WHICH NOTICE SHALL INCLUDE THE AMOUNT OF SUCH OTHER THIRD PARTY PRODUCT
PAYMENT AND (B) THIS AGREEMENT SHALL, WITHOUT ANY FURTHER ACTION BY EITHER
PARTY, BE DEEMED TO HAVE BEEN MODIFIED AS
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company's application requesting
confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934,
as amended.
9
OF SUCH DATE BY SUBSTITUTING THE AMOUNT OF THE APPLICABLE PRODUCT PAYMENT IN
EFFECT AS OF SUCH DATE UNDER SECTION 4.1.1 BY THE THIRD PARTY PRODUCT PAYMENT;
PROVIDED, THAT, THE PARTIES SHALL IN GOOD FAITH EXECUTE AN AMENDMENT TO THIS
AGREEMENT REFLECTING THE FOREGOING CHANGE EFFECTIVE AS OF THE DATE OF SUCH FIRST
COMMERCIAL SALE.
4.1.3
PAYMENT DATES AND REPORTS.
ALL PRODUCT PAYMENTS
SHALL BE MADE BY ORAL DNA WITHIN THIRTY (30) DAYS AFTER THE END OF EACH CALENDAR
QUARTER COMMENCING WITH THE CALENDAR QUARTER IN WHICH THE FIRST COMMERCIAL SALE
OF A LICENSED PRODUCT OCCURS BASED UPON THE AGGREGATE LICENSED PRODUCTS THAT ARE
SOLD DURING SUCH CALENDAR QUARTER.
ALL PAYMENTS SHALL BE MADE BY WIRE TRANSFER
IN ACCORDANCE WITH INSTRUCTIONS GIVEN TO ORAL DNA IN WRITING FROM TIME TO TIME
BY ILI.
ORAL DNA SHALL ALSO PROVIDE, AT THE SAME TIME EACH SUCH PAYMENT IS
MADE, A REPORT FOR SUCH CALENDAR QUARTER SHOWING:
(A) THE AGGREGATE VOLUME OF
SALES, BY STATE, OF LICENSED PRODUCTS IN THE TERRITORY; AND (B) A CALCULATION OF
THE AGGREGATE AMOUNT OF PRODUCT PAYMENTS DUE TO ILI.
4.1.4
RECORDS; AUDIT RIGHTS.
ORAL DNA 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
PRODUCT PAYMENTS DUE TO ILI.
ILI SHALL HAVE THE RIGHT TO ENGAGE AN INDEPENDENT
CERTIFIED PUBLIC ACCOUNTING FIRM REASONABLY ACCEPTABLE TO ORAL DNA, WHICH SHALL
HAVE THE RIGHT TO AUDIT THE RELEVANT BOOKS AND RECORDS OF ORAL DNA AS MAY BE
REASONABLY NECESSARY TO DETERMINE AND/OR VERIFY THE AMOUNT OF PRODUCT PAYMENTS
DUE HEREUNDER.
SUCH EXAMINATION SHALL BE CONDUCTED, AND ORAL DNA SHALL MAKE ITS
RECORDS AVAILABLE, DURING NORMAL BUSINESS HOURS UPON AT LEAST FIFTEEN (15) DAYS
PRIOR WRITTEN NOTICE, WHICH SHALL TAKE PLACE AT THE FACILITY(IES) WHERE SUCH
RECORDS ARE MAINTAINED.
SUCH AUDIT RIGHTS SHALL NOT BE EXERCISED BY ILI MORE
THAN ONCE PER CALENDAR YEAR.
EACH SUCH AUDIT SHALL BE LIMITED TO PERTINENT
BOOKS AND RECORDS FOR ANY YEAR ENDING NOT MORE THAN THIRTY SIX (36) MONTHS PRIOR
TO THE DATE OF REQUEST; PROVIDED, THAT, ILI SHALL NOT BE PERMITTED TO AUDIT THE
SAME PERIOD OF TIME MORE THAN ONCE.
THE INDEPENDENT ACCOUNTING FIRM WILL
PREPARE AND PROVIDE TO EACH PARTY A WRITTEN REPORT STATING WHETHER THE REPORTS
SUBMITTED AND PRODUCT PAYMENTS PAID ARE CORRECT OR INCORRECT AND THE SPECIFIC
DETAILS CONCERNING ANY DISCREPANCIES AND MAY NOT REVEAL TO ILI ANY