Provision Language
Definitions
“Net Sales” means, with respect to the Product, the gross amount invoiced on sales by Sublicensees, their affiliates or distributors to arm’s length Customers (or, where the sale is not at arm’s length, the price that would have been so invoiced if such sale had been at arm’s length) in any country of the world less the following deductions, to the extent included in the sales invoice with respect to such Product:
i. normal and customary trade and quantity discounts actually given (discounts which all together cannot exceed 20% of the sales price provided, that, where the Product is included as part of any program based on multiple product offers, such discounts shall be consistent with the discounts applied to the same Customer when the Product is not combined with any other products or services; and, in case of returns or rejections of Products, the associated credits and price adjustments; and
ii. 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.
provided, that, Net Sales shall not include the use of the Product in field tests, marketing, or other similar programs or studies where Product is supplied without charge, (but shall include any amount invoiced for such use).
MEDIGEN – MPP AGREEMENT
3. FEES AND ROYALTIES
3.1 MPP will require Sublicensees to pay directly to MEDIGEN the royalties and fees as per Clause 3 of each Sublicence.
3.2 MEDIGEN shall invoice the Sublicensee in US Dollars for the royalties payable pursuant to this Agreement for the immediately preceding Agreement Quarter as soon as reasonably practical following receipt by MEDIGEN of the report from the Sublicensee. All royalty amounts payable to MEDIGEN under this Agreement are exclusive of tax or duties which the Sublicensee will bear at the rate from time to time prescribed by law.
FORM OF SUBLICENSE
3. FEES and ROYALTIES
3.1 Technology fees. The Sublicensee shall pay directly to MEDIGEN by bank transfer to the account indicated on the invoice the following technology fees:
i. a one-time fee of 10,000 US Dollars for Sublicensees from LIE and LMIEs or a one-time fee of 100,000 US Dollars for the Sublicensees from UMIEs and HIEs, due at the Effective Date (the “Licence Fee“). The Licence Fee is not refundable and is in addition to and not creditable against any other sums payable by Sublicensee under this Agreement; and
ii. a one-time fee of 150,000 US Dollars for Sublicensees from LIE and LMIEs, or a onetime fee of 300,000 US Dollars for the Sublicensees from UMIEs and HIEs due at the receipt of by the Sublicensee of the Licensed Technology documentation listed in Annex 2 hereto, and
iii. a one-time fee of 100,000 US Dollars for Sublicensees from LIE and LMIEs, or a onetime fee of 200,000 US Dollars for the Sublicensees from UMIEs and HIEs due and payable on the date falling six (6) months after the Effective Date as compensation for Basic Support and Training as described in ANNEX 2 hereto, and
iv. a one-time fee of 100,000 US Dollars for Sublicensees from LIE and LMIEs, or a onetime payment of 200,000 US Dollars for the Sublicensees from UMIEs and HIEs due upon notice from MEDIGEN that the Materials are ready for pick up as compensation for Materials preparation work.
v. a one-time payment upon the first launch of the Product amounting to:
a) 25,000 US Dollars in the first country of LIEs; and
b) 75,000 US Dollars in the first country of LMIEs; and
c) 150,000 US Dollars in the first country of UMIEs; and
d) 300,000 US Dollars in the first country of HIEs,
vi. a running technology fee of:
a) 3% of Net Sales in LIEs; and
b) 5% of Net Sales in LMIEs; and
c) 8% of Net Sales in UMIEs; and
d) 10% of Net Sales in HIEs,
payable on a country-by-country basis starting from the date of the first commercial sale of the Product in each country and continuing until the date falling (15) years after the date of each such first commercial sale (“Base Period”); provided, that, if, at any time during the Base Period, there occurs one or more transfers of technology arising out of Inscope MEDIGEN New Development, the above period shall continue to the later of (i) last day of the Base Period or (ii) the date falling five (5) years after the date of the last such transfer related to a Significant Inscope MEDIGEN New Developments (such later date to be referred to herein as the “Expiry Date”) .
3.2 Patent royalties. The Sublicensee shall pay directly to MEDIGEN by bank transfer to the account indicated on the invoice the royalties on Net Sales of the Products on a country-bycountry basis starting from the date of the first commercial sale of the Products will be paid as described below:
a) a royalty of 0,5% of Net Sales in LIEs; and
b) a royalty of 1% of Net Sales in LMIEs; and
c) a royalty of 3% of Net Sales in UMIEs; and
d) a royalty of 5% of Net Sales in HIEs,
provided, that the royalties are due where there is a Patent Right granted and in force in the country of manufacture or sale, until the expiry of the last-to-expire Patent Right in such country.
3.3 Additional payment obligations for Additional MEDIGEN New Developments. If at any time during the Base Period, there shall occur one or more transfers of technology arising out of an Additional MEDIGEN New Development, the technology fees and term (“Additional MEDIGEN New Development Term”) therefor shall be agreed between the Parties and MEDIGEN in consultation with WHO C-TAP, at the time of such transfer.
3.4 Payment modalities. All payments to be made to MEDIGEN hereunder shall be made in freely transferable U.S. Dollars to the account specified by MEDIGEN in a jurisdiction other than the jurisdiction of the Sublicensee, free and clear of foreign exchange controls, taxes and duties (other than income taxes payable by MEDIGEN in the location where MEDIGEN operates from at the time of payment) (“Taxes”), all of which Taxes shall be borne by the Sublicensee. If any Taxes are imposed on any such payment whether by withholding or otherwise, the Sublicensee shall gross up the amount paid such that after giving effect to such Taxes, MEDIGEN receives the amount it would have otherwise received had no such Taxes been imposed.