Definition of Delay Cost. For purposes of this Agreement, "Delay Cost" shall mean, for any Batch which is subject to a Delay, the sum of (i) the actual, documented cost [*] in such Batch and [*]; and (ii) an amount equal to the [*] of: (v) the product of [*] (for a Delay of [*] or less) or [*]) (for a Delay of more than [*]) multiplied by the Scheduled Vials; or (w) [*] per Batch of Labeled Drug subject of a Delay. The [*] provided for in Section 6.1(c) (ii) above shall automatically increase once per year on each anniversary of the Effective Date as follows: (x) on the first anniversary of the Effective Date by an amount equal to the [*] of the percentage increase in CPI in the previous twelve (12) month period and [*] percent [*] (y) on the second anniversary of the Effective Date by an amount equal to the [*] of the percentage increase in CPI in the previous twelve (12) month period and [*] percent [*] and (z) on each of the third and following anniversaries of the Effective Date of the Agreement by an amount equal to the [*] of the percentage increase in CPI in the previous twelve (12) month period and [*]. ----------------------------------- * Confidential treatment requested.
