Common use of Development Project Clause in Contracts

Development Project. CMI agrees to diligently conduct research and development with a view toward completing the System development and engineering work to be performed by it as more fully described on Schedule C hereto (the "CMI Tasks"). Stryker agrees to fund [*] of the cost of the CD4I Tasks, up to a maximum expenditure therefor by Stryker of [*], but subject, unless Stryker agrees otherwise in writing, to the maximum amount budgeted for each Phase of the Development Project specified in Schedule C. CMI shall keep Stryker informed at reasonable times, orally or in writing, with respect to the status of the CMI Tasks and the overall Development Project and shall provide Stryker with a written report at the conclusion of each Phase. Promptly after the delivery of each such report, CMI shall, if requested to do so by Stryker, also give an oral presentation describing in reasonable detail the results of the Development Project through the end of that Phase as defined in Schedule C to persons designated by Stryker at a "Phase-End Meeting." The Phase-End Meetings shall be held within twenty-one (21) days of the end of that phase at locations alternately determined by CMI and Stryker. Stryker shall have the right, within 45 days of the holding of each Phase-End Meeting, to cancel the Development Project without further obligation to CMI except as set forth in paragraph 16 if the results thereof are unsatisfactory to Stryker or if Stryker shall have determined not to proceed with commercialization of the Systems. Stryker's share of the expenses for each Phase as set forth above shall be paid within forty-five (45) days after receipt of an invoice therefor, which shall be issued by CMI monthly subject to the maximum ceiling for each Phase of the Development Project and shall document in reasonable detail the total expenses incurred by CMI during the month to which it relates. As part of the Development Project, Stryker shall be responsible for the performance of the tasks assigned to it in Schedule C that are necessary to permit the interface of the System with the Stryker Products (the "Stryker Tasks"). Each of Stryker and CMI agrees to use its reasonable best efforts to perform the tasks for which it is responsible within the time allotted thereto in Schedule C. In the event that the entire project is delayed by six months or more, the party responsible therefor shall be penalized -- by a one-month reduction of the Exclusivity Period (as defined in Section 4) if Stryker's failure to perform the Stryker Tasks in a timely manner is the cause of the delay or a one-month increase in the Exclusivity Period if CMI's failure to perform the CMI Tasks in a timely manner is the cause of the delay. If the failure is a result of both CMI and Stryker actions, no change will be made to the Exclusivity Period. If the Development Project has not been completed on or before June 30, 1998 or such later date as the parties may agree in writing, this Agreement shall terminate and neither party shall have any continuing obligation to the other except as set forth in Section 16 hereof. In consideration of the payments to be made by Stryker hereunder, CMI agrees that it shall not conduct research and development activities with respect to products of the type described in Schedule B for use with products of the type described on Schedule A for any party other than Stryker as long as the Development Project is continuing and, thereafter, until the end of the Exclusivity Period.