'Does the patent re-exam extend the life of this patent? '

No. And, once a patent expires no one is required to pay any royalty after the expiration date even if both parties agreed in writing to do so. This ruling came from the Supreme Court.

But it is not all bad news. We can sue any company for infringment from the date we issued a notice to them up to the date of patent expiration. I am not sure but I think I remember that we have three or six years to collect fro infringement for the time the patent was in force.