PROGRAM.
3.4
RECORDS.
3.4.1
RECORD KEEPING.
(A)
RESEARCH PROGRAM RECORDS.
EACH PARTY SHALL
MAINTAIN COMPLETE AND ACCURATE RECORDS OF ITS ACTIVITIES IN THE RESEARCH PROGRAM
IN SUFFICIENT DETAIL, IN GOOD SCIENTIFIC MANNER AND OTHERWISE IN A MANNER THAT
REFLECTS ALL WORK DONE AND RESULTS ACHIEVED.
SUBJECT TO ARTICLE 6, EACH PARTY
SHALL PROVIDE THE OTHER PARTY WITH ACCESS DURING NORMAL BUSINESS HOURS AND UPON
REASONABLE ADVANCE NOTICE TO REVIEW SUCH RECORDS TO THE EXTENT REASONABLY
REQUIRED FOR SUCH OTHER PARTY'S PERFORMANCE OF ITS OBLIGATIONS UNDER THIS
AGREEMENT; PROVIDED, THAT, THE NON-REVIEWING PARTY MAY REDACT INFORMATION NOT
RELEVANT TO THE RESEARCH PROGRAM PRIOR TO SUCH REVIEW.
(B)
RECORD KEEPING POLICIES.
WITHOUT LIMITING
THE GENERALITY OF SECTION 3.4.1(A), EACH PARTY AGREES TO MAINTAIN A POLICY THAT
REQUIRES ITS EMPLOYEES AND CONSULTANTS TO RECORD AND MAINTAIN ALL DATA AND
INFORMATION DEVELOPED DURING THE RESEARCH PROGRAM.
3.4.2
REPORTS.
EACH PARTY SHALL KEEP THE JRC
REGULARLY INFORMED OF THE PROGRESS OF THE RESEARCH PROGRAM.
WITHOUT LIMITING
THE GENERALITY OF THE FOREGOING, EACH PARTY SHALL, AT LEAST ONCE EACH CALENDAR
QUARTER DURING THE RESEARCH COLLABORATION PERIOD, (A) PROVIDE REPORTS TO THE JRC
IN REASONABLE DETAIL REGARDING THE STATUS OF ITS ACTIVITIES UNDER THE RESEARCH
33
PROGRAM, (B) ADVISE THE JRC OF ITS IDENTIFICATION OF COLLABORATION COMPOUNDS
PURSUANT TO SECTION 3.6 AND PROVIDE THE JRC WITH ANY SUPPORTING DATA APPLICABLE
TO SUCH COLLABORATION COMPOUNDS, (C) PROVIDE THE JRC WITH THE RESULTS OF
ACTIVITIES CONDUCTED IN THE RESEARCH PROGRAM WITH RESPECT TO EACH COLLABORATION
COMPOUND SO AS TO ENABLE THE JRC TO DETERMINE WHETHER SUCH COLLABORATION
COMPOUND MEETS THE ADVANCEMENT CRITERIA AND SHOULD BE ADVANCED BY THE JRC TO THE
NEXT RESEARCH STAGE, (D) PROVIDE THE JRC WITH THE RESULTS OF THE TOXICOLOGY
STUDIES WITH RESPECT TO EACH PRIMARY DEVELOPMENT COMPOUND OR BACKUP COMPOUND SO
AS TO ENABLE DS TO DETERMINE WHETHER TO EXERCISE THE DS OPTION APPLICABLE
THERETO (SUCH NOTICE, THE "TOXICOLOGY STUDIES RESULTS"), (E) PROVIDE THE JRC
WITH SUCH ADDITIONAL INFORMATION THAT IT HAS IN ITS POSSESSION AS MAY BE
REASONABLY REQUESTED FROM TIME TO TIME BY THE JRC, AND (F) PROVIDE THE JRC, ON
OR BEFORE * (*) DAYS FROM THE TERMINATION OR EXPIRATION OF THE RESEARCH
COLLABORATION PERIOD, WITH A FINAL REPORT REGARDING ALL ARQULE RESEARCH
ACTIVITIES AND DS RESEARCH ACTIVITIES CONDUCTED BY ARQULE AND DS, RESPECTIVELY,
DURING THE RESEARCH COLLABORATION PERIOD TO THE EXTENT NOT PREVIOUSLY INCLUDED
IN THE REPORTS DESCRIBED ABOVE.
3.5
SELECTION OF DS TARGETS.
3.5.1
INITIAL DS TARGETS.
THE PARTIES HEREBY
ACKNOWLEDGE AND AGREE THAT * (*) TARGETS HAVE BEEN DESIGNATED BY THE PARTIES AS
DS TARGETS AS OF THE EFFECTIVE DATE AND ARE INCLUDED ON THE DS TARGET LIST (THE
"INITIAL DS TARGETS").
3.5.2
SUBSTITUTION OF DS TARGETS.
(A)
DISCONTINUATION AND REPLACEMENT OF DS
TARGETS.
IF, AT ANY TIME DURING THE RESEARCH COLLABORATION PERIOD, DS
DETERMINES THAT IT WISHES TO DISCONTINUE FURTHER RESEARCH WITH RESPECT TO A DS
TARGET (I) DS SHALL PROVIDE WRITTEN NOTICE OF SUCH DETERMINATION TO ARQULE AND
THE JRC, WHICH NOTICE SHALL IDENTIFY THE