Royalty Credit. If Licensee, its Affiliate or its Sublicensee is required to license or acquire technology (including, but not limited to, patent rights and/or other intellectual property rights) from a third party in order to practice the Licensed Patent Rights or to develop or commercialize a Licensed Product or Licensed Process because the exploitation of the Licensed Patent Rights would infringe that third party’s intellectual property rights without obtaining a license to such third party technology, [***], then Licensee may deduct up to [***] of the amount paid to such third party from the payments owing to TSRI for such Licensed Product or Licensed Process [***]. The above offset right is subject to the requirement that Licensee, its Affiliate or its Sublicensee shall not decrease the royalty or other amounts owed to TSRI under this Agreement by more than [***] of the amount due. Notwithstanding the above, Licensee, its Affiliate or its Sublicensee shall have no right to deduct or offset any royalties or other amounts with respect to any third party technology that is the subject of any cross license or similar arrangements (whether in the same or related transactions) where Licensee, its Affiliate or its Sublicensee grants or provides to such third party or its affiliates licenses, options or other rights to existing or future technology, intellectual property, research or development activities or other information or materials. Licensee will give TSRI advance written notice of any third party arrangement sufficiently prior to seeking to deduct any payments to the third party under the terms of this Section 3.5 in order to allow TSRI and Licensee to mutually determine whether such third party’s technology is required in order to practice or exploit the Licensed Patent Rights.
Royalty Credit. If Licensee, its Affiliate or its Sublicensee determines, upon the advice of patent counsel, that it is required to obtain a license under patent rights of one or more third parties that would, in the absence of such license, be infringed by Licensee’s (or its Affiliate’s or Sublicensee’s) practice of the inventions claimed by the Licensed Patent Rights in the manufacture, use, sale, offer for sale or import of a Licensed Product in a particular country, such that the total royalty burden (including royalties payable to TSRI) for such Licensed Product exceeds *** of Net Sales of such Licensed Product in that particular country, then Licensee shall be entitled to deduct from the royalties due under Section 3.3 with respect to sales of such Licensed Product in that particular country *** of the royalties actually paid to any and all such third parties in excess of *** of Net Sales of such Licensed Product in such country (including royalties payable to TSRI). The above offset right is subject to the requirement that the royalties payable to TSRI hereunder with respect to such Licensed Product shall not be reduced below *** of Net Sales in the case of a Licensed Product other than a Non-Patent Product, or *** of Net Sales in the case of a Non-Patent Product (the “Royalty Floor”) in any calendar quarter as a result of any and all such offsets in the aggregate. Notwithstanding the above, Licensee, its Affiliate or its Sublicensee shall have no right to deduct or offset any royalties or other amounts with respect to any third party technology that is the subject of any cross license or similar arrangements (whether in the same or related transactions) where Licensee, its Affiliate or its Sublicensee grants or provides to such third party or its affiliates licenses, options or other rights to existing or future technology, intellectual property, or products.
Royalty Credit. If Licensee is required, upon the advice of patent counsel, to obtain a license under valid and issued patent rights of one or more third parties that cover compositions of matter or methods that encompass the composition or method claims of the Licensed Patent Rights, then License, its Affiliates or Sublicensees shall be entitled to deduct from the Royalties due to TSRI under Section 4.4 with respect to sales of Licensed Product or Option Product up to [***] of the royalties Licensee actually paid to such third parties. The above offset right is subject to the requirement that the Royalties paid to TSRI hereunder with respect to such Licensed Product or Option Product shall not be reduced below [***] of the Royalties for that Licensed Product or Option Product that would otherwise be due hereunder without such credit. For clarity, only one of Licensee, its Affiliates or Sublicensees may exercise such right to deduct with respect to a given third-party royalty obligation. [***] Licensee will give TSRI prior written notice of any third party license that would satisfy the above requirements for a Royalty credit sufficiently in advance of deducting such credit from Royalties due to TSRI hereunder in order to allow TSRI and Licensee to mutually determine whether the requirements of this Section have been satisfied.
Royalty Credit. (a) If Licensee or any of its Affiliates or its Sublicensees determines, after consultation with patent counsel, that it is necessary to obtain a license under patent rights of one or more third parties with respect to Licensee’s (or its Affiliate’s or Sublicensee’s) manufacture, use, sale, offer for sale or importation of a given Licensed Product, then Licensee shall be entitled to deduct from the royalties due under Section 3.4 with respect to Net Sales of such Licensed Product in that particular country [*] of the royalties actually paid by Licensee and Affiliates and Sublicensees to any and all such third parties. For example, Licensee may in-license from one or more third parties a compound, product and/or a method of therapeutic or diagnostic use with potential applicability to a Licensed Product in the Therapeutic Field or the Diagnostic Field. Royalty credit(s) under this subsection (a) shall include royalties payable to a third party with respect to patent rights directed to (1) a compound that is incorporated in a Licensed Product for use in the Therapeutic Field; (2) a compound, product and/or a method that is used with a Licensed Product in the Diagnostic Field, or (3) a method of using a compound incorporated in a Licensed Product in the Therapeutic Field.
(b) The above right to deduct is subject to (i) the requirement that the royalties payable to TSRI under Section 3.4 with respect to such Licensed Product shall not be reduced by more than [*] of the amounts due to TSRI in such particular country (the “Royalty Floor”) in any calendar quarter as a result of any and all such deductions in the aggregate; and (ii) the exclusion of third-party royalty obligations owed by Licensee and Affiliates and Sublicensees as of the Effective Date. For clarity, only one of Licensee, Affiliate or Sublicensee may exercise such right to deduct with respect to a given third-party royalty obligation. Notwithstanding the above, Licensee, its Affiliates or its Sublicensees shall have no right to deduct any royalties or other amounts with respect to any third party technology that is the subject of any cross license or similar arrangements (whether in the same or related transactions) where Licensee, its Affiliates or its Sublicensees grant or provide to such third party licenses, options or other rights to existing or future technology, intellectual property, or products of Licensee, of Affiliate(s) or of Sublicensee(s).
Royalty Credit. Conatus shall be entitled to credit fifty percent (50%) of any royalty paid to a third party by Conatus in order for Conatus to be able to make, use and sell Emricasan; provided, however, in no event will the royalty payable in accordance with Section 3.1 be reduced by more than fifty percent (50%) in any quarter as a result of the credit available to Conatus under this Section 3.6.
Royalty Credit. If Licensee is required, upon the advice of patent counsel, to obtain a license under patent rights held by a Third Party that would, in the absence of such license, be infringed by Licensee’s practice of the inventions claimed by the Licensed Patent Rights in the manufacture, use or sale of a Licensed Product, then Licensee shall be entitled to deduct from the royalties due to TSRI under Section 3.4(a) with respect to sales of that Licensed Product […***…]% of the royalties Licensee actually paid to such Third Party in that reporting period, provided that the royalties payable to TSRI with respect to such Licensed Product in such country may not be reduced by more than […***…]% in any calendar quarter as a result of any and all such offsets in the aggregate. Licensee shall not be entitled to any Third Party royalty credit with respect to sales of Company Products.
Royalty Credit. After full recoupment of the Advance, SMI shall be credited and shall deduct fifty percent (50%) of the royalties that are earned and received by SMI and that are otherwise due to PGIC by SMI until the total of $1.75 million is recouped by SMI over a maximum of a ten (10) year period (the “Royalty Credit”).
Royalty Credit. If after the Effective Date Licensee or its sublicensee becomes required to make bona fide and commercially reasonable payments to one or more independent third parties during any calendar year to obtain a license or similar right under the third party’s intellectual property, in the absence of which the Licensee or its sublicensee could not make, have made, use, have used, offer for sale, sell, have sold, export or import any Products, then [***] percent ([***]%) of such payments for the applicable payment period shall be credited against the royalty payable to XXXX, provided in no event shall the royalty due to XXXX in any payment period be reduced to less than [***] percent ([***]%) and any such payments to third parties not used for a payment period as a result of such limitation may be carried forward and used in future payment periods.
Royalty Credit. On a Licensed Product-by-Licensed Product basis, in the event that Ocera or any of its Sublicensees, as applicable, obtains a license to any intellectual property rights of a Third Party (a “Third Party License”) in order to avoid infringing such Third Party’s patent(s) in the course of the manufacture, use or sale of Licensed Products, Ocera shall have the right to credit [*] of any payment made to such Third Party under such Third Party License against up to [*] of any royalty otherwise due to UCL hereunder; provided, however, that in no event shall the royalties due to UCL for any Licensed Product in any Calendar Quarter be reduced to less than [*] of the royalties then due and payable to UCL.
Royalty Credit. Astellas may deduct from the royalties owed for a particular Calendar Quarter pursuant to Section 4.3.1 the following amounts:
(a) the aggregate Transfer Price paid by Astellas for Commercial supply of Licensed Compound pursuant to Section 3.4 in the applicable Calendar Quarter or any previous Calendar Quarter (and not previously credited), but only up to an amount equal to the product that is the result of multiplying (i) the aggregate quantity of Licensed Compound included in Products actually sold (excluding, for the avoidance of doubt, samples and other Products transferred without consideration) in the applicable Calendar Quarter expressed in grams (“Sold Quantity”), and (ii) the applicable Transfer Price per gram;
(b) in the event of a Failure To Supply or an Insolvency Event affecting Ironwood, any costs reasonably incurred by Astellas or its Affiliates in connection with the manufacture, by Astellas, its Affiliates, or a Third Party, and/or procurement of Licensed Compound from a Third Party corresponding to the Sold Quantity (“Cover Costs”); provided that such Cover Costs may only be deducted from royalties due hereunder if Astellas has complied with the provisions of Section 3.4 hereof requiring Astellas to consult with Ironwood and reasonably consider Ironwood’s comments regarding the Manufacture of Licensed Compound following Ironwood’s failure to supply;
(c) in the event of a Manufacturing Cessation, in lieu of any deduction pursuant Sections 4.3.2(a) and 4.3.2(b), the higher of (i) Astellas’s Cover Costs, or (ii) an amount equal to the product that is the result of [**] = Portions of this exhibit have been omitted pursuant to a confidential treatment request. An unredacted version of this exhibit has been filed separately with the Commission. multiplying (A) the Sold Quantity, and (B) Ironwood’s Fully Absorbed Cost per gram at such time;
(d) in the event of Patent Expiration, unless Astellas continues to procure Licensed Compound from Ironwood (in which case Astellas may continue to make deductions pursuant to Sections 4.3.2(a) and 4.3.2(b)), an amount equal to the product that is the result of multiplying (i) the Sold Quantity, and (ii) Ironwood’s Fully Absorbed Cost per gram at such time;
(e) any amounts owed to an Astellas Indemnified Party in accordance with the IP Indemnity set forth in Section 9.1; it being understood that any such amounts owed to an Astellas Indemnified Party are not deductible pursuant to Section 4.3.4 to the extent d...
