definiens: means the total of the gross sales of Licensed [COMPANY] IP Products sold or transferred by A VI and A VI 's Affiliates and sublicensees, less the following actual and customary third­party wholesaler and or distributor deductions as applicable : reasonable and customary wholesaler or distributor sales commissions ( for clarity, commissions and other compensation paid to sales and marketing personnel of AVI or its marketing partner(s ) are not deductible ) ; allowances or credits to purchasers for rejections, returns, withdrawals or recalls ; cash, trade or quantity discounts ; sales rebates or chargebacks ; third party distribution fees ; sales, use, excise or other taxes imposed on sales ; import and export duties ; and shipping charges . To the extent A VI has deducted amounts as permitted by the preceding sentence and AVI later receives a refund against the amount deducted, the refunded amount shall be included as part of A VI Net Sales . Payments shall be made only upon sales or transfers between unrelated third parties and shall be based on arms - length consideration . In the event AVI or any of its Affiliates makes a transfer of a Licensed [COMPANY] IP Product to a third party for other than monetary consideration or for less than fair market value, such transfer shall be considered a sale hereunder to be calculated at a fair market value for accounting and royalty purposes . A Licensed [COMPANY] IP Product shall be deemed sold or transferred at the time the entity making the transaction on which the royalty is based bills, invoices, ships, or receives payment for such Licensed [COMPANY] IP Product, whichever occurs first . For sales of a Licensed [COMPANY] IP Product which constitutes a Combination Product, A VI Net Sales will be calculated based on a reasonable allocation between the Combination Product Components and the remainder of the Licensed [COMPANY] IP Product