definiens: means, with respect to a given period, the gross amount invoiced for sales of Licensed Produets during such period, in arm 's length sales by 4 - AB or its Affiliates to Third Parties less, in each case solely to the extent relating to such Licensed Products and solely to the extent actually incurred, allowed, paid, accrued or specifically allocated to the gross amount invoiced, and determined in accordance with applicable financial reporting standards : ( a ) normal and customary trade, cash and quantity discounts actually given, coupons actually taken, credits, price adjustments or allowances for damaged Licensed Product, returns or rejections of sueh Licensed Product ; 3 ( b ) adjustments . allowances, credits, fees, reimbursements, chargeback payments and rebates ( or the equivalent thereof ) actually given for Licensed Products granted to group purchasing organizations or other buying groups, managed health care organizations, pharmacy benefit management companies . health maintenance organizations or any other providers of health insurance coverage, health care institutions ( including hospitals ) or other health care organizations . Third Party health care administrators or patient assistance or other similar programs, or to federal, state / provincial, local and other governments, including their agencies . or to wholesalers, distributors or other trade customers ; ( c ) reasonable and customary freight, shipping insurance and other transpcll1ation expenses, each directly related to the sale of Licensed Products ( if actually borne without reimbursement from any Third Party ) ; ( d ) distribution commissions / fees paid or payable to any Third Patty providing distribution services to 4 - AB or its Affiliates ; ( e ) sales, value - added or excise taxes . tariffs and duties, and all other taxes and government charges related to the sale of Licensed Products, in each case to the extent that each such item is actually borne by 4 - AB or its Affiliates without reimbursement from any Third Party ( but excluding taxes properly assessed or assessable against the income derived by 4 - AB or its Affillatcs from such sale ) ; ( f ) ( g ) Product ; actual bad debt expense ( but not exceeding 5 % of Net Sales ) ; adjustments for overbilling, errors, rejection, recalls or return of Licensed ( h ) rebates payable in connection with state or federal Medicare ( Title XVI ] ] of the Social Security Amendments of 1965, as amended ), Medicaid ( Title XIX of the Social Security Amendments of 1965, as amended ) or similar programs in the United States and comparable programs elsewhere in the Territory ; and 0 ) any item substantially similar in character or substance to any of the foregoing, which is permitted by applicable financial reporting standards to be accounted for in the calculation of Net Sales prevailing at the time and customary in the medical diagnostics industry at the ti me