and explanation of any material provided hereunder. If the Indemnifying Party chooses to defend or prosecute any Third Party Claim, the Indemnifying
Party will not settle, compromise or discharge such Third Party Claim, to the extent that it involves any agreement, performance or observance by the Indemnified Party, without the Indemnified Party’s prior written consent (which shall not be
unreasonably withheld). Whether or not the Indemnifying Party will have assumed the defense of a Third Party Claim, the Indemnified Party will not admit any liability with respect to, or settle, compromise or discharge, such Third Party Claim
without the Indemnifying Party’s prior written consent (which shall not be unreasonably withheld). 
  
 ARTICLE XIII GENERAL PROVISIONS 
  
 Section 13.1 Expenses. Except as otherwise specified in this Agreement, all costs and expenses, including fees and disbursements of counsel, financial advisors and accountants, incurred in connection with this
Agreement and the transactions contemplated hereby will be paid by the party incurring such costs and expenses, whether or not the Closing will have occurred. Buyer will reimburse Sellers for the reasonable fees and expenses of Sellers’
auditors incurred in connection with Section 6.5(b) hereof. 
  
 Section 13.2 Further Assurances and Actions. Each of the parties hereto, upon the request of the other party hereto, whether before or after the Closing and without further consideration, will do, execute, acknowledge and deliver or
cause to be done, executed, acknowledged or delivered all such further acts, deeds, documents, assignments, transfers, conveyances, powers of attorney and assurances as may be reasonably necessary to effect complete consummation of the transactions
contemplated by this Agreement. Sellers and Buyer agree to execute and deliver such other documents, certificates, agreements and other writings and to take such other actions as may be reasonably necessary in order to consummate or implement
expeditiously the transactions contemplated by this Agreement. 
  
 Section 13.3 Notices. All notices, requests and other communications hereunder will be in writing and will be sent, delivered or mailed, addressed as follows: 

 CONFIDENTIAL TREATMENT REQUESTED 
  

	 	(a)	 	if to Buyer 

  
 Xcel Pharmaceuticals, Inc. 
 6363 Greenwich Drive, Suite 100 
 San Diego, California 92122 
 Telephone: 858-202-2721 
 Facsimile: 858-202-2799 
 Attn:    Michael T. Borer 
     President and Chief Executive Officer 
  
 with a copy to: 
  

David R. Snyder, Esq. 
 Pillsbury Winthrop LLP 
 11682 El Camino Real, Suite 200 
 San Diego, California 92130 
 Telephone: 619-234-5000 
 Facsimile: 619-236-1995 
  

	 	(b)	 	if to AG, to: 

  
 Novartis AG 
 St. Johann 
 Postfach 
 Lichstrasse 35 
 CH-4002 Basel, Switzerland 
 Telephone: 41 61 324 7225 
 Facsimile: 41 61 324 3671 
 Attn:    Peter Hewes 
  Head, Global Mature Products 
  Business Unit 
  
 with a copy to: 
  
 Novartis AG 
 St. Johann 
 Postfach 
 Lichstrasse 35 
 CH-4002 Basel, Switzerland 
 Telephone: 41 61 3242745 
 Facsimile: 41 61 3247826 
 Attn:    George L. Miller 
     Head of Legal

 CONFIDENTIAL TREATMENT REQUESTED 
  
 Tax, Legal, Insurance Management 
  

	 	(c)	 	Novartis Pharmaceuticals Corporation 

  
 59 Route 10 
 East Hanover, NJ 07936-1080 
 Telephone: (973) 781-5968 
 Facsimile: (973) 781-8891 
 Attn:    Joseph M. Farzetta 
  Head, Mature Products 
  
 with a copy to: 
  
 Novartis Pharmaceuticals Corporation 
 59 Route 10 
 East Hanover, NJ 07936-1080 
 Telephone: (973) 781-5230 
 Facsimile: (973) 781-5260 
 Attn:     General Counsel 
  
 Each such notice, request or other communication will be given (i) by hand delivery, (ii) by certified mail or (iii) by nationally recognized courier service. Each such notice, request or communication will be
effective when delivered at the address specified in this Section 13.3 (or in accordance with the latest unrevoked direction from the receiving party). 
  
 Section 13.4 Headings. The table of contents and headings contained in this Agreement are for reference purposes only and will not affect in any
way the meaning or interpretation of this Agreement. 
  
 Section
13.5 Severability. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced under any law or public policy, all other terms and provisions of this Agreement will nevertheless remain in full force and
effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any party. Upon such determination that any term or other provision is invalid, illegal or incapable of
being enforced, the parties hereto will negotiate in good faith to modify this Agreement so as to effect the original intent of the parties hereto as closely as possible in an acceptable manner in order that the transactions contemplated hereby are
consummated as originally contemplated to the greatest extent possible. 
  
 Section 13.6 Counterparts. This Agreement may be executed in one or more counterparts, all of which will be considered one and the same agreement and will become effective when one or more counterparts have been signed by each of the
parties hereto and delivered to the other parties hereto, it being understood that all parties hereto need not sign the same counterpart. 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 Section 13.7 Entire Agreement; No Third Party Beneficiaries. This Agreement (together with the schedules and exhibits
attached hereto) constitutes the entire agreement and supersedes all prior agreements and understandings, both written and oral, between or among the parties hereto with respect to the subject matter hereof. Except as specifically provided herein,
this Agreement is not intended to confer upon any Person other than the parties hereto any rights or remedies hereunder. 
  
 Section 13.8 Governing Law. This Agreement will be governed by and construed in accordance with the laws of the State of New York, without regard
to the conflict of law principles thereof. 
  
 Section 13.9
Specific Performance. The parties hereto agree that irreparable damage would occur in the event any provision of this Agreement were not performed in accordance with the terms hereof and that the parties hereto will be entitled to specific
performance of the terms hereof, in addition to any other remedy at law or in equity without the necessity of demonstrating the inadequacy of monetary damages and without the posting of a bond. 
  
 Section 13.10 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO
IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT, THE AGREEMENTS, INSTRUMENTS AND DOCUMENTS CONTEMPLATED HEREBY OR THE TRANSACTIONS CONTEMPLATED HEREBY AND FOR ANY COUNTERCLAIM
THEREIN. 
  
 Section 13.11 Publicity. Neither party will
make any public announcement concerning, or otherwise publicly disclose, any information with respect to the transactions contemplated by this Agreement or any of the terms and conditions hereof without the prior written consent of the other parties
hereto, which consent will not be unreasonably withheld. Notwithstanding the foregoing, either party may make any public disclosure concerning the transactions contemplated hereby that in the opinion of such party’s counsel may be required by
law or the rules of any stock exchange on which such party’s or its Affiliates’ securities trade; provided, however, the party making such disclosure will provide the non-disclosing party with a copy of the intended
disclosure reasonably, and to the extent practicable, prior to public dissemination, and the parties hereto will coordinate with one another regarding the timing, form and content of such disclosure; and provided, further, the parties
agree that the form of press release attached hereto as Exhibit H may be issued by the Buyer or Sellers at any time following the Closing. 
  
 Section 13.12 Assignment. Neither party may assign its rights or obligations under this Agreement without the prior written consent of the other
party; provided, however, that, so long as any such successor or assign agrees in writing to be bound by this Agreement, (i) either party may assign its rights and obligations under this Agreement, without the prior written consent of
the other party, to an Affiliate or to a successor of the relevant portion of the assigning party’s business by reason of merger, sale of all or substantially all of its assets or any similar transaction and, (ii) without limiting the foregoing
clause (i), Buyer may assign its rights and obligations under this Agreement as to any product, as well as the assets and rights associated with such product, to any acquirer of Buyer’s rights to such product. Any permitted assignee will assume
all obligations of its assignor under this Agreement (although, in the instance of a product 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 assignment, such obligations will be limited to the obligations under this Agreement that relate to such product). No assignment will
relieve either party of its responsibility for the performance of any obligation. This Agreement will be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns. 
  
 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed by their respective representatives thereunto duly authorized, all as of the date first written above. 
  

	 NOVARTIS AG

		
	 By:
	 	     /s/ George Miller, Authorized Signatory

	 	 	 Name:

	 	 	 Title:

  

		
	 By:
	 	     /s/ Peter Rupprecht, Authorized Signatory

	 	 	 Name:

	 	 	 Title:

  

	 NOVARTIS PHARMACEUTICALS
 CORPORATION

		
	 By:
	 	     /s/    Joseph Farzetta

	 	 	 Name: Joseph Farzetta

	 	 	 Title:

  

	 XCEL PHARMACEUTICALS, INC.

		
	 By:
	 	     /s/ Michael T. Borer

	 	 	 Name: Michael T. Borer

	 	 	 Title: President and Chief Executive Officer

 CONFIDENTIAL TREATMENT REQUESTED 
  
 SCHEDULES AND EXHIBITS 
  

Schedules 
  
 Schedule 1.1(a) – Assigned Contracts and Assumed Contractual Obligations 
  
 Schedule 1.1(b) – Structure of Dihydroergotamine 
  
 Schedule 1.1(c) – Permitted Encumbrances 
  
 Schedule 1.1(d) –
[CONFIDENTIAL TREATMENT REQUESTED] 
  
 Schedule 2.2(a)(i) – Patents

  
 Schedule 2.2(a)(x) – Websites 
  
 Schedule 2.2(b)(iii) – Excluded Assets 
  
 Schedule 5.3 – Consents and Approvals 
  
 Schedule 5.5 – Title to Assets 
  
 Schedule 5.6 – Litigation 
  
 Schedule 5.7 – Regulatory 
  
 Schedule 5.8 – Compliance with Laws 
  
 Schedule 5.9 – Contracts 
  
 Schedule 5.10 – Intellectual Property 
  
 Exhibits 
  
 Exhibit A – Assumption Agreement 
  
 Exhibit B – Bill of Sale and Assignment 
  
 Exhibit C – Patent Assignment 
  
 Exhibit D – Supply Agreement 
  
 Exhibit E – Trademark Assignment 
  
 Exhibit F – Purchase Price Allocation 
  
 Exhibit G – Form for Submission of Medicaid Rebate Data 
  
 Exhibit H – Form of Press Release 
  
 The schedules and exhibits have been omitted from this Agreement as filed
with the Securities and Exchange Commission (the “SEC”). The omitted information is considered 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 immaterial from an investor’s perspective. The Registrant will furnish supplementally a copy of any of the documents to the SEC upon
request of the SEC.Collaboration and License Agreement

 EXHIBIT 10.7 
  
 CONFIDENTIAL TREATMENT REQUESTED 
  
 CONFIDENTIAL TREATMENT REQUESTED: INFORMATION FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED IS OMITTED AND IS NOTED WITH “[CONFIDENTIAL TREATMENT
REQUESTED].” AN UNREDACTED VERSION OF THIS DOCUMENT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 
  
 COLLABORATION AND LICENSE AGREEMENT 
  
 THIS COLLABORATION AND LICENSE AGREEMENT (the “Agreement”) is made and entered into as of September 3, 2003 (the
“Effective Date”), by and between POZEN INC., a Delaware corporation (“POZEN”), with a business address of 1414 Raleigh Road, Suite 400, Chapel Hill, NC 27517, and XCEL PHARMACEUTICALS, INC., a
Delaware corporation (“Xcel”), located at 6363 Greenwich Drive, Suite 100, San Diego, CA 92122. POZEN and Xcel are sometimes referred to in this Agreement individually as a “Party” and collectively as
“Parties.” 
  
 RECITALS 
  
 A. Xcel is a specialty pharmaceutical company focused on the treatment
of disorders of the central nervous system and possesses substantial expertise in the marketing of pharmaceutical products for the treatment of migraine. 
  
 B. POZEN is a pharmaceutical development company currently specializing in the development of products for migraine therapy. 
  
 C. Xcel desires to obtain, and POZEN is willing to grant, the
exclusive right to market, promote, sell and distribute POZEN’s MT 300TM product within the United States of America and its territories in accordance with this Agreement. 
  
 AGREEMENT 
  
 In consideration of the mutual covenants contained in this Agreement and other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the Parties agree as follows: 
  
 1. DEFINITIONS

  
 The capitalized terms used herein will have the meanings
given to them in this Section 1 and throughout this Agreement. Unless the context indicates otherwise, the singular will include the plural and the plural will include the singular. 
  
 1.1 “Affiliate” means a corporation or other business entity which, directly or indirectly, through
one or more intermediaries, controls, is controlled by or is under common control with a Party. For purposes of this definition only, “control” and, with corresponding meanings, the terms “controlled by” and “under common
control with,” means (a) the possession, directly or indirectly, of the power to direct the management or policies of a legal entity, whether through the ownership of voting securities or by contract relating to voting rights 

  

 1 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 
or corporate governance, or (b) the ownership, directly or indirectly, of more than 50% of the voting securities or other ownership interest of a legal
entity; provided, however, that if local law restricts foreign ownership, control will be established by direct or indirect ownership of the maximum ownership percentage that may, under such local law, be owned by foreign interests.

  
 1.2 “ANDA” means an abbreviated NDA
filed pursuant to 21 C.F.R. §§ 314.92 et seq. (2003), or any equivalent filing as may be available at the time. 
  
 1.3 “Autoinjector” means the automatic injection device for multiple uses selected by the Parties in accordance with Section
3.2.1. 
  
 1.4 “Autoinjector Presentation”
means the Initial Licensed Product in the Autoinjector. 
  
 1.5
“CMC” has the meaning as set forth in Section 2.1. 
  
 1.6 “Combination Product” means [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 1.7 “Commercial Launch” means nationwide launch of commercial sale, promotion and distribution of a Licensed Product in the
Territory following Marketing Approval for such Licensed Product. 
  
 1.8 “Commercialization” means (a) pre-launch market development activities conducted with a product in anticipation of Marketing Approval, and (b) marketing, promotion, use, advertising, selling, having sold,
distributing or importing a product after Marketing Approval has been obtained. The term “Commercialize” has a correlative meaning. 
  
 1.9 “Commercially Reasonable Efforts” mean, as to either Party relative to any Licensed Product, those efforts and resources
normally used by such Party for a product owned by it which has a similar market potential and is at a similar stage in its product life cycle as the Licensed Product at issue; provided, however, that such efforts and resources will be no
less than those typically applied by a pharmaceutical company of similar size as such Party as of the Effective Date (or any larger size that such Party may have at such later time) for a product owned by such company which has a similar market
potential and is at a similar stage in its product life cycle as the Licensed Product at issue. 
  
 1.10 “Confidential Information” has the meaning as set forth in Section 13.1. 
  
 1.11 “Control” means, with respect to any Patent,
Know-How, Improvement or other intellectual property right, the possession of the ability to grant a license or a sublicense to such Patent, Know-How, Improvement or right as provided for in this Agreement without violating the terms of any
agreement with any Third Party. 
  
 1.12
“Controlled Affiliates” with respect to a Party, mean the Affiliates of such Party which are controlled by such Party (with “controlled by” having the meaning set forth in the definition of “Affiliate”
above). 
  

 2 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 1.13 “Development Costs” mean (a) the direct costs and expenses and (b) the indirect costs and
expenses associated with the operation of any laboratory or manufacturing facilities, in each instance (i) incurred by a Party in carrying out research and development activities agreed to by the Parties and conducted by or on behalf of a Party as
contemplated pursuant to this Agreement and (ii) calculated in accordance with generally accepted accounting principles consistently applied and in accordance with such Party’s cost accounting systems. Development Costs include all reasonable
out-of-pocket costs, such as materials, consultants, and other outside services, attributable to the performance of such activities. Employees of any Party at issue will be charged [CONFIDENTIAL TREATMENT REQUESTED] (which will be increased
once annually on the anniversary of the Effective Date based on any increases of the consumer price index (United States Department of Labor U.S. City Average for All Items, or any successor index) following the Effective Date). 
  
 1.14 “Development Fees” mean a Party’s
[CONFIDENTIAL TREATMENT REQUESTED]. 
  
 1.15
“Development Study” has the meaning as set forth in Section 3.3.1. 
  
 1.16 “DHE” has the meaning as set forth in Section 4.1.1. 
  
 1.17 “DHE-45” means the injectable formulation of dihydroergotamine described in U.S. NDA #[CONFIDENTIAL TREATMENT
REQUESTED] (as supplemented or amended from time to time). 
  
 1.18 “Dispute Resolution” means the process for resolving Disputes as outlined in Section 16. 
  
 1.19 “Dispute” has the meaning as set forth in Section 16.1. 
  
 1.20 “Excepted Communications” mean information regarding Licensed Products set forth in detail
aids, promotional pieces and sales force reprints of information already in the public domain. 
  
 1.21 “FDA” means the United States Food and Drug Administration, or any successor agency thereof. 
  
 1.22 “FD&C Act” means the United States Federal Food, Drug and Cosmetics Act, as amended from time to time. 
  
 1.23 “Field” means the treatment of [CONFIDENTIAL
TREATMENT REQUESTED] by means of a prescription pharmaceutical product. 
  
 1.24 “First Commercial Sale Date” means the date of the first commercial sale of a Licensed Product by Xcel to a Third Party in the Territory following receipt of Marketing Approval for
such Licensed Product in the Territory. 
  
 1.25
“Foreign Licensed Product” means any Royalty Product which (a) is developed or manufactured inside or outside the Territory for Commercialization outside the Territory or is 

  

 3 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 
Commercialized outside the Territory and (b) would, if developed, manufactured or Commercialized inside the Territory, infringe one or more Valid Claims
under the POZEN Patents; provided, however, that in all events: (i) the Initial Licensed Product and the Autoinjector Presentation are deemed to be Foreign Licensed Products; and (ii) DHE-45 is deemed not to be a Foreign Licensed Product.

  
 1.26 “[CONFIDENTIAL TREATMENT
REQUESTED]” means [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 1.27 “[CONFIDENTIAL TREATMENT REQUESTED]” means [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 1.28 “Improvement” means any invention, discovery or Know-How, whether or not patentable, relating to any Royalty Product and
made, conceived or reduced to practice after the Effective Date and during the Term, but excluding any such invention, discovery or Know-How to the extent incorporated into any Valid Claim within an Xcel Patent or a POZEN Patent. 
  
 1.29 “IND” means an Investigational New Drug
Application filed with the FDA in conformance with applicable laws and regulations. 
  
 1.30 “Initial Licensed Product” means that certain injectable formulation of dihydroergotamine designated by POZEN as MT 300 for which POZEN has filed the POZEN NDA. 
  
 1.31 “Know-How” means non-public information, results
and data of any type whatsoever, in any tangible or intangible form whatsoever, including databases, practices, methods, techniques, specifications, formulations, formulae, knowledge, know-how, skill, experience, test data including pharmacological,
medicinal chemistry, biological, chemical, biochemical, toxicological and clinical test data, analytical and quality control data, stability data, studies and procedures, and manufacturing process and development information, results and data.

  
 1.32 “Knowledge of POZEN” means the
collective knowledge or recollection, as of the Effective Date and as to any facts or circumstances that relate to the subject matter of any representation or warranty at issue, of [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 1.33 “[CONFIDENTIAL TREATMENT REQUESTED]” means
[CONFIDENTIAL TREATMENT REQUESTED]. 
  
 1.34
“[CONFIDENTIAL TREATMENT REQUESTED]” means [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 1.35 “Licensed Product” means any Royalty Product [CONFIDENTIAL TREATMENT REQUESTED]; provided, however, that in all
events: (i) the Initial Licensed Product and the Autoinjector Presentation are deemed to be Licensed Products; and (ii) DHE-45 is deemed not to be a Licensed Product. 
  

 4 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 1.36 “Licensed Technology” means the POZEN Patents, POZEN Know-How and POZEN Improvements.

  
 1.37 “Manufacturing Liaison Costs”
mean (a) the direct costs and expenses and (b) the indirect costs and expenses associated with the operation of any laboratory or manufacturing facilities, in each instance (i) incurred by POZEN pursuant to Section 4.4 of this Agreement in carrying
out reasonably necessary manufacturing liaison activities and (ii) calculated in accordance with generally accepted accounting principles consistently applied and in accordance with POZEN’s cost accounting systems. Manufacturing Liaison Costs
include, without limitation, all reasonable out-of-pocket costs, such as materials, consultants, and other outside services, attributable to performance of such activities. Employees of POZEN will be charged [CONFIDENTIAL TREATMENT REQUESTED]
(subject to increase in respect of adjustments to the consumer price index (United States Department of Labor U.S. City Average for All Items, or any successor index) following the Effective Date). 
  
 1.38 “Manufacturing Liaison Fee” means POZEN’s
[CONFIDENTIAL TREATMENT REQUESTED]. 
  
 1.39
“Marketing Approval” means the final approval received from the FDA for a product in the United States, immediately following which such product may be commercially sold in the United States. 
  
 1.40 “Marketing Plan” has the meaning as set forth in
Section 5.2.1. 
  
 1.41 “NDA” means a new
drug application submitted to the FDA to obtain FDA approval for the marketing of a pharmaceutical product in the United States. 
  
 1.42 “Net Sales” mean the amount of gross sales of product to Third Parties [CONFIDENTIAL TREATMENT REQUESTED], less the
following deductions: 
  
 (a) Quantity,
trade, cash and other discounts actually allowed or given by Xcel; 
  
 (b) Discounts, replacements, credits, refunds and allowances actually allowed or given by Xcel for product returns or rejections or indigent patient and similar programs; 
  
 (c) Rebates, chargebacks and price adjustments
actually allowed or given by Xcel to customers; 
  
 (d) Actual write-offs of uncollectible amounts receivable by Xcel; provided, however, that if any such amount is in fact subsequently received by Xcel, such received amount will be included in the calculation of Net Sales;

  
 (e) Import, export, excise, sales or
use taxes, value added taxes, and other taxes, tariffs or duties levied, absorbed or directly imposed and properly allocable to product sales (in any event excluding taxes on the income of Xcel); and 

  

 5 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 (f) Freight, postage, shipping, insurance, and packaging costs and other outbound transportation
charges to the extent included in the invoiced amount; 
  
 provided, however, that: 
  
 (x) Net Sales will be determined, without limitation, with reference to the amount or fair market value of all consideration received by Xcel for sale of a product, whether such consideration is in cash, payment in kind, exchange or
other form; provided that if: (i) a product is sold together with other goods, with or without a separate price for such product, (ii) the consideration exchanged for a product includes any non-cash consideration, or (iii) a product is transferred
in any other manner other than as an invoiced sale, then the Net Sales applicable to the quantity of such product included in any such transaction will be deemed to be the average Net Sales for such quantity of such product for all transactions of
such product (other than those described in the preceding clauses (i)-(iii), inclusive) made in the Territory (1) during the last full calendar quarter prior to such transaction, or (2) if there were no Net Sales during the prior calendar quarter,
during the current calendar quarter; 
  
 (y) Products transferred free of charge in connection with the performance of clinical trials, testing, quality control or other development work, or as professional samples will not be included in the calculation of Net Sales; and

  
 (z) Amounts relevant to the
determination of Net Sales, and the timing of sales, will be [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 1.43 “Patent” means patents, applications for patents, provisional applications for patents, and any patents issuing therefrom
(including any divisions, continuations, continued prosecution applications and continuations-in-part thereof), reexamination certificates, reissue patents, patent extensions, and patent term restorations. 
  
 1.44 “POZEN Improvements” mean any and all
Improvements owned or Controlled by POZEN that are (a) Technologically Necessary for the development, manufacture or Commercialization of any Licensed Product, or (b) necessary for the development or manufacture of the Initial Licensed Product, or
(c) developed in the course of performing this Agreement solely by POZEN or its Affiliates or Third Party contractors, or jointly by POZEN and Xcel or its or their Affiliates or Third Party contractors, and useful for the development, manufacture or
Commercialization of any Royalty Product. 
  
 1.45
“POZEN Know-How” means any and all Know-How owned or Controlled by POZEN as of the Effective Date that is (a) Technologically Necessary for the development, manufacture or Commercialization of any Licensed Product, or (b)
necessary for the development, manufacture or Commercialization of the Initial Licensed Product, or (c) useful for the development, manufacture or Commercialization of any Royalty Product and is disclosed to Xcel during the Term. 
  
 1.46 “POZEN NDA” means NDA #[CONFIDENTIAL
TREATMENT REQUESTED] (as supplemented or amended from time to time) or any NDA filed as a replacement for such NDA. 
  

 6 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 1.47 “POZEN Patents” mean any and all Patents owned or Controlled by POZEN during the Term with
Valid Claims that would be infringed, in the absence of a license, by the development or Commercialization of any Royalty Product in the Territory, or by the manufacture of any Royalty Product anywhere in the world. In any event, POZEN Patents
include the following: 
  
 (a) those
certain patents and patent applications identified on Exhibit D attached hereto; 
  
 (b) any patents that are or may be granted from any of the patents or patent applications referred to in this definition, including
any extensions, continuations, continuations-in-part, divisionals, reissues, reexaminations, renewals, additions, registrations and confirmations thereof; and 
  

(c) any patents or patent applications claiming priority of any of the patents or patent applications referred to in this
definition. 
  
 1.48 “POZEN Trademarks”
mean any trademarks or trade names used or registered by POZEN to identify itself in the Territory. 
  
 1.49 “Product Trademarks” mean any trademarks, trade dress, logos, slogans, and designs, whether or not registered in the
Territory, used to identify or promote any Licensed Product in the Territory, but excluding any Xcel Trademarks or POZEN Trademarks. 
  
 1.50 “Promotional Materials” mean all sales representative training materials and all written, printed, graphic, electronic, audio
or video matter, including but not limited to journal advertisements, sales visual aids, leave-behind items, formulary binders, reprints, direct mail, direct-to-consumer advertising, internet postings, media broadcast advertisements, and sales
reminder aids (for example, note pads, pens and other such items) intended for use or used by Xcel in connection with the promotion of any Licensed Product. 
  
 1.51 “PTO” means the United States Patent and Trademark Office. 
  
 1.52 “Reciprocating Licensee” has the meaning set forth in Section 7.4. 
  
 1.53 “Reference-Listed Drug” means a listed drug
identified by the FDA as a drug product upon which an applicant may rely in seeking approval of an ANDA (or any equivalent process as may be available at the time). 
  
 1.54 “Regulatory Approval” means any approvals and any master files, establishment licenses,
registrations or authorizations of any national or local regulatory agency, department, bureau or other governmental entity, necessary for the manufacture, use, storage, importation, export, transport, distribution or sale of any Licensed Product in
the Field in the Territory. 
  
 1.55 “Royalty
Product” means [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 1.56 “Royalty Term” means the duration of Xcel’s obligation to pay royalties under Section 8.3 as set forth in Section 8.3.2. 
  

 7 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 1.57 “SNDA” means a supplemental NDA filed pursuant to 21 C.F.R. § 314.70 (2003), or any
equivalent filing as may be available at the time. 
  
 1.58
“Technologically Necessary” means, with respect to any Improvement or Know-How relative to a Licensed Product, that either (a) such Licensed Product could not be [CONFIDENTIAL TREATMENT REQUESTED] or (b) the use or
development of [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 1.59 “Term” has the meaning as set forth in Section 14.1. 
  
 1.60 “Territory” means the United States of America and its territories (including Puerto Rico). 
  
 1.61 “Third Party” means any individual or entity other than POZEN, Xcel and their respective Affiliates. 
  
 1.62 “Third Party Payments” mean [CONFIDENTIAL
TREATMENT REQUESTED] that are paid by Xcel to any Third Party solely to acquire rights to intellectual property rights that would be infringed or misappropriated in the absence of a license (a) by the development or Commercialization of the
Initial Licensed Product or the Autoinjector Presentation in the Territory, or (b) by the manufacture of the Initial Licensed Product or the Autoinjector Presentation in any country inside or outside the Territory where any such product is being
manufactured (“Blocking IP”). With respect to the Autoinjector Presentation, Blocking IP will not include any intellectual property rights held by the developer or manufacturer of the Autoinjector to the extent pertaining solely to
the Autoinjector. In the event that any payments are made to a Third Party that is not only granting a license to any Blocking IP, but also providing services or supplying product or materials to Xcel or a Third Party manufacturing the Initial
Licensed Product or the Autoinjector Presentation, then the Parties will in good faith determine the applicable amount of such payments made with respect to the acquisition of rights to Blocking IP, and only such amount will be deemed a Third Party
Payment. 
  
 1.63 “Valid Claim” means (a)
any claim of an issued and unexpired Patent that has not been held unenforceable or invalid by a court or other governmental agency of competent jurisdiction in a decision that is not appealed or cannot be appealed, and that has not been disclaimed
or admitted to be invalid or unenforceable through reissue, reexamination, disclaimer or otherwise, and (b) a pending claim in a bona fide, pending patent application so long as such patent claim is prosecuted with customary diligence.
Notwithstanding the foregoing clause (b), in the event that a pending claim in a pending patent application does not issue as a valid and enforceable claim in an issued patent within [CONFIDENTIAL TREATMENT REQUESTED] after the earliest date
from which such claim was initially applied for, such a pending claim will not be a Valid Claim, unless and until such pending claim subsequently issues as a valid and enforceable claim in an issued patent, in which case such claim will be
reinstated and be deemed to be a Valid Claim, subject to the other provisions of this definition, as of the date of issuance of such patent. 
  
 1.64 “Xcel Improvements” mean any and all Improvements owned or Controlled by Xcel that are (a) Technologically Necessary for the
development, manufacture or 

  

 8 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 Commercialization of any Licensed Product, or (b) necessary for the development or manufacture of the Initial Licensed Product, or (c)
developed in the course of performing this Agreement solely by Xcel or its Affiliates or Third Party contractors, or jointly by Xcel and POZEN or its or their Affiliates or Third Party contractors, and useful for the development, manufacture or
Commercialization of any Royalty Product. 
  
 1.65
“Xcel Know-How” means any and all Know-How owned or Controlled by Xcel as of the Effective Date that is (a) Technologically Necessary for the development, manufacture or Commercialization of any Licensed Product, or (b)
necessary for the development, manufacture or Commercialization of the Initial Licensed Product, or (c) useful for the development, manufacture or Commercialization of any Royalty Product and is disclosed to POZEN during the Term. 
  
 1.66 “Xcel Patents” mean any and all Patents owned or
Controlled by Xcel during the Term with Valid Claims that would be infringed, in the absence of a license, by the development, manufacture or Commercialization of any Royalty Product. In any event, Xcel Patents include the following: 
  
 (a) those certain patents and patent applications
identified on Exhibit E attached hereto; 
  
 (b) any patents that are or may be granted from any of the patents or patent applications referred to in this definition, including any extensions, continuations, continuations-in-part, divisionals, reissues, reexaminations,
renewals, additions, registrations and confirmations thereof; and 
  
 (c) any patents or patent applications claiming priority of any of the patents or patent applications referred to in this definition. 
  
 1.67 “Xcel Post-Approval Study” means any Xcel-sponsored study funded through a grant to one or more
investigators [CONFIDENTIAL TREATMENT REQUESTED] and conducted with a Licensed Product following Marketing Approval for such Licensed Product. 
  
 1.68 “Xcel Technology” means the Xcel Patents, Xcel Know-How and Xcel Improvements. 
  
 1.69 “Xcel Trademarks” mean any trademarks or trade
names used or registered by Xcel to identify itself in the Territory. 
  
 2.     COLLABORATION GOVERNANCE 
  
 2.1 Formation and Composition of the Collaboration Management Committee. The Parties will manage the Commercialization and further development of any Licensed Products through a collaboration management committee (the
“CMC”). Prior to the first meeting of the CMC, each Party will designate two (2) of its employees as its members on the CMC (although each Party may bring additional employees to any meeting of the CMC). An alternate member
designated by a Party may serve temporarily in the absence of a permanent member. Each Party may replace any of its permanent members of the CMC by providing 
  

 9 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 written notice thereof to the other Party. Each Party will bear its own costs of participation in the CMC. 
  
 2.2 Functions and Powers of the CMC. The CMC will perform the
following functions, and such other functions assigned to it in this Agreement: [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 2.3 Limitations of CMC Powers. The CMC will have only such powers as are specifically delegated to it in this Agreement, and will have no
power to amend this Agreement or waive a Party’s rights or obligations under this Agreement. 
  
 2.4 CMC Actions. No business will be transacted at any meeting of the CMC unless at least one member from each Party is present. Each Party
will have one vote (i.e., if more than one member attends any meeting of the CMC on behalf of a Party, both members of such Party may collectively exercise only one vote), and actions by the CMC will be taken only with the approval of each Party. If
the CMC is unable to obtain the approval of both Parties on any matter within 15 days of the first vote at which no unanimous decision was reached on such matter, then either Party may refer such matter to the Chief Executive Officers of the Parties
for resolution. If a matter is so referred, then such Chief Executive Officers will meet within 15 days of referral to discuss such matter in good faith. If such discussions do not result in a mutually acceptable resolution within 10 days of such
meeting, [CONFIDENTIAL TREATMENT REQUESTED]. Notwithstanding this Section 2.4, either Party may initiate dispute resolution procedures pursuant to Section 16 if the subject of such dispute is alleged to constitute a breach of contract by the
other Party. 
  
 2.5 CMC Meetings. The CMC will hold
meetings at such times and places as will be determined by the Parties, but in no event will such meetings be held in person less frequently than as follows: (a) [CONFIDENTIAL TREATMENT REQUESTED] during the [CONFIDENTIAL TREATMENT
REQUESTED] following the Effective Date; (b) [CONFIDENTIAL TREATMENT REQUESTED] during the [CONFIDENTIAL TREATMENT REQUESTED] following the Effective Date; (c) [CONFIDENTIAL TREATMENT REQUESTED] during [CONFIDENTIAL
TREATMENT REQUESTED] following the Effective Date; and (d) thereafter, [CONFIDENTIAL TREATMENT REQUESTED] upon the request of either Party; provided, however, that any meeting of the CMC which is solely for the purpose of
addressing matters referenced in Section 2.2(d) will not count for purposes of determining whether the provisions of this sentence have been satisfied. The first meeting of the CMC will take place within 90 days after the Effective Date. In addition
to the meetings specified above, if any material matters exist and are pending review or approval by the CMC as contemplated by this Agreement, then either Party may call a meeting of the CMC on at least 30 days’ written notice to the
other Party. 
  

 10 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 3.    REGULATORY MATTERS; DEVELOPMENT 
  
 3.1  Initial Licensed Product. 
  
 3.1.1 POZEN has filed the POZEN NDA in its own name and at its own expense. Subject to the provisions
of Section 3.4, prior to approval of the POZEN NDA, POZEN will be solely responsible for any and all communications with the FDA relating to the Initial Licensed Product or the POZEN NDA. 
  
 3.1.2 Upon approval by the FDA of the POZEN NDA, POZEN will transfer such approved NDA to Xcel.
Following such transfer, Xcel will maintain such NDA during the Term at Xcel’s expense and will (a) obtain and maintain such other Regulatory Approvals as are necessary for the Commercialization of the Initial Licensed Product in the Territory,
and (b) exercise Commercially Reasonable Efforts to cause any manufacturers of the Initial Licensed Product (or any components thereof, as applicable) to obtain and maintain such other Regulatory Approvals as are necessary for the manufacture at
their respective facilities of the Initial Licensed Product (or any components thereof, as applicable) for commercial sale in the Territory. 
  
 3.1.3 POZEN will retain the IND filed by POZEN for the Initial Licensed Product until POZEN has either (a) [CONFIDENTIAL
TREATMENT REQUESTED] the SNDA for the Autoinjector Presentation (the “Autoinjector SNDA”) for submission to the FDA pursuant to Section 3.2 and such SNDA is approved by the FDA, or (b) [CONFIDENTIAL TREATMENT REQUESTED]
the Autoinjector SNDA and Xcel has [CONFIDENTIAL TREATMENT REQUESTED] the Autoinjector SNDA, which ever occurs first. At such time, POZEN will transfer such IND to Xcel, subject to POZEN’s retained right to have Xcel make filings to such
IND on behalf of POZEN, at POZEN’s request and expense, for purposes of further development of Licensed Products by POZEN for use outside the Territory. 
  
 3.1.4 If the FDA requires or suggests that additional data or information be submitted by POZEN as a condition to approving the
POZEN NDA, POZEN will inform Xcel thereof without delay. Subject to Section 3.1.5 below, [CONFIDENTIAL TREATMENT REQUESTED] will conduct such studies (including any post-approval studies required by the FDA as a condition to approval of the
POZEN NDA) as are necessary to satisfy the requests of the FDA, at [CONFIDENTIAL TREATMENT REQUESTED]’s expense. 
  
 3.1.5 Abandonment of POZEN NDA. 
  
 (a) If POZEN determines that the studies necessary for generating any additional data or information that are required by the FDA
for the approval of the POZEN NDA, or that are deemed necessary by POZEN to address issues or respond to questions raised by the FDA, would jeopardize the commercial viability of the Initial Licensed Product or exceed the financial resources
available at POZEN for the Initial Licensed Product, POZEN will inform Xcel thereof without delay. If the Parties are unable to come to a mutually acceptable resolution of the matter within 30 days, POZEN may elect by written notice to Xcel to
withdraw the POZEN NDA and abandon the preparation of an NDA for the Initial Licensed Product; provided, however, that in such event Xcel will be given a 
  

 11 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 reasonable opportunity (before such withdrawal or abandonment) to assume control of efforts to seek approval of the POZEN
NDA at Xcel’s cost (subject to Section 3.1.6 below). If Xcel elects to assume such control, POZEN will (i) exercise its Commercially Reasonable Efforts (at Xcel’s expense) to assist Xcel with respect to seeking approval of the POZEN NDA,
and (ii) transfer the POZEN NDA to Xcel promptly after receipt of such approval. Xcel will provide POZEN with written notice of its election within 90 days after receiving written notice of POZEN’s intent to withdraw the POZEN NDA and
abandon the preparation of an NDA for the Initial Licensed Product. 
  
 (b) If (i) Xcel does not assume control of efforts to seek approval of the POZEN NDA as provided in subsection (a) above, or (ii) Xcel assumes such control but terminates its efforts at anytime by written
notice to POZEN, or (iii) Xcel assumes such control but does not undertake or pursue any material development activities during a period of more than [CONFIDENTIAL TREATMENT REQUESTED] (provided that such [CONFIDENTIAL TREATMENT
REQUESTED] period will be extended by the period of any delays in such development activities caused by circumstances outside of Xcel’s reasonable control, but in no event will such extension exceed [CONFIDENTIAL TREATMENT
REQUESTED]), this Agreement will terminate upon receipt of the notice by POZEN. 
  
 3.1.6 If, pursuant to Section 3.1.5, POZEN elects to withdraw the POZEN NDA and abandon the preparation of an NDA for the Initial
Licensed Product and Xcel assumes control of efforts to seek approval of the POZEN NDA and obtains such approval, then, subject to the terms set forth in Section 8.4, Xcel may [CONFIDENTIAL TREATMENT REQUESTED] in connection with seeking
approval of the POZEN NDA, subject to a limit of [CONFIDENTIAL TREATMENT REQUESTED], against [CONFIDENTIAL TREATMENT REQUESTED] with respect to the Initial Licensed Product pursuant to Sections 8.2 or 8.3; provided, however,
that Xcel may [CONFIDENTIAL TREATMENT REQUESTED] that result from development activities agreed upon by the Parties, with the agreement on the part of POZEN not to be unreasonably withheld. 
  
 3.2 Autoinjector. 
  
 3.2.1 Within 90 days after the Effective Date,
POZEN will prepare the development plan for the Autoinjector Presentation (the “Autoinjector Development Plan”) and will submit such plan for review and approval by the CMC at the next meeting. The outline of the Autoinjector
Development Plan with the target timeline for the submission of the Autoinjector SNDA is attached as Exhibit B. 
  
 3.2.2 POZEN will (a) conduct all development activities relating to the Autoinjector and the Autoinjector Presentation pursuant to
the Autoinjector Development Plan at POZEN’s expense; provided that POZEN will not be required [CONFIDENTIAL TREATMENT REQUESTED] with respect to the performance of the Autoinjector Development Plan; (b) prepare the Autoinjector SNDA at
its own expense, deliver to Xcel such SNDA for filing by Xcel with the FDA and [CONFIDENTIAL TREATMENT REQUESTED]; and (c) subject to the provisions of Section 3.4, be solely responsible for any and all communications with the FDA relating to
the Autoinjector Presentation prior to the filing of the Autoinjector SNDA by Xcel pursuant to Section 3.2.3. 
  

 12 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 3.2.3 Xcel will (a) file the Autoinjector SNDA with the FDA, (b) inform POZEN of any material
developments with respect to the Autoinjector Presentation and the Autoinjector SNDA, including any requirements or suggestions by the FDA regarding the submission of data or information as a condition to approving the Autoinjector SNDA; and (c) be
the primary point of contact with the FDA relating to the Autoinjector Presentation and the Autoinjector SNDA. Upon approval by the FDA of the Autoinjector SNDA, Xcel will maintain the Autoinjector SNDA during the Term at Xcel’s expense and
will (x) obtain and maintain such other Regulatory Approvals as are necessary for the Commercialization of the Autoinjector Presentation in the Territory, and (y) exercise Commercially Reasonable Efforts to cause any manufacturers of the
Autoinjector Presentation (or any components thereof, as applicable) to obtain and maintain such other Regulatory Approvals as are necessary for the manufacture at their respective facilities of the Autoinjector Presentation (or any components
thereof, as applicable) for commercial sale in the Territory. 
  
 3.2.4 If, before or following the initial filing of the Autoinjector SNDA, the FDA requires or suggests or the Parties agree that data or information be submitted as a condition to approving the Autoinjector
SNDA in addition to the data or information that is generated in the performance of the Autoinjector Development Plan, the CMC will discuss how to address such FDA requirements and suggestions and modify the Autoinjector Development Plan as
appropriate. Subject to Section 3.2.5 below, POZEN will perform the modified Autoinjector Development Plan at [CONFIDENTIAL TREATMENT REQUESTED]’s expense. 
  
 3.2.5 If POZEN determines that (a) the performance of the Autoinjector Development Plan would require
[CONFIDENTIAL TREATMENT REQUESTED] in Development Costs, or (b) the studies necessary for generating any additional data or information that are required by the FDA for the approval of the Autoinjector SNDA, or that are deemed necessary by
POZEN or Xcel to address issues or respond to questions raised by the FDA, would jeopardize the commercial viability of the Autoinjector Presentation or exceed [CONFIDENTIAL TREATMENT REQUESTED] in Development Costs, POZEN will inform Xcel
thereof without delay. If the Parties are unable to come to a mutually acceptable resolution of the matter within 30 days, POZEN may elect to abandon the performance of the Autoinjector Development Plan or the preparation of the Autoinjector SNDA;
provided, however, that in such event Xcel will be given a reasonable opportunity (before such abandonment) to assume control of efforts to seek approval of the Autoinjector SNDA at its cost (subject to Section 3.2.6 below). If Xcel elects to
assume such control, POZEN will exercise its Commercially Reasonable Efforts to assist Xcel (at Xcel’s expense) with respect to seeking approval of the Autoinjector SNDA; provided, however, that Xcel may suspend or terminate its efforts
at anytime. 
  
 3.2.6 If, pursuant to
Section 3.2.5, POZEN elects to abandon the development of the Autoinjector Presentation or the preparation of the Autoinjector SNDA and Xcel assumes control of efforts to seek approval of the Autoinjector SNDA and obtains such approval, then,
subject to the terms set forth in Section 8.4, Xcel may [CONFIDENTIAL TREATMENT REQUESTED] in connection with the development of the Autoinjector Presentation or seeking approval of the Autoinjector SNDA, subject to a [CONFIDENTIAL
TREATMENT REQUESTED] plus [CONFIDENTIAL TREATMENT REQUESTED] in Development 
  

 13 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 Costs anticipated in Section 3.2.5 which has not been [CONFIDENTIAL TREATMENT REQUESTED] prior to its abandonment of
the development of the Autoinjector Presentation or the preparation of the Autoinjector SNDA, [CONFIDENTIAL TREATMENT REQUESTED] pursuant to Sections 8.2 or 8.3; provided, however, that Xcel may [CONFIDENTIAL TREATMENT
REQUESTED] result from development activities agreed upon by the Parties, with the agreement on the part of POZEN not to be unreasonably withheld. 
  
 3.3 Other Licensed Products. 
  
 3.3.1 Xcel will have the right, but not the obligation, to perform development studies with Licensed Products beyond the activities
contemplated by Sections 3.1 and 3.2 (each such study, a “Development Study”), including: (a) development of Licensed Products in injectable formulations and dosage strengths other than those of the Initial Licensed Product; and (b)
development of Licensed Products for indications other than the indication for which POZEN has filed the POZEN NDA. Any Development Study [CONFIDENTIAL TREATMENT REQUESTED], including study designs or protocols for such Development Study,
will be subject to review and approval by the CMC. 
  
 3.3.2 Xcel will give POZEN written notice of any Xcel Post-Approval Study that is not contemplated by a Marketing Plan previously reviewed by POZEN prior to initiating such Xcel Post-Approval Study, and POZEN will have the right to
review and [CONFIDENTIAL TREATMENT REQUESTED] such Xcel Post-Approval Study. 
  
 3.3.3 If Xcel desires that a Development Study [CONFIDENTIAL TREATMENT REQUESTED] be conducted, then Xcel will notify POZEN
of such desire and will accompany such notice with a description of the objectives for the Development Study. Promptly thereafter, the Parties will prepare a development plan and budget for such Development Study for review and approval by the CMC
(each such plan a “Study Plan”). If POZEN desires to perform such Study Plan, (a) it will notify Xcel in writing prior to the meeting at which the Study Plan is submitted to the CMC for review and approval and (b) the Parties will
negotiate an agreement with customary terms and conditions for the conduct of the Study Plan, including that Xcel will reimburse POZEN monthly on a net 30 days from invoice date payment basis for POZEN’s Development Fees incurred in connection
with such Study Plan. During such time as POZEN holds the IND for the Initial Licensed Product, POZEN agrees to make, on Xcel’s behalf, any required filings to such IND as may be required for performance of any Study Plan. 
  
 3.3.4 Xcel will, at its own expense, file any NDAs or
other regulatory filings for Licensed Products developed in a Development Study under the terms of this Agreement, and upon approval thereof will (a) obtain and maintain such other Regulatory Approvals as are necessary for the Commercialization of
the applicable Licensed Product in the Territory, and (b) exercise Commercially Reasonable Efforts to cause any manufacturers of such Licensed Product (or any components thereof, as applicable) to obtain and maintain such other Regulatory Approvals
as are necessary for the manufacture at their respective facilities of such Licensed Product (or any components thereof, as applicable) for commercial sale in the Territory. 
  
 3.3.5 POZEN will provide Xcel with [CONFIDENTIAL TREATMENT REQUESTED] updates on the clinical
development programs conducted by or on behalf of 
  

 14 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 POZEN [CONFIDENTIAL TREATMENT REQUESTED] for Foreign Licensed Products (to the extent known to POZEN), where such
activities [CONFIDENTIAL TREATMENT REQUESTED] the development, manufacture or Commercialization of any Licensed Product in the Field in the Territory. 
  
 3.4 FDA Correspondence. 
  
 3.4.1 To the extent either Party receives any material written or oral communications relating to any Licensed Product from the
FDA, such Party will promptly inform the other Party thereof (including by providing a copy of any such written communication or a written account of any such oral communication), but in no event later than five business days after receipt of such
communication. The Party that is responsible for communicating with the FDA in connection with the development, registration or Commercialization of any Licensed Product at issue under the terms of this Agreement (i.e., the Party holding the
NDA—the “Communicating Party”) will use reasonable efforts to solicit the other Party’s advice and review of the nature and text of any written communications received from or to be sent to the FDA in reasonably sufficient
time prior to responding or dispatching such communications to the FDA, and the Communicating Party will [CONFIDENTIAL TREATMENT REQUESTED] the other Party’s [CONFIDENTIAL TREATMENT REQUESTED] comments related thereto. 

 
 3.4.2 Each Party will promptly notify the other
Party, and provide such other Party with a copy, of any material correspondence or other reports or complaints submitted to or received by the first Party from the FDA or any Third Party claiming that any Promotional Materials are inconsistent with
any Licensed Product labeling or are otherwise in violation of applicable law or regulation. 
  
 3.4.3 Each Party will provide the other Party with a copy of any material documents or reports filed with the FDA during the Term
with respect to any Licensed Product. 
  
 3.4.4
Prior to the transfer of the POZEN NDA to Xcel from POZEN pursuant to Section 3.1.2, (a) Xcel will be provided with the opportunity to have an observer in attendance at any in-person meetings or pre-scheduled telephone calls with the FDA with
respect to any Licensed Product and (b) the Parties will agree on any change to the labeling for the Initial Licensed Product (as compared with the draft label included in the POZEN NDA as of the Effective Date). [CONFIDENTIAL TREATMENT
REQUESTED]. 
  
 3.5 Adverse Events Reporting.

  
 3.5.1 For purposes of this Section
3.5: (a) the definition “drug safety reports” shall comply with the requirements set forth by the FDA in the Code of Federal Regulations, Title 21 CFR 312.32 (“IND Safety Reports”); and (b) all information provided to Xcel
pursuant to this Section 3.5 will be provided in a complete and accurate manner. 
  
 3.5.2 During such time as Xcel holds the POZEN NDA and POZEN holds the IND for the Initial Licensed Product or is performing work
under an IND for any Licensed Product or Foreign Licensed Product, POZEN will submit to Xcel all drug safety reports for Licensed Products or Foreign Licensed Products brought to the attention of POZEN (whether 
  

 15 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 inside or outside the Territory) as well as any material events and matters concerning or affecting the safety of Licensed
Products or Foreign Licensed Products. POZEN will forward copies of all such drug safety reports to Xcel within seven days of receipt thereof by POZEN. 
  
 3.6 Compliance with Laws. 
  
 3.6.1 Xcel will comply with all laws, regulations, and ordinances (including any laws, regulations, and ordinances prohibiting the
promotion of Royalty Products prior to Marketing Approval) applicable to the performance by Xcel of this Agreement (including, as applicable, the development, manufacture and Commercialization of Royalty Products by Xcel in the Territory).

  
 3.6.2 POZEN will comply with all laws,
regulations, and ordinances applicable to the performance by POZEN of this Agreement. 
  
 3.7 Records. Each Party will keep complete, accurate and authentic accounts, notes, data and records (in good scientific manner and as required by applicable regulatory rules and regulations) of all
activities performed by or for it pursuant to this Agreement. 
  
 4.
MANUFACTURE AND SUPPLY 
  
 4.1 Manufacturing and
Supply Agreement for [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 4.1.1 Promptly following the Effective Date, Xcel will exercise good faith efforts to enter into an agreement with [CONFIDENTIAL TREATMENT REQUESTED]. POZEN will exercise good faith efforts to assist
Xcel in its discussions and negotiations with [CONFIDENTIAL TREATMENT REQUESTED] with respect to such agreement. Xcel will keep POZEN informed of the progress of Xcel’s negotiations with [CONFIDENTIAL TREATMENT REQUESTED] and, as
applicable, provide POZEN with a near-final draft of such agreement and a copy of such agreement as executed. 
  
 4.1.2 Xcel hereby covenants and agrees that, [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 4.2 Manufacturing and Supply Agreement for [CONFIDENTIAL TREATMENT
REQUESTED]. 
  
 4.2.1 Promptly
following the Effective Date, Xcel will exercise good faith efforts to enter into an agreement with [CONFIDENTIAL TREATMENT REQUESTED]. POZEN will exercise good faith efforts to assist Xcel in its discussions and negotiations with
[CONFIDENTIAL TREATMENT REQUESTED] with respect to such agreement. Xcel will keep POZEN informed of the progress of Xcel’s negotiations with [CONFIDENTIAL TREATMENT REQUESTED] and, as applicable, provide POZEN with a near-final
draft of such agreement and a copy of such agreement as executed. 
  
 4.2.2 The Parties acknowledge that [CONFIDENTIAL TREATMENT REQUESTED]. POZEN will exercise its Commercially Reasonable Efforts so that, as soon as 
  

 16 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 reasonably possible following the Effective Date, [CONFIDENTIAL TREATMENT REQUESTED]. [CONFIDENTIAL TREATMENT
REQUESTED] will be responsible for [CONFIDENTIAL TREATMENT REQUESTED]. Thereafter, the Parties will [CONFIDENTIAL TREATMENT REQUESTED], and each of the Parties will exercise its Commercially Reasonable Efforts to [CONFIDENTIAL
TREATMENT REQUESTED]. Notwithstanding the preceding sentence, [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 4.3 Quality Agreement for [CONFIDENTIAL TREATMENT REQUESTED]. Promptly following the Effective Date, Xcel will exercise good faith efforts
to enter into a quality agreement with [CONFIDENTIAL TREATMENT REQUESTED]. POZEN will exercise good faith efforts to assist Xcel in its discussions and negotiations with [CONFIDENTIAL TREATMENT REQUESTED] with respect to such
agreement. Xcel will keep POZEN informed of the progress of Xcel’s negotiations with [CONFIDENTIAL TREATMENT REQUESTED] and, as applicable, provide POZEN with a near-final draft of such agreement and a copy of such agreement as executed.

  
 4.4 Supply through POZEN. 
  
 4.4.1 If Xcel is unable to execute an agreement with
[CONFIDENTIAL TREATMENT REQUESTED], the Parties will negotiate in good faith regarding an agreement under which POZEN would secure the supply to Xcel of [CONFIDENTIAL TREATMENT REQUESTED]. The payments to be made by Xcel to POZEN
pursuant to subsection (a) and (b) above will be made no later than 10 days in advance of the due date of any payments required to be made by POZEN to [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 4.4.2 If Xcel is unable to execute an agreement with
[CONFIDENTIAL TREATMENT REQUESTED], the Parties will use good faith efforts to secure the supply of [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 5. COMMERCIALIZATION 
  
 5.1 Principles of Commercialization. 
  
 5.1.1 Xcel will be responsible for the Commercialization of Licensed Products in the Field in the Territory during the Term, and
will use Commercially Reasonable Efforts to perform the activities and apply the resources set forth in each Marketing Plan (defined below) [CONFIDENTIAL TREATMENT REQUESTED]. Except with respect to the costs of the development and regulatory
activities to be performed by POZEN or that may be off-set by Xcel as provided in Sections 3.1 or 3.2, Xcel will bear all expenses incurred in connection with the preparation and execution of each Marketing Plan. 
  
 5.1.2 Promptly after the Effective Date, the
appropriate representatives of each Party will meet to discuss matters pertaining to the manufacture, marketing and promotion of the Initial Licensed Product, including plans for sales force deployment, and the transfer of manufacturing
responsibilities from POZEN to Xcel. Promptly after the Effective Date, the Parties will establish a plan, to be performed at Xcel’s expense, governing the communication of scientific and technical information regarding the Initial Licensed
Product prior to approval of 
  

 17 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 the POZEN NDA, including any such information to be included in papers, posters, conference presentations, focus group
activities, conferences and meetings with doctors, and Xcel will adhere to such plan in its communications with Third Parties prior to approval of the POZEN NDA; provided, however, that the following activities will not be subject to such
plan or the restrictions of this sentence: advisory board meetings, market research activities and the development of marketing campaigns or sales and marketing materials for use after approval of the POZEN NDA (as well as any activities reasonably
related to such activities). 
  
 5.2 Marketing Plan.

  
 5.2.1 Xcel will prepare a marketing
plan for the Licensed Products for 2004 (the “Marketing Plan”) and provide a copy of the Marketing Plan to POZEN for comment [CONFIDENTIAL TREATMENT REQUESTED]. POZEN will provide its comments to the Marketing Plan to Xcel
[CONFIDENTIAL TREATMENT REQUESTED], and Xcel will finalize the Marketing Plan [CONFIDENTIAL TREATMENT REQUESTED]. The outline of the initial Marketing Plan for the Initial Licensed Products is attached hereto as Exhibit C.

  
 5.2.2 Xcel will update the Marketing
Plan at least once every year, and will submit each updated Marketing Plan to POZEN for review and comment in accordance with Xcel’s corporate planning cycle and with sufficient lead time for POZEN to have a reasonable opportunity to review and
comment on such updated Marketing Plan. 
  
 5.2.3 Each Marketing Plan will include, [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 5.3 Co-Promotion. 
  
 5.3.1 POZEN may co-promote any Licensed Product in the Territory in the event that: 
  
 (a) [CONFIDENTIAL TREATMENT REQUESTED]; or

  
 (b) [CONFIDENTIAL TREATMENT
REQUESTED]. 
  
 5.3.2 If Section
5.3.1(b) above is applicable, then, for a period of 60 days thereafter, the Parties will negotiate in good faith a co-promotion agreement governing the co-promotion of the applicable Licensed Product by POZEN in the Territory (with the intent that
such agreement will contain terms and conditions customary for a co-promotion agreement in the pharmaceutical industry, as well as providing for a co-promotion role for POZEN in the marketing and promotion of the applicable Licensed Product
commensurate with [CONFIDENTIAL TREATMENT REQUESTED] and in accordance with the Marketing Plan then in effect, although Xcel will set the sales price, [CONFIDENTIAL TREATMENT REQUESTED], and book all sales revenue). If the Parties are
unable to agree on all terms of such a co-promotion agreement with respect to the applicable Licensed Product prior to expiration of such 60-day period, then either Party may invoke and proceed in accordance with the dispute resolution
procedure set forth in Exhibit F attached hereto. 
  

 18 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 5.3.3 If Xcel desires to enter into a co-promotion arrangement for a Licensed Product with a Third
Party, subject to the terms set forth in Section 5.3.4 below, then Xcel will notify POZEN of such desire and will accompany such notice with a description of the intended role for such Third Party (including a description of related requirements
such as the number and territory of sales representatives and the number, frequency and positioning of details). If POZEN desires to perform such co-promotion arrangement, it will notify Xcel in writing within 30 days after receipt of the
corresponding notice from Xcel. In the event that POZEN is able to provide the resources that Xcel is seeking for the performance of the requirements identified by Xcel, promptly thereafter the Parties will negotiate, for a period of 60 days, a
co-promotion agreement governing the co-promotion of the applicable Licensed Product by POZEN in the Territory (with the intent that such agreement will provide for a co-promotion role for POZEN in the marketing and promotion of the applicable
Licensed Product corresponding to the role for any Third Party described by Xcel in its notice to POZEN (and in accordance with the Marketing Plan then in effect), although Xcel will set the sales price, [CONFIDENTIAL TREATMENT REQUESTED],
and book all sales revenue). If the Parties are not able to agree upon such a co-promotion agreement within such 60-day period, then Xcel may seek to have a Third Party perform the co-promotion arrangement; provided, however, that Xcel may
not offer to any such Third Party terms which are, in the aggregate, more beneficial to such Third Party than the last offer made by Xcel to POZEN during the above-referenced 60-day negotiating period without providing POZEN with a period of at
least 10 days to accept any improved terms which Xcel intends to offer to any Third Party. 
  
 5.3.4 Notwithstanding anything in this Agreement to the contrary, (a) Xcel may enter into a co-promotion arrangement with a Third
Party for Licensed Products only if such arrangement: [CONFIDENTIAL TREATMENT REQUESTED], and (b) subject to the limitations set forth in subsection (a) above, Xcel is not required to first offer co-promotion rights to POZEN pursuant to
Section 5.3.3 with respect to a proposed co-promotion arrangement with a Third Party pursuant to which [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 5.4 Branding; Trademarks; Trade Dress; Logos. 
  
 5.4.1 Following the Effective Date, the Parties will work together to select a Product Trademark for the Initial Licensed Product.
In the event that the Parties have not agreed upon such a Product Trademark by October 30, 2003, then [CONFIDENTIAL TREATMENT REQUESTED] may select a Product Trademark for the Initial Licensed Product, subject to the approval of
[CONFIDENTIAL TREATMENT REQUESTED]. Xcel will thereafter use such Product Trademark in the Commercialization of the Initial Licensed Product. 
  
 5.4.2 Prior to Marketing Approval for any Licensed Product other than the Initial Licensed Product, the Parties will work together
to determine a Product Trademark for such Licensed Product. In the event that the Parties have not agreed upon such a Product Trademark within 60 days of Xcel’s delivery to POZEN of notice that a Product Trademark is required for such Licensed
Product in order for Xcel properly to commence pre-launch market development activities in anticipation of 
  

 19 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 Marketing Approval for such Licensed Product, then [CONFIDENTIAL TREATMENT REQUESTED] may select a Product Trademark
for the Licensed Product, subject to the approval of [CONFIDENTIAL TREATMENT REQUESTED]. Xcel will thereafter use such Product Trademark in the Commercialization of such Licensed Product. 
  
 5.4.3 At the request of POZEN, Xcel will, to the
extent permitted by law (including applicable FDA regulations), include any POZEN Trademark designated by POZEN (the “Designated POZEN Trademark”) on any joint press releases and seminar and conference posters and presentations
regarding any Licensed Product. Prior to any such use, Xcel will provide POZEN with an opportunity to review and comment upon the planned use of the Designated POZEN Trademark. In addition, any such use of the Designated POZEN Trademark will comply
with the provisions of Section 5.4.5. 
  
 5.4.4
POZEN will be the sole owner of the Product Trademarks. In consideration for the licenses granted by POZEN to Xcel for Product Trademarks under this Agreement, Xcel will pay to POZEN a royalty of [CONFIDENTIAL TREATMENT REQUESTED] for the
duration of the use of any such Product Trademarks by Xcel [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 5.4.5 In connection with the use of any Product Trademarks or any Designated POZEN Trademark, Xcel will (a) place the appropriate
trademark symbol, such as TM or ®, adjacent to any
Product Trademark or Designated POZEN Trademark and (b) not use such Product Trademark or Designated POZEN Trademark as an adjective or in the plural or possessive form. Xcel recognizes and agrees that such steps are necessary to protect and enhance
the value and goodwill of the Product Trademarks or any Designated POZEN Trademark. POZEN will have the right to review any Product Promotional Materials and any labels or packaging materials prepared by or for Xcel that bear any Product Trademarks
or any Designated POZEN Trademark in order to confirm that such trademarks are being used in all material respects in accordance with the terms of this Section 5.4.5. Upon written notice of non-compliance from POZEN to Xcel, Xcel will modify the
applicable Product Promotional Materials, labels, or packaging materials to make them comply with the terms of this Section 5.4.5. 
  
 5.4.6 POZEN reserves all rights in the Product Trademarks and the POZEN Trademarks not expressly granted to Xcel in this Agreement.
Xcel acknowledges POZEN’s exclusive right, title and interest in and to the Product Trademarks and POZEN Trademarks and acknowledges that nothing herein will be construed to accord to Xcel any rights in such trademarks except as expressly
provided herein. Xcel further acknowledges that its use of the Product Trademarks and POZEN Trademarks will not create in Xcel any right, title or interest in such trademarks, and that all use of such trademarks and the goodwill generated thereby
will inure solely to the benefit of POZEN. Upon any termination of this Agreement, Xcel hereby agrees not to [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 5.4.7 Except as expressly permitted herein, POZEN will not use, or knowingly permit any Third Party to use, any Product Trademarks
except in connection with the development, manufacture and Commercialization outside of the Territory of Foreign Licensed 
  

 20 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 Products, and will impose on all direct or indirect licensees of Foreign Licensed Products using the Product Trademarks
obligations similar to those imposed on Xcel pursuant to Section 5.4.5. 
  
 6.    DILIGENCE 
  
 6.1
General Diligence Obligations. Xcel will, during the Term, exercise Commercially Reasonable Efforts to Commercialize the Licensed Products in the Field in the Territory following receipt of Marketing Approval. 
  
 6.2 Minimum Launch Diligence Obligations. Without limiting the
diligence obligations of Section 6.1 above, Xcel will conduct the Commercial Launch of each Licensed Product in the Territory as soon as reasonably possible after receipt of Marketing Approval for such Licensed Product, but in no event later than
[CONFIDENTIAL TREATMENT REQUESTED]. Without limiting the diligence obligations of Section 6.1 above, Xcel will conduct the Commercial Launch of the Initial Licensed Product in the Territory before conducting the Commercial Launch of any other
Licensed Product in the Territory. 
  
 6.3 Minimum
Commercialization Diligence Obligations. Without limiting the diligence obligations of Section 6.1 above, during the [CONFIDENTIAL TREATMENT REQUESTED] following the First Commercial Sale Date for the Initial Licensed Product, Xcel will:
[CONFIDENTIAL TREATMENT REQUESTED]. 
  
 6.4 Lack
of Diligence. Any material failure by Xcel to fulfill a diligence obligation set forth in this Section 6 will be deemed a material breach of this Agreement. Xcel’s fulfillment of the diligence obligations set forth in Sections 6.2 and 6.3
will be taken into account when determining whether Xcel has fulfilled its obligations set forth in Section 6.1, but will not be considered conclusive proof that such obligations have also been fulfilled. 
  
 7.    LICENSES AND OTHER RIGHTS 
  
 7.1 Grants to Xcel. Subject to the terms and conditions set
forth in this Agreement, POZEN hereby grants to Xcel: 
  
 7.1.1 An exclusive license (even as to POZEN) under the Licensed Technology to Commercialize Royalty Products in the Field in the Territory; 
  
 7.1.2 Except as provided in Section 4.1.2, a worldwide, non-exclusive license under the Licensed Technology to make or have made
Royalty Products for Commercialization in the Field in the Territory; 
  
 7.1.3 A non-exclusive license under the Licensed Technology to develop Royalty Products in the Territory; 
  
 7.1.4 An exclusive license (even as to POZEN) to use the Product Trademarks in connection with the Commercialization of Licensed
Products in the Territory; and 
  
 7.1.5 A
non-exclusive license to use Designated POZEN Trademarks pursuant to Section 5.4.3. 
  

 21 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 7.2 Sublicenses by Xcel. Except for any co-promotion arrangements entered into by Xcel with any Third Parties
in accordance with Section 5.3, the licenses granted in Sections 7.1.1, 7.1.4 and 7.1.5 are not sublicensable by Xcel. The licenses granted to Xcel in Section 7.1 in connection with any co-promotion arrangement entered into in accordance with
Section 5.3, and the licenses granted to Xcel in Section in 7.1.2 and 7.1.3, are sublicensable by Xcel. Xcel will impose on any sublicensee of Xcel’s rights such obligations as may be necessary for (a) Xcel to be able to perform its obligations
under this Agreement and (b) the required performance of such sublicensee to be in compliance with the requirements of this Agreement. 
  
 7.3 Grants to POZEN. Subject to the terms and conditions set forth in this Agreement, Xcel hereby grants to POZEN: 
  
 7.3.1 An exclusive license (even as to Xcel) under the
Xcel Technology, but solely to Commercialize in the Field outside the Territory any Foreign Licensed Products; 
  
 7.3.2 A non-exclusive, worldwide license under the Xcel Technology, but solely to develop, make or have made for Commercialization
in the Field outside the Territory any Foreign Licensed Products; and 
  
 7.3.3 The non-exclusive right to use and reference the filed or approved POZEN NDA and the Autoinjector SNDA (and, if applicable, the NDA for any Licensed Product other than the Initial Licensed Product) and
any data and information contained in such filed or approved POZEN NDA or Autoinjector SNDA (or, if applicable, such other NDA) for (a) the development, registration and Commercialization of products other than Royalty Products inside the Territory,
(b) the development of Foreign Licensed Products inside or outside the Territory, and (c) the registration and Commercialization of Foreign Licensed Products outside the Territory. 
  
 7.4 Sublicenses by POZEN. The licenses and rights granted in Section 7.3 are sublicensable by POZEN without
the prior written consent of Xcel, but only if the following conditions are met: (a) any sublicensee is, with respect to any territory at issue, concurrently receiving from POZEN a license under one or more Patents Controlled by POZEN to
Commercialize Foreign Licensed Products in the Field in such territory; (b) such license is granted with the same scope of exclusivity and under the same termination and expiration terms as the sublicenses granted under the licenses and rights
granted in Section 7.3; (c) such sublicensee is licensing to POZEN [CONFIDENTIAL TREATMENT REQUESTED] owned or Controlled by such sublicensee that are [CONFIDENTIAL TREATMENT REQUESTED] for the development, manufacture, having
manufactured or Commercialization of any Licensed Products in the Field in the Territory, which license to POZEN is to be sublicensable (and deemed sublicensed) to Xcel in accordance with the terms of the licenses granted in Section 7.1; and (d)
Xcel receives prior written notice of any such sublicense. Any sublicensee in an arrangement meeting the requirements of the foregoing clauses (a), (b), (c) and (d) is herein referred to as a “Reciprocating Licensee.”
Notwithstanding the foregoing, POZEN will have the right to sublicense to any of its licensees its right of use and reference of the filed or approved POZEN NDA and the Autoinjector SNDA and any data and information contained in such filed or
approved POZEN NDA or Autoinjector SNDA for (a) the development, registration and Commercialization of products other than Royalty Products inside the Territory, (b) the 
  

 22 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 development of Foreign Licensed Products inside and outside the Territory and (c) the registration and Commercialization of Foreign Licensed
Products outside the Territory. 
  
 7.5 Negative Covenants.

  
 7.5.1 Xcel covenants and agrees
that it will not (a) use or practice the Licensed Technology or the Product Trademarks, except as expressly permitted by this Agreement, (b) use or practice the Licensed Technology for the purposes of developing, distributing or Commercializing any
Licensed Product for non-prescription sale, (c) apply for any Regulatory Approval that would allow the over-the-counter sale of any Licensed Product, (d) sell any Licensed Product to patients without a prescription therefore, (e) sell, or knowingly
permit any Third Party to sell, any Licensed Product for export, distribution, resale or use outside the Territory or (f) [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 7.5.2 POZEN covenants and agrees that it will not (a) use or practice the Xcel Technology, except as
expressly permitted by this Agreement, (b) sell, or knowingly permit any Third Party to sell, any Royalty Product for import, distribution, resale or use in the Territory, (c) conduct any Commercialization, or knowingly permit any Third Party to
conduct any Commercialization, of any Royalty Product in the Territory, (d) [CONFIDENTIAL TREATMENT REQUESTED], or, (e) except for Third Parties which are obligated to POZEN to maintain confidentiality of the same in accordance with
arrangements which are at least as protective as the provisions set forth in Section 13 or as expressly contemplated by this Agreement, disclose any Licensed Technology, or any Confidential Information of POZEN relating to any Licensed Technology,
to any Third Party. 
  
 7.5.3
[CONFIDENTIAL TREATMENT REQUESTED]. 
  
 7.5.4 [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 7.5.5 Except for the rights specifically granted in this Agreement, each Party expressly reserves (a) all rights owned or controlled by it, including as to all products and intellectual property rights, and (b)
the right to utilize, and to allow Third Parties to utilize, such products and intellectual property rights in any manner not inconsistent with the terms of this Agreement. 
  
 7.6 Upstream Licensors of Future Technology. 
  
 7.6.1 With respect to any intellectual property rights included in any POZEN Improvement or POZEN
Patent acquired by or licensed to POZEN from a Third Party after the Effective Date and practiced by Xcel in the development, manufacture or Commercialization of any Royalty Product other than the Initial Licensed Product as envisaged as of the
Effective Date, such intellectual property rights will not be included in the licenses granted under Section 7.1 unless Xcel agrees to pay to POZEN any amounts that may become due to any such Third Party licensor as a result of the practice of such
intellectual property rights by Xcel pursuant to the licenses granted under Section 7.1, with such payment to be made no later than 10 days prior to the date POZEN’s payment is due to such Third Party licensor. POZEN will provide written notice
to Xcel describing any payment 
  

 23 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 obligations associated with the practice of any such intellectual property rights at the time POZEN discloses such
intellectual property rights or related information or technology to Xcel. 
  
 7.6.2 With respect to any intellectual property rights included in any Xcel Improvement or Xcel Patent acquired by or licensed to Xcel from a Third Party after the Effective Date and practiced by POZEN or any
Reciprocating Licensee in the development, manufacture or Commercialization of any Licensed Product or Foreign Licensed Product other than the Initial Licensed Product as envisaged as of the Effective Date, such intellectual property rights will not
be included in the licenses granted under Section 7.3 unless POZEN agrees to pay to Xcel any amounts that may become due to any such Third Party licensor as a result of the practice of such intellectual property rights by POZEN or any such
Reciprocating Licensee pursuant to the licenses granted under Section 7.3, with such payment to be made no later than 10 days prior to the date Xcel’s payment is due to such Third Party licensor. Xcel will provide written notice to POZEN
describing any payment obligations associated with the practice of any such intellectual property rights at the time Xcel discloses such intellectual property rights or related information or technology to POZEN. 
  
 8. COMPENSATION 
  
 8.1 License Fees. Xcel will pay to POZEN a non-refundable, non-creditable license fee of US$2,000,000 on the
Effective Date. 
  
 8.2 Milestones. Subject to the
terms and conditions of this Agreement, Xcel will make the following non-refundable, non-creditable payments to POZEN in the amounts set forth below within 15 days of the occurrence of the related event: 
  

	Milestone Event	  	Milestone
Payment
	 (1) [CONFIDENTIAL TREATMENT REQUESTED]
	  	[CONFIDENTIAL TREATMENT REQUESTED]
		
	 (2) [CONFIDENTIAL TREATMENT REQUESTED]
	  	[CONFIDENTIAL TREATMENT REQUESTED]
		
	 (3) [CONFIDENTIAL TREATMENT REQUESTED]
	  	[CONFIDENTIAL TREATMENT REQUESTED]

  
 8.3 Royalties.

  
 8.3.1 Royalty Rate. Subject
to the terms and conditions of this Agreement, Xcel will pay to POZEN a royalty, based on aggregate Net Sales of Royalty Products in the 
  

 24 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 Territory for each calendar year during the Royalty Term, as follows: [CONFIDENTIAL TREATMENT REQUESTED]. 

 
 8.3.2 Royalty Term. Royalties due under this
Section 8.3 will be payable with respect to all Royalty Products for the period (the “Royalty Term”) commencing on the First Commercial Sale Date of the first Licensed Product and ending on [CONFIDENTIAL TREATMENT REQUESTED].

  
 8.4 Offsets. 
  
 8.4.1 Subject to the terms of this Section 8.4, Xcel
may offset up to [CONFIDENTIAL TREATMENT REQUESTED] of any Third Party Payments against any of the payments required to be made by Xcel in Section 8.2, or any of the payments made by Xcel in Section 8.3 based on Net Sales of the Initial
Licensed Product, the Autoinjector Presentation or DHE-45. 
  
 8.4.2 Notwithstanding any provision herein to the contrary, the amount of any offsets taken by Xcel pursuant to Sections 3.1.6, 3.2.6, and 8.4.1, in the aggregate, will be subject to a maximum, as to any
specific payment, of [CONFIDENTIAL TREATMENT REQUESTED] of the amount payable by Xcel under this Agreement prior to application of the offset(s), although any amounts not offset with respect to any specific payment may be carried forward for
offset against any other payment. 
  
 8.4.3
Notwithstanding any provision herein to the contrary, Xcel will not be entitled to take any offset pursuant to Sections 3.1.6, 3.2.6, or 8.4.1 from royalties due for Net Sales of a Licensed Product during such time as [CONFIDENTIAL TREATMENT
REQUESTED]. 
  
 8.5 [CONFIDENTIAL TREATMENT
REQUESTED]. [CONFIDENTIAL TREATMENT REQUESTED] will be calculated on a calendar quarterly basis. [CONFIDENTIAL TREATMENT REQUESTED], as documented by Xcel pursuant to this Section 8.5. Xcel will notify POZEN in writing promptly
upon its determination that [CONFIDENTIAL TREATMENT REQUESTED] with respect to a calendar quarter and will provide with such notice such information and documentation as is reasonably necessary for POZEN to confirm the accuracy of such
determination. 
  
 8.6 Payments and Reports.
Payments required to be made by Xcel in Section 8.3 will be made on a calendar quarter basis (calculated as the amount owed for the then current calendar year through the end of such quarter less any amounts previously paid in respect of such year),
with such payments to be (a) made within [CONFIDENTIAL TREATMENT REQUESTED] after the end of the applicable calendar quarter and (b) accompanied by a written report setting forth in reasonable detail the calculation of the amount of the
payment made; provided, however, that (i) within [CONFIDENTIAL TREATMENT REQUESTED] of the end of each calendar quarter, Xcel will provide POZEN with a report stating the number of units of each Royalty Product sold by Xcel during the
relevant payment period, the amount of gross sales, any deductions taken in the calculation of Net Sales, and the royalty payable pursuant to Section 8.3 in respect of such quarter, and (ii) if any information bearing on the 

  

 25 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 
amount of any royalty payment pursuant to Section 8.3 [CONFIDENTIAL TREATMENT REQUESTED] becomes known following the making of any such payment (or
the delivery of any related report), adjustments will be made in subsequent payments (i.e., to “true-up” the aggregate amount of royalty payments made) and the reports made with respect to such subsequent payments will indicate the basis
and amount of any such adjustments. 
  
 8.7 Payment
Method; Currency. Xcel will make all payments under this Agreement in United States dollars by wire transfer in immediately available funds to an account designated by POZEN. Any payments or portions thereof due hereunder that are not paid on
the date such payments are due under this Agreement will bear interest at a per annum rate equal to the lesser of (a) the prime rate as published in The Wall Street Journal, Eastern Edition, on the first day of each calendar quarter in which such
payments are overdue, [CONFIDENTIAL TREATMENT REQUESTED], and (b) the maximum rate permitted by law, calculated on the number of days such payment is delinquent. 
  
 8.8 Taxes. Xcel will have the right to withhold taxes in the event that authorities in the Territory require
the withholding of taxes on amounts paid hereunder to POZEN. Such taxes will be deducted by Xcel from such payment and will be paid by Xcel to the proper taxing authority on behalf of POZEN. Xcel will promptly secure and send to POZEN proof
evidencing payment of such taxes withheld and paid by Xcel for the benefit of POZEN. Xcel will assist POZEN in claiming exemption from such deductions or withholdings under any applicable tax treaty by providing such documentation as may be
reasonably required by POZEN to claim such exemption. 
  
 8.9
Audit Rights; Adjustments. 
  
 8.9.1
Each Party (the “Audited Party”) will permit an independent certified public accountant designated by the other Party (the “Auditing Party”) and reasonably acceptable to the Audited Party (the
“Auditor”) to have access to the Audited Party’s records and books, insofar as the same relate to any of the payments to be made under the provisions of this Agreement, for the sole purpose of determining the accuracy of the
amounts reported and actually paid or otherwise payable under the terms of this Agreement (the “Audit”); provided, however, that (i) any Audit will cover a period not to exceed three years immediately preceding such Audit, (ii) each
period may be the subject of only one Audit, (iii) the Auditor will agree to (x) execute and be bound by a confidentiality agreement in customary form and (y) reveal only the results of the Audit (the “Auditor’s Results”) to
the Auditing Party (and not, for example, the information reviewed with respect thereto), (iv) the Auditing Party will bear all costs and expenses in connection with any Audit, (v) any Audit will be performed during a mutually determined period upon
at least 30 calendar days’ prior written notice during regular business hours, and (vi) Audits will not be requested by any one Party to occur more than once in each calendar year during the Term and once following expiration or termination of
this Agreement. 
  
 8.9.2 Where the Audit
relates to royalty payments made by Xcel under Section 8.3: (a) if the Auditor’s Results determine that any royalty payment(s) at issue have been overstated, then POZEN will repay to the Xcel the amount of any resulting overpayment within

  

 26 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 30 days after receipt of the Auditor’s Results, after deducting the reasonable costs and expenses incurred by POZEN in
connection with the Audit; and (b) if the Auditor’s Results determine that any royalty payment(s) at issue have been understated, then (i) Xcel will pay to POZEN the amount of any resulting underpayment within 30 days after receipt of the
Auditor’s Results together with interest on any underpayment from the date originally due, calculated at a per annum rate equal to the prime rate as published in The Wall Street Journal, Eastern Edition, on the first day of each calendar
quarter in which such underpayment occurs, [CONFIDENTIAL TREATMENT REQUESTED], and, (ii) where the underpayment of any royalty payment(s) at issue is greater than [CONFIDENTIAL TREATMENT REQUESTED] of the amount of such royalty
payment(s) actually due under the terms of this Agreement, then Xcel will reimburse POZEN for the reasonable costs and expenses incurred by POZEN in connection with the Audit. 
  
 8.9.3 Where the Audit relates to payments made by Xcel to POZEN other than royalty payments under
Section 8.3 (e.g., payments for Development Fees pursuant to a Study Plan as contemplated by Section 3.3.3 or payments for Manufacturing Liaison Fees as contemplated by Section 4.4): (a) if the Auditor’s Results determine that any payment(s) at
issue have been overstated, then (i) POZEN will repay to Xcel the amount of any resulting overpayment within 30 days after receipt of the Auditor’s Results together with interest on any overpayment from the date originally due, calculated at a
per annum rate equal to the prime rate as published in The Wall Street Journal, Eastern Edition, on the first day of each calendar quarter in which such overpayment occurs, [CONFIDENTIAL TREATMENT REQUESTED], and, (ii) where the overpayment
of any payment(s) at issue is greater than [CONFIDENTIAL TREATMENT REQUESTED] of the amount of such payment(s) actually due under the terms of this Agreement, then POZEN will reimburse Xcel for the reasonable costs and expenses incurred by
Xcel in connection with the Audit; and (b) if the Auditor’s Results determine that any underpayment has occurred, then Xcel will pay to POZEN the amount of any resulting underpayment within 30 days after receipt of the Auditor’s Results,
after deducting the reasonable costs and expenses incurred by Xcel in connection with the Audit. 
  
 8.9.4 In connection with any audits of POZEN’s books and records conducted on behalf of [CONFIDENTIAL TREATMENT
REQUESTED] or its Affiliates pursuant to the [CONFIDENTIAL TREATMENT REQUESTED], POZEN will have the right to make available to [CONFIDENTIAL TREATMENT REQUESTED] and its Affiliates any Auditor’s Results with respect to
Xcel’s books and records insofar as the same address matters affecting [CONFIDENTIAL TREATMENT REQUESTED] under [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 9. INTELLECTUAL PROPERTY 
  
 9.1 Ownership. All right, title and interest in and to the Licensed Technology, POZEN Trademarks, and Product Trademarks will remain
exclusively with POZEN, subject only to the licenses granted to Xcel under this Agreement. All right, title and interest in and to the Xcel Technology will remain exclusively with Xcel, subject only to the licenses granted to POZEN under this
Agreement. 
  

 27 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 9.2 Patent and Trademark Filing, Prosecution and Maintenance. 
  
 9.2.1 As between the Parties, POZEN will have the
first right, using counsel of its choice, to prepare, file, prosecute, maintain and obtain extensions of all POZEN Patents and Product Trademarks in the Territory, subject to any obligations POZEN may have to Third Parties with respect to POZEN
Patents that are licensed by such Third Party to POZEN. If POZEN undertakes any such activities, then (a) POZEN will bear the costs relating to such activities, (b) POZEN will consider in good faith the interests of Xcel in so doing and (c) POZEN
will use Commercially Reasonable Efforts to obtain the strongest commercially reasonable patent or trademark protection (under the circumstances and, as to patent protection, for applications of each POZEN Patent for Royalty Products). POZEN will
use reasonable efforts to solicit Xcel’s advice and review of the nature and text of POZEN Patents, applications for Product Trademarks and material prosecution matters related thereto in reasonably sufficient time prior to filing thereof or
action thereon, and POZEN will consider in good faith Xcel’s reasonable comments related thereto. 
  
 9.2.2 If POZEN, prior or subsequent to filing any POZEN Patent owned by POZEN or any application for a Product Trademark, elects
not to file, prosecute or maintain such POZEN Patent or such application for a Product Trademark, then POZEN will give Xcel written notice thereof within a reasonable period prior to allowing such POZEN Patent or such application to lapse or become
abandoned or unenforceable, and Xcel will thereafter have the right, at its expense, to assume title and ownership to, and to prepare, file, prosecute and maintain, such POZEN Patent or such application for a Product Trademark. 
  
 9.2.3 As between the Parties, Xcel will have the first
right, using counsel of its choice, to prepare, file, prosecute, maintain and obtain extensions of all Xcel Patents, subject to any obligations Xcel may have to Third Parties with respect to Xcel Patents that are licensed by such Third Party to
Xcel. If Xcel undertakes any such activities, then (i) Xcel will bear the costs relating to such activities, (ii) Xcel will consider in good faith, to the extent that any such Xcel Patent relates to any Licensed Product, the interests of POZEN in so
doing and (iii) Xcel will use Commercially Reasonable Efforts to obtain the strongest commercially reasonable patent or trademark protection (under the circumstances and, as to patent protection to the extent that any such Xcel Patent relates to any
Licensed Product, for applications of such Xcel Patent for Licensed Products). To the extent that any such Xcel Patent relates to any Licensed Product, Xcel will use reasonable efforts to solicit POZEN’s advice and review of the nature and text
of such Xcel Patent and material prosecution matters related thereto in reasonably sufficient time prior to filing thereof or action thereon, and Xcel will consider in good faith POZEN’s reasonable comments related thereto. 
  
 9.2.4 If Xcel, prior or subsequent to filing any Xcel
Patent owned by Xcel, elects not to file, prosecute or maintain such Xcel Patent, then Xcel will give POZEN written notice thereof within a reasonable period prior to allowing such Xcel Patent to lapse or become abandoned or unenforceable, and POZEN
will thereafter have the right, at its expense, to assume title and ownership to, and to prepare, file, prosecute and maintain, such Xcel Patent. 
  

 28 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 9.3 Improvements. 
  
 9.3.1 All Improvements made jointly by employees of POZEN and Xcel (or their Affiliates or Third Party contractors), and all joint
Know-How, will be owned jointly by the Parties and each Party will retain full ownership under any Patents resulting therefrom, with full ownership rights in any field and, subject to the licenses granted in Section 7, the right to sublicense
without the consent of the other Party, without obligation to account to the other Party. The laws of the United States with respect to joint ownership of inventions will apply in all jurisdictions giving force and effect to this Agreement.

  
 9.3.2 POZEN will disclose any POZEN
Improvements to Xcel, and Xcel will disclose any Xcel Improvements to POZEN, in each case promptly after the relevant Party recognizes that any Improvement falls within the definitions set forth in Section 1.44 or 1.64, respectively. Further, each
Party will disclose to the other Party all Improvements made jointly by the disclosing Party and the other Party, or its or their Affiliates or Third Party contractors. The disclosing Party will provide such information in reasonable detail,
sufficient to permit an understanding of the nature of the Improvements by a practitioner reasonably skilled in the relevant technical or scientific area. 
  
 9.3.3 Upon disclosure of a jointly owned Improvement, the Parties will discuss, in good faith, the most appropriate course of
action for the protection of such Improvement. Unless the Parties agree that one Party will assume responsibility for filing and prosecution of any Patents with respect to such Improvement, the Parties will retain joint patent counsel for such
activities (and will share the costs relating thereto equally). 
  
 9.4 Enforcement Rights. 
  
 9.4.1 Notification of Infringement. If either Party learns of any misappropriation or any infringement or threatened infringement of the Licensed Technology, the Xcel Technology or the Product Trademarks in the Field and in
the Territory (the “Product Rights”), such Party will promptly notify the other Party and will provide such other Party with all available evidence of such misappropriation or infringement. 
  
 9.4.2 Enforcement of Patents and Product Rights in
the Territory. 
  
 (a) Xcel will have
the first right, but not the obligation, to institute, prosecute and control at its own expense any action or proceeding with respect to infringement or misappropriation of Product Rights, by counsel of its own choice, and will consult with POZEN on
any actions that Xcel proposes to take in such action or proceeding. POZEN will have the right, at its own expense, to be represented in any such action by counsel of its own choice. 
  
 (b) If Xcel fails to bring an action or proceeding or otherwise take appropriate action in
Xcel’s discretion to abate such infringement or misappropriation in the Field and in the Territory within a period of 90 days of written notice by POZEN to Xcel requesting such action, POZEN will have the right, but not the obligation, to bring
and control, by counsel of its own choice, any such infringement or misappropriation action or proceeding; provided, however, that POZEN will not 
  

 29 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 be entitled to bring any such action or proceeding if [CONFIDENTIAL TREATMENT REQUESTED]. Xcel will cooperate with
POZEN in any such action or proceeding brought by POZEN against a Third Party, and will have the right to consult with POZEN and to participate in and be represented by independent counsel in such litigation at its own expense. 
  
 (c) If a Party brings any action or proceeding under
this Section 9.4.2, the other Party agrees, at the request and expense of the first Party, to be joined as a party plaintiff to the extent necessary to prosecute the action or proceeding and to give the first Party reasonable assistance and
authority to file and prosecute the suit, including reasonable access to the inventors and records related to such action which are under the control of such other Party. 
  
 9.4.3 Settlement with a Third Party. The Party that controls the prosecution of a given action
under this Section 9.4 will also have the right to control settlement of such action; provided, however, that no settlement will be entered into concerning or affecting the validity or enforceability of (i) the Licensed Technology or the
Product Trademarks without the written consent of POZEN or (ii) the Xcel Technology without the written consent of Xcel. 
  
 9.4.4 Enforcement Costs and Awards. Each Party will bear its own costs incurred in connection with an action or proceeding
brought by a Party pursuant to Section 9.4.2. In the case of an action or proceeding initiated by Xcel, any resulting damage award, after reimbursement of each Party’s expenses, will be deemed Net Sales of Xcel in the Territory and will be
subject to the royalty payment obligations set forth in Section 8.3. In the case of an action or proceeding initiated by POZEN, any resulting damage award, after reimbursement of each Party’s expenses, will be shared between the Parties
proportionate to each Party’s share of costs and expenses incurred in connection with such action or proceeding. 
  
 9.5 Defense and Settlement of Third Party Claims. 
  
 9.5.1 Defense. If a Third Party asserts that a patent, trade secret, or other intangible right owned or exclusively licensed
by it is infringed or misappropriated by the manufacture, use, sale, or offer for sale of any Licensed Product in the Field in the Territory during the Term, Xcel will establish a plan for a common defense and manage such common defense plan,
subject to Section 9.5.2 below. Except as provided in Section 9.5.2, each Party will bear its own costs incurred in connection with any such defense, and POZEN will give Xcel reasonable assistance and authority to defend, including reasonable access
to the inventors and records relating to such action which are under the control of POZEN. 
  
 9.5.2 Settlement and Damages. Xcel will control settlement of any claim described in Section 9.5.1 above; provided, however,
that no settlement will be entered into concerning or affecting the validity or enforceability of the Licensed Technology or the Product Trademarks without the written consent of POZEN. Xcel will be responsible for [CONFIDENTIAL TREATMENT
REQUESTED]. 
  
 9.6 Consequence of Patent
Challenge. If Xcel challenges the validity or enforceability of any of the POZEN Patents by any opposition, reexamination request, action for declaratory judgment, nullity action, interference or other attack upon the validity, title or
enforceability thereof before any governmental agency, court or other similar adjudicative forum 
  

 30 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 (any such proceeding, a “Patent Challenge”), such Patent Challenge will be deemed to be a material breach of this Agreement
and POZEN will have the right to terminate this Agreement as provided in Section 14.2 or to terminate all licenses granted under any of the POZEN Patents subject to such Patent Challenge. 
  
 10. REPRESENTATIONS AND WARRANTIES 
  
 10.1 Mutual Representations and Warranties. Each of the Parties hereby represents and warrants to the other Party as follows: 
  
 10.1.1 Such Party is a corporation duly organized,
validly existing and in good standing under the laws of the state in which it is incorporated; 
  
 10.1.2 This Agreement is a legal and valid obligation binding upon such Party and enforceable in accordance with its terms, and the
execution, delivery and performance of the Agreement by such Party does not conflict with any agreement, instrument or understanding, oral or written, to which it is a Party or by which it is bound, nor violate any law or regulation of any court,
governmental body or administrative or other agency having jurisdiction over it; 
  
 10.1.3 Such Party has the full corporate power and authority to enter into this Agreement and to carry out the obligations
contemplated hereby; 
  
 10.1.4 To the best
of such Party’s knowledge, neither it, nor any of its employees, officers, subcontractors or consultants who will perform any activities under this Agreement (i) has been debarred or convicted of a crime for which an entity or person could be
debarred under 21 U.S.C. Section 335a, or (ii) is under indictment for a crime for which a person or entity could be debarred under 21 U.S.C. Section 335a; and 
  

10.1.5 It has taken all necessary corporate action on its part to authorize the execution and delivery of this Agreement.

  
 10.2 POZEN Representations and Warranties. POZEN
hereby represents and warrants to Xcel as follows: 
  
 10.2.1 POZEN has not, and during the term of the Agreement will not, [CONFIDENTIAL TREATMENT REQUESTED]; 
  
 10.2.2 POZEN has [CONFIDENTIAL TREATMENT REQUESTED]; 
  
 10.2.3 POZEN has [CONFIDENTIAL TREATMENT REQUESTED]; 
  
 10.2.4 To the Knowledge of POZEN, without
[CONFIDENTIAL TREATMENT REQUESTED]; 
  
 10.2.5 As of the Effective Date, POZEN has not [CONFIDENTIAL TREATMENT REQUESTED]; 
  

 31 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 10.2.6 To the Knowledge of POZEN, each person [CONFIDENTIAL TREATMENT REQUESTED]; 

 
 10.2.7 To the Knowledge of POZEN, none of the
[CONFIDENTIAL TREATMENT REQUESTED]; 
  
 10.2.8 To the Knowledge of POZEN, without [CONFIDENTIAL TREATMENT REQUESTED]; 
  
 10.2.9 As of the Effective Date, the [CONFIDENTIAL TREATMENT REQUESTED]; 
  
 10.2.10 As of the Effective Date, POZEN has not
[CONFIDENTIAL TREATMENT REQUESTED]; 
  
 10.2.11 To the Knowledge of POZEN, each [CONFIDENTIAL TREATMENT REQUESTED]; 
  
 10.2.12 As of the Effective Date, all [CONFIDENTIAL TREATMENT REQUESTED]; 
  
 10.2.13 As of the Effective Date, (a) POZEN has
[CONFIDENTIAL TREATMENT REQUESTED], (b) to the Knowledge of POZEN, POZEN has [CONFIDENTIAL TREATMENT REQUESTED], (c) to the Knowledge of POZEN, POZEN has [CONFIDENTIAL TREATMENT REQUESTED], and (d) to the Knowledge of POZEN,
[CONFIDENTIAL TREATMENT REQUESTED]; 
  
 10.2.14 With respect to the Licensed Technology and any Licensed Product in the Territory, (a) to the Knowledge of POZEN, [CONFIDENTIAL TREATMENT REQUESTED] and (b) as of the Effective Date, there is [CONFIDENTIAL TREATMENT
REQUESTED]; 
  
 10.2.15 As of the
Effective Date, (a) POZEN has [CONFIDENTIAL TREATMENT REQUESTED], (b) [CONFIDENTIAL TREATMENT REQUESTED], and (c) POZEN has [CONFIDENTIAL TREATMENT REQUESTED]; 
  
 10.2.16 [CONFIDENTIAL TREATMENT REQUESTED]; 
  
 10.2.17 To the Knowledge of POZEN, (a) POZEN has
[CONFIDENTIAL TREATMENT REQUESTED], and (b) POZEN has received no notice from [CONFIDENTIAL TREATMENT REQUESTED]; 
  
 10.2.18 As of the Effective Date, there is [CONFIDENTIAL TREATMENT REQUESTED] in connection with (i) any of the Licensed
Technology, (ii) any Licensed Product or (iii) POZEN’s performance under this Agreement; and POZEN is not subject [CONFIDENTIAL TREATMENT REQUESTED] under this Agreement; and 
  

 32 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 10.2.19 As of the Effective Date POZEN has [CONFIDENTIAL TREATMENT REQUESTED] that either (i)
would be [CONFIDENTIAL TREATMENT REQUESTED] or (ii) would be [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 10.3 Limitation of Warranty. EXCEPT AS EXPRESSLY STATED IN THIS AGREEMENT, (i) NEITHER PARTY MAKES ANY REPRESENTATION OR WARRANTY AND (ii)
EACH PARTY EXPRESSLY DISCLAIMS ALL IMPLIED WARRANTIES, INCLUDING WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR NON-INFRINGEMENT, WITH RESPECT TO ANY MATERIALS, INFORMATION, SERVICES, OR LICENSES PROVIDED TO THE OTHER PARTY
PURSUANT TO THIS AGREEMENT. 
  
 10.4 Performance by
Affiliates. The Parties recognize that each Party may elect to perform some or all of its obligations under this Agreement through Affiliates; provided, however, that each Party will remain responsible for the performance by such
Affiliates and will cause any such Affiliates to accept in writing to be bound by the terms of this Agreement, and to comply with the provisions of this Agreement in connection with such performance (such Affiliates being “Performing
Affiliates”). Acts or omissions of any Performing Affiliates or Controlled Affiliates of a Party that, if performed by such Party, would constitute a breach of this Agreement, will be deemed a breach of this Agreement by such Party. Each
Party hereby expressly waives any requirement that the other Party exhaust any right, power or remedy, or proceed against an Affiliate, for any obligation or performance hereunder prior to proceeding directly against such Party. 
  
 11. INDEMNIFICATION 
  
 11.1 Indemnification by Xcel. Except to the extent of POZEN’s indemnification obligation as set forth in
Section 11.2 below, and except to the extent caused by POZEN’s or its Affiliates’ negligent, reckless or willful acts or omissions, Xcel will indemnify, defend and hold POZEN and its directors, officers, employees, agents and Affiliates
harmless from and against any liabilities, damages, costs or expenses, including reasonable attorneys’ fees (collectively, “Losses”), to the extent arising out of, relating to or resulting from (a) the development, manufacture,
use, or sale of any Licensed Product by or on behalf of Xcel after the Effective Date, including any product liability regardless of whether based on strict liability, breach of warranty, tort or other legal theory, (b) the breach by Xcel of any of
its representations, warranties or obligations contained in this Agreement, or (c) the gross negligence or willful misconduct of Xcel or its Affiliates. 
  
 11.2 Indemnification by POZEN. Except for Xcel’s indemnification obligation as set forth in the preceding Section 11.1, and except to
the extent caused by Xcel’s or its Affiliates’ negligent, reckless or willful acts or omissions, POZEN will indemnify, defend and hold Xcel and its directors, officers, employees, agents and Affiliates harmless from and against any Losses
which arise from any claim, lawsuit or other action to the extent such Losses arise out of, relate to or result from (a) the development, manufacture, use, or sale of any Licensed Product prior to the Effective Date, including any product liability
regardless of whether based on strict liability, breach of warranty, tort or other legal theory, (b) the development, manufacture, use, or sale of any Licensed Product or any Foreign Licensed Product by or on behalf of POZEN other than by

  

 33 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 or on behalf of Xcel, including any product liability regardless of whether based on strict liability, breach of warranty, tort or other
legal theory, (c) the use of any Xcel Technology or any rights referenced in Section 7.3.3 by POZEN or any sublicensee of POZEN, (d) the breach by POZEN of any of its representations, warranties or obligations contained in this Agreement, or (e) the
gross negligence or willful misconduct of POZEN or its Affiliates. 
  
 11.3 Indemnification Procedures. A Party which intends to claim indemnification under Section 11.1 or 11.2 of this Agreement (the “Indemnitee”) will promptly notify the other Party (the
“Indemnitor”) in writing of any claim, lawsuit or other action in respect of which the Indemnitee or any of its directors, officers, employees, and Affiliates intend to claim such indemnification within a reasonable period of time
after the assertion of such claim; provided, however, that the failure to provide written notice of such claim within a reasonable period of time will not relieve the Indemnitor of any of its obligations hereunder, except to the extent that
the Indemnitor is prejudiced by such failure to provide prompt notice. The Indemnitor will have the right to assume the complete control of the defense, compromise or settlement of any such claim without the prior written consent of such Indemnitee
(although no settlement will be entered into concerning or affecting the validity or enforceability of (a) the Licensed Technology or the Product Trademarks without the written consent of POZEN or (b) the Xcel Technology without the written consent
of Xcel). The Indemnitor will, if it elects to assume control, at its own expense employ legal counsel to defend the claim at issue. At any time after the Indemnitor has assumed defense of a claim, the Indemnitor may exercise, on behalf of the
Indemnitee, any rights which may mitigate the extent or amount of such claim; provided, however, that the Indemnitee: (x) may, in its sole discretion and at its own expense, employ legal counsel to represent it (in addition to the legal
counsel employed by the Indemnitor) in any such matter, and in such event legal counsel selected by the Indemnitee will be required to confer and cooperate with such counsel of the Indemnitor in such defense, compromise or settlement for the purpose
of informing and sharing information with the Indemnitor; (y) will, at its own expense, make available to Indemnitor those employees, officers and directors of Indemnitee whose assistance, testimony or presence is necessary, useful or appropriate to
assist the Indemnitor in evaluating and in defending any such claim; provided, however, that any such access will be conducted in such a manner as not to interfere unreasonably with the operations of the businesses of Indemnitee; and (z) will
otherwise fully cooperate with the Indemnitor and its legal counsel in the investigation and defense of such claim. 
  
 11.4 Insurance. Each Party will maintain commercially reasonable insurance coverage commensurate with its obligations under this Agreement.
As regards Xcel, such commercially reasonable insurance coverage will include comprehensive general liability insurance coverage, including products liability which carries a minimum limit of not less than [CONFIDENTIAL TREATMENT REQUESTED]
upon the Commercial Launch of the Initial Licensed Product, and Xcel will provide POZEN with a certificate of insurance, naming POZEN as additionally insured, evidencing to POZEN such coverage. 
  
 12. LIMITATION OF LIABILITY 
  
 IN NO EVENT WILL ANY PARTY BE LIABLE TO THE OTHER PARTY FOR LOST PROFITS,
LOSS OF DATA, OR FOR ANY SPECIAL, INDIRECT, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES OF SUCH OTHER PARTY, HOWEVER 
  

 34 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 CAUSED, ON ANY THEORY OF LIABILITY AND WHETHER OR NOT SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, ARISING UNDER ANY
CAUSE OF ACTION AND ARISING IN ANY WAY OUT OF THIS AGREEMENT. THE FOREGOING LIMITATIONS WILL NOT APPLY TO DAMAGES ARISING FROM A BREACH OF SECTION 13 OR AN AWARD OF ENHANCED DAMAGES AVAILABLE UNDER THE PATENT LAWS FOR WILLFUL PATENT INFRINGEMENT.

  
 13. CONFIDENTIALITY, PUBLICATIONS, PUBLICITY 
  
 13.1 Confidential Information. Any information or materials
communicated by one Party to the other Party pursuant to this Agreement or the Confidential Disclosure Agreement between the Parties dated February 27, 2003 will be deemed “Confidential Information” of the disclosing Party if (a)
such information or materials are marked “confidential” or with a similar legend, or (b) such information or materials, if disclosed orally or visually, are identified as being confidential at the time of such oral or visual
disclosure, and thereafter reduced to writing, marked “confidential” or with a similar legend, and sent to the other Party within 30 days of such oral or visual disclosure, or (c) such information or materials would, due to the nature
thereof or the circumstances surrounding disclosure, appear to a reasonable person to be confidential or proprietary. Notwithstanding the preceding sentence, “Confidential Information” will not be deemed to include information that the
receiving Party can demonstrate, by competent written proof: 
  
 13.1.1 At the time of disclosure is published or is publicly known or otherwise in the public domain, other than through any act or omission by the receiving Party; 
  
 13.1.2 Was already known to the receiving Party, other
than under an obligation of confidentiality or non-use, prior to the time of disclosure; 
  
 13.1.3 Is disclosed to the receiving Party in good faith, without an obligation of confidentiality, by a Third Party not under any
obligation of confidence with respect to such information; or 
  
 13.1.4 Is independently developed by the receiving Party without use of or reference to the disclosing Party’s Confidential Information. 
  
 13.2 Treatment of Confidential Information. The Parties agree that during the Term and for 7 years after its
expiration or termination for any reason whatsoever, a Party receiving Confidential Information of the other Party will: (a) treat any such Confidential Information disclosed to it by the other Party as strictly confidential; (b) except as necessary
in the performance of this Agreement, not disclose such Confidential Information to Third Parties without the prior written consent of the other Party, other than to its Affiliates, collaborators or any consultants, provided that such disclosure be
under confidentiality agreements with provisions comparable to those contained in this Agreement; (c) not use such Confidential Information for purposes other than those authorized expressly herein; and (d) use reasonable efforts to prevent
inadvertent disclosure of such Confidential Information. 
  
 13.3 Access. Access to Confidential Information will be limited to those employees or consultants of the Party receiving such information or of such Party’s Affiliates who reasonably 
  

 35 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 require such information in order to carry out activities authorized pursuant to this Agreement. Such employees or consultants will be
advised of the confidential nature of the Confidential Information and the related confidentiality undertaking. 
  
 13.4 Permitted Disclosures. 
  
 13.4.1 Notwithstanding any other provision in this Agreement, a receiving Party may disclose Confidential Information of the
disclosing Party to the extent such disclosure is required by law or court order, provided that the receiving Party gives the disclosing Party prompt written notice of the requirement to disclose and reasonably cooperates with the disclosing Party
to seek a protective order or other restrictions on the disclosure of such Confidential Information of the disclosing Party. Any such required disclosure will be limited only to that Confidential Information that is required to be disclosed and such
disclosed Confidential Information will remain Confidential Information hereunder despite the required disclosure. 
  
 13.4.2 Notwithstanding anything herein to the contrary, any Party (and any employee, representative, or other agent of any Party)
may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the transactions contemplated by this Agreement and all materials of any kind (including opinions or other tax analyses) that are provided to
it relating to such tax treatment and tax structure; provided, however, that no Party will be permitted to disclose such tax treatment or tax structure to the extent that such disclosure would constitute a violation of federal or state
securities laws. For the purposes of the foregoing sentence, (i) the “tax treatment” of a transaction means the purported or claimed federal income tax treatment of the transaction, and (ii) the “tax structure” of a transaction
means any fact that may be relevant to understanding the purported or claimed federal income tax treatment of the transaction. Thus, for the avoidance of doubt, the Parties acknowledge and agree that the tax treatment and tax structure of any
transaction does not include the name of any Party to a transaction or any sensitive business information (including, without limitation, the name and other specific information about any Party’s intellectual property or other proprietary
assets) unless such information may be related or relevant to the purported or claimed federal income tax treatment of the transaction. 
  
 13.5 Return of Confidential Information. Upon termination or expiration of this Agreement, each Party hereto and its Affiliates will return
all Confidential Information of the other Party in their possession to the other Party; provided, however, that each Party may retain: (a) a single archival copy of the Confidential Information of the other Party solely for the purpose of
determining the extent of disclosure of Confidential Information hereunder and assuring compliance with the surviving provisions of this Agreement; (b) any portion of the Confidential Information of the other Party which is contained in a
Party’s laboratory notebooks; and (c) any portion of the Confidential Information of the other Party which a Party is required by mandatory applicable law to retain. 
  
 13.6 Confidentiality of the Agreement Terms. Neither Party will disclose the terms of this Agreement to any
Third Party without the prior written consent of the other Party; provided, however, that either Party may disclose the terms of this Agreement (a) to actual or prospective investors and corporate partners, (b) to a Party’s accountants,
attorneys and other 
  

 36 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 professional advisors, and (c) as required by applicable laws and regulations of the U.S. Securities and Exchange Commission, any stock
exchange on which a Party’s stock is traded and any inter-dealer quotation system on which trading information for a Party’s stock is quoted. As part of any filing of this Agreement pursuant to the foregoing clause (c), the filing Party
will provide the other Party with the opportunity to review and comment on proposed redactions to this Agreement for purposes of such filing (although the filing Party will have no obligation in the event that such redactions are not made or
accepted as part of such filing). 
  
 13.7
Publications. Except for Excepted Communications and information which has already been published or is otherwise within the public domain, neither Party may present or publish research results arising from this Agreement, including,
without limitation, any research results which relate to the use of the Licensed Technology in the Field, whether in a thesis, scientific publication, conference or otherwise, without the prior written consent of the other Party. Intended
presentations or publications will be presented in writing to the other Party in the English language for review and comment at least 30 days prior to the time which the presentation or publication is proposed for submission to any Third Party.
Within such 30-day period and at least 5 business days prior to the time which the presentation or publication is proposed for submission to any Third Party, the other Party will provide notice whether it has any comments or objection to the
proposed presentation or publication. The submitting Party will consider in good faith all comments by the reviewing Party. If a reasonable objection is raised (because, for example, the contents of the presentation or publication contain patentable
subject matter for which patent protection should be sought, or because the presentation or publication discloses Confidential Information of the other Party which constitutes proprietary trade secrets or Know-How), then submission of the
presentation or publication will be delayed, unless and until such time as consent to submission of the presentation or publication is given. Each Party may be acknowledged on any publication or presentation by the other Party in accordance with
generally accepted rules of authorship. 
  
 13.8
Publicity. Promptly following the Effective Date, the Parties will publish a mutually agreed joint press release. Neither Party will make any public announcement concerning the existence of or the terms of this Agreement, without the
prior written approval of the other Party with regard to the form, content and precise timing of such announcement, except such as may be required to be made by either Party in order to comply with applicable law, regulations, court order, or tax or
securities filings. Prior to any such public announcement, the Party wishing to make the announcement will submit a draft of the proposed announcement to the other Party not less than 3 business days in advance to enable the other Party to consider
and comment thereon. Notwithstanding anything to the contrary in this Agreement, nothing in this Section 13.8 is intended to prohibit either Party from republishing or restating information relating to this Agreement that has already been approved
by the other Party for use in a prior press release or public announcement. 
  

 37 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 14. TERM AND TERMINATION 
  
 14.1 Term of the Agreement. The term of this Agreement (the “Term”) will commence on the Effective Date and, unless
terminated earlier pursuant to Section 3.4.4 or this Section 14, will expire at the end of the Royalty Term. 
  
 14.2 Termination for Material Breach. In the event of a material breach of this Agreement by either Party which is not cured within 60 days
following receipt of written notice of such breach from the non-breaching Party (or, as applicable, (i) 15 days following receipt of such written notice in the event the breach involves a payment which is not the subject of a bona fide dispute or
(ii) 180 days following receipt of such written notice if the breaching party is attempting to cure the breach at issue and is exercising Commercially Reasonable Efforts with respect thereto), the non-breaching Party will have the right to terminate
this Agreement by written notification to the other Party, effective immediately upon receipt. 
  
 14.3 Termination for [CONFIDENTIAL TREATMENT REQUESTED]. If this Agreement terminates pursuant to Section 3.1.5, [CONFIDENTIAL TREATMENT REQUESTED]. 
  
 14.4 [CONFIDENTIAL TREATMENT REQUESTED]. [CONFIDENTIAL
TREATMENT REQUESTED] terminate this Agreement [CONFIDENTIAL TREATMENT REQUESTED] not less than [CONFIDENTIAL TREATMENT REQUESTED] prior to the date of termination; provided that [CONFIDENTIAL TREATMENT REQUESTED] of the
first Licensed Product [CONFIDENTIAL TREATMENT REQUESTED] under this Agreement. Promptly [CONFIDENTIAL TREATMENT REQUESTED], the Parties will meet to prepare a transition plan for the orderly transfer of the Commercialization and the
development (if any) of the Licensed Products from Xcel to POZEN or a Third Party designated by POZEN. If POZEN or a Third Party designated by POZEN are in a position to assume such Commercialization or development prior to the termination date
[CONFIDENTIAL TREATMENT REQUESTED] in accordance with this Section 14.4, such termination date will be accelerated upon POZEN’s request. 
  
 15. CONSEQUENCES OF TERMINATION 
  
 15.1 General. No termination of this Agreement will relieve any Party from any liability which, at the time of such termination, has already
accrued to the other Party or which is attributable to a period prior to such termination, nor preclude either Party from pursuing any rights and remedies it may have under this Agreement or at law or in equity which accrued or are based upon any
event occurring prior to such termination. 
  
 15.2
Termination Prior to Expiration. If this Agreement is terminated prior to its expiration, then: 
  
 (a) the rights and licenses granted by POZEN to Xcel under this Agreement will terminate immediately; 
  

 38 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 (b) all Regulatory Approvals will be assigned and transferred by Xcel to POZEN, and Xcel will
promptly take all actions and execute such documents as requested by POZEN to effect such transfer to POZEN; 
  
 (c) Xcel will transfer to POZEN such quantities of Licensed Product in Xcel’s inventory as may be requested by POZEN no later
than 30 days of such termination and POZEN will pay to Xcel an amount equivalent to [CONFIDENTIAL TREATMENT REQUESTED] such Licensed Product, provided POZEN will buy all such Licensed Product that has at least [CONFIDENTIAL TREATMENT
REQUESTED] of shelf life at the time this Agreement is terminated and Xcel will be entitled, notwithstanding any provision herein to the contrary, to sell (or have sold) all other Licensed Product in its inventory for up to [CONFIDENTIAL
TREATMENT REQUESTED] following the termination of this Agreement provided that the terms of this Agreement, including Xcel’s royalty payment obligations in Section 8, will apply with respect to such sales (excluding any transfers to POZEN)
as if this Agreement was still in effect; 
  
 (d) at POZEN’s election, Xcel will transfer and cause its Affiliates and agents to transfer to POZEN any or all Promotional Materials, and POZEN will (i) pay to Xcel an amount [CONFIDENTIAL TREATMENT REQUESTED] of such
Promotional Materials, and (ii) sticker-over any Xcel Trademarks prior to the use of any such Promotional Materials; 
  
 (e) POZEN will, insofar as Xcel is concerned, have the exclusive right to develop, make, have made, use, and Commercialize Licensed
Products in the Territory alone or with or through a Third Party; and 
  
 (f) the licenses granted to POZEN in Section 7.3 are worldwide (but non-exclusive in the Territory), fully paid, perpetual and irrevocable. 
  
 15.3 Manufacturing Agreements. With respect to any agreements entered into by Xcel with [CONFIDENTIAL
TREATMENT REQUESTED]: (i) if this Agreement is terminated by POZEN pursuant to Section 14.2, POZEN will assume such agreements (if permitted by such agreements); (ii) if this Agreement is terminated by Xcel pursuant to Section 3.4.4 or Section
14.2, POZEN will assume such agreements if Xcel so elects (and if permitted by such agreements); and (iii) if this Agreement is terminated by [CONFIDENTIAL TREATMENT REQUESTED] pursuant to Section 14.4, [CONFIDENTIAL TREATMENT REQUESTED]
may assume such agreements if [CONFIDENTIAL TREATMENT REQUESTED] so elects (and if permitted by such agreements). 
  
 15.4 Licenses Upon Expiration. Upon expiration of this Agreement pursuant to Section 14.1: (a) the licenses granted to Xcel in Section 7.1
are fully paid, perpetual and irrevocable, subject to the provisions of Section 5.4 relating to payment of a royalty for use of the Product Trademarks; and (b) the licenses granted to POZEN in Section 7.3 are fully paid, perpetual and irrevocable.

  
 15.5 Survival. 
  
 15.5.1 In the event of any expiration or termination
of this Agreement, the following sections will survive (together with the definitions of any defined terms used therein as well as any other provisions to the extent cross-referenced or invoked thereby): Sections 3.5, 3.7, 4.1.2 (unless this
Agreement is terminated pursuant to Section 3.4.4 or 3.1.5 or pursuant to 
  

 39 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 POZEN’s breach under Section 14.2), 5.4.6, 8.4, 8.5, 8.6, 8.7, 8.8, 8.9, 9.1, 10.3, 11, 12, 13, 15, 16, and 17. All
other provisions, including all rights and obligations thereunder, will terminate and be of no further force and effect. 
  
 15.5.2 Section 5.4 (together with the definitions of any defined terms used therein as well as any other provisions to the extent
cross-referenced or invoked thereby) and Section 9 (with respect to the provisions pertaining to the Product Trademarks and Designated POZEN Trademarks, together with the applicable definitions of any defined terms used therein as well as any other
applicable provisions cross-referenced or invoked thereby) will survive the expiration of this Agreement. 
  
 16.    DISPUTE RESOLUTION 
  
 16.1 Discussions. The Parties will try to settle their differences amicably between themselves. In the event of any controversy or claim arising out of or relating to any provision of this
Agreement or the performance or alleged non-performance of a Party of its obligations under this Agreement (a “Dispute”), a Party may notify the other Party in writing of such Dispute. If the Parties are unable to resolve the
Dispute within 20 days of receipt of the written notice by the other Party, such Dispute will be referred to the Chief Executive Officers of each of the Parties (or their respective designees) who will use their good faith efforts to resolve the
Dispute within 10 days after it was referred to the Chief Executive Officers. 
  
 16.2 Arbitration. 
  
 16.2.1 Any Dispute that is not resolved as provided in the preceding Section 16.1, whether before or after termination of this Agreement, will be referred to binding arbitration under the rules of the American
Arbitration Association, to the extent such rules are not inconsistent with this Section 16.2. Judgment upon the award of the arbitrators may be entered in any court having jurisdiction thereof or such court may be asked to judicially confirm the
award and order its enforcement, as the case may be. 
  
 16.2.2 The demand for arbitration will be made within a reasonable time after the Dispute has arisen, and in any event will not be made after the date when institution of legal or equitable proceedings, based on such Dispute, would
be barred by the applicable statute of limitations. The arbitration panel will consist of three (3) arbitrators, one (1) of whom will be appointed by each Party. The two (2) arbitrators thus appointed will choose the third arbitrator; provided,
however, that if the two (2) arbitrators are unable to agree on the appointment of the third arbitrator, either arbitrator may petition the American Arbitration Association to make the appointment. 
  
 16.2.3 The provisions of Federal Rules of Civil
Procedure sections governing discovery are incorporated in and made a part of this Agreement. Depositions may be taken and full discovery may be obtained in any arbitration commenced under this provision. 
  
 16.2.4 The arbitrators will, within 15 days after the
conclusion of the arbitration hearing, issue a written award and 
  

 40 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 statement of decision describing the essential findings and conclusions on which the award is based, including the
calculation of any damages awarded. The Arbitrator are authorized to award compensatory damages consistent with the terms of this Agreement, but are NOT authorized (i) to award non-economic damages, such as for emotional distress, pain and suffering
or loss of consortium, (ii) to award punitive damages, or (iii) to reform, modify or materially change this Agreement or any other agreements contemplated hereunder; provided, however, that the damage limitations described in parts (i) and
(ii) of this sentence will not apply if such damages are statutorily imposed. The arbitrators are authorized to grant any temporary, preliminary or permanent equitable remedy or relief they deem just and equitable and within the scope of this
Agreement, including, without limitation, an injunction or order for specific performance. 
  
 16.2.5 The place of arbitration will be New York, New York. Each Party will bear and pay its own expenses incurred in connection
with any dispute resolution under this Section 16.2. 
  
 16.3
Patents and Other Intellectual Property. Notwithstanding any provision of this Agreement to the contrary, any Dispute relating to a Party’s intellectual property rights or Confidential Information will be submitted exclusively to any
court of competent jurisdiction in the State of New York and, by execution and delivery of this Agreement, each party (a) accepts, generally and unconditionally, the exclusive jurisdiction of such courts and any related appellate court, and
irrevocably agrees to be bound by any judgment rendered thereby as contemplated by this Section 16.3, and (b) irrevocably waives any objection it may now or hereafter have as to the venue of any such suit, action or proceeding brought in such a
court or that such a court is an inconvenient forum. 
  
 17.    MISCELLANEOUS 
  
 17.1 Further Assurances. At any time during the Term, Xcel and POZEN each will, at the request of the other Party, use reasonable efforts to (a) deliver to the other Party such records, data or other documents consistent with
the provisions of this Agreement, (b) execute, and deliver or cause to be delivered, all such assignments, consents, documents or further instruments of transfer or license, and (c) take or cause to be taken all such other actions, as a Party may
reasonably deem necessary or desirable in order for such Party to obtain the full benefits of this Agreement and the transactions contemplated hereby. 
  
 17.2 Assignment. Neither Party will assign its rights or obligations under this Agreement to any Third Party, without the prior written
consent of the other Party; except that either Party may assign such rights and obligations to a Third Party in connection with a merger, acquisition, consolidation, transfer or sale of all or substantially all of the assets of a Party
(collectively, a “Change of Control Event”) provided that such Third Party agrees in writing to be bound by all of the terms and conditions of this Agreement. All permitted assignments by either Party of any of its rights under this
Agreement will be subject to all of the terms and conditions of this Agreement. Any purported assignment not permitted under the terms of this Agreement will be null, void, and of no effect. Notwithstanding anything in this Agreement, the POZEN
Know-How, POZEN Improvements, and POZEN Patents, as well as the Xcel Know- 
  

 41 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 How, Xcel Improvements, and Xcel Patents do not include any intellectual property held by a permitted successor prior to the Change of
Control Event of the relevant Party. 
  
 17.3
Independent Contractors. The Parties are independent contractors. Nothing contained herein will constitute either Party the agent of the other Party for any purpose whatsoever, or constitute the Parties as partners or joint venturers.
Employees of each Party remain employees of said Party and will be considered at no time agents of or owing a fiduciary duty to the other Party. Neither Party will have any implied right or authority to assume or create any obligations on behalf of
or in the name of the other Party or to bind the other Party to any other contract, agreement or undertaking with any Third Party. 
  
 17.4 Waiver. The failure of either Party to enforce any provision of this Agreement at any time will not be construed as a present or future
waiver of such or any other provision of this Agreement. The express waiver by either Party of any provision or requirement hereunder will not operate as a future waiver of such or any other provision or requirement and will be effective only if set
forth in a written instrument signed by a duly authorized representative of the Party waiving such provision or requirement. 
  
 17.5 Amendment. The Parties may amend, modify or alter any of the provisions of this Agreement, but such amendment, modification or
alteration will be valid and binding on either Party only if made by a written instrument that explicitly refers to this Agreement and that is signed by a duly authorized representative of each Party. 
  
 17.6 Severability. In the event that any provision in this
Agreement is held to be unlawful or invalid in any jurisdiction, the meaning of such provision will be construed to the greatest extent possible so as to render it enforceable. If no such construction can render such provision enforceable, it will
be severed. The remainder of this Agreement will remain in full force and effect, and the Parties will negotiate in good faith a reasonable substitute provision that is valid and enforceable in such jurisdiction. If the Parties are unable to agree
on a substitute provision, and if the unlawful or invalid provision was an essential element of this Agreement without which one of the Parties would not have entered into this Agreement, as evidenced by this Agreement as a whole, then such Party
may terminate this Agreement by written notice to the other Party effective upon receipt. 
  
 17.7 Notice. All notices hereunder must be given in writing and will be deemed given if delivered personally or by facsimile transmission (receipt confirmed), mailed by registered or certified mail
(return receipt requested) with postage prepaid, or sent by express courier service (FedEx or other reputable, internationally recognized courier service), to the Parties at the following addresses (or at such other address for a Party as will be
specified by like notice; provided that notices of a change of address will be effective only upon receipt thereof): 
  

 42 

 CONFIDENTIAL TREATMENT REQUESTED 
  

		
	If to POZEN:	  	POZEN, Inc.
		
	 	  	1414 Raleigh Road
		
	 	  	Suite 400
		
	 	  	Chapel Hill, NC 27517
		
	 	  	Attention: President
		
	 	  	Facsimile: (919) 913-1039
		
	With copies to:	  	Cooley Godward LLP
		
	 	  	One Freedom Square
		
	 	  	Reston Town Center
		
	 	  	11951 Freedom Drive
		
	 	  	Reston, VA 20190-5656
		
	 	  	Attention: Matthias Alder
		
	 	  	Facsimile: (703) 456-8100
		
	If to Xcel:	  	Xcel Pharmaceuticals, Inc.
		
	 	  	6363 Greenwich Drive
		
	 	  	Suite 100
		
	 	  	San Diego, CA 92122
		
	 	  	Attention: Chief Financial Officer
		
	 	  	Facsimile: (858) 202-2799
		
	With copies to:	  	Pillsbury Winthrop LLP
		
	 	  	11682 El Camino Real
		
	 	  	Suite 200
		
	 	  	San Diego, CA 92130
		
	 	  	Attention: Mike Hird
		
	 	  	Facsimile: (858) 509-4010

  
 17.8 Force
Majeure. Neither Party will be deemed to be in breach of this Agreement as a result of default, delay or failure to perform by such Party which is due to any cause beyond the reasonable control of such Party, including without limitation, fire,
earthquake, acts of God, severe weather, acts of war, strikes, lockouts or other labor disputes, riots, civil disturbances, actions or inactions of governmental authorities (except actions in response to a breach of applicable laws by such Party),
or epidemics. In the event of any such force majeure, the Party affected will promptly notify the other Party, will use commercially reasonable efforts to overcome such force majeure, and will keep the other Party informed with respect thereto. If
such force majeure continues for a period of more than 180 days, the Party not subject to such force majeure may terminate this Agreement by written notice to the other Party. 
  
 17.9 Counterparts. This Agreement may be executed by the Parties in one or more identical counterparts, all of
which together will constitute this Agreement. If this Agreement is executed in counterparts, no signatory hereto will be bound until both Parties have duly executed a counterpart of this Agreement. Delivery of an executed counterpart of a signature
page of this Agreement by facsimile will be effective as delivery of the originally executed counterpart of this Agreement. 
  

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 CONFIDENTIAL TREATMENT REQUESTED 
  
 17.10 Governing Law. This Agreement will be governed by, and construed an interpreted in accordance with, the
laws of the State of New York without giving effect to any choice of law rule that would cause the application of the laws of any jurisdiction other than the internal laws of the State of New York to the right and duties of the Parties. 

 
 17.11 Construction. Unless used in combination with the word
“either,” the word “or” is used throughout this Agreement in the inclusive sense (and/or). The captions of this Agreement are for convenience of reference only and in no way define, describe, extend or limit the scope or intent
of this Agreement or the intent of any provision contained in this Agreement. References to Sections are references to Sections of this Agreement. The term “including” as used herein will mean including, without limiting the generality of
any description preceding such term. Whenever, in this Agreement, the consent, approval or agreement of the other Party is required in order for a Party to take certain actions, the Parties agree that such consent, approval or agreement may not be
unreasonably withheld or delayed. No rule of strict construction will be applied against either Party. Unless expressly provided herein to the contrary, all time limits, notice periods, deadlines or the like described herein will be governed by the
follow parameters: (i) for all time periods that are 5 days in length or less, such periods will be deemed to be business days, and (ii) for all time periods greater than 5 days in length will be deemed to be calendar days. References to
“$” or “dollars” mean US dollars. 
  
 17.12
Entire Agreement. This Agreement, including any Exhibits attached hereto, constitutes the entire agreement of the Parties with respect to the subject matter hereof, and supersedes all prior and contemporaneous agreements, understandings
and negotiations, whether oral or written, with respect to such subject matter. 
  
 The Parties have caused this Agreement to be executed as of the Effective Date by signature of their duly authorized representatives. 
  

	 POZEN Inc.

		
	 By:
	 	 /s/ John R. Plachetka

	 	 	John R. Plachetka, Pharm. D.
		
	 Title:
	 	Chairman, President and CEO
	
	 Xcel Pharmaceuticals, Inc.

		
	 By:
	 	 /s/ Michael T. Borer

	 	 	Michael T. Borer
		
	 Title:
	 	President and CEO

  

 44 

 CONFIDENTIAL TREATMENT REQUESTED 
  
  

 45 

 CONFIDENTIAL TREATMENT REQUESTED 
  
 EXHIBITS 
  
 Exhibit A—[CONFIDENTIAL TREATMENT REQUESTED] 
  
 Exhibit B—Outline of Autoinjector Development Plan 
  
 Exhibit C—Outline of Marketing Plan for Initial Licensed Product 
  
 Exhibit D—Certain Pozen Patents 
  
 Exhibit E—Certain Xcel Patents 
  
 Exhibit F—Co-Promotion Agreement Dispute Resolution Procedure 
  
 The exhibits have been omitted from this Agreement as filed with the Securities and Exchange Commission (the “SEC”). The omitted information is considered
immaterial from an investor’s perspective. The Registrant will furnish supplementally a copy of any of the documents to the SEC upon the request of the SEC. 
  

 46

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