ACCESS SHALL BE
PERMITTED DURING SUPERGEN'S NORMAL BUSINESS HOURS DURING THE TERM OF THIS
AGREEMENT AND FOR THREE (3) YEARS AFTER THE EXPIRATION OR TERMINATION OF THIS
AGREEMENT.
ANY SUCH INSPECTION OR AUDIT SHALL BE AT LICENSOR'S EXPENSE,
EXCEPTING THAT IF THE AUDIT RESULTS SHOW UNDERPAYMENT BY SUPERGEN OF MORE THAN
FIFTEEN PERCENT (15%) OVER THE COURSE OF THE ENTIRE PERIOD AUDITED, THEN
SUPERGEN WILL PAY FOR REASONABLE AUDIT EXPENSES INCURRED BY LICENSEE.
3.10
ISSUANCE OF SUPERGEN STOCK.
EACH TIME SUPERGEN SHALL ISSUE SHARES
OF ITS COMMON STOCK IN LIEU OF CASH AS PROVIDED FOR IN THIS ARTICLE 3 ("LICENSEE
SHARES"), LICENSOR SHALL EXECUTE AND DELIVER TO SUPERGEN AN INVESTMENT
REPRESENTATION STATEMENT IN THE FORM ATTACHED HERETO AS EXHIBIT 2 PRIOR TO SUCH
ISSUANCE.
BROKERAGE FEES PAYABLE BY LICENSOR FOR SALE OF LICENSEE SHARES ISSUED
BY SUPERGEN UNDER THIS AGREEMENT SHALL BE PAID BY SUPERGEN, PROVIDED THAT
LICENSOR USES SUPERGEN'S RECOMMENDED BROKER FOR SUCH SALES.
THE LICENSEE SHARES
WILL BE PRICED AT A THIRTY (30) DAY RUNNING AVERAGE VALUE AS OF THE DATE WHEN A
MILESTONE IS ACHIEVED OR THE DATE WHEN A LICENSE OR MAINTENANCE FEE IS DUE.
[***]
ARTICLE 4
TERM AND TERMINATION
4.1
TERM.
THE TERM OF THIS AGREEMENT SHALL COMMENCE ON THE EFFECTIVE
DATE, AND UNLESS EARLIER TERMINATED AS PROVIDED HEREIN, SHALL CONTINUE IN FULL
FORCE AND EFFECT ON A COUNTRY-BY-COUNTRY AND LICENSED PRODUCT-BY-LICENSED
PRODUCT BASIS UNTIL THERE ARE NO REMAINING ROYALTY PAYMENT OBLIGATIONS IN A
COUNTRY PURSUANT TO SECTION 3.3, AT WHICH TIME THE AGREEMENT SHALL EXPIRE IN ITS
ENTIRETY IN SUCH COUNTRY.
NOTWITHSTANDING THE ABOVE, UPON THE EXPIRATION OF
THIS AGREEMENT IN ANY COUNTRY PURSUANT TO THIS SECTION 4.1, SUPERGEN SHALL HAVE
A NON-EXCLUSIVE, IRREVOCABLE, FULLY PAID-UP RIGHT AND LICENSE TO USE AND EXPLOIT
THE LICENSED PATENTS IN THAT COUNTRY.
4.2
TERMINATION FOR CAUSE.
IF EITHER PARTY MATERIALLY BREACHES THIS
AGREEMENT, THE NON-BREACHING PARTY MAY ELECT TO GIVE THE BREACHING PARTY WRITTEN
NOTICE DESCRIBING THE ALLEGED BREACH.
IF THE BREACHING PARTY HAS NOT CURED SUCH
BREACH WITHIN SIXTY (60) DAYS AFTER RECEIPT OF SUCH NOTICE, THE NOTIFYING PARTY
WILL BE ENTITLED, IN ADDITION TO ANY OTHER RIGHTS IT MAY HAVE UNDER THIS
AGREEMENT, TO TERMINATE THIS AGREEMENT EFFECTIVE IMMEDIATELY; PROVIDED, HOWEVER,
IF EITHER PARTY RECEIVES NOTIFICATION FROM THE OTHER OF A MATERIAL BREACH AND IF
THE PARTY ALLEGED TO BE IN BREACH
-7-
notifies the non-breaching party in writing within thirty (30) days of receipt
of default notice that it disputes the asserted default, the parties shall
discuss in good faith and attempt to resolve such dispute.
If the parties are
unable to resolve such dispute within thirty (30) days after notice of the
dispute is received by the non-breaching party, the matter will be submitted to
arbitration and no termination shall become effective prior to the completion of
such arbitration, and unless approved by the arbitrators.
4.3
PERMISSIVE TERMINATION.
SUPERGEN MAY TERMINATE THIS AGREEMENT
WITH RESPECT TO ANY COUNTRY AND/OR ANY ASPECT OF THE LICENSED PATENTS UPON
THIRTY (30) DAYS WRITTEN NOTICE