definiens: . Sublicense Revenue means cash or cash equivalent consideration receivedby MERRIMACK or an Affiliate of MERRIMACK from a Third Party as consideration for a license or sublicense ofrights to Develop and/or Commercialize the Licensed Compound or the Licensed Product in the MERRIMACKTerritory ; provided, however, that, if MERRIMACK or an Affiliate of MERRIMACK receives compensation in the formof development, regulatory or approval milestone payments that are not otherwise excluded below and that are basedon the same development, regulatory or approval milestones on which the development, regulatory or approvalmilestone payments payable by MERRIMACK to PEI under this Agreement are based, Sublicense Revenue willinclude only the portion of such milestone payments in excess of the milestone payments payable by MERRIMACKto PEI under this Agreement based on the same milestones . In addition, Sublicense Revenue shall specificallyexclude:(a ) upfront fees payable upon the grant of the license or sublicense;(b ) payments or reimbursements for the cost of MERRIMACK ’s or its Affiliates ’ research and developmentefforts for the Licensed Compound or the Licensed Product to be performed after the effective date of the applicablelicense or sublicense, accounted for at reasonable and customary FTE rates ( any excess over a reasonable andcustomary FTE rate shall be included in Sublicense Revenue ) or in the form of external costs billed through on apass - through basis with no markup;(c ) research and development milestone payments up to an aggregate total of $ 150.0 million;(d ) royalties and sales milestone payments ( or, in the case of a profit sharing deal structure, shares of netprofits);(e ) payments to MERRIMACK or its Affiliates of the purchase price of equity securities to the extent notexceeding the fair market value of such securities;(f ) loan proceeds paid to MERRIMACK or its Affiliates by a licensee or sublicensee in arm ’s length debtfinancing on non - preferential commercial terms that are, other than amounts forgiven upon or following termination ofthe applicable licensee ’s or sublicensee ’s rights, subject to repayment by MERRIMACK or its Affiliates ( any amountof such a loan forgiven by the lender for any reason other than termination of the applicable licensee ’s orsublicensee ’s rights shall be included in Sublicense Revenue ) ; and(g ) payment for material supplied by MERRIMACK or its Affiliates, including a reasonable and customarymargin on such material ( any excess over a reasonable and customary margin is included in Sublicense Revenue )