PATENT LICENSE AGREEMENT
This Agreement by and between Palomar Medical Technologies, Inc. a
corporation organized and existing under the laws of the State of Delaware
having its principal place of business at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (hereinafter designated "LICENSEE") and Patlex Corporation,
a corporation organized and existing under the laws of the Commonwealth of
Pennsylvania, having its principal place of business at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ (hereinafter designated "PATLEX").
WHEREAS, ▇▇▇▇▇▇ ▇▇▇▇▇, an individual residing at ▇.▇. ▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ (hereinafter designated "▇▇▇▇▇") is the owner, along
with PATLEX, of various patents in the United States and Canada relating to
lasers and laser systems. Such patents are listed in Exhibit "A" annexed hereto;
and
WHEREAS, ▇▇▇▇▇ has granted to PATLEX the exclusive right to license
others under any and all of the aforesaid ▇▇▇▇▇ patents; and
WHEREAS, LICENSEE desires to obtain a license from PATLEX under the
aforesaid ▇▇▇▇▇ patents; and
WHEREAS, it is the intention of the parties that this Agreement
prescribe the rights and obligations among the parties and ▇▇▇▇▇ regarding all
patents issued to or partially owned by ▇▇▇▇▇ relating to lasers and laser
systems and which are licensable by PATLEX; and
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WHEREAS, PATLEX desires to license LICENSEE under the aforesaid ▇▇▇▇▇
patents;
NOW, THEREFORE, PATLEX and LICENSEE agree as follows:
ARTICLE I - DEFINITIONS
For the purposes of this Agreement, the terms specified shall have the
meanings as defined below:
A. "Subsidiary"
Subsidiary shall mean a corporation, company or other entity,
foreign or domestic, at least fifty percent (50%) of whose
outstanding shares or securities (representing the right to
vote for the election of directors or other managing
authority) are, now or hereafter, owned or controlled by
LICENSEE. Whenever the term LICENSEE is used throughout this
Agreement, it is intended to include Subsidiaries of LICENSEE
unless such inclusion would be inappropriate to this
Agreement. A complete list of LICENSEE's Subsidiaries as of
the Effective Date of this Agreement is annexed hereto as
Exhibit "B."
B. "Licensed Patents"
Licensed Patents shall mean the patents set forth in Exhibit
"A," and all reissues and renewals thereof. It shall not
include other inventions of ▇▇▇▇▇ or PATLEX or patents based
on applications filed subsequent to the Effective Date of this
Agreement and not relating back to a patent set forth in
Exhibit "A."
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C. "Low Power Laser Tube"
Low Power Laser Tube shall mean a sealed gas-filled laser tube
having an output power of one (1) Watt or less, with or
without optical elements at the ends thereof, which is not a
staple article or commodity of commerce suitable for
substantial noninfringing use but is especially made or
especially adapted for use in a gas discharge laser or laser
system and which is sold or leased other than as part of a
laser or laser system.
D. "High Power Laser Tube"
High Power Laser Tube shall mean a sealed gas-filled laser
tube other than a Low Power Laser Tube, with or without
optical elements at the ends thereof, which is not a staple
article or commodity of commerce suitable for substantial
noninfringing use but is especially made or especially adapted
for use in a gas discharge laser or laser system and which is
sold or leased other than as part of a laser or laser system.
E. "Licensed Laser"
Licensed Laser shall mean the royalty base items of all
lasers, laser systems and Low and High Power Laser Tubes
manufactured, used, leased or sold by LICENSEE which infringe
(see 35 U.S.C. 271) any one or more of the valid claims of any
Licensed Patent and upon which the requisite royalties have
accrued as a royalty under this Agreement.
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F. "Excluded Uses"
Excluded Uses shall mean any and all uses of Licensed Lasers
for the manufacture or mastering of laser discs, compact
discs, laser memories, or similar products on which a laser or
laser system is used to record sound, visual matter, or data.
G. "Net Selling Price"
Net Selling Price shall mean the price at which LICENSEE
invoices the sale or lease of Licensed Lasers to its
customers, less any reasonable charges for packing, shipping,
installation, import duties, brokerage, and use or sales
taxes. It is further understood and agreed that in respect of
inter-company sales between the LICENSEE and its related
companies, the Net Selling Price shall mean the price at which
the LICENSEE ordinarily sells to its distributors under
similar circumstances. In such event no royalty shall accrue
or be payable in respect of any subsequent resale of such
equipment to a third party.
H. "Effective Date"
The Effective Date of this Agreement shall be January 1, 1992.
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ARTICLE II - PATENT RIGHTS GRANTED
A. Licenses and Immunities
1. Lasers and Laser Systems
PATLEX hereby grants to LICENSEE a non-exclusive,
worldwide license to make, use, lease, or sell lasers
and laser systems which would infringe any valid
claim of one or more of the Licensed Patents upon
which royalties are accrued under this Agreement,
provided such lasers and laser systems are not used
or intended for use in Excluded Uses. All of the
Licenses Patents are covered by this Agreement at the
specific request of LICENSEE in preference to
licensing less than all of the patents which PATLEX
was willing to do.
This Agreement does not apply to, nor require royalty
payments for, components of lasers and laser systems,
which components are staple articles or commodities
of commerce suitable for substantial noninfringing
use, when such components are sold by LICENSEE other
than as part of a laser or laser system.
2. Low Power Laser Tubes
(a) License
PATLEX hereby grants to LICENSEE a
non-exclusive, worldwide license under U.S.
Patent No. 4,704,583 to make, use, lease or sell
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Low Power Laser Tubes which would infringe any
valid claim of U.S. Patent No. 4,704,583
provided:
i) such Low Power Laser Tubes are not used or
intended for use in Excluded Uses, and
ii) LICENSEE's customer either resells the Low
Power Laser Tube as part of a Larger System or
uses it for its own internal use. For purposes
of this Article II, Section A, subsection 2, a
"Larger System" shall mean a system including a
Low Power Laser Tube, in which at least fifty
percent (50%) of the selling price of the system
is attributable to other than the Low Power
Laser Tube and associated power supply.
PATLEX hereby covenants not to ▇▇▇ customers of
LICENSEE under U.S. Patent No. 4,704,583 for
using Low Power Laser Tubes licensed under this
Article II, Section A, subsection (2)(a) upon
which the requisite royalties are accrued.
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(b) Immunity
LICENSEE is hereby granted an immunity from suit
under the Licensed Patents with regard to the
sale of a Low Power Laser Tube to a customer who
resells said Low Power Laser Tube without
incorporating the same into a Larger System. In
such circumstances, PATLEX reserves the right to
pursue LICENSEE's customer for royalties under
the Licensed Patents on said Low Power Laser
Tube and all equipment added thereto. However,
LICENSEE may, at its discretion, pay PATLEX a
fee equal to the amount set forth in Article
III, Section B, subsection (2), and such payment
shall relieve the customer of any obligation to
pay a royalty to PATLEX for said Low Power Laser
Tube.
3. High Power Laser Tubes LICENSEE is hereby granted an
immunity from suit under the Licensed Patents with
regard to the sale of High Power Laser Tubes. LICENSEE
shall pay PATLEX a fee equal to the amount set forth in
Article III, Section B, subsection (2) for such immunity
and such payment shall relieve LICENSEE's customer of
any obligation to pay a royalty to PATLEX for said High
Power Laser Tube. PATLEX expressly reserves the right to
pursue LICENSEE's customer for royalties under the
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Licensed Patents on any equipment added to said High
Power Laser Tube that taken together with such tube
would infringe any valid claim of a Licensed Patent.
B. Customer Use
PATLEX hereby covenants not to ▇▇▇ customers of LICENSEE for
using lasers and laser systems sold or leased by LICENSEE upon
which the requisite royalties are accrued provided such lasers
and laser systems are not used in Excluded Uses. This covenant
does not extend to customers who incorporate such lasers and
laser systems into new systems, the use of which infringes U.S.
Patent No. 4,161,436, and who sell such new systems.
C. Release of Past Infringement:
(1) Optically Pumped Lasers -
U.S. Patent No. 4,053,854 Payment of the requisite
royalties by LICENSEE under Article III, Section A,
subsection (1) hereof shall be in full settlement of any
claim of infringement liability arising under U.S.
Patent No. 4,0453,845 incurred prior to the Effective
Date of this Agreement.
(2) Use Patent -
U.S. Patent No. 4,161,436 Payment of the requisite
royalties by LICENSEE under Article III, Section A,
subsection (1)
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hereof shall be in full settlement of any claim of
infringement liability arising under U.S. Patent No.
4,161,436 incurred prior to the Effective Date of this
Agreement and shall release customers of the LICENSEE
for the use of Licensed Lasers leased or purchased from
LICENSEE prior to the Effective Date hereof, the use of
which would infringe any valid claim of U.S. Patent No.
4,161,436. PATLEX will not ▇▇▇ any customer of LICENSEE
for the use of Licensed Lasers purchased or leased from
the LICENSEE, provided that such uses are not Excluded
Uses. The aforesaid covenant does not extend to
customers who incorporate Licensed Lasers into new
systems the use of which infringes any valid claim of
U.S. Patent No. 4,161,436 and sell such new systems.
(3) Other Patents
Except as provided in Article II, Section C, subsections
(1) and (2) LICENSEE represents that it has not sold or
leased any lasers or laser systems prior to the
Effective Date of this Agreement, the manufacture, use
or sale of which would infringe any valid claim of U.S.
Patent No. 3,388,314; 3,562,662; 3,576,500; 3,586,998;
4,704,583 or 4,746,201 or Canadian Patent No. 907,110.
Accordingly, no release for past infringement of these
seven (7) patents is
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provided and no payment for past infringement of these
seven (7) patents is required.
ARTICLE III - ROYALTY PAYMENTS
A. Past Infringement
U.S. Patent NO. 4,053,845
U.S. Patent No. 4,161,436
Within thirty (30) days of the execution of this Agreement,
LICENSEE shall pay to PATLEX the sum of Nine Thousand Eight
Hundred Dollars ($9,800.00). This sum is equivalent to five
percent (5%) of the Net Selling Price of all Licensed Lasers
sold or leased by LICENSEE, the manufacture, ▇▇▇ or sale of
which would infringe any valid claim of U.S. Patent No.
4,053,845 or 4,161,436.
B. Future Royalty Payments
(1) Optically Pumped Lasers -
U.S. Patent No. 4,053,845
LICENSEE shall pay to PATLEX a royalty of five percent
(5%) of the Net Selling Price for all Licensed Lasers
sold or leased by LICENSEE from the Effective Date of
this Agreement to the expiration of U.S. Patent NO.
4,053,845, the manufacture, use or sale of which would
infringe any valid claim of U.S. Patent No. 4,053,845.
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(2) Gas Discharge Lasers -
U.S. Patent No. 4,704,583
LICENSEE shall pay to PATLEX a royalty of five percent
(5%) of the Net Selling Price for all Licensed Lasers
sold or leased by LICENSEE from the Effective Date of
this Agreement to the expiration of U.S. Patent
4,704,583, the manufacture, use or sale of which would
infringe any valid claim of U.S. Patent No. 4,704,583.
(3) Use Patent -
U.S. Patent No. 4,161,436
(a) LICENSEE shall pay to PATLEX a royalty of five
percent (55%) of the Net Selling Price for all Licensed
Lasers sold or leased by LICENSEE from the Effective
Date of this Agreement to the expiration date of U.S.
Patent NO. 4,161,436, the use of which would infringe
any valid claim of U.S. Patent No. 4,161,436.
(b) LICENSEE shall have the right to use lasers, laser
systems and Low and High Power Laser Tubes for its own
internal use provided such lasers, laser systems and Low
and High Power Laser Tubes are not used for Excluded
Uses and are manufactured by LICENSEE or are purchased
from a vendor who is licensed by PATLEX under all of the
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Licensed Patents applicable thereto and, if manufactured
by LICENSEE, LICENSEE pays the requisite royalties or
fees based upon the equivalent Net Selling Price thereon
and, if purchased from a licensed vendor, said licensed
vendor paid the requisite royalties or fees thereon. If
LICENSEE purchases a laser, laser system, or Low or High
Power Laser Tube for its internal use from a vendor not
licensed y PATLEX, LICENSEE shall pay to PATLEX a
royalty of six percent (6%) of the purchase price of
said laser, laser system or Low or High Power Laser
Tube.
(4) ▇▇▇▇▇▇▇▇'▇ Angle Window -
U.S. Patent No. 4,746,201
LICENSEE shall pay to PATLEX a royalty of three and
one-half percent 3 1/2%) of the Net Selling Price for
all Licensed Lasers sold or leased by LICENSEE from the
Effective Date of this Agreement to the expiration date
of U.S. Patent No. 4,746,201, the manufacture, use or
sale of which would infringe any valid claim of U.S.
Patent No. 4,746,201.
(5) Other Patents
No additional royalty shall accrue for any Licensed
Laser sold or leased by LICENSEE, the manufacture, use
or sale of which would infringe
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any valid claim of any patent listed in Exhibit "A" and
not described heretofore in Article III, Section B,
subsections (1) to (4) hereof.
(6) Foreign Sales
Notwithstanding the royalty rates set forth in Article
III, Section B, if the sale or lease of any Licensed
Laser is directly to an end user in a country other than
the United States or to a distributor who warrants in
writing to LICENSEE that the end user is in a country
other than the United States, then the royalty rate
shall be reduced to two percent (2%) of the Net Selling
Price for said sale or lease.
C. Multiple Patents
In the event that the manufacture, lease, sale or use of a
Licensed Laser by LICENSEE infringes a valid claim or more than
one Licensed Patent, then the royalty payable to PATLEX shall be
computed in accordance with the greatest of the applicable
royalty rates, if they are different, with regard to those
portions of the Licensed Laser wherein the royalty bases as
defined herein overlap. With regard to the remaining portions of
the Licensed Laser, the individual royalty rates still apply.
D. When Accrued
Royalties as aforesaid shall accrue hereunder when income from
the lease of Licensed Lasers shall have
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been received or invoiced by LICENSEE, whichever is sooner, and
when the sale of Licensed Lasers shall have been invoiced by
LICENSEE to its customers or if invoices are not issued, when
Licensed Lasers shall have been shipped by LICENSEE.
E. Trial Shipments
With respect to Licensed Lasers shipped to customers under lease
or on a trial basis, LICENSEE shall have six (6) months from the
date of such shipment to designate each such transaction as a
sale or lease, unless fifty percent (50%) or more of the
purchase price shall have been paid to LICENSEE in which event
the transaction shall be deemed a sale.
F. Resale
LICENSEE shall have the right to acquire and resell lasers,
laser systems, and Low and High Power Laser Tubes manufactured
by others. If the laser, laser system or Low or High Power Laser
Tube is acquired from a vendor who is licensed by PATLEX under
all of the patents in Exhibit "A" applicable thereto and pays
the requisite royalties or fees to PATLEX, then LICENSEE need
not pay royalties hereunder for the laser, laser system, or Low
or High Power Laser Tube so acquired with respect to which
royalties or fees have been previously paid. LICENSEE shall pay
all applicable royalties required under Article III, Section B
hereof for whatever additional royalty base
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items are combined with said so acquired laser or laser system.
Where LICENSEE combines additional royalty base items with such
a Low or High Power Laser Tube, LICENSEE' payment of additional
royalties for the additional royalty base items shall be
determined in accordance with the provisions of Article II,
Section A, subsections 2 and 3.
G. Adjustments
LICENSEE shall have the right to adjust royalties payable
hereunder for returns, bona fide price reductions and allowances
of Licensed Lasers sold or leased by LICENSEE on which the
requisite royalties or fees shall previously have been paid
hereunder.
H. Calculations
Subject to provisions specifically herein set forth, all
calculations and procedures related tot he determination of
royalties and fees payable hereunder shall be in accordance with
recognized standards of good accounting practice consistently
applied.
ARTICLE IV - ROYALTY BASE
For purposes of paying and/or computing royalties and fees hereunder the
following shall apply:
A. Optically Pumped Lasers
U.S. Patent No. 4,053,845
The royalty base shall include the lasing medium, and means for
containing the same where applicable, a
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bright pumping light source (save that if such light source is a
gas discharge laser the appropriate royalty called for under
Article III, Section B, subsection (2) hereof shall apply), and
means (including power supply, lamp and optical system) for
activating and using same, together with at least any and all of
the following functionally combined components:
(1) means for mounting the lasing medium and the bright
pumping light source to enable the desired functional
relationship, for example including base and housing;
(2) means that enable the optically pumped medium to emit
light in a wave train that has a sharply rising
intensity with an intensity rise time of less than
approximately 10-7 seconds;
(3) means for conveying the stimulating light beam through
the amplification region including mirrors employed for
this purpose; and
(4) means integral with the apparatus of this Article IV,
Section A hereof such as meters, shutters, controls and
cooling system.
B. Gas Discharge Lasers -
U.S. Patent No. 4,704,583
The royalty base shall include the lasing medium if supplied by
the LICENSEE, including means for containing the same and means,
including power supply, for activating same, together with at
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least any and all of the following functionally combined
components:
(1) means for producing an electrical discharge in the
lasing medium and for delivering a gas discharge mixture
to the discharge region at partial and total pressure
such that a population inversion is initiated in the
lasing medium;
(2) means for conveying the stimulating light beam through
the amplification region including mirrors employed for
this purpose;
(3) means for mounting the lasing medium and electrical
discharge producing means to enable the desired
functional relationship, for example including base and
housing; and
(4) means integral with the apparatus of this Article IV,
Section B hereof such as meters, shutters, controls and
cooling systems.
C. Use Patent -
U.S. Patent No. 4,161,436
The royalty base shall include all assemblies, sub-assemblies,
components, and portions thereof necessary to produce coherent
light, to transport such light to a particular point on a
workpiece, and to control the physical parameters of such light
in such a way as to make it efficient in performing its intended
end use.
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▇. ▇▇▇▇▇▇▇▇'▇ Angle -
U.S. Patent No. 4, 746,201
The royalty base shall include: a source of light rays including
means to contain and energize said source; means for directing
certain unpolarized light rays from said source to multiply
traverse a predetermined path; an optical element having a first
surface; and means for mounting said optical element to
intersect said unpolarized light rays with a line perpendicular
to said first surface inclined to said path substantially at
▇▇▇▇▇▇▇▇'▇ Angle thereby passing one polarization of said light
rays and reflecting some of the light rays of the other
polarization upon each traversal of said predetermined path.
E. Other Patents
The royalty base shall include any laser or part thereof
conforming to any valid claim contained in any of the patents
cited in Exhibit "A" not described in Sections A through D of
this Article.
ARTICLE V - MARKING
LICENSEE shall ▇▇▇▇ in appropriate locations all Licensed Lasers
manufactured and the packages and containers in which such Licensed Lasers are
sold, leased or shipped, and all advertisements, literature and promotional
material in which such Licensed lasers shall be mentioned or described, as
follows: "Licensed by PATLEX Corporation Under U.S. Patent
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No(s). _______." Here LICENSEE shall insert the appropriate U.S. Patent No. or
Nos. applicable to the equipment so marked, with the exception that LICENSEE
shall not be required to include U.S. Patent No. 4,161,436 in its marking. Said
marking requirement may from time to time be altered by PATLEX as the applicable
patent law and practice may require.
ARTICLE VI - DURATION OF AGREEMENT
A. Expiration
This Agreement shall continue in full force and effect until the
expiration of the last of the Licensed Patents unless this
Agreement is sooner terminated as herein provided.
B. Termination
If either party to this Agreement should default in the
performance of any of the terms of this Agreement (including a
breach of this Agreement which can be cured), the non-defaulting
party may terminate this Agreement by providing written notice
of termination to the defaulting party and the termination shall
be effective thirty (30) days from said notice unless the
defaulting party cures such default within said thirty (30) day
period. Should LICENSEE terminate this Agreement, said notice of
termination shall be accompanied by a statement of all
royalty-based activities performed by LICENSEE on which
royalties or fees are due hereunder for such period as had
elapsed
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since the last report under the Licensed patents. Said statement
shall be accompanied by payment of all monies reported as being
due.
ARTICLE VII - RECORDS AND REPORTING
A. Within thirty (30) days after the close of each calendar
quarter, LICENSEE shall deliver to PATLEX a statement of all
royalty-based activities performed by LICENSEE on which
royalties or fees are due hereunder for such calendar quarter,
and each such statement shall generally be in accord with the
sample royalty reports annexed hereto as Exhibit "C" and "D" and
shall also contain such other information as PATLEX may
reasonably require.
B. Simultaneously with the delivery of each statement covering any
calendar quarter, LICENSEE shall pay to PATLEX all monies
reported as being due. In the event the monies due are not paid,
interest at the rate of one and one-half percent (1 1/2%) per
month shall be assessed on all amounts due and unpaid. It is
expressly understood by LICENSEE that it is a breach of this
Agreement not to pay all monies reported as being due. It is
expressly understood that PATLEX, by accepting interest on all
unpaid amounts, does not waive any rights, powers or privileges
under this Agreement.
C. LICENSEE shall keep at its principal place of business accrue
and complete records of all Licensed Lasers manufactured,
leased, sold, used or otherwise delivered to other parties by
LICENSEE and of all details in connection with the aforesaid
activities necessary to enable LICENSEE to comply with this
Agreement. PATLEX shall have the right, upon ten (10) days
written notice and during regular business hours, and at the
expense of PATLEX, and not more than once in each calendar year,
to have an independent auditor, audit at the place of business
of LICENSEE or other place agreeable to the parties, the
aforesaid records, and to report compliance or non-compliance
with the payment, record maintenance and all other reporting
requirements herein.
D. Audit
If an audit shall reveal that in each of two successive years
the LICENSEE has made an error of 10% or more in its favor in
any payment due to PATLEX, the LICENSEE shall be obligated to
pay the audit fee in respect of such audits.
ARTICLE VIII - WAIVER
A. Waiver in Writing
During the life of this Agreement, neither party shall be deemed
to have waived any right, power or privilege under this
Agreement or any provision thereof unless
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such waiver shall have been duly executed in writing and
acknowledged by the party to be charged with such waiver. B. No
Implied Waiver The failure of PATLEX to act or exercise its
rights hereunder upon the breach of any of the terms or
conditions hereof by LICENSEE shall not be construed as a waiver
of such breach, nor shall it prevent PATLEX from hereafter
enforcing strict compliance with any and all of the terms and
conditions herein set forth.
ARTICLE IX - TRANSFERABILITY
Notwithstanding anything herein to the contrary, this Agreement, and all
of the rights, licenses and obligations contained herein, may not be transferred
without permission in writing by PATLEX, which permission shall not be
unreasonably withheld.
ARTICLE X - ACQUISITION
If LICENSEE shall acquire in whole or in part the laser business of an
unlicensed third party engaged in the manufacture, lease, sale or use of lasers,
laser systems, or Low or High Power Laser Tubes, neither the acquisition nor
this Agreement shall extinguish the third party's liability for past
infringement, but the same shall be assumed by LICENSEE.
If LICENSEE shall acquire in whole or in part the laser business of a
third party which was previously licensed by PATLEX
21
under the Licensed Patents applicable to such laser business and said third
party has made all required royalty and fee payments to PATLEX, then LICENSEE
shall have no liability for acts of said party covered by said previous license
and the terms of this Agreement shall apply to all further transactions of the
laser business so acquired.
ARTICLE XI - COMMUNICATIONS
Any payment, notice or other communication required by, or permitted to
be made by or given to, either party pursuant to this Agreement shall be sent to
such party by registered, certified or express mail, postage prepaid, or prepaid
courier service, addressed to such party at its address set forth below, or to
such other addresses as such party shall designate by written notice given to
the other party, and shall be deemed to have been made, given or provided on the
date of mailing. The addresses are as follows:
PATLEX: for royalty statements and payments -
Patlex Corporation
Chief Financial Officer
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
for all other correspondence -
General Counsel
Patlex Corporation
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Palomar Medical Technologies, Inc.:
▇▇. ▇▇▇▇ ▇▇▇▇▇, President
Palomar Medical Technologies, Inc.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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ARTICLE XII - MOST FAVORED LICENSEE
If subsequent to the Effective Date of this Agreement another
manufacturer of lasers, laser systems, or Low or High Power Laser Tubes
similarly situated to LICENSEE is granted a license by PATLEX which provides to
said another manufacturer a combined royalty rate and royalty base materially
more favorable to said another manufacturer with respect to any of the Licensed
Patents than that provided herein to LICENSEE for lasers, laser systems and Low
or High Power Laser Tubes sold or leased in the United States, then LICENSEE
may, at its option, adopt the subsequent license in its entirety, mutatis
mutandis, as of the effective date of such subsequent license. PATLEX shall
notify LICENSEE of any such subsequent license and provide LICENSEE an
opportunity to exercise the option provided herein.
ARTICLE XIII - GOVERNMENT SALES
No royalty or fee shall accrue or be payable in respect of sales or
leases of lasers, laser systems, or Low or High Power Laser Tubes authorized and
consented to by the Government of the United States or its agencies. This
provisions shall not inhibit PATLEX from seeking such compensation as the law
permits from the Government of the United States or its agencies arising out of
such sales or leases.
Since the parties recognize that LICENSEE may have difficulty in
determining when sales to certain entities may constitute sales to the United
States government which are excludable from the payment of royalties and fees
under this
Article XIII, PATLEX agrees that lasers, laser systems, or Low or High Power
Laser Tubes sold by LICENSEE will be excludable under this Article XIII if any
of the following conditions are met:
A. If the sale is made directly to the U.S. Government or an agency
or research facility thereof;
B. If the sale is made to a U.S. government contractor who lists
the contract number under which the sale is made on the purchase
order;
C. If the sale is made to a U.S. government contractor who provides
a written statement that the sale is under a U.S. government
contract which provides authorization and consent to the
contractor's purchase and use of the equipment; and
D. If the sale is made to a University which provides a written
statement that the equipment has been purchased with U.S.
government funds under a grant requiring the purchase of a
laser, laser system or Low or High Power Laser Tube such as the
one supplied by LICENSEE.
If, however, a court of competent jurisdiction from which no appeal can
be or has been taken, shall determine that the Government of the United States
is not liable for the purchase, use or lease of such lasers, laser systems, or
Low or High Power Laser Tubes by reason of the failure or inapplicability of
said authorization and consent, or a determination that the Government of the
United States is not a real party in interest or for any other reason indicating
that the LICENSEE is the appropriate party from which a royalty or fee should be
sought, PATLEX shall
23
notify LICENSEE accordingly and with the next quarterly report and payment
required under Article VII hereof, LICENSEE shall include a full statement and
payment as required.
ARTICLE XIV - REPRESENTATIONS
PATLEX and ▇▇▇▇▇ represent that PATLEX has the full rights and power to
grant the licenses and releases set forth in this Agreement, and that there are
no outstanding agreements, assignments or encumbrances inconsistent with the
provisions of this Agreement. PATLEX and ▇▇▇▇▇ further represent that there are
no patent applications pending in any Patent Office in the world relating to
lasers, laser systems, or Low or High Power Laser Tubes which are fully or
partially owned by ▇▇▇▇▇ and which are licensable by PATLEX. PATLEX represents
that it has the exclusive right to license others under the Licensed patents and
to collect royalties and fees under the Licensed Patents on behalf of all
entities entitled to receipt of the same. PATLEX makes no other representation,
express or implied, nor does PATLEX 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.
ARTICLE XV - HEADINGS
The headings of the several articles and sections are inserted for
convenience of reference only and are not intended to be a part of or to affect
the meaning or interpretation of this Agreement.
24
▇▇▇▇▇▇ ▇▇▇▇▇ acknowledges that he has read, approves and accepts this
Agreement between LICENSEE and PATLEX CORPORATION as set forth above, including
the patent rights granted herein.
▇▇▇▇▇▇ ▇▇▇▇▇
Date: February 13, 1992 By: /s/
-------------------------
▇▇▇▇▇▇ ▇▇▇▇▇
IN WITNESS WHEREOF, the parties hereto affix their respective hands as
of the date indicate:
PATLEX CORPORATION
Date: February 12, 1992 By: /s/
-------------------------
J. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
PALOMAR MEDICAL TECHNOLOGIES, INC.
Date: February 7, 1992 By: /s/
-------------------------
▇▇▇▇ ▇▇▇▇▇
25
EXHIBIT "A"
-----------
Expired U.S. Patents
--------------------
U.S. Patent No. 3,388,314 (expired June 11, 1985)
"Apparatus for Generating Radiation of Frequencies
Higher than those of Light"
U.S. Patent No. 3,526,662 (expired February 9, 1988)
"Laser Utilizing Collision Depopulation"
U.S. Patent No. 3,576,500 (expired April 27, 1988)
"Low Lever Laser with Cyclic Excitation and
Relaxation"
U.S. Patent No. 3,586,998 (expired June 22, 1988)
"Pulsed Laser with Output Control"
Unexpired U.S. Patents:
----------------------
U.S. Patent No. 4,053,845 (expires October 11, 1994)
"Optically Pumped Laser Amplifier"
U.S. Patent No. 4,161,436 (expires July 17, 1996)
"Method of Energizing a Material"
U.S. Patent No. 4,704,583 (expires November 3, 2004)
"Light Amplifier Employing Collisions to Produce
a Population Inversion"
U.S. Patent No. 4,746,201 (expires May 24, 2005)
"Polarizing Apparatus Employing an Optical Element
Inclined at ▇▇▇▇▇▇▇▇'▇ Angle"
Expired Canadian Patent:
-----------------------
Canadian Patent No. 907,110 (expired August 8, 1989)
"Light Generating and Amplifying Apparatus"
EXHIBIT "B"
LIST LICENSEE'S SUBSIDIARIES
None
EXHIBIT "C"
Royalty Report of Palomar Medical Technologies, Inc.
For Period From to
----------- -------------
Lasers and Laser Systems
Type --
*Total Gas, Use, Domestic
Product # Units Total Royalty Optical- or Royalty
Model-Type Sold Sales Price Base $ Pumped Export Rate % Due $
---------- ------- ----------- ------- --------- --------- ------- -----
* If a different royalty rate applies to portions of a sale or
group of sales, please separate the royalty base of such sales
according to the different royalty rates.
EXHIBIT "D"
-----------
Royalty Report of Palomar medical Technologies, Inc.
For Period From to
Sealed Gas-Filled Laser Tubes
-----------------------------
*Total Domestic
Product Power # Units Royalty or Royalty
Model-Type Output Sold Customer Base $ Export Rate % Due $
---------- ------- -------- -------- --------- --------- ------- -----