Upfront payment clause samples

Under the Cannabis Licensing Agreement, the Company is required to pay Austrianova an Upfront Payment of $2,000,000. The Company has the right to make periodic monthly partial payments of the Upfront Payment in amounts to be agreed upon between the parties prior to each such payment being made. Under the Cannabis Licensing Agreement, the Upfront Payments must be paid in full by no later than June 30, 2016. As of April 30, 2016, the Company has paid Austrianova $1.85 million of the Upfront Payment. The $2 million cost of the license has been recorded as research and development costs during the year ended April 30, 2015.

4.1 Upfront Payment. Roivant shall pay to Eisai a one-time, non-refundable, non-creditable upfront payment of three million five hundred thousand Dollars ($3,500,000) within five (5)business days after the Effective Date. Eisai acknowledges that Roivant has already paid Eisai one hundred thousand Dollars ($100,000) on August31, 2015, which amount shall be credited against the amount due under this Section 4.1.

8.1 Upfront Payment. Within ten (10)days after the Effective Date, Dermavant shall pay to Portola a one-time, non-refundable and non-creditable upfront payment of eight million seven hundred fifty thousand Dollars ($8,750,000).

4.1. Upfront Payment. In partial consideration of the rights granted by AstraZeneca to Licensee hereunder, Licensee shall pay to AstraZeneca a nonrefundable and non- creditable upfront payment equal to two million Dollars ($2m) within ten (10)days after the Effective Date of this Agreement, which shall be nonrefundable and non-creditable.

8.1 Upfront Payment. Within ten (10)Business Days after the Effective Date, Roivant shall pay to TheraVida a one-time, non-refundable and non-creditable upfront payment of two million Dollars ($2,000,000).

You disclose that under the Ahon Pharma license and collaboration agreement you are entitled to receive a non-refundable upfront payment of $5.0 million; however, it appears that you have only received $500,000 of this amount and the remaining $4.5 million is due upon "regulatory clearance to initiate a clinical trial in China." It would appear that the $4.5 million payment is more akin to a milestone payment and therefore it is unclear why you would characterize it as part of the overall non-refundable upfront payment. Please revise to clarify. Please also disclose how this $4.5 million payment and other milestone payments were considered in determining your transaction price and the extent to which such variable consideration was constrained.

c. An amount in cash equal to USD$600,000, which amount represents [...***...] ([...***...]%) of the upfront payment (the “Novartis Upfront Payment”) received in connection with that certain License Agreement, dated May1, 2017, by and between Novartis International Pharmaceutical Ltd. and Celyad (the “Novartis License Agreement”), in full satisfaction of any payments owed to OnCyte under the APA, as amended by the APA Amendment, or otherwise, in connection with the Novartis Upfront Payment. Such amount shall be paid no later than fifteen (15)days after the Amendment Effective Date.

Response: The Company respectfully acknowledges the Staff’s Comment and has revised the disclosure on pages161 and F-74 of the S-4/A to clarify that it received $2,548,689 on the execution of the Elanco agreement and explain the components of the upfront payment. The upfront payment consisted of two components: (i)a non-refundable, non-creditable amount of $1,500,000 and (ii)$1,048,689 designated as reimbursement for past product development expense incurred by the Company in an acute trial and safety study.

The Company determined the initial transaction price totaled approximately $300.0 million, which includes the upfront payment.The Company will exclude any future estimated milestones, royalties, or profit-sharing payments from this transaction price to date.The Company will allocate the total $300.0 million initial transaction price to its one distinct performance obligation for the ARO-AAT license and the associated Takeda R&D Services.Revenue will be recognized using a proportional performance method (based on actual costs incurred versus total estimated costs incurred for the Takeda R&D Services). Revenue for the three months ended December 31, 2020 and 2019 were $8.2 million and $0, respectively. As of December 31, 2020, there were $8.2 million in contract assets recorded as accounts receivable.

Upfront Payment.Within [***] after Takeda’s receipt of an invoice from Arrowhead, to be submitted promptly following the Effective Date, in consideration of the licenses granted to Takeda hereunder, Takeda will pay to Arrowhead a non-refundable, non-creditable upfront payment in the amount of $300,000,000 via wire transfer of immediately available funds in accordance with the instructions attached hereto as Schedule 10.4.1 (Wire Instructions).

The Company determined that the transaction price of the Genentech Agreement at inception was $120 million consisting of the upfront payment. The potential milestones are not included in the transaction price as these are contingent on future events and the Company would not recognize these in revenue until it is not probable that these would not result in significant reversal of revenue amounts in future periods.The Company will re-assess the transaction price at each reporting period and when events whose outcomes are resolved or changes in circumstances occur.

8.1 Upfront Payment. Genentech shall pay to Xencor a one-time, non-refundable, non-creditable upfront payment of onehundred twenty million Dollars ($120,000,000) no later than thirty (30) days after the Effective Date.

During the three and nine months ended September 30, 2017, we recognized $107,000 and $493,000, respectively, from ongoing per unit royalties and $252,000 and $747,000, respectively, from a prorated portion of the $8.0 million upfront payment. During the three and nine months ended September 30, 2016, we recognized $79,000 and $732,000, respectively, from ongoing per unit royalties and $252,000 and $750,000, respectively, from a prorated portion of the $8.0 million upfront payment. Royalty revenue is lower during the three and nine month ended September 30, 2017 due to lower sales by licensees.

• increase in other R&D activities of $1.4 million. This increase is due to a $0.6 million increase in personnel-related expenses, including stock-based compensation expense due to the hiring of additional R&D staff, as well as a 5% license fee of $0.3 million to TUM in relation to the Roche upfront payment. General lab supplies increased $0.1 million as well as consulting costs of $0.2 million and various facility costs allocated to research and development of $0.2 million, primarily associated with the opening of our Boston office. As of March31, 2016, we employed 29 full-time and 2 consultants in our research and development group compared to 23 full-time, 5 part-time personnel in our research and development group as of March31, 2015.