Common use of Royalty Offset Clause in Contracts

Royalty Offset. RPRP and Introgen understand and recognize that RPRP is a party to consulting, license and/or research funding agreements (but not agreements where third party non-government investors finance the research or development of technology for RPRP) with other commercial and research institutions ("collaborators") which agreements provide for RPRP's payment of royalties on products manufactured, used or sold by RPRP based on the contribution of said collaborators to the discovery and development of said products. Consequently, it is foreseeable that a Collaboration Product developed with Introgen may become subject to multiple royalty obligations as the result of more than one collaborator's contribution to the development of, or ownership of patent rights covering, the Collaboration Product. In order to avoid the development of a dispute over royalty entitlements and to provide RPRP with the incentive to invest in and commercialize products which might otherwise not be commercialized due to excess royalty obligations, RPRP and Introgen agree that the royalty rates applicable to any specific Collaboration Product pursuant to the first sentence of Section 8.1 (the "Introgen Royalty") or pursuant to an agreement with a third party collaborator not an Affiliate at the time of agreement or the payment of a royalty (the "Third Party Royalties") may be reduced to provide reasonable royalty income to each contributing collaborator. RPRP shall make reasonable and diligent efforts to establish agreements and amend its existing royalty-bearing agreements with said collaborators so as to ensure the fair distribution of royalty income based on Collaboration Products for which more than one royalty claim is made, provided the Introgen Royalty paid to Introgen shall in no event be adjusted to [*] on a country by country basis (notwithstanding any other provision of this Agreement). It is understood that this Section shall not be invoked by RPRP as regards Introgen until the sum of the Introgen Royalty and Third Party Royalties payable by RPRP for a Collaboration Product ("Total Royalty") is greater than [*] on a country by country basis. Thereafter, royalty reduction shall be applied equitably in accordance with the formula in this Section 8.2, taking into account each collaborator's minimum royalty rate, to reduce on a percentage basis the royalty rates specified in all collaborator agreements having an applicable royalty adjustment provision therein and thereby adjust, to the extent possible, RPRP's Total Royalty burden to no more than [*] on a country by country basis.

Royalty Offset. RPRP and Introgen understand and recognize that RPRP is a party to consulting, license and/or research funding agreements (but not agreements where third party non-government investors finance the research or development of technology for RPRP) with other commercial and research institutions ("collaborators") which agreements provide for RPRP's payment of royalties on products manufactured, used or sold by RPRP based on the contribution of said collaborators to the discovery and development of said products. Consequently, it is foreseeable that a Collaboration Product developed with Introgen may become subject to multiple royalty obligations as the result of more than one collaborator's contribution to the development of, or ownership of patent rights covering, the Collaboration Product. In order to avoid the development of a dispute over royalty entitlements and to provide RPRP with the incentive to invest in and commercialize products which might otherwise not be commercialized due to excess royalty obligations, RPRP and Introgen agree that the royalty rates applicable to any specific Collaboration Product pursuant to the first sentence of Section 8.1 (the "Introgen Royalty") or pursuant to an agreement with a third party collaborator not an Affiliate at the time of agreement or the payment of a royalty (the "Third Party Royalties") may be reduced to provide reasonable royalty income to each contributing collaborator. RPRP shall make reasonable and diligent efforts to establish agreements and amend its existing royalty-bearing agreements with said collaborators so as to ensure the fair distribution of royalty income based on Collaboration Products for which more than one royalty claim is made, provided the Introgen Royalty paid to Introgen shall in no event be adjusted to [*] on a country by country basis (notwithstanding any other provision of this Agreement). It is understood that this Section shall not be invoked by RPRP as regards Introgen until the sum of the Introgen Royalty and Third Party Royalties payable by RPRP for a Collaboration Product ("Total Royalty") is greater than [*] on a country by country basis. Thereafter, royalty reduction shall be applied equitably in accordance with the formula in this Section 8.2, taking into account each collaborator's minimum royalty rate, to reduce on a percentage basis the royalty rates specified in all collaborator agreements having an applicable royalty adjustment provision therein and thereby adjust, to the extent possible, RPRP's Total Royalty burden to no more than [*] on a country by country basis.

Royalty Offset. RPRP and Introgen understand and recognize that RPRP is a party to consulting, license and/or research funding agreements (but not agreements where third party non-government investors finance the research or development of technology for RPRP) with other commercial and research institutions ("collaborators") which agreements provide for RPRP's payment of royalties on products manufactured, used or sold by RPRP based on the contribution of said collaborators to the discovery and development of said products. Consequently, it is foreseeable that a Collaboration Product developed with Introgen may become subject to multiple royalty obligations as the result of more than one collaborator's contribution to the development of, or ownership of patent rights covering, the Collaboration Product. In order to avoid the development of a dispute over royalty entitlements and to provide RPRP with the incentive to invest in and commercialize products which might otherwise not be commercialized due to excess royalty obligations, RPRP and Introgen agree that the royalty rates applicable to any specific Collaboration Product pursuant to the first sentence of Section 8.1 (the "Introgen Royalty") or pursuant to an agreement with a third party collaborator not an Affiliate at the time of agreement or the payment of a royalty (the "Third Party Royalties") may be reduced to provide reasonable royalty income to each contributing collaborator. RPRP shall make reasonable and diligent efforts to establish agreements and amend its existing royalty-bearing agreements with said collaborators so as to ensure the fair distribution of royalty income based on Collaboration Products for which more than one royalty claim is made, provided the Introgen Royalty paid to Introgen shall in no event be adjusted to [*] on a country by country basis (notwithstanding any other provision of this Agreement). It is understood that this Section shall not be invoked by RPRP as regards Introgen until the sum of the Introgen Royalty and Third Party Royalties payable by RPRP for a Collaboration Product ("Total Royalty") is greater than [*] Certain information on a country by country basis. Thereafter, royalty reduction shall be applied equitably in accordance this page has been omitted and filed separately with the formula in this Section 8.2, taking into account each collaborator's minimum royalty rate, to reduce on a percentage basis the royalty rates specified in all collaborator agreements having an applicable royalty adjustment provision therein and thereby adjust, Commission. Confidential treatment has been requested with respect to the extent possible, RPRP's Total Royalty burden to no more than [*] on a country by country basisomitted portions.