Common use of DEDUCTIONS AND ADJUSTMENTS Clause in Contracts

DEDUCTIONS AND ADJUSTMENTS. The Earn-Out Payments shall be subject to the following deductions and adjustments: (i) In the event that the Development Costs incurred after the Closing and prior to the expiration of the Earn-Out Period exceed [***], then Buyer may offset such excess amount of Development Costs against any and all Earn-Out Payments that would otherwise become payable thereafter. (ii) If Buyer reasonably determines that it cannot develop or commercialize the Product without infringing, misappropriating or otherwise violating the Intellectual Property of any Third Party, then on a calendar quarter-by-calendar quarter basis, Buyer may offset up to [***] of any amounts due to any Third Party in consideration for a grant of rights to such Intellectual Property in such calendar quarter against any and all Earn-Out Payments otherwise due to Sellers in such calendar quarter; provided that the Earn-Out Payment due in any calendar quarter may not be reduced pursuant to this Section 2.3(c)(ii) by more than [***] of the amount otherwise due to Sellers in such calendar quarter, but Buyer may carry forward any such amounts that Buyer would otherwise be permitted to offset against Earn-Out Payments but for the foregoing [***] floor and apply such deductions against Earn-Out Payments due to Sellers in subsequent calendar quarters until fully offset. (iii) In the event Buyer grants a sublicense of its rights to the Product, cash payments associated with the grant of such a sublicense, including any closing payments and milestone payments, will be added to Net Sales in the calendar quarter in which such payments are received by Buyer; provided, however, that if Buyer enters into a sub-licensing agreement with [***], or with [***], Buyer will directly pay to Sellers Representative [***] of such cash payments when they are received and such amounts will not be counted as Net Sales.

DEDUCTIONS AND ADJUSTMENTS. The Earn-Out 8.1 MIGA shall: (a) deduct from any compensation due under the Contract, the Guarantee Holder’s share of any other compensation or benefit received or due to be received by or for the benefit of the Guarantee Holder, or the Project Enterprise, from any source, including the ratable portion of the Loss payable by any other insurer or guarantor, as a result of the Covered Risks which caused the Loss for which MIGA is liable to pay compensation; (b) only be liable to pay the amount of each Scheduled Payment then in default: (i) as and when originally scheduled to be due in accordance with the Payment Schedule, irrespective of whether Scheduled Payments on the Guaranteed Loan have been accelerated; and (ii) if the Guarantee Holder shall have complied with all terms and conditions of the Contract, including paying the Premium and Standby Option Fee, with respect to the corresponding Contract Period within which such Scheduled Payment falls due; and (c) notwithstanding Subsection 8.1(b) above, have the option, in its sole discretion and at any time, to prepay the Guarantee Holder by paying: (i) the Percentage of Cover of the amount of outstanding principal of the Guaranteed Loan, plus (ii) the Percentage of Cover of all corresponding accrued and unpaid Scheduled Payments of interest that were due on Scheduled Payment Due Dates occurring on or prior to the date of such prepayment by MIGA, but in no event exceeding the Amount of Guarantee. Any such payment shall be conditional upon the simultaneous payment by the Guarantee Holder to MIGA of the amount of Premium payable over the corresponding balance of the Guarantee Period, calculated based on the Payment Schedule (assuming that Scheduled Payments are paid when due and, with respect to variable rate interest, there is no change in interest rates). 8.2 Amounts of compensation determined to be payable by MIGA for any Loss shall: (a) in no event exceed the Amount of Guarantee during the relevant Contract Period; (b) be reduced, before application of any other reduction or adjustment, by any Deductible amount that may be specified under Clause 15 of the Special Conditions; (c) not include interest accruing at a penalty or default rate (including such interest payable in connection with any political risk event), mandatory prepayments of principal, acceleration of principal, make–whole premiums, break–funding costs, voluntary prepayments of principal, interest rate swaps and other derivatives transactions associated with the Guaranteed Loan, payments with respect to withholding taxes and other taxes, increased costs provisions, unpaid fees, costs and expenses, or any amounts other than Scheduled Payments due with respect to the Guaranteed Loan; and (d) be subject to adjustment if the following deductions Guarantee Holder has made or guaranteed loans to the Project Enterprise (other than loans payable in Local Currency) which MIGA has not guaranteed, and adjustments: (i) In the event that the Development Costs incurred Project Enterprise has, after the Closing and prior to the expiration date of default of the Earn-Out Period exceed [***]Scheduled Payment that is the basis of the Claim, then Buyer may offset such excess paid a greater percentage of the aggregate amount of Development Costs against any and all Earn-Out Payments that would otherwise become payable thereafterthe corresponding portions of such unguaranteed obligations than of the Scheduled Payments. (ii) If Buyer reasonably determines that it cannot develop or commercialize the Product without infringing8.3 Subject to Section 8.2 above, misappropriating or otherwise violating the Intellectual Property of any Third Party, then on a calendar quarter-by-calendar quarter basis, Buyer may offset up to [***] of any amounts due to any Third Party in consideration for a grant of rights to such Intellectual Property in such calendar quarter against any and all Earn-Out Payments otherwise due to Sellers in such calendar quarter; provided that the Earn-Out Payment due in any calendar quarter may not be reduced pursuant to this Section 2.3(c)(ii) by more than [***] application of the amount otherwise due to Sellers in such calendar quartercondition of average, but Buyer may carry forward any such amounts that Buyer would otherwise be permitted to offset against Earn-Out Payments but for the foregoing [***] floor and apply such deductions against Earn-Out Payments due to Sellers in subsequent calendar quarters until fully offset. (iii) In the event Buyer grants a sublicense of its rights to the Product, cash payments associated with the grant of such a sublicense, including any closing payments and milestone payments, will be added to Net Sales if there is an increase in the calendar quarter in which such payments are received by Buyer; provided, however, that if Buyer enters into a sub-licensing agreement with [***], or with [***], Buyer will directly pay to Sellers Representative [***] amount of such cash payments when they are received the Guaranteed Loan over and above the Amount of Guarantee and such amounts will are not guaranteed by MIGA at the time of the Loss, the Guarantee Holder shall only be counted entitled to recover such compensation hereunder for such proportion of any Loss as Net Salesthe Amount of Guarantee bears to the then outstanding amount of the Guaranteed Loan.