Common use of Payments to Third Parties Clause in Contracts

Payments to Third Parties. Licensee shall have a royalty credit equal to [*] of all amounts paid by Licensee to Third Parties with respect to licenses to intellectual property rights covering a Licensed Product or its manufacture or use in the Field. Such royalty credit may be applied against royalties due under Section 5.03 with respect to such Licensed Product, provided that the royalty paid by Licensee after the application of any credit shall not, as a result of such adjustment, be less than [*] of the royalty rate which would otherwise apply under Section 5.03 to such Licensed Product, unless the royalty reduction set forth in Section 5.04 applies to such Licensed Product.