Payment General. 5.1 Salix shall prepare a statement in respect of each Quarter which shall show in reasonable detail for the Quarter in question the calculation of Royalties due to ▇▇▇▇ with respect to aggregate Net Sales. Such statement shall specify in reasonable detail the calculation of Net Sales (in accordance with the definition set out in Clause 1) in respect of each Product and the applicable Royalties due to ▇▇▇▇ and such other information relating to the calculation of Net Sales as ▇▇▇▇ may reasonably request from time to time. Such statement shall be submitted to ▇▇▇▇ within ninety (90) days of the end of the Quarter to which it relates together with remittance for Royalties due to ▇▇▇▇ in respect of each Product under Clauses 3.1.8, 3.1.9 and 3.1.10 (as applicable). 5.2 Salix, its Affiliates and Sublicensees shall keep complete, true and accurate books of account and records for the purpose or determining the amounts payable or accountable hereunder. Such books and records shall be kept at one of the principal places of Salix, its Affiliates and Sublicensees for a least seven (7) years following the end of the calendar quarter to which they pertain. ▇▇▇▇ shall have the following audit rights: 5.2.1 Upon the written request of ▇▇▇▇ and, except with respect to an audit permitted by Clause 5.2.2, not more than once in each Year, Salix shall permit an independent certified public accounting firm of recognized good standing in the US, selected by ▇▇▇▇, at ▇▇▇▇’▇ expense, to have access during normal business hours, and upon reasonable prior written notice, to such of the records of Salix as may be reasonably necessary to verify the accuracy of the calculations of Royalties and other amounts due and payable under this Agreement for any Year ending, except as otherwise permitted under Clause 5.2.2, not more than [*] Years prior to the date of such request. If such accounting firm concludes, as indicated by a written report delivered to each of the Parties, that additional Royalties or other amounts were owed during such period, Salix shall pay the additional Royalties or other amounts, as applicable, with interest from the date originally due at the rate specified in Clause 5.3 within sixty (60) days after the date on which such accounting firm’s written report is delivered to Salix. Any overpayment of Royalties shall be fully creditable against future royalties payable to ▇▇▇▇. 5.2.2 If, and only if, the amount of any underpayment discovered as the result of an audit conducted in accordance with Clause 5.2.1 is greater than [*] percent ([*]%) of the total amount previously paid, then Salix shall reimburse ▇▇▇▇ for all costs related to such audit and ▇▇▇▇ shall be entitled to conduct an audit in accordance with Clause 5.2.1 for any Year ending not more than [*] years prior to the date of such audit; provided, that in no event shall ▇▇▇▇ audit Salix more than twice in any Year. 5.3 Without prejudice to ▇▇▇▇’▇ rights under Clause 17.7 if any Royalty or any other amount due and payable under this Agreement is overdue, Salix shall pay interest thereon at an annual rate (but with interest accruing on a daily basis) of [*] percent ([*]%) above the then-current U.S. prime rate, as published in The Wall Street Journal, Eastern U.S. Edition. Such interest shall run from the date upon which payment of such sum became due until payment thereof in full together with such interest by Salix. 5.4 All sums due to ▇▇▇▇ under this Agreement:- 5.4.1 are, unless otherwise expressly stated, exclusive of any Value Added Tax or equivalent sales tax which shall be payable (if applicable) on submission by ▇▇▇▇ of valid Value Added Tax invoices in respect thereof; and [*] Confidential treatment requested; certain information omitted and filed separately with the SEC. 5.4.2 shall be paid in full subject to deduction for withholding taxes, charges and other duties that may be imposed in the Territory save insofar as ▇▇▇▇ shall be capable of obtaining a credit therefor. The Parties agree to co-operate in all respects necessary to take advantage of such double taxation agreements as may be available. If Salix is required to deduct or withhold it will (i) promptly notify ▇▇▇▇ of such requirement, (ii) pay to the relevant authorities the full amount to be deducted or withheld promptly upon the earlier of determining that such deduction or withholding is required or receiving notice that such amount has been assessed against ▇▇▇▇ and (iii) promptly forward to ▇▇▇▇ an official receipt (or certified copy), or other documentation reasonably acceptable to ▇▇▇▇ and obtainable by Salix, evidencing such payments to such authorities. 5.5 All Royalties or other sums payable under this Agreement shall be paid in US dollars by telegraphic transfer to such bank as ▇▇▇▇ may designate for such purpose.
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Payment General. 5.1 Salix ▇▇▇▇ shall prepare a statement (“Statement”) in respect of each Quarter which shall show in reasonable detail for the Quarter in question the calculation of Royalties due to ▇▇▇▇ Salix with respect to aggregate Net Sales. Such statement Statement shall specify in reasonable detail the calculation of Net Sales (in accordance with the definition set out in Clause 1) in respect of each Product and the applicable Royalties due to ▇▇▇▇ Salix and such other information relating to the calculation of Net Sales as ▇▇▇▇ Salix may reasonably request from time to time. Such statement Statement shall be submitted to ▇▇▇▇ Salix within ninety (90) days of the end of the Quarter to which it relates together with remittance for Royalties due to Salix under Clause 3.1.3 (as applicable). Promptly, on receipt of each such Statement, Salix shall issue an invoice in respect of the payments made with such Statement.
5.2 In respect of the first Quarter in each Year in which aggregate Net Sales for the relevant Year shall exceed €[*] ([*] euros) ▇▇▇▇ shall in respect of each Product the Statement for such Quarter:
5.2.1 account for Royalties on Net Sales in such Quarter and thereafter in such Year at the higher rate due under Clauses 3.1.8, 3.1.9 Clause 3.1.3(b); and
5.2.2 specify the additional Royalty due under Clause 3.1.3(b) for all Net Sales in the Year to date on which Royalty shall have been paid under Clause 3.1.3(a) and 3.1.10 (as applicable)shall remit all such additional Royalties due to Salix with such Statement.
5.2 Salix5.3 ▇▇▇▇, its Affiliates and Sublicensees shall keep complete, true and accurate books of account and records for the purpose or determining the amounts payable or accountable hereunder. Such books and records shall be kept at one of the principal places of Salixbusiness of ▇▇▇▇, its Affiliates and Sublicensees for a at least seven (7) years following the end of the calendar quarter Quarter to which they pertain. ▇▇▇▇ Salix shall have the following audit rights:
5.2.1 5.3.1 Upon the written request of ▇▇▇▇ Salix and, except with respect to an audit permitted by Clause 5.2.25.3.2, not more than once in each Year, Salix ▇▇▇▇ shall permit an independent certified public accounting firm of recognized good standing in the USEurope, selected by ▇▇▇▇Salix, at ▇▇▇▇’▇ Salix’s expense, to have access during normal business hours, and upon reasonable prior written notice, to such of the records of Salix ▇▇▇▇ as may be reasonably necessary to verify the accuracy of the calculations of Royalties royalties and other amounts due and payable under this Agreement for any Year ending, except as otherwise permitted under Clause 5.2.25.3.2, not more than [*] Years prior to the date of such request. If such accounting firm concludes, as indicated by a written report delivered to each of the Parties, that additional Royalties or other amounts were owed during such period, Salix ▇▇▇▇ shall pay the additional Royalties or other amounts, as applicable, with interest from the date originally due at the rate specified in Clause 5.3 5.4 within sixty (60) days after the date on which such accounting firm’s written report is delivered to Salix. Any overpayment of Royalties shall be fully creditable against future royalties payable to ▇▇▇▇Salix.
5.2.2 5.3.2 If, and only if, the amount of any underpayment discovered as the result of an audit conducted in accordance with Clause 5.2.1 5.3.1 is greater than [*] percent ([*]%) of the total amount previously paid, then Salix shall reimburse ▇▇▇▇ shall reimburse Salix for all costs related to such audit and ▇▇▇▇ Salix shall be entitled to conduct an audit in accordance with Clause 5.2.1 5.3.1 for any Year ending not more than [*] years prior to the date of such audit; provided, provided that in no event shall Salix audit ▇▇▇▇ audit Salix more than twice in any Year.
5.3 5.4 Without prejudice to ▇▇▇▇’▇ Salix’s rights under Clause 17.7 18.3 if any Royalty or any other amount due and payable under this Agreement is overdue, Salix ▇▇▇▇ shall pay interest thereon at an annual rate (but with interest accruing on a daily basis) of [*] percent ([*]%) above the then-current U.S. prime rate, as published in The Wall Street Journal, Eastern U.S. Edition. Such interest shall run from the date upon on which payment of such sum became due until payment thereof in full together with such interest by Salix▇▇▇▇. [*] Confidential treatment requested; certain information omitted and filed separately with the SEC.
5.4 5.5 All sums due to ▇▇▇▇ Salix under this Agreement:-Agreement:
5.4.1 5.5.1 are, unless otherwise expressly stated, exclusive of any Value Added Tax or equivalent sales tax which shall be payable (if applicable) on submission by ▇▇▇▇ Salix of valid Value Added Tax invoices in respect thereof; and [*] Confidential treatment requested; certain information omitted and filed separately with the SEC.and
5.4.2 5.5.2 shall be paid in full subject to deduction for withholding taxes, charges and other duties that may be imposed in the Territory save insofar as ▇▇▇▇ Salix shall be capable of obtaining a credit therefor. The Parties agree to co-operate in all respects necessary to take advantage of such double taxation agreements as may be available. If Salix ▇▇▇▇ is required to deduct or withhold it will (i) promptly notify ▇▇▇▇ Salix of such requirement, (ii) pay to the relevant authorities the full amount to be deducted or withheld promptly upon the earlier of determining that such deduction or withholding is required or receiving notice that such amount has been assessed against ▇▇▇▇ Salix, and (iii) promptly forward to ▇▇▇▇ Salix an official receipt (or certified copy), ) or other documentation reasonably acceptable to Salix and obtainable by ▇▇▇▇ and obtainable by Salix▇, evidencing such payments to such authorities.
5.5 5.6 All Royalties or other sums payable under this Agreement shall be paid in US dollars Dollars by telegraphic transfer to such bank as ▇▇▇▇ Salix may designate for such purpose. For the purposes of calculating:
5.6.1 the threshold on Net Sales under Clause 3.1.3, all Net Sales effected in currency other than Euros shall be converted into Euros at the Exchange Rate at the end of the relevant Quarter;
5.6.2 payments due in US Dollars in respect of Royalties, the sum calculated as due shall be converted into US Dollars at the Exchange Rate three Business Days before the due date for payment.
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