Common use of Reduction of Royalties-Third Party Royalties Clause in Contracts

Reduction of Royalties-Third Party Royalties. In the event it becomes necessary for COMPANY or its Sublicensee, in the reasonable opinion of its counsel, to obtain a license from a third party in order to make, have made, develop, import, export, use, sell, offer for sale, have sold or otherwise exploit any Licensed Product because, except for a license granted by the third party, sale of a Licensed Product in the relevant country would infringe an intellectual property right of a third party in that country, and the cumulative royalty rate on the Licensed Product Sale in that country exceeds [insert amount%] of Net Sales, COMPANY or its Sublicensee may offset the royalty rate paid to EMORY on a Licensed Product-by-Licensed Product and country-by-country basis by up to fifty percent (50%) of the royalties paid to such third party in any calendar quarter. Notwithstanding the foregoing, however, in no event shall the royalties due to EMORY on Net Sales of such Licensed Products in any country be reduced by more than 50% of the Running Royalty Percent as identified in APPENDIX D.

Reduction of Royalties-Third Party Royalties. In the event it becomes necessary for COMPANY Licensee or its Sublicensee, in the reasonable opinion of its counsel, Sublicensee to obtain a license from a third party in order to make, have made, develop, import, export, use, sell, offer for sale, have sold or otherwise exploit any Licensed Product or Licensed Method because, except for a license granted by the third party, sale of a Licensed Product or Licensed Method in the relevant country would infringe an intellectual property right of a third party in that country, and the cumulative royalty rate on the sales of Licensed Product Sale Products or Licensed Methods in that country exceeds [insert amount%] percent (XX%) of Net Sales, COMPANY Licensee or its Sublicensee may offset the royalty rate paid to EMORY Licensor on a Licensed Product-by-Licensed Product (or Licensed Method-by-Licensed Method) and country-by-country basis by up to fifty percent (50%) of the royalties royalty rate paid to such third party in any calendar quarter. Notwithstanding the foregoing, however, in no event shall the royalties due to EMORY Licenseor on Net Sales of such Licensed Products in any country be reduced by more than 50% of the Running Royalty Percent as identified in APPENDIX D.above.