Common use of Supply Interruption Clause in Contracts

Supply Interruption. (a) If Supplier fails to deliver to Customer by the requested delivery date at least [ * ] of any Product ordered under a Purchase Order that conforms to the Product warranties in Section 4.2, and Supplier does not cure such failure within [ * ] after written notice from Customer of such failure to deliver, and provided that the failure to deliver does not result from [ * ], then Customer shall have the right to cancel the applicable Purchase Order as to any undelivered amounts and manufacture any shortfall quantity of Product itself or purchase such quantity from a third party. (b) If on [ * ] occasions, Supplier fails to deliver to Customer by the requested delivery date at least [ * ] of any Product ordered under a Purchase Order that conforms to the Product warranties in Section 4.2, and does not cure such failure within [ * ] after written notice from Customer of such failure to deliver, and provided that the failure to deliver does not result from [ * ], then in addition to the remedies under Section 1.8(a), (i) Customer shall have the right to manufacture itself or purchase from a third party all or a portion of its requirements for Products, until such time as Supplier reasonably demonstrates that it is able adequately to supply Customer’s requirements for Products, (ii) Customer’s exclusivity obligations and the exclusive rights granted to Supplier under Section 2.1(a) will terminate, and (iii) all of Customer’s forecasts will become non-binding, and (iv) such failure by Supplier will be deemed a material breach of this Agreement. (c) If on [ * ], as a result of causes beyond Supplier’s reasonable control, Supplier fails to deliver to Customer by the requested delivery date at least [ * ] of any Product ordered under a Purchase Order that conforms to the Product warranties in Section 4.2, and does not cure such failure within [ * ] after written notice from Customer of such failure to deliver, then in addition to the remedies under Section 1.8(a), (i) Customer shall have the right to manufacture itself or purchase from a third party all or a portion of its requirements for Products, until such time as Supplier reasonably demonstrates that it is able adequately to supply Customer’s requirements for Products, (ii) Customer’s exclusivity obligations and the exclusive rights granted to Supplier under Section 2.1(a) will be suspended until Supplier reasonably demonstrates that it is able adequately to supply Customer’s requirements for Products, and thereafter such exclusivity obligations will be subject to any agreements between Customer and a third party manufacturer to supply Product, and (iii) such failure by Supplier will not be deemed a material breach of this Agreement.