definiens: shall mean : ( A ) with respect to Product manufactured by a Third Party, a Party 's cost of procuring such Product on an arms ' length basis ; or ( B ) with respect to Product manufactured by a Party or one of its Affiliates, ( 1 ) Direct Costs incurred, on a cash basis, by such Party or one of its Affiliates to manufacture such Product, including Direct Costs of purchasing, inspection, quality assurance, quality control, storage, scrap and training, and ( 2 ) a portion of depreciation, amortization, interest expense, utilities, rent, maintenance and repairs, insurance and other manufacturing overhead ( the ) allocable to Product as determined by the following formula : the Manufacturing Overhead multiplied by a fraction, the 7/15/2016 https://www.sec.gov/Archives/edgar/data/1314102/000095012306000446/y16393exv4w13.txthttps://www.sec.gov/Archives/edgar/data/1314102/000095012306000446/y16393exv4w13.txt 13/66numerator of which is the number of direct labor hours of individuals who spent time on the production of Product at a plant at which Product is manufactured, and the denominator of which is the number of direct labor hours devoted to the production of all products at such plant when the plant is operating at full capacity, provided that Manufacturing Costs shall exclude costs associated with excess capacity, selling costs ( including, without limitation, marketing, advertising, salaries and commissions ), corporate overhead, costs that are otherwise attributed as Direct Development Costs or Direct Commercialization Costs under this Agreement, royalties ( earned or paid up ) and other amounts ‐10‐ < PAGE > payable to Third Parties under any license taken by a Party in connection with the manufacture of the Product, and all amounts spent on research and development ; provided, however, that any amount determined pursuant to clause ( B ) shall not exceed the amount that a qualified Third Party manufacturer would charge for supplying comparable quantities of the relevant Product in a timely manner on reasonable and customary terms and conditions