Common use of PRODUCT ACCEPTANCE Clause in Contracts

PRODUCT ACCEPTANCE. (a) Customer shall have [***] after Delivery to notify Pfizer of any deficiencies or objections to the Product(s). Any notice of rejection by Customer shall be accompanied by a reasonably detailed statement of its reasons for rejection. Pfizer shall notify Customer in writing as promptly as practicable, but in any event, within [***] after receipt of such notice of rejection, whether it accepts or rejects Customer’s assertions of non-conformity or noncompliance. If Customer does not notify Pfizer of any objections to the Product(s) within the [***] period above noted, it will be conclusively presumed that the Product(s) are satisfactory. (b) In case of any disagreement between the Parties as to whether API Bulk Drug Substance conforms to the applicable Specifications, the quality assurance representatives of the Parties will discuss in good faith to attempt to resolve any such disagreement and Customer and Pfizer will follow their respective standard operating procedures to determine the conformity of the API Bulk Drug Substance to the Specifications. If the foregoing discussions do not resolve the disagreement in a reasonable time (which will not exceed [***], a sample of Pfizer’s USFDA retained sample and a sample of the API Bulk Drug Substance in question will be submitted for retesting by Pfizer and Customer on a side-by-side basis for final determination of whether such API Bulk Drug Substance conforms to the Specifications. Such retesting will be performed in a laboratory designated by Customer and agreed to by Pfizer using the test methods referenced in the Specifications contained in this Agreement and with representatives from both Parties present at all retesting. The determination of conformance or nonconformance by such retesting with respect to all or part of such API Bulk Drug Substance will be final and binding on the Parties. The expenses of such retesting shall be borne by Pfizer if the testing confirms nonconformance, and otherwise by Customer if the testing confirms conformance. (c) If Pfizer accepts Customer’s assertion that a Batch of API Bulk Drug Substance failed to conform to the Specifications, or if such API Bulk Drug Substance is found under Section 2.04(b) not to conform to the Specifications, then Pfizer will, at Pfizer’s sole option, (i) refund in full the fees and expenses paid by Customer for such Batch; or (ii) at Pfizer’s cost and expense, produce a new Batch of API Bulk Drug Substance as soon as reasonably possible; or (iii) Rework or Reprocess the API Bulk Drug Substance, at Pfizer’s cost and expense, so that the Batch conforms to Specifications. PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 406 OF THE SECURITIES ACT; [***] DENOTES OMISSIONS. (d) If Pfizer requests that Customer return or dispose of any nonconforming or noncomplying API Bulk Drug Substance, Pfizer will reimburse Customer for reasonable return shipping charges incurred by Customer for such return shipment or lawful disposal of such nonconforming or noncomplying API Bulk Drug Substance. Pfizer shall give Customer written instructions as to how Customer should lawfully dispose of such nonconforming or noncomplying API Bulk Drug Substance, and Customer shall provide Pfizer with written certification of such destruction. Pfizer shall reimburse Customer for reasonable expenses incurred by Customer for such lawful disposal of such nonconforming or noncomplying API Bulk Drug Substance.

PRODUCT ACCEPTANCE. PRODUCT is subject to Company's acceptance testing to assure conformance to specifications. Supplier shall submit two (unless another number is mutually agreed to) production samples of PRODUCT (referred to herein collectively as or "sample(s)") produced in a continuous run on permanent production tooling to a location designated by Company for examination. Company shall evaluate samples and issue a written acceptance or rejection to Supplier within forty five (45) days after receipt of samples. The failure by Company to reject with cause within such time shall constitute acceptance. Any rejection shall identify the failure to meet specifications in reasonable detail sufficient to allow Supplier to correct the deficiency. If a sample evaluated pursuant to this Section is rejected, Supplier agrees to correct, at its expense, the failure to meet the specifications (referred to herein collectively as "defect") leading to such rejection and resubmit a corrected sample to Company within thirty (30) days after receipt of notice from Company of such defect (collectively referred to herein as the "Corrective Period"). Company shall have thirty (30) days after the resubmitting of the corrected sample to accept or reject such deliverable. If the defects in a rejected sample are not corrected within the Corrective Period or if a resubmitted sample re-tested or re-evaluated by Company during the thirty (30) day re-evaluation period is again rejected, Company may at its option: (a) Customer shall have [***] after Delivery to notify Pfizer of any deficiencies or objections to accept the Product(s). Any notice of rejection by Customer shall be accompanied by a reasonably detailed statement of its reasons for rejection. Pfizer shall notify Customer in writing sample as promptly as practicable, but in any event, within [***] after receipt of such notice of rejection, whether it accepts or rejects Customer’s assertions of non-conformity or noncompliance. If Customer does not notify Pfizer of any objections to the Product(s) within the [***] period above noted, it will be conclusively presumed that the Product(s) are satisfactory. is; (b) In case of any disagreement between the Parties as to whether API Bulk Drug Substance conforms to the applicable Specifications, the quality assurance representatives of the Parties will discuss in good faith to attempt to resolve any such disagreement and Customer and Pfizer will follow their respective standard operating procedures to determine the conformity of the API Bulk Drug Substance to the Specifications. If the foregoing discussions do not resolve the disagreement in a reasonable time (which will not exceed [***], a sample of Pfizer’s USFDA retained sample and a sample of the API Bulk Drug Substance in question will be submitted for retesting by Pfizer and Customer on a side-by-side basis for final determination of whether such API Bulk Drug Substance conforms to the Specifications. Such retesting will be performed in a laboratory designated by Customer and agreed to by Pfizer using the test methods referenced in the Specifications contained in this Agreement and with representatives from both Parties present at all retesting. The determination of conformance afford Supplier one or nonconformance by such retesting with respect to all more correction extensions; or part of such API Bulk Drug Substance will be final and binding on the Parties. The expenses of such retesting shall be borne by Pfizer if the testing confirms nonconformance, and otherwise by Customer if the testing confirms conformance. (c) If Pfizer accepts Customer’s assertion that a Batch of API Bulk Drug Substance failed terminate the applicable SPA and purchase orders issued hereunder without any cost or charge to conform to the SpecificationsCompany whatsoever, including costs or if such API Bulk Drug Substance is found under Section 2.04(b) not to conform to the Specifications, then Pfizer will, at Pfizer’s sole option, (i) refund in full the fees and expenses paid by Customer for such Batch; or (ii) at Pfizer’s cost and expense, produce a new Batch of API Bulk Drug Substance as soon as reasonably possible; or (iii) Rework or Reprocess the API Bulk Drug Substance, at Pfizer’s cost and expense, so that the Batch conforms to Specifications. PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 406 OF THE SECURITIES ACT; [***] DENOTES OMISSIONS. (d) If Pfizer requests that Customer return or dispose of any nonconforming or noncomplying API Bulk Drug Substance, Pfizer will reimburse Customer for reasonable return shipping charges incurred by Customer for such return shipment Supplier in procuring equipment, material and special tooling to perform any part of this Agreement, loss of profits or lawful disposal of such nonconforming or noncomplying API Bulk Drug Substance. Pfizer shall give Customer written instructions as to how Customer should lawfully dispose of such nonconforming or noncomplying API Bulk Drug Substancelabor, and Customer materials expended in the production of samples. If Company opts to perform testing at Supplier's facility, Supplier shall provide Pfizer with written certification allow Company to send a representative(s) to observe and participate in the testing. Supplier shall not make any shipments under this Agreement prior to correction of such destructiondefects and approval of the production samples. Pfizer shall reimburse Customer for reasonable expenses incurred by Customer for such lawful disposal of such nonconforming or noncomplying API Bulk Drug SubstanceCompany will return samples to Supplier.

PRODUCT ACCEPTANCE. (a) Customer QMS shall have be entitled to reject all or any portion of a shipment of Licensed Products within [***] days of delivery of such shipment of Licensed Products to QMS, based solely on obvious physical, packaging or Labeling damage or defect that would be evident upon visual inspection of the packaged Licensed Products and discoverable without affecting the integrity of the Licensed Product packaging, as shipped by Q-Med (unless such obvious physical, packaging or Labeling damage or defect was attributable to an act or omission * Confidential treatment requested; certain information omitted and filed separately with the SEC. of QMS or any of its Affiliates or any carrier after Delivery to notify Pfizer delivery by Q-Med in accordance with this Agreement (a “Visual Non-Conformity”). If QMS does not provide written notice of any deficiencies or objections to such rejection within the Product(s). Any notice of rejection by Customer shall be accompanied by period set forth above together with a reasonably detailed statement to support any such rejection, then QMS shall be deemed to have accepted the entire shipment and waived its right to reject the shipment based upon a Visual Non-Conformity. QMS shall provide Q-Med with written notice of its reasons for any such rejection within the period set forth above together with a reasonably detailed statement to support any such rejection. Pfizer Q-Med shall notify Customer in writing QMS as promptly as practicablereasonably possible, but in any event, event within [***] Business Days after receipt of such written notice, whether it agrees with QMS’ assertions with respect thereto. If Q-Med agrees with such assertions, all such rejected Licensed Products shall be returned to Q-Med together with the notice of rejection, whether it a copy of the delivery receipt and the reasonably detailed statement of QMS’ reasons for rejection and Q-Med shall replace such Licensed Products and shall reimburse QMS for the cost of shipping (including insurance). If Q-Med does not agree with QMS’ assertions and QMS accepts or rejects CustomerQ-Med’s assertions determination, then QMS shall be responsible for the price of the Licensed Product (including the shipping cost and insurance), and if QMS does not accept Q-Med’s determination, then the Parties shall refer the dispute to a mutually acceptable independent testing laboratory for final resolution. If such independent laboratory affirms QMS’ finding of a Visual Non-Conformity, Q-Med shall promptly supply QMS with the same quantity of such Licensed Product so found to be non-conformity or noncompliance. If Customer does not notify Pfizer of any objections to the Product(s) within the [***] period above noted, it will be conclusively presumed that the Product(s) are satisfactory. (b) In case of any disagreement between the Parties as to whether API Bulk Drug Substance conforms to the applicable Specifications, the quality assurance representatives of the Parties will discuss in good faith to attempt to resolve any such disagreement and Customer and Pfizer will follow their respective standard operating procedures to determine the conformity of the API Bulk Drug Substance to the Specifications. If the foregoing discussions do not resolve the disagreement in a reasonable time (which will not exceed [***], a sample of Pfizer’s USFDA retained sample and a sample of the API Bulk Drug Substance in question will be submitted for retesting by Pfizer and Customer on a side-by-side basis for final determination of whether such API Bulk Drug Substance conforms to the Specifications. Such retesting will be performed in a laboratory designated by Customer and agreed to by Pfizer using the test methods referenced in the Specifications contained in this Agreement and with representatives from both Parties present at all retestingconforming. The determination of conformance or nonconformance by such retesting with respect to all or part cost of such API Bulk Drug Substance will be final and binding on the Parties. The expenses of such retesting independent laboratory shall be borne by Pfizer if the testing confirms nonconformanceParty whose findings are contrary to the findings of such independent laboratory. While any dispute regarding nonconformity of Licensed Product is pending, Q-Med, using Commercial Reasonable Efforts, shall replace any shipment or portion of a shipment under dispute, and otherwise by Customer if QMS shall pay the testing confirms conformance. (c) If Pfizer accepts Customer’s assertion that applicable Purchase Price, subject to a Batch of API Bulk Drug Substance failed to conform to the Specifications, or credit if such API Bulk Drug Substance dispute is found under Section 2.04(b) not to conform to resolved in QMS’ favor. * Confidential treatment requested; certain information omitted and filed separately with the Specifications, then Pfizer will, at Pfizer’s sole option, (i) refund in full the fees and expenses paid by Customer for such Batch; or (ii) at Pfizer’s cost and expense, produce a new Batch of API Bulk Drug Substance as soon as reasonably possible; or (iii) Rework or Reprocess the API Bulk Drug Substance, at Pfizer’s cost and expense, so that the Batch conforms to Specifications. PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 406 OF THE SECURITIES ACT; [***] DENOTES OMISSIONSSEC. (d) If Pfizer requests that Customer return or dispose of any nonconforming or noncomplying API Bulk Drug Substance, Pfizer will reimburse Customer for reasonable return shipping charges incurred by Customer for such return shipment or lawful disposal of such nonconforming or noncomplying API Bulk Drug Substance. Pfizer shall give Customer written instructions as to how Customer should lawfully dispose of such nonconforming or noncomplying API Bulk Drug Substance, and Customer shall provide Pfizer with written certification of such destruction. Pfizer shall reimburse Customer for reasonable expenses incurred by Customer for such lawful disposal of such nonconforming or noncomplying API Bulk Drug Substance.

PRODUCT ACCEPTANCE. (a) Customer shall have [***] after Delivery to notify Pfizer in writing of any deficiencies or objections to the Product(s)) within [***] after the delivery date. Any notice of rejection by Customer shall be accompanied by a reasonably detailed statement of its reasons for rejection. Pfizer shall notify Customer in writing as promptly as practicable, but in any event, within event [***] after receipt of such notice of rejection, whether it Pfizer accepts or rejects Customer’s assertions of non-conformity or noncompliancenon-compliance. If Customer does not fails to notify Pfizer of any objections to the Product(s) within the above-noted [***] period above notedperiod, it will the Products shall be conclusively presumed that the Product(s) are satisfactorysatisfactory and deemed accepted. (b) In case of any disagreement between If the Parties disagree as to whether API Bulk Drug Substance Product conforms to the applicable Specifications, the Parties’ quality assurance representatives of the Parties will discuss shall attempt in good faith to attempt to resolve any such disagreement and Customer and Pfizer will follow their respective standard operating procedures SOPs to determine the conformity of the API Bulk Drug Substance Product to the Specifications. If the foregoing discussions do not resolve the disagreement in within a reasonable time (which will not exceed [***], the Parties will submit a sample of Pfizer’s USFDA retained sample and a representative sample of the API Bulk Drug Substance in question will be submitted Product to an independent testing laboratory mutually agreed upon by the Parties for retesting by Pfizer and Customer on a side-by-side basis for final determination of whether such API Bulk Drug Substance the Product conforms to the Specifications. The laboratory must meet cGMP and be of recognized standing in the industry and, provided that the laboratory meets such requirements, neither Party shall unreasonably withhold, condition or delay its consent to the appointment of such laboratory. Such retesting laboratory will be performed in a laboratory designated by Customer and agreed to by Pfizer using use the test methods referenced contained in the Specifications contained in this Agreement and with representatives from both Parties present at all retestingSpecifications. The determination of conformance or nonconformance by such retesting laboratory with respect to all or part of such API Bulk Drug Substance Product will be final and binding on the Parties. The fees and expenses of incurred by the laboratory in making such retesting shall determination will be borne by Pfizer if the testing confirms nonconformance, and otherwise by Customer if the testing confirms conformancepaid [***]. (c) If Pfizer accepts Customer’s assertion that a Batch of API Bulk Drug Substance failed Product fails to conform to the Specifications, or if such API Bulk Drug Substance Batch of Product is found under this Section 2.04(b) not to conform to the Specifications, Signature Version Confidential then Pfizer willthe parties will discuss and mutually agree, at Pfizer’s sole option, (i) refund in full the fees and expenses paid by Customer for such Batch; or (ii) at Pfizer’s cost and expense, produce a new Batch of API Bulk Drug Substance as soon as reasonably possible; or (iii) Rework or Reprocess the API Bulk Drug Substance, at Pfizer’s cost and expense, so that the Batch conforms to Specifications. PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 406 OF THE SECURITIES ACT; [***] DENOTES OMISSIONSof Pfizer’s notice of non-conformance to Customer, which of the following options Pfizer shall move forward with: (i) [***] (ii) [***] or (iii) [***]. (d) If Pfizer requests that Customer return or dispose of any nonconforming or noncomplying API Bulk Drug SubstanceProduct, Pfizer will reimburse Customer for reasonable return shipping charges [***] incurred by Customer for such return shipment or lawful disposal of such nonconforming or noncomplying API Bulk Drug SubstanceProduct. Pfizer shall give Customer written instructions as to how Customer should lawfully dispose of such nonconforming or noncomplying API Bulk Drug SubstanceProduct, and Customer shall provide Pfizer with written certification of such destruction. Pfizer shall reimburse Customer for reasonable expenses incurred by Customer [***] for such lawful disposal of such nonconforming or noncomplying API Bulk Drug SubstanceProduct.

PRODUCT ACCEPTANCE. 7.1 Prior to shipment, Flextronics shall have tested all Products in accordance with the acceptance criteria and test procedures mutually agreed upon by the parties as set forth in the Specifications (“Acceptance Criteria”). Customer or its designated third party receiving the Products may reject Products that: (a) have been damaged prior to delivery due to [*], or (b) do not meet, [*], as determined on a reasonable basis by Customer or its third party receiving the Products (such rejected Products, the “Rejected Products”). 7.2 Customer will notify Flextronics in writing of any Rejected Products within [*] calendar days of receipt of such Products. Flextronics will provide Customer with a return materials authorization (RMA) for such Rejected Products within [*] working days of it receipt of such notice. Customer shall return ship such Rejected Products [*] working days of its receipt of the RMA. Customer shall return all Products [*], to Flextronics’ mutually agreed upon RMA site, and for all shipments of returned Products Customer or Flextronics shall be the importer and/or exporter of record as applicable. 7.3 In inspecting the Products, Customer or its designated third party receiving the Products shall do so in accordance with [*]. Customer shall have [***] after Delivery the right to notify Pfizer of any deficiencies or objections to the Product(s). Any notice of rejection by Customer shall be accompanied by a reasonably detailed statement of its reasons for rejection. Pfizer shall notify Customer in writing as promptly as practicable, but in any event, within [***] after receipt of such notice of rejection, whether it accepts or rejects Customer’s assertions of non-conformity or noncompliance. If Customer does not notify Pfizer of any objections to the Product(s) within reject the [***] period above noted]. In such an event, it an RMA will be conclusively presumed that issued and the Product(s) are satisfactoryProducts returned pursuant to Section 7.2. (b) In case 7.4 Upon return of any disagreement between the Parties Rejected Products, Flextronics will, as soon as reasonably practical, inform Customer as to whether API Bulk Drug Substance conforms it agrees with Customer’s determination that the returned Products met the criteria necessary for them to the applicable Specifications, the quality assurance representatives be rejected by Customer (it shall perform such assessment as detailed in Section 8.3). If it agrees with Customer’s rejection of the Parties will Products, then, as Customer’s sole remedy and Flextronics’ exclusive obligation, Flextronics shall: (i) at Customer’s option, [*], (ii) [*] for the return shipping of such Products, and (iii) [*]. Notwithstanding the Customer’s right to elect a remedy, if Customer elects [*] is permitted by applicable law, then the parties shall mutually discuss and work in good faith to attempt agree to an appropriate remedy under the circumstances; [*]. In the case of Product replacement, title to returned Products will pass to Flextronics on delivery to Flextronics at the Incoterms point stated in Section 7.2, and title to the replacement Products will pass back to the Customer on re-delivery to the Customer in accordance with Section 5.2. [*]. If Flextronics does not agree with Customer’s rejection of the Products, then the parties will work in good faith to resolve any such disagreement and Customer and Pfizer will follow their respective standard operating procedures to determine the conformity of the API Bulk Drug Substance to the Specifications. If the foregoing discussions do not resolve the disagreement in a reasonable time (which will not exceed [***], a sample of Pfizer’s USFDA retained sample and a sample of the API Bulk Drug Substance in question will be submitted for retesting by Pfizer and Customer on a side-by-side basis for final determination of whether such API Bulk Drug Substance conforms to the Specifications. Such retesting will be performed in a laboratory designated by Customer and agreed to by Pfizer using the test methods referenced in the Specifications contained in this Agreement and with representatives from both Parties present at all retesting. The determination of conformance or nonconformance by such retesting with respect to all or part of such API Bulk Drug Substance will be final and binding on the Parties. The expenses of such retesting shall be borne by Pfizer if the testing confirms nonconformance, and otherwise by Customer if the testing confirms conformance. (c) If Pfizer accepts Customer’s assertion that a Batch of API Bulk Drug Substance failed to conform to the Specifications, or if such API Bulk Drug Substance is found under Section 2.04(b) not to conform to the Specifications, then Pfizer will, at Pfizer’s sole option, (i) refund in full the fees and expenses paid by Customer for such Batch; or (ii) at Pfizer’s cost and expense, produce a new Batch of API Bulk Drug Substance issues as soon as reasonably possible; or practicable under the circumstances. For any Products that were improperly rejected by Customer (iii) Rework or Reprocess the API Bulk Drug Substanceincluding those for which no defects are found), at Pfizer’s cost and expense, so that the Batch conforms to Specifications. PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 406 OF THE SECURITIES ACT; Customer remains responsible for [**]. If during [*] DENOTES OMISSIONSof the Products returned to Flextronics by Customer are found to be improperly rejected, then Flextronics may [*] improperly rejected Products [*]. (d) If Pfizer requests that 7.5 In the absence of a notification of rejection, the Customer return or dispose will be deemed to have accepted Products [*] calendar days after receipt of any nonconforming or noncomplying API Bulk Drug Substance, Pfizer will reimburse Customer for reasonable return shipping charges incurred by Customer for such return shipment or lawful disposal of such nonconforming or noncomplying API Bulk Drug Substance. Pfizer shall give Customer written instructions as to how Customer should lawfully dispose of such nonconforming or noncomplying API Bulk Drug Substance, and Customer shall provide Pfizer with written certification of such destruction. Pfizer shall reimburse Customer for reasonable expenses incurred by Customer for such lawful disposal of such nonconforming or noncomplying API Bulk Drug Substancethe applicable Products.

PRODUCT ACCEPTANCE. 7.1 Prior to shipment, Flextronics shall have tested all Products in accordance with the acceptance criteria and test procedures mutually agreed upon by the parties as set forth in the Specifications (“Acceptance Criteria”). Customer or its designated third party receiving the Products may reject Products that: (a) have been damaged prior to delivery due to [*], or (b) do not meet, [*], as determined on a reasonable basis by Customer or its third party receiving the Products (such rejected Products, the “Rejected Products”). 7.2 Customer will notify Flextronics in writing of any Rejected Products within [*] calendar days of receipt of such Products. Flextronics will provide Customer with a return materials authorization (RMA) for such Rejected Products within [*] working days of it receipt of such notice. Customer shall return ship such Rejected Products [*] working days of its receipt of the RMA. Customer shall return all Products [*], to Flextronics’ mutually agreed upon RMA site, and for all shipments of returned Products Customer or Flextronics shall be the importer and/or exporter of record as applicable. 7.3 In inspecting the Products, Customer or its designated third party receiving the Products shall do so in accordance with an acceptable quality limit (AQL) of [*]. Customer shall have [***] after Delivery the right to notify Pfizer of any deficiencies or objections to the Product(s). Any notice of rejection by Customer shall be accompanied by a reasonably detailed statement of its reasons for rejection. Pfizer shall notify Customer in writing as promptly as practicable, but in any event, within [***] after receipt of such notice of rejection, whether it accepts or rejects Customer’s assertions of non-conformity or noncompliance. If Customer does not notify Pfizer of any objections to the Product(s) within reject the [***] period above notedshould the Products being delivered not meet this AQL. In such an event, it an RMA will be conclusively presumed that issued and the Product(s) are satisfactoryProducts returned pursuant to Section 7.2. (b) In case 7.4 Upon return of any disagreement between the Parties Rejected Products, Flextronics will, as soon as reasonably practical, inform Customer as to whether API Bulk Drug Substance conforms it agrees with Customer’s determination that the returned Products met the criteria necessary for them to the applicable Specifications, the quality assurance representatives be rejected by Customer (it shall perform such assessment as detailed in Section 8.3). If it agrees with Customer’s rejection of the Parties will Products, then, as Customer’s sole remedy and Flextronics’ exclusive obligation, Flextronics shall: (i) at Customer’s option, [*], (ii) [*] for the return shipping of such Products, and (iii) [*]. Notwithstanding the Customer’s right to elect a remedy, if Customer elects [*] is permitted by applicable law, then the parties shall mutually discuss and work in good faith to attempt agree to resolve any such disagreement an appropriate remedy under the circumstances; [*]. In the case of Product replacement, title to returned Products will pass to Flextronics on delivery to Flextronics at the Incoterms point stated in Section 7.2, and Customer and Pfizer will follow their respective standard operating procedures to determine the conformity of the API Bulk Drug Substance title to the Specificationsreplacement Products will pass back to the Customer on re-delivery to the Customer in accordance with Section 5.2. If the foregoing discussions do not resolve the disagreement in a reasonable time (which will not exceed [***], a sample of Pfizertitle to the returned Products shall pass to Flextronics on delivery to Flextronics at the Incoterms point stated in Section 7.2. If Flextronics does not agree with Customer’s USFDA retained sample and a sample rejection of the API Bulk Drug Substance in question will be submitted for retesting by Pfizer and Customer on a side-by-side basis for final determination of whether such API Bulk Drug Substance conforms to the Specifications. Such retesting will be performed in a laboratory designated by Customer and agreed to by Pfizer using the test methods referenced in the Specifications contained in this Agreement and with representatives from both Parties present at all retesting. The determination of conformance or nonconformance by such retesting with respect to all or part of such API Bulk Drug Substance will be final and binding on the Parties. The expenses of such retesting shall be borne by Pfizer if the testing confirms nonconformance, and otherwise by Customer if the testing confirms conformance. (c) If Pfizer accepts Customer’s assertion that a Batch of API Bulk Drug Substance failed to conform to the Specifications, or if such API Bulk Drug Substance is found under Section 2.04(b) not to conform to the SpecificationsProducts, then Pfizer will, at Pfizer’s sole option, (i) refund the parties will work in full the fees and expenses paid by Customer for good faith to resolve such Batch; or (ii) at Pfizer’s cost and expense, produce a new Batch of API Bulk Drug Substance issues as soon as reasonably possible; or practicable under the circumstances. For any Products that were improperly rejected by Customer (iii) Rework or Reprocess the API Bulk Drug Substanceincluding those for which no defects are found), at Pfizer’s cost and expense, so that the Batch conforms Customer remains responsible for all costs to Specificationsredeliver such Products to Customer. PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 406 OF THE SECURITIES ACT; If during any quarter more than [**] of the Products returned to Flextronics by Customer are found to be improperly rejected, then Flextronics may charge Customer for its [*] DENOTES OMISSIONSimproperly rejected Products [*]. Customer remains liable for all costs to redeliver such Products to Customer. (d) If Pfizer requests that 7.5 In the absence of a notification of rejection, the Customer return or dispose will be deemed to have accepted Products [*] calendar days after receipt of any nonconforming or noncomplying API Bulk Drug Substance, Pfizer will reimburse Customer for reasonable return shipping charges incurred by Customer for such return shipment or lawful disposal of such nonconforming or noncomplying API Bulk Drug Substance. Pfizer shall give Customer written instructions as to how Customer should lawfully dispose of such nonconforming or noncomplying API Bulk Drug Substance, and Customer shall provide Pfizer with written certification of such destruction. Pfizer shall reimburse Customer for reasonable expenses incurred by Customer for such lawful disposal of such nonconforming or noncomplying API Bulk Drug Substancethe applicable Products.