Patent License And Settlement Agreement

EXHIBIT 10.4


PATENT LICENSE AND SETTLEMENT AGREEMENT
BETWEEN


BINKS SAMES CORPORATION, SAMES, S.A.
AND SAMES ELECTROSTATIC, INC.


AND


DURR SYSTEMS GmbH AND BEHR SYSTEMS, INC.


This Patent License and Settlement Agreement ("Agreement") is entered into as of July 10, 1998, by and between Binks Sames Corporation ("Binks"), Sames, S.A. ("SSA") and Sames Electrostatic, Inc. ("SEI") (collectively referred to as "Binks Entities") on one hand, and Behr Systems, Inc. ("Behr") and Durr Systems, GmbH ("Durr") (collectively referred to as "Durr Entities") on the other hand, is in settlement of pending litigation brought by the Durr Entities against the Binks Entities.


1. BACKGROUND


1.1 The Durr Entities own U.S. Patent No. 4,405,086 entitled "DEVICE FOR ATOMIZING LIQUID COLOR" and the related foreign patents identified on Exhibit A ("the Durr Patents").


1.2 Behr has filed suit in the United States District Court for the Eastern District of Michigan in Civil Action No. 97-72744 and Durr has filed suit in Germany against the Binks Entities for infringement of the Durr Patents ("the Lawsuits"). The Lawsuits seek the entry of a permanent injunction and damages for past infringement of the Durr Patents.


1.3 The parties have agreed to settle the Lawsuits and release each other as set forth below.


1.4 The Durr Patents are valid, enforceable and infringed by the PPH 605 and PPH 607 atomizers and bell cups for the PPH 605 and PPH 607 atomizers, all made and/or sold by the Binks Entities.


2. RESOLUTION OF THE PENDING LITIGATION


2.1 Within five (5) business days after the date first written above, the parties and their attorneys will execute and file a Consent Judgment in a form attached hereto as Exhibit B, in both the United States District Court for the Eastern District of Michigan and the applicable court in Germany where the Lawsuits are pending. Said Consent Judgment shall declare the Durr Patents


valid, enforceable and infringed, shall dismiss the Lawsuits with prejudice and shall provide that each party will bear its own attorneys' fees and costs.


2.2 The Durr Entities release the Binks Entities from any and all Claims (as defined in paragraph 2.4) relating to the Durr Patents which have been or could have been asserted in the Lawsuits to the date of this Agreement and covenant not to sue the Binks Entities under such Claims.


2.3 The Binks Entities release the Durr Entities from any and all Claims (as defined in paragraph 2.4) relating to the Durr Patents which have been or could have been asserted in the Lawsuits to the date of this Agreement and covenant not to sue the Durr Entities under such Claims.


2.4 "Claims" shall refer to all obligations, actions, causes of action, suits, debts, covenants, contracts, controversies, agreements, promises, damages, judgments, and demands whatsoever, of any kind, type or description, whether known or unknown, disputed or undisputed, accrued or unaccrued, liquidated or contingent, foreseen or unforeseen, direct, vicarious or derivative, asserted or unasserted, in law (by virtue of common law, statute, operation of law or otherwise), equity or admiralty.


3. LICENSE


3.1 Upon payment as described in paragraph 3.2 below, the Binks Entities shall have a non-exclusive, fully paid-up, worldwide license under the Durr Patents (including any continuations, reissues and reexaminations thereof) for their remaining life of the Durr Patents. If at the time of payment, SSA and SEI are no longer affiliated with Binks, then only SSA and SEI shall have the non-exclusive, fully paid-up, worldwide licenses under the Durr Patents for their remaining life.


3.2 Within five (5) business days after the closing of the sale of Binks or the closing of any separate sale of SSA and SEI, but in any event (regardless of whether a sale occurs) n ...