“Affected Territory” means any country, or any geographic area within a country, in which there is an Outbreak or for which there is an Increased Outbreak Preparation Need. For clarity, the Affected Territory includes any country in Awardee’s Traveler’s Market and any Non-Traveler’s Market Countries, in each case in which there is an Outbreak or for which there is an Increased Outbreak Preparation Need.
“Awardee’s Traveler’s Market” means those countries listed below [redacted] and any country that is defined by the Organization for Economic Co-operation and Development from time to time as a high income country; provided that if any such country becomes an LMIC [Low and Middle Income Countries], such country will no longer be included in the Awardee’s Traveler’s Market and will become a Non-Traveler’s Market Country.
“Increased Outbreak Preparation Need” means when, having considered all reasonably accessible and relevant information including epidemiological data, travel and migration patterns and the likely availability of other products or product candidates, CEPI determines, in its sole discretion in consultation with experts (for example a sub-group or subcommittee of CEPI’s Scientific Advisory Committee that CEPI determines has appropriate expertise), that there is a heightened need for the Product to address potential Outbreaks.
“Net Sales” means the gross amount invoiced or received by Awardee, its Affiliates, licensees or assignees in respect of sales of Product to third party purchasers in bona fide arm’s length transactions less [***], booked on an accrual basis pursuant to Generally Accepted Accounting Principles (GAAP) or International Financial Reporting Standards (IFRS), as relevant.
15. Sharing of Commercial Benefits
15.1 Sharing of Commercial Benefits. CEPI has committed to its own funders to obtain a share of Awardee’s Commercial Benefits as a contribution to support CEPI’s programme activities.
15.2 The Awardee will: make the following contributions to CEPI in recognition of the Commercial Benefits that Awardee will receive from its sale of the Products:
a. Until the rolling safety stock has been established by Awardee in accordance with Clause 15.2(ii), Awardee will make available to CEPI, at Awardee’s cost, any Investigational Product which is not needed by Awardee for Awardee’s Investigational Product lot-to-lot clinical trial(s).
b. Within [***] of receipt of marketing approval for the Product from the FDA, Awardee will produce, at Awardee’s own cost, a [***] safety stock comprised of not less than two hundred thousand (200,000) doses of final Drug Product. For clarity, Awardee will use commercially reasonable best efforts to keep such deadline of [***], however, it will be subject to the lead times of Awardee`s contract manufacturers and the time required for the release testing of the Product. Awardee may use such safety stock to supply the Awardee’s Traveler’s Market and will replenish such stock on a rolling basis at Awardee’s cost. The stock in paragraph 15.2(i) and this paragraph 15.2(ii) is referred to as (“Safety Stock”).
c. In case of an Outbreak or Increased Outbreak Preparation Need, CEPI may utilize such Safety Stock in the Affected Territory by giving notice in writing to Awardee and Awardee will dispatch all or some only of the Safety Stock, as instructed by CEPI and CEPI shall pay any reasonable costs incurred in connection with the utilization of the Safety Stock, including but not limited to transportation, distribution and storage in the Affected Territory. For clarity, Awardee shall make no charge for the supply of the Safety Stock allocated to and used by CEPI in accordance with this paragraph 15.2 (iii) and the storage costs of such Safety Stock, incurred prior to dispatch to the Affected Territory, shall be borne by Awardee. d. If the Safety Stock is used by CEPI in the case of an Outbreak or Increased Outbreak Preparation Need, CEPI or such third parties as CEPI may nominate shall be responsible for the costs of transportation of such Safety Stock from Awardee’s facility. If, following the use of the Safety Stock as directed by CEPI, CEPI wishes to replenish the Safety Stock, Awardee shall produce such quantities of Product as are required to replenish the Safety Stock and CEPI shall pay Awardee for the costs of the production of such Product.
15.3 Awardee Milestone Payments. Awardee shall pay to CEPI the following milestone payments:
a. [***] within [***] of the date of achievement by Awardee of Net Sales of the Product in the United States of America of, [***];
b. [***] within [***] of the date of achievement by Awardee of Net Sales of the Product in the United States of America of, [***];
c. [***] within [***] of the date of achievement by Awardee of Net Sales of the Product in the EU of, [***];
d. [***] within [***] of the date of achievement by Awardee of Net Sales of the Product in the EU of, [***];
e. if Awardee is [***] as a result of its development of the Product, [***] on the first to occur of: (x) [***]; and (y) [***].
15.4 Currency conversion. Where calculation of milestone payments due under this Agreement requires the conversion to US dollars of Net Sales generated in any other currency, the following shall apply. As Awardee reports Euro Net Sales in the group financial statements (all currencies converted into Euro according to the International Financial Reporting Standards), these amounts from the group financial statements will be converted using the annual average rate as quoted by the European Central Bank on the website http://sdw.ecb.europa.eu/.
15.5 Awardee shall keep, and cause its Affiliates and sublicensees to keep, complete and accurate records relating to all Net Sales and by [***] in each year following launch of the Product, shall provide CEPI with a report setting out the amount of Net Sales made in the previous calendar year. CEPI shall, upon reasonable notice to Awardee, be entitled to send an independent auditor at CEPI`s cost, who shall be under obligations of confidentiality no less onerous than those set out in this Agreement, to access and review all documents, information, data and materials in the possession of Awardee directly relating to the calculation of Net Sales. If the review of such records reveals that Awardee has failed to accurately report information pursuant to this Clause 15.5 or to make any payment (or portion thereof) required under this Clause 15.5, then Awardee shall pay, within [***] after receipt of a written request, any underpaid amounts due under this Clause 15.5 together with interest thereon applied to the period from the date the amount should have been paid to the date it is actually paid at an interest rate equal to [***]. In the event the review reveals an underpayment of [***] or more of the amounts due under this Clause 15.5, Awardee shall pay all reasonable costs incurred in conducting such review. In the event the review reveals an underpayment of less than [***], then all costs incurred in conducting such review shall be borne by CEPI.