Sano Draft - CONFIDENTIAL

Project Reno – Earn-Out Insert to Merger Agreement1

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In addition to the Closing Purchase Price, Sano shall pay, in cash, to the stockholders of
Denove as of immediately prior to the Closing (the “Sellers”) their respective Pro Rata Portion
(as defined below) of the Milestone Payment Amount, if any, at the times and in the manner set
forth below.

1. Payment Obligation. If the Milestone occurs prior to the expiration of a Sales

Measurement Period, then, on or prior to the Milestone Payment Date, Sano shall pay, or cause
to be paid, to Sellers an aggregate lump-sum cash payment equal to the applicable Milestone
Payment Amount.

2. Certain Definitions.

“Closing Date” has the meaning set forth in the Agreement.

“First Sales Measurement Period” means the period beginning on the Closing Date and
ending December 31 of the first calendar year following the Closing Date.

“Imputed Net Sales” means, (a) the amount equal to (i) the cumulative Net Sales of the
Product in the period from the Closing Date to the end of the First Sales Measurement Period,
divided by (ii) the number of days in the period from the Closing Date to the end of the First
Sales Measurement Period, multiplied by (iii) the number of days from June 30 of the calendar
year to the Closing Date, minus (b) the cumulative Net Sales of the Product in the period from
June 30 to the Closing Date. For the avoidance of doubt, Imputed Net Sales shall be $0 if (a) the
Closing Date is on or prior to June 30 of any calendar year or (b) the calculation of Imputed Net
Sales is negative.

“Independent Accountant” means an independent certified public accounting firm of

nationally recognized standing designated either (a) jointly by the Sellers and Sano, or (b) if such
parties fail to make a designation, jointly by an independent public accounting firm selected by
the Sellers and an independent public accounting firm selected by Sano.

“Milestone” means the first occurrence and only the first occurrence of either (i) the sum
of (A) the cumulative Net Sales of the Product during the First Sales Measurement Period, plus
(B) the Imputed Net Sales (if any) equaling or exceeding $30,000,000, or (ii) the sum of (A) the
cumulative Net Sales of the Product during the Second Sales Measurement Period, plus (B) the
Imputed Net Sales (if any) equaling or exceeding $50,000,000.

“Milestone Payment Amount” means (a) if the Milestone occurs during the First Sales
Measurement Period, $25,000,000, or (b) if the Milestone occurs during the Second Sales
Measurement Period $15,000,000.

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Note to Draft: Defined terms not otherwise defined herein shall have the meaning set forth in
the Merger Agreement.

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 “Milestone Payment Date” means the date that is forty-five (45) days following the last
day of the applicable Sales Measurement Period.

“Net Sales” means the gross amount invoiced by Sano or its affiliates (without double
counting) to third parties for the Product, less (without double counting):

(a) trade, quantity and cash discounts allowed;

(b) discounts, refunds, rebates, chargebacks, retroactive price adjustments, and any other
allowances which effectively reduce the net selling price;

(c) product returns and allowances;

(d) that portion of the sales value associated with drug delivery systems;

(e) any tax imposed on the production, sale, delivery or use of the Product, including,
without limitation, sales, use, excise or value added taxes;

(f) wholesaler inventory management fees;

(g) allowance for distribution expenses (other than distribution expenses incurred by
Sano); and

(h) any other similar and customary deductions which are in accordance with generally
accepted accounting principles.

“Pro Rata Portion” means, with respect to each Seller, the ratio determined by dividing
(1) the total number of shares of common stock of Denove owned by such Seller outstanding as
of immediately prior to the Closing, by (2) the total number of shares of common stock of
Denove outstanding as of immediately prior to the Closing.

“Product” means any pharmaceutical product for human use that contains ASG-1014FK
as an active pharmaceutical ingredient, in each case, alone or in combination with one or more
additional active pharmaceutical ingredients and including all formulations and line extensions
thereof.

“Sales Measurement Period” means each of the First Sales Measurement Period and the
Second Sales Measurement Period.

“Second Sales Measurement Period” means the period beginning on the Closing Date and
ending December 31 of the second calendar year following the Closing Date.

3. Statement. Within ten (10) days of each Sales Measurement Period, Sano shall
provide to the Sellers a written statement of Net Sales and Imputed Net Sales for such period
(“Milestone Statement”), setting forth the Sano’s calculation of Net Sales and Imputed Net Sales
with respect to such Sales Measurement Period, including reasonable evidence for support
thereof. At the sole expense of the Sellers, Sano shall reasonably cooperate in good faith with
the Sellers and their authorized representatives in connection with the Sellers’ review of such

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Milestone Statement. Any of the Sellers shall be entitled to object to the calculation of the
amount of Net Sales and/or Imputed Net Sales for each Sales Measurement Period by delivery to
Sano of written notice of objection, setting forth in reasonable detail the basis for such
disagreement, including Sellers’ determination of any amount therein that is disputed (an
“Objection Notice”). If no Seller delivers an Objection Notice to Sano within thirty (30) days
following the Sellers’ receipt of the Milestone Statement for the particular Sales Measurement
Period, then the determination by the Sano of the Net Sales and the Imputed Net Sales with
respect to such Sales Milestone Period as set forth in the Milestone Statement shall be final and
binding on the parties. If the Sellers timely deliver an Objection Notice to Sano, then any dispute
with respect to the applicable Sales Milestone Period shall be resolved in good faith, and, the
parties cannot resolve such dispute, the parties shall engage, at Sano’s expense, an Independent
Accountant, whose determinations with respect to any such disputes shall be final and binding on
the parties.

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