Common use of Royalties on Net Sales of Licensed Products Clause in Contracts

Royalties on Net Sales of Licensed Products. Licensee shall pay running royalties to Licensor on the aggregate annual Net Sales of Licensed Products during the applicable Royalty Term (such Royalty Term determined on a Licensed Product-by-Licensed Product and country-by-country basis) at the applicable royalty rates set forth below: On the portion of worldwide annual Net Sales less than or equal to $[**] [**] % On the portion of worldwide annual Net Sales greater than $[**] but less than or equal to $[**] [**] % On the portion of worldwide annual Net Sales greater than $[**] [**] % The Parties acknowledge and agree that the royalty rates set forth above, and the Royalty Term during which such royalty rates will apply, have been negotiated by the Parties and take into consideration the transfer of, license to, and use of Know-How and materials, including the Licensed Compounds, in addition to licenses granted under the Licensed Patent Rights during the Royalty Term. Furthermore, the royalty rates have been specifically negotiated to remain constant during the Royalty Term, instead of having higher royalty rates when and where there is a Valid Claim within the Licensed Patent Rights.