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precautions to preserve the physical condition of the
Equipment, and upon the termination of this Agreement
pursuant to Section 12, shall return the Equipment to
MedChem [P.R.] in good working order and in the same
condition (taking into account normal wear and tear) as
it was initially provided to Alcon [P.R.]. In the
event of any damage to the Equipment covered by
insurance maintained by MedChem [P.R.], MedChem [P.R.]
shall be obligated to apply any proceeds received in
respect of such insurance, and Alcon [P.R.] shall be
relieved from liability to the extent of such proceeds.
5. Ordering Procedure.
5.1 Initial Annual Forecast. MedChem [P.R.]
shall be responsible for directing the quantity and
types of Avitene processed by Alcon [P.R.]. In that
regard, MedChem [P.R.] shall, within 60 days of the
date of this Agreement, deliver to Alcon [P.R.] an
annual forecast (the “Initial Forecast Amount”) of
MedChem[ P.R.]’s projected requirements for each
Avitene product for each calendar quarter or fraction
thereof during the period commencing on the date of
this Agreement and ending on December 31, 1988. * * *
5.2 Subsequent Annual Forecast. No later
than August 15, 1988 and 1989, MedChem [P.R.] shall
submit to Alcon [P.R.] its preliminary annual forecast
of its quarterly requirements of Avitene for the next
calendar year (the “Current Annual Forecast Amount”).
Such preliminary annual forecast shall be updated on
November 30, 1988 and 1989.
5.3 Annual Commitment. MedChem [P.R.] shall
order at least 80% of the Initial Forecast Amount or
the Current Annual Forecast Amount and Alcon [P.R.]
shall be required to process up to 250% of the Initial
Forecast Amount or the Current Annual Forecast Amount.
In this regard, Alcon [P.R.] shall be given a
reasonable amount of time to meet any increases over
the Initial Forecast Amount. Alcon [P.R.] agrees, upon
reasonable notice, to act in good faith to meet any
such increases. In addition, in connection with
MedChem[ P.R.]’s efforts to establish the MedChem
[P.R.] Plant pursuant to Section 13, Alcon [P.R.]
agrees, upon reasonable notice to use good faith
efforts to process such reasonable amounts in excess of
250% of the Current Annual Forecast Amount during the
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