definiens: means the Fully Burdened Costs of distributing the Crude Ingredient or the Finished Ingredient, as applicable, toAffiliates or Third Parties, including without limitation actual out - of - pocket logistics costs in connection therewith, but excluding ( i ) any sales ormarketing costs, ( ii ) any costs relating to the distribution of the Ingredient or Finished Ingredient after its delivery by [COMPANY] to Third Parties,(iii ) costs associated with returns or recalls, ( iv ) any inventory write - offs, ( v ) any idle capacity costs and ( vi ) any costs associated withcommission, bad debt or other payment to Third Party distributors or agents which exceed 1 % of Net Sales of the applicable quarter, providedthat the Parties will, in good faith, increase the percentage appropriately if [COMPANY] adjusts its commercialization model to pursue more saleswith customers who only have a country specific or regional based network