An architecture firm uses UDK to create a live walk-through presentation for their customers. They charge their customers a fee of US$500 for each walk-through. Before they begin to charge customers for the walk-through, they would pay Epic US$99 for a royalty-bearing commercial UDK license. They sell walk-through presentations to 100 customers in the first quarter, bringing in US$50,000 in revenue. No royalty payment would be required to Epic for that first US$50,000. In the second quarter, they sell another 100 walk-through presentations, bringing in another US$50,000 in revenue. They are required to pay US$12,500 to Epic. On subsequent revenue, they are required to pay the 25% royalty.