Operating Royalty. Licensee shall pay to Licensor an operating royalty (the “Operating Royalty”) equal to two percent (2%) of the “Gross Revenues” (as defined below) received by Licensee from operation of each SkyView owned by Licensee or sublicensed to any subsidiary of Licensee or to any entity in which Licensee or any subsidiary or affiliate has a direct or indirect material economic or other management interest (each, a “Licensee Affiliate”). As used in this subsection (iv), “Gross Revenues” shall mean and include all income and revenues derived directly from (i) the operations of the subject SkyView, (ii) the sale of photographs and branded merchandise pertaining to the subject SkyView, (iii) payments received from any corporate, institutional or other sponsors, or advertisers of the subject SkyView itself, whose sponsorship or advertising is included on the SkyView, in the cars or gondolas, on the tickets or other literature provided to patrons or customers, or displayed on or with respect to the building(s), structure(s), improvements or facilities for intake or outflow of customers or patrons, restrooms, queing facilities, photo or branded merchandise sold or other concession areas within the SkyView ride, but not from sponsors or advertisers of or on other areas of a larger complex of which the SkyView is only one part or component, (iv) income from admissions and attraction ticket sales to the SkyView, including the fair and reasonable allocable share of any bundled packages, admissions to a larger facility of which the SkyView is only a part, whether paid to or received directly by Licensee, the Parent Company, or any Affiliate of the Licensee or the Parent Company. For the avoidance of doubt and ambiguity, Gross Revenue shall not include, (a) food and beverage sales and merchandise sales (except for photographs and branded merchandise as indicated above), or (b) sales or use taxes payable with respect to any items included within Gross Revenues.
Operating Royalty. Virgin shall pay to MAV a royalty of [***] derived during the [***] following the Effective Date, provided, however, that such royalty with respect to any Annual Royalty Period shall not exceed the applicable Annual Operating Royalty Cap. Virgin shall pay such royalty to MAV annually in arrears, within [***] after the end of each Annual Royalty Period in which the applicable [***] are received by Virgin or its agents. Virgin shall accompany each such royalty payment with a written statement, in form and substance acceptable to MAV, setting forth how such royalty payment has been calculated.
