aquestivehaiscolicenseag






BUSINESS.29027546.1     CERTAIN IDENTIFIED INFORMATION HAS BEEN EXCLUDED FROM THE EXHIBIT BECAUSE IT IS  BOTH NOT MATERIAL AND WOULD LIKELY CAUSE COMPETITIVE HARM TO THE REGISTRANT IF  PUBLICLY DISCLOSED. [***] INDICATES THAT INFORMATION HAS BEEN REDACTED.    LICENSE, DEVELOPMENT AND SUPPLY AGREEMENT  by and between  AQUESTIVE THERAPEUTICS, INC.  and  HAISCO PHARMACEUTICAL GROUP CO, LTD.  Dated as of March 3rd, 2022    





 






BUSINESS.29027546.1             LICENSE, DEVELOPMENT AND SUPPLY AGREEMENT  This LICENSE, DEVELOPMENT AND SUPPLY AGREEMENT (together with any  Schedules hereto, this “Agreement”) is entered into as of March 3rd, 2022 (the “Effective Date”)  by and between Aquestive Therapeutics, Inc., a Delaware corporation (“Aquestive”) having its  principal place of business at 30 Technology Drive, Warren, New Jersey 07059, Haisco  Pharmaceutical Group Co., Ltd. a Chinese limited company listed on the Shenzhen Stock  Exchange with listing code 002653 (“Haisco”) having its principal place of business at No. 136  Baili Road CNSTP, Wenjiang District, Chengdu, Sichuan Province 611130.  Aquestive and  Haisco are sometimes referred to hereinafter individually as a “Party” and collectively as the  “Parties.”  RECITALS:  A. Aquestive owns patented and trade secret proprietary technology related to film- based drug delivery systems including orally soluble film strips containing active pharmaceutical  ingredients.  B. Haisco desires to obtain from Aquestive and Aquestive desires to grant to Haisco,  an exclusive license to Develop and Commercialize the Product in the Field in the Territory,  subject to the terms herein set forth.  C. In consideration of the mutual representations, warranties and covenants  contained herein, the Parties agree as follows:  1. DEFINITIONS  As used herein, the following terms shall have the following meanings:  1.1 “Abandoned Patent” has the meaning set forth in Section 14.2.2.  1.2  “Adverse Event” means any untoward medical occurrence in a patient, clinical  investigation subject, or consumer following administration of a medicine, as related to the use  of the Product which requires reporting to a Regulatory Authority.  1.3 “Affiliate” of a Person means any other Person that directly, or indirectly through  one or more intermediaries, controls, is controlled by, or is under common control with such first  Person.  As used in this definition of Affiliate, “control” and, with correlative meanings, the  terms “controlled by” and “under common control with,” shall mean to possess the power to  direct the management or policies of a Person, whether through: (a) direct or indirect beneficial  ownership of fifty percent (50%) or more of the voting interest in such entity; (b) the right to  appoint fifty percent (50%) or more of the directors of such entity; or (c) by contract or  otherwise.    1.4 “Agreement” has the meaning set forth in the Preamble of this Agreement.  1.5 “API” means the active pharmaceutical ingredient riluzole.  





 






BUSINESS.29027546.1         2    1.6 “Applicable Anti-Bribery and Anti-Corruption Laws” means the U.S. Foreign  Corrupt Practices Act (15 U.S.C. Section 78dd-1, et. seq.), as amended, or any equivalent non- U.S. regulations or standards, in each case, to the extent applicable in the relevant jurisdiction.  1.7 “Applicable Law” means all laws, rules, and regulations, including any rules,  regulations, guidelines, or other requirements of Regulatory Authorities, applicable to the  Development, Commercialization or Supply of the Product, as the case may be, that may be in  effect from time to time in the United States or in the Territory, in each case, to the extent  applicable in the relevant jurisdiction.   1.8 “Aquestive” has the meaning set forth in the Preamble to this Agreement.  1.9 “Aquestive IP” means any and all Intellectual Property owned or Controlled by  Aquestive or its Affiliates as of the Effective Date or during the Term which is useful or  necessary to Develop and/or Commercialize the Product in the Field in the Territory, including  patents and know-how, related to the formulation and manufacturing of oral film dosage forms  for delivery of active ingredients, including the Product, to humans.  1.10 “Aquestive Indemnitees” has the meaning set forth in Section 11.1.  1.11 “Aquestive Housemark” means the name and logo of Aquestive or any of its  Affiliates as identified on Schedule 1A.1 attached hereto, as such schedule may be updated from  time to time, and made a part hereof.  1.12 “Aquestive New IP” has the meaning set forth in Section 14.1.2.  1.13 “Aquestive Patents” means all patents and patent applications owned or  Controlled by Aquestive or its Affiliates as of the Effective Date or during the Term, including  any continuations, continuations-in-part, divisions, or any substitute applications, any patent  issued with respect to any such patent applications, any reissue, reexamination, patents which  remain valid subsequent to any post grant proceedings include Inter Parte Reviews (IPRs) and  Post Grant Review Trials (PGRs) under the American Invents Act (AIA) or other such  challenges which result in the patent being enforceable, renewal or extension (including any  supplementary protection certificate) of any such patent, and any confirmation patent or  registration patent or patent of addition based on any such patent, and all foreign counterparts of  any of the foregoing, or as applicable portions thereof or individual claims therein, which are  useful or necessary to Develop and/or Commercialize Product in the Field in the Territory. A list  of the Aquestive Patents as of the Effective Date is attached hereto as Schedule 1.13, which may  be updated from time to time, and made a part hereof.  1.14 “Bankruptcy Event” means the occurrence of any of the following with respect to  a Party: (a) such Party files in any court or agency, pursuant to any statute or regulation of any  state or country, a petition in bankruptcy or insolvency or for reorganization and such filing is  not withdrawn or dismissed within sixty (60) days after the filing thereof; (b) such Party files for  an arrangement or for the appointment of a receiver or trustee of such Party or of its assets and  such filing is not withdrawn within sixty (60) days after the filing thereof; (c) such Party is  served with an involuntary petition against it, filed in any insolvency proceeding, and such  





 






BUSINESS.29027546.1         3    petition is not dismissed within sixty (60) days after the filing thereof; or (d) the dissolution or  liquidation of such Party, or such Party shall make an assignment for the benefit of its creditors.   1.15 “Business Day” means any day other than a Saturday or Sunday on which  banking institutions in New York, New York, United States or Chengdu, People’s Republic of  China are open for business.  1.16 “Calendar Quarter” means the three (3) month period in any given calendar year  ending on March 31, June 30, September 30, and December 31.  1.17 “Certificate of Analysis” means the certificate evidencing the analytical tests  conducted on a specific lot of a Product reflecting that such Product and any Raw Materials used  therein conform to the relevant Specifications and setting forth, inter alia, the items tested and  test results, and accompanied by all documentation required by Applicable Law and/or a  Regulatory Authority to Commercialize the Product in the Territory.  The Certificate of Analysis  shall be in a format agreed to in writing by the Parties.  1.18 “Certificate of Compliance” means the certificate evidencing that the Product  delivered to Haisco was manufactured in accordance with Applicable Law, and any applicable  Regulatory Approvals. The Certificate of Compliance shall be in a format agreed to in writing by  the Parties.  1.19 “Chinese Accounting Standards” means the accounting standards that are issued  by the Ministry of Finance of People’s Republic of China from time to time.  1.20 “Clinical Supply” has the meaning set forth in Section 5.1.  1.21 “CMC” means chemistry, manufacturing and controls data required by  Applicable Law and/or a Regulatory Authority to Develop the Product in the Field in the  Territory.  1.22 “CMO” has the meaning set forth in Section 4.1.1.  1.23 “Commercial Invoice” has the meaning set forth in Section 7.4.  1.24 “Commercialization” means any and all activities directed to marketing,  promoting, distributing, offering for sale, selling, and importing the Product in the Field in the  Territory, including (a) sales force efforts, detailing, advertising, promotional materials, market  research, market access (including list price and reimbursement activities), and appropriate  medical education and information services, publication, and scientific and medical affairs; (b)  order processing, handling of returns and recalls, booking of sales and transporting the Product  for commercial sale; (c) registering and maintaining the information of pharmaceutical  representatives of the Product with the NMPA and monitoring their academic promotion  activities according to Applicable Law; (d) interacting with Regulatory Authorities regarding the  foregoing; and (e) seeking and obtaining pricing approvals and reimbursement approvals (as  applicable) for the Product.  When used as a verb, “Commercialize” means to engage in  Commercialization.  





 






BUSINESS.29027546.1         4    1.25 “Commercially Reasonable Efforts” means, with respect to a Party and its  obligations under this Agreement with respect to the Product, the level of efforts and resources  (measured as of the time that such efforts and resources are required to be used under this  Agreement)  that are comparable to those used by a similarly situated company in the industry of  a similar size and profile as such Party to develop, manufacture or commercialize, as the case  may be, a pharmaceutical product owned by such company or to which it has rights which is at a  similar stage of research, development or commercialization (as the case may be), and with  similar market potential as the Product and at a similar stage in life cycle, taking into account, as  applicable: that product’s profile of efficacy and safety; proprietary position, including patent  and regulatory exclusivity; regulatory status, including anticipated or approved labeling and  anticipated or approved post-approval requirements; present and future market and commercial  potential, including the competitiveness of the marketplace; any legal and regulatory issues  involved, the profitability of the applicable products and other relevant factors, including  technical, legal, scientific, medical, sales performance, and/or marketing factors.   1.26 “Competitive Infringement” has the meaning set forth in Section 14.4.1.  1.27 “Confidential Information” has the meaning set forth in Section 10.1.  1.28 “Confidentiality Agreement” means that certain Confidentiality Agreement  between Aquestive and Haisco executed and delivered as of October 29, 2020.  1.29 “Control” or “Controlled” means, with respect to any Intellectual Property, the  possession (whether by ownership, license or sublicense, other than by a license, sublicense or  other right granted (but not assignment) pursuant to this Agreement) by a Party (or its Affiliate)  of the ability to assign or grant to the other Party the licenses, sublicenses or rights to access and  use such Intellectual Property as provided for in this Agreement, without violating the terms of  any agreement or other arrangement with any third Party in existence as of the time such Party  would be required hereunder to grant such license, sublicense, or rights of access or use.  1.30 “CPA Firm” has the meaning set forth in Section 8.10.  1.31 “CRO” has the meaning set forth in Section 2.9.  1.32 “Delivery Failure” has the meaning set forth in Section 7.9.  1.33 “Development” means all development activities conducted in connection with or  as a condition of seeking or obtaining and maintaining Regulatory Approval of the Product in the  Field in the Territory including, among other things: the conduct of (a) all research, non-clinical,  and pre-clinical activities, testing and studies of the Product; drug discovery, toxicology,  pharmacokinetic, pharmacodynamic, drug-drug interaction, safety, tolerability and  pharmacological studies, formulation, statistical analysis and report writing; (b) clinical studies  (including post-Marketing Authorization human studies) and distribution of the Product for use  in clinical studies, if any; (c) preparation, filing and prosecution of any Regulatory Approval or  Regulatory Approval Application for the Product; (d) regulatory filing submissions and  registration; (e) Raw Material testing; (f) all development activities directed to label expansion  (including prescribing information) or obtaining Marketing Authorization of the Product for one  or more additional indications following initial Marketing Authorization; (g) all development  





 






BUSINESS.29027546.1         5    activities conducted after receipt of Marketing Authorization of the Product that are required or  requested in writing by a Regulatory Authority as a condition of, or in connection with, obtaining  or maintaining a Marketing Authorization; (h) any pharmacoeconomic studies required for the  Marketing Authorization; (i) any investigator- or institution-sponsored studies required for the  Marketing Authorization; (j) pre-approvals, post-approval obligations and reporting relating to  the Product in the Field in the Territory; and (j) all regulatory affairs related to any of the  foregoing.  When used as a verb, “Develop” means to engage in Development.   1.34 “Disclosing Party” has the meaning set forth in Section 10.1.  1.35  “Distributor” has the meaning set forth in Section 2.9.  1.36 “DMF” has the meaning set forth in Section 4.2.1.  1.37 “DMF Holder” has the meaning set forth in Section 4.2.3.  1.38 “Dosage Strength” means the 50mg dosage strength of the Product.  1.39 “Drug Product” means a chemical drug product as defined in Applicable Law for  administration to human subjects.  1.40 “Excluded Claim” has the meaning set forth in Section 15.12.8.  1.41 “Effective Date” has the meaning set forth in the Preamble of this Agreement.  1.42 “Events” means the events set forth in Section 8.1.  1.43 “Executive Officer” has the meaning set forth in Section 15.12.2.  1.44 “Field” means administration of the Product for Amyotrophic Lateral Sclerosis.  1.45 “First Commercial Sale” means the first sale of the Product to a Third Party by  Haisco or its Affiliates or agents within the Territory after receipt of Regulatory Approval;  provided, that, the following shall not constitute a First Commercial Sale: (a) any sale to an  Affiliate or sublicensee (unless the Affiliate or sublicensee is the last entity in the distribution  chain of the Product); (b) any use of the Product in clinical trials or other research or  Development activities; or (c) the disposal or transfer of the Product for a bona fide charitable  purpose, without consideration, including for any compassionate use and/or as “named patient  sales”.  1.46 “Force Majeure” has the meaning set forth in Section 15.7.  1.47 “Generic Product” means, with respect to the Product in the Field in the Territory,  any Drug Product  (other than the Product) that: (a) contains the API as the active pharmaceutical  ingredient; and (b) is approved by the NMPA pursuant to an abbreviated application filed with  the NMPA pursuant to the Applicable Law of the People’s Republic of China for which the  Product is the Reference Listed Drug and which is not held in the name of Aquestive, Haisco or  an Affiliate thereof, or sublicensee or subcontractor thereof.  





 






BUSINESS.29027546.1         6    1.48 “Governmental Authority” means any national, international, federal, state,  provincial or local government, or political subdivision thereof, or any multinational  organization or any authority, agency or commission entitled to exercise any administrative,  executive, judicial, legislative, police, regulatory or taxing authority or power, any court or  tribunal (or any department, bureau or division thereof, or any governmental arbitrator or arbitral  body).  1.49 “Haisco” has the meaning set forth in the Preamble to this Agreement.  1.50 “Haisco Housemark” means the name and logo of Haisco or any of its Affiliates  as identified on Schedule 1A.2 attached hereto, as such schedule may be updated in writing from  time to time, and made a part hereof by amendment of such Schedule.  1.51 “Haisco Indemnitees” has the meaning set forth in Section 11.2.  1.52 “Haisco New IP” has the meaning set forth in Section 14.1.2.  1.53 “ICC” has the meaning set forth in Section 15.12.3.  1.54 “ICC Rules” has the meaning set forth in Section 15.12.3.  1.55 “Indemnitee” has the meaning set forth in Section 11.3.1.  1.56 “Indemnitor” has the meaning set forth in Section 11.3.1.  1.57 “Indication” means any indication in the Field.  1.58 “Intellectual Property” means, collectively, all: (a) all patents, patent applications  including provisional applications and statutory invention registrations, including reissues,  divisions, continuations, continuations-in-part, and reexaminations, patents which remain valid  after IPRs and PGRs and any court challenges, and all inventions disclosed therein;  (b) copyrightable works, copyrights in works of authorship of any type, including computer  software and industrial designs, registrations and applications for registration thereof; (c) trade  secrets, know-how, processes, specifications, product designs, descriptions of the manufacturing  process and equipment and all other manufacturing information, engineering and other manuals  and drawings, standard operating procedures, flow diagrams, chemical, pharmacological,  toxicological, pharmaceutical, physical and analytical, safety, quality assurance, quality control  and clinical data, technical information, data, research records, supplier lists and similar data and  information, and all rights in any jurisdiction, according to the laws of the jurisdiction, to limit  the use or disclosure thereof; (d) including any and all rights to extensions to any of the  foregoing; (e) any and all rights of application regarding any of the foregoing; and (f) rights to  sue and recover damages or obtain injunctive relief for infringement, or misappropriation  thereof.  1.59 “Joint New IP” has the meaning set forth in Section 14.1.3.  1.60 “Joint Patents” has the meaning set forth in Section 14.1.3.  





 






BUSINESS.29027546.1         7    1.61 “Losses” means any and all damages, awards, deficiencies, settlement amounts,  defaults, assessments, fines, dues, penalties, costs, fees, liabilities, obligations, taxes, liens,  losses, lost profits and expenses (including, without limitation, court costs, interest and  reasonable fees of attorneys, accountants and other experts), together with all documented out- of-pocket costs and expenses incurred in complying with any judgments, orders, decrees,  stipulations, investigations and injunctions.  1.62 “Marketing Authorization” means authorization from the relevant Regulatory  Authorities within Mainland China for approval to market, sell or otherwise Commercialize the  Product in the Field in the Territory.  1.63 “Minimum Payment Commitment” has the meaning set forth in Section 8.4.  1.64 “NDA” means the FDA-approved new drug application for the Product trade  named EXSERVAN under NDA #212640, including all amendments and supplements thereto  and all documentation filed with the FDA in connection therewith.   1.65 “Net Sales” means, for any period of determination, with respect to the Product  sold by Haisco (or any Affiliate or sublicensee of Haisco), the aggregate amount invoiced for the  sale by Haisco of the Product in the Field in the Territory to unaffiliated Third Parties (unless  invoiced to an Affiliate or sublicensee which is the last entity in the distribution chain for the sale  of the Product), less amounts for the following deductions:  (a) trade, quantity or cash discounts, charge-back payments, allowances or  rebates to the extent actually taken and allowed, including promotional or similar discounts or  rebates and discounts or rebates to governmental or managed care organizations;  (b) bad debts;  (c) credits or allowances given or made with respect to the Product by reason  of rejection, defects, recalls, returns, rebates, retroactive price reductions; and  (d) any tax, tariff, duty or government charge (including any sales, value  added, excise or similar tax or relevant surtax or government charge) levied on the sale,  importation, exportation, transportation or delivery of the Product and borne by the seller thereof  that is not reimbursed by any Third Party.  Notwithstanding the foregoing, Net Sales shall not include amounts received or invoiced  by Haisco or its Affiliates or sublicensees: (i) for the sale of the Product among Haisco and its  Affiliates and sublicensees (unless the Affiliate or sublicensee is the last entity in the distribution  chain of the Product); (ii) for academic research, preclinical, clinical, or regulatory purposes  (including the use of a Product in Clinical Trials) reasonably necessary to comply with  Applicable Law; (iii) in connection with charitable purposes, such as a compassionate use,  “named patient” or expanded access program; or (iv) to physicians or hospitals for promotional  purposes (including free samples to a level and in an amount which is customary in the industry  or which is reasonably proportional to the market for the Product to the extent permissible by  Applicable Law).  





 






BUSINESS.29027546.1         8    The amounts of any deductions accrued pursuant to this Section shall be determined from  books and records maintained in accordance with the Chinese Accounting Standards and shall  only be deducted once and only to the extent not otherwise deducted from the aggregate amount  invoiced.  If Haisco (or any of its Affiliates or sublicensees) sells the Product to a Third Party who  also purchases other products or services from any such entity, and Haisco or its Affiliates or  sublicensees bundle or include the Product as part of any multiple product offering or discount or  price Product as part of a bundle or multiple Product offering, such discounts (or other price  reductions or adjustments) shall be allocated to the Product and other products offered for sale by  Haisco or its Affiliates or sublicensees to such customer in direct proportion to the gross sales  price of the Product as compared to the gross sales price of the other products in the offering sold  to such Third Party purchaser or a similarly situated Third Party purchaser if such products are  not sold to the Third Party purchaser on a stand-alone basis (in each case, as such gross sales  prices, are determined, or would be determined, as applicable, without such bundling or multiple  product offering); provided however, that prior the gross sales price for the Product and the other  products in the bundled or multiple product offering and the discount allocation or other price  reductions or adjustments shall be disclosed to Aquestive in writing with reasonable supporting  documentation.  1.66 “New IP” has the meaning set forth in Section 14.1.2.  1.67 “NMPA” means the Chinese National Medical Products Administration, agencies  or departments under its supervision, and any of its successor agencies or departments.  1.68 “Notice to Abandon” has the meaning set forth in Section 14.2.2.  1.69 “Party” or “Parties” has the meaning set forth in the Preamble to this Agreement.  1.70 “Patent Term Extensions” has the meaning set forth in Section 14.3.  1.71 “Permitted Sublicensees” has the meaning set forth in Section 2.9.  1.72 “Person” means an individual, sole proprietorship, partnership, limited  partnership, limited liability partnership, corporation, limited liability company, business trust,  joint stock company, trust, unincorporated association, joint venture or other legal entity or  organization, including a government or political subdivision, department, or agency of a  government.  1.73 “Primary Packaging” means the foil pouch that individually wraps and touches  each Unit.  1.74 “Primary Packaging Design” means artwork associated with the Primary  Packaging for the Product in the Territory.  1.75 “Product” means Aquestive’s ExservanTM (riluzole oral soluble film) product in  the Dosage Strength.  





 






BUSINESS.29027546.1         9    1.76 “Product Label” means labels and other written material pertaining to the core  label for the Product including, but not limited to, safety information, prescribing information,  medication guides, and instructions for use.  1.77 “Product Marks” has the meaning set forth in Section 2.6.3.  1.78 “Product Transfer Price” has the meaning set forth in Section 7.2.  1.79 “Purchase Orders” has the meaning set forth in Section 7.1.  1.80 “Quality Agreement” has the meaning set forth in Section 7.12.  1.81 “Raw Materials” means raw materials, chemicals, work-in-process, and other  materials used to Supply Product under this Agreement.  1.82 “Raw Materials Safety Stock” has the meaning set forth in Section 7.8.  1.83 “Recall” has the meaning set forth in Section 13.5.1.  1.84 “Recall Expenses” has the meaning set forth in Section 13.5.1.  1.85 “Recall Objection Notice” has the meaning set forth in Section 13.5.1.  1.86 “Receiving Party” has the meaning set forth in Section 10.1.  1.87 “Registration Batches” has the meaning set forth in Section 5.1.  1.88 “Regulatory Approval” means any approvals (including applications therefore,  supplements and amendments thereto and pricing and reimbursement approvals), licenses,  registrations, or authorizations of any Regulatory Authority, necessary for the Development,  Commercialization, Supply, manufacture, testing, labeling, packaging, or shipping of the Product  in the Territory, including the approval for clinical trials and the Marketing Authorization(s) for  the Product.  1.89 “Regulatory Approval Application” means any filings submitted to a Regulatory  Authority in the Territory, in each case, with all additions, deletion or supplements thereto, for  Regulatory Approval of the Product in the Territory.  1.90 “Regulatory Authority” means any national, regional, state, provincial or local  regulatory agency, department, bureau, commission, council or other governmental authority in  the Territory involved in the granting of approvals (including pricing and reimbursement  approvals), licenses, registrations or authorizations for the marketing, sale, manufacturing,  testing, labeling, storage, handling, packaging, shipping or supply the Product, including the  NMPA, and any other body or any health regulatory authority(ies) in the Territory that is  equivalent to the United States Food and Drug Administration (and its successor agencies or  departments) and holds responsibility for granting Regulatory Approval for the Product, and any  successor(s) thereto having substantially the same functions.   





 






BUSINESS.29027546.1         10    1.91 “Regulatory Documentation” means (i) documentation set forth on Schedule 1.91  attached hereto, (ii) documentation and information required by Regulatory Authorities for  Development and Commercialization of the Product in the Field in the Territory, and (iii) such  other documentation mutually agreed in writing to be required to be provided to Regulatory  Authorities for Development and Commercialization of the Product in the Field in the Territory.  1.92 “Rescheduled Delivery Date” has the meaning set forth in Section 7.9.  1.93 “Royalty Period” means each quarterly period during the Term; provided that the  first Royalty Period for each Product shall end on December 31 in the year in which the First  Commercial Sale of the Product occurs.  1.94 “Royalty Report” has the meaning set forth in Section 8.5.  1.95 “Secondary Packaging” means the packaging that contains the Primary Packaging  and which does not come in contact with the single dosage strips of the Product.   1.96 “Specifications” means the written specifications for the Product and Raw  Materials mutually agreed upon by the Parties including, without limitation, the shelf life of such  Product and Raw Materials for such Product and the specifications as set forth in the applicable  Regulatory Approval for the Product.  The Specifications, and any modifications or supplements  thereto, shall be mutually agreed in writing by the Parties from time to time during the Term, and  upon such mutual agreement shall be deemed to be incorporated by reference in this Agreement.  1.97 “Statement of Work” means a written document executed and delivered by the  Parties that defines, as applicable, the work activities, requirements, deliverables, timeline,  associated pricing and any other terms and conditions to govern given work project to be  conducted by a Party under this Agreement.  1.98 “Steering Committee” has the meaning set forth in Section 3.1.  1.99 “Step In Notice” has the meaning set forth in Section 14.2.2.  1.100 “Step In Rights” has the meaning set forth in Section 14.2.2.  1.101 “Supply” means the manufacture, supply, processing, storing, labeling, and  packaging (as specified in this Agreement) for sale and delivery of the Product.  1.102 “Term” has the meaning set forth in Section 12.1.  1.103 “Territory” means Mainland China.  1.104 “Third Party” means any Person other than Aquestive and Haisco and their  respective Affiliates.  1.105 “Third Party Claim” has the meaning set forth in Section 11.1.  





 






BUSINESS.29027546.1         11    1.106 “Unit” shall mean a single dosage strip of the Product, in an individual foil pouch,  for sample or sale.  1.107 “Validation Batches” has the meaning set forth in Section 5.1.  2. RIGHTS AND OBLIGATIONS  2.1 Licenses Granted to Haisco.  Subject to the terms and conditions of this  Agreement, Aquestive hereby grants to Haisco, and Haisco hereby accepts, an exclusive royalty- bearing license, with the right to grant sublicenses solely in accordance with Section 2.9 below,  under and to Aquestive IP within the Territory to Commercialize the Product in the Field, and to  perform the Development activities set forth in Section 5.2.  2.2 Covenant of Aquestive.  Aquestive hereby covenants and agrees with Haisco that  during the Term, other than as expressly provided herein, Aquestive will not grant any license or  right with respect to the Aquestive IP to any Affiliate or Third Party to, research, make, have  made, Develop or Commercialize the Product in the Field in the Territory.  2.3 Covenant of Haisco.  Haisco hereby covenants and agrees that neither Haisco,  nor any of its Affiliates shall, directly, or indirectly (whether through an Affiliate, sublicensee,  Third Party, or by any transfer or license rights to an Affiliate, sublicensee or Third Party),  during the Term, make, use, Develop, import/export, seek Regulatory Approval for,  manufacture, distribute, offer to sell, sell, market, promote, detail, or otherwise commercialize  any products using non-injection or non-swallowed  forms of delivery containing the API in the  Field anywhere in the Territory other than pursuant to this Agreement.  2.4 No Implied Licenses; Negative Covenant.  Except as set forth in this  Agreement, neither Party shall acquire any license or other Intellectual Property interest, by  implication or otherwise, under any Intellectual Property Controlled by the other Party or its  Affiliates.  Neither Party shall, nor shall it permit any of its Affiliates or sublicensees to, practice  any Intellectual Property licensed to it by the other Party outside the scope of the licenses granted  to it under this Agreement.  2.5 Manufacturing Exclusivity.  Aquestive shall have the exclusive right to Supply  the Product; provided, however, that, subject to Section 15.4 below, Aquestive may designate  such right and obligation to one or more of its Affiliates or to a Third Party selected by  Aquestive, in the case as to the designation thereof to a Third Party, upon submission of  sufficient information to reasonably demonstrate the adequate financial and operational capacity  to manufacture the requirements of Haisco for the Product under this Agreement.  Notwithstanding the foregoing, Aquestive will remain responsible for the obligations designated  to, and payment to, such Affiliates or such Third Party to the same extent it would if it had done  such work itself.  2.6 Trademarks.  2.6.1 Subject to the terms and conditions of this Agreement, Aquestive hereby  grants to Haisco, and Haisco accepts, a non-exclusive, non-transferable license, with the right to  grant sublicenses solely in accordance with Section 2.9, to use the Aquestive Housemark in the  





 






BUSINESS.29027546.1         12    Territory solely in conjunction with the Product in the Field in the Territory and solely for such  uses as are approved in writing by Aquestive, such approval not to be unreasonably withheld,  conditioned or delayed.  The following shall appear on the labeling and packaging of each  Product: “Manufactured by Aquestive Therapeutics, Inc.”  2.6.2 Subject to the terms and conditions of this Agreement, Haisco hereby  grants to Aquestive, and Aquestive accepts, a non-exclusive, non-transferable, non-sublicensable  license to use the Haisco Housemark in the Territory solely in conjunction with the labeling and  specified packaging of Product and solely as such are approved in writing by Haisco, in  connection with the Supply of the Product hereunder, such approval not to be unreasonably  withheld, conditioned or delayed.  2.6.3 Notwithstanding anything to the contrary, Haisco shall have the right to  name and brand the Product in the Field in the Territory using trademarks, logos, and trade  names it determines appropriate for such Product in the Territory (the “Product Marks”). Haisco  shall own all rights in the Product Marks in the Territory and shall register and maintain the  Product Marks in the Territory as it determines reasonably necessary. Aquestive shall provide  reasonable assistance to Haisco, at Haisco’s sole cost and expense, in connection with  registration and maintenance of the Product Marks, including without limitation, providing  documents as Haisco may reasonably request.  2.7 Packaging and Labeling.  Aquestive shall label and package the Product in  accordance with the Primary Packaging Design specifications, Applicable Law, and the  approved Regulatory Approval Application for the Product.  Haisco shall be responsible, at its  cost and expense, for developing and providing Aquestive with a copy of all graphics and  artwork to be used with each Product, including the Primary Packaging Design, which shall be  delivered to Aquestive as an electronic file in Adobe Illustrator format, and including the  cylinder costs used by Aquestive’s vendor to print the graphics.  Haisco shall be responsible for  any required notifications to the applicable Regulatory Authorities regarding the labeling and  packaging configurations for the Product, including any changes in labeling or packaging  configurations and shall be responsible for ensuring that labeling, packaging configurations, and  the Primary Packaging Design complies with Applicable Law.  Haisco shall also be responsible  for all secondary labeling and Secondary Packaging and the contents of package inserts or  outserts, including ensuring that the foregoing comply with Applicable Law. The packaging for  the Product, including the Primary Packaging and Secondary packaging, shall indicate that the  Product is manufactured by Aquestive.  Any changes to the Product Label shall be subject to  Aquestive’s written approval; provided however, that a change concerning quantities within a  package made in compliance with Applicable Law shall not be deemed a change to the Product  Label and can be made at the sole discretion of Haisco.  2.8 Aquestive Retained Rights.  Any rights of Aquestive not expressly granted to  Haisco under the provisions of this Agreement shall be retained by Aquestive.  In furtherance of  the foregoing and not in limitation thereof, Aquestive, except as expressly set forth in Section 2.1  and Section 2.9, shall retain the right: (a) to carry-out its obligations under this Agreement; and  (b) to exploit the Aquestive IP for purposes outside of the scope of the licenses granted in  Section 2.1 for any and all purposes anywhere in the world, without any duty to account to  Haisco or obtain Haisco’s consent for such exploitation.  





 






BUSINESS.29027546.1         13    2.9 Sublicensees and Subcontractors.  Haisco may grant sublicenses under this  Agreement to one or more sublicensees, and may exercise its rights or perform its Development  obligations under this Agreement through one or more subcontractors, provided that: (a) use of a  subcontractor and/or grant of a sublicense requires the prior written approval of Aquestive, such  approval not to be unreasonably withheld, conditioned or delayed; provided, however, that the  prior written consent of Aquestive is hereby waived if and to the extent Haisco, upon written  notice to Aquestive: (i) grants to its Affiliate(s) such sublicense or subcontract, or (ii)  subcontracts certain activities related to Development of the Product to Third Party contract  research organizations (each, a “CRO”) and grants such sublicense to the CRO to the extent  necessary or appropriate for them to conduct the subcontracted activities, or (iii) subcontract  certain activities related to Commercialization of the Product to Third Party distributors, sub- distributors or sales agents (each, a “Distributor”) and grants such sublicense to the Distributor to  the extent necessary or appropriate for them to conduct the subcontracted activities (collectively,  the “Permitted Sublicensees”); (b) Haisco will remain responsible for the work allocated to, and  payment to, such subcontractor or sublicensee to the same extent it would if it had done such  work itself; (c) each subcontractor or sublicensee other than the Permitted Sublicensees performs  work on the basis of a written contract which is not inconsistent with Section 9.3.3, Section  9.3.4, Section 9.3.5 and Section 10 below;  and (d) each Permitted Sublicensee agrees in writing  to assign all Intellectual Property developed in the course of performing any such work in  relation to the Product to Haisco (or, in the event such assignment is not feasible, a license to  such Intellectual Property with the right to sublicense to Aquestive) on an exclusive, worldwide  royalty-free basis.  3. STEERING COMMITTEE  3.1 Steering Committee.  No later than one (1) month following the Effective Date,  the Parties will establish a committee to provide a forum for communication between the Parties  regarding Development, Supply and Commercialization activities under this Agreement (the  “Steering Committee”). Each Party shall assign an alliance manager (whom shall serve on the  Steering Committee) to oversee the implementation of this Agreement and to organize each  Steering Committee meeting and provide updates for the Product to the Steering Committee. The  Steering Committee shall meet at least two (2) times per calendar year, on a schedule and at a  location to be agreed by the Parties in writing. Notwithstanding the foregoing, the Steering  Committee shall be solely advisory and not have any decision-making authority.  For the  avoidance of doubt, Haisco shall have the sole decision-making authority regarding the  Development set forth in Section 5.2 hereof and Commercialization for the Product in the Field  in the Territory, except changes to the Product Label as provided in Section 2.7 and Section  5.3.1.  4. TRANSFER OF INFORMATION AND DOCUMENTATION  4.1 Certain Regulatory Documentation.    4.1.1 Promptly following the receipt of the first milestone payment pursuant to  Section 8.1 but in no case later than ten (10) Business Days thereafter, Aquestive shall deliver or  make available to Haisco, at Aquestive’s sole cost and expense, copies of the Regulatory  Documentation in the possession or Control of Aquestive and thereafter promptly but in no case  





 






BUSINESS.29027546.1         14    later than thirty (30) days following the written request of Haisco, all other existing information  and data in the possession or Control of Aquestive which are necessary for obtaining or  maintaining the Marketing Authorization for the Product in the Field in the Territory that was not  filed with the FDA. To the extent any of the Regulatory Documentation is not in Aquestive’s  possession or Control, Aquestive shall use Commercially Reasonable Efforts to provide or cause  the relevant Third Parties (including contract manufacturers, (“CMOs”), API suppliers or other  partners for the Product outside of the Territory) to provide to Haisco, promptly but in no case  later than sixty (60) days following the written request of Haisco, the existing documents and  information in such Third Parties’ possession or Control.   4.1.2 Aquestive will thereafter: (a) deliver or make available to Haisco copies of  any other (including new or updated) Regulatory Documentation in the possession or Control of  Aquestive; and (b) use Commercially Reasonable Efforts to cause the relevant Third Parties to  deliver or make available to Haisco copies of any other (including new or updated) Regulatory  Documentation, in each case to the extent required for the Development and/or  Commercialization of the Product in the Field in the Territory.  4.1.3 In addition to the transfer of Regulatory Documentation described above,  Aquestive shall use Commercially Reasonable Efforts to assist Haisco in preparing and filing  Regulatory Documentation in the Territory at Haisco’s sole cost and expense, including without  limitation, in connection with regulatory actions, submissions, queries, actions and  communications for the Product in the Field in the Territory.  4.2 DMFs.    4.2.1 Within ninety (90) days after the Effective Date, Aquestive shall provide,  or make available to Haisco all Drug Master Files associated with the Product (each, a “DMF”)  in the possession or Control of Aquestive that are required to support application for Regulatory  Approval for the Product in the Territory, together with a letter of authorization substantially in  the form as attached hereto as Schedule 4.2 (each, a “LOA”).   4.2.2 If the DMF for the API is not in Aquestive’s possession or Control,  Aquestive shall instruct the Third Party API supplier to provide or make available to Haisco,  within ninety (90) days after the Effective Date the DMF for the API and a LOA.  4.2.3 In the event any other DMF that is necessary for the Development  activities to be conducted by Haisco or Commercialization of the Product in the Field in the  Territory are Controlled by Third Party(ies) (each, a “DMF Holder”), and to the extent any such  DMF is required to support application for the Regulatory Approval for the Product in the  Territory, Aquestive shall use Commercially Reasonable Efforts to provide or cause all the  applicable DMF Holder to provide or make available to Haisco, no later than ninety (90) days  after the receipt of a written request from Haisco, complete copies of any and all such DMF and  LOA(s), at Aquestive’s (or such DMF Holder’s) sole cost and expense.   4.2.4 Notwithstanding the foregoing, and only to the extent permitted by the  Regulatory Authority in the Territory:  





 






BUSINESS.29027546.1         15    4.2.4.1 if any DMF Holder insists on directly filing any required DMF  with such Regulatory Authority, it may directly file such DMF with such Regulatory Authority  according to related requirements of such Regulatory Authority and obtain registration  number(s) for such DMFs to support Regulatory Approval of the Product in the Territory, at  Aquestive’s (or such DMF Holder’s) sole cost and expense, provided that (i) Aquestive shall  notify Haisco, within twenty (20) days after the receipt of such request from Haisco or such  Regulatory Authority, such DMF Holder’s election to make direct filing; (ii) Aquestive shall  request any such DMF Holder to make such submission and obtain, no later than ninety (90)  days after the notice to Haisco in accordance with clause (i) in this Section 4.2.4.1, registration  number(s) for such DMF, so as to support filing for Regulatory Approval of the Product in the  Territory; and (iii) provide a LOA to Haisco (as applicable); and  4.2.4.2 if any DMF Holder is unable or unwilling to provide, make  available, or file, as applicable, a DMF necessary to support the Regulatory Approval of the  Product in the Territory, it may: (a) provide or make available to Haisco; or (b) directly file  required documentation to such Regulatory Authority according to related requirements of such  Regulatory Authority to support Regulatory Approval of the Product in the Territory at  Aquestive’s (or such DMF Holder’s) sole cost and expense (if a direct submission to the  Regulatory Authority), provided that Aquestive shall request any such DMF Holder to provide,  make available, or make such submission and obtain associated registration number(s), as  applicable, in each case no later than ninety (90) days after the receipt of a written request from  Haisco or such Regulatory Authority, so as to support filing for Regulatory Approval for the  Product in the Territory, and provide a LOA to Haisco (as applicable).   4.2.5 If a Regulatory Authority in the Territory requires, in connection with  Haisco’s Regulatory Approval Application in the Territory (including without limitation, clinical  trial application and new drug application in the Territory), additional information and/or  documents in connection with DMFs beyond that have already been provided under Sections  4.2.1 through 4.2.4, upon reasonable request by Haisco, Aquestive shall, and shall use  Commercially Reasonable Efforts to cause the relevant Third Party API supplier and DMF  Holders to, within the time specified by the applicable Regulatory Authority, submit directly to  the applicable Regulatory Authority (to the extent permitted by the Regulatory Authority) or  provide Haisco with, the information and documents in support of Development activities  required by such Regulatory Authority.  4.2.6 In the event that any DMF Holder is unable to provide to Haisco or file  with the Regulatory Authority any required DMF or equivalent documentation and/or  information within the timeframe provided in this Section 4.2, Aquestive shall engage a new  supplier that can fulfill such requirements; Haisco will reimburse the costs and expenses of  Aquestive (to the extent reasonable and documented) incurred in engaging such new supplier to  fulfill the requirements provided in this Section 4.2.  4.2.7 Notwithstanding anything set forth in this Agreement to the contrary, if,  despite a Party’s written request therefor, the applicable Third Party supplier is unable to  provide, make available, or file, as applicable a DMF or other documentation necessary to  support the Regulatory Approval of the Product in the Territory within the applicable time  periods set forth in this Section 4.2, Haisco shall permit a reasonable extension of time (but shall  





 






BUSINESS.29027546.1         16    not be obligated to permit more than one extension for a period of no more than fifteen (15)  days) to permit such Third Party supplier to comply with such request, provided that Haisco  receives reasonable assurances that such Third Party has made and will continue to make good  faith efforts to meet such request.    5. DEVELOPMENT; MAINTENANCE OF REGULATORY APPROVALS  5.1 Development Responsibilities of Aquestive.  Aquestive shall, to the extent  necessary to support the Development activities to be conducted by Haisco: (a) provide or use  Commercially Reasonable Efforts to cause the relevant Third Parties to provide Haisco with such  regulatory materials and other regulatory data and information related to the Product in English  as set forth in Section 4; and (b) conduct additional activities including CMC and other pre- clinical or non-clinical activities in accordance with Section 5.2.2 at Haisco’s sole cost and  expense, in each case of (a) and (b) above, to the extent required by NMPA in connection with  the Regulatory Approval or Marketing Authorization for the Product in the Field in the Territory.   Aquestive shall Supply Haisco (i) such quantities of the Product required for the clinical studies  (“Clinical Supply”), (ii) three (3) batches of Product for registration purposes (“Registration  Batches”), and (iii) to the extent required, three (3) batches of Product for validation purposes  (“Validation Batches”), in each case, necessary for Development to the extent included in a  Statement of Work.  The Clinical Supply and Registration Batches shall be supplied as follows:  (i) up to [***] Units of the Product at [***] and (ii) quantities of Product in excess of [***] Units  at [***].  The Validation Batches shall be supplied at [***].  Notwithstanding the foregoing, if  Aquestive must manufacture an entire batch to fulfill Supply obligations for clinical studies,  Aquestive and Haisco shall mutually agree in writing upon the price for the Product, which in no  case shall exceed the per Unit price set forth in the preceding sentence.   Aquestive shall provide  Clinical Supply with blank packaging.  Haisco shall be solely responsible for the labeling of the  Product for use in such clinical studies.   5.2 Development Responsibilities of Haisco.  Subject to the general oversight of the  Steering Committee, Haisco shall have sole responsibility for and have sole right to carry out, the  performance of, and unless otherwise expressly set forth in this Agreement, the sole cost of, the  Development activities described below:  5.2.1 Clinical Studies.  Haisco shall be solely responsible for, and have sole  right to perform, the Development required to obtain the Regulatory Approvals and any post- approval maintenance of Regulatory Approvals for the Product in the Field in the Territory  including, without limitation, any Phase IV commitments, periodic safety reviews, annual  reports, regulatory submissions, and the development and implementation of a  pharmacovigilance program. Haisco shall provide Aquestive data and documents relating to such  Product Development and post-approval maintenance of the Regulatory Approvals requested by  Aquestive, to the extent in Haisco’s possession or Control. Haisco shall have no right to develop  the Product formulation itself.  In the event that Regulatory Authorities require any modification  to the Product formulation, Aquestive shall, at Haisco’s sole cost and expense, assess the  feasibility of such modifications to the Product formulation and if feasible, engage in  development of the Product formulation and shall deliver the necessary information and  documents to Haisco in accordance with the requirements of the Regulatory Authorities.  





 






BUSINESS.29027546.1         17    5.2.2 Regulatory Activities. The Marketing Authorization Holder for the  Product in the Territory shall initially be Aquestive and will, if and to the extent legally  permissible, be transferred and continue to be held in Haisco’s name. Haisco shall be responsible  for preparing and filing all regulatory applications and documents in the Territory.  Haisco shall  be solely responsible for the conduct of, have sole right to conduct, and shall use Commercially  Reasonable Efforts to, in consultation with Aquestive, conduct: all Development activities in  connection with or as a condition of seeking or obtaining and maintaining Regulatory Approval  of the Product in the Territory, including without limitation, preparing and filing all regulatory  applications and documents in the Territory, the meetings with Regulatory Authorities in the  Territory, the submission and maintenance of each Regulatory Approval Application and  preparation and submission of any supplements thereto, conducting periodic safety reviews, all  submissions to the Regulatory Authorities in the Territory, any post-marketing obligations  required by the Regulatory Authorities, and the development and implementation of a  pharmacovigilance program specific to the Product in the Field in the Territory in compliance  with all Applicable Law.  Haisco shall be responsible and pay for one hundred percent (100%) of  the costs and expenses incurred in connection therewith unless otherwise specifically provided  for in this Agreement, and shall reimburse Aquestive as applicable for any costs incurred by  Aquestive therewith, including but not limited to regulatory related fees, annual product fees, and  establishment fees.  Haisco shall designate a regulatory liaison to report to the Steering  Committee on the status of regulatory activities, including material communications with all  Regulatory Authorities in the Territory, on an as-needed basis as determined by the Steering  Committee.  At no cost to Aquestive, Haisco shall provide Aquestive with a copy of its annual  report in English for safety and Adverse Events filed with the applicable Regulatory Authority,  on an annual basis; provided that: (i) Aquestive and Haisco shall have entered into a  pharmacovigilance agreement in form and substance mutually agreed to in writing by Aquestive  and Haisco; and (ii) Aquestive shall provide Haisco with a copy of equivalent reports for safety  and Adverse Events filed with the applicable Regulatory Authority outside the Territory in  English, on an annual basis.  Haisco shall file each Regulatory Approval Application based on  the clinical studies required by the applicable Regulatory Authority in accordance with  Applicable Law.  Haisco shall provide the Steering Committee with reasonable advance notice of  Haisco’s intent to file any Regulatory Approvals for the Product.  At Haisco’s written request, or  if a Regulatory Authority in the Territory requires in writing, in connection with the Regulatory  Approval or Regulatory Approval Application for the Product in the Territory additional pre- clinical, non-clinical, clinical, and CMC Data beyond the data transferred by Aquestive pursuant  to Section 4,  Aquestive shall undertake defined regulatory activities within the timeframe  specified by the applicable Regulatory Authority or as otherwise agreed by the Parties in writing,  including without limitation, conducting additional CMC studies if required by the Regulatory  Authority, meetings with Regulatory Authorities and the preparation and submission of each  Regulatory Approval Application for the Product in the Territory; provided, that: (a) Aquestive  will provide Haisco with reasonable cost estimates and the parties mutually agree in writing to  execute a Statement of Work for these activities prior to the commencement of such work; and  (b) subject to the foregoing, Haisco will pay Aquestive for the conduct of such activities in  accordance with the applicable Statement of Work.    





 






BUSINESS.29027546.1         18    5.3 Changes.    5.3.1 Haisco shall have the right, upon prior written notice to Aquestive, to  change the labeling or packaging for the Product; provided that changes to the Product Label  shall be subject to Aquestive’s written consent. For the avoidance of doubt, however, a change  concerning quantities within a package made in compliance with Applicable Law shall not be  deemed a change to the Product Label and can be made at the sole discretion of Haisco.  Upon  delivery of such written notice, the Parties will mutually agree in good faith upon a written  Statement of Work that shall include a reasonable timeframe for implementation of such  changes, including without limitation, giving effect to the use of the remaining work-in-process  and any Raw Materials and packaging materials in-process or held in inventory by Aquestive  prior to effecting such change and a  reasonable estimate of the additional costs and expenses to  be reimbursed as a result of the implementation of such changes.  Subject to the foregoing, such  changes shall be at Haisco’s sole cost and expense (including the cost of any inventory, work-in- process, Raw Materials, documentation updates and packaging materials of Aquestive which  become obsolete or unusable as a result of such request to the extent detailed in the applicable  Statement of Work, in each case, to the extent reasonable or as otherwise agreed to in writing by  Aquestive and Haisco).  Aquestive shall not be required to make any such change if: (a) it  requires any material capital investment by Aquestive; or (b) it results in any cost increases  (including manpower allocations or resources) to Aquestive that is not reimbursed by Haisco.  Notwithstanding the foregoing, cost and expenses incurred in connection with change(s) to cure  a non-conformity of the label and package of the Product with the Primary Packaging Design  specifications shall be borne by Aquestive.  5.3.2 Either Party shall have the right to request that a change be made to the  Specifications for the Product upon prior written notice to, and subject to the approval of, the  other Party and, if approved, the Parties shall agree in writing on a reasonable timeframe for  implementation of such changes.  If either Party proposes making any material changes in the  Specifications for the Product, such Party shall give the other Party at least sixty (60) days prior  written notice of the proposed change unless such change is required because of regulatory  requirements or product performance concerns, or the availability or quality of the Product  components, in which case such notice shall be provided as soon as reasonably possible.  The  other Party shall promptly, but no later than within thirty (30) days after receiving such written  notice, inform the notifying Party in writing of any objections to the proposed change, including  any changed validation requirements necessary to accept such proposed change.  In no event  may any change in the Specifications of the Product be implemented except in compliance with  Applicable Law.  Neither Haisco nor Aquestive shall refuse without good and reasonable cause  implementation of a proposed change in the Specifications that is or would be otherwise allowed  by Regulatory Authorities and that does not affect the Product Transfer Price or the performance  of the Product and Aquestive shall not refuse the implementation of a proposed change requested  by Haisco if Haisco agrees in a prior written consent to pay the increase in the Product Transfer  Price attributable to such change.  6. COMMERCIALIZATION  6.1 Haisco Responsibility and Control.  Except as otherwise expressly set forth  herein, subject to the general oversight of the Steering Committee, Haisco shall have sole  





 






BUSINESS.29027546.1         19    responsibility for and the sole right to perform all Commercialization activities for the Product in  the Territory, including developing strategies and tactics related to the advertising, promotion,  pricing, marketing, and selling the Product.  Haisco shall comply and shall use Commercially  Reasonable Efforts to require all of its Third Party sublicensees, agents and contractors, if any, to  comply, with all Applicable Law in Commercializing the Product in accordance with this  Agreement.  6.2 Specific Commercialization Rights and Obligations of Haisco.  Subject to any  conditions or limitations set forth herein, it shall be Haisco’s sole right and responsibility to  perform the Commercialization activities for the Product in the Field in the Territory, which may  include without limitation, the activities set forth on Schedule 6.2. For the avoidance of doubt,  subject to the general oversight of the Steering Committee, Haisco shall have the sole decision- making authority regarding the activities to be performed for the Commercialization of the  Product in the Field in the Territory.  6.3 Product Launch and Market Coverage.  Haisco will use its best efforts to  launch the Product within the Territory within ninety (90) days of receipt of the Marketing  Authorization   6.4 Commercialization and Marketing Expenses.  Haisco shall be responsible for  and pay one hundred percent (100%) of all costs and expenses incurred in connection with the  Commercialization of the Product in the Territory, including, without limitation: (a) marketing,  advertising, sampling, and promotional activities; (b) marketing studies; (c) primary and  secondary market research; (d) promotional materials; and (e) samples.    6.5 Annual Stability Testing.  If any annual stability testing on Product is required  by any Regulatory Authority in the Territory where the Product is or has been commercially  sold, Haisco shall be responsible for all costs associated with the maintenance of annual stability.   Aquestive shall use Commercially Reasonable Efforts to cooperate with Haisco, at the sole cost  and expense of Haisco, to provide such documentation, methodologies and other information  reasonably necessary to conduct any stability testing performed by Haisco.  In the event that  Haisco wishes to retain Aquestive to provide any such stability testing, the Parties will negotiate  a separate written Statement of Work setting forth any services to be provided and associated  fees in connection therewith.     7. MANUFACTURING  7.1 Commercial Supply Obligations.  Subject to the terms and conditions of this  Agreement, during the Term, Aquestive shall exclusively Supply Haisco and Haisco’s Affiliates  and sublicensees with, and Haisco shall exclusively purchase from Aquestive, all of Haisco’s and  its Affiliates’ and sublicensees’ requirements of the Product for commercial sale in the Territory  during the Term, pursuant to binding purchase orders delivered by Haisco or its Affiliate to  Aquestive in accordance with Section 7.3 (“Purchase Orders”).  Aquestive shall Supply Product  to Haisco in Units (single dosage strips packaged according to Product and/or sample  Specifications and bulk packed for shipment) in accordance with the terms and conditions of this  Agreement, Applicable Law, and the Specifications.  





 






BUSINESS.29027546.1         20    7.2 Product Transfer Price.  Aquestive shall Supply quantities of each Unit of the  Product to Haisco at an initial transfer price of [***] per Unit (as same may be adjusted under  this Agreement, the “Product Transfer Price”); provided, however, that (i) for orders placed  subsequent to an event where a Generic Product is launched in the Field in the Territory by a  Third Party, or (ii) orders placed subsequent to an event where the Product is listed in the  National Reimbursement List with a price cut required, the Transfer Price shall be reduced by  [***] per dose. Aquestive may, after notification to Haisco and good faith discussions with  Haisco, increase the Product Transfer Price providing Haisco not less than sixty (60) days  written notice of any such proposed increase no more than once annually: (a) by the rate of price  increase (if any) indicated by the Producer Price Index applicable to pharmaceutical preparations  published by the U.S. Bureau of Labor Statistics, Department of Labor (or any applicable  successor index to be agreed to by the Parties in good faith in the event of the discontinuation of  same) over the prior twelve (12) month period; and (b) to the extent necessary to cover actual  increases in the event that the Unit cost of goods of the Product (determined based on the market  price of Aquestive’s Raw Materials) increases by a percentage greater than the change in the  Producer Price Index referenced in clause (a) hereof, as evidenced by relevant supporting  documents provided, however, any such price increase shall apply prospectively only and shall  not apply to Product subject to binding Purchase Orders. Notwithstanding the foregoing, in the  event that there will not be reasonable margin for Haisco due to the increase of Product Transfer  Price, at the request of Haisco, the Parties shall discuss in good faith adjustment of Product  Transfer Price and actions to be taken to control the cost of goods of the Product. Aquestive shall  decrease the Product Transfer Price by the rate of price decrease (if any) indicated by the  Producer Price Index applicable to pharmaceutical preparations published by the U.S. Bureau of  Labor Statistics, Department of Labor (or any applicable successor index to be agreed to by the  Parties in writing in good faith in the event of the discontinuation of same) over the prior twelve  (12) month period within sixty (60) days after the date that Haisco is eligible for such price  decrease; provided, however, any such price decrease shall occur no more than once annually,  shall apply prospectively only and shall not apply to Product subject to binding Purchase Orders.  Haisco will issue purchase orders in whole batch increments or as otherwise agreed to by the  Parties. In the event that the Product is listed in the National Reimbursement List with a price cut  of more than [***] of the then current price, the Parties will discuss in good faith adjustment of  the Product Transfer Price.  7.3 Forecasts, Order and Delivery of Product.    7.3.1 In order to assist Aquestive in planning production, Haisco shall deliver to  Aquestive in advance of each Calendar Quarter a supply forecast that includes the quantities of  each Product and Primary Packaging Design (including samples) required by Haisco, its  Affiliates and/or sublicensees by month for the next twelve (12) months.  The first such forecast  for the Product shall be delivered within a mutually agreed timeframe in writing in advance of  the commercial launch of the Product in the Territory, and thereafter on the first Business Day of  each February, May, August, and November of each calendar year during the Term for the  immediately succeeding Calendar Quarter. Aquestive shall, no later than five (5) Business Days  after receipt of each such forecast, notify Haisco in writing of any objections or prospective  problems in meeting Haisco’s forecasted requirements; provided however, that such objections  or prospective problems can be raised only if and to the extent the forecasted requirements with  





 






BUSINESS.29027546.1         21    regard to the applicable month exceeds [***] of forecasted requirements with regard to the same  month set forth in the immediately preceding supply forecast.  7.3.2 Haisco shall furnish to Aquestive binding Purchase Orders on a monthly  basis corresponding to the first three (3) months of the most recent supply forecast.  Each such  Purchase Order shall designate the Unit quantity of the Product ordered and the requested date of  delivery of the Product to Haisco.  Haisco shall furnish Purchase Orders by the fifth (5th)  Business Day of each month and a minimum of sixty (60) days prior to the requested delivery  date.  Each Purchase Order shall be in whole batch increments of Units and Primary Packaging  Design based on batch sizes and minimum orders as mutually agreed in writing by the Parties.   The Parties agree that no provision of any Purchase Order, invoice or of any confirmation or  acknowledgement or any other documentation or forms submitted by either Party to the other  Party shall be controlling to the extent it sets forth any terms or conditions that are additional to,  or in conflict or inconsistent with, the terms or conditions of this Agreement, unless otherwise  agreed by the Parties in writing. Aquestive shall accept each Purchase Order from Haisco so long  as such Purchase Order is furnished in accordance with this Section 7.3.2 and makes reference  that such Purchase Order is being furnished pursuant and subject to this Agreement.  7.3.3 An individual Purchase Order shall be deemed fulfilled with respect to the  quantity requirements as long as no less than [***] and no more than [***] of the quantities are  delivered against the individual Purchase Order.  For any delivery that delivers less than [***]   of the quantities set forth in the applicable Purchase order, Aquestive shall deliver such quantity  of conforming Product that is equal to the difference between the number of Units delivered and  the number of Units ordered in the applicable Purchase Order in accordance with Section 7.8.  Haisco agrees to accept delivery of up to [***] of the requested Purchase Order. For any delivery  that delivers more than one [***] of the quantities set forth in the applicable Purchase Order,  Haisco will retain such quantity of Product that is equal to the difference between the number of  Units delivered and the number of Units ordered in the applicable Purchase Order at Haisco’s  sole cost and adjust the prospective supply forecast accordingly, provided that Aquestive shall be  responsible for any material, documented, incremental, out-of-pocket storage costs incurred by  Haisco as a result of delivery of Product in excess of [***] of any Purchase Order. In the event  that any Purchase Order is more than [***] of the amounts set forth in the most recent supply  forecast, Aquestive shall use Commercially Reasonable Efforts to Supply such excess amounts  but shall not be liable for its inability to do so.   7.3.4 Aquestive shall deliver Product set forth in each Purchase Order Ex Works  (Incoterms 2020 edition, published by the International Chamber of Commerce and any  successor thereto) at the applicable manufacturing facility to Haisco’s designated carrier as  specified by Haisco in the applicable Purchase Order or otherwise notified in writing to  Aquestive by Haisco.    7.4 Invoice.  Aquestive shall invoice Haisco at the Product Transfer Price for all  quantities of Product delivered in accordance herewith.  Each invoice shall be substantially in the  form attached hereto as Schedule 7.4 (a “Commercial Invoice”) and shall be delivered at least  three (3) days prior to each shipment of Product, and shall be accompanied by a Certificate of  Analysis, Certificate of Compliance, certificate of origin and any other documentation required  by the applicable Regulatory Authorities or by Applicable Law to Commercialize or import the  





 






BUSINESS.29027546.1         22    Product in the Territory. Payments shall be made in accordance with Section 8.5, and shall be  due within forty-five (45) days after the date of a Commercial Invoice with respect to Product  delivered, subject to the procedure for rejected shipments set forth in Section 7.5.  In the event  that any Commercial Invoice is disputed by a Party, the Parties shall meet to discuss and submit  any relevant document necessary for clarifications.  7.5 Product Not in Compliance.  Within forty-five (45) days after delivery of the  Product at the applicable manufacturing facility to Haisco’s designated carrier, Haisco or its  agent shall perform a reasonable physical examination of the Product, the Certificates of  Analysis, the Certificate of Compliance, and other documentation, if any, provided with each  shipment of Product, and shall determine whether such Product meets the Specifications and the  applicable Purchase Order.  If Haisco does not submit written notice that the Product does not  meet the Specifications and Purchase Order, including the reasons therefore, within forty-five  (45) days after delivery of the Product at the applicable manufacturing facility to Haisco’s  designated carrier, such Product shall be deemed accepted by Haisco; provided, however, that  such acceptance or deemed acceptance shall not adversely affect any claim: (i) in respect of a  latent defect (whether prior to or after acceptance of the Product) discovered within two (2) years  of delivery at the applicable manufacturing facility to Haisco’s designated carrier; (ii) for  indemnification provided in Section 11; or (iii) in respect of a defect determined by the customs  authorities in the Territory or the NMPA attributable to Aquestive and not Haisco or its  subcontractors, sublicensees or agents.  If Haisco and Aquestive do not agree on the rejection of  Product, then either Party may refer the matter for final analysis to an independent Third Party  laboratory of international reputation pursuant to Section 7.6 for the purpose of determining the  results.  7.6 Independent Testing.  If Aquestive disagrees with Haisco’s rejection of any  shipment of the Product, then the Product shall be submitted to an independent Third Party  laboratory of international reputation, mutually and reasonably acceptable to both Parties in  writing, for analytical testing to determine the extent of the Product’s compliance or non- compliance with the Specifications.  Any determination by such Third Party laboratory will be  final and binding upon the Parties.  The fees and expenses of such laboratory testing and all other  related expenditure incurred as a result of the dispute shall be borne entirely by the Party against  whom such laboratory’s findings are made.  7.7 Return or Destruction of Non-Conforming Product.  Notwithstanding any  other provisions of this Agreement, Haisco agrees to return to Aquestive, or at Aquestive’s  direction, dispose of such Product (including Products with any latent defects and/or defects  determined by the customs authorities in the Territory or the NMPA) as Haisco and Aquestive  may agree, any Product, in any such case at Aquestive’s sole cost, that: (a) does not conform  with the Specifications at the time of the Product at the applicable manufacturing facility to  Haisco’s designated carrier; (b) is not in compliance with the Purchase Order (except as to  quantity) as set forth in Section 7.5; or (c) if Haisco and Aquestive otherwise mutually agree in  writing.  Aquestive shall be responsible for the costs associated with the return and/or proper  disposal of all such Product not in conformance with the Specifications at the time of shipment  and shall, at the option of Haisco, promptly replace (at Aquestive’s sole cost) such shipment of  Product to conform to the applicable Specifications and Purchase Order but in no event later than  





 






BUSINESS.29027546.1         23    thirty (30) days after (a) notified of such non-conformity or non-compliance, or (b) the date that  Haisco and Aquestive otherwise agree in writing.  7.8 Raw Material and Safety Stock. Within sixty (60) days after the First  Commercial Sale, Aquestive will establish and at all times during the term of this Agreement  maintain a safety stock of Raw Materials in quantities sufficient to satisfy Haisco’s requirements  for Products for the succeeding ninety (90) days based on Haisco’s most recent quarterly forecast  delivered pursuant to Section 7.3.1 (“Raw Materials Safety Stock”). Deliveries by Aquestive to  Haisco of Product may use the Raw Materials Safety Stock. Aquestive shall keep Haisco  reasonably informed of the level of Raw Materials safety stock. If the Raw Materials Safety  Stock drops below a ninety (90) day supply, Aquestive shall replenish the Raw Materials Safety  Stock as quickly as practicable.  7.9 Delivery Failure.  7.9.1 Where the quantity of conforming Product delivered is less than [***] of  the amount required by the relevant binding Purchase Order, the Parties shall enter into good  faith discussions regarding the cure of such delivery shortfall, and, unless otherwise agreed in  writing by Haisco, in the event of any such Product shortfall resulting in delivery of less than  [***] of the amount of Product required by a binding Purchase Order or the Product is not  delivered on the delivery date set forth in such binding Purchase Order (“Delivery Failure”),  Aquestive shall cure such Product shortfall as soon as reasonably practicable after the original  delivery date in accordance with such delivery schedule as may be mutually agreed between the  Parties and in any event no later than with the next delivery of Product as set forth in the relevant  binding Purchase Order (each, a “Rescheduled Delivery Date”).  7.9.2 In the event a Delivery Failure continues after a Rescheduled Delivery  Date, provided that the reason for the Delivery Failure is not due in whole or in part to any delay,  fault or failure attributable to Haisco or a dispute covered by Section 7.5, by written notice to  Aquestive Haisco shall be entitled to (i) require Aquestive to prioritize its manufacturing  capacity (if the Delivery Failure is a result of a deficiency in Aquestive’s manufacturing  capacity) to ensure the Delivery Failure is cured no later than sixty (60) days after receipt of such  written notice by Aquestive; (ii) cancel such binding Purchase Order (or the relevant portions  thereof) without penalty to Haisco; and (iii) recover any expedited shipping fees actually  incurred by Haisco as a direct result of such Delivery Failure, in each only if such Delivery  Failure results in Haisco can establish that it will have insufficient inventory of Product to satisfy  forecasted customer orders for the succeeding sixty (60) days.  7.9.3 Notwithstanding anything in this Section 7.9 or elsewhere in this  Agreement to the contrary, any delay in delivery to the extent due to Force Majeure, Haisco’s  requested change of a binding Purchase Order, or any gross negligence on the part of Haisco  shall not be regarded as Delivery Failure.  





 






BUSINESS.29027546.1         24    7.10 Inspections.  Aquestive shall, and shall cause its Affiliates and the Third Party  API supplier(s) that are involved in the Supply for use in the Territory to, cooperate and allow  representatives of any Regulatory Authority to inspect the relevant parts of the facility where the  manufacture of the API or Product is carried out as required by Applicable Law and shall  promptly notify Haisco of the scheduling of any such inspection relating to Supply, in each case,  at Aquestive’s sole cost and expense.  Upon reasonable advance written notice during the Term,  Aquestive shall, and shall use Commercially Reasonable Efforts to cause other Third Parties that  are involved in the Supply for use in the Territory to, permit any Regulatory Authority to inspect  the relevant parts of the facility where the manufacture and Supply of any API or Product is  carried out in order to assess quality issues with any Product and Aquestive’s and such Third  Parties’ compliance with Applicable Law, in each case, at Aquestive’s sole cost and expense.   7.11 Samples.  If Haisco desires to obtain Product to be used as samples to be  distributed to prescribers for the benefit of patients in the Territory, Haisco shall order such  Product samples under Purchase Orders separate from the Product for sale, as otherwise  approved by the Steering Committee.  Haisco agrees that it shall use and distribute Product  samples in compliance with all Applicable Law, and Aquestive shall be entitled to, at  Aquestive’s sole cost and expense, conduct an inspection and audit of the Product sample  distribution practices by Haisco in the Territory.    7.12 Quality Agreement.  In connection with the manufacturing activities of the  Product under this Agreement, Haisco and Aquestive will enter into one or more agreements that  detail the quality assurance obligations of each Party with respect to the manufacture and supply  of the Product by Aquestive which agreements shall be drafted in English (the “Quality  Agreement”). Notwithstanding the foregoing, neither the Quality Agreement, nor the absence of  a Quality Agreement, shall affect the rights and obligations of the Parties under this Agreement  or limit Aquestive’s ability to release batches of Product conforming to the Specifications. The  Parties shall amend the Quality Agreement from time to time, as the Parties deem necessary.   The Quality Agreement, as may be amended from time to time, is hereby incorporated by  reference into and made part of this Agreement. In the event of conflict between terms of a  Quality Agreement and the terms of this Agreement, the terms of this Agreement will govern  with respect to all matters.  7.13 Adverse Event and Safety Reporting.  Prior to the First Commercial Sale, the  Parties will enter into a written Safety Data Exchange Agreement with respect to the Product  which is hereby incorporated by reference into and made part of this Agreement.   Notwithstanding anything to the contrary contained in this Agreement, Haisco shall be  responsible for making all reports of Adverse Events to the applicable Regulatory Authority.   8. PAYMENTS AND REPORTS   8.1 Milestone Payments.  A one-time non-refundable payment will be due from  Haisco to Aquestive in consideration of the first achievement of the following events (the  “Events”):  





 






BUSINESS.29027546.1         25    Event Milestone  Payment  (U.S. Dollars) Date Payment Due  1.    Execution of this Agreement  $7,000,000 The earlier to occur of :  (i) sixty (60) days after  the Effective Date; and  (ii) five (5) Business  Days following the date  on which tax filings with  the applicable  governmental authorities  to release the payment  has been completed   2. Receipt of the Marketing Authorization for the  Product in the Territory.  [***]  Within forty-five (45)  days after the later of: (i)  the achievement of the  milestone; and (ii) the  date on which Haisco  has received the  Commercial Invoice  with respect thereto  8.2 Notice; Payment.  Haisco shall deliver written notice to Aquestive of the  achievement of the Event 2 set forth in Section 8.1 within Haisco’s responsibility within three  (3) Business Days after the achievement of Event 2 by Haisco or its Affiliates.   8.3 Royalties.  During the Term, and in addition to any payments set forth in  Sections 7.2 and 8.1, Haisco shall pay to Aquestive a royalty payment of Net Sales of each  Product in a given Royalty Period in the Territory as set forth below:   Amount of Net Sales during a Calendar Year Royalty Rate* as  Percentage of Net Sales  1. Less than and including [***]  [***]   2. Above US $20,000,000 up to and including [***]  [***]   3. Greater than [***]  [***]   For the avoidance of doubt, if the amount of Net Sales in the Territory in a given calendar year  equals [***], the royalty payment owed by Haisco to Aquestive pursuant to this Section 8.3 for  such calendar year would be [***], which is calculated as follows: [***].  *Once a Generic Product is for sale in the Territory (to the extent such Generic Product entry has  resulted in a reduction in the commercial price of the Product in the Territory), the royalty rate in  this Section 8.3 with respect to Net Sales for the Product will be adjusted to [***] of the then  current royalty rate.  8.4 Minimum Payment Commitment.  In the event, in any full calendar year,  Haisco’s annual composite payments to Aquestive (including Product Transfer Price and  royalties) under this Agreement in such calendar year for the Product is less than the minimum  amount set forth for such calendar year below (the “Minimum Payment Commitment”), then  





 






BUSINESS.29027546.1         26    unless such failure is attributable to the failure of Aquestive to supply conforming Product to  Haisco under this Agreement (which amount shall be subtracted from the amount that Haisco  shall pay pursuant to this Section 8.4), Haisco shall pay the differential (between actual amounts  paid or payable to Aquestive in such calendar year and the Minimum Payment Commitment)  within forty-five (45) days after the later of: (i) the date of the applicable Royalty Report, or (ii)  the date on which Haisco has received the Commercial Invoice with respect thereto:  Event Minimum  Payment  Commitment  (U.S. Dollars)  1. First Year After Marketing Authorization is Granted [***]   2. Second Year After Marketing Authorization is Granted                                                   [***]   3. Third Year After Marketing Authorization is Granted                                                   [***]   4. Fourth Year After Marketing Authorization is Granted  [***]   5. Fifth Year After Marketing Authorization is Granted and  Beyond  [***]     Haisco’s obligation to pay the Minimum Payment Commitment shall commence from  and after the date Haisco receives the Marketing Authorization.  8.5 Haisco Royalty Reports and Payments.  During the Term after the commercial  launch of the Product in the Field in the Territory, Haisco shall submit royalty reports (each, a  “Royalty Report”) to Aquestive within twenty (20) days following the end of each Royalty  Period.  Each Royalty Report shall cover the most recently completed Royalty Period and shall  show: (a) the aggregate gross and Net Sales of the Product during the most recently completed  Royalty Period, including reasonable detail with respect to the calculation of Net Sales, units  sold, discounts, credits and other components in the calculation of Net Sales; (b) the royalties, in  Chinese Yuan, payable with respect to such Net Sales, provided however, that with respect to the  fourth Royalty Report, such royalties payable shall be adjusted based on the royalty rate  applicable to the amount of Net Sales during such calendar year, and the amount of royalties paid  following the issuance of the second Royalty Report. Within forty five (45) days after the later  of: (i) the date upon which the second Royalty Report and the fourth Royalty Report,  respectively, in a given semi-annual period in a calendar year during the Term are furnished;  provided however, that with respect to the amount of payment following the second Royalty  Report, (x) if the aggregate Net Sales falls within Tier 1, the aggregate amount payable shall not  exceed [***] ; (y) if the aggregate Net Sales falls within Tier 2, the aggregate amount payable  shall not exceed [***] ; and (ii) the date on which Haisco has received the electronic Commercial  Invoice issued to Haisco with respect to the applicable amounts, Haisco shall pay to Aquestive a  sum equal to the payment shown as due on such Royalty Reports calculated in accordance with  this Agreement.  8.6 Manner of Payment.  All sums due under this Agreement shall be payable in  U.S. dollars by bank wire in immediately available funds to such bank account(s) as Aquestive  shall designate in writing.  All amounts due to Aquestive hereunder not paid within thirty (30)  





 






BUSINESS.29027546.1         27    days of the date due shall bear interest at the rate equal to [***] per annum or at the highest rate  permitted by Applicable Law, whichever is less.  8.7 Bartering Prohibited.  Haisco and its Affiliates and sublicensees shall not solicit  or accept any bartered goods or services in exchange for the sale or transfer of the Product.  8.8 Taxes and Withholding.  8.8.1 Each Party shall be responsible for its own tax liabilities arising under this  Agreement and Aquestive shall be liable for all of its income taxes (including interest) imposed  upon any payments made by Haisco to Aquestive under this Agreement.  8.8.2 If Haisco is required by Applicable Law to withhold taxes, Haisco will: (a)  increase the amount so that the amount actually paid to Aquestive (after withholding of such  taxes) equals the amount initially payable to Aquestive under this Agreement; (b) pay to the  relevant authorities the full amount otherwise required to be deducted or withheld promptly upon  determining that such deduction or withholding is required; and (c) forward to Aquestive an  official receipt (or certified copy) or other documentation reasonably acceptable to Aquestive  evidencing such payment to such authorities.   8.8.3 The Parties agree to cooperate with one another and use reasonable efforts  to reduce or eliminate tax withholding or similar obligations in respect of royalties, milestone  payments, and other payments made by Haisco to Aquestive under this Agreement. Each Party  shall provide the other with reasonable assistance to enable the recovery, as permitted by  Applicable Law, of withholding taxes, value added taxes, or similar obligations resulting from  payments made under this Agreement, such recovery to be for the benefit of the Party bearing  such withholding tax or value added tax.  8.9 Accounting.  All financial terms and standards defined or used in this Agreement  for sales or activities occurring in the Territory shall be governed by and determined in  accordance with the Chinese Accounting Standards, including the calculation of Net Sales and  royalties due Aquestive hereunder; provided that when the actual results become known in  accordance with the Chinese Accounting Standards relative to any accrued amount, any  difference between the actual results and the accrual is reported and accounted for in the next  payment due hereunder (subject to customary processing periods).  To the extent that the  difference between such accruals and the actual results has led to an underpayment, Haisco shall  pay Aquestive the amount of such underpayment on the next date payment is due to Aquestive  hereunder.  To the extent that the difference between such accruals and the actual results has led  to an overpayment, Aquestive shall deduct such amount from the next payment due to Aquestive  under this Agreement, provided that if there are no future payments due to Aquestive under the  Agreement, Aquestive shall refund such amount to Haisco within forty-five (45) days after the  determination that an overpayment has been made.   8.10 Record Keeping; Audits.  Haisco and its Affiliates shall keep books and  accounts of record in connection with Net Sales of the Product in sufficient detail to permit  accurate determination of all figures necessary for verification of royalties to be paid hereunder.   Haisco and its Affiliates shall retain such records for a period of at least seven (7) years after the  





 






BUSINESS.29027546.1         28    end of the Calendar Quarter in which they were generated; provided, however, that if any records  are in dispute and Haisco has received written notice from Aquestive of the records which are in  dispute, then Haisco and its Affiliates shall keep such records until such dispute is resolved.  No  more than once in the first calendar year after the commercial launch of the Product in the Field  in the Territory and no more than once per calendar year thereafter, upon reasonable advance  written notice to Haisco, Aquestive will have the right to engage an internationally recognized  public accounting firm chosen by Aquestive and reasonably acceptable to Haisco (which  accounting firm will not be the external auditor of Aquestive, will not have been hired or paid on  a contingency basis and will have experience auditing pharmaceutical companies) (a “CPA  Firm”) to conduct an audit of such books and records of Haisco to determine the correctness of  the amount of royalties paid to Aquestive under the terms of this Agreement. The CPA Firm will  be given access to and will be permitted to examine such books and records of Haisco only to the  extent necessary for verification of royalties to be paid hereunder, upon thirty (30) days’ prior  written notice having been given by Aquestive, during regular business hours, for the sole  purpose of determining compliance with the Net Sales royalty provisions of this Agreement.   Prior to any such examination taking place, the CPA Firm will enter into a confidentiality  agreement reasonably acceptable to Haisco and Aquestive with respect to the Confidential  Information to which they are given access and will not contain in its report or otherwise disclose  to Aquestive or any Third Party any information labeled by Haisco as being confidential  customer information regarding pricing or other competitively sensitive proprietary information.  Aquestive and Haisco will be entitled to receive a full written report of the CPA Firm with  respect to its findings to the extent relevant to verification of royalties to be paid hereunder and  Aquestive will provide, without condition or qualification, Haisco with a copy of the report, or  other summary of findings, prepared by such CPA Firm promptly following Aquestive’s receipt  of same.  In the event of any dispute between Aquestive and Haisco regarding the findings of any  such inspection or audit, the Parties will initially attempt in good faith to resolve the dispute  amicably between themselves, and if the Parties are unable to resolve such dispute within thirty  (30) days after delivery to both Parties of the CPA firm’s report, each Party will select an  internationally recognized independent certified public accounting firm (other than the CPA  Firm), and the two firms chosen by the Parties will choose a third internationally recognized  independent certified public accounting firm which will resolve the dispute, and such accounting  firm’s determination will be binding on both Parties absent manifest error by such accounting  firm.  All costs and expenses of such auditor incurred in connection with performing any such  audit shall be paid by Aquestive unless such audit discloses an underpayment of at least ten  percent (10%), in which case Haisco shall bear such costs and expenses.  8.11 Underpayments and Overpayments.  If an audit conducted pursuant to  Section 8.10 reveals that additional royalties were due to Aquestive under this Agreement, then  Haisco shall pay to Aquestive the additional royalties within forty-five (45) days of the date  Haisco receives the Commercial Invoice with respect to such underpayment.  If an audit  conducted pursuant to Section 8.10 reveals that Aquestive was paid royalties in excess of those  royalties due to Aquestive under this Agreement, then Haisco shall be entitled to deduct such  amount from the next royalty payment due Aquestive under this Agreement, provided that if  there are no future royalty payments due to Aquestive under this Agreement, Aquestive shall  refund such amount to Haisco within forty-five (45) days of the date Aquestive receives written  notice of such overpayment.  





 






BUSINESS.29027546.1         29    8.12 Currency Conversion. Net Sales numbers will be converted from Chinese Yuan  to US Dollars applying a weighted average exchange rate based on monthly Net Sales.  This  calculation shall be based on (i) the three-month period associated with the applicable Royalty  Period and (ii) the published average exchange rate by the Board of Governors of the Federal  Reserve System (“Exchange Rate”) for the month in which such sales were made. For the  avoidance of doubt, the Net Sales numbers in US Dollars in a Royalty Period shall be calculated  as follows: Month 1 Net Sales in Chinese Yuan / Month 1 Exchange Rate + Month 2 Net Sales  in Chinese Yuan / Month 2 Exchange Rate + Month 3 Net Sales in Chinese Yuan / Month 3  Exchange Rate.  9. REPRESENTATIONS, WARRANTIES AND COVENANTS  9.1 Representations, Warranties and Covenants of Each Party.  Each Party  hereby represents and warrants as of the Effective Date to the other Party as follows:  9.1.1 Corporate Existence, Power, and Authority.  Such Party: (a) is duly  formed and in good standing under the laws of the jurisdiction of its formation; (b) has the power  and authority and the legal right to enter into this Agreement and perform its obligations  hereunder; and (c) has taken all necessary action on its part required to authorize the execution  and delivery of this Agreement and the performance of its obligations hereunder.  9.1.2 Binding Agreement.  This Agreement has been duly executed and  delivered on behalf of such Party and constitutes a legal, valid and binding obligation of such  Party and is enforceable against it in accordance with its terms subject to the effects of  bankruptcy, insolvency or other laws of general application affecting the enforcement of creditor  rights and judicial principles affecting the availability of specific performance and general  principles of equity, whether enforceability is considered a proceeding at law or equity.  9.1.3 Compliance with Applicable Law.  All necessary consents, approvals and  authorizations of all Regulatory Authorities and other Persons required to be obtained by such  Party in connection with the execution and delivery of this Agreement and the performance of its  obligations as of the Effective Date hereunder have been obtained.  9.1.4 No Conflict with Applicable Law.  The execution and delivery of this  Agreement, the performance of such Party’s obligations hereunder, and any actions or omissions  of such Party related to the activities contemplated hereunder and the circumstances surrounding  this Agreement: (a) do not and will not conflict with or violate any Applicable Law or any  provision of the articles of incorporation, bylaws or other governing charter documents of such  Party; and (b) do not and will not conflict with, violate, or breach, or constitute a default or  require any consent under, any contractual obligation or court or administrative order by which  such Party is bound.  9.1.5 No Conflict with Agreement.  Each Party agrees not to engage in any  action that is in violation or inconsistent with the terms and conditions of this Agreement or that  interferes with the consummation of the transactions contemplated under this Agreement.  9.1.6 Bankruptcy; Insolvency.  Neither Party is aware of any action or petition,  pending or otherwise, for bankruptcy or insolvency of such Party or its Affiliates or subsidiaries  





 






BUSINESS.29027546.1         30    in any state, country, or other jurisdiction, and it is not aware of any facts or circumstances that  could result in such Party becoming or being declared insolvent, bankrupt or otherwise incapable  of meeting its obligations under this Agreement as they become due in the ordinary course of  business.  9.2 Additional Aquestive Representations, Warranties and Covenants.  Aquestive  represents, warrants, and covenants to Haisco as follows:  9.2.1 Right to Grant Licenses.  Aquestive and its Affiliates owns or is the  exclusive licensee of the rights, title, and interest in and to the Aquestive Patents and have the  right to grant the licenses granted to Haisco herein.  9.2.2 Aquestive Patents and Aquestive IP.  The Aquestive Patents represent all  patents within Aquestive’s and its Affiliates’ Control relating to the Product, or the  Development, Supply or Commercialization thereof, as of the Effective Date. The Aquestive IP  is sufficient to enable Haisco in all material aspects to Develop in accordance with Section 5.1  and Commercialize the Product in the Field in the Territory.  9.2.3 Third Party Agreements.  Except in connection with commercial lending  arrangements, neither Aquestive nor any of its Affiliates is a party to or otherwise bound by any  oral or written contract or agreement that conflicts with, or limits the scope of, any of the rights  or licenses granted to Haisco hereunder or that will result in any Third Party obtaining any  interest in, or that would give to any Third Party any right to assert any claim in or with respect  to, any of Haisco’s rights under this Agreement.  9.2.4 Compliance with Applicable Law.  During the Term, Aquestive and each  manufacturing facility in which the Product is manufactured, shall comply with, and maintain in  force all licenses, consents, permits and authorizations necessary to perform its obligations under  this Agreement.  9.2.5 No Debarment.  None of Aquestive or its Affiliates have employed or  otherwise used in any capacity, and will not employ or otherwise use in any capacity, the  services of any Person debarred under United States law, including Section 21 U.S.C. 335a, or  any foreign equivalent thereof.   9.3 Additional Haisco Representations, Warranties and Covenants.  Haisco  further represents, warrants, and covenants to Aquestive that:  9.3.1 Right to Grant Licenses.  Haisco and its Affiliates have the right to grant  the licenses granted to Aquestive herein.  9.3.2 Third Party Agreements.  As of the Effective Date, neither Haisco nor any  of its Affiliates is a party to or otherwise bound by any oral or written contract or agreement that  will result in any Third Party obtaining any interest in, or that would give to any Third Party any  right to assert any claim in or with respect to, any of Aquestive’s rights under this Agreement.  9.3.3 Compliance with Applicable Law.  Haisco shall comply with and maintain  in force all licenses, consents, permits and authorizations necessary to perform its obligations  





 






BUSINESS.29027546.1         31    under this Agreement and shall perform its obligations under this Agreement in compliance with  Applicable Law.  9.3.4 Compliance with Anti-Bribery, Anti-Corruption, and Ethics Policies.   Haisco and its Affiliates shall comply with, and shall use Commercially Reasonable Efforts to  ensure that its sublicensees, subcontractors and agents comply with Applicable Anti Bribery and  Anti-Corruption Laws.  Haisco shall have and maintain in place through the Term its own  policies and procedures to the extent required by and in accordance with the Applicable Law.   Haisco will promptly report to Aquestive any request or demand for any undue or suspicious  financial or other advantage of any kind received by Haisco in connection with the performance  of this Agreement.   9.3.5 No Debarment.  None of Haisco or its Affiliates have employed or  otherwise used in any capacity, and will not employ or otherwise use in any capacity, the  services of any Person debarred under United States law, including Section 21 U.S.C. 335a, or  any foreign equivalent thereof.  9.4 Disclaimer.  EACH PARTY HEREBY DISCLAIMS ANY AND ALL  REPRESENTATIONS AND WARRANTIES IN CONNECTION WITH THE  TRANSACTIONS CONTEMPLATED HEREIN NOT EXPRESSLY MADE IN THIS  AGREEMENT TO THE MAXIMUM EXTENT PERMITTED UNDER APPLICABLE LAW,  INCLUDING WITH RESPECT TO THE PRODUCTS OR ANY TECHNOLOGY OR OTHER  INTELLECTUAL PROPERTY LICENSED OR GRANTED UNDER THIS AGREEMENT,  INCLUDING ANY WARRANTY OF NON-INFRINGEMENT, QUALITY, PERFORMANCE,  MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR ANY IMPLIED  WARRANTY ARISING FROM COURSE OF PERFORMANCE, COURSE OF DEALING OR  USAGE OR TRADE.  FOR THE AVOIDANCE OF DOUBT, NOTHING CONTAINED IN  THIS SECTION 9.4 SHALL OPERATE TO LIMIT OR INVALIDATE ANY EXPRESS  WARRANTY CONTAINED HEREIN OR ANY IMPLIED WARRANTY OF GOOD FAITH  AND/OR FAIR DEALING.  10. CONFIDENTIAL INFORMATION  10.1 General.  Pursuant to the terms of this Agreement, each of Aquestive and Haisco  (in such capacity, the “Disclosing Party”) has disclosed and will be disclosing to the other Party,  and to the Affiliates, officers, directors, employees, agents and/or representatives of each (in  such capacity, the “Receiving Party”) certain secret, confidential or proprietary data, Intellectual  Property and related information, including, without limitation, technical, scientific, business and  other information, data, materials and the like relating to drug applications, patent applications,  products, processes, formulations, manufacturing technology, samples, operating methods and  procedures, marketing, manufacturing, distribution and sales methods and systems, sales figures,  pricing policies and price lists and other business information (“Confidential Information”).  The  terms and conditions of this Agreement shall be considered Confidential Information.  Without  limiting the foregoing, it is acknowledged that the Aquestive IP shall constitute the Confidential  Information of Aquestive (subject to Section 10.3) for purposes of this Agreement.  The  Receiving Party shall make no use of any Confidential Information of the Disclosing Party  except in the exercise of its rights and the performance of its obligations set forth in this  





 






BUSINESS.29027546.1         32    Agreement.  The Receiving Party: (a) shall keep and hold as confidential, and shall cause its  officers, directors, employees, agents, and representatives to keep and hold as confidential, all  Confidential Information of the Disclosing Party; and (b) shall not disclose, and shall cause its  Affiliates, officers, directors, employees, agents, and representatives not to disclose, any  Confidential Information of the Disclosing Party. Confidential Information disclosed by the  Disclosing Party shall remain the sole and absolute property of the Disclosing Party, subject to  the rights granted in this Agreement or Applicable Law.  10.2 Prior Confidentiality Agreement.  As of the Effective Date, the terms of this  Section 10 shall supersede any prior non-disclosure, secrecy, or confidentiality agreement  between the Parties (or their Affiliates) relating to the subject of this Agreement, including the  Confidentiality Agreement, which is hereby terminated.  Any information disclosed pursuant to  any such prior agreement shall be deemed Confidential Information for purposes of this  Agreement.  10.3 Exceptions.  The above restrictions set forth in Section 10.1 on the use and  disclosure of Confidential Information shall not apply to any information which: (a) is already  known to the Receiving Party at the time of disclosure by the Disclosing Party, as demonstrated  by competent proof (other than as a result of prior disclosure under any agreement between the  Parties with respect to confidentiality); (b) is or becomes generally known or available to the  public other than through any act or omission of the Receiving Party in breach of this Agreement  (or any other agreement between the Parties with respect to confidentiality); (c) is acquired by  the Receiving Party from a Third Party who is not directly or indirectly under an obligation of  confidentiality to the Disclosing Party with respect to same, or (d) is developed independently by  the Receiving Party without the use, direct or indirect, of the Disclosing Party’s  Confidential  Information.  In addition, nothing in this Section 10 shall be interpreted to limit the ability of  either Party to disclose its own Confidential Information to any other Person on such terms and  subject to such conditions as it deems advisable or appropriate.  10.4 Permitted Disclosures.  It shall not be a breach of Section 10.1 if a Receiving  Party discloses Confidential Information of a Disclosing Party:  (a) pursuant to Applicable Law,  including securities laws applicable to a public company, to any Regulatory Authority or the  listing standards or agreements of any national or international securities exchange or The  NASDAQ Stock Market or other Governmental Authority; (b) in order to comply with its  obligations under the listing standards or agreements of any national or international securities  exchange or The NASDAQ Stock Market; or (c) in a judicial, administrative or arbitration  proceeding to enforce such Party’s rights under this Agreement; provided, however, that the  Receiving Party: (i) provides the Disclosing Party with as much advance written notice as  possible of the required disclosure; (ii) reasonably cooperates with the Disclosing Party in any  attempt to prevent, limit or seek confidential treatment for the disclosure; and (iii) discloses only  the minimum amount of Confidential Information necessary for compliance.  The Parties may  also disclose the existence of this Agreement and terms thereof to their directors, investors,  officers, employees, attorneys, accountants and other advisers on a need to know basis and may,  upon obtaining a written confidentiality agreement, further disclose the existence and terms of  this Agreement to third Parties to whom it may be relevant in connection with financings,  acquisitions, licenses and similar transactions to the extent such Third Parties are under  confidentiality obligations at least as restrictive as those set forth herein.  





 






BUSINESS.29027546.1         33    10.5 Equitable Remedies.  Each Party specifically recognizes that any breach by it of  this Section 10 may cause irreparable injury to the other Party and that actual damages may be  difficult to ascertain, and in any event, may be inadequate.  Accordingly (and without limiting  the availability of legal or equitable, including injunctive, remedies under any other provisions of  this Agreement), each Party agrees that in the event of any such breach, the other Party shall be  entitled to seek injunctive relief and such other legal and equitable remedies as may be available.  11. INDEMNIFICATION; LIMITATION OF LIABILITY  11.1 Indemnification by Haisco.  Haisco shall defend, indemnify and hold harmless  Aquestive and its Affiliates and each of their respective officers, directors, shareholders,  employees, successors and assigns (“Aquestive Indemnitees”) from and against all claims,  allegations, suits, actions or proceedings asserted against any Aquestive Indemnitee by any Third  Parties, whether governmental or private (“Third Party Claims”), and all associated Losses, to  the extent arising out of or resulting from: (a) the performance or failure to perform by Haisco  (or any of its Affiliates, sublicensees, subcontractors or agents) any of its obligations under this  Agreement; (b) a material breach by Haisco or any of its Affiliates, sublicensees, subcontractors  or agents of any of Haisco’s representations, warranties, covenants or agreements under this  Agreement; (c) the conduct of clinical studies or other Development activities related to the  Product in the Field in the Territory by or on behalf of Haisco; (d) the Commercialization by or  on behalf of Haisco of the Product in the Field in the Territory; or (e) violation of Applicable  Law by any Haisco Indemnitee. Notwithstanding the foregoing, in all cases referred to in the  preceding sentence, Haisco shall not be liable to indemnify any Aquestive Indemnitee for any  Losses of such Aquestive Indemnitee to the extent that such Losses were caused by: (i) the gross  negligence or willful misconduct or intentional wrongdoing of Aquestive or any of its Affiliates,  subcontractors or agents; (ii) any breach by Aquestive or any of its Affiliates, subcontractors or  agents of Aquestive’s representations, warranties, covenants or agreements under this  Agreement; or (iii) matters for which Aquestive has an obligation to indemnify any Haisco  Indemnitee pursuant to Section 11.2.  For the avoidance of doubt, Aquestive shall be entitled to  rely on Haisco’s sole judgment in fulfilling its obligations under Section 5.2 and Section 6.2 and  such reliance shall in no way limit Aquestive’s rights or Haisco’s obligations under this Section  11.1.        11.2 Indemnification by Aquestive.  Aquestive shall defend, indemnify and hold  harmless Haisco and its Affiliates and each of their respective officers, directors, shareholders,  employees, successors and assigns (“Haisco Indemnitees”) from and against all Third Party  Claims, and all associated Losses, to the extent arising out of or resulting from: (a) the  performance or failure to perform by Aquestive (or any its Affiliates, subcontractors or agents)  any of its obligations under this Agreement; (b) a material breach by Aquestive or any of its  Affiliates, subcontractors or agents of any of its representations, warranties, covenants or  agreements under this Agreement; (c) the conduct of development activities related to the  Product outside the Field or outside the Territory by or on behalf of Aquestive; (d) the  manufacture or Supply of API or Product by or on behalf of Aquestive; (e) the  Commercialization of the Product outside the Field or outside the Territory by or on behalf of  Aquestive; or (f) violation of Applicable Law by any Aquestive Indemnitee; provided, that, in all  cases referred to in this Section 11.2, Aquestive shall not be liable to indemnify any Haisco  Indemnitee for any Losses of such Haisco Indemnitee to the extent that such Losses were caused  





 






BUSINESS.29027546.1         34    by: (i) the gross negligence or willful misconduct or intentional wrongdoing of Haisco or any of  its Affiliates, subcontractors or agents; (ii) any breach by Haisco or any of its Affiliates,  subcontractors or agents of Haisco’s representations, warranties, covenants or agreements under  this Agreement; or (iii) matters for which Haisco has an obligation to indemnify any Aquestive  Indemnitee pursuant to Section 11.1.  11.3 Procedure for Indemnification.    11.3.1 Notice.  In the case of a Third Party Claim or demand other than patent  claims (which are subject to the procedures set forth in Section 14.4 or Section 14.5) made by  any Person who is not a Party of this Agreement (or an Affiliate thereof) as to which a Party (the  “Indemnitor”) may be obligated to provide indemnification pursuant to this Agreement, such  Party seeking indemnification hereunder (“Indemnitee”) will notify the Indemnitor in writing of  the Third Party Claim (and specifying in reasonable detail the factual basis for the Third Party  Claim and to the extent known, the amount of the Third Party Claim) reasonably promptly after  becoming aware of such Third Party Claim; provided, however, that failure to give such  notification will not affect the indemnification provided hereunder except to the extent the  Indemnitor shall have been actually materially prejudiced as a result of such failure.  11.3.2 Defense of Claim.  If a Third Party Claim is made against an Indemnitee,  then except as set forth in Section 14.4 or Section 14.5, the Indemnitor will be entitled, within  thirty (30) days after receipt of written notice from the Indemnitee of the commencement or  assertion of any such Third Party Claim, to assume the defense thereof by providing written  notice to Indemnitee of its intention to assume the defense of such Third Party Claims within  such thirty (30) day period (at the expense of the Indemnitor) with counsel selected by the  Indemnitor and reasonably satisfactory to the Indemnitee for so long as the Indemnitor is  conducting a good faith and diligent defense.  Should the Indemnitor so elect to assume the  defense of such Third Party Claim, the Indemnitor will not be liable to the Indemnitee for any  legal or other expenses subsequently incurred by the Indemnitee in connection with the defense  thereof; provided, however, that if under applicable standards of professional conduct a conflict  of interest exists between the Indemnitor and the Indemnitee in respect of such claim, such  Indemnitee shall have the right to employ separate counsel to represent such Indemnitee with  respect to the matters as to which a conflict of  interest exists and in that event the reasonable  fees and expenses of such separate counsel shall be paid by such Indemnitor; provided, further,  that the Indemnitor shall only be responsible for the reasonable fees and expenses of one separate  counsel for such Indemnitee.  If the Indemnitor assumes the defense of any Third Party Claim,  the Indemnitee shall have the right to participate in the defense thereof and to employ counsel, at  its own expense, separate from the counsel employed by the Indemnitor.  If the Indemnitor  assumes the defense of any Third Party Claim, the Indemnitor will promptly supply to the  Indemnitee copies of all material correspondence and documents relating to or in connection  with such Third Party Claim and keep the Indemnitee reasonably informed of developments  relating to or in connection with such Third Party Claim, as may be reasonably requested by the  Indemnitee (including, without limitation, providing to the Indemnitee on reasonable request  updates and summaries as to the status thereof).  If the Indemnitor chooses to defend a Third  Party Claim, all Indemnitees shall reasonably cooperate with the Indemnitor in the defense  thereof (such cooperation to be at the expense, including reasonable legal fees and expenses, of  the Indemnitor).  If the Indemnitor does not elect to assume control by written acknowledgement  





 






BUSINESS.29027546.1         35    of the defense of any Third Party Claim within the thirty (30) day period set forth above, or if  such good faith and diligent defense is not being or ceases to be conducted by the Indemnitor, the  Indemnitee shall have the right, at the expense of the Indemnitor, after five (5) Business Days’  written notice to the Indemnitor of its intent to do so, to undertake the defense of the Third Party  Claim for the account of the Indemnitor (with counsel selected by the Indemnitee), and to  compromise or settle such Third Party Claim, exercising reasonable business judgment.  11.3.3 Settlement of Claims.  In no event may the Indemnitor compromise or  settle any Third Party Claim in a manner which admits fault or negligence on the part of the  Indemnitee without the prior written consent of the Indemnitee.  Without limiting the foregoing,  if the Indemnitor acknowledges in writing its obligation to indemnify the Indemnitee for a Third  Party Claim, the Indemnitee will agree to any settlement, compromise or discharge of such Third  Party Claim that the Indemnitor may recommend that by its terms obligates the Indemnitor to  pay the full amount of Losses (whether through settlement or otherwise) in connection with such  Third Party Claim and unconditionally and irrevocably releases the Indemnitee completely from  all Losses in connection with such Third Party Claim; provided, however, that, without the  Indemnitee’s prior written consent, the Indemnitor shall not consent to any settlement,  compromise or discharge (including, without limitation, the consent to entry of any judgment),  that provides for injunctive or other nonmonetary relief affecting the Indemnitee.  11.3.4 Assumption of Defense.  Notwithstanding anything to the contrary  contained herein, an Indemnitee shall be entitled to assume the defense of any Third Party Claim  with respect to the Indemnitee upon written notice to the Indemnitor pursuant to this  Section 11.3.4, in which case, the Indemnitor shall be relieved of liability under Section 11.1 or  11.2, as applicable, solely for such Third Party Claim and related Losses.  11.4 Insurance.  During the Term and for a period of five (5) years after the  termination or expiration of this Agreement, each Party will maintain, at its cost, a program of  insurance or self-insurance against liability and other risks associated with its activities and  obligations under this Agreement, in such amounts, subject to such deductibles and on such  terms as are reasonable and customary for the activities to be conducted by it under this  Agreement, in accordance with the Applicable Law.  Each Party acknowledges and agrees that  its liabilities under this Agreement will not be limited by the amount of such Party’s insurance.   Each Party shall provide notice to the other Party at least thirty (30) days prior to the cancellation  of any such insurance policy or any substantial modification of the terms of such coverage under  any such insurance policy.  Each Party shall provide written proof of the existence of such  insurance to the other Party upon written request.  11.5 Limitation of Liability.    11.5.1 EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, IN  NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER OR ANY OF ITS  AFFILIATES FOR ANY CONSEQUENTIAL, INCIDENTAL, INDIRECT, SPECIAL,  PUNITIVE OR EXEMPLARY DAMAGES (INCLUDING, WITHOUT LIMITATION, LOST  PROFITS, BUSINESS OR GOODWILL) SUFFERED OR INCURRED BY SUCH OTHER  PARTY OR ITS AFFILIATES IN CONNECTION WITH THIS AGREEMENT, THE  TRANSACTIONS CONTEMPLATED HEREIN OR A BREACH OR ALLEGED BREACH  





 






BUSINESS.29027546.1         36    OF THIS AGREEMENT.  THE FOREGOING SENTENCE SHALL NOT (A) APPLY IN  CASES OF A PARTY’S FRAUD, GROSS NEGLIGENCE, WILLFUL MISCONDUCT, OR  INTENTIONAL MISCONDUCT, (B) NOT LIMIT THE OBLIGATIONS OF EITHER PARTY  TO INDEMNIFY THE OTHER PARTY FROM AND AGAINST THIRD PARTY CLAIMS  UNDER SECTIONS 11.1 OR 11.2, OR (C) LIMIT THE DAMAGES AVAILABLE TO A  PARTY FOR A BREACH UNDER SECTION 2.2, SECTION 2.3, SECTION 2.5, OR  SECTION 10.  11.5.2 FOR THE AVOIDANCE OF DOUBT, NOTHING IN THIS  AGREEMENT SHALL LIMIT ANY REMEDY EITHER PARTY MAY HAVE AGAINST  THE OTHER PARTY FOR CLAIMS BASED ON FRAUD, WILLFUL MISCONDUCT OR  INTENTIONAL MISCONDUCT, AND NOTHING HEREIN SHALL LIMIT THE LIABILITY  OF ONE PARTY TO THE OTHER PARTY FOR FRAUD, WILLFUL MISCONDUCT OR  INTENTIONAL MISCONDUCT IN THE EVENT SUCH PARTY IS FINALLY  DETERMINED BY AN ARBITRATOR OR COURT OF COMPETENT JURISDICTION TO  HAVE COMMITTED FRAUD, WILLFUL MISCONDUCT OR INTENTIONAL  MISCONDUCT AGAINST THE OTHER PARTY.  12. TERM AND TERMINATION  12.1 Term.  The initial term shall commence as of the Effective Date and shall and run  until the [***] of the First Commercial Sale (together with any renewal term, the “Term”).  Haisco shall have the option to renew this Agreement upon written notice delivered to Aquestive  no later than one hundred eighty (180) days prior to the expiration of the then current term.   12.2 Termination.  In addition to any other provision of this Agreement expressly  providing for termination of this Agreement:  12.2.1 This Agreement may be terminated by either Party: immediately upon  written notice: (a) upon the occurrence of a Bankruptcy Event with respect to the other Party; or  (b) in addition to the termination rights set forth below in this Section 12.2, if the other Party  commits any material misrepresentation or breach of any of its covenants, obligations,  representations or warranties under this Agreement and, in the case of a breach which is capable  of remedy, such Party fails to remedy the same within ninety (90) days after receipt of a written  notice describing the breach and requiring it to be so remedied.  12.2.2 This Agreement may be terminated (i) by Aquestive upon thirty (30) days’  prior written notice if Haisco has violated Section 2.3 or the first sentence of Section7.1; or (ii)  by Haisco upon thirty (30) days’ prior written notice if Aquestive has violated Section 2.2 or the  first sentence of Section 7.1.  12.2.3 This Agreement may be terminated upon thirty (30) days’ prior written  notice by Aquestive if in or after [***] after Marketing Authorization is granted, Haisco is  permitted to make a Minimum Payment Commitment in [***].    12.2.4 This Agreement may be terminated by Aquestive upon written notice if  Haisco does not use Commercially Reasonable Efforts to execute its Development or  





 






BUSINESS.29027546.1         37    Commercialization responsibilities for the Product and fails to remedy such deficiency within  sixty (60) days after receipt of a written notice from Aquestive describing the deficiency.  12.2.5 This Agreement may be terminated by Aquestive upon written notice, in  the event: (a) Haisco and/or any of its activities are completely nationalized, expropriated, or  taken over by a Governmental Authority; or (b) any Governmental Authority requires the Supply  of the Product be conducted in the Territory.    12.2.6 This Agreement may be terminated by Haisco upon written notice if  Aquestive does not use Commercially Reasonable Efforts to execute its Development or Supply  responsibilities for the Product and Aquestive fails to remedy the same within sixty (60) days  after receipt of a written notice from Haisco describing failure and requiring it to be so remedied.  12.2.7 This Agreement may be terminated by Haisco immediately upon written  notice to Aquestive if, regardless whether Commercially Reasonable Efforts are used and  regardless whether Aquestive has issued instruction(s) or request(s) to the relevant Third Parties,  within the time period specified in Section 4 (subject to Section 4.2.4 and Section 4.2.5,  inclusive), Aquestive fails to transfer or cause the Third Parties to (x) transfer to Haisco the  Regulatory Documentation, or (y) transfer to Haisco (or in the alternative, directly filed with the  Regulatory Authorities) the DMFs or equivalent documentation required by the Regulatory  Authority to support the application for Regulatory Approval for the Product in the Territory,  subject to the extension of time to comply with such requests for documentation under Section  4.2.7, and such failure has not been cured within forty-five (45) days following receipt of written  notice from Haisco requesting cure of the failure.  12.2.8 In the event that (i) Marketing Authorization for the Product is withdrawn  in any country or region due to safety reasons, or (ii) the Product is recalled in any country or  region due to safety reasons and such recall has materially and adversely affected the reputation  of such Product, the Parties shall immediately initiate a good faith discussion with respect to  terminating this Agreement by mutual consent. If the Parties fail to reach a mutual agreement  within sixty (60) days following the withdrawal or recall, this Agreement may be terminated by  Haisco immediately upon delivery of written notice to Aquestive.  12.2.9 This Agreement may be terminated by Haisco immediately upon delivery  of written notice to Aquestive in the event that [***] Generic Products are simultaneously sold in  the Territory.  12.2.10 This Agreement may be terminated by Aquestive upon written  notice to Haisco in the event that Haisco fails to pay any milestone payment as and when due  pursuant to Section 8.1, or any royalty or Minimum Payment Commitment and fails to remedy  same within sixty (60) days of receipt of a written notice describing the failure and requiring it to  be so remedied.  12.2.11 This Agreement may be terminated by either Party upon ninety  (90) days written notice to the other Party if Marketing Authorization in the Field in the Territory  has not been granted on the date that is [***] after the Effective Date.  





 






BUSINESS.29027546.1         38    12.2.12 This Agreement may be terminated by Haisco for any reason or no  reason giving six (6) months advance written notice to Aquestive. Haisco’s right to terminate the  Agreement under this Section 12.2.12 shall be subject to Haisco’s payment of the Event 1  milestone payment set forth in Section 8.1, to the extent not already paid to Aquestive.  12.2.13 This Agreement may be terminated by Aquestive upon written  notice to Haisco if Haisco, any Affiliate or Third Party acting on its behalf, challenges the  validity of any licensed Aquestive IP or Joint New IP.  12.3 Effects of Termination.    12.3.1 Effect of Termination Generally.  On the expiration or earlier termination  of this Agreement for any reason, except as otherwise expressly provided herein, all rights and  obligations of each Party hereunder shall cease.  12.3.2 Disposition and Transfer of Inventory upon Termination; Royalties Due  Thereon Not Affected By Termination.  On the expiration or earlier termination of this  Agreement:  (a) all unpaid royalties for Product sold as of the effective date of termination shall  remain due and payable as scheduled; (b) at Aquestive’s option (or at Haisco’s option terminated  pursuant to Section 12.2.1(b), or Sections 12.2.6 through 12.2.9, inclusive), Aquestive shall  complete all work-in-process and Haisco shall purchase at the Product Transfer Price under this  Agreement, all remaining inventory of the Product and, at cost, all Raw Materials relating thereto  in Aquestive’s possession or control (but not to exceed a supply of Product corresponding to the  first three (3) months of the most recent supply forecast delivered by Haisco in accordance with  Section 7.3) and Aquestive shall use all Commercially Reasonable Efforts to mitigate the cost  thereof to Haisco and to consult with Haisco in connection with such attempts to mitigate;  (c) Haisco shall have the right to sell out such remaining inventory of Product for a period of up  to six (6) months; and (d) Haisco shall pay to Aquestive a royalty, and subject to all of the  provisions of Section 8.3, Section 8.5 through Section 8.9, and Section 8.12, on each sale of  remaining inventory of Product by Haisco and/or its Affiliates when and as such Product is sold.  12.3.3 Upon the expiration or earlier termination of this Agreement for any  reason other than other than for a termination by Haisco pursuant to Section 12.2.1(b), or  Sections 12.2.6 through 12.2.9, inclusive, Aquestive shall have the right, to be exercised at  Aquestive’s sole option, to receive an assignment in whole or in part, directly or to a designated  sublicensee, and without cost, of all of Haisco’s right, title and interest, if any, at the time of  expiration or termination, in and to: (a) each Regulatory Approval; and (b) all data generated in  support of such Regulatory Approvals, including, without limitation, from all associated clinical  studies.  In the event of a termination by Haisco pursuant to Section 12.2.1(b), or Sections 12.2.6  through 12.2.9, inclusive, such assignment shall be made for consideration equaling Haisco’s  out-of-pocket costs incurred (excluding payments made by Haisco to Aquestive in respect of  same under this Agreement).  In connection with any assignment contemplated by this  Section 12.3.3, Haisco shall cooperate with Aquestive and execute and deliver to Aquestive any  and all documents reasonably necessary to perfect its or Aquestive’s designee’s rights to the  foregoing and, to the extent applicable, Haisco shall ensure that all such Regulatory Approvals to  be assigned remain in good standing until such assignment to Haisco is complete.  





 






BUSINESS.29027546.1         39    12.3.4 Accrued Rights.  Termination, relinquishment, or expiration of this  Agreement for any reason shall be without prejudice to any right which shall have accrued to the  benefit of either Party prior to such termination, relinquishment or expiration including damages  arising from any breach under this Agreement.  Termination, relinquishment, or expiration of  this Agreement shall not relieve either Party from any obligation which is expressly or by  implication intended to survive such termination, relinquishment or expiration of this Agreement  and shall not affect or prejudice any provision of this Agreement which is expressly or by  implication provided to come into effect on, or continue in effect after, such termination,  relinquishment, or expiration. Remedies for breaches under this Agreement shall also survive  any termination, relinquishment, or expiration of this Agreement.  12.3.5 Survival.  The following Sections of this Agreement, as well as any other  provisions in this Agreement which specifically state they will survive termination or expiration  of this Agreement, shall survive expiration or termination of this Agreement for any reason:   Section 1, Section 2.1 (provided that the license granted in Section 2.1 shall be non-exclusive  and all such sections shall survive for the sole purpose of selling out remaining inventory of  Product as set forth in Section 12.3.2(c)), Sections 7.4 (survive for the sole purpose of Product  ordered by Haisco prior to the termination of this Agreement), 7.5, 7.6 and 7.7, Sections 7.9,  Section 8.1 (solely with respect to unpaid milestone payments which have accrued as of such  termination), Section 8.3 (solely with respect to unpaid royalties which have accrued as of such  termination or otherwise as set forth in Section 12.3.2(c)), Section 8.5 through Section 8.9  (solely with respect to unpaid royalties which have accrued as of such termination or otherwise  as set forth in Section 12.3.2(c)), Section 8.12 (solely with respect to royalty payments due after  such termination or expiration for sales prior to such termination or expiration), Sections 9.4, 10,  11, 12.3, 13.5, 14.1.1 through 14.1.5, 14.7, 14.8, and 15.  12.3.6 Return of Confidential Information.  Within thirty (30) days of any  expiration or termination of this Agreement: (a) Haisco shall cease to use and shall deliver to  Aquestive, upon written request, all Confidential Information of Aquestive, except for any  documents or records that Haisco is required to retain by Applicable Law or that are reasonable  necessary for Haisco to exercise its rights under Section 12.3.2; and (b) Aquestive shall cease to  use and shall deliver to Haisco, upon written request, all Confidential Information of Haisco  except for any documents or records that Aquestive is required to retain by Applicable Law or  that are reasonable necessary for Aquestive to exercise its rights under Section 12.3.2.  12.3.7 Rights in Bankruptcy.  All rights and licenses granted under or pursuant to  this Agreement by Aquestive or Haisco are, and shall otherwise be deemed to be, for purposes of  Section 365(n) of the U.S. Bankruptcy Code or any analogous provisions in any other country or  jurisdiction, licenses of right to “intellectual property” as defined under Section 101 of the U.S.  Bankruptcy Code.  The Parties agree that the Parties, as licensees of such rights under this  Agreement, shall retain and may fully exercise all of their rights and elections under the U.S.  Bankruptcy Code or any analogous provisions in any other country or jurisdiction.  The Parties  further agree that, in the event of the commencement of a bankruptcy proceeding by or against  either Party under the U.S. Bankruptcy Code or any analogous provisions in any other country or  jurisdiction, the Party hereto that is not a Party to such proceeding shall be entitled to a complete  duplicate of (or complete access to, as appropriate) any such intellectual property and all  embodiments of such intellectual property, which, if not already in the non-subject Party’s  





 






BUSINESS.29027546.1         40    possession, shall be promptly delivered to it (i) upon any such commencement of a bankruptcy  proceeding upon the non-subject Party’s written request therefor, unless the Party subject to such  proceeding elects to continue to perform all of its obligations under this Agreement, or (ii) if not  delivered under clause (i) above, following the rejection of this Agreement by or on behalf of the  Party subject to such proceeding upon written request therefor by the non-subject Party.  13. REGULATORY MATTERS  13.1 Regulatory Approvals in the Territory.  Haisco shall use Commercially  Reasonable Efforts, in good faith, at Haisco’s sole cost and expense, to conduct such research  and Development activities, including clinical trials and dossier gap assessments, necessary or  desirable to obtain, as promptly as reasonably Regulatory Approval for the Product in the  Territory and shall take all such reasonable actions as shall be necessary or appropriate to  prepare and file all documentation with the applicable Regulatory Authorities and to furnish such  information to the Regulatory Authorities in connection therewith.    13.2 Regulatory Strategies in the Territory.  Subject to the provisions of this Section  13, Haisco shall have sole control, and have authority and responsibility for, the regulatory  strategies relating to the Product in the Territory prior to approval, including, without limitation:  (a) the preparation of all documents filed with Regulatory Authorities and the filing of all  submissions relating to Regulatory Approval for the Product; (b) all regulatory actions,  communications and meetings with any Regulatory Authority with respect to the Product; and  (c) applying for and obtaining Regulatory Approvals for the Product in the Territory.  Haisco  shall be responsible for all costs associated with filings with Regulatory Authorities and  additional Development work necessary for Regulatory Approvals in the Territory.  Haisco shall  provide to Aquestive in a timely fashion drafts and final copies of material filings, documents, or  correspondence (as the scope of which shall be agreed by the Parties in writing) to be filed with  any Regulatory Authority in the Territory that pertains to the Product in Chinese with a summary  in English.  At Aquestive’s written request and at the sole cost and expense of Aquestive, Haisco  will provide Aquestive with a copy of English translation of such drafts and final copies  described in this Section 13.2. Haisco shall consider in good faith the comments of Aquestive  with respect to any such material filings, documents, or correspondence.    13.3 Communications and Meetings with Governmental Authorities.    13.3.1 Communications with Regulatory Authorities.  Subject to the provisions  of this Section 13, Haisco shall be solely responsible for interfacing, corresponding, and meeting  with all Regulatory Authorities for Regulatory Approvals in the Territory.  At all times during  the Term, Haisco shall be responsible, at its expense, for reporting any and all Adverse Events to  the applicable Regulatory Authorities.  Immediately upon receipt of any contact with or  communication from any Regulatory Authority relating to the Product or becoming aware of any  Adverse Event in the Territory, each Party shall forward a copy or description of the same to the  other Party and shall use Commercially Reasonable Efforts to respond to all reasonable inquiries  from the other Party relating thereto.    13.3.2 Notification by Haisco of any Regulatory Actions.  Each Party shall as  soon as reasonably possible after receipt of any inspections, proposed regulatory actions,  





 






BUSINESS.29027546.1         41    investigations, or requests by any Regulatory Authority with respect to the Supply of Product in  the Territory, as well as any corrective or other actions with Regulatory Authorities initiated by a  Party with respect thereto, notify the other Party in reasonable detail with respect thereto and will  provide the other Party with copies of all related documentation.   13.3.3 Approval of Labeling and Promotional Materials.  Subject to the  provisions of this Agreement, Haisco shall timely file with the applicable Regulatory Authorities  and obtain any necessary Regulatory Authority approvals of any promotional materials, label,  labeling, package inserts or outserts, monographs and packaging, in each case, to the extent  required by the Applicable Law of the People’s Republic of China.  13.4 Regulatory Notices.   13.4.1 Notice.  Each Party or its respective representative shall provide the other  Party with notice, in a sufficiently timely basis but in any event within one (1) Business Day of  receipt, to enable the other Party to comply in all material respects with Applicable Law, of  notification or other information which it receives (directly or indirectly) from, any Regulatory  Authority (and providing, as soon as reasonably possible, copies of any associated written  requests) that: (a) raises any material concerns regarding the safety or efficacy of the Product; (b)  indicates or suggests a Third Party Claim arising in connection with the Product; or (c) is  reasonably likely to lead to a Recall, market withdrawal or field correction of, field alert report or  comparable report with respect to the Product.  Information that shall be disclosed pursuant to  this Section 13.4 shall include, but not be limited to:  13.4.1.1 inspections by a Regulatory Authority of manufacturing,  distribution or other related facilities concerning the Product;  13.4.1.2 inquiries by a Regulatory Authority concerning clinical  investigation activities (including, without limitation, inquiries regarding investigators, clinical  monitoring organizations and other related Parties) with respect to the Product;  13.4.1.3 any communication from a Regulatory Authority involving the  manufacture, sale, promotion or distribution of the Product, or any other Regulatory Authority  reviews or inquiries relating to any event set forth in Section 13.4.1(c);  13.4.1.4 any receipt of a warning letter from a Regulatory Authority  relating to the Product;  13.4.1.5 any initiation of any Regulatory Authority investigation,  detention, seizure, or injunction concerning the Product; and  13.4.1.6 any other regulatory action (e.g., proposed labeling or other  registrational dossier changes and Recalls) which would affect the Product.  13.5 Recalls or Other Corrective Action.    13.5.1 Notice of Action.  Aquestive shall maintain traceability records in  accordance with applicable governmental rules, necessary to permit a recall, field correction or  





 






BUSINESS.29027546.1         42    other notification to the field, of any Product.  Aquestive agrees to notify Haisco promptly if  Aquestive discovers any issue that it reasonably believes could lead to a recall of a Product.   Haisco shall have the exclusive right to institute a recall, market withdrawal, field correction or  field report of a Product and shall be responsible for managing the recall and communications  with customers and Regulatory Authorities.  As soon as reasonably possible, Haisco shall notify  Aquestive of any actions to be taken by Haisco or its Affiliates, subcontractors or agents with  respect to any recall or market withdrawal or field correction, field alert report or comparable  report or any matter which is suspected or likely to be the subject of a complaint which may  require a recall, market correction or similar action relating to the Product in the Territory (a  “Recall”) prior to any such action so as to permit Aquestive a reasonable opportunity to consult  with Haisco with respect thereto.  Haisco agrees to consider Aquestive’s consultation in good  faith; provided, however, that, nothing in this Section 13.5 is intended to limit Haisco’s ability to  recall, withdraw or take any other corrective action relating to the Product.  At Haisco’s  reasonable written request (except as set forth in this Section 13.5), Aquestive shall provide  reasonable assistance to Haisco in conducting such Recall. The cost of any Recall, including, the  costs of notifying customers and the costs associated with the shipment of the Product from  customers and all reasonable credits extended to customers as a result thereof, and the costs of  replacing the Product (“Recall Expenses”), occasioned or required as part of a general Recall of  the products of a Party, shall be borne as provided in the following sentences: Any Recall  Expenses caused by Aquestive or the failure of Aquestive to Supply the Product conforming to  the Specifications or applicable Regulatory Approvals or other breach of this Agreement by  Aquestive, as determined by a Regulatory Authority or as mutually agreed, shall be borne by  Aquestive.  Any Recall Expenses caused by Haisco or the failure of Haisco to Commercialize the  Product conforming to the applicable Regulatory Approvals or other breach of this Agreement  by Haisco, as determined by a Regulatory Authority or as mutually agreed, shall be borne by  Haisco.  In the event that there is no determination by a Regulatory Authority or the parties  dispute which Party that is the cause of a Recall, either Party may send a notice of objection  regarding such Recall (the “Recall Objection Notice”).  The Parties agree to attempt to resolve  such dispute within thirty (30) days after receipt of such notice.  If Haisco and Aquestive fail  within thirty (30) days after delivery of the Recall Objection Notice to agree as to the Party that  is the cause of such Recall, the issue, and as applicable, any representative samples of the  Product, shall be submitted to a mutually and reasonably acceptable independent Third Party  laboratory of national reputation, or consultant (if not a laboratory analysis issue) for analysis or  review.  The results of such evaluation shall be binding upon the Parties.  The Party that is  determined to have been the cause of such Recall shall pay one hundred percent (100%) of the  Recall Expenses including the cost of any such evaluation, or, if it is determined that both Parties  are partially at fault, then the Parties shall share in the Recall Expenses in proportion to each  Party’s fault. If the fees of the independent laboratory or consultant are due in advance, Haisco  and Aquestive shall each pay fifty percent (50%) of such fees; provided, however, that promptly  after the independent Third Party laboratory or consultant completes its evaluation, the Party that  was the cause of the Recall shall reimburse the other Party for its fifty percent (50%) share of  such fees (or if found proportionately at fault, for such Party’s proportion of such fees).  If the  results of such evaluation are inconclusive, Haisco and Aquestive shall each pay fifty percent  (50%) of the direct, out-of-pocket Recall Expenses relating to such Recall including the cost of  any such evaluation and destruction of any recalled Product.  





 






BUSINESS.29027546.1         43    13.5.2 Recall Information Received.  Each Party shall, as soon as reasonably  practicable, notify the other Party of any Recall, market withdrawal or field correction of, field  alert report or comparable report or complaint with respect to the Product and supply all  information received by it relating thereto in sufficient detail to allow the Parties to comply with  Applicable Law.  14. INTELLECTUAL PROPERTY  14.1 Ownership of IP.  14.1.1 Existing Intellectual Property.  Each Party will own all right, title and  interest in and to such Intellectual Property Controlled by such Party or its Affiliates or created  by such Party or its Affiliates prior to the Effective Date or independently of this Agreement.  14.1.2 Improvements.  As between Aquestive and its Affiliates, on the one hand,  and Haisco and its Affiliates and sublicensees, on the other hand, any Intellectual Property  conceived, reduced to practice or otherwise developed after the Effective Date in the  performance of this Agreement (“New IP”) that is conceived, reduced to practice or otherwise  developed solely by Aquestive or its Affiliates or their respective employees or Third Party  contractors during the Term shall be owned by Aquestive (“Aquestive New IP”);.  Any New IP  other than Aquestive IP, Aquestive New IP or Joint New IP (as defined below) that is conceived,  reduced to practice or otherwise developed solely by Haisco or its Affiliates or their respective  employees or Third Party contractors during the Term shall be owned by Haisco (“Haisco New  IP”).  14.1.3 Joint Intellectual Property.  The Parties will jointly own all New IP,  excluding any Aquestive New IP, (i) made jointly by at least one representative of each Party or  (ii) conceived, reduced to practice or otherwise developed by Haisco or its Affiliates or their  respective employees or Third Party contractors or jointly with Aquestive or its Affiliates or their  respective employees or Third Party contractors during the Term that has applicability to the  Product or that otherwise relies upon, incorporates, improves upon or otherwise requires the  Aquestive IP or Aquestive New IP (collectively, “Joint New IP”).  All patents claiming  patentable Joint New IP will be referred to herein as “Joint Patents.”  Except to the extent either  Party is restricted by licenses granted to the other Party under this Agreement, either Party will  be entitled to practice, grant licenses to, assign and exploit the Joint New IP and Joint Patents  without the duty of seeking consent from the other Party.  14.1.4 For the avoidance of doubt, Aquestive New IP and the rights and interests  of Aquestive under the Joint New IP shall be included in Aquestive IP and licensed to Haisco  pursuant to this Agreement.  14.1.5 Haisco hereby grants to Aquestive (i) a perpetual, non-revocable,  exclusive (even as to Haisco, its Affiliates and sublicensees), royalty-free license, with the right  to grant sublicenses, under Joint New IP to Develop, Manufacture, and Commercialize Products  outside the Territory or inside the Territory outside the Field, and (ii) a non-exclusive license and  right of reference, with the right to grant sublicenses and further right of reference, to use the  Regulatory Documentation Controlled by Haisco to Develop, Manufacture, or Commercialize  





 






BUSINESS.29027546.1         44    the Licensed Products outside the Territory or inside the Territory outside the Field. From and  after the expiration or earlier termination of this Agreement, the foregoing license shall include  the Field.  14.1.6 Haisco hereby grants to Aquestive during the Term (i) a non-revocable,  exclusive (even as to Haisco, its Affiliates and sublicensees), royalty-free license, with the right  to grant sublicenses, Haisco New IP to Develop, Manufacture, and Commercialize Products in  the Territory in the Field.  14.2 Patent Prosecution and Maintenance.    14.2.1 Subject to Section 14.2.1, Aquestive shall be responsible for the  preparation, filing, prosecution and maintenance of the Aquestive Patents having claims which  cover the Product (herein after referred to as the “Patent Actions”).  The cost of such  preparation, filing, prosecution and maintenance of the Aquestive Patents, shall be borne by  Aquestive. Haisco shall be responsible for the preparation, filing, prosecution and maintenance  of all patents and patent applications included in Haisco New IP (“Haisco Patents”).  The cost of  such preparation, filing, prosecution and maintenance of the Haisco Patents, shall be borne by  Haisco.  14.2.2 In the event that Aquestive determines to abandon or cease prosecution of  any Aquestive Patent (an “Abandoned Patent”), Aquestive will provide Haisco written notice  thereof at least thirty (30) days before the applicable deadline (“Notice to Abandon”) and provide  to Haisco information it reasonably requests relating to such Aquestive Patent. In such case,  upon Haisco’s written election provided no later than thirty (30) days after such notice from  Aquestive (“Step-In Notice”), Haisco shall have the right to assume the Patent Actions with  respect to such Aquestive Patent at Haisco’s expense (“Step In Rights”).  If Haisco does not  provide such Step-In Notice within thirty (30) days after receipt of a Notice to Abandon,  Aquestive may, in its sole discretion, continue the Patent Actions with respect to such Aquestive  Patent or discontinue the Patent Actions with respect to such Aquestive Patent.  14.2.3 If either Party decides to file a Joint Patent, such Party will notify the other  Party of such determination and within fourteen (14) days of such notification, the Parties will  discuss in good faith the joint preparation, filing, prosecution and maintenance of all patents and  patent applications within the Joint Patents.   14.2.4 The Parties shall cooperate at the requesting Party’s expense, with respect  to the preparation, filing, prosecution and maintenance of any patents claiming New IP and in the  obtaining and maintenance of any extensions, supplementary protection certificates and the like  with respect to any patents claiming New IP.  Such cooperation includes promptly informing the  other Party of any matters coming to such Party’s attention that may affect the any associated  Patent Actions.  14.3  Patent Term Extensions in the Territory. The patent counsel of each Party will  discuss and recommend for which, if any, of the Aquestive Patents and Joint Patents in the  Territory the Parties should seek any term extensions, supplementary protection certificates, and  equivalents thereof offering patent protection beyond the initial term with respect to any issued  





 






BUSINESS.29027546.1         45    patents (“Patent Term Extensions”) licensed to Haisco hereunder in the Territory.  To the extent  the Parties agree to apply for any such Patent Term Extensions in the Territory; Aquestive will  cooperate fully with Haisco, at Haisco’s expense, in making such filings or taking any related  actions, for example and without limitation, making available all required regulatory data and  information and executing any required authorizations to apply for such Patent Term Extensions.  14.4 IP Enforcement Against Third Parties.    14.4.1 Each Party shall promptly notify the other Party in writing of any alleged  or threatened infringement of any Joint Patent (a “Competitive Infringement”) and any Aquestive  Patent resulting from the making, using, selling, offering for sale, or importing of any product in  or for the Territory, of which they become aware.  14.4.2 In each such instance of Competitive Infringement Aquestive shall have  the right, but not the obligation, in its own name and under its own direction and control, to  institute litigation against such alleged or threatened Competitive Infringement at Aquestive’s  cost and expense. If Aquestive does not, within ninety (90) days after its receipt or delivery of  notice under Section 14.4.1, commence a suit to enforce the applicable patent, take other action  to terminate such Competitive Infringement or initiate a defense against such Competitive  Infringement, then: (i) Haisco will have the right, but not the obligation, to commence such a suit  or take such an action or defend against such Competitive Infringement in the Territory at  Haisco’s cost and expense, to be represented in any such suit by counsel of its own choice and  (ii) if Haisco exercises its right under the foregoing clause (i), Aquestive will take all reasonable  and appropriate actions in order to permit Haisco to commence a suit or take the actions with  respect to the Competitive Infringement. Neither Party will enter into any settlement, consent  judgment or other voluntary final disposition of any action under this Section 14.4 without the  other Party’s prior written consent, which consent will not be unreasonably withheld or delayed,  unless the settlement includes any express or implied admission of liability or wrongdoing on  either Party’s part, in which case the right to grant or deny consent is absolute and at its sole  discretion.  14.4.3 Each Party shall reasonably assist the Party enforcing any such rights  under this Section 14.4 in any such action or proceeding if so requested by the enforcing Party,  and will be named in or join such action or proceeding if requested by the enforcing Party, and  will reasonably cooperate with the enforcing Party in such participation (including providing  copies of all prior claim construction submissions and supporting documents subject to  confidentiality provisions as required); provided, that if Aquestive is the enforcing Party, the  reasonable, out-of-pocket costs and expenses of Haisco in connection therewith, including any  Aquestive-approved investigation and analysis thereof, is to be reimbursed to Haisco on an as- incurred basis.  The enforcing Party shall keep such other Party and/or its designated legal  counsel reasonably informed as to the progress in connection with the foregoing Competitive  Infringement, and will reasonably consider the other Party’s comments on any such efforts.  14.4.4 If the enforcing Party recovers monetary damages in such claim, suit or  action, such recovery will be allocated first to the reimbursement of any expenses incurred by the  Parties in such litigation (including, for this purpose, a reasonable allocation of expenses of  internal counsel), and any remaining amounts will be allocated as follows: (a) if Haisco is the  





 






BUSINESS.29027546.1         46    enforcing or defending Party, the remaining amounts will be retained by Haisco, however,  Haisco will calculate Net Sales under this Agreement based on the remaining amounts attributed  to lost sales as if Haisco had made the infringing sales directly, and will pay to Aquestive the  License Royalty owed by Haisco to Aquestive pursuant to Section 8.5; and (b) if Aquestive is the  enforcing or defending Party, the remaining amounts will be retained by Aquestive.  14.5 Action by Third Party. In the event that any Third Party initiates a declaratory  judgment action alleging the noninfringement, invalidity or unenforceability of the Aquestive  Patents, or if any Third Party brings an infringement action against Haisco or its Affiliates or  sublicensees because of the exercise of the rights granted to Haisco under this Agreement with  respect to the Aquestive Patents, and Aquestive or Haisco has not commenced any action to  enforce Aquestive Patents against such Third Party under the terms of Section 14.4 above, each  Party will give prompt notice to the other Party of any such action. Aquestive shall have the right  and the obligation, to take any necessary actions (including the filing of pleadings required by  the Applicable Law or any local rules of court) and defend against such action under its own  control and at its own expense. If Aquestive fails to defend such action, Haisco will have the  right, but not the obligation to defend against such action under its own control and at  Aquestive’s cost and expense. Neither Party will enter into any settlement, consent judgment or  other voluntary final disposition of any action under this Section 14.5 without the other Party’s  prior written consent, which consent will not be unreasonably withheld or delayed, unless the  settlement includes any express or implied admission of liability or wrongdoing on either Party’s  part, in which case the right to grant or deny consent is absolute and at its sole discretion.  Notwithstanding the above, if Aquestive or Haisco has commenced any action to enforce  Aquestive Patents against such Third Party under the terms of Section 14.4 above, then the terms  of Section 14.4 will supersede the terms of this Section 14.5.  14.6 As between the Parties, Haisco will have the sole right, but not the obligation, to  bring an appropriate suit or other action against any person or entity allegedly infringing any  Haisco New IP (including the Haisco New Patents) and to defend against any declaratory  judgment action against any Haisco New IP (including the Haisco New Patents).  14.7 Ownership of Haisco Housemarks; Termination of Right to Use.    14.7.1 Haisco shall own all right, title, and interest in the Haisco Housemarks in  all forms of use or display in which they may appear, and any goodwill associated therewith.   Notwithstanding any provision of this Agreement, Aquestive agrees that it shall not, by virtue of  this Agreement, acquire any right, title, and interest in or to the Haisco Housemarks or any  goodwill associated therewith.  14.7.2 Upon and following the termination of this Agreement, except in  connection with any Supply of Product to Haisco after termination or expiration of this  Agreement, Aquestive shall not use the Haisco Housemarks or any other name or mark of  Haisco.  14.8 Ownership of Aquestive Housemarks; Termination of Right to Use.    





 






BUSINESS.29027546.1         47    14.8.1 Aquestive shall own all right, title, and interest in the Aquestive  Housemarks in all forms of use or display in which they may appear, and any goodwill  associated therewith.  Notwithstanding any provision of this Agreement, Haisco agrees that it  shall not, by virtue of this Agreement, acquire any right, title, and interest in or to the Aquestive  Housemarks or any goodwill associated therewith.  14.8.2 Upon and following the termination of this Agreement, except in  connection with any Supply of Product to Haisco after termination or expiration of this  Agreement, Haisco shall not use the Aquestive Housemarks or any other name or mark of  Aquestive.  15. MISCELLANEOUS  15.1 Independent Contractor.  Neither Aquestive nor Haisco, together in each case  with their respective employees and representatives, are under any circumstances to be  considered as employees, partners, joint venturers, agents, or representatives of the other by  virtue of this Agreement, and neither shall have the authority or power to bind the other or  contract in the other’s name.  15.2 Registration and Filing of this Agreement.  To the extent, if any, that either  Party concludes in good faith that it or is required to file or register this Agreement or a  notification thereof with any Regulatory Authority including, without limitation, the U.S.  Securities and Exchange Commission or the U.S. Federal Trade Commission, in accordance with  Applicable Law, such Party shall (a) inform the other Party thereof, (b) provide copies of the  proposed disclosure to the other Party reasonably in advance of such filing or other disclosure  under the circumstances, (c) promptly notify the other Party in writing of such requirement and  any respective timing constraints, and (d) give the other Party a reasonable time under the  circumstances from the date of notice by such Party of the required disclosure to comment upon  and request confidential treatment for such disclosure; provided, that, the other Party shall  promptly review and provide comments regarding the proposed disclosure and the disclosing  Party will in good faith consider incorporating such comments.  15.3 Notices.  All notices or other communications required or permitted to be given  under any of the provisions of this Agreement shall be in writing in the English language, and  shall be deemed to have been duly given: (a) when personally received by the intended recipient;  (b) when delivered by messenger or internationally recognized delivery service (with  confirmation of receipt); (c) when delivered via e-mail or facsimile (and promptly confirmed by  mail); or (d) five (5) Business Days after having been mailed by first class registered or certified  mail, return receipt requested, postage prepaid, addressed to the applicable party at the address  indicated below, or to any other address or addressee as any Party may in the future specify by  notice to the other Party (with notice of change of address or addressee not being valid until  actually received):  





 






BUSINESS.29027546.1         48    If to Haisco: Haisco Pharmaceutical Group Co., Ltd.  No. 136 Baili Road CNSTP  Wenjiang District, Chengdu  Sichuan Province 611130  People’s Republic of China  Attention:  ZHOU Feng    With a copy to: Katten Muchin Rosenman LLP Shanghai Office  Unit 4906 Wheelock Square, 1717 W. Nanjing Rd.  Shanghai, 200040  People’s Republic of China  Attention:  XUE Feng    If to Aquestive: Aquestive Therapeutics, Inc.  30 Technology Drive  Warren, New Jersey 07059  Attn:  Daniel Barber, Senior Vice President, Chief  Operating Officer    With a copy to: Aquestive Therapeutics, Inc.  30 Technology Drive  Warren, New Jersey 07059  Attention:  Lori J. Braender, General Counsel    15.4 Binding Effect; No Assignment.  This Agreement shall be binding upon and  inure to the benefit of the Parties and their respective successors and permitted assigns. Except as  expressly set forth in this Agreement, neither Aquestive nor Haisco may assign any of its rights  or delegate any of its liabilities or obligations hereunder without the prior written consent of the  other Party; provided, however, that, without the prior written consent of the other Party: (a)  either Party may assign this Agreement to any purchaser of all or substantially all of its assets or  equity or business to which this Agreement relates or in connection with a merger of the Party  and (b) either Party may assign this Agreement and/or its rights and obligations under this  Agreement to any of its Affiliates.  Without the prior written consent of Haisco, Aquestive may  not assign any of its rights to receive payments of royalty fees or any other amounts due under  this Agreement to any of its Affiliates or any Third Party; for the avoidance of doubt, Aquestive  remains obligated to Haisco for the performance  of all of Aquestive’s obligations under this  Agreement.  The assignment of only a part of a Party’s rights under this Agreement in  accordance with this Section 15.4 shall not in any way create a contractual or business  relationship and no privity of contract or otherwise shall exist between the non-assigning Party  and the Third Party being assigned such rights and such Third Party shall not have any third- party beneficiary rights in this Agreement.  No assignment hereunder shall relieve the assigning  Party of its responsibilities or obligations hereunder; provided, further that (i) any assignee shall  agree in writing to be bound by all of the obligations of the assigning Party hereunder and (ii)  upon the non-assigning Party’s request, the assigning Party shall make such introductions to  





 






BUSINESS.29027546.1         49    assignee’s management as may be necessary to ensure efficient transition of the Agreement to  the assignee or successor. Any purported assignment or transfer in violation of this Section 15.4  shall be void ab initio and of no force or effect. This Agreement shall be binding upon and,  subject to the terms of the foregoing sentence, inure to the benefit of the Parties, their permitted  successors, legal representatives and assigns.  15.5 No Implied Waivers; Rights Cumulative.  No failure on the part of Aquestive  or Haisco to exercise and no delay in exercising any right, power, remedy or privilege under this  Agreement, or provided by statute or at law or in equity or otherwise, including the right or  power to terminate this Agreement, shall impair, prejudice or constitute a waiver of any such  right, power, remedy or privilege or be construed as a waiver of any breach of this Agreement or  as an acquiescence therein, nor shall any single or partial exercise of any such right, power,  remedy or privilege preclude any other or further exercise thereof or the exercise of any other  right, power, remedy or privilege.  15.6 Severability.  If any provision of this Agreement is held invalid or unenforceable  by any court of competent jurisdiction, the other provisions of this Agreement shall remain in  full force and effect.  Any provision of this Agreement held invalid or unenforceable only in part  or degree shall remain in full force and effect to the extent not held invalid or unenforceable.   The Parties further agree to replace such invalid or unenforceable provision of this Agreement  with a valid and enforceable provision that shall achieve, to the extent possible, the economic,  business, and other purposes of such invalid or unenforceable provision.  15.7 Force Majeure.  Neither Party shall be liable for delay in delivery or  nonperformance (except for any obligation for the payment of money), in whole or in part, nor  shall the other Party have the right to terminate this Agreement except as otherwise specifically  provided in this Section 15.7, to the extent that such delay in delivery or nonperformance is  caused by any of the following events that are reasonably beyond the control of such Party and  without the fault or negligence of such Party: fires, floods, embargoes, epidemics, pandemics,  quarantines, war, acts of war (whether war be declared or not), terrorism, insurrections, riots,  civil commotion, strikes, lockouts or other labor disturbances, acts of God or acts, omissions or  delays in acting by any Regulatory Authority, change in law, regulation or policy promulgated  by any Regulatory Authority (a “Force Majeure”); provided, however, that the Party affected by  such a condition shall, as soon as it becomes aware of same (but in any event within ten (10)  days of its occurrence), give written notice to the other Party stating the nature of the condition,  its anticipated duration and any action being taken to avoid or minimize its effect.  The  suspension of performance shall be of no greater scope and no longer duration than is reasonably  required and the nonperforming Party shall use its Commercially Reasonable Efforts to remedy  its inability to perform; provided, however, that in the event the suspension of performance  continues for a period of ninety (90) consecutive calendar days after the date of the occurrence,  and such failure to perform would constitute a material breach of this Agreement in the absence  of such force majeure event, the non-affected Party may terminate this Agreement immediately  by written notice to the other Party.  15.8 Amendment.  This Agreement may not be amended, and no provision hereof  may be modified or waived, except by an instrument in writing duly executed by each of the  Parties hereto.  





 






BUSINESS.29027546.1         50    15.9 Rules of Construction.  The Parties hereto agree that they have been represented  by counsel during the negotiation and execution of this Agreement and, therefore, waive the  application of any law, regulation, holding or ruling of construction providing that ambiguities in  an agreement or other document shall be construed against the Party drafting such agreement or  document.  15.10 Publicity.  The Parties acknowledge that each of Haisco and Aquestive intends to  issue press releases and other public statement disclosing the existence of or relating to this  Agreement, and each agrees to provide the other Party a copy of such release and statement and  to obtain the express written consent of the other Party, which consent shall not be unreasonably  withheld, conditioned or delayed; provided, however, that neither Party shall be prevented from  complying with any duty of disclosure it may have pursuant to Applicable Law, including  securities laws applicable to a public company. During the Term, Aquestive will have the right to  display the Haisco logo on the partnership page of its corporate website, and Haisco will have  the right to display the Aquestive logo on its corporate website.  15.11 Expenses.  Except as expressly set forth herein, each Party shall bear all fees and  expenses incurred by such Party in connection with, relating to or arising out of the execution,  delivery and performance of this Agreement and the consummation of the transactions  contemplated hereby, including attorneys’, accountants’ and other professional fees and  expenses.  15.12 Governing Law; Dispute Resolution.    15.12.1 This Agreement shall be governed by and construed in accordance  with the laws of the state of New York, United States without regarding to its conflict of laws  principles. The Parties expressly exclude application of the United Nations Convention for the  International Sale of Goods.  15.12.2 In the event of any dispute, claim, or controversy between the  Parties under this Agreement, the Parties will first attempt in good faith to resolve such dispute  by negotiation and consultation between themselves.  In the event that such dispute is not  resolved on an informal basis within ten (10) days, either Party may refer the matter to the  Parties’ Executive Officers for attempted resolution.  Each Party shall designate an “Executive  Officer” of its company as the designee in the event of any dispute that has not been resolved in  accordance with this Section 15.12.2.  The Executive Officer shall be the President of the  respective Party or his or her designee. The Executive Officers of the Parties will attempt in good  faith to resolve such dispute by negotiation and consultation for a thirty (30) day period  following such referral.  15.12.3  If the Executive Officers cannot reach consensus on a given matter  within thirty (30) days, then, such dispute, controversy, or claim that is not an “Excluded Claim”  shall be resolved by binding arbitration by the International Court of Arbitration of the  International Chamber of Commerce (“ICC”) in accordance with the rules of the ICC as in force  on the date on which the request for arbitration is filed (“ICC Rules”).  The place of arbitration  shall be Los Angeles, California, United States.  Such arbitration shall be conducted by a sole  arbitrator mutually selected by written agreement of the Parties.  In the event that the Parties are  





 






BUSINESS.29027546.1         51    not able to mutually select the sole arbitrator, the arbitration shall be conducted by a panel of  three arbitrators, consisting of one arbitrator to be selected by the Party referring such matter to  arbitration and one arbitrator to be selected by the other Party, and the third to be selected jointly  by the two arbitrators selected by the Parties in accordance with the ICC Rules.  The arbitration  shall be conducted in English.    15.12.4 It is the intention of the Parties that discovery procedures, although  permitted as described herein, will be limited except in exceptional circumstances. The  arbitrator(s) will permit such limited discovery procedures necessary for an understanding of any  legitimate issue raised in the arbitration, including the production of documents. No later than  thirty (30) days after selection of the arbitrator(s), the Parties and their representatives shall hold  a preliminary meeting with the arbitrator(s), to mutually agree upon and thereafter follow  procedures seeking to assure that the arbitration will be concluded within six (6) months from  such meeting. Failing any such mutual agreement, the arbitrator(s) will design and the Parties  shall follow procedures to such effect.  The arbitrator(s) will, in rendering its decision, apply the  governing law of the state of New York, United States without giving effect to any rules or laws  relating to arbitration.  Any award rendered by the arbitrator(s) will be final and binding, and  judgment may be entered upon it in any court of competent jurisdiction.  15.12.5 Either Party may apply to the arbitrator(s) for interim injunctive relief  until the arbitration award is rendered or the controversy is otherwise resolved. Either Party also  may, without waiving any remedy under this Agreement, seek from any court having jurisdiction  any injunctive or provisional relief necessary to protect the rights or property of that Party  pending the arbitration award. The arbitrator(s) shall have no authority to award punitive or any  other non-compensatory damages. Each Party shall bear its own costs and expenses and  attorneys’ fees and an equal share of the arbitrators’ and any administrative fees of arbitration.  15.12.6 Except to the extent necessary to confirm or enforce an award or as may  be required by law, neither a Party nor an arbitrator may disclose the existence, content, or  results of an arbitration without the prior written consent of both Parties. In no event shall an  arbitration be initiated after the date when commencement of a legal or equitable proceeding  based on the dispute, controversy or claim would be barred by the applicable New York statute  of limitations.  15.12.7 Notwithstanding anything to the contrary contained in this  Agreement, each of the Parties shall have the right to bring an action or claim for interim  measures, including specific performance or injunctive relief, in order to preserve its rights or  enforce the obligations of the other Party under this Agreement, in any court of competent  jurisdiction or having jurisdiction over any of the Parties or their respective assets, without the  need to first submit such matter to arbitration under this Section 15.12.   15.12.8 As used in this Section 15.12, the term “Excluded Claim” shall  mean a dispute, controversy or claim that concerns (i) the inventorship, validity, enforceability or  infringement of a patent, trademark or copyright; or (ii) any antitrust, anti-monopoly, anti- corruption or competition law or regulation, whether or not statutory.   





 






BUSINESS.29027546.1         52    15.13 Entire Agreement.  This Agreement contains the entire agreement between the  Parties with respect to the subject matter hereof and supersede all prior agreements, written or  oral, between the Parties.  15.14 Third Party Beneficiaries.  None of the provisions of this Agreement, express or  implied, is intended to be or shall be for the benefit of or enforceable by any Person (including,  without limitation, any creditor of either Party hereto) other than Haisco and Aquestive and their  respective successors and permitted assigns.  No such Person shall obtain any right under any  provision of this Agreement or shall by reasons of any such provision make any claim in respect  of any debt, liability, or obligation (or otherwise) against either Party.  15.15 Interpretation and Construction.  The headings of Sections in this Agreement  are provided for convenience only and shall not affect its construction or interpretation.  All  references to “Section” or “Sections” refer to the corresponding Section or Sections of this  Agreement.  All words used in this Agreement shall be construed to be of such gender or number  as the circumstances require.  Unless otherwise expressly provided in this Agreement, the word  “including” does not limit the preceding words or terms and shall be deemed to be followed by  the words “without limitation.” Unless otherwise expressly provided in this Agreement, the  terms “shall have responsibility for”, “shall be responsible for” or the like, shall be deemed to be  followed by “and shall be obligated to duly carry out such responsibility.”  15.16 Controlling Language. This Agreement and the Schedules hereto are prepared  and executed in the English language only, which language shall control and prevail in all  respects. The English language shall be used in the interpretation and performance of this  Agreement. Any translations of this Agreement into any other language are for reference only  and shall have no legal or other effect. Any notice which is required or permitted to be given by  one Party to the other under this Agreement shall be in the English language and shall be in  writing. All other correspondence and documentation required to be delivered to a Party under  this Agreement, arising out of or connected with this Agreement, and any related purchase  order(s) shall be in the English language; provided that if a document to be delivered under this  Agreement is in a language other than English in its original form, it shall be delivered in its  original language; at Aquestive’s written request, Haisco will provide Aquestive with a copy of  English translation of such document the cost of which shall be borne by Aquestive. All  proceedings related to this Agreement shall be conducted in the English language.  15.17 Counterparts; Signatures.  This Agreement may be executed in multiple  counterparts, all of which, when executed, shall be deemed to be an original and all of which  together shall constitute one and the same document.  Signatures provided by facsimile or e-mail  transmission shall be deemed to be original signatures.  





 






BUSINESS.29027546.1             IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by  their duly authorized representatives, effective as of the Effective Date.  AQUESTIVE THERAPEUTICS, INC.    By: /s/ Keith J. Kendall                   Name: Keith J. Kendall  Title:   President and Chief Executive Officer  HAISCO PHARMACEUTICAL GROUP, LTD.    By: /s/ Junming Wang   Name:  Junming Wang  Title:    Chairman