My take: don't divide the revenue; that's like dividing equity. If he's unreasonable, anything else you do in the future is going to infringe on his perceived royalty rights.

Think about coming up with a conservative estimate of what you'll do with this product quarterly, and offer him a flat $N, based on a generous share of that estimate, for any quarter in which (a) he has in that quarter contributed code to the most recent significant version released as of that quarter and (b) you made at least $N. You take the risk in weak quarters, and you retain all the ownership.