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Alcon [P.R.] in writing of, the failure of any sample,
shipment or lot of Avitene to meet in any material
respect the Product Specifications. MedChem [P.R.]
shall return to Alcon [P.R.] any such rejected sample,
shipment or lot of Avitene, at Alcon[ P.R.]’s expense.
Alcon [P.R.], at its expense, shall replace any
properly rejected sample, shipment or lot of Avitene.
Alcon [P.R.] shall also reimburse MedChem [P.R.] for
any inventory loss due to warehouse damage, damage
resulting from the failure of the Conversion Process
(except for damage resulting from changes in the
Conversion Process requested by MedChem [P.R.] and
instituted by Alcon [P.R.]) or the expiration of the
expiration date of any Avitene products stored by
MedChem [P.R.] in warehouse space provided by Alcon
[P.R.], provided that such expiration of the expiration
date is as a result of actions or omissions by Alcon
[P.R.] with respect to the management of the inventory.
Alcon [P.R.] will not be responsible for inventory
losses due to product obsolescence.
8.6 Product Recalls. If any Avitene product
is subjected to a recall by a governmental agency, or
in the event MedChem [P.R.], after notification to and
consultation with Alcon [P.R.], elects to make such a
recall based on MedChem[ P.R.]’s good faith belief that
such Avitene is defective or not in conformity with
Alcon[ P.R.]’s warranties, Alcon [P.R.] shall pay the
actual out-of-pocket costs in connection with such
recall, including without limitation the replacement of
recalled Avitene. The payment of such costs by Alcon
[P.R.] shall not be included in the computation of the
Processing Fee pursuant to Section 9 hereof. However,
if Alcon [P.R.] was not in breach of its warranties,
MedChem [P.R.] shall hold Alcon [P.R.] harmless and
shall bear all costs and expenses in connection with
such recall.
9. Payment.
9.1 Processing Cost. In return for the
processing services performed by Alcon [P.R.] for
MedChem [P.R.], MedChem [P.R.] shall pay to Alcon
[P.R.] a Processing Fee in connection with each Order
for Avitene Delivered pursuant to this Agreement. The
Processing Fee shall be equal to Alcon[ P.R.]’s
Processing Cost (as such term is defined below) plus
ten percent (10%). However, the Processing Fee will be
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