Distributor shall have the right to assemble the Products itself or through affiliated third parties within the Exclusive Territory, provided however that all proprietary rights relating to the Products including all copyrights, patents, trade secrets, trade names, trademarks and service marks used or promoted by either the Company, the Distributor or their respective sub-distributors, agents with respect to the Products are the sole and exclusive property of the Company and any such Sub-Assemblers shall be bound by the terms of this Agreement. The Company shall cooperate with the Distributor in training at any such sub-assembly facilities to insure the highest standard of quality control at the expense of Distributor. In the event the Distributor intends to assemble the Products elsewhere, it shall inform the Company in writing as soon as practicable and shall pay an annual royalty fee on any sales of the Products assembled or manufactured based on the following schedule:
Fifteen percent (15%) of gross sales. All royalties shall be paid quarterly, in US Dollars within thirty days of the end of each calendar quarter. Distributor shall keep accurate sales records which shall be available for review, inspection and audit by the Company during normal business hours of the Distributor.