Common use of Diligence Obligations Clause in Contracts

Diligence Obligations. OSI will use its COMMERCIALLY REASONABLE EFFORTS to seek approval of NDAs (or its equivalent) in the MAJOR MARKETS, and to develop, commercialize and market, and achieve FIRST COMMERCIAL SALE of the PRODUCT in the first MAJOR MARKET country on or before [**]. If OSI reasonably and in good faith believes that it cannot, within the exercise of reasonable business judgment, commercialize the PRODUCT in one or more MAJOR MARKET countries in the TERRITORY by [**], then, provided OSI has exercised COMMERCIALLY REASONABLE EFFORTS as required in this Section 3.7, OSI may request from NEKTAR AL an extension of time, and the PARTIES shall negotiate in good faith to determine a time extension that is mutually acceptable. If OSI does not use COMMERCIALLY REASONABLE EFFORTS in this regard, then, NEKTAR AL may, at its sole option and by giving written notice to OSI, either convert the LICENSE to be non-exclusive in the country or countries of the MAJOR MARKETS in the TERRITORY in which such default occurs or terminate this AGREEMENT with respect to the country or countries of the MAJOR MARKETS in the TERRITORY in which such default occurs (in which latter case the TERRITORY shall no longer include such country or countries). If the LICENSE becomes non-exclusive in one or more countries of the TERRITORY as provided for in the immediately preceding sentence, OSI’s obligations to pay milestones and royalties to NEKTAR AL, as provided for in this AGREEMENT, shall continue. Notwithstanding the preceding provisions of this Section 3.7, if OSI does not (a) use at least COMMERCIALLY REASONABLE EFFORTS to develop the PRODUCT file and seek approval of NDAs, on a schedule permitting achievement of the following clause (b), (b) make the FIRST COMMERCIAL SALE of the PRODUCT in [**] or more MAJOR MARKET countries on or before [**], and (c) thereafter use at least COMMERCIALLY REASONABLE EFFORTS to continue to commercialize and market the PRODUCT in such MAJOR MARKET COUNTRIES, it shall be deemed a material breach of this AGREEMENT by OSI, and NEKTAR AL may terminate this AGREEMENT under Section 11.4 as its sole and exclusive remedy with respect to such breach of this Section 3.7.

Diligence Obligations. OSI will 6.1.1. AstraZeneca undertakes to use Commercially Reasonable Efforts at its COMMERCIALLY REASONABLE EFFORTS own cost and expense to seek approval of NDAs (or its equivalent) develop a Licensed Product and to conduct all development necessary to obtain Health Registration Approvals for a Licensed Product for use in humans in each country listed in the MAJOR MARKETSdefinition of the Major Markets and throughout the Territory. 6.1.2. AstraZeneca undertakes to use Commercially Reasonable Efforts to commercialise a Licensed Product for use in humans in each of the Major Markets and throughout the Territory; provided, however, that such obligations are expressly conditioned upon Palatin and its Affiliates performing their respective obligations hereunder, including the completion of the activities under the Research Collaboration and the information disclosure requirements pursuant to Section 3.4, and such obligations of AstraZeneca shall be delayed or suspended to developthe extent any such condition causes a delay; and provided further, commercialize for the avoidance of doubt, that AstraZeneca shall not be obligated to obtain Health Registration Approval for, or commercialise, more than one Licensed Product in any Major Market and marketthroughout the Territory. In the event that AstraZeneca decides to discontinue the development or commercialisation of a Licensed Product in favour of another Licensed Product, its obligations under this Section 6.1.2. shall cease with respect to such initial Licensed Product in favour of such other Licensed Product. AstraZeneca shall perform its obligation under this Section 6.1.2 in good scientific manner and achieve FIRST COMMERCIAL SALE in compliance in all material respects with all Applicable Law. 6.1.3. Should the use by AstraZeneca of its Commercially Reasonable Efforts have as a consequence that AstraZeneca would be obligated to carry out some or all of the PRODUCT activities provided for in the first MAJOR MARKET Section 6.1.1 or 6.1.2 in a country on or before [**]. If OSI reasonably * then AstraZeneca shall, notwithstanding what is stated in Sections 6.1.1 and in good faith believes that it cannot6.1.2 and following consultation with Palatin, within the exercise of reasonable business judgment, commercialize the PRODUCT in one or more MAJOR MARKET countries in the TERRITORY by [be allowed to **]*. 6.1.4. Upon satisfaction of its obligations under Sections 6.1.1 and 6.1.2, thenAstraZeneca shall be deemed to have satisfied all diligence obligations owed to Palatin hereunder, provided OSI has exercised COMMERCIALLY REASONABLE EFFORTS as required in this Section 3.7, OSI may request from NEKTAR AL an extension of time, and the PARTIES shall negotiate in good faith to determine a time extension that is mutually acceptable. If OSI does not use COMMERCIALLY REASONABLE EFFORTS in this regard, then, NEKTAR AL may, at its sole option and by giving written notice to OSI, either convert the LICENSE to be non-exclusive in the country or countries of the MAJOR MARKETS in the TERRITORY in which such default occurs or terminate this AGREEMENT with respect to the country or countries Exploitation of the MAJOR MARKETS in the TERRITORY in which such default occurs (in which latter case the TERRITORY shall no longer include such country Agreement Compounds, Licensed Products or countries). If the LICENSE becomes non-exclusive in one or more countries of the TERRITORY as provided for in the immediately preceding sentence, OSI’s obligations to pay milestones and royalties to NEKTAR AL, as provided for in this AGREEMENT, shall continue. Notwithstanding the preceding provisions of this Section 3.7, if OSI does not (a) use at least COMMERCIALLY REASONABLE EFFORTS to develop the PRODUCT file and seek approval of NDAs, on a schedule permitting achievement of the following clause (b), (b) make the FIRST COMMERCIAL SALE of the PRODUCT in [**] or more MAJOR MARKET countries on or before [**]Collaboration Results, and (c) thereafter use at least COMMERCIALLY REASONABLE EFFORTS shall have no other obligation, express or implied, to continue to commercialize and market Exploit the PRODUCT in such MAJOR MARKET COUNTRIESAgreement Compounds, it shall be deemed a material breach of this AGREEMENT by OSI, and NEKTAR AL may terminate this AGREEMENT under Section 11.4 as its sole and exclusive remedy with respect to such breach of this Section 3.7Licensed Products or Collaboration Results.

Diligence Obligations. OSI will Idenix agrees to use its COMMERCIALLY REASONABLE EFFORTS commercially reasonable efforts (directly and/or through one or more Sublicensees) to seek approval of NDAs (or its equivalent) develop for sale in the MAJOR MARKETS, Major Markets and to develop, commercialize and market, and achieve FIRST COMMERCIAL SALE in each of the PRODUCT in the first MAJOR MARKET country on or before Major Markets at least [**]. If OSI reasonably and *] Development Candidate or Product in the Field. (a) In the event that Idenix: (i) is not developing for sale in the Major Markets or commercializing in a particular Major Market at least [***] Development Candidate or Product in the Field, or (ii) decides that it will not develop for sale in the Major Markets or commercialize in a particular Major Market at least [***] Development Candidate or Product in the Field, then Idenix shall provide Metabasis with prompt written notice thereof. (b) In addition, if Metabasis in good faith believes that Idenix is not using its commercially reasonable efforts to develop for sale in the Major Markets or commercialize in a particular Major Market at least [***] Development Candidate or Product in the Field, Metabasis may provide Idenix with written notice thereof, in which event Idenix will have [***] after the date of such notice in which to reasonably demonstrate to Metabasis that Idenix is meeting such diligence obligation. (c) If Idenix provides notice to Metabasis pursuant to Section 4.4(a) that it cannot, within the exercise of reasonable business judgment, commercialize the PRODUCT in is not and will not meet its diligence obligation with respect to one or more MAJOR MARKET countries in the TERRITORY by [**]Major Markets, then, provided OSI has exercised COMMERCIALLY REASONABLE EFFORTS as required in this or fails to reasonably demonstrate to Metabasis pursuant to Section 3.7, OSI may request from NEKTAR AL an extension of time, and the PARTIES shall negotiate in good faith to determine a time extension 4.4(b) that it is mutually acceptable. If OSI does not use COMMERCIALLY REASONABLE EFFORTS in this regard, then, NEKTAR AL may, at meeting its sole option and by giving written notice to OSI, either convert the LICENSE to be non-exclusive in the country or countries of the MAJOR MARKETS in the TERRITORY in which such default occurs or terminate this AGREEMENT diligence obligation with respect to the country or countries of the MAJOR MARKETS in the TERRITORY in which such default occurs (in which latter case the TERRITORY shall no longer include such country or countries). If the LICENSE becomes non-exclusive in one or more countries of the TERRITORY as provided for in the immediately preceding sentence, OSI’s obligations to pay milestones and royalties to NEKTAR AL, as provided for in this AGREEMENT, shall continue. Notwithstanding the preceding provisions of this Section 3.7, if OSI does not (a) use at least COMMERCIALLY REASONABLE EFFORTS to develop the PRODUCT file and seek approval of NDAs, on a schedule permitting achievement of the following clause (b), (b) make the FIRST COMMERCIAL SALE of the PRODUCT in [***] or more MAJOR MARKET countries on or before Major Markets within [**]*] after notice from Metabasis of failure to meet such diligence obligation, and then (ci) thereafter use at least COMMERCIALLY REASONABLE EFFORTS to continue to commercialize and market the PRODUCT in such MAJOR MARKET COUNTRIES, it this Agreement shall be deemed a material breach of this AGREEMENT by OSI, and NEKTAR AL may terminate this AGREEMENT under Section 11.4 as its sole and exclusive remedy with respect to such Major Market(s) in which Idenix is not using its commercially reasonable efforts to develop or commercialize at least [***] Development Candidate or Product in the Field, and (ii) “Territory” shall be redefined to be [***]. With respect to Section 4.4(a), Idenix shall not be in breach of this Agreement under Section 3.710.2(b) unless it provides notice to Metabasis pursuant to Section 4.4(a) that it is not and will not conduct development and commercialization of at least [***] Development Candidate or Product in the Field in at least one Major Market. With respect to Section 4.4(b), Idenix shall not be in breach of this Agreement under Section 10.2(b) unless Metabasis in good faith believes that Idenix is not using its commercially reasonable efforts to develop or commercialize at least [***] Development Candidate or Product in the Field in at least [***] Major Market, Metabasis provides Idenix with written notice thereof, and Idenix fails to reasonably demonstrate to Metabasis within [***] after the date of such notice that Idenix is meeting such diligence obligation in at least [***] of the Major Markets.

Diligence Obligations. OSI will (a) Lung Rx shall use its COMMERCIALLY REASONABLE EFFORTS Commercially Reasonable Efforts to Develop, and if in Lung Rx’s opinion the results of the Development Plan so justify, to seek approval of NDAs (or its equivalent) in the MAJOR MARKETSRegulatory Approval for, and Commercialize Products in major markets throughout the Territory as Lung Rx determines are commercially feasible in its sole discretion. The Development Plan shall include such Product Development work as Lung Rx may, in its sole discretion, consider necessary to develop, commercialize and marketsupport Regulatory Approval. (b) In the event that Lung Rx fails to materially comply with the diligence obligations set forth in Section 4.11(a), and achieve FIRST COMMERCIAL SALE Lung Rx fails to cure its material non-compliance within thirty (30) days following written notice from Aradigm providing a detailed explanation of such material non-compliance, Aradigm may, in its sole discretion, elect to convert the PRODUCT exclusive license granted to Lung Rx pursuant to Section 2.1(a) to a non-exclusive license with respect to a given Product, with all other terms and conditions of this Agreement remaining unchanged. Any such conversion to a non-exclusive license for a Product shall be effective upon Lung Rx’s receipt of written notice from Aradigm, but shall not affect other Products which are being Developed and/or Commercialized under this Agreement. (c) Notwithstanding the non-exclusivity conversion provision in Section 4.11(b), the first MAJOR MARKET country on diligence obligations set forth in this Section 4.11 shall not apply to the extent (i) Aradigm’s failure to perform its obligations under this Agreement in a timely manner causes a delay in Lung Rx’s Development, efforts to seek Regulatory Approval for, or before [**]. If OSI reasonably Commercialization of such Product; or (ii) there exists any material regulatory action affecting such Product; or (iii) there exists any material issue relating to the toxicology, safety, bioavailability or efficacy of such Product and the absence of any impediments caused by formulation, material sourcing, manufacturing, or other technical issues related to Product; in good faith believes each case that it cannotleads Lung Rx to conclude, within the exercise of in exercising reasonable business judgment, commercialize that Development or Commercialization of such Product should be suspended or stopped altogether. Upon the PRODUCT occurrence of circumstances described in one either subsection (i), (ii) or more MAJOR MARKET countries (iii), the following terms shall apply: (A) Lung Rx shall notify Aradigm in writing of the existence of such circumstances, specifying the details thereof and (in the TERRITORY by [**]case of circumstances described in subsection (ii) or (iii) the reasons why Lung Rx concluded that Development or Commercialization of such Product should be suspended or stopped, then, provided OSI has exercised COMMERCIALLY REASONABLE EFFORTS as required in this Section 3.7, OSI may request from NEKTAR AL an extension of time, and the PARTIES shall negotiate in good faith to determine a time extension that is mutually acceptable. If OSI does not use COMMERCIALLY REASONABLE EFFORTS in this regard, then, NEKTAR AL may, at its sole option and by giving written notice to OSI, either convert the LICENSE to be non-exclusive in the country or countries of the MAJOR MARKETS in the TERRITORY in which such default occurs or terminate this AGREEMENT with respect to the country or countries of the MAJOR MARKETS in the TERRITORY in which such default occurs (in which latter case the TERRITORY shall no longer include such country or countries). If the LICENSE becomes non-exclusive in one or more countries of the TERRITORY as provided for in the immediately preceding sentence, OSIB) Lung Rx’s obligations to pay milestones and royalties to NEKTAR AL, Develop or Commercialize such Product shall be suspended so long as provided for in this AGREEMENT, shall continue. Notwithstanding the preceding provisions of this Section 3.7, if OSI does not (a) use at least COMMERCIALLY REASONABLE EFFORTS to develop the PRODUCT file and seek approval of NDAs, on a schedule permitting achievement of the following clause (b), (b) make the FIRST COMMERCIAL SALE of the PRODUCT in [**] or more MAJOR MARKET countries on or before [**]any such circumstances exists, and (cC) thereafter use at least COMMERCIALLY REASONABLE EFFORTS to continue to commercialize and market the PRODUCT obligations set forth in such MAJOR MARKET COUNTRIES, it Section 4.11(a) shall be deemed a material breach extended by the period of this AGREEMENT by OSI, and NEKTAR AL may terminate this AGREEMENT under Section 11.4 as its sole and exclusive remedy any such suspension with respect to such breach of this Section 3.7Product.