Common use of Rejected Products Clause in Contracts

Rejected Products. CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND WILL BE FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A CONFIDENTIAL TREATMENT REQUEST. (a) Except for any minor departures from Specifications or nonconformities not impairing the safety or efficacy of Products to which COMPANY may reasonably waive objection, COMPANY may reject any Product which fails to meet the Specifications. COMPANY shall, within twenty (20) days after its receipt of any shipment of Product and related Certificate of Analysis of Product batch (as described in paragraph 5.1 hereof), notify DPT in writing of any claim relating to rejected Product batch and, failing such notification, shall be deemed to have accepted such Product batch. Such notice to DPT shall specify why the Product batch failed to perform to Specifications. DPT shall have an opportunity to inspect or test said Product batch. All Products shall be submitted to inspection and evaluation in accordance with DPT’s SOP’s to determine whether or not said Products meet the Specifications. As to any such Product batch (including phases of or complete batches of bulk product) which is determined to fail the Specifications and may be rejected by COMPANY or DPT (“Rejected Product”), DPT, at its sole cost and expense (including shipping) shall replace such Rejected Product promptly after all raw materials are available to DPT for the manufacture. If requested, DPT shall make arrangements with COMPANY for the return or disposal of Rejected Product at DPT’s sole cost and expense. (b) In the event of a conflict between the test results of DPT and the test results of COMPANY with respect to any shipment of Product batch, a sample of such Product batch shall be submitted by DPT to an independent laboratory acceptable to both parties for testing against the Specifications under procedures employed in the Specifications. The fees and expenses of such laboratory testing shall be borne entirely by the party against whom such laboratory’s finding are made. If results from the independent laboratory are inconclusive, final resolution will be settled in accordance with paragraph 13.6 (b) below. (c) Following validation, for all commercial production batches of a Product produced by DPT (“Commercial Batches”) in the event a Rejected Product is due to COMPANY supplied information, formulations or materials, COMPANY shall bear one hundred percent (100%) of all costs directly related to and invoiced for Rejected Product including cost of destruction of the Rejected Product. In the event a Rejected Product is due to DPT’s willful malfeasance, breach of its warranties provided for herein or any other material breach of this Agreement and such conduct renders the Product unmarketable, or in the event more than two (2) Commercial Batches are rejected in any calendar year, DPT shall bear one hundred percent (100%) of the manufacturing fees, costs of materials supplied by DPT and costs of destruction. In the event the Product does not meet final specifications, but such failure is not due to either COMPANY supplied information or DPT’s, willful malfeasance, breach of its ** CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND WILL BE FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A CONFIDENTIAL TREATMENT REQUEST. warranties or any other material breach of this Agreement the COMPANY shall bear all material costs with DPT bearing all Manufacturing Fees related to Rejected Product, and with destruction to be conducted by the COMPANY with costs shared equally by the parties. Destruction of rejected Product shall be in accordance with all applicable laws and regulations and the party conducting the destruction shall indemnify the other party hereto for any liability, costs or expenses, including attorney’s fees and court costs, relating to a failure to dispose of such Product in accordance with such laws and regulations. The party conducting the destruction shall also provide to the other party hereto all manifests and other applicable evidence of proper destruction as may be requested by applicable law. The parties agree that any dispute concerning the operation or effect of this paragraph 2.7 will be resolved in accordance with paragraph 13.6 (b) below.

Rejected Products. CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND WILL BE FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A CONFIDENTIAL TREATMENT REQUEST. (a) Except for any minor departures from Specifications or nonconformities not impairing the safety or efficacy of Products to which COMPANY may reasonably waive objection, COMPANY Connetics may reject any Product which fails to meet the SpecificationsSpecifications ("Rejected Product"). COMPANY Connetics shall, within twenty (20) days after its receipt of any shipment of Product and related Certificate of Analysis of Product batch (as described in paragraph SECTION 5.1 hereofof this Agreement), notify DPT in writing of any claim relating to rejected Product batch and, failing such notification, shall be deemed to have accepted such Product batch. Such notice to DPT shall specify why the Product batch failed to perform to Specifications. Connetics shall grant to DPT shall have an opportunity the right to inspect or test said Product batch. All Products shall be submitted to inspection and evaluation in accordance with DPT’s 's SOP’s 's to determine whether or not said Products meet the Specifications. . (b) As to any such Rejected Product batch pursuant to SECTION 3.7(a) above (including phases of or complete batches of bulk product) which is determined to fail the Specifications and may be rejected by COMPANY or DPT (“Rejected Product”), DPT, at its sole cost and expense (including shipping) DPT shall replace such Rejected Product (in an agreed upon batch order quantity, but in no event less than full batch increments) promptly after all raw materials are available to DPT for the manufacture. If requested, DPT shall make arrangements with COMPANY Connetics for the return or disposal of Rejected Product at DPT’s sole cost and expense. (b) In the event of a conflict between the test results of DPT and the test results of COMPANY with respect to any shipment of Product batch, a sample of such Product batch shall be submitted by DPT to an independent laboratory acceptable to both parties for testing against the Specifications under procedures employed in the Specifications. The fees and expenses of such laboratory testing shall be borne entirely by the party against whom such laboratory’s finding are made. If results from the independent laboratory are inconclusive, final resolution will be settled in accordance with paragraph 13.6 (b) belowProduct. (c) Following validationIf a Rejected Product clearly results from DPT's equipment failure, damage from DPT's facilities, and/or DPT's misweighing of chemicals, DPT shall bear one hundred percent of all costs directly related to and invoiced by DPT for Rejected Product, including costs of destruction, but excluding the cost of any materials supplied by Connetics. Except as provided in the preceding * Certain information on this page has been omitted and filed separately with the Commission. Confidential treatment has been requested with respect to the omitted portions. sentence, for the initial three (3) batches and all commercial production validation batches of a Product produced by DPT (“Commercial Batches”) DPT, or in the event a Rejected Product is due to COMPANY Connetics supplied information, formulations or materials, COMPANY Connetics shall bear one hundred percent (100%) of all costs directly related to and invoiced by DPT for Rejected Product including cost of destruction of the Rejected Product. In the event , which shall be conducted by Connetics in accordance with all applicable laws and regulations. (d) If a Rejected Product is due to DPT’s willful malfeasance, breach of its warranties provided for herein or any other material breach of this Agreement and such conduct renders the Product unmarketable, or in the event more than two (2) Commercial Batches are rejected in any calendar year, DPT shall bear one hundred percent (100%) of the manufacturing fees, costs of materials supplied by DPT and costs of destruction. In the event the validated Product does not meet final specificationsSpecifications and results in a Rejected Product, but such failure is not clearly due to either COMPANY Connetics supplied information or DPT’s's equipment failure, willful malfeasancefailure to follow written Specifications, breach damage from DPT's facilities and/or DPT's misweighing of its ** CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND WILL BE FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A CONFIDENTIAL TREATMENT REQUEST. warranties or any other material breach of this Agreement the COMPANY chemicals, Connetics shall bear all material costs Materials Fees with DPT bearing all Manufacturing Fees related to Rejected Product, and with destruction to be conducted paid by the COMPANY with costs shared equally by the parties. Connetics. (e) Destruction of rejected Rejected Product shall be in accordance with all applicable laws and regulations and the party conducting the destruction shall indemnify the other party hereto for any liability, costs or expenses, including attorney’s 's fees and court costs, relating to a failure to dispose of such Product in accordance with such laws and regulations. The party conducting the destruction shall also provide to the other party hereto all manifests and other applicable evidence of proper destruction as may be requested by applicable law. (f) In the event of a conflict between the test results of DPT and the test results of Connetics with respect to any shipment of Product batch, a sample of such Product batch shall be submitted by DPT to an independent laboratory acceptable to both parties for testing against the Specifications utilizing the methods set out in the Specifications. The parties agree that any dispute concerning fees and expenses of such laboratory testing shall be borne entirely by the operation or effect of this paragraph 2.7 party against whom such laboratory's findings are made. If results from the independent laboratory are inconclusive, final resolution will be resolved settled in accordance with paragraph 13.6 (bSECTION 14.6(b) below.

Rejected Products. CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND WILL BE FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A CONFIDENTIAL TREATMENT REQUEST. (a) Except for any minor departures from Specifications or nonconformities not impairing the safety or efficacy of Products to which COMPANY may reasonably waive objection, COMPANY Connetics may reject any Product which fails to meet the SpecificationsSpecifications ("Rejected Product"). COMPANY Connetics shall, within twenty (20) days after its receipt of any shipment of Product and related --------------- ** Certain information on this page has been omitted and filed separately with the Commission. Confidential treatment has been requested with respect to the omitted portions. Certificate of Analysis of Product batch (as described in paragraph SECTION 5.1 hereofof this Agreement), notify DPT in writing of any claim relating to rejected Product batch and, failing such notification, shall be deemed to have accepted such Product batch. Such notice to DPT shall specify why the Product batch failed to perform to Specifications. Connetics shall grant to DPT shall have an opportunity the right to inspect or test said Product batch. All Products shall be submitted to inspection and evaluation in accordance with DPT’s 's SOP’s 's to determine whether or not said Products meet the Specifications. . (b) As to any such Rejected Product batch pursuant to SECTION 3.7(a) above (including phases of or complete batches of bulk product) which is determined to fail the Specifications and may be rejected by COMPANY or DPT (“Rejected Product”), DPT, at its sole cost and expense (including shipping) DPT shall replace such Rejected Product (in an agreed upon batch order quantity, but in no event less than full batch increments) promptly after all raw materials are available to DPT for the manufacture. If requested, DPT shall make arrangements with COMPANY Connetics for the return or disposal of Rejected Product at DPT’s sole cost and expenseProduct. (bc) If a Rejected Product clearly results from DPT's equipment failure, damage from DPT's facilities, and/or DPT's misweighing of chemicals, DPT shall bear one hundred percent of all costs directly related to and invoiced by DPT for Rejected Product, including costs of destruction, but excluding the cost of any materials supplied by Connetics. Except as provided in the preceding sentence, for the initial three (3) batches and all validation batches of a Product produced by DPT, or in the event a Rejected Product is due to Connetics-supplied information, formulations or materials, Connetics shall bear one hundred percent (100%) of all costs directly related to and invoiced by DPT for Rejected Product including cost of destruction of the Rejected Product, which shall be conducted by Connetics in accordance with all applicable laws and regulations. (d) If a validated Product does not meet final Specifications and results in a Rejected Product, but such failure is not clearly due to either Connetics-supplied information or DPT's equipment failure, failure to follow written Specifications, damage from DPT's facilities and/or DPT's misweighing of chemicals, Connetics shall bear all Materials Fees with DPT bearing all Manufacturing Fees related to Rejected Product, and with destruction to be paid by the Connetics. (e) Destruction of Rejected Product shall be in accordance with all applicable laws and regulations and the Party conducting the destruction shall indemnify the other Party hereto for any liability, costs or expenses, including attorney's fees and court costs, relating to a failure to dispose of such Product in accordance with such laws and regulations. The Party conducting the destruction shall also provide to the other Party hereto all manifests and other applicable evidence of proper destruction as may be requested by applicable law. (f) In the event of a conflict between the test results of DPT and the test results of COMPANY Connetics with respect to any shipment of Product batch, a sample of such Product batch shall be submitted by DPT to an independent laboratory acceptable to both parties Parties for testing against the Specifications under procedures employed utilizing the methods set out in the Specifications. The fees and expenses of such laboratory testing shall be borne entirely by the party Party against whom such laboratory’s finding 's findings are made. If results from the independent laboratory are inconclusive, final resolution will be settled in accordance with paragraph 13.6 SECTION 14.6 (b) below. (c) Following validation, for all commercial production batches of a Product produced by DPT (“Commercial Batches”) in the event a Rejected Product is due to COMPANY supplied information, formulations or materials, COMPANY shall bear one hundred percent (100%) of all costs directly related to and invoiced for Rejected Product including cost of destruction of the Rejected Product. In the event a Rejected Product is due to DPT’s willful malfeasance, breach of its warranties provided for herein or any other material breach of this Agreement and such conduct renders the Product unmarketable, or in the event more than two (2) Commercial Batches are rejected in any calendar year, DPT shall bear one hundred percent (100%) of the manufacturing fees, costs of materials supplied by DPT and costs of destruction. In the event the Product does not meet final specifications, but such failure is not due to either COMPANY supplied information or DPT’s, willful malfeasance, breach of its ** CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND WILL BE FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A CONFIDENTIAL TREATMENT REQUEST. warranties or any other material breach of this Agreement the COMPANY shall bear all material costs with DPT bearing all Manufacturing Fees related to Rejected Product, and with destruction to be conducted by the COMPANY with costs shared equally by the parties. Destruction of rejected Product shall be in accordance with all applicable laws and regulations and the party conducting the destruction shall indemnify the other party hereto for any liability, costs or expenses, including attorney’s fees and court costs, relating to a failure to dispose of such Product in accordance with such laws and regulations. The party conducting the destruction shall also provide to the other party hereto all manifests and other applicable evidence of proper destruction as may be requested by applicable law. The parties agree that any dispute concerning the operation or effect of this paragraph 2.7 will be resolved in accordance with paragraph 13.6 (b) below.