SUCH THIRD PARTY PAYMENTS.
NOTWITHSTANDING THE FOREGOING, SUCH
REDUCTIONS SHALL IN NO EVENT BE GREATER THAN THE ROYALTIES OTHERWISE DUE TO
IMMUNOGEN PURSUANT TO SECTION 4.5.1 HEREOF WITH RESPECT TO THE SALES OF SUCH
LICENSED PRODUCT IN SUCH COUNTRY BY MORE THAN [***] PERCENT ([***]%).
4.5.4
PAYMENT DATES AND REPORTS.
ROYALTY PAYMENTS SHALL BE MADE BY
SANOFI-AVENTIS WITHIN [***] ([***]) DAYS AFTER THE END OF EACH CALENDAR QUARTER
COMMENCING WITH THE CALENDAR QUARTER IN WHICH THE FIRST COMMERCIAL SALE OF A
LICENSED PRODUCT OCCURS.
ALL PAYMENTS SHALL BE MADE BY WIRE TRANSFER IN
ACCORDANCE WITH INSTRUCTIONS GIVEN IN WRITING FROM TIME TO TIME BY IMMUNOGEN.
SANOFI-AVENTIS SHALL ALSO PROVIDE, AT THE SAME TIME EACH SUCH PAYMENT IS MADE, A
REPORT SHOWING: (A) THE NET SALES OF EACH LICENSED PRODUCT BY COUNTRY IN THE
TERRITORY;(B) THE BASIS FOR ANY DEDUCTIONS FROM GROSS AMOUNTS BILLED OR INVOICED
TO DETERMINE NET SALES; (C) THE APPLICABLE ROYALTY RATES FOR SUCH LICENSED
PRODUCT; (D) THE EXCHANGE RATES USED IN CALCULATING ANY OF THE FOREGOING; AND
(E) A CALCULATION OF THE AMOUNT OF ROYALTY DUE TO IMMUNOGEN.
4.5.5
RECORDS; AUDIT RIGHTS.
FOR A PERIOD OF [***] ([***]) YEARS,
SANOFI-AVENTIS SHALL KEEP AND MAINTAIN, AND SHALL REQUIRE ITS RESPECTIVE
AFFILIATES AND SUBLICENSEES TO KEEP AND MAINTAIN, SUCH ACCURATE AND COMPLETE
BOOKS AND RECORDS IN CONNECTION WITH THE SALE OF LICENSED PRODUCTS HEREUNDER, AS
ARE NECESSARY TO ALLOW THE ACCURATE CALCULATION CONSISTENT WITH GENERALLY
ACCEPTED ACCOUNTING PRINCIPLES OF THE ROYALTIES DUE TO IMMUNOGEN, INCLUDING ANY
RECORDS REQUIRED TO CALCULATE ANY ROYALTY ADJUSTMENTS HEREUNDER.
ONCE PER
CALENDAR YEAR, IMMUNOGEN SHALL HAVE THE RIGHT TO ENGAGE AN INDEPENDENT CERTIFIED
PUBLIC ACCOUNTING FIRM OF NATIONALLY RECOGNIZED STANDING AND REASONABLY
ACCEPTABLE TO SANOFI-AVENTIS, WHICH SHALL HAVE THE RIGHT TO EXAMINE IN
CONFIDENCE THE RELEVANT BOOKS AND RECORDS OF SANOFI-AVENTIS AND ITS RESPECTIVE
AFFILIATES AND SUBLICENSEES AS MAY BE REASONABLY NECESSARY TO DETERMINE AND/OR
VERIFY THE AMOUNT OF ROYALTY PAYMENTS DUE HEREUNDER.
SUCH EXAMINATION SHALL BE
CONDUCTED, AND SANOFI-AVENTIS SHALL MAKE ITS RECORDS AVAILABLE, DURING NORMAL
BUSINESS HOURS, AFTER AT LEAST [***] ([***]) DAYS PRIOR WRITTEN NOTICE TO
SANOFI-AVENTIS, AS APPLICABLE, AND SHALL TAKE PLACE AT THE FACILITY(IES) WHERE
SUCH RECORDS ARE MAINTAINED.
EACH SUCH EXAMINATION SHALL BE LIMITED TO
PERTINENT BOOKS AND RECORDS FOR ANY YEAR ENDING NOT MORE THAN [***] ([***])
MONTHS PRIOR TO THE DATE OF REQUEST;PROVIDED, THAT, IMMUNOGEN SHALL NOT BE
PERMITTED TO AUDIT THE SAME PERIOD OF TIME MORE THAN ONCE.
BEFORE PERMITTING
SUCH INDEPENDENT ACCOUNTING FIRM TO HAVE ACCESS TO SUCH BOOKS AND RECORDS,
SANOFI-AVENTIS MAY REQUIRE SUCH INDEPENDENT ACCOUNTING FIRM AND ITS PERSONNEL
INVOLVED IN SUCH AUDIT, TO SIGN A CONFIDENTIALITY AGREEMENT (IN FORM AND
SUBSTANCE REASONABLY ACCEPTABLE TO EACH OF THE PARTIES) AS TO ANY CONFIDENTIAL
INFORMATION WHICH IS TO BE PROVIDED TO SUCH ACCOUNTING FIRM OR TO WHICH SUCH
ACCOUNTING FIRM WILL HAVE ACCESS, WHILE CONDUCTING THE AUDIT UNDER THIS
PARAGRAPH.
THE IMMUNOGEN INDEPENDENT ACCOUNTING FIRM WILL PREPARE AND PROVIDE
TO
14
EACH PARTY A WRITTEN REPORT STATING WHETHER THE ROYALTY REPORTS SUBMITTED