Common use of PAYMENT AND ROYALTY REPORTS Clause in Contracts

PAYMENT AND ROYALTY REPORTS. 2.1 Within forty-five days (45) following the end of each Fiscal Quarter, beginning with the first Fiscal Quarter in which Company commences activity in any Vertical Sector, the Company shall send to MercExchange reports of the Gross Transactions conducted by Aden, in the preceding Fiscal Quarter, showing their respective descriptions or other descriptive characteristics, including total quantities for transaction, and the sale price of any products or goods sold hereunder. 2.2 Each report shall be accompanied by the required payment in U.S. Dollars. For the Purpose of calculating the royalties payable hereunder, respective currencies for the Gross Transactions shall be converted to U.S. Dollars at the rate of exchange quoted in The Wall Street Journal in force on the last working day of the period for which payment of royalty is being made. 2.3 The Company shall maintain complete and accurate records of the Gross Transactions conducted under this Agreement, showing their respective descriptions or other descriptive characteristics, including model numbers, if any, quantities, and calculations of unit royalties dues and payable thereon. These records shall be maintained for a period of at least three (3) years subsequent to Company's latest quarterly royalty report. Periodically during the term of this Agreement and subsequent to the expiration or termination of this Agreement for any reason, upon 30 days prior written notice to Company and upon execution of a Confidentiality Agreement in Company's favor, MercExchange's independent duly appointed Certified Public Accountant may inspect Company's records which pertain to Gross Transactions during regular business hours for the purpose of verifying the completeness and accuracy of all reports to MercExchange. Such inspection shall occur no more frequently than once any Contract Year. If said audit determines that there has been a shortfall in royalties paid to MercExchange in excess of three percent (3%) of the amount actually due for the period under audit, then Company shall reimburse MercExchange for the reasonable expenses actually incurred by it for the audit.

PAYMENT AND ROYALTY REPORTS. 2.1 Within forty-five days Section 4.01. Running Royalties accrued during each quarter (45) following the end of each Fiscal Quarter, beginning with any part in the first Fiscal Quarter in which Company commences activity in any Vertical Sector, the Company shall send to MercExchange reports of the Gross Transactions conducted by Aden, in the preceding Fiscal Quarter, showing their respective descriptions or other descriptive characteristics, including total quantities for transaction, and the sale price of any products or goods sold hereunder. 2.2 Each report shall be accompanied by the required payment in U.S. Dollars. For the Purpose of calculating the royalties payable hereunder, respective currencies for the Gross Transactions shall be converted to U.S. Dollars at the rate of exchange quoted in The Wall Street Journal in force on the last working day of the period for which payment of royalty is being made. 2.3 The Company shall maintain complete and accurate records of the Gross Transactions conducted under this Agreement, showing their respective descriptions or other descriptive characteristics, including model numbers, if any, quantities, and calculations of unit royalties dues and payable thereon. These records shall be maintained for a period of at least three (3quarter) years subsequent to Company's latest quarterly royalty report. Periodically during the term of this Agreement shall be paid to Eiken or any other person designated by Eiken in writing from time to time within thirty (30) days after the end of such quarter. Section 4.02. Each Running Royalty payment shall be accompanied by a royalty report, substantially in the form attached hereto as Schedule II covering the immediately preceding quarter showing the computation of Running Royalties for such quarter. Each royalty report shall set out by product name, model and subsequent type of each of the Licensed Products used, sold or otherwise disposed of during the relevant quarter, the name of the manufacturer (whether Oxsed or any of its Affiliates sublicensed hereunder or third party subcontractor pursuant to Section 2.04), the unit price, the quantities, the country of use, sale or disposal, the relevant royalty rate, the gross amount received, the relevant currency, the deductible items and total amount set forth in the definition of the Net Sales and the total Net Sales of the Licensed Products. The royalty report shall also contain a calculation of the Running Royalties in Japanese Yen due under this Agreement and the exchange rates used therefor. The royalty report shall be certified by an authorized officer of Oxsed to be correct to the best knowledge and information of Oxsed. If no Running Royalties have accrued during a quarter, the royalty report shall so state. Section 4.03. The Initial License Fee, Additional License Fees, Running Royalties and any other amount payable to Eiken hereunder shall be payable to Eiken in Japanese Yen without any deduction of any remitting bank commission or fee or otherwise at the following bank account of Eiken or any other bank account Eiken notifies Oxsed in writing from time to time: Bank Name: [****] Branch Name: [****] Bank Address: [****] Type of Bank Account: [****] Bank Account Number: [****] Name of the Bank Account holder: [****] Section 4.04. For sales of Licensed Products made in currencies other than Japanese Yen during a quarter, Running Royalties shall be computed by converting the Net Sales into Japanese Yen at the wire transfer selling rate of exchange in effect on the closing of the last banking day during such quarter as quoted by [****]. Section 4.05. [****]. The Parties agree that the payments due to Eiken hereunder constitute “royalties” as that term is defined in Article 12, paragraph 2 of the Convention between Japan and the United Kingdom of Great Britain and Northern Ireland for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and on Capital Gains (the “Treaty”) and, as such, are exempt from British withholding tax under Article 12, paragraph 1 of the Treaty. Pursuant to such exemption, Oxsed shall not withhold any tax from any payments due to Eiken hereunder, and Eiken shall not be liable for any withholding taxes involved in this transaction. Eiken shall, in addition to providing a certificate of Japanese residency, complete all forms required for Oxsed to obtain such exemption and provide Oxsed with such forms. Section 4.06. Within thirty (30) days after expiration or termination of this Agreement, Oxsed shall furnish to Eiken a royalty report as set forth in Section 4.02 covering the Net Sales of the Licensed Products used, sold or otherwise disposed of prior to the expiration or termination date but as to which no Running Royalties were previously paid, which report also shall set forth the total quantity of this Agreement for Oxsed’s and its Affiliates’ inventory (including work-in-process) of the Licensed Products existing as of the expiration or termination date and in possession of Oxsed and all of its Affiliates, and Oxsed shall simultaneously pay Running Royalties to Eiken with respect to the Licensed Products made, used or sold in the Territory and inventory thereof. The Running Royalties with respect to Oxsed’s and its Affiliates’ inventory existing as of the expiration or termination date shall be determined as if such inventory were sold in the Territory immediately prior to the expiration or termination date. Section 4.07. In the event that any reasonamount due Eiken by Oxsed hereunder is not paid when due, upon 30 days prior written notice Oxsed shall pay on demand to Company Eiken interest on the overdue amount at the Interest Rate from the due date of such amount until the date such overdue amount is paid in full. Section 4.08. Oxsed shall keep, and upon execution Oxsed shall cause its Affiliates to keep, accurate and complete records and books of a Confidentiality Agreement account containing regular entries in Company's favor, MercExchange's independent duly appointed Certified Public Accountant may inspect Company's records which pertain to Gross Transactions during regular business hours accordance with the IFRS consistently applied for the purpose of verifying calculating Running Royalties and making royalty reports pursuant to Section 4.02. All the completeness records and books of account relating to a particular fiscal year of Oxsed and such Affiliates shall be retained for a period of five (5) years following the close of such fiscal year. All records and books of account shall contain all information necessary to calculate Running Royalties hereunder and to determine the accuracy of all the royalty reports. Eiken shall have the right (which it may not exercise more than once for each year) to cause such records and books of account to be audited by an independent public accounting firm and a law firm selected by Eiken for the sole purpose of determining the accuracy of reports to MercExchangeand calculations of Running Royalties. Such inspection audits shall occur no more frequently than once be made during normal business hours of Oxsed or such Affiliates and with at least fifteen (15) day prior notice. All information disclosed to or obtained by the independent public accounting firm and the law firm during such audit shall not be disclosed to anyone including Eiken (except as required by law or by any Contract Year. If said audit determines governmental agency or tribunal, and except as may be necessary or proper in connection with any dispute or proceeding relating to this Agreement) and shall be held in strictest confidence, except that there the independent public accounting firm and the law firm may disclose to Eiken whether a discrepancy in Running Royalty payments has been a shortfall in royalties paid found, the amount of the discrepancy involved, and the circumstance of the discrepancy, including the basis upon which the discrepancy is determined. In the event that such audit reveals that Oxsed underpaid or under-reported Running Royalties due Eiken, Oxsed shall promptly upon demand pay to MercExchange Eiken the deficiency and interest thereon under Section 4.07, and if such deficiency is in excess of three [****] percent (3[****]%) of the amount actually due due, Oxsed shall also upon demand from Eiken reimburse Eiken for the period under audit, then Company shall reimburse MercExchange for the reasonable costs and expenses actually incurred by it for the in conducting such audit. Section 4.09. Oxsed shall faithfully respond with reasonable additional information to what Eiken may reasonably request from time to time to enable Eiken to ascertain a specific model or type of Licensed Products used, sold or otherwise disposed of by Oxsed or the Affiliates is subject to the payment of Running Royalties, and the amount of such Running Royalties due.

PAYMENT AND ROYALTY REPORTS. 2.1 Within forty-five days Section 4.01. Running Royalties accrued during each quarter (45) following the end of each Fiscal Quarter, beginning with any part in the first Fiscal Quarter in which Company commences activity in any Vertical Sector, the Company shall send to MercExchange reports of the Gross Transactions conducted by Aden, in the preceding Fiscal Quarter, showing their respective descriptions or other descriptive characteristics, including total quantities for transaction, and the sale price of any products or goods sold hereunder. 2.2 Each report shall be accompanied by the required payment in U.S. Dollars. For the Purpose of calculating the royalties payable hereunder, respective currencies for the Gross Transactions shall be converted to U.S. Dollars at the rate of exchange quoted in The Wall Street Journal in force on the last working day of the period for which payment of royalty is being made. 2.3 The Company shall maintain complete and accurate records of the Gross Transactions conducted under this Agreement, showing their respective descriptions or other descriptive characteristics, including model numbers, if any, quantities, and calculations of unit royalties dues and payable thereon. These records shall be maintained for a period of at least three (3quarter) years subsequent to Company's latest quarterly royalty report. Periodically during the term of this Agreement shall be paid to University or any other person designated by University in writing from time to time within thirty (30) days after the end of such quarter. Section 4.02. Each Running Royalty payment shall be accompanied by a royalty report, substantially in the form attached hereto as Schedule II covering the immediately preceding quarter showing the computation of Running Royalties for such quarter. Each royalty report shall set out by product name, model and subsequent type of each of the Licensed Products used, sold or otherwise disposed of during the relevant quarter, the name of the manufacturer (whether XYZ or any of its Affiliates), the name of subcontractor, the unit price, the quantities, the gross amount received, the relevant currency, the deductible items set forth in the definition of the Net Sales and the total Net Sales of the Licensed Products. The royalty report shall also contain a calculation of the Running Royalties in Japanese Yen due under this Agreement and the exchange rates used therefor. The royalty report shall be certified by an authorized officer of XYZ to be correct to the best knowledge and information of XYZ. If no Running Royalties have accrued during a quarter, the royalty report shall so state. Section 4.03. The Initial License Fee, Running Royalties and any other amount payable to University hereunder shall be payable to University in Japanese Yen without any deduction of any remitting bank commission or fee or otherwise at the following bank account of University or any other bank account University notifies XYZ in writing from time to time: Bank Name: Branch Name: Bank Address: Type of Bank Account: Bank Account Number: Name of the Bank Account holder: Section 4.04. For sales of Licensed Products made in currencies other than the Japanese Yen during a quarter, Running Royalties shall be computed by converting the Net Sales into Japanese Yen at the wire transfer selling rate of exchange in effect on the closing of the last banking day during such quarter as quoted by The Bank of Tokyo-Mitsubishi UFJ, Ltd. in Tokyo, Japan. Section 4.05. XYZ shall not be entitled to withhold or deduct from the payments due to University hereunder any present or future taxes, levies, imposts, deductions, charges, withholdings or liabilities imposed by any government or any political subdivision or taxing authority thereof in any jurisdiction. The Parties agree that the payments due to University hereunder constitute “royalties” as that term is defined in Article 12, paragraph 2 of the Convention between Japan and the United States of America for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income (the “Treaty”) and, as such, are exempt from the US withholding tax under Article 12, paragraph 1 of the Treaty. Pursuant to such exemption, XYZ shall not withhold any tax from any payments due to University hereunder, and University shall not be liable for any withholding taxes involved in this transaction. University shall, in addition to providing a certificate of Japanese residency, complete all forms required for XYZ to obtain such exemption and provide XYZ with such forms. [この源泉税の条項は相手方が米国の会社用。] Section 4.06. Within thirty (30) days after expiration or termination of this Agreement, XYZ shall furnish to University a royalty report as set forth in Section 4.02 covering the Net Sales of the Licensed Products used, sold or otherwise disposed of prior to the expiration or termination date but as to which no Running Royalties were previously paid, which report also shall set forth the total quantity of this Agreement for XYZ’s or its Affiliates’ inventory (including work-in-process) of the Licensed Products existing as of the expiration or termination date, and XYZ shall simultaneously pay Running Royalties to University with respect to the Licensed Products made, had made, used or sold in the Territory and inventory thereof. The Running Royalties with respect to XYZ’s or its Affiliates’ inventory existing as of the expiration or termination date shall be determined as if such inventory were sold in the Territory immediately prior to the expiration or termination date. Section 4.07. In the event that any reasonamount due University by XYZ hereunder is not paid when due, upon 30 days prior written notice XYZ shall pay on demand to Company University interest on the overdue amount at the Interest Rate from the due date of such amount until the date such overdue amount is paid in full. Section 4.08. XYZ shall keep, and upon execution XYZ shall cause its Affiliates to keep, accurate and complete records and books of a Confidentiality Agreement account containing regular entries in Company's favor, MercExchange's independent duly appointed Certified Public Accountant may inspect Company's records which pertain to Gross Transactions during regular business hours accordance with the IFRS consistently applied for the purpose of verifying calculating Running Royalties and making royalty reports pursuant to Section 4.02. All the completeness records and books of account relating to a particular fiscal year of XYZ and such Affiliates shall be retained for a period of five (5) years following the close of such fiscal year. All records and books of account shall contain all information necessary to calculate Running Royalties hereunder and to determine the accuracy of all the royalty reports. University shall have the right (which it may not exercise more than once for each year) to cause such records and books of account to be audited by an independent public accounting firm and a law firm selected by University for the sole purpose of determining the accuracy of reports to MercExchangeand calculations of Running Royalties. Such inspection audits shall occur no more frequently than once be made during normal business hours of XYZ or such Affiliates and with at least fifteen (15) day prior notice. All information disclosed to or obtained by the independent public accounting firm and the law firm during such audit shall not be disclosed to anyone including University (except as required by law or by any Contract Year. If said audit determines governmental agency or tribunal, and except as may be necessary or proper in connection with any dispute or proceeding relating to this Agreement) and shall be held in strictest confidence, except that there the independent public accounting firm and the law firm may disclose to University whether a discrepancy in Running Royalty payments has been a shortfall in royalties paid found, the amount of the discrepancy involved, and the circumstance of the discrepancy, including the basis upon which the discrepancy is determined. In the event that such audit reveals that XYZ underpaid or under-reported Running Royalties due University, XYZ shall promptly upon demand pay to MercExchange University the deficiency and interest thereon under Section 4.07, and if such deficiency is in excess of three five percent (35%) of the amount actually due due, XYZ shall also upon demand from University reimburse University for the period under audit, then Company shall reimburse MercExchange for the reasonable costs and expenses actually incurred by it for the in conducting such audit. Section 4.09. XYZ shall faithfully respond with reasonable additional information to what University may reasonably request from time to time to enable University to ascertain a specific model or type of Licensed Products used, sold or otherwise disposed of by XYZ or the Affiliates is subject to the payment of Running Royalties, and the amount of such Running Royalties due.