SELLER AND USED IN CONNECTION WITH
THE MARKETING AND PROMOTION OF THE PRODUCT; AND (II) THOSE ITEMS OF ADVERTISING
AND PROMOTIONAL MATERIALS AND LITERATURE OWNED BY SELLER AS OF THE CLOSING AND
USED IN CONNECTION WITH THE ADVERTISING AND PROMOTION OF THE PRODUCT, PROVIDED
THAT "MARKETING MATERIALS" SHALL EXCLUDE THE LABELING OF THE PRODUCT, WHICH
SHALL BE DEEMED PART OF THE REGULATORY APPROVALS.
(XX)
"MATERIAL ADVERSE EFFECT" MEANS AN EFFECT OR CONDITION THAT
INDIVIDUALLY OR IN THE AGGREGATE IS MATERIALLY ADVERSE TO:
(I) THE PURCHASED
ASSETS; (II) THE RESULTS OF OPERATIONS, BUSINESS, OPERATIONS, CONDITION
(FINANCIAL OR OTHERWISE) OR PROSPECTS OF THE BUSINESS; OR (III) SELLER'S ABILITY
TO CONSUMMATE THE TRANSACTIONS CONTEMPLATED HEREBY.
(YY)
"NET SALES" MEANS THE AGGREGATE AMOUNT INVOICED ON ACCOUNT OF SALES
OF THE PRODUCT BY BUYER OR ANY OF ITS AFFILIATES OR THEIR SUBLICENSEES TO A
THIRD PARTY IN THE TERRITORY (BUT NOT INCLUDING SALES BETWEEN BUYER AND ITS
AFFILIATES WHERE THE PRODUCT IS INTENDED FOR RESALE) LESS THE FOLLOWING
REDUCTIONS RELATING TO SUCH SALES: (A) TRADE, QUANTITY AND CASH DISCOUNTS OR
REBATES, WHICH ARE NOT ALREADY REFLECTED IN THE AMOUNT INVOICED; (B) ANY
ADJUSTMENTS OR ALLOWANCES ON ACCOUNT OF PRICE ADJUSTMENTS, BILLING ERRORS,
REJECTED GOODS, DAMAGED GOODS AND RETURNS; (C) CREDITS, VOLUME REBATES,
CHARGE-BACK AND PRIME VENDOR REBATES, FEES, REIMBURSEMENTS OR SIMILAR
**Portions of the Exhibit have been omitted and have been filed separately
pursuant to an application for confidential treatment filed with the Securities
and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act
of 1934, as amended.
10
PAYMENTS GRANTED OR GIVEN TO WHOLESALERS AND OTHER DISTRIBUTORS, BUYING GROUPS,
HEALTH CARE INSURANCE CARRIERS, PHARMACY BENEFIT MANAGEMENT COMPANIES, HEALTH
MAINTENANCE ORGANIZATIONS OR OTHER INSTITUTIONS OR HEALTH CARE ORGANIZATIONS,
WHICH ARE NOT ALREADY REFLECTED IN THE AMOUNT INVOICED; (D) ANY TAX, TARIFF,
CUSTOMS DUTY, EXCISE OR OTHER DUTY OR OTHER GOVERNMENTAL CHARGE (OTHER THAN A
TAX ON INCOME) LEVIED ON THE SALE, TRANSPORTATION OR DELIVERY OF THE PRODUCT AND
BORNE BY THE SELLER THEREOF, ITEMIZED ON THE APPLICABLE INVOICE AND REMITTED TO
THE APPLICABLE TAXING AUTHORITY; (E) PAYMENTS OR REBATES PAID IN CONNECTION WITH
SALES OF THE PRODUCT TO ANY GOVERNMENTAL OR REGULATORY AUTHORITY IN RESPECT OF
ANY STATE OR FEDERAL MEDICARE, MEDICAID OR SIMILAR PROGRAMS, WHICH ARE NOT
ALREADY REFLECTED IN THE AMOUNT INVOICED; AND (F) ANY INVOICED CHARGE FOR
FREIGHT, INSURANCE OR OTHER TRANSPORTATION COSTS CHARGED TO THE CUSTOMER.
FOR
PURPOSES OF THIS DEFINITION, THE PRODUCT SHALL BE CONSIDERED "SOLD" AND
"REDUCTIONS" ALLOWED WHEN SO RECORDED IN PARENT'S CONSOLIDATED AND CONSOLIDATING
FINANCIAL STATEMENTS PREPARED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING
PRINCIPLES.
(ZZ)
"NET SALES MILESTONE" HAS THE MEANING SET FORTH IN SECTION
4.02(A).
(AAA)
"NET SALES MILESTONE PAYMENT" HAS THE MEANING SET FORTH IN SECTION
4.02(A).
(BBB)
"NET SALES MILESTONE TERMINATION DATE" MEANS THE DATE THAT IS THE
LATER TO OCCUR OF (I) TWELVE (12) YEARS FROM THE CLOSING DATE AND (II) THE DATE
OF THE FIRST COMMERCIAL SALE OF A GENERIC VERSION OF THE PRODUCT IN THE
TERRITORY.
(CCC)