Common use of Changes to Products Clause in Contracts

Changes to Products. Section 4.01 With respect to changes to the Products, the following shall apply: (a) Either Party shall be entitled to propose changes to the Products (including their Specifications, design, manufacturing process or manufacturing site) by written notice to the other Party setting out full details of such proposed changes (including any expected impact on the Purchase Price). Any such change request shall only be implemented upon the other Party’s prior consent (such consent not to be unreasonably withheld, conditioned or delayed – in particular in case of change requests originating from the Recipient’s end customers), except that the Supplier shall be entitled to implement any changes without the Recipient’s consent which are required to comply with applicable Law relevant to the manufacture of the Products at the relevant manufacturing site (Mandatory Changes). The Parties acknowledge that the Recipient may have to conduct testing to ensure that the performance of a Product under changed Specifications meets all applicable requirements before giving its consent to a change request. (b) The Recipient shall bear the one-off costs arising in connection with the implementation of any Mandatory Change. For any other change, the one-off costs arising in connection with the implementation of such change shall be borne by the Party requesting the change. The Parties shall use commercially reasonable efforts to avoid or mitigate such one-off costs when implementing the relevant change. To the extent that one Party may charge one-off costs to the other Party according to this Section 4.01(b), these shall be calculated on a cost plus ten percent (10%) basis. (c) Upon implementation of a change, the Purchase Price for the relevant Product shall be adjusted to reflect any increase or decrease of the Supplier’s Standard Costs resulting from the change. (d) Changes to Products agreed under this Section 4.01 shall be documented and reflected in Schedule 1 and, where applicable, the Specifications of that Product.