Common use of Royalty Credit Clause in Contracts

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 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 * Confidential Information, indicated by [***], has been omitted from this filing and filed separately with the Securities and Exchange Commission 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 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.. * Confidential Information, indicated by [***], has been omitted from this filing and filed separately with the Securities and Exchange Commission