Common use of Additional Royalties Clause in Contracts

Additional Royalties. Within [ * ] after the end of each calendar year during the term of this Agreement, ▇▇▇▇▇ shall make any additional royalty payments that may be required by Section 4.1.2(c) to Tularik on Net Sales of Significant Market Products during such calendar year. The amount of any such additional royalties shall be determined as follows: (a) First, the amount of Net Sales of Significant Market Products shall be [ * ] "Aggregate Amount"). The portion of the Aggregate Amount allocable to [ * ] under this Agreement is the "Allocable Portion." (b) Second, [ * ] will be determined by ascertaining whether the Effective Date precedes or follows the date on which the Parties executed any license agreement (other than this Agreement) for which worldwide net sales are equal to or greater than [ * ] in any given calendar year. The net sales of products or of Significant Market Products under [ * ] shall be considered the first net sales (i.e., sales from $1 upward) and the royalty rate applicable to net sales of less than [ * ] of such product or Significant Market Product shall be [ * ] Net sales of subsequently executed agreement(s) shall be considered sales made in addition to net sales made under the earliest executed agreement. The foregoing is illustrated in the following example: [ * ]. [ * ] [ * ] [ * ] [ * ] [ * ] [ * ] [ * ] [ * ] (c) ▇▇▇▇▇ shall pay to Tularik any additional royalty due pursuant to this Section 4.1.2 equal to the amount, if any, by which the amount of royalties due to Tularik with respect to the Allocable Portion determined pursuant to Section 4.1.2(a) and (b) exceeds the amount previously paid or due and payable to Tularik pursuant to Section 4.1.1.