definiens: shall mean the gross amount invoiced by Sorrento, all Sublicensees, orany of them, on all sales of Licensed Products, less ( a ) customary discounts actually allowed ; ( b ) credits forclaims, allowances, retroactive price reductions or returned goods ; ( c ) prepaid freight ; and ( d ) sales taxes or othergovernmental charges actually paid in connection with sales of Licensed Products [ but excluding what arecommonly known as income taxes ( whether paid by Sorrento/ Sublicensee or withheld by the third party atsource ) and value - added taxes ] . Net Sales shall include all consideration charged by Sorrento and Sublicenseesin exchange for any Licensed Products, including without limitation any monetary payments or any otherconsideration whatsoever . For purposes of determining Net Sales, a sale shall be deemed to have occurred whenan invoice therefore shall be generated or the Licensed Product shipped for delivery . Sales of Licensed Productsby Sorrento to any Affiliate or Sublicensee or by any Sublicensee to an Affiliate or other Sublicensee which is areseller thereof shall be excluded from calculating Net Sales, and only the subsequent sale of such LicensedProducts by such Affiliates or Sublicensees to unrelated parties shall be deemed Net Sales hereunder