Common use of Records; Inspection Clause in Contracts

Records; Inspection. TSD shall keep, and shall require its Permitted Sellers to keep, complete, true and accurate books of accounts and records for the purpose of determining the basis and accuracy of payments to be made under this Agreement. Such records shall be kept in accordance with generally accepted accounting principals, showing Net Sales of Product on a country-by-country and Product-by-Product bases, and TSD’s or its Permitted Sellers’ usual internal practices and procedures, consistently applied. Such books and records shall be kept for at least five (5) years following the end of the calendar quarter to which they pertain. Such records will be open for inspection by PPD during such five (5) year period by independent accountants reasonably acceptable to TSD, solely for the purpose of verifying the basis and accuracy of amounts in the payment statements hereunder. Such inspections shall be made no more than once each calendar year, at reasonable time and on reasonable notice and shall be limited to information related to Products. Results of any such inspection shall be deemed to be Confidential Information of TSD. If any errors in favor of TSD are discovered in the course of such inspection, then within thirty (30) days of written request by PPD, TSD shall pay PPD those amounts that PPD would [*] Confidential treatment requested; certain information omitted and filed separately with the SEC. have received in the absence of such errors, plus interest pursuant to and in accordance with Section 6.1(b). Inspections conducted under this Section 6.5 shall be at the expense of PPD, unless a variation or error in favor of TSD exceeding [*] percent ([*]%) of the amount stated for the period covered by the inspection is established in the course of such inspection, whereupon all costs relating to the inspection for such period will be paid promptly by TSD.

Records; Inspection. TSD Payor shall keep, and shall require its Permitted Sellers to keep, complete, true and accurate books of accounts and records for the purpose of determining the basis and accuracy of payments to be made under this Agreement. Such records shall be kept in accordance with generally accepted accounting principalsGAAP, showing Net Sales of Product on a country-by-country and Licensed Product-by-Licensed Product basesbasis, and TSDPayor’s or its Permitted Sellers’ usual internal practices and proceduresprocedures (which shall be commercially reasonable), consistently applied. Such books and records shall be kept for at least five [*] (5[*]) years following the end of the calendar quarter Calendar Quarter to which they pertain. Such records will be open for inspection by PPD Payee during such five (5) year period by independent accountants reasonably acceptable to TSDPayor, solely for the purpose of verifying the basis and accuracy of amounts in the payment statements hereunder. Such inspections shall be made no more than once [*] each calendar yearCalendar Year, at reasonable time and on reasonable notice and shall be limited to information related to Licensed Products. Results of any such inspection shall be deemed to be Confidential Information of TSDPayor. If any errors in favor of TSD Payor are discovered in the course of such inspection, then within thirty (30) days of written request by PPDPayee, TSD Payor shall pay PPD Payee those amounts that PPD Payee would [*] Confidential treatment requested; certain information omitted and filed separately with the SEC. have received in the absence of such errors, plus interest pursuant to and in accordance with Section 6.1(b6.1(c). Inspections conducted under this Section 6.5 shall be at the expense of PPDPayee, unless a variation or error in favor of TSD Payor exceeding [*] percent ([*]] %) of the amount stated due for the period covered by the inspection is established in the course of such inspection, whereupon all reasonable, documented costs relating to the inspection for such period will be paid promptly by TSDPayor. In the event of overpayment to Payee, any amount of such overpayment shall be fully creditable against amounts payable for the immediately succeeding Calendar Quarter.

Records; Inspection. TSD Amgen shall keep, keep (and shall cause its Affiliates and require its Permitted Sellers Sublicensees to keep, ) complete, true and accurate books of accounts and records for pertaining to the purpose sale or other disposition of determining Products (including the basis number of Products sold, the gross sales and accuracy of payments to be made under this Agreement. Such records shall be kept in accordance with generally accepted accounting principals, showing Net Sales of Product on a country-by-country and Product-by-Product basessuch Products, the royalties payable, the method used to calculate the royalties payable, and TSD’s the exchange rates used) and of Development Costs incurred pursuant to Section 3.2(c) or its Permitted Sellers’ usual internal practices 6.3, each in sufficient detail to permit verification of the amount of (a) royalty and proceduressales milestone payments due by Amgen to Xencor, consistently applied(b) if applicable, Development Costs for Incomplete Pre-POC Activities deductible by Amgen from Milestone payments hereunder, and (c) if applicable, Development Costs for the Post-Exercise Development Plan subject to sharing under the Co-Funding Arrangement. Such books and records shall be kept for at least five (5) years […***…] following the end of the calendar quarter year to which they pertain. Such records will pertain and shall be open for inspection and audit by PPD Xencor during such five (5) year […***…] period on the terms of this Section 6.13. Upon not less than […***…] prior written notice, Amgen shall permit an independent, certified public accountant selected by independent accountants Xencor and reasonably acceptable to TSDAmgen, solely which acceptance will not be unreasonably withheld (for the purposes of this Section 6.13, the “Auditor”), to audit or inspect such books and records, for the sole purpose of verifying whether there has been any under- or over-payment or *** Confidential Treatment Requested under- or over-statement of any such amount. The Auditor will disclose to Xencor only such information as is reasonably necessary for Xencor to determine its rights and obligations under this Article 6. The Auditor will send a copy of the basis report to Amgen at the same time it is sent to Xencor. The report sent to both Parties will include the methodology and accuracy of amounts in calculations used to determine the payment statements hereunderresults. Such inspections shall may be made no more than once each calendar year, at reasonable time year and on reasonable notice and during normal business hours. Such records for any particular calendar year shall be limited subject to information related no more than one inspection. The Auditor shall be obligated to Products. Results of execute a reasonable confidentiality agreement prior to commencing any such inspection shall be deemed to be Confidential Information of TSD. If any errors in favor of TSD are discovered in the course of such inspection, then within thirty (30) days of written request by PPD, TSD shall pay PPD those amounts that PPD would [*] Confidential treatment requested; certain information omitted and filed separately with the SEC. have received in the absence of such errors, plus interest pursuant to and in accordance with Section 6.1(b). Inspections conducted under this Section 6.5 6.13 shall be at the expense of PPDXencor, unless a variation or error producing an underpayment in favor of TSD amounts payable exceeding […*] percent ([**…]%) % of the amount stated paid for the a period covered by the inspection is established established, in which case the course of such inspection, whereupon all reasonable out-of-pocket costs relating to conduct the inspection for such period will and any unpaid amounts that are discovered shall be paid promptly by TSDAmgen, together with interest on such unpaid amounts at the rate set forth in Section 6.10 above. Xencor and the Auditor shall conduct any such inspection in a manner that minimizes disruption of Amgen’s normal business activities. Amgen shall use commercially reasonable efforts to obtain for Xencor the right to audit Sublicensees pursuant to the terms of this Section 6.13 and shall, at a minimum, obtain for itself reasonable and customary rights to audit Sublicensees for such purposes. If Amgen is unable to obtain the right for Xencor to audit a Sublicensee, then Amgen shall exercise its right to audit such Sublicensee at the request and expense of Xencor (subject to reimbursement by Amgen as set forth above) and provide a copy of its auditor’s report to Xencor at the same time it is sent to Amgen.

Records; Inspection. TSD Payor shall keep, and shall require its Permitted Sellers Affiliates and Sublicensees to keep, complete, true and accurate books of accounts and records for the purpose of determining the basis and accuracy of payments to be made under this Agreement, including royalties and reimbursement of Development Costs. Such records shall be kept in accordance with generally accepted accounting principalsGAAP and such entity’s usual internal practices and procedures (which shall be commercially reasonable) consistently applied, showing Net Sales of Product on a country-by-country and Licensed Product-by-Licensed Product basesbasis and Development Costs on an itemized basis, and TSD’s or its Permitted Sellers’ usual internal practices and procedures, consistently appliedas applicable. Such books and records shall be kept for at least five (5) [*] years following the end of the calendar quarter Calendar Quarter to which they pertain. Such records will be open for inspection by PPD Payee during such five (5) [*] year period by independent accountants reasonably acceptable to TSDPayor, solely for the purpose of verifying the basis and accuracy of amounts in the payment statements hereunder. Such inspections shall be made no more than once each calendar yearCalendar Year, at a reasonable time and on reasonable notice notice, and shall be limited to information related to Licensed Products. Results of any such inspection shall be deemed to be Confidential Information of TSDPayor, and any such independent accountant shall be required to enter into a customary confidentiality agreement with Payor. If any errors in favor of TSD Payor are discovered in the course of such inspection, then within thirty (30) days of written request by PPDPayee, TSD Payor shall pay PPD Payee those amounts that PPD Payee would [*] Confidential treatment requested; certain information omitted and filed separately with the SEC. have received in the absence of such errors, plus interest pursuant to and in accordance with Section 6.1(b7.1(c). Inspections conducted under this Section 6.5 7.5 shall be at the expense of PPDPayee, unless a variation or error in favor of TSD Payor exceeding [*] percent ([*]%) of the amount stated due for the period covered by the inspection is established in the course of such inspection, whereupon all reasonable, documented out-of-pocket costs relating to the inspection for such period will be paid promptly by TSDPayor. In the event of overpayment to Payee, any amount of such overpayment shall be fully creditable against amounts payable in any succeeding Calendar Quarter.

Records; Inspection. TSD shall keepLICENSEE agrees to maintain, and shall require its Permitted Sellers to keep, complete, true and accurate books of accounts and records for the purpose of determining the basis and accuracy of payments to be made under this Agreement. Such records shall be kept in accordance with generally accepted accounting principals, showing show Net Sales of Product on a country-by-country and Product-by-Product basesbasis, and TSDLICENSEE’s or its Permitted Sellers’ usual internal practices and proceduresprocedures (which shall be commercially reasonable), consistently applied, and GAAP or IFRS, consistently applied. Such books and records shall be kept for at least five (5) years [*] following the end of the calendar quarter Calendar Quarter to which they pertain. Such records will be open for inspection by PPD LICENSOR during such five (5) year [*] period by LICENSOR or independent accountants reasonably acceptable to TSDcertified public accountants, solely for the purpose of verifying the basis and accuracy of amounts in the payment statements hereunder. If requested by notice from LICENSOR, LICENSEE shall make, and cause to be made, such records available during normal business hours to enable such accountant to verify the accuracy of any payments made in accordance with this Agreement. Such inspections shall be made no more than once [*] each calendar yearCalendar Year, at reasonable time and on reasonable notice notice. Such accountant shall promptly report to LICENSOR only whether LICENSEE’s payments for the Product(s) and shall be limited to information related to Products. Results of any such inspection shall be deemed to be Confidential Information of TSDcalculations thereof are correct or incorrect, and, if incorrect, what, in said accountant’s professional opinion, the correct amounts should have been. If any errors in favor of TSD LICENSEE are discovered in the course of such inspection, then within thirty (30) days of upon written request notice by PPDLICENSOR to LICENSEE, TSD LICENSEE shall pay PPD those amounts that PPD would to LICENSOR within [*] Confidential treatment requested; certain information omitted and filed separately any amount owed to LICENSOR in accordance with the SEC. have received in the absence of such errors, findings plus interest pursuant to and in accordance with Section 6.1(b)8.2. Inspections conducted under this Section 6.5 The fees and expenses associated with any such audit shall be at borne by LICENSOR, provided that LICENSEE shall reimburse LICENSOR for the expense same in the event the audit reveals an underpayment by LICENSEE of PPD, unless a variation or error in favor of TSD exceeding more than [*] percent ([*]%) of the amount stated due for the period covered by the inspection is established in inspection. In the course event of overpayment to LICENSOR, any amount of such inspection, whereupon all costs relating to overpayment shall be fully creditable against amounts payable for the inspection for such period will be paid promptly by TSDimmediately succeeding Calendar Quarter. [*] Confidential treatment requested.