Common use of Independent Verification Clause in Contracts

Independent Verification. (i) Annually, as part of MPM’s and MSC’s annual budgeting process (or more frequently as determined by the Required Approval of the Steering Committee), the Steering Committee shall engage an independent, nationally recognized firm or consultant with appropriate experience and expertise (the “Audit Firm”) to undertake an audit as set forth herein. The Audit Firm shall be selected by the Steering Committee; provided, that, in the case of the first Past Period subject to this independent verification only (i.e., the review of fiscal year 2015), the Audit Firm shall be selected from among those firms listed on Exhibit G. Selection of the Audit Firm for subsequent Past Period reviews shall be made (A) by the Required Approval of the Steering Committee, and (B) if necessary, in accordance with Article XII. Fees and expenses of the Audit Firm in connection with such engagement shall be borne by MSC and MPM in accordance with their respective Allocation Percentage as may be adjusted following the results of such audit. (ii) The Audit Firm shall be given the mandate to review and assess the accuracy of the (1) Allocation Percentage determined in accordance with Section 5.01(c) for prospective application and (2) true-up of the Allocation Percentage (and the application thereof) and the determination of the Reconciliation Payments in accordance with Section 5.06(a). In determining its assessment, the Audit Firm shall evaluate the Services received or expected to be received by MSC and MPM, respectively, utilizing the Approved Metrics and, in the course of the Audit Firm’s review of the Approved Metrics themselves (but subject to the proviso in Section 5.01(c)(iii)), information maintained by or available to the Audit Firm regarding relevant good industry practice for shared services agreements of this kind. In connection with its engagement, MSC and MPM shall cause to be provided to the Audit Firm (1) the Allocation Percentage for all periods being reviewed, and a reasonably detailed description of the process and methodology by which such Allocation Percentage was determined, including backup and supporting materials, (2) all invoices for Estimated Monthly Allocation Payments, Quarterly Reports and invoices for Reconciliation Payments, and related supporting documentation, in each case for all periods being reviewed, (3) detail related to the Approved Metrics necessary to evaluate the Services used by MSC and MPM, and (4) such other financial and operating data as is reasonably requested by the Audit Firm in connection with its mandate set forth in this Section 5.06(b) and the applicable engagement letter. Each of MSC and MPM may provide information to the Audit Firm on a confidential basis, with the information so provided not subject to express inclusion in the report described below. Each of MSC and MPM shall make appropriate members of its management reasonably available to, and shall cause to cooperate with, the Audit Firm throughout its engagement. Each of MSC and MPM shall act in good faith to enable the Audit Firm to complete its written report within 60 days following the date the Audit Firm is engaged and by no later than April 30th of the fiscal year that is being budgeted in the applicable review process. (iii) Upon completion of its analysis as set forth in this Section 5.06(b), the Audit Firm shall provide to the Steering Committee (which shall provide copies to the MSC and MPM boards of directors) a written report summarizing the Audit Firm’s findings, including the accuracy of any adjustments or true-ups (or lack thereof) determined by the Steering Committee in accordance with Section 5.01(c) and Section 5.06(a). In the event the Audit Firm report identifies incorrect or otherwise deficient results in the Steering Committee’s determinations, the Steering Committee shall work in good faith with the Audit Firm in an effort to resolve and eliminate any discrepancies between the Steering Committee’s final determinations and the Audit Firm’s evaluation of those Steering Committee determinations. (iv) Prior to the Audit Firm’s delivery of the audit report described herein to the Steering Committee, the Audit Firm shall provide each of MSC and MPM executive management with at least one opportunity of at least one week to review and to provide complete comments on the Audit Firm’s proposed findings; provided that while the Audit Firm shall be obligated to consider MPM and MSC comments in good faith, the Audit Firm shall retain full discretion in conducting its review, reaching its findings, and formulating and presenting its findings.