Common use of Performance Minimums Clause in Contracts

Performance Minimums. Subject to Section 8.3, the Performance Minimums defined below shall apply to all five (5) Markets but only to two (2) Licensed Products (which shall not include B&L Licensed Products or a Third Party Licensed Products) approved by the applicable regulatory authority for sale in a CDS Indication as follows: the Immusert Product (Cyclosporine) when approved for uveitis in a Market ("Immusert") and the first CDS Licensed Product when approved in a Market by the applicable regulatory authority for sale for ARMD or DME, whichever occurs first ("ARMD/DME Product"). It is understood, however, that although the Immusert and ARMD/DME Products are based on Indications and are referred to independently in this Section, any Performance Minimums will be measured against sales of all Indications for each Licensed Product and not just the separate Indications of uveitis or ARMD/DME. Furthermore, the Performance Minimums for the European Target Market for Immusert and the ARMD/DME Product, treated separately and independently, shall not apply until each of them, respectively, is approved for sale in at least three (3) of the following countries in Europe: France, Germany, Italy, and the United Kingdom. Subject to Section 8.3, during each of the first three (3) 12-Month Periods following the first approved commercial sale for each of the Immusert and ARMD/DME Products in a Market ("Approved Market"), Licensee shall either (i) obtain Net Sales for such Product in such Approved Market equal to at least [*] of the projected Net Sales for such Product in such Market contained in the applicable Market Projection Plan approved by the Steering Committee prior to such first commercial sale (the "Performance Minimum"), or (ii) pay to Licensor a royalty equal to the amount Licensor would have received based on the achievement during the applicable 12-Month Period of the Performance 12inimum ("Minimum Payment"). If Licensee has made the applicable Minimum Payment for Immusert and the ARMD/DME Product (each treated separately and independently) in an Approved Market and subsequent information indicates that the Net Sales on which such Minimum Payment was made were underreported, Licensee shall be entitled to offset the excess Minimum Payment against any royalties due and, if applicable, against any Additional R&D Payments which might subsequently be due. If Licensee fails to achieve the Performance Minimum for Immusert and the ARMD/DME Product (each treated separately and independently) in any applicable 12-Month Period for any Approved Market, then Licensee shall have forty-five (45) days from the last day of the last month of the end of the applicable 12-Month Period to pay the amount due to achieve the Minimum Payment for the Product(s) for such Approved Market for such Period. If Licensee does not pay such amount, Licensor shall have one hundred thirty-five (135) days after the end of the forty-five (45)-day period in which to give Licensee written notice that Licensee's rights under this Agreement for the applicable Product(s) in the applicable Approved Market will be nonexclusive as of the date ninety (90) days following the date of such notice from Licensor. If Licensor does not so notify Licensee in writing within the one hundred thirty-five (135) day period, Licensee's rights with respect to such Product(s) in such Market shall remain exclusive for the next 12-Month Period in the 36-month period to which Performance Minimums apply.