“Retained Amount” means ten percent (10%) of the Total Work Phase Budget being the amount of the Total Work Phase Budget which is retained by FUNDER until all the conditions set out at Clause 3.10 have been met.
“Work Phase Budget” means the maximum amount of funding to be provided by FUNDER to the Partner for the relevant Work Phase, as set out in the Work Phase Statement.
“Work Phase Statement” means the final statement of activities, timeline, Partner contribution, milestones and budget for the relevant Work Phase agreed pursuant to Clause 3.5 using the template at Schedule 1 and in the case of the Pre-Clinical Work Phase, attached at Schedule 5.
3. Contributions and Work Phases
3.2. Partner Obligations. The Partner shall: […]
3.2.3 in each case, use each Work Phase Budget solely for the purposes described in the relevant Work Phase Statement unless otherwise agreed in writing by FUNDER in advance.
3.5 Agreeing Work Phase Statements. Each Work Phase Statement shall be agreed in the following manner:
3.5.1. For the Pre-clinical Work Phase, the Work Phase Statement agreed to by the Parties is attached at Schedule 5.
3.5.2. Except where Clause 3.5.1 applies, six (6) months prior to the completion of any individual Work Phase, the Partner shall provide to FUNDER such information as the FUNDER Group may reasonably request about the next planned Work Phase and FUNDER reserves the right to conduct a formal stage-gate review that shall include a face-to-face meeting with the Partner and/or otherwise request further information prior to the exercise of FUNDER’s option to fund any subsequent Work Phase Partner agrees to participate in any face-to-face stage-gate review and to provide such requested information in a timely fashion, so as to avoid disruption between Work Phases;
3.5.3. Following FUNDER’s receipt of the information from the Partner, FUNDER shall, as soon as reasonably practicable, inform the Partner that:
i. it is willing in principle to provide funding for the next planned Work Phase; or
ii. it declines to provide funding for the next planned Work Phase.
3.5.4. If Clause 3.5.3i applies, FUNDER shall provide the Partner with the draft Work Phase Statement and the Parties shall discuss such draft in good faith. An indication in principle that FUNDER is willing to provide funding for the planned Work Phase is not an exercise of FUNDER’s option to do so, exercise only occurs when the Work Phase Statement has been agreed and both Parties have signed it. The Parties shall work together in good faith and in a timely manner to ensure smooth transition between Work Phases.
3.6 Payments. FUNDER shall pay the first tranche of the Work Phase Budget as defined in any Work Phase to the Partner within twenty (20) Business Days after the later of receipt of invoice and the date of signature of the Work Phase Statement, unless otherwise provided for in the relevant Work Phase Statement.
3.7 Milestone Reports. The Partner shall promptly notify FUNDER when the Partner considers that a Milestone within any Work Phase has been achieved, and it shall, as soon as reasonably practicable send to FUNDER:
3.7.1. a detailed report evidencing such achievement (the “Milestone Report”); and
3.7.2. up to date, true, complete and accurate Financial Documents.
3.8. FUNDER Evaluation of Milestones. Within twenty (20) Business Days after receipt of a Milestone Report and the Financial Documents, FUNDER shall confirm to the Partner whether:
3.8.1. the Milestone has been achieved by the Milestone Date to FUNDER’s reasonable satisfaction, and that it has no objections to the Partner’s Financial Documents. In this case, FUNDER shall pay the next tranche of the FUNDER Funding (as defined in the relevant Work Phase Statement) to the Partner within twenty (20) Business Days after FUNDER’s confirmation pursuant to this Clause;
3.8.2. FUNDER (acting reasonably) disagrees with the Partner that the Milestone has been achieved by the relevant Milestone Date. In this case FUNDER shall provide the Partner with reasonable details of the grounds on which it considers that the Milestone has not been met by the Milestone Date, and FUNDER shall have no obligation to make any further payments to the Partner until such failure has been cured; or
3.8.3 where FUNDER (acting reasonably) has objections to the Financial Documents, FUNDER shall provide the Partner with reasonable details of its concerns, and shall have the right to request additional information and re- profile the payments of the FUNDER Funding to the Partner, provided that it informs the Partner of the revised payment schedule in writing.
3.9. End of Work Phase Reporting. At the end of each Work Phase, within twenty (20) Business Days of the last Milestone Date in that Work Phase, the Partner shall submit to FUNDER a final Milestone Report for that Work Phase and a Final Financial Summary.
3.10. Payment of Retained Amount. FUNDER shall pay the Retained Amount to the Partner within twenty (20) Business Days of FUNDER’s acceptance of the final Milestone Report provided that:
3.10.1. the Partner has used Reasonable Efforts to achieve the final Milestone for a given Work Phase by the relevant Milestone Date,
3.10.2. the Partner has confirmed to FUNDER in good faith that the findings and papers supported by the FUNDER Funding are compliant with the FUNDER Transparency Policy and the FUNDER Open Access Policy; and
3.10.3. the Final Financial Summary does not show any FUNDER Funding is unspent following completion of the Work Phase (an “Underspend”).
3.11. Underspend. In the event that the Final Financial Summary does show an Underspend FUNDER may:
3.11.1. Reduce any Retained Amount payable to the Partner by the value of the Underspend or
3.11.2. Where the Underspend is greater than the Retained Amount, FUNDER shall be under no obligation to pay the Retained Amount to the Partner, and the Partner shall (at FUNDER’s sole choice) either: (i) repay to FUNDER such Underspend (less the Retained Amount) within twenty (20) Business Days of providing the Final Financial Summary to FUNDER or (ii) carry over the Underspend for use in a subsequent Work Phase (if any).
3.13. Other Payment Conditions. In addition to the other requirements set out at this Clause 3, FUNDER shall only make payments of FUNDER Funding to the Partner if none of the events described at Clauses 15.2 or 15.3 have occurred.