Common use of Diligence Requirement Clause in Contracts

Diligence Requirement. The Developing Party’s right to exclusively develop and commercialize a Sole Development Product is expressly conditioned on such Party’s continuing effort to use Commercially Reasonable Efforts to develop such Sole Development Product (the “Diligence Requirement”). The Diligence Requirement shall be conditioned upon the continuing absence of any adverse condition or event that warrants a delay in the development, clinical testing or commercialization of a particular Sole Development Product; provided that a delay shall only be warranted for as long as the condition or event preventing the performance continues and, upon cessation of such condition or event, the Developing Party shall promptly resume performance hereunder. Such conditions and events shall include, without limitation, the inability to produce preclinical or clinical supplies, events that would cause delays in clinical studies (e.g., negative toxicological or pharmacological test results or an adverse clinical event), challenges within the regulatory process, or intellectual property impediments to developing a Sole Development Product that the Developing Party could not reasonably have foreseen. If the Discontinuing Party reasonably believes that the Developing Party has failed to satisfy the Diligence Requirement with respect to a Sole Development Product, it shall so notify the Developing Party in writing and the Developing Party shall Table of Contents then have ninety (90) days to demonstrate to the Discontinuing Party’s reasonable satisfaction that the Diligence Requirement for such Sole Development Product has been satisfied. Any dispute regarding the satisfaction of the Diligence Requirement shall be resolved by the Parties under the terms of ARTICLE XVII below. If it is determined that the Diligence Requirement has not been satisfied with respect to a Sole Development Product, then the Parties shall meet and discuss in good faith a mutually agreeable process for development and commercialization of the Sole Development Product.

Diligence Requirement. The Developing Party’s right to exclusively develop and commercialize a Sole Development Product is expressly conditioned on such Party’s continuing effort to use Commercially Reasonable Efforts to develop such Sole Development Product (the “Diligence Requirement”). The Diligence Requirement shall be conditioned upon the continuing absence of any adverse condition or event that warrants a delay in the development, clinical testing or commercialization of a particular Sole Development Product; provided that a delay shall only be warranted for as long as the condition or event preventing the performance continues and, upon cessation of such condition or event, the Developing Party shall promptly resume performance hereunder. Such conditions and events shall include, without limitation, the inability to produce preclinical or clinical supplies, events that would cause delays in clinical studies (e.g., negative toxicological or pharmacological test results or an adverse clinical event), challenges within the regulatory process, or intellectual property impediments to developing a Sole Development Product that the Developing Party could not reasonably have foreseen. If the Discontinuing Party reasonably believes that the Developing Party has failed to satisfy the Diligence Requirement with respect to a Sole Development Product, it shall so notify the Developing Party in writing and the Developing Party shall Table of Contents then have ninety (90) days to demonstrate to the Discontinuing Party’s reasonable satisfaction that the Diligence Requirement for such Sole Development Product has been satisfied. Any dispute regarding the satisfaction of the Diligence Requirement shall be resolved by the Parties under the terms of ARTICLE XVII below. If it is determined that the Diligence Requirement has not been satisfied with respect to a Sole Development Product, then the Parties shall meet and discuss in good faith a mutually agreeable process for development and commercialization of the Sole Development Product.