definiens: shall mean gross amounts invoiced in respect of sal es of the Product in the Territory by Falk, its Affiliates or Sublicensees, as appropr iate, to Third Parties, less the following items : ( a ) trade, quantity and cash discounts or rebates a ctually allowed and taken and any other adjustments, provided that such discounts or rebates are not applied disproportionately to the Product as compared with other similar products ( for example, Endofalk ) of the selling entity, including, without limitation, those granted on account of price adjustments, billing errors, re jected goods, damaged goods and recall returns ; 6 ( b ) credits, rebates, charge - back and prime vendor rebates, fees, reimbursements or similar payments granted or given to wholesalers an d other distributors, buying groups, health care insurance carriers, pharmacy benefit ma nagement companies, health maintenance organizations or other institutions or health care organizations ; ( c ) any tax, tariff, customs duties, excise or othe r duties or other governmental charge ( other than an income tax ) levied on the sale, tran sportation or delivery of the Product ; ( d ) payments or rebates reasonably and customarily paid in connection with sales of Product to any governmental or regulatory authority ; ( e ) any write offs for bad debt provided that in ea ch Year the maximum sum which may be deducted in respect of bad debts shall not e xceed [ * ] % ( [ * ] per cent ) of Net Sales in such Year and further provided that in the event that any bad debt is written off and subsequently recovered by Falk, upon such r ecovery such debt shall be included in Net Sales for such Quarter in any state ment under Clause 5 provided always that : ( i ) Sales of a Product by and between Falk and its Affiliates and Sublicensees are not sales to Third Parties ( except where such Affil iate or Sublicensee purchasers are end users ) and shall be excluded from Net Sales calculations for all purposes ; ( ii ) Where a Product is sold otherwise than on arm ’ s length terms the price that would have been charged on an arm ’s length sale ( ca lculated as above ) shall be the invoice price for such Product and where a Prod uct is disposed of for consideration other than cash, such consideration s hall be valued at the fair market value thereof ; ( iii ) Where a Product is not sold on arm ’s length t erms but is used or otherwise disposed of on a commercial basis by a Third Party, the price that would have been charged ( after the deductions in Sub - Clauses ( a ) through ( e ) above ) on an arm ’s length sale in such country shall be deemed t he Net Sales for the sale of such Product, provided that reasonable quantities o f Product supplied and used in clinical trials or for other research or developmen t activities or reasonably and customarily supplied for promotional purposes as sa mples shall not be treated as being disposed of on a commercial basis and shall b e ignored for the purpose of calculating Net Sales