2. LICENSE GRANT
(k) GARDP will diligently monitor and enforce each Sublicensee’s compliance with its Sublicense Agreement, including, without limitation, diligently reviewing the progress reports received from such Sublicensee, and monitoring compliance with the applicable Sublicense Access Plan. GARDP shall provide unredacted copies of any and all such progress reports to Shionogi within ten (10) Business Days of receipt.
3. RECOUPMENT OF COSTS
3.2 GARDP shall report Net Sales on Licensed Product sales in the Territory and the corresponding Cost Recoupment Fees due to Shionogi on a calendar quarter basis in accordance with Section 9.1, and shall pay the Cost Recoupment Fees due within thirty (30) days of receiving the corresponding invoice from Shionogi. Net Sales shall be reported and Cost Recoupment Fees shall be paid in Euros. In addition, GARDP shall promptly provide to Shionogi any reports and other information regarding Net Sales requested by Shionogi to facilitate Shionogi’s compliance with third party obligations, as detailed more specifically in Section 4 of the Collaboration Agreement.
9. AUDIT AND REPORTS
GARDP will send to Shionogi, within sixty (60) days following the end of each calendar quarter, the number of units of Licensed Product sold by strength by applicable stock keeping unit (SKU) or other applicable delineation by country, and the number of units of Licensed Product Manufactured by each Sublicensee, and current inventory reports. GARDP shall also provide Shionogi with a quarterly written report setting forth each Sublicensee’s: (a) Licensed Product in its portfolio; (b) status of Development of each Licensed Product in Development; (c) regulatory filing plan for each Licensed Product, by country; (d) a list of countries within the Territory for which such regulatory approvals or authorizations have been obtained for any Licensed Product; (e) any rejection, withdrawal, expiration, or other significant regulatory development for any Licensed Product; and (f) a description of activities performed by GARDP relating to filing, obtaining, or maintaining regulatory approvals or authorizations in the Territory for the Licensed Product and/or Licensed Compound. GARDP and Shionogi agree to confer on a quarterly basis regarding such reports and also to review development and filing status of Licensed Product. GARDP further agrees that Shionogi may share all such information and reports with its Affiliates at any time (subject to confidentiality and non–use obligations substantially similar to those set out in Section 10.1 hereof) and with third parties as contemplated by the Collaboration Agreement (including Section 4 thereof).
(a) GARDP grants Shionogi the right, upon reasonable notice of not less than forty–five (45) days, to inspect and audit, at its own cost:
(i) the performance of, and compliance with, this License Agreement and the Sublicense Agreements and applicable laws;
(ii) all documents and other records relating to the performance of this License Agreement and the Sublicense Agreements; and
(iii) all documents, records, and any other information required to determine the calculation of Cost Recoupment Fees owed under this License Agreement and any Sublicense Agreement.
(b) GARDP shall require its Sublicensees to keep and maintain at least ten (10) years of records of quantities of Licensed Product, and raw materials used to make Licensed Product, Manufactured and/or sold under each Sublicense Agreement, as well as any other information required to determine the calculation of Cost Recoupment Fees owed under the Sublicense Agreement. Shionogi and GARDP shall have the right to audit these Sublicensee records.
(c) Subject to execution of a confidentiality agreement with GARDP, Shionogi may choose to nominate an independent Third–Party auditor or consultant to exercise, or assist with the exercise of, its rights set out in this Section 9.
(d) GARDP will cooperate with and provide all reasonable assistance to Shionogi, its officers, employees, agents, advisors, representatives, or contractors exercising their rights under this Section 9.
Schedule F: Provisions for Sublicense Agreement
8. Records. Sublicensee shall keep at its principal place of business true and accurate records of Net Sales, quantities of Licensed Product, and raw materials used to make Licensed Product, manufactured and/or sold pursuant to this Agreement (itemized by number of units of Licensed Product sold by strength and by country, together with current inventory reports), proper and comprehensive books of account including all information required to calculate the Cost Recoupment Fees and other moneys from time to time payable pursuant to this Sublicense Agreement this Agreement. Records must be maintained for at least ten (10) years.
9. Licensor’s Right of Audit and Inspect. Sublicensee agrees at all reasonable times to permit Licensor’s or Sublicensor’s auditor to access, inspect and review the accounts, books and records referred to in Section 8. Such examination shall be conducted at Licensor’s or Sublicensor’s, as applicable, expense by an independent accountant, subject to execution of a customary confidentiality agreement with Sublicensee. The accountant may take copies of or extracts from the accounts, books and records, subject to the confidentiality agreement entered into by the accountant. Such audits may not be conducted more than once each calendar year and shall be conducted with reasonable prior notice and during normal office hours. Sublicensee agrees to give Licensor’s representatives reasonable assistance, access and facilities to enable them to verify such accounts, books and records and supply such other information as may be necessary or proper to enable Sublicensee’s compliance with this Agreement to be verified. The auditor shall only report to Licensor and/or Sublicensor whether Sublicensee is in compliance with its obligations and/or such information as is reasonably necessary to demonstrate any deviation. If an audit conducted in accordance with this Section  identifies a deviation of more than ten percent (10%) from the amounts identified as payable in statements provided by Sublicensee pursuant to Section [INSERT REFERENCE TO RECOUPMENT OF COSTS SECTION] in any consecutive period of four quarters, the costs of the audit are to be reimbursed to Licensor by Sublicensee on demand. Licensor’s and Sublicensor’s rights under this Section  above apply during the Term and for four (4) years thereafter.
Sublicensee also agrees to permit appropriate representatives of Licensor and/or Sublicensor to inspect, at their cost, Sublicensee’s manufacturing facilities and those of any permitted sub– contract manufacturers in order to verify Sublicensee’s compliance with this Agreement. At least ten Business Days’ advance notice of any such inspection will be given and such inspection shall be conducted with reasonable prior notice, during normal office hours and in a manner to minimize disruption of manufacturing operations. Sublicensee may require such representatives to sign a customary confidentiality agreement and may limit their access to facilities and documents that are reasonably necessary to verify that the manufacture of Licensed Compound and Licensed Product are compliant with the Sublicense Agreement.