Common use of Regulatory Audit Clause in Contracts

Regulatory Audit. Purchaser (inclusive of its employees and representatives) shall have the right to audit Seller’s facilities, as Purchaser deems necessary. Seller shall also cooperate with regulatory agency requests to audit Seller’s facility, provided, Purchaser shall not be entitled to be present during any regulatory agency inspection. However, exercise of such right shall be subject to the following conditions: (a) Purchaser or its representatives, as the case may be, must sign Seller’s standard confidentiality agreement (“Confidentiality Agreement”); (b) Purchaser shall be entitled to conduct only one audit per Contract Year unless additional audits are required by law or regulation or otherwise agreed or unless Purchaser can demonstrate that Seller has materially breached this Agreement; (c) Purchaser audits shall be conducted only after reasonable advance written notice of the audit is provided by Purchaser to Seller and then only at such time as is reasonably convenient to Seller; (d) all information gathered and data reviewed during any such audit shall be “Confidential Information” subject to the provisions of the Confidentiality Agreement; and (e) the scope of each such audit shall be limited to the production and delivery (copies of which shall not be removed from Seller’s premises) of the Products under this Agreement and all documentation, data, and other records relating solely thereto, including but not limited to, production standard operating procedures that are not proprietary (e.g., QC, testing, training, etc.), and records and data relating to raw materials. Seller shall cooperate with Purchaser in the performance of such audit. [***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.