Common use of Request for Reductions Clause in Contracts

Request for Reductions. If Pharmasset reasonably and in good faith believes that a lower royalty rate is required in order to permit Pharmasset to commercialize the Licensed Product in a particular country with a reasonable profit, Pharmasset may notify RFSP of such belief and their basis therefor and, if such notification is made, the Parties shall meet as promptly as practicable to discuss in good faith whether a reduction to the royalty rate for such Licensed Product in such country is appropriate provided that nothing shall require RFSP to agree to such a reduction and provided that any such reduction shall be subject to the approval of the Universities. In the event that RFSP and Pharmasset mutually believe that a reduction to the royalty rate for a Licensed Product in a particular country might be appropriate, RFSP shall seek the approval of the Universities for such a reduction, provided that in no event shall RFSP be obliged to agree to such a reduction if the Universities decline to approve such a reduction.