definiens: means, with respect to a Compound or Compounds, with respect to a calendar y ear ( or portion thereof ), all amounts ( whether in the form of upfront payments, milestone payments, royalties or otherwise ) received by [COMPANY] or any of its Affiliates from a Sublicensee specifically for the grant of a Sublice nse to such Sublicensee with respect to such Compounds, but exc luding : ( a ) amounts received by [COMPANY] or any of its Affili ates as payments for their actual reasonably alloca ted direct costs, including labor costs and out - of - pocket cost s, to perform research, development, Manufacturing or Commercialization activities or regulatory affairs or compliance activities with respect to any Compou nds except that any mark - ups or similar charges which exceed s uch actual direct costs shall not be excluded to th e extent otherwise falling within this definition ; ( b ) amounts received by [COMPANY] or any of its Affili ates from such Sublicensee as the purchase price fo r [COMPANY] ’s or any of its Affiliates ’ debt or equity securities, except that amounts which exceed the fair market value of such debt or equity securities shall not be so excluded to the extent otherwise falling within this definit ion ; ( c ) amounts paid by such Sublicensee to [COMPANY] or a ny of its Affiliates to purchase Compounds ; provide d, however, that such purchases are reflected in Net S ales ; ( d ) those actual and reasonable internal costs and out - of - pocket costs paid by [COMPANY] or its Affiliate s, and reimbursed by such Sublicensee to [COMPANY] or any of its Affiliates, for the filing, patent prosecution, maintenance, defense or enforcement of any Patent R ights that are directly and exclusively incurred wi th respect to any Compounds or, if incurred with respect to mu ltiple products, then reasonably allocated to any C ompounds except that any mark - ups or similar [ * ] Certain portions denoted with an asterisk have been omitted