Common use of Initial Audit Clause in Contracts

Initial Audit. Beginning within sixty (60) days after the Effective Date, ▇▇▇▇ and ▇▇▇▇ Affiliates shall permit the Independent Accountant, which as of the Effective Date is PriceWaterhouse Coopers LLP, to have access during normal business hours, at ▇▇▇▇ and any ▇▇▇▇ Affiliate’s premises, to such of the records of ▇▇▇▇ and ▇▇▇▇ Affiliates as may be reasonably necessary to verify the accuracy of the infringement fee payment set forth in Section 4(a)(i) and applicable interest in Section 4(a)(ii) (the “Initial Audit”), and ▇▇▇▇ shall be responsible for any under-payment of the amount owed Palomar under this Section 4(a) notwithstanding the terms of this TDS Agreement or the Settlement Agreement (including any release thereunder). The Parties acknowledge and agree that ▇▇▇▇ shall be required to pay any initial under-payment under this Section 4(a) (the “Past Infringement Under-Payment”) in full, plus interest at a rate equal to the lesser of one and one-half percent (1.5%) per month or the highest rate permitted by applicable law (calculated on a compound basis with a monthly compounding period from the date in the middle of the month in which the Sale was made until the date payment is made, or if any portion of the Past Infringement Under-Payment cannot reasonably be related to any such Sale so as to determine the start date for such interest calculation, then from January 1, 2006 for such portion) (the “Higher Rate”), and not the Applicable Rate, and failure by ▇▇▇▇ to pay the Past Infringement Under-Payment, plus such interest at the Higher Rate, in full within forty-five (45) days following notice thereof shall constitute a material breach of this TDS Agreement by ▇▇▇▇. For clarity, only one rate of interest shall apply to any Sale of the Harmony System or Aria System, or any portion of Fee-Bearing Net Sales, not initially reported by ▇▇▇▇ that gives rise to or results in the Past Infringement Under-Payment, which rate of interest shall be equal to the Higher Rate as determined above and not the Applicable Rate. The fees and expenses charged by such Independent Accountant for the Initial Audit shall be paid by ▇▇▇▇.

Initial Audit. Beginning within sixty (60) days after the Effective Date, ▇A▇▇▇ and ▇A▇▇▇ Affiliates shall permit the Independent Accountant, which as of the Effective Date is PriceWaterhouse Coopers LLP, to have access during normal business hours, at ▇A▇▇▇ and any ▇A▇▇▇ Affiliate’s premises, to such of the records of ▇A▇▇▇ and ▇A▇▇▇ Affiliates as may be reasonably necessary to verify the accuracy of the infringement fee payment set forth in Section 4(a)(i) and applicable interest in Section 4(a)(ii) (the “Initial Audit”), and ▇A▇▇▇ shall be responsible for any under-payment of the amount owed Palomar under this Section 4(a) notwithstanding the terms of this TDS Agreement or the Settlement Agreement (including any release thereunder). The Parties acknowledge and agree that ▇A▇▇▇ shall be required to pay any initial under-payment under this Section 4(a) (the “Past Infringement Under-Payment”) in full, plus interest at a rate equal to the lesser of one and one-half percent (1.5%) per month or the highest rate permitted by applicable law (calculated on a compound basis with a monthly compounding period from the date in the middle of the month in which the Sale was made until the date payment is made, or if any portion of the Past Infringement Under-Payment cannot reasonably be related to any such Sale so as to determine the start date for such interest calculation, then from January 1, 2006 for such portion) (the “Higher Rate”), and not the Applicable Rate, and failure by ▇A▇▇▇ to pay the Past Infringement Under-Payment, plus such interest at the Higher Rate, in full within forty-five (45) days following notice thereof shall constitute a material breach of this TDS Agreement by ▇A▇▇▇. For clarity, only one rate of interest shall apply to any Sale of the Harmony System or Aria System, or any portion of Fee-Bearing Net Sales, not initially reported by ▇A▇▇▇ that gives rise to or results in the Past Infringement Under-Payment, which rate of interest shall be equal to the Higher Rate as determined above and not the Applicable Rate. The fees and expenses charged by such Independent Accountant for the Initial Audit shall be paid by ▇A▇▇▇.