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EXHIBIT 10.4
PATENT LICENSE AGREEMENT
Agreement by and between
OssaTronics Inc. a corporation organized and existing under the laws of
Georgia, having its principle place of business at 0000 Xxxxxxxxx Xxxxx,
Xxxxxxxxx, XX 00000, XXX (hereafter designated "LICENSEE") duly represented by
it's president Xx. Xxxx Xxxxxxx
and
HMT High Medical Technologies GmbH, a company organized and existing under the
laws of the Federal Republic of Germany, having its principle place of business
in Xxxxxxxxxxxxxxx 00, X-00000 Xxxx, Xxxxxxx (hereafter designated "HMT") duly
represented by it's General Manager Xx. Xxxxxxx Xxxx
Whereas,
HMT has purchased from the initial inventors VVMI of Sofia, Bulgaria the United
States patent No. 4,979,501 and the Canadian patent No. 1.330.580 relating to
the method and mechanism for the treatment of bone pathologies.
Whereas,
LICENSEE desires to obtain a license from HMT under the aforesaid US and
Canadian patents
Whereas,
it is the intention of the parties that this Agreement prescribes the rights
and obligations among the parties regarding the aforesaid patents which are
licensable by HMT; and
Whereas,
HMT desires to licence LICENSEE under the aforesaid patents;
Now,
therefore, HMT and LICENSEE agree as follows:
ARTICLE 1
Patent Rights Granted
HMT hereby grants to LICENSEE a non-exclusive, license to make, use, lease, or
sell shock wave equipment for medical treatment which would infringe any valid
claim of the licensed patents upon which royalties are to be payed under this
Agreement.
Licensee is hereby granted immunity from suit under the licensed patents with
regard to its customers which are relieved of any obligation to pay a royalty
for aforesaid patents.
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ARTICLE 2
Royalty Payment
Within thirty (30) days from the effective date of this agreement, LICENSEE
shall pay to HMT the sum of US $100.000,-- (one hundred thousand).
In addition to the above payment LICENSEE shall pay to HMT a royalty of US
$25.000,-- (Twenty five thousands) for each OssaTron unit sold or leased by the
LICENSEE from the effective date of this agreement to the expiration of the US
patent No. 4.979.501 and the Canadian patent No. 1.330.508 respectively.
Within thirty (30) days after the close of each calendar quarter, LICENSEE
shall deliver to HMT a statement of all royalty based activities performed.
Simultaneously with the delivery of each statement, LICENSEE will pay HMT the
royalty due for such quarter.
The royalty of US $25.000,-- for each for each unit purchased from HMT is
included in the unit sales price agreed between HMT and LICENSEE.
ARTICLE 3
Duration of Agreement
This agreement shall continue in full force and effect until the expiration of
the licensed patents unless this agreement is sooner terminated as herein
provided.
If any party to this agreement should default in the performance of any of the
terms of this agreement the non-defaulting party may terminate this agreement
with thirty (30) days notice period.
ARTICLE 4
Transferability
Notwithstanding anything herein to the contrary, this agreement, and all the
rights, license and obligations contained herein, may not be transferred
without permission in writing by HMT, which permission shall not be
unreasonably withheld.
ARTICLE 5
Representation
HMT represents that HMT has the full rights and power to grant the licenses set
forth in this agreement, and that there are no outstanding agreements
inconsistent with the provisions of this agreement.
HMT makes no other representation, expressed or implied, nor does HMT assume
any liability in respect of any infringement of patents or other rights of
third parties due to LICENSEE's operation under the license herein granted.
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ARTICLE 6
Applicable Law
This agreement shall be construed, and the legal relations between the parties
hereto shall be determent, in accordance with the laws of the State of Georgia.
ARTICLE 7
Communications
Any payment, notice or other communication required by, or permitted to be made
or given to, either party pursuant to this agreement shall be sent to such
party to the following addresses:
HMT: HMT
High Medical Technologies GmbH
Xxxxxxxxxxxxxxx 00
X-00000 Xxxx, Xxxxxxx
LICENSEE: OssaTronics Inc.
0000 Xxxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000, XXX
In witness whereof the parties hereto affix their hands respectively as of the
date indicated:
Date: June 3, 1995 By: /s/ Xxxxxxx Xxxx For: HMT
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(Xxxxxxx Xxxx)
Date: June 3, 1995 By: /s/ Xxxx Xxxxxxx For: OssaTronics, Inc.
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(Xxxx Xxxxxxx)
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AMENDMENTS TO PATENT LICENSE AGREEMENT, LITHOTRON
DISTRIBUTORSHIP AGREEMENT AND OSSATRON DISTRIBUTORSHIP AGREEMENT
This agreement is made and entered into this 7th day of August 1996, by and
between HIGH MEDICAL TECHNOLOGIES ENTWICKLUNGS + VERTRIEBS AG, (hereinafter
referred to as "HMT") and, HEALTHTRONICS, INC.:
WITNESSETH:
WHEREAS, HMT and Ossatronics, Inc. have entered into a distributorship
dated November 22, 1994 (hereinafter referred to as the "OssaTron
Distributorship Agreement"); and
WHEREAS, HMT and Ossatronics, Inc. have entered into a Patent License
Agreement dated June 3, 1995 (hereinafter referred to as the "Patent License
Agreement"); and
WHEREAS, OssaTronics, Inc. has merged into HealthTronics, Inc., a Georgia
corporation and the Distributorship Agreement and Patent License Agreement have
been assigned to HealthTronics, Inc.; and
WHEREAS, HMT, Jena, has assigned its interest in the Distributorship
Agreement to HMT, Switzerland; and
WHEREAS, HMT and HealthTronics, Inc. have entered into a Distributorship
Agreement executed January 24, 1996 by HMT; and January 22, 1996 by
HealthTronics, Inc. (hereinafter referred to as the "LithoTron Distributorship
Agreement").
NOW, THEREFORE, in consideration of ten dollars ($10.00) and other good
and valuable consideration, the parties agree as follows:
I
The "Patent License Agreement" shall be amended and changed as follows:
(A) Article 1 of such Agreement is amended, changed and reworded as follows:
ARTICLE 1
Patent Rights Granted
HMT hereby grants to LICENSEE as exclusive license to make, use, lease or
sell shock wave equipment for medical treatment which would infringe any valid
claim of the licensed patents upon which royalties are to be paid under this
Agreement.
Licensee is hereby granted immunity from suit under the licensed patents
with regard to
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its customers which are relieved of any obligation to pay a royalty for
aforesaid patents.
(B) All remaining provisions in the Patent License Agreement shall remain
as originally set forth.
II
The "LithoTron Distributorship Agreement" shall be amended and changed
as follows:
(A) Article 11, paragraph 1 of such agreement is amended, changed and
reworded as follows:
ARTICLE 11
DURATION AND TERMINATION OF AGREEMENT
(1) Unless otherwise provided herein, this agreement is effective for a
term of five years beginning on the date P.M.A. is granted by the F.D.A. Upon
the expiration of the initial five year term, this agreement shall
automatically renew for subsequent five year terms provided that Healthtronics
meets its sales commitment of not less than an average of 20 LithoTrons per
year as averaged over the preceding five year term. If after any five year
term, Healthtronics does not meet such sales commitment, HMT may terminate this
agreement by providing notice of its intent to do so. Such notice shall be
provided by registered or certified mail to the principal place of business of
Healthtronics and shall be provided at least twelve months prior to the
expiration of a five year term then in effect.
III
The "OssaTron Distributorship Agreement" shall be amended and changed
as follows:
(A) ss. 10 paragraph 1 of such agreement shall be amended, changed and
reworded as follows:
ss. 10
DURATION AND TERMINATION OF AGREEMENT
(1) Unless otherwise provided herein, this agreement is effective for a term
of five years beginning on the date P.M.A. is granted by the F.D.A. Upon the
expiration of the initial five year term, this agreement shall automatically
renew for subsequent five year terms provided that Healthtronics meets its sales
commitment of not less than an average of 20 OssaTrons per year as averaged over
the preceding five year term. If after any five year term, Healthtronics does
not meet such sales commitment, HMT may terminate this agreement by providing
notice of
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its intent to do so. Such notice shall be provided by registered or certified
mail to the principal place of business of HealthTronics and shall be provided
at least twelve months prior to the expiration of a five year term then in
effect.
(B) ss. 13 of such agreement shall be amended, changed and reworded as
follows:
ss.13
MANUFACTURING RIGHT
(1) HealthTronics shall have the exclusive right to manufacture the
OssaTron OSA 120 and other subsequent models related thereto, as well as
accessories, spare parts, consumables and disposables related thereto.
(2) HMT shall, within thirty days after receiving a written request,
provide HealthTronics, Inc. with all drawings, technical descriptions,
suppliers and all other matters requested by HealthTronics, Inc. related to
manufacturing the OssaTron OSA 120 so as to enable HealthTronics, Inc. to
manufacture the OssaTron OSA 120.
(3) HealthTronics, Inc. shall pay to HMT a one time fee of $1,000,000 for
the manufacturing know-how, technical drawings, descriptions and other
paperwork and associated documents described in section number III ss.13
(2)herein.
(4) For each OssaTron device manufactured by HealthTronics, Inc. under this
agreement, HealthTronics, Inc. shall pay to HMT a licensing fee of ten percent
(10%) of the HealthTronics, Inc. net selling price.
HMT
BY: /s/ Xxxx-Xxxxx Xxxxxx
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Xxxx-Xxxxx Xxxxxx (Managing Director)
HEALTHTRONICS, INC.
BY: /s/ Xxx X. Xxxxx
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Xxx X. Xxxxx (President)
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