Common use of Net Sales Clause in Contracts

Net Sales. The term “Net Sales” shall mean the gross amounts invoiced by (i) Licensee or its Affiliates or Sublicensees to Third Parties on sales of Licensed Products, or (ii) Licensee or its Affiliates to Third Parties on sales of Company Products; in each case, less the following items, to the extent attributable to such sales of Products (if not previously deducted from the amount invoiced): (a) […***…]; (b) […***…]; (c) […***…]; (d) […***…]; (e) […***…]; (f) […***…]; and (g) […***…]. Net Sales shall include all consideration charged by Licensee, its Affiliate, or, solely in the case of Licensed Products, a Sublicensee (in each case, a “Selling Party”), in exchange for any Products, including without limitation any monetary payments or, with regard to any other property paid in exchange for any Products an amount in cash equal to the fair market value of such property. For purposes of determining Net Sales, a sale shall be deemed to have occurred when an invoice therefor shall be generated or the Product is shipped for delivery. Sales of Products by one Selling Party to another Selling Party for resale shall be excluded, and only the subsequent sale of such Products to unrelated parties shall be included in the calculation of Net Sales hereunder. The deductible items listed in sub-clauses (a)-(g) above shall be either (i) included as line items on the invoice, or (ii) reasonably supported by other appropriate documentation as being specifically attributable to sales of Products in accordance with United States Generally Accepted Accounting Principles (“GAAP”) or International Financing Reporting Standards (“IFRS”), as applicable, consistently applied throughout the organization of the Selling Party; and such amounts shall be included in the quarterly Royalty Reports that Licensee sends to TSRI pursuant to Section 6.3. If Licensee or another Selling Party receives refunds or reimbursements of any amounts deducted as set forth herein, then such refunded or reimbursed amounts shall be considered Net Sales in the applicable reporting period in which such refunded or reimbursed amounts are received. Products distributed as free promotional samples or in any compassionate use program, donated to non-profit institutions or government agencies, in which, in each case, no monetary or other consideration is paid to or received by the Selling Party, and Products used in research or development activities, including, without limitation, clinical trials, shall be disregarded in determining Net Sales.

Net Sales. The term “Net Sales” shall mean mean: the gross amounts invoiced amount of revenue actually received by Licensee or its Affiliate(s), during any specified period in accordance with GAAP for the sale, transfer, or other disposition of a Licensed Product, less the following deductions to the extent applicable to such amounts: (i) Licensee all trade, cash and quantity credits, discounts, rebates or its Affiliates refunds; (ii) credits or Sublicensees allowances for returns, billing errors, damaged, outdated or recalled Licensed Products, in each case during such period; and (iii) packaging costs, handling fees, insurance and prepaid freight, sales taxes, duties and other governmental charges (including value- added tax), but excluding what is commonly known as income taxes; provided that if a Licensed Product is so sold or otherwise transferred for a single price in the form of a Combination Product, Net Sales shall be further calculated pursuant to Third Parties on Section 1.16(b) below; Notwithstanding the foregoing, in the event that, in any given Calendar Quarter, a Licensed Product is sold as part of a Combination Product, the amount of revenue received for such Licensed Product shall be calculated by multiplying the revenue received for such Combination Product by the fraction A/(A+B) where “A” is the average revenue received for such Licensed Product(s) sold separately during such Calendar Quarter, and “B” is the average revenue received for the other items included in such Combination Product sold separately during such Calendar Quarter. In the event that such separate sales of components in a Combination Product were not made or performed during the applicable Calendar Quarter, then the amount of revenue received for a Licensed ProductsProduct that is sold as part of a Combination Product shall be calculated by multiplying the amount of revenue received for the Combination Product by *** percent (***%). The parties agree that any allocation of revenue from the sale or other disposition of Combination Products pursuant to this Section 1.16(b) shall be done in good faith, and shall take into consideration revenue recognition guidance under GAAP which is applicable to multiple-deliverable revenue arrangements. Net Sales shall not include sales between or among Licensee and its Affiliate; provided that if Licensee sells a Licensed Product to an Affiliate for resale, Net Sales shall include sales by such Affiliate in accordance with GAAP in connection with the resale of such Licensed Product to a Third Party. Notwithstanding anything else in this in this section, the supply or other disposition of Licensed Products without charge as (i) samples, or (ii) Licensee for use in any tests or its Affiliates studies reasonably necessary to Third Parties on sales of Company Products; in each casecomply with any applicable law, less the following items, to the extent attributable to such sales of Products (if not previously deducted from the amount invoiced): (a) […***…]; (b) […***…]; (c) […***…]; (d) […***…]; (e) […***…]; (f) […***…]; regulation or request by a regulatory or governmental authority or as is otherwise reasonable and (g) […***…]. Net Sales shall include all consideration charged by Licensee, its Affiliate, or, solely customary in the case of Licensed Products, a Sublicensee (in each case, a “Selling Party”), in exchange for any Products, including without limitation any monetary payments or, with regard to any other property paid in exchange for any Products an amount in cash equal to the fair market value of such property. For purposes of determining Net Sales, a sale shall be deemed to have occurred when an invoice therefor shall be generated or the Product is shipped for delivery. Sales of Products by one Selling Party to another Selling Party for resale shall be excluded, and only the subsequent sale of such Products to unrelated parties shall be included in the calculation of Net Sales hereunder. The deductible items listed in sub-clauses (a)-(g) above shall be either (i) included as line items on the invoice, or (ii) reasonably supported by other appropriate documentation as being specifically attributable to sales of Products in accordance with United States Generally Accepted Accounting Principles (“GAAP”) or International Financing Reporting Standards (“IFRS”), as applicable, consistently applied throughout the organization of the Selling Party; and such amounts shall be included in the quarterly Royalty Reports that Licensee sends to TSRI pursuant to Section 6.3. If Licensee or another Selling Party receives refunds or reimbursements of any amounts deducted as set forth herein, then such refunded or reimbursed amounts shall be considered Net Sales in the applicable reporting period in which such refunded or reimbursed amounts are received. Products distributed as free promotional samples or in any compassionate use program, donated to non-profit institutions or government agencies, in whichindustry, in each case, no monetary or other consideration is paid to or received by case shall not be included within the Selling Party, and Products used in research or development activities, including, without limitation, clinical trials, shall be disregarded in determining computation of Net Sales.

Net Sales. The term “"Net Sales” " shall mean the gross total amount invoiced to third parties on sales of Licensed Products by Licensee, its Affiliates, or Sublicensees, for which royalties are due under Article 3 below, less the following reasonable and customary deductions to the extent applicable to such invoiced amounts: (i) all trade, cash and quantity credits, discounts, refunds or government rebates; (ii) amounts for claims, allowances or credits for returns, retroactive price reductions, or chargebacks; (iii) packaging, handling fees and prepaid freight, sales taxes, duties and other governmental charges (including value added tax); and (iv) provisions for uncollectible accounts determined in accordance with reasonable accounting practices, consistently applied to all products of the selling party; provided, however, that in the case of Patient-Specific Licensed Products, "Net Sales" shall equal thirty percent (30%) of the foregoing amounts (after the deductions described in (i) through (iv) above). For purposes of the foregoing, it is understood that Net Sales shall include only the amount invoiced for materials consisting of Licensed Products (less the foregoing deductions and adjustments) and shall not include charges related to services (other than cell separation and expansion) performed in connection with the sale of such Licensed Products; accordingly, Net Sales shall not include, without limitation, charges for apheresis, reinfusion, surgical procedures, hospital stays or the like. For the removal of doubt, Net Sales shall not include sales by Licensee to its Affiliates for resale, provided that if Licensee sells a Licensed Product to an Affiliate for resale, Net Sales shall include the amounts invoiced by (i) such Affiliate to third parties on the resale of such Licensed Product. In the event that Licensee or its Affiliates or Sublicensees to Third Parties on grants a sublicense hereunder, and receives payments based upon the Sublicensee's sales of Licensed Products, or (ii) Licensee or its Affiliates may upon approval by Scripps, which approval shall not be unreasonably withheld, substitute the definition of "Net Sales," used by the Sublicensee to Third Parties on sales calculate payments to Licensee in place of Company Products; in each case, less the following items, to the extent attributable to such sales foregoing definition of Products (if not previously deducted from the amount invoiced): (a) […***…]; (b) […***…]; (c) […***…]; (d) […***…]; (e) […***…]; (f) […***…]; and (g) […***…]. "Net Sales shall include all consideration charged by Licensee, its Affiliate, or, solely in the case of Licensed Products, a Sublicensee (in each case, a “Selling Party”), in exchange Sales" for any Products, including without limitation any monetary payments or, with regard to any other property paid in exchange for any Products an amount in cash equal to the fair market value of such property. For purposes of determining Net Sales, a sale shall be deemed calculating royalties payable to have occurred when an invoice therefor shall be generated or the Product is shipped for delivery. Sales of Products by one Selling Party to another Selling Party for resale shall be excluded, and only the subsequent sale of Scripps on such Products to unrelated parties shall be included in the calculation of Net Sales hereunder. The deductible items listed in sub-clauses (a)-(g) above shall be either (i) included as line items on the invoice, or (ii) reasonably supported by other appropriate documentation as being specifically attributable to sales of Products in accordance with United States Generally Accepted Accounting Principles (“GAAP”) or International Financing Reporting Standards (“IFRS”), as applicable, consistently applied throughout the organization of the Selling Party; and such amounts shall be included in the quarterly Royalty Reports that Licensee sends to TSRI pursuant to Section 6.3. If Licensee or another Selling Party receives refunds or reimbursements of any amounts deducted as set forth herein, then such refunded or reimbursed amounts shall be considered Net Sales in the applicable reporting period in which such refunded or reimbursed amounts are received. Products distributed as free promotional samples or in any compassionate use program, donated to non-profit institutions or government agencies, in which, in each case, no monetary or other consideration is paid to or received by the Selling Party, and Products used in research or development activities, including, without limitation, clinical trials, shall be disregarded in determining Net SalesSublicensee's sales.

Net Sales. The term “"Net Sales” " shall mean the gross total amount invoiced to third parties on sales of Licensed Products by Licensee, its Affiliates, or Sublicensees, for which royalties are due under Article 3 below, less the following reasonable and customary deductions to the extent applicable to such invoiced amounts: (i) all trade, cash and quantity credits, discounts, refunds or government rebates; (ii) amounts for claims, allowances or credits for returns, retroactive price reductions, or chargebacks; (iii) packaging, handling fees and prepaid freight, sales taxes, duties and other governmental charges (including value added tax); and (iv) provisions for uncollectible accounts determined in accordance with reasonable accounting practices, consistently applied to all products of the selling party; provided, however, that in the case of Patient-Specific Licensed Products, "Net Sales" shall equal [* ] of the foregoing amounts (after the deductions described in (i) through (iv) above). For purposes of the foregoing, it is understood that Net Sales shall include only the amount invoiced for materials consisting of Licensed Products (less the foregoing deductions and adjustments) and shall not include charges related to services (other than cell separation and expansion) performed in connection with the sale of such Licensed Products; accordingly, Net Sales shall not include, without limitation, charges for apheresis, reinfusion, surgical procedures, hospital stays or the like. For the removal of doubt, Net Sales shall not include sales by Licensee to its Affiliates for resale, provided that if Licensee sells a Licensed Product to an Affiliate for resale, Net Sales shall include the amounts invoiced by (i) such Affiliate to third parties on the resale of such Licensed Product. In the event that Licensee or its Affiliates or Sublicensees to Third Parties on grants a sublicense hereunder, and receives payments based upon the Sublicensee's sales of Licensed Products, or (ii) Licensee or its Affiliates may upon approval by Scripps, which approval shall not be unreasonably withheld, substitute the definition of "Net Sales," used by the Sublicensee to Third Parties on sales calculate payments to Licensee in place of Company Products; in each case, less the following items, to the extent attributable to such sales foregoing definition of Products (if not previously deducted from the amount invoiced): (a) […***…]; (b) […***…]; (c) […***…]; (d) […***…]; (e) […***…]; (f) […***…]; and (g) […***…]. "Net Sales shall include all consideration charged by Licensee, its Affiliate, or, solely in the case of Licensed Products, a Sublicensee (in each case, a “Selling Party”), in exchange Sales" for any Products, including without limitation any monetary payments or, with regard to any other property paid in exchange for any Products an amount in cash equal to the fair market value of such property. For purposes of determining Net Sales, a sale shall be deemed calculating royalties payable to have occurred when an invoice therefor shall be generated or the Product is shipped for delivery. Sales of Products by one Selling Party to another Selling Party for resale shall be excluded, and only the subsequent sale of Scripps on such Products to unrelated parties shall be included in the calculation of Net Sales hereunder. The deductible items listed in sub-clauses (a)-(g) above shall be either (i) included as line items on the invoice, or (ii) reasonably supported by other appropriate documentation as being specifically attributable to sales of Products in accordance with United States Generally Accepted Accounting Principles (“GAAP”) or International Financing Reporting Standards (“IFRS”), as applicable, consistently applied throughout the organization of the Selling Party; and such amounts shall be included in the quarterly Royalty Reports that Licensee sends to TSRI pursuant to Section 6.3. If Licensee or another Selling Party receives refunds or reimbursements of any amounts deducted as set forth herein, then such refunded or reimbursed amounts shall be considered Net Sales in the applicable reporting period in which such refunded or reimbursed amounts are received. Products distributed as free promotional samples or in any compassionate use program, donated to non-profit institutions or government agencies, in which, in each case, no monetary or other consideration is paid to or received by the Selling Party, and Products used in research or development activities, including, without limitation, clinical trials, shall be disregarded in determining Net SalesSublicensee's sales.

Net Sales. The term “Net Sales” shall mean the gross amounts amount invoiced by (i) Licensee or Licensee, its Affiliates or Sublicensees its Sublicensees, or any of them (in each case, a “Selling Party”), to Third Parties on all sales of Licensed Products, less (a) discounts actually granted or allowed; (iib) Licensee credits or its Affiliates allowances for claims, allowances, retroactive price reductions, or rejected or returned goods; (c) rebates and chargebacks granted or allowed to Third Parties on sales managed health care organizations, [***], pharmacy benefit managers (or equivalents thereof), national, state/provincial, local, and other governments and their agencies, and purchasers and reimbursers, or to trade customers; (d) transportation charges for the delivery of Company Products, including handling charges and insurance premiums relating thereto; in each case(e) sales, less the following itemsuse, excise or value added taxes (except for any value added taxes that are reimbursable or reimbursed to the extent attributable to such Selling Party) actually paid in connection with sales of Products (if not previously deducted from the amount invoiced): (a) […***…]; (b) […***…]; (c) […***…]; (d) […***…]; (e) […***…]but excluding what are commonly known as income taxes or gross receipt taxes); (f) […***…]duties imposed and paid on the import of Products for sale; and (g) a reasonable allowance for bad debts directly attributable to sales of Products, provided that such allowance shall not exceed […***…]] of Net Sales amounts for the applicable reporting period. Licensee agrees to use, and to cause its Affiliates to use, commercially reasonable efforts to collect and enforce such bad debts from the debtors. Net Sales shall include all consideration charged by Licensee, its Affiliate, or, solely in the case of Licensed Products, a Sublicensee (in each case, a “Selling Party”), Affiliates or Sublicensees in exchange for any Products, including without limitation any monetary payments or, with regard to any other property paid in exchange for any Products Products, an amount in cash equal to the fair market value of such property. For purposes of determining Net Sales, a sale shall be deemed to have occurred when an invoice therefor shall be is generated or the Product is shipped for delivery. Sales of Products by one Selling Party to another Selling Party for resale shall be excluded, and only the subsequent sale of such Products to unrelated parties shall be included in the calculation of Net Sales hereunder. Notwithstanding the foregoing, Products used in any clinical, pre-clinical or non-clinical research or development activities, donated to non-profit institutions or government agencies, or provided in a sampling program or compassionate use program, in each case in which no monetary or other consideration is paid to or received by Licensee, its Affiliates or any Sublicensee, shall be disregarded in determining Net Sales. The deductible items listed in sub-clauses (a)-(g) above shall be either (i) included as line items on in the invoice, or (ii) reasonably supported by other appropriate documentation as being specifically attributable to actual sales of Products in accordance with United States U.S. Generally Accepted Accounting Principles Standards (“GAAP”) or International Financing Reporting Standards (“IFRS”), as applicable, consistently applied throughout the organization of the Selling Party; ., and such amounts the deductible item listed in sub-clause (g) above shall be included taken in accordance with GAAP or IFRS, as applicable, consistently applied throughout the quarterly Royalty Reports that Licensee sends to TSRI pursuant to Section 6.3organization of the Selling Party. If Licensee or another the Selling Party receives refunds or reimbursements of any amounts deducted as set forth herein, then such refunded or reimbursed amounts shall be considered Net Sales in the applicable reporting period in which such refunded or reimbursed amounts are received. Products distributed as free promotional samples or in any compassionate use program, donated to non-profit institutions or government agencies, in which, in each case, no monetary or other consideration is paid to or received by the Selling Party, and Products used in research or development activities, including, without limitation, clinical trials, shall be disregarded in determining Net Sales.

Net Sales. The term “Net Sales” shall mean For the purposes of this Section 8.3, net sales means, in any case where a Licensor Improvement Product is sold or commercially disposed of for value by Licensor or any sublicensee of Licensor in an arm's length transaction with a third party (other than an Affiliate of Licensor or sublicensee of Licensor), the gross amounts invoiced by invoice price for such Licensor Improvement Product, less the following: (i) Licensee discounts, chargebacks, Medicare or its Affiliates other [*] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES AND EXCHANGE ACT OF 1934, AS AMENDED. government rebates, and rebates to purchasers actually taken or Sublicensees to Third Parties on sales of Licensed Products, or allowed; (ii) Licensee credits or its Affiliates to Third Parties on sales allowances given or made for rejections or return of Company Productsany previously sold products actually taken or allowed; in each case, less the following items, (iii) to the extent attributable to included in such sales of Products (if not previously deducted from gross invoice price any tax or government charge imposed on the amount invoiced): (a) […***…]; (b) […***…]; (c) […***…]; (d) […***…]; (e) […***…]; (f) […***…]; and (g) […***…]. Net Sales shall include all consideration charged by Licenseeproduction, its Affiliateimport, orexport, solely in the case of Licensed Productssale, a Sublicensee (in each case, a “Selling Party”), in exchange for any Products, including without limitation any monetary payments or, with regard to any other property paid in exchange for any Products an amount in cash equal to the fair market value delivery or use of such property. For purposes of determining Net Sales, a sale shall be deemed to have occurred when an invoice therefor shall be generated or the Product is shipped for delivery. Sales of Products by one Selling Party to another Selling Party for resale shall be excluded, and only the subsequent sale of such Products to unrelated parties shall be included in the calculation of Net Sales hereunder. The deductible items listed in sub-clauses (a)-(g) above shall be either (i) included as line items on the invoice, or (ii) reasonably supported by other appropriate documentation as being specifically attributable to sales of Products in accordance with United States Generally Accepted Accounting Principles (“GAAP”) or International Financing Reporting Standards (“IFRS”), as applicable, consistently applied throughout the organization of the Selling Party; and such amounts shall be included in the quarterly Royalty Reports that Licensee sends to TSRI pursuant to Section 6.3. If Licensee or another Selling Party receives refunds or reimbursements of any amounts deducted as set forth herein, then such refunded or reimbursed amounts shall be considered Net Sales in the applicable reporting period in which such refunded or reimbursed amounts are received. Products distributed as free promotional samples or in any compassionate use program, donated to non-profit institutions or government agencies, in which, in each case, no monetary or other consideration is paid to or received by the Selling Party, and Products used in research or development activitiesproducts, including, without limitation, clinical trialsany value added or similar tax or government charge, but not including any tax levied with respect to income; and (iv) to the extent included in such gross invoice price any reasonable and documented packaging and distribution charges. Net sales shall also include and be deemed to have been made with respect to (A) any Licensor Improvement Product not sold or otherwise transferred to any third party but rather used by Licensor to provide a commercial service and (B) any other transfer of a Licensor Improvement Product for less than arm's length value other than intercompany transfers where the transferee is not the end user. The amount of any net sale as defined in the preceding sentence shall be disregarded imputed using the price or prices at which the Licensor Improvement Product at issue is then being sold in determining Net Salestransactions covered by the first sentence of this Section or, if no such transactions have occurred, on a reasonable basis to be determined at the time by the Parties. Notwithstanding any other provision of this Section, net sales shall not include the transfer without consideration of any Licensor Improvement Product by Licensor (x) for use in any clinical trial or in any preclinical or other research, (y) as detailing samples or other use to promote additional net sales in amounts consistent with the normal business practices of Licensor, or (z) for compassionate use.

Net Sales. The term “Net SalesNET SALES” shall mean the gross amounts invoiced GROSS SALES for SALES of LICENSED PRODUCTS by (i) Licensee LICENSEE or its Affiliates AFFILIATES or Sublicensees SUBLICENSEES to Third Parties on sales of Licensed Products, or (ii) Licensee or its Affiliates to Third Parties on sales of Company Products; in each case, any third party less the following items, deductions from such GROSS SALES to the extent attributable to such sales LICENSED PRODUCTS and to the extent actually incurred, allowed, accrued or specifically allocated: (i) Costs of Products Goods Sold (if COGS), normal and customary trade, cash and quantity discounts actually given, credits, refunds, price adjustments or allowances actually granted customers including damaged LICENSED PRODUCTS, returns or rejections of LICENSED PRODUCTS, provided, however, that deductions taken for bad debt shall not previously deducted from the amount invoiced): (a) exceed in aggregate […***…]; ] percent (b) […***…]%) of GROSS SALES of SUBJECT TECHNOLOGIES AND LICENSED PRODUCTS during the calendar quarter; (ii) reasonable and customary freight, shipping, and other transportation charges directly related to the Sale of the LICENSED PRODUCTS and separately stated and included on the invoice to the third party; and (ciii) […***…]; (d) […***…]; (e) […***…]; (f) […***…]; sales, value added, excise taxes, tariffs and (g) […***…]. Net Sales shall include all consideration charged by Licenseeduties, its Affiliateand other taxes and government charges directly related to the sale, or, solely to the extent that such items are included in the case gross invoice price of Licensed Productsthe LICENSED PRODUCTS and actually borne by LICENSEE or its AFFILIATES, SUBLICENSEES or distributors without reimbursement from any third party (but not including taxes assessed against the income derived from such sale); all as determined in accordance with U.S. GAAP and on a Sublicensee basis consistent with LICENSEE’s annual audited financial statements. (iv) Notwithstanding any provision in each casethis Agreement to the contrary, NET SALES shall not include the use of SUBJECT TECHNOLOGY by any AFFILIATE or SUBLICENSEE for non-commercial research purposes. (v) In the event that LICENSED PRODUCTS are leased or exchanged for consideration other than money, the GROSS SALE price shall be the average GROSS SALE price received from third parties during the same quarter; in the event no data exists for said quarter, then the GROSS SALE price shall be the immediately preceding Sale of a “Selling Party”), in exchange for any Products, including without limitation any monetary payments or, with regard to any other property paid in exchange for any Products an amount in cash equal to LICENSED PRODUCT within the past six (6) months of said quarter or the fair market value of the LICENSED PRODUCT as mutually agreed between the PARTIES. (vi) The PARTIES agree that upon obtaining prior written approval of WVURC, such property. For purposes approval which shall not unreasonably be withheld, none of: (x) the free use of determining Net Sales, LICENSED PRODUCTS in a sale shall be deemed to have occurred when an invoice therefor shall be generated preclinical or the Product is shipped for delivery. Sales of Products by one Selling Party to another Selling Party for resale shall be excluded, and only the subsequent sale of such Products to unrelated parties shall be included in the calculation of Net Sales hereunder. The deductible items listed in sub-clauses (a)-(g) above shall be either (i) included as line items on the invoiceclinical trial, or (iiy) reasonably supported by other appropriate documentation as being specifically attributable to sales use of Products in accordance with United States Generally Accepted Accounting Principles (“GAAP”) or International Financing Reporting Standards (“IFRS”), as applicable, consistently applied throughout the organization of the Selling Party; and such amounts shall be included in the quarterly Royalty Reports that Licensee sends to TSRI pursuant to Section 6.3. If Licensee or another Selling Party receives refunds or reimbursements of any amounts deducted as set forth herein, then such refunded or reimbursed amounts shall be considered Net Sales in the applicable reporting period in which such refunded or reimbursed amounts are received. Products distributed LICENSED PRODUCTS as free promotional samples marketing samples, or in any compassionate use program, donated (z) the donation at no-cost of LICENSED PRODUCTS by LICENSEE and/or its AFFILIATES to a non-profit institutions third party charitable organization in connection with donations for charitable, compassionate use or government agenciesexpanded access program purposes will be considered a Sale for purposes of calculating any amounts due to WVURC as NET SALES hereunder, so long as the transfer of said LICENSED PRODUCTS as described in which(x), in each case, no monetary or other consideration is paid to or received by the Selling Party(y), and Products used in research (z) does not collectively exceed [***]% ([***] Percent) of total units of LICENSED PRODUCTS transferred, sold, or development activitiesconveyed to a third party during a calendar year (example: if [***] units of LICENSED PRODUCTS are sold during a single calendar year, includingthe collective total of (x), without limitation(y), clinical trials, and (z) shall be disregarded no more than [***] units), unless as otherwise agreed in determining Net Saleswriting by authorized representatives of the PARTIES.

Net Sales. The term “phrase Net Sales” Sales shall mean the gross amounts invoiced for End Products by members of the RMS Group to purchasers and other transferees after deduction of volume discounts, sales rebates, reimbursements for returns, and sales taxes (ie.g., value added taxes) Licensee and other taxes directly linked to the sales (provided that such taxes are invoiced to and paid by such purchasers or its Affiliates or Sublicensees other transferees), but excluding discounts, rebates, price reductions and/or credits to Third Parties customers on sales account of Licensed Products, or (ii) Licensee or its Affiliates to Third Parties on sales settlement of Company Products; in each casecomplaints, less the following items, to the extent attributable to such sales of Products (if not previously deducted from deductions for. a) "Sales Expenses" in the amount invoiced): (a) of […***…]; ] percent (b) […***…]%), provided that this percentage shall be reduced in accordance with each general reduction by RMS of such Sales Expenses in connection with the calculation of royalties payable with respect to the sale of diagnostic kits; (cb) "Reagent Rental Deduction" in the amount of […***…]; ] percent (d) […***…]; (e) […***…]; (f) […***…]%), provided that this percentage shall be reduced in accordance with each general reduction by RMS of such Reagent Rental Deductions in connection with the calculation of royalties payable with respect to the sale of diagnostic kits; and (gc) […***…]deductions for "Third Party Royalty Expenses". Net Sales shall include all consideration charged by Licenseebe determined from the books and records of RMS and its Affiliates. In the event that an End Product is sold together with one or more other product(s) at a single price (a "Combination Product"), its Affiliatesuch single price shall be allocated among the End Product(s) and the other product(s) in the Combination Product based upon the relevant market prices for such products when sold separately. If any such product is not sold separately, RGI and RMS shall in good faith discuss and agree upon a fair market price for that product and that price shall be used to calculate the Net Sales. When End Products are not sold, or are not sold and itemized separately, but are otherwise transferred or sold together with one or more other products as part of a sales transaction, the Net Sales of such End Products shall be calculated according to their sale prices when sold separately, or, solely if there are no such prices, then according to the average of prices at which products of the most similar kind and quality, sold in the case of Licensed Productssimilar quantities, are then being offered for sale by RMS and/or its Affiliates. If a Sublicensee (in each caseselling price cannot thus be determined, a “Selling Party”), in exchange for any Products, including without limitation any monetary payments or, with regard to any other property paid in exchange for any Products an amount in cash equal to then it shall be the fair market value of such property. For purposes of determining Net Sales, a sale shall be deemed to have occurred when an invoice therefor shall be generated or the End Product is shipped for delivery. Sales of Products by one Selling Party to another Selling Party for resale shall be excluded, and only the subsequent sale of such Products to unrelated parties shall be included in the calculation of Net Sales hereunder. The deductible items listed in sub-clauses (a)-(g) above shall be either (i) included as line items on the invoice, or (ii) reasonably supported by other appropriate documentation as being specifically attributable to sales of Products in accordance with United States Generally Accepted Accounting Principles (“GAAP”) or International Financing Reporting Standards (“IFRS”), as applicable, consistently applied throughout the organization of the Selling Party; and such amounts shall be included in the quarterly Royalty Reports that Licensee sends to TSRI pursuant to Section 6.3. If Licensee or another Selling Party receives refunds or reimbursements of any amounts deducted as set forth herein, then such refunded or reimbursed amounts shall be considered Net Sales in the applicable reporting period in which such refunded or reimbursed amounts are received. Products distributed as free promotional samples or in any compassionate use program, donated to non-profit institutions or government agencies, in which, in each case, no monetary or other consideration is paid to or received by the Selling Party, and Products used in research or development activities, including, without limitation, clinical trials, shall be disregarded in determining Net Salesquestion.