definiens: shall mean, with respect to each Licensed Product or component thereof ( whethersuch components are sold individually or as a combination ), the total gross sales of such Licensed Product orcomponent(s ) sold by [COMPANY], its Affiliate or their respective direct or indirect sublicensee under the license orsublicense of this Agreement, for arm ’s length sales to 3*Confidential treatment has been requested for the redacted portions of this exhibit, and such confidential portionshave been omitted and filed separately with the Securities and Exchange Commission.any non - Affiliated third party, less the following deductions : trade and cash discounts, sales and excise taxes, rebates and return of goods . The foregoing shall be booked or calculated in accordance with Generally AcceptedAccounting Principles ( GAAP ) or International Financial Reporting Standard ( IFRS ) each as consistently applied bythe selling entity . For clarification, if the Licensed Product once sold by [COMPANY], its Affiliate or their sublicensee, forarm ’s length sales to any non - Affiliated third party is recalled for a reason attributable to ATHX, such sales shall bededucted from the Net Sales