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Exhibit 10.53
Patent License
WHEREAS: DANVILLE ENGINEERING, INC. ("DANVILLE") desires to obtain a license
under certain patents and patents pending which are owned by American Dental
Technologies, Inc. ("ADT"), and is willing to license such patents to DANVILLE.
NOW THEREFORE, the parties agree as follows:
1. ADT hereby grants to DANVILLE, a nonexclusive license under U.S. Patent
No. 5,275,561, 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 or continuations-in-part based on the disclosures of the patents
of this paragraph 1, for the life of such patents to make, use, lease and sell
DANVILLE'S current air abrasive dental models and future models to the extent
such future models do not infringe any non-dental patents or patent
applications (for example, on helical powder feed mechanisms) of ADT,
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. The license granted in this paragraph 1 is
non-transferable by assignment, sublicense or other means of transfer provided,
further, that the period in which DANVILLE is licensed under this Agreement,
DANVILLE shall have the right to have the products of this paragraph 1
manufactured by a third party solely for DANVILLE. The license in this
paragraph 1 is subject to the payment provided in paragraph 2 of this
Agreement.
Payments
2. Beginning October 1, 1997, DANVILLE, or its permitted successor or
assigneee, shall pay to ADT a royalty on the net sales price (defined as gross
sales price less freight, duties and taxes) on all air abrasive products used
for cavity preparations manufactured, sold or leased by DANVILLE, or its
permitted successor or assignee, which are manufactured (by or on behalf
DANVILLE), 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
patent/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. 5,330,354 or U.S Patent 5,320,299, or U.S.
Patent No. 5,525,058 or any of their foreign counterparts, 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
DANVILLE, 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. In no event shall a payment by DANVILLE under this
paragraph 2 be required for products that are both made and sold prior to
October 1, 1997.
3. DANVILLE shall (1) 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, with the first payment to be made on February 15,
1998. DANVILLE 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.
** Redacted confidential information has been filed separately with
the SEC pursuant to Rule 24b-2.
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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 DANVILLE, and then
only if, upon receiving notice of such breach, DANVILLE 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. DANVILLE 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."
Notice
6. 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 DANVILLE to:
Xxxx Fernwood
President and Chief Executive Officer
0000 Xxxxx Xxxx
Xxx Xxxxx, XX 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
7. A notice sent pursuant to paragraph 6 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
8. 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.
Warranties
9. 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.
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Relationship of Parties
10. 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 act as an agent of the
other party. Neither party shall use the other party's name in any
marketing efforts.
Severability
11. The invalidity of any provision of this Agreement shall not affect the
validity of any other provision of this Agreement.
Complete Agreement
12. 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
13. 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
14. This Agreement, and all provisions herein, shall bind the
parties and their permitted successors and permitted assigns.
Miscellaneous
(a) Air abrasive devices not marketed primarily for cavity preparation, such
as the microetchers and the microprophy, are not subject to this Agreement
and do not fall within the scope of devices used primarily for cavity
preparation and as such, no royalties would be due on these devices.
(b) DANVILLE'S royalty rates will be lowered in a most favored rate
relationship with ADT.
(c) DANVILLE shall have the right to 'private label' the licensed air
abrasive cavity prep products it manufactures so long as the appropriate
royalties are paid.
(d) In the event ADT reacquires patent rights for Japan, this license will
extend to Japan.
AMERICAN DENTAL DANVILLE ENGINEERING, INC.
TECHNOLOGIES, INC.
/S/ Xxx X. Xxxxxxx /s/ Xxxx Fernwood
President and Chief Executive Officer President and Chief Executive Officer
Date: October 18, 1997 Date: October 18, 1997
