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Exhibit 10.55
Patent License
WHEREAS: PREP-TECHNOLOGY CORP. ("PREP-TECH") desires to obtain a
license under certain patents and patents pending which are owned by American
Dental Technologies, Inc. ("ADT"), and ADT is willing to license such patents to
PREP-TECH.
NOW THEREFORE, the parties agree as follows:
1. ADT hereby grants to PREP-TECH, a nonexclusive license under U.S.
Patent No. 5,275,561 and U.S. Patent No. 5,330,354, U.S. Patent No. 5,350,299
and U.S. Patent No. 5,525,058 and any foreign counterparts, reexaminations,
reissues, continuations-in-part based on the disclosures of the patents listed
in this paragraph 1, for the life of such patents to make, use, lease and sell
PREP-TECH'S air abrasive dental models and future models provided they do not
infringe any non-dental patents or non-dental patent applications of ADT (for
example helical feed mechanisms) throughout the world, but excluding Japan,
presently covered by agreements between ADT and Denics Co., Ltd., a/k/a Dental
Innovative Corporation, a Japanese corporation. Except as set forth in the
following sentence, the license granted in this paragraph 1 is non-transferable
by assignment, sublicense or other means of transfer provided, further, that
during the period in which PREP-TECH is licensed under this Agreement, PREP-TECH
shall have the right to have the products of this paragraph 1 manufactured by a
third party solely for PREP-TECH. PREP-TECH may transfer this license to another
party (except for Kreativ, Inc., its affiliates, successors or assignees) in
connection with the sale of the company or its air abrasion business. Such
transferee must assume the obligations hereunder and confirm the validity of the
patents covered by this Agreement. The license in this paragraph 1 is subject to
the payment provided in paragraph 2 of this Agreement.
Payments
2. Beginning March 1, 1998, PREP-TECH, or its permitted successor or
assignee, shall pay to ADT a royalty on the net sales price (defined as gross
sales price less freight, duties and excise taxes) on all abrasive products used
for cavity preparations manufactured, sold or leased by PREP-TECH, or its
permitted successor or assignee, which are manufactured (by or on behalf of
PREP-TECH), sold or leased in a country in which ADT, presently or in the
future, owns or controls patents or patent applications on any dental air
abrasive products or methods of treatment, until the expiration of all such
patents/patent applications. For air abrasive products used for cavity
preparations which have an electro mechanically operated system and which are
covered by either U.S. Patent No. 5,275,561, U.S. Patent 5,330,354 or U.S Patent
5,350,299, or U.S. Patent No. 5,525,058 or any of their foreign counterparts or
continuations-in-part, the royalty shall be **. For all other air abrasive
products used for cavity preparation, such as completely pneumatic systems, the
royalty shall be **. In the event that PREP-TECH manufactures or has
manufactured on its behalf, and sells or leases air abrasive products used for
cavity preparations wholly within a country where ADT holds no such patents or
patent applications or where all such patents have expired, then no such
payments shall be required. The payments required under this paragraph 2 of this
Agreement shall accrue when the subject products are delivered, invoiced or paid
for, which ever occurs first. All payments shall be made in U.S. dollars.
**Redacted confidential information has been filed separately with the
SEC pursuant to Rule 24b-2.
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Payment Date and Records
3. PREP-TECH shall make the payments required in paragraph 2 of this
Agreement on February 15th, May 15th, August 15th, and November 15th for the
preceding accounting quarter. PREP-TECH shall keep accurate books and records
reflecting transactions made under this Agreement and shall make reports at the
time of such payments fully supporting the calculation of payments made,
including the number of units sold or leased and the sales price used to
determine payments. ADT shall have the right to inspect such books and records
through an independent certified accountant, not to exceed one such audit per
year. Past due payments shall bear interest at the highest lawful rate from the
due date.
Termination
4. ADT may terminate the license granted by paragraph 1 of this
Agreement only in the event of a material breach of this Agreement by PREP-TECH,
and then only if, upon receiving notice of such breach, PREP-TECH fails to cure
such breach within thirty (30) days of such notice; such right of termination
shall not be in lieu of other remedies such as specific performance.
Patent Marking
5. PREP-TECH shall apply statutory notice to its air abrasive units
sold in the United States substantially as follows: "This unit and its use is
protected by one or more of the following U.S. Patents:
5,275,561; 5,330,354; 5,350,299; and 5,525,058."
Favored Rate
6. PREP-TECH royalty rates will be lowered in a most favorable rate
relationship with ADT for air abrasive units.
Private Label
7. PREP-TECH shall have the right to "private label" the licensed air
abrasive cavity prep products it manufactures so long as the appropriate
royalties are paid.
Japan
8. In the event ADT acquires patents rights for Japan, this license
will extend to Japan.
Notice
9. All notices required to be given under this Agreement shall be given
in writing and shall be sent by regular mail, postage prepaid, certified mail or
by recognized overnight express mail service to the parties at the addresses
below.
If to ADT, to:
Xxx X. Xxxxxxx
President and Chief Executive Officer
American Dental Technologies, Inc.
0000 Xxxx Xxxx
Xxxxxx Xxxxxxx, XX 00000
Tel: (000) 000-0000 / Fax: (000) 000-0000
If to PREP-TECH to:
Xxx Xxxxxxxxx
00000 Xxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Tel: (000) 000-0000 / Fax: (000) 000-0000
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Effect of Notices
10. A notice sent pursuant to paragraph 9 of this Agreement shall be
deemed given on the date it is mailed, unless the intended recipient can
establish that such notice was not timely received.
Governing Law and Collection Costs
11. This Agreement is made in the County of Nueces, State of Texas, and
shall be governed by the laws of the State of Texas without regard to its
conflict of laws and principles. PREP-TECH agrees to pay any costs incurred by
ADT in collecting royalties due hereunder or enforcing its rights hereunder,
including attorney fees.
Warranties
12. Both parties represent that their undersigned representatives have
the full power and authority to enter into this Agreement. ADT represents and
warrants that it has the right and power to grant the license of paragraph 1 of
this Agreement, but makes no other warranties whatsoever regarding the patents
so licensed. PREP-TECH acknowledges the validity of the patents covered by this
Agreement and agrees that it will not challenge the validity, or institute any
proceeding which may adversely affect the validity of the patents covered by
this Agreement.
Relationship of Parties
13. This Agreement is not intended by the parties to, and shall not,
constitute or create a joint venture, partnership or other business organization
and neither party shall be nor shall act as an agent of the other party. Neither
party shall use the other party's name in any marketing efforts.
Severability
14. The invalidity of any provision of this Agreement shall not affect
the validity of any other provision of this Agreement.
Complete Agreement
15. This Agreement constitutes the entire agreement of the parties
regarding this subject matter and supersedes any and all prior or
contemporaneous oral or written agreements, understandings, negotiations or
discussions among the parties regarding this subject matter. Any amendment or
other modifications to this Agreement must be made in writing and must be duly
executed by an authorized representative or agent of each party.
Counterparts
16. This Agreement may be executed in multiple counterparts, each of
which shall be deemed to be an original, and all such counterparts shall
constitute but one instrument.
Permitted Successors and Assigns
17. This Agreement, and all provisions herein, shall bind the parties
and their permitted successors and permitted assigns.
AMERICAN DENTAL PREP-TECHNOLOGY CORP.
TECHNOLOGIES, INC.
/S/ Xxx X. Xxxxxxx /s/ Xxx X. Xxxxxxx
President and Chief Executive Officer President
Date: 06/29/98 Date: 06/25/98
