PATENT LICENSE AGREEMENT
THIS AGREEMENT ENTERED INTO AND EFFECTIVE THIS 6th day of October, 1999
by and between Xxxxx X. Xxxxxxxx, of 0000 Xxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxx
00000-0000 ("Xxxxxxxx"), and Xxxxxxxx Resonance Enterprises, Inc., a Florida
corporation, having an address at 0000 Xxxxxxx Xxxx Xxxx., #000, Xxxx Xxxxx,
Xxxxxxx 00000 ("Enterprises").
Xxxxx X. Xxxxxxxx is the owner of United States Applications Serial Nos.
08/440,896, 09/148,435, and 09/386,696, concerning certain treatments and
devices employing magnetic field therapy, and other country counterparts thereof
(the "Patents"). The invention concerns a variety of related devices and methods
of treatment using magnetic fields (the "Products" and "Methods").
Enterprises is a corporation formed by Xxxxxxxx to manufacture, market,
sell, and distribute Products and to practice and have practiced Methods, and to
sublicense all the foregoing. As part of the consideration to be received by
Xxxxxxxx from Enterprises, Xxxxxxxx has agreed to license Enterprises to
manufacture, use and sell various Products and to practice or have practiced
Methods covered by the Patents.
NOW, THEREFORE, the parties do hereby agree as follows:
ARTICLE I
Grant of Rights
Section 1.01 Subject to the conditions of this Agreement, Xxxxxxxx
hereby grants to Enterprises the exclusive worldwide right and license to
manufacture, use and sell the Products and to practice or have practiced the
Methods, including right to sublicense all of the foregoing.
Section 1.02 Xxxxxxxx acknowledges that Enterprises may arrange for
manufacture and distribution of the Products or practice of Methods by other
companies.
ARTICLE II
Payment and Records
Section 2.01 Enterprises agrees to pay royalties under this Agreement to
Xxxxxxxx upon issuance of patents in the various countries as follows:
1. U.S. Application Serial No. 08/440,896 and other country
counterparts: A royalty of three (3%) percent of gross
revenues, including sales for Products or Methods sold, used
or practiced, which are covered by patents issuing thereon in
each country.
1
2. U.S. Application Serial No. 09/148,435 and other country
counterparts: A royalty of four (4%) percent of gross
revenues, including sales for Products or Methods sold, used
or practiced, which are covered by patents issuing thereon in
each country.
3. U.S. Application Serial No. 09/386,696 and other country
counterparts: A royalty of four (4%) percent of gross
revenues, including sales for Products or Methods sold, used
or practiced, which are covered by patents issuing thereon in
each country.
Section 2.02 For any revenues obtained by any sublicense, the above
royalty payments shall apply and be due and payable by Enterprises based on the
gross revenues (as set forth for Enterprises) received by each sublicensee.
Enterprises agrees to include adequate terms and conditions in such sublicense
agreements to ensure compliance with the terms and conditions of this Agreement.
Section 2.03 Enterprises shall maintain business records of all sales
and receipts and shall require sublicensees to do the same, and Xxxxxxxx shall
have the right, on reasonable notice, to audit such records, together with
accountants of his choice. Enterprises shall impose the same requirements on any
sublicensee, and shall audit sublicensee records upon Xxxxxxxx'x request. In the
event that any audit of Enterprises or a sublicensee reveals an underpayment of
more than five percents of royalties due, Enterprises shall pay the costs of the
audit, the amounts due and unpaid, and an additional ten percent of the amounts
due and unpaid.
ARTICLE III
Representations and Warranties
Section 3.01 Xxxxxxxx warrants that he is the owner of all rights,
title, and interest to the United States Applications Nos. 08/440,896,
09/148,435, and 09/386,696, including other country counterparts and that he has
the right to enter into this Agreement and to convey the rights herein.
Section 3.02 Enterprises represents and warrants that it is authorized
to enter into this Agreement.
ARTICLE IV
Assignment of Rights
Section 4.01 Enterprises' rights under this Agreement shall not be
assigned to any person or corporation succeeding to its business as a result of
sale, consolidation, reorganization or otherwise without the expressed consent
and acceptance in writing by Xxxxxxxx.
2
ARTICLE V
Patent Marking
Section 5.01 Enterprises agrees to xxxx or require marking of all
Products sold or literature, brochures or other written materials used with the
Methods practiced by it or any sublicensee under this Agreement with the words
"US Patent (applicable numbers upon issuance").
ARTICLE VI
Term and Termination
Section 6.01 Unless otherwise terminated, the term of this Agreement
shall be for five (5) years from the date of execution of this agreement and may
be renewed with the consent of both parties.
Section 6.02 This Agreement may also be terminated at any time by the
written consent of both Xxxxxxxx and Enterprises.
Section 6.03 Xxxxxxxx shall have the right to terminate this Agreement
upon the occurrence of any material breach of this Agreement by Enterprises.
Xxxxxxxx shall give Enterprises written notice of its intention to terminate
this Agreement specifying the grounds for termination. The termination shall be
effective sixty (60) days after the receipt of such notice by Enterprises unless
the breach is cured before the expiration of the sixty (60) day period.
Section 6.04 If for any reason Enterprises during the term of this
Agreement shall cease to exist as a business entity, the Agreement shall
automatically be terminated, and all rights licensed revert to Xxxxxxxx.
ARTICLE VII
Controlling Law
Section 7.01 This Agreement and all conditions of this Agreement shall
be construed in accordance with the laws of the United States and the State of
Florida.
ARTICLE VIII
Notice
Section 8.01 Any notice or report required to be given by this Agreement
shall be in writing and delivered by hand, by commercial courier, or by
facsimile (confirmed by registered or certified mail, postage prepaid),
addressed to:
Xxxxxxxx: Xxxxx X. Xxxxxxxx, 0000 Xxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxx
00000-0000, fax: .(000) 000-0000.
Enterprises: Xxxxxxxx Resonance Enterprises, Inc., 0000 Xxxxxxx Xxxx
Xxxx., #000, Xxxx Xxxxx, XX 00000, fax: (000) 000-0000.
3
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
/s/ Xxxxx X. Xxxxxxxx
---------------------
Xxxxx X. Xxxxxxxx
XXXXXXXX RESONANCE ENTERPRISES, INC.
By: /s/ Xxxxx X. Xxxxxxxx
---------------------
Xxxxx X. Xxxxxxxx
Chairman of the Board & CEO
4
