BE INCLUDED WITHIN COSTS.
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5.2.
PAYMENT FOR PRODUCT.
(A)
DISTRIBUTOR SHALL PAY COMPANY FOR INVOICES SUBMITTED PURSUANT TO
SECTION 4.9 WITHIN [***] DAYS OF THE DATE OF INVOICE, AND PAYMENT SHALL BE MADE
BY MEANS OF ELECTRONIC TRANSFER TO SUCH ACCOUNT AS COMPANY MAY DIRECT.
(B)
BEGINNING WITH THE CALENDAR QUARTER IN WHICH THE LAUNCH DATE FOR
THE PRODUCT OCCURS, AND FOR EACH CALENDAR QUARTER THEREAFTER, DISTRIBUTOR SHALL
PAY COMPANY THE SUPPLY PRICE FOR THE PRODUCT, AS DETERMINED PURSUANT TO SCHEDULE
3.2(A), LESS THE AMOUNT PREVIOUSLY PAID DURING SUCH CALENDAR QUARTER PURSUANT TO
SECTION 5.2(A), WITHIN [***] DAYS FOLLOWING THE END OF EACH SUCH CALENDAR
QUARTER.
EACH SUCH PAYMENT SHALL BE ACCOMPANIED BY A REPORT, SUMMARIZING THE
TOTAL GROSS SALES OF THE PRODUCT, ON A PRODUCT-BY-PRODUCT AND COUNTRY-BY-COUNTRY
BASIS, NET SALES FOR EACH (INCLUDING AN ITEMIZATION OF THE DEDUCTIONS APPLIED TO
SUCH GROSS SALES TO DERIVE SUCH NET SALES) DURING THE RELEVANT CALENDAR QUARTER,
THE CALCULATION OF THE TOTAL SUPPLY PRICE DUE THEREON AND ALL CREDITS APPLIED TO
SUCH AMOUNTS, INCLUDING THE COST OF THE PRODUCT BEING APPLIED AS A CREDIT
AGAINST ROYALTIES.
5.3.
LATE PAYMENTS.
IF DISTRIBUTOR FAILS TO PAY ON THE DUE DATE ANY
AMOUNT WHICH IS PAYABLE TO COMPANY UNDER THIS AGREEMENT THEN, WITHOUT PREJUDICE
TO SECTION 10 OF THIS AGREEMENT:
(A)
THAT AMOUNT SHALL BEAR INTEREST FROM THE DUE DATE UNTIL PAYMENT IS
MADE IN FULL AT THE PRIME RATE, AS PUBLISHED IN THE WALL STREET JOURNAL, EASTERN
EDITION, PLUS [***] PERCENT ([***]%), ON THE DUE DATE OF SUCH PAYMENT, OR, IF
LESS, AT THE MAXIMUM INTEREST RATE PERMITTED BY LAW; AND
(B)
IF PAYMENT IS MORE THAN THIRTY (30) DAYS PAST DUE, COMPANY SHALL
BE ENTITLED TO SUSPEND DELIVERIES OF PRODUCT TO DISTRIBUTOR UNTIL THE
OUTSTANDING AMOUNT HAS BEEN RECEIVED BY COMPANY.
6.
OBLIGATIONS OF COMPANY
6.1.
DISTRIBUTOR'S AUDIT RIGHTS.
COMPANY AGREES TO PERMIT UP TO THREE
(3) OF DISTRIBUTOR'S REPRESENTATIVES, UPON REASONABLE NOTICE, TO INSPECT THOSE
AREAS OF THE COMPANY'S FACILITIES WHERE THE PRODUCT IS MANUFACTURED AND TESTED,
FOR THE PURPOSE OF VERIFYING COMPLIANCE WITH APPLICABLE LAWS AS WELL AS WITH
THIS AGREEMENT.
6.2.
RAW MATERIALS.
COMPANY SHALL SOURCE FOR ITSELF ALL MATERIALS
NECESSARY IN CONNECTION WITH THE MANUFACTURING OF THE PRODUCT.
COMPANY SHALL BE
SOLELY RESPONSIBLE FOR ENSURING THAT ALL SUCH MATERIALS ARE OF SUFFICIENT
QUALITY AND MEET OTHER RELEVANT STANDARDS IN ORDER FOR IT TO BE UTILIZED BY
COMPANY IN THE MANUFACTURE OF THE PRODUCT.
THE COST OF ALL SUCH ANALYSES AND
EVALUATIONS SHALL BE BORNE BY COMPANY AND SHALL BE INCLUDED WITHIN COSTS.
COMPANY AGREES TO MAINTAIN AND, IF NECESSARY, MAKE AVAILABLE RECORDS OF ALL SUCH
ANALYSES AND EVALUATIONS.
6.3.
PROCESSING AND TESTING.
COMPANY SHALL BE RESPONSIBLE FOR ALL
PROCESS, ANALYTICAL METHOD, EQUIPMENT AND CLEANING VALIDATION AND SHALL TAKE ALL
STEPS NECESSARY TO PASS ANY
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APPLICABLE GOVERNMENT INSPECTION BY THE FDA.
ALL MANUFACTURING, PACKAGING,
CLEANING AND ANALYTICAL METHODS AND PROCESSES MUST BE VALIDATED BY COMPANY.
VALIDATION PROTOCOL AND REPORTS ARE TO BE PROVIDED TO THE DISTRIBUTOR UPON