Common use of Price Review and Audit Procedure Clause in Contracts

Price Review and Audit Procedure. (a) Manufacturer shall maintain complete and accurate Records that fairly reflect the relevant costs and calculations used to determine the Price of each Product and shall retain such Records for a period of not less than three (3) years after the applicable Product was manufactured and delivered hereunder. With respect to a Price change under Section 3.2 for any Product in an upcoming Fiscal Year, if Customer requests such a review in writing within thirty (30) days following notice to Customer of such change, then: (i) the Parties shall reasonably discuss and attempt to resolve any disagreement with respect thereto and (ii) if such disagreement is not resolved within thirty (30) days following commencement of such discussions, Customer shall have the right, no more than one (1) time per Fiscal Year each for the subject of (1) and (2) below and on no less than thirty (30) days’ notice to Manufacturer, to appoint a reputable and internationally recognized independent Third-Party audit firm reasonably acceptable to Manufacturer (and which agrees to be bound by Manufacturer’s customary confidentiality agreement) to audit such relevant Records, during normal business hours and on a confidential basis, to verify that, either (1) the change in the relevant Products’ Price for an applicable Facility for the upcoming Fiscal Year, as applicable, or (2) the true-up determination with respect to (x) the estimated and actual Facility Conversion Costs of a Facility with respect to any Fiscal Year or (y) the Facility Estimated Product Materials Cost and the Facility Actual Product Materials Cost with respect to any Fiscal Year, was accurately and equitably calculated by Manufacturer in accordance with this Agreement; provided that Customer shall be deemed to have waived its right for such a review if Customer does not make such request within thirty (30) days following delivery of Manufacturer’s notice to Customer of such increase. For the avoidance of doubt, any such audit initiated by Customer in accordance with clause (ii) above shall include in the scope of audit all of the Products manufactured at the applicable Facility, and not be limited in scope to the discrete Product(s) in question. Subject to Section 3.4(b)(2), Customer shall bear all costs and expenses of conducting such an audit, and such accounting firm shall work on an hourly or flat fee basis without a contingency fee or other performance or bonus fee. Such accounting firm shall, as promptly as practicable, provide in writing (I) a detailed report of such audit to Manufacturer and (II) a separate report limited to the Price for the subject Products in the relevant Fiscal Year as calculated by such accounting firm in accordance with this Agreement to Manufacturer and Customer. The Price for the Products during a Fiscal Year, as calculated by such accounting firm, absent any manifest error, shall be binding upon the Parties with respect to such increase or required payment, as applicable; provided that, within fifteen (15) days of receipt of the audit report, Manufacturer shall have the right to dispute such Price or calculation thereof by submitting written notice to Customer and the accounting firm accompanied by information supporting Manufacturer’s position. Within thirty (30) days of receipt of Manufacturer’s notice of dispute, the accounting firm shall issue its final findings with respect to the Price for the relevant Product in the relevant Fiscal Year and such decision, absent manifest error, shall be binding upon the Parties.

Price Review and Audit Procedure. (a) Manufacturer shall maintain complete and accurate Records books and records that fairly reflect the relevant costs and calculations used to determine the Price Standard Costs of each Product and shall retain such Records books and records for a period of not less than three two (32) years after the applicable Product was manufactured and delivered hereunder. With respect to a Price change any Standard Cost increase under Section 3.2 for any Product or required payment under Section 3.3 that in an upcoming Fiscal Yeareach case is subject to review under this Section 3.4, if Customer requests such a review in writing within thirty (30) days following notice to Customer of such change, then: increase or payment (as applicable): (i) the Parties shall reasonably discuss and attempt to resolve any disagreement with respect thereto thereto, and (ii) if such disagreement is not resolved within thirty (30) days following commencement of such discussions, Customer shall have the right, no more than one (1) time per Fiscal Year each for the subject of (1) and (2) below and on no less than thirty (30) days’ notice to Manufacturer, to appoint a reputable and internationally recognized independent Third-Party audit accounting firm reasonably acceptable to Manufacturer (and which agrees to be bound by Manufacturer’s customary confidentiality agreement) to audit such relevant Recordsbooks and records, during normal business hours and on a confidential basis, to verify thatthat the (i) with respect to Section 3.3, either Volume Variance and/or Purchase Price Variance, as applicable, during the preceding Financial Year or (1ii) the with respect to Section 3.2, budgeted change in the relevant Products’ Price for an applicable Facility Standard Cost for the upcoming Fiscal coming Financial Year, as applicable, or (2) the true-up determination with respect to (x) the estimated and actual Facility Conversion Costs of a Facility with respect to any Fiscal Year or (y) the Facility Estimated Product Materials Cost and the Facility Actual Product Materials Cost with respect to any Fiscal Year, was accurately and equitably calculated by Manufacturer in accordance with this Agreement; provided that Customer shall be deemed to have waived its right for such a review if Customer does not make such request within thirty (30) days following delivery of Manufacturer’s notice to Customer of such increaseArticle 3. For the avoidance of doubt, any such audit initiated by Customer in accordance with clause (ii) above shall include in the scope of audit all of the Products manufactured at the applicable Facility, and not be limited in scope to the discrete Product(s) in question. Subject to Section 3.4(b)(2), Customer shall bear all costs and expenses of conducting such an audit, and such accounting firm shall work on an hourly or flat fee basis without a contingency fee or other performance or bonus fee. Such accounting firm shall, as promptly as practicable, shall provide in writing (Ii) a detailed report of such audit to Manufacturer and (IIii) a separate report limited to the Price for the subject Products in the relevant Fiscal Year applicable Standard Cost(s) as calculated by such accounting firm in accordance with this Agreement Article 3 to Manufacturer and CustomerCustomer (provided that, for clarity, the Standard Cost methodology shall not be subject to audit). The Price for the Products during a Fiscal Year, Standard Cost(s) as calculated by such accounting firm, firm absent any manifest error, error shall be binding upon the Parties with respect to such increase or required payment, as applicable; provided that. Notwithstanding anything to the contrary in this Agreement, within fifteen (15) days of receipt of the audit report, Manufacturer Customer shall have the no right to dispute such or request review of any Price or calculation thereof by submitting written notice to Customer and the accounting firm accompanied by information supporting Manufacturer’s position. Within thirty (30) days of receipt of Manufacturer’s notice of disputeor change thereto, the accounting firm shall issue its final findings with respect to the Price for the relevant Product except as provided in the relevant Fiscal Year and such decision, absent manifest error, shall be binding upon the Partiesthis Section 3.4.