Provision Language
Definitions
“Net Sales” means, with respect to the Product, the gross amount invoiced on sales by Sublicensees to Customers in any country of the World less the following deductions, to the extent included in the sales invoice with respect to such Product:
a) normal and customary trade and quantity discounts actually given (discounts which all together cannot exceed 20% of the sales price); and, in case of returns or rejections of Products, the associated credits and price adjustments; and
b) sales, value-added, and excise taxes, tariffs, and other taxes and government charges directly related to the sale of the Product and actually borne by Sublicensees without reimbursement from any Third Party, excluding any taxes assessed against the income derived from such sale.
When the Product is included as part of any program based on multiple product offers, the discounts referred to in point a) of this section shall be consistent with the discounts applied by Sublicensees to the same Customer when the Product is not combined with any other products or services.
Use of the Product in field tests, marketing, or other similar programs or studies where Product is supplied without charge, shall not result in any Net Sales, however if Sublicensees charges for such Product, the amount billed will be included in the calculation of Net Sales.
3. ROYALTIES
MPP will require Sublicensees to pay royalties on Net Sales of Products directly to CSIC on a country-bycountry basis starting from the date of the first commercial sale of Products. Royalties will be paid as described below:
a) Royalty-free for sales to any LMICs for use in any LMIC;
b) In HICs where there is a Patent Right granted and in force in the country of manufacture or sale, a non-creditable, non-refundable royalty of five percent (5 %) payable on Net Sales in the previous calendar year and on a country-by-country basis and commencing on the date of the first sale of Product and continuing until the expiry of the last-to-expire Patent Right in such country.
c) In HICs where there is no Patent Right granted and in force in the country of manufacture or sale but where Licensee has used the Material and Licensed Know-how for the manufacture of the Products, a non-creditable, non-refundable royalty of one and a half percent (1,5 %) payable on Net Sales in the previous calendar year and on a country-by-country basis and commencing on the date of the first sale of Product and continuing for a period of ten (10) years from the first sale.