Exhibit 10.19
Sonic Innovations, Inc.
5330 South 000 Xxxx
Xxxxx 000
Xxxx Xxxx Xxxx
Xxxx 00000-0000
XXX
(in the following referred to as "Licensee")
and
K/S HIMPP
Ny Vestergaardsvej 25
XX-0000 Xxxxxxxx
Xxxxxxx
(in the following referred to as "Licensor")
have today entered into the following
PATENT LICENSE AGREEMENT
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1. PREAMBLE
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1.1. Licensor is the owner of the entire right, title and interest in certain
patents and patent applications.
1.2. Licensee wishes to obtain a non-exclusive license to the patents and patent
applications as defined below, and Licensor is willing to grant said
license to Licensee on the terms hereinafter set forth.
1.3. This Patent License Agreement shall replace the Patent License Agreement
between the parties dated August 27 and September 10, 1998 with effect as
from June 13, 2000, however, any royalties due from January 1 to June 13,
2000 shall be payable in accordance with the terms of the Patent License
Agreement dated August/September 1998.
2. DEFINITIONS
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2.1. The term "Licensed Patents" as used in this Agreement shall be defined as
all patents and patent applications owned by Licensor as of the effective
date of this Agreement and which Licensor has the right to license
hereunder, including without limitation the patents and patent applications
listed in Exhibits A and B to this Agreement, as well as any patents which
are later issued from patent applications listed in Exhibits A and B.
Licensed Patents shall not include any of the patents or applications owned
by the Licensor as listed in Exhibit C.
2.2. The term "Licensed Products" as used in this Agreement shall mean hearing
aids, components thereof or any apparatus, device or system which is
designed for use with a hearing aid, covered by a claim of a Licensed
Patent or made by a process covered by a claim of a Licensed Patent.
2.3. For purposes of this Agreement the term "affiliated company" shall include
a company or entity which itself is directly or indirectly controlled by or
directly or indirectly controls the Licensee, or any company or entity
which is directly or indirectly controlled by the company or entity
controlling the Licensee. For purposes of this Clause 2.3 the term
"control" shall mean a shareholding or similar ownership of more than 50
percent.
3. THE LICENSE
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3.1. Subject to the terms and conditions hereinafter set forth, and subject to
any prior conflicting rights that may have been granted under the Licensed
Patents, Licensor hereby grants to Licensee a non-exclusive, worldwide
license under the Licensed Patents to make, use, sell, have made and import
Licensed Products.
3.2. Licensee is aware that license agreements identical to this Agreement are
entered into between Licensor and other present and future limited partners
of Licensor, and that license agreements on terms that are not identical to
this Agreement may be entered into between Licensor and third party
licensees granting to such licensees a non-exclusive license to the
Licensed Patents.
3.3. The grant of license hereunder is for the use exclusively by Licensee and
affiliated companies of Licensee, and Licensee shall not grant to third
parties any sub-licenses or other rights under the Licensed Patents.
3.4. The above non-exclusive rights of the parties may be subject to
restrictions or limitations imposed under mandatory provisions of the EU or
under national law or regulations and such provisions shall apply and be
considered part of this Agreement.
4. THE PATENTS
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4.1. During the life of this Agreement Licensor in its sole discretion shall
decide what steps shall be taken to obtain patents that have been applied
for and to maintain the patents already granted. All costs connected with
the maintenance and issuance of patents shall be paid by Licensor.
4.2. Licensee has been informed that Licensor may at its sole discretion
discontinue the maintenance of the Licensed Patents or part thereof, and
Licensee agrees that it shall not have any right of compensation or any
other claim against Licensor based on the fact that the Licensed Patents or
some of them may lapse.
5. ASSIGNMENT/SUB-LICENSES
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5.1. Licensee shall not be entitled to assign its rights and obligations
hereunder to a third party without the express permission of Licensor, such
permission not to be withheld by Licensor in the event that Licensee
wishes to sell all of Licensee's hearing aid activities, and the purchaser
of such activities agrees to assume all of Licensee's rights and
obligations as against Licensor under this Agreement and in Licensee's
capacity as limited partner in the Licensor.
5.2. Licensee shall not be entitled to grant sub-licenses.
6. WARRANTIES OF LICENSOR
----------------------
6.1. Licensor warrants,
that Licensor is the owner of the entire right, title and interest in the
---- Licensed Patents and has the right to grant the license granted
herein; and
that Licensor is not aware of any prior conflicting rights granted under
---- any of the Licensed Patents except: the Central Institute for the
Deaf (CID) has been granted an option for an exclusive license under
all patents listed in Exhibit B for all fields of use except hearing
aids.
6.2. Nothing in this Agreement shall be construed as a representation or
warranty by Licensor as to the technical or commercial results which can be
obtained by the exploitation of the Licensed Patents.
6.3. The parties agree that should a patent not issue from any of the
applications listed in Exhibits A and B hereto, the terms hereof inclusive
of Licensee's obligations hereunder shall be otherwise unaffected by such
occurrence.
7. INFRINGEMENT
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7.1. In the case of any third party infringing the Patents, Licensor shall in
its sole discretion decide whether legal proceedings shall be initiated to
prevent such infringement. If legal proceedings are initiated, Licensee
shall, if requested, act under the instructions of Licensor in this regard
to the extent that such instructions are not contrary to the interest of
Licensee.
7.2. Costs incurred in connection with legal proceedings shall be borne by
Licensor.
8. PRODUCT LIABILITY AND COMPLIANCE
--------------------------------
8.1. Only Licensee shall be liable for any claim for compensation which might be
set forth by any third party as a consequence of the exploitation of the
Licensed Patents.
8.2. Licensee shall observe and comply with all local laws, rules and
regulations in the territory applicable to the exploitation of the Licensed
Patents, and shall at its own cost obtain any necessary governmental permit
or approval.
9. SECRECY
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9.1. The parties hereto acknowledge that each party has an interest in
maintaining the confidentiality of the Invention and the parties' business
and trade practices. Therefore the parties shall treat as secret and
confidential all information relating to the other party's business and
products, and to the Invention (collectively, the "Confidential
Information"). The parties each agree to use their best efforts to prevent
the unauthorised use and disclosure of the Confidential Information, which
shall include requiring all third parties to whom the Confidential
Information is disclosed to execute confidentiality agreements containing
terms similar to those contained in this Article 11.1. Notwithstanding the
foregoing, the parties may disclose any Confidential Information which has
been independently acquired from a third party, that does not have an
obligation of confidentiality to any of the parties, which is made public
incident to the filing of patent applications or the issuance of patents,
which has otherwise become generally known in the industry in which the
parties operate other than as a result of wrongdoing by the party
disclosing such information, or the disclosure is required pursuant to
judicial order or the mandate of any governmental agency or authority.
9.2. The obligations of confidentiality hereunder shall continue after the
expiration of this Agreement, irrespective of the cause and irrespective
of which of the parties might terminate the Agreement.
10. FORCE MAJEURE
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10.1. Neither party shall be under any liability to the other party hereunder
due to circumstances that such party shows is beyond his control, such as
change of legislation, government prohibition, or other kind of force
majeure. The parties undertake to notify the other party if any force
majeure circumstances should occur.
11. LICENSE FEES
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11.1. In consideration of the license granted hereunder, Licensee has under
Article 4 of the Articles of Association of Licensor in Licensee's
capacity as a limited partner of the partnership agreed to pay a
proportional share of the partnership's yearly deficit, however not
exceeding USD 25,000.
11.2. Payment of the above license fees shall be effected in accordance with the
terms of the Articles of Association of the limited partnership - first
time for the calendar year of 2000 and in proportion to such part of the
calendar year this Patent License agreement has been in force.
12. TERM OF AGREEMENT
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12.1. This Agreement shall be deemed to have come into force on June 13, 2000
and shall remain in force and be non-terminable by Licensor until the
expiry of all of the Licensed Patents, however, subject to the timely
payment by Licensee of all amounts due to Licensor under a subscription
agreement entered into simultaneously herewith (in the following referred
to as "the Subscription Agreement").
12.2. Licensee shall be entitled to terminate its obligation to pay license fees
in accordance with Article 11.1 above in accordance with Article 16.3 of
the partnership Articles subject, however, to settlement in full of all
payments under the Subscription Agreement. After the termination date (as
defined therein) any license to use the Licensed Patents shall still
continue in full force and effect but Licensee having thus terminated the
Agreement shall not have any right to use patents acquired by Licensor
after the termination date.
13. BREACH OF AGREEMENT
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13.1. In the event of a material breach by Licensee of any of its material
obligations under this Agreement or under the Subscription Agreement which
is not remedied within thirty (30) days from the date of service by
Licensor of a notice in writing specifying the material breach and
requiring its remedy, Licensor may terminate this Agreement forthwith.
13.2. In the event of a material breach by Licensor of any of its material
obligations under this Agreement which is not remedied within thirty (30)
days from the date of service by Licensee of a notice in writing
specifying the material breach and requiring its remedy, Licensee may
terminate this Agreement forthwith.
14. APPLICABLE LAW AND ARBITRATION
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14.1. Any dispute arising between the parties concerning this Agreement cannot
be brought before the ordinary courts but shall be resolved in accordance
with substantive Danish law by arbitration in Copenhagen.
14.2. The party intending to convene the arbitration tribunal shall notify the
other party by registered letter of such intent providing a short
description of the issues which shall be before the arbitration tribunal.
Each party shall then within four weeks appoint an arbitrator. These
arbitrators shall within two weeks appoint a third arbitrator who shall be
educated as a lawyer. If the arbitrators have not agreed upon the third
arbitrator within two weeks or if a party fails within the time given to
appoint an arbitrator, the relevant arbitrator shall be appointed if a
party shall so direct by the President of the Maritime and Commercial
Court in Copenhagen.
14.3. The arbitration tribunal shall itself decide its rules of procedure and
shall when handing down its ruling, order the distribution of costs
involved in the matter including costs to legal counsel and, if necessary,
accountants.
14.4. To the extent that they have not been varied by the contents of this
Article 14 the provision of the Danish Arbitration Act shall apply. The
arbitration tribunal shall conduct its proceedings in the English
language.
For the Licensee: For the Licensor:
/s/Xxxxxx Xxxxx /s/Xxxxx Xxxxxxxxxx
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Sonic Innovations, Inc. K/S HIMPP
