Common use of Breach Audit Clause in Contracts

Breach Audit. If Licensee has a reasonable belief of unfair treatment by Tessera or any successor thereof that Tessera is either not complying with the Most Favored Customer provision, as set forth in Paragraph III.E., or is transferring substantial Technical Information to other Tessera licensees (for the same Technology rights licensed to both Licensee and such other Tessera licensees) which Tessera is not or has not transferred or otherwise made available to Licensee, Licensee shall consult with Tessera and discuss such possible unbalanced sharing of Technical Information or possible non-compliance with the Most Favored Customer provision. After such discussion, if Licensee is unsatisfied that it has received all materially important Technical Information or has not received royalty rates consistent with the Most Favored Customer provision, Licensee shall have a right to an audit performed no more than once every two (2) years to determine whether such unbalanced transfer of Technical Information or such violation of the Most Favored Customer provision is occurring. The audit shall be conducted by a third party independent auditor mutually agreed upon by the parties prior to the audit. In the event that the third party auditor determines that Licensee has not (1) received the material Technical Information transferred to a similarly situated other licensee of Tessera (taking into account variations in the Technical Information due to licensee requested data formats, mixtures of Tessera and other licensee confidential information, time or test changed data, etc.) or (2) received royalty rates consistent with the Most Favored Customer provision, the auditor shall issue an opinion of what material information is in need of transfer to Licensee or what royalty adjustments are to be made. Licensee shall then have the right to demand and receive the transfer of such untransferred Technical Information within the auditor’s report or adjustment to the royalty rate. Compliance and dispute resolution issues under this Paragraph XI.B. shall be determined as set forth in Paragraph XVI.B.

Breach Audit. If Licensee has a reasonable belief of unfair treatment by Tessera or any successor thereof that Tessera is either not complying with the Most Favored Customer provision, as set forth in Paragraph III.E., or is transferring substantial Technical Information to other Tessera licensees (for the same Technology rights licensed to both Licensee and such other Tessera licensees) which Tessera is not or has not transferred or otherwise made available to Licensee, Licensee shall consult with Tessera and discuss such possible unbalanced sharing of Technical Information or possible non-compliance with the Most Favored Customer provision. After such discussion, if Licensee is unsatisfied that it has received all materially important Technical Information or has not received royalty rates consistent with the Most Favored Customer provision, Licensee shall have a right to an audit performed no more than once every two (2) years to determine whether such unbalanced transfer of Technical Information or such violation of the Most Favored Customer provision is occurring. The audit shall be conducted by a third party independent auditor mutually agreed upon by the parties prior to the audit. In the event that the third party auditor determines that Licensee has not (1) received the material Technical Information transferred to a similarly situated other licensee of Tessera (taking into account variations in the Technical Information due to licensee requested data formats, mixtures of Tessera and other licensee confidential information, time or test changed data, etc.) or (2) received royalty rates consistent with the Most Favored Customer provision, the auditor shall issue an opinion of what material information is in need of transfer to Licensee or what royalty adjustments are to be made. Licensee shall then have the right to demand and receive the transfer of such untransferred Technical Information within the auditor’s 's report or adjustment to the royalty rate. Compliance and dispute resolution issues under this Paragraph XI.B. shall be determined as set forth in Paragraph XVI.B.