EXHIBIT 7.2
Erlangen, November 2, 1999
MARKETING and DISTRIBUTION AGREEMENT
between
SYMPHONIX Devices, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇.▇▇▇▇, ▇▇▇
(hereinafter referred to as "SYMPHONIX")
and
SIEMENS Audiologische ▇▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇. ▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
(hereinafter referred to as "SIEMENS")
Collectively referred to as "The Parties"
WHEREAS SIEMENS is a designer, manufacturer and distributor of hearing
instruments and components for hearing instruments, including integrated
circuits and hybrids for hearing instruments; and
WHEREAS SYMPHONIX is a designer, manufacturer and distributor of
semi-implantable and totally implantable middle ear hearing devices; and
WHEREAS SIEMENS and SYMPHONIX believe that it will be in both of their best
interests to establish a long-term cooperative relationship in connection with
the global positioning of SIEMENS PRODUCTS and SYMPHONIX PRODUCTS as providing a
single continuum of hearing care for the hearing impaired; and
WHEREAS SIEMENS and SYMPHONIX believe that it will be in both of their best
interests to establish, based on this global positioning, certain joint
marketing programs in certain markets and formal distribution agreements for
SYMPHONIX PRODUCTS in certain markets.
DEFINITIONS
"SYMPHONIX PRODUCTS" are defined as all current and future semi-implantable and
totally implantable middle ear devices designed and / or manufactured by
SYMPHONIX. The current SYMPHONIX PRODUCTS are listed in Annex 1. Future
SYMPHONIX PRODUCTS will be included as soon as practical after they become
available.
"SIEMENS PRODUCTS" are defined as all current and future hearing instruments
designed and / or manufactured by SIEMENS.
"TERRITORY" is defined as the countries listed in Annex 2.
1.
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Global Marketing Alliance
SIEMENS and SYMPHONIX shall use their best efforts to jointly promote SIEMENS
PRODUCTS and SYMPHONIX PRODUCTS in the global market. SYMPHONIX PRODUCTS shall
be positioned as superior, technologically advanced hearing care solutions that
address unmet needs of hearing impaired people who are dissatisfied with hearing
instruments and therefor are candidates for semi-implantable or totally
implantable hearing devices. SIEMENS PRODUCTS shall be positioned as superior,
technologically advanced hearing instruments. Together, SIEMENS PRODUCTS and
SYMPHONIX PRODUCTS will be positioned as providing a single continuum of care
for the hearing impaired. This joint positioning by SIEMENS and SYMPHONIX will
be exclusive, as to hearing instruments and semi-implantable and totally
implantable hearing devices.
2. Marketing Cooperation
The Parties agree that they will conduct cooperative marketing programs such as
the following:
(i) joint multimedia programs, including educational programs and workshops
aimed at increasing awareness of hearing health care and the benefits of
the SYMPHONIX PRODUCTS among dissatisfied hearing instrument users,
audiologists and hearing instrument dispensers;
(ii) joint attendance at workshops and scientific conferences and sponsorship
of satellite meetings;
(iii) joint attendance at medical / audiological conferences;
(iv) joint sponsorship of educational forums aimed at hearing impaired
individuals;
(v) joint market research studies;
(vi) joint creation of patient
support groups; and
(vii) joint development of a patient data base that produces
cross-referral of patients.
The Parties agree that they will develop specific programs designed to actively
involve hearing instrument dispensers in the promotion of the SYMPHONIX
PRODUCTS. Such programs will be designed to provide incentives to achieve
referral of potential patients to clinical implanting sites. Such programs may
include sale by the hearing instrument dispenser of the external audio processor
(external part of the semi-implantable hearing device), as well as referral fees
and fitting fees.
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The Parties intend that these programs will be initiated in the TERRITORY, i. e.
during Q 4 of calendar 1999 in France, during Q 1 of calendar 2000 in Spain,
Germany and UK, and as soon as practical in the other countries of the
TERRITORY. The Parties intend that such programs will be fully implemented in
the United States of America and Canada immediately after initiation of
commercial sales. In all other countries such programs will be implemented if
reasonably possible to do so. Any claims regarding The Parties' respective
products shall be subject to approval by SYMPHONIX for SYMPHONIX PRODUCTS and by
SIEMENS for SIEMENS PRODUCTS.
3. Distribution
SIEMENS is hereby appointed to be the exclusive distributor of SYMPHONIX
PRODUCTS in the TERRITORY, subject to the provisions of Section 4.
The Parties will continually monitor the potential distribution of SYMPHONIX
PRODUCTS in countries not currently included in the TERRITORY. However, it is
expressly agreed that the TERRITORY and the provisions of this paragraph, do not
and will not in the future, include the United States of America and Canada. As
existing SYMPHONIX distribution contracts with third party distributors expire,
or SIEMENS foresees marketing potential for SYMPHONIX PRODUCTS or SYMPHONIX
prepares for distribution of SYMPHONIX PRODUCTS in additional countries,
SYMPHONIX and SIEMENS shall negotiate in good faith the addition of such
countries to the TERRITORY.
The distribution rights include but are not limited to the direct sale to local
distributors, hospitals, ENT doctors, dispensers, health insurance companies and
end users.
4. Existing SYMPHONIX Distribution Agreements with third Parties;
SIEMENS Distributors
The designation of certain countries in Annex 2 as part of the TERRITORY, is
contingent on appropriate termination by SYMPHONIX of existing distribution
agreements. The Parties will cooperate in these cases, subject to the following
paragraph, to ensure as smooth as possible a transition from the existing
distribution agreement to SIEMENS or to a new distribution agreement with the
appropriate third party SIEMENS distributor. The countries covered by this
paragraph are Italy, Spain, Portugal, Denmark and Sweden.
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In all cases, where SIEMENS wants to appoint third party distributors in the
TERRITORY for purposes of this AGREEMENT, such appointment is contingent on
SYMPHONIX's explicit prior written approval which shall only be withheld if the
third party distributor distributes products which are directly in competition
to SYMPHONIX PRODUCTS, or if the third party distributor is unable to adequately
market the SYMPHONIX PRODUCTS.
SIEMENS shall ensure that distribution rights granted to its third party
distributors are consistent with the provisions of this Agreement, and do not
exceed the rights granted hereunder to SIEMENS.
5. Scope and Limitation of SIEMENS' Distribution Authority
SIEMENS and SYMPHONIX shall use their reasonable efforts to develop a
comprehensive business plan for distribution of SYMPHONIX PRODUCTS in the
TERRITORY within a period of sixty (60) days after the effective date of this
AGREEMENT. Such business plan will address specific programs and resource
allocations on a country-by-country basis, and will be updated regularly at
least on a yearly basis.
5.1 Introduction Period
The Parties have agreed on principles for such business plan for the
period of the first two (2) years after the effective date as provided in
section 14 ("Introduction Period") as follows:
SIEMENS shall perform in its own name and for its own account all
warehousing, shipping, returns handling, order processing, and invoicing
for SYMPHONIX PRODUCTS;
SYMPHONIX shall provide SIEMENS with adequate quantities of SYMPHONIX
PRODUCTS on a consignment basis and SIEMENS will issue purchase orders
weekly for such SYMPHONIX PRODUCTS, when sold to third party customers
(including third party distributors);
SYMPHONIX shall pay to SIEMENS an amount equal to 5% of the amount
invoiced by SIEMENS (excluding taxes, freight and similar items) to third
party customers and distributors as a handling fee. Such handling fee
will be offset with the purchase price for the corresponding purchase of
SYMPHONIX PRODUCTS by SIEMENS;
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SIEMENS shall purchase SYMPHONIX PRODUCTS from SYMPHONIX at prices equal
to SYMPHONIX's list prices, unless SYMPHONIX has explicitly agreed to a
different price for specific transactions;
SIEMENS shall pay all applicable taxes (such as VAT), freight, duty and
similar items due in the TERRITORY and may invoice these as appropriate
to third party distributors and customers;
SIEMENS shall pay all invoices for SYMPHONIX PRODUCTS within thirty (30)
days of the invoice date (net of the 5% handling fee described above);
SYMPHONIX shall retain title to SYMPHONIX PRODUCTS until shipped by
SIEMENS to third party distributors or customers;
SIEMENS will keep accurate records of the consignment inventory
(including by serial numbers), and will make such records available to
SYMPHONIX upon request, including by submission of periodic detailed
inventory reports;
SIEMENS will keep such records, maintain the inventory and process
transactions in such a way as to be in compliance with the applicable
E.U. directives for active implantable medical devices and U.S.
regulations for Class III medical devices;
SIEMENS and SYMPHONIX will agree on a yearly budget with detailed
assignment of cost to be borne by each of the Parties;
SYMPHONIX will be responsible for promotion as well as for clinical and
technical support with surgeons and hospitals, and will bear the cost for
its support personnel in the TERRITORY;
SIEMENS will be responsible for promotion with hearing aid dispensers and
will bear the cost of its hearing instruments sales and support personnel
in the TERRITORY;
SYMPHONIX will render the technical and clinical support to SIEMENS
subsidiaries, third party distributors or any other party interested in
SYMPHONIX PRODUCTS.
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5.2 Subsequent Period
Commencing two (2) years from the effective date provided in section 14,
("Subsequent Period") SIEMENS will assume the distribution responsibility
for the SYMPHONIX PRODUCTS under the following principles:
SYMPHONIX PRODUCTS will be purchased by SIEMENS at prices providing
SIEMENS with a discount from SYMPHONIX's price list. Such discount will
be at least 50%. The Parties agree that a discount above 50% for SIEMENS
is possible. However, the purchase price to SIEMENS for SYMPHONIX
PRODUCTS should allow SYMPHONIX at least a 20% manufacturing margin,
fully loaded manufacturing cost considered. The Parties agree that a
manufacturing margin of greater than 20% for SYMPHONIX is possible. The
SIEMENS purchase prices for SYMPHONIX PRODUCTS shall be reviewed on an
annual basis by the Parties;
SIEMENS shall be fully responsible for developing the market in the
TERRITORY, for promoting and selling SYMPHONIX PRODUCTS in the TERRITORY
and for determining its sales prices for SYMPHONIX PRODUCTS. SIEMENS
shall maintain the organization and commit to resources to ensure optimum
sales for SYMPHONIX PRODUCTS under the mutually revised business plan;
From the beginning of the Subsequent Period, i.e. after two (2) years
from the effective date provided in section 14, SIEMENS will assume the
direct sales and support organization of SYMPHONIX with such personnel
becoming employees of SIEMENS, providing that the Parties will have
consulted and mutually agreed upon any increases in staffing levels
during the Introduction Period;
SIEMENS will keep adequate records, maintain the inventory and process
transactions in such a way as to be in compliance with the applicable
E.U. directives for active implantable medical devices and U.S.
regulations for Class III medical devices;
Payment terms will be the same as during the Introduction Period, but
title and risk of loss will pass at the time of shipment by SYMPHONIX,
such shipments being FOB San ▇▇▇▇ (INCOTERMS 1990).
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5.3 Regulatory Compliance
During both, the Introduction Period and the Subsequent Period, SIEMENS
shall assist SYMPHONIX as follows in complying with regulatory
requirements.
SIEMENS shall refer any complaints regarding SYMPHONIX PRODUCTS to
SYMPHONIX within two (2) working days after they had become known by
SIEMENS, and if a complaint requires follow up actions to be taken,
SIEMENS will provide all required information available at SIEMENS to
SYMPHONIX within one (1) working day.
Pursuant to the United States Federal Drug Administration's ("FDA")
Medical Device Reporting Regulations and E. U. vigilance reporting
requirements, SYMPHONIX may be required to report to the FDA and European
regulatory agencies information that reasonably suggests that a SYMPHONIX
PRODUCT may have caused or contributed to the death or serious injury or
has malfunctioned and that the device would be likely to cause or
contribute to a death or serious injury if the malfunction were to recur.
SIEMENS agrees to supply to SYMPHONIX any such information available at
SIEMENS within forty-eight (48) hours after becoming aware of such
information so that each can comply with governmental reporting
requirements. In the event that a SYMPHONIX PRODUCT is recalled, SIEMENS
shall cooperate with and assist SYMPHONIX in locating, and retrieving if
necessary, recalled SYMPHONIX PRODUCTS from SIEMENS' customers.
SIEMENS shall maintain a system of traceability of the SYMPHONIX PRODUCTS
including the following consignee information in respect of each
SYMPHONIX PRODUCT sold: (1) SYMPHONIX part number, (2) date of receipt of
SYMPHONIX PRODUCT from SYMPHONIX, (3) serial numbers / expiration date,
(4) invoice number under which the unit was shipped to SIEMENS` customer,
(5) date of shipment of unit from SIEMENS` warehouse, (6) name and
address of SIEMENS' consignee (this shall at a minimum be to the level of
the hospital or clinic).
SIEMENS shall use its best efforts to encourage customers to complete and
submit the registration cards included with each SYMPHONIX PRODUCT.
SIEMENS shall allow SYMPHONIX access to audit inventory processing for
conformance to the requirements of EN ISO 9001.
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6. Commercial Transactions
Commercial transactions concerning SYMPHONIX PRODUCTS shall be performed by
SIEMENS in its own name and on its own account. However, product liability shall
be borne by SYMPHONIX as per Section 11 of this AGREEMENT.
7. Future Product Development
The Parties enter into this AGREEMENT to establish a long term relationship.
SYMPHONIX shall therefore include SIEMENS and SIEMENS shall include SYMPHONIX as
a participant in its process for the definition and specification of future
products. SYMPHONIX shall make all future SYMPHONIX PRODUCTS available to
SIEMENS for the distribution in the TERRITORY, and such SYMPHONIX PRODUCTS shall
be marketed by SIEMENS as soon as practical after they become available.
8. Products
From time to time Annex 1 shall be modified by adding newly developed SYMPHONIX
PRODUCTS and by deleting obsolete and discontinued SYMPHONIX PRODUCTS. However,
any SYMPHONIX PRODUCT discontinuation will be announced with six (6) months
written notice to SIEMENS. SYMPHONIX will make available to SIEMENS for a period
of at least seven (7) years accessories, spare parts and replacement SYMPHONIX
PRODUCTS of any SYMPHONIX PRODUCT after the effective date of its
discontinuation.
9. Confidentiality
SIEMENS shall not use for its own benefit (except as authorized in this
AGREEMENT) nor make available nor disclose to third parties any technical or
marketing information (e.g., drawings or specifications) or information of a
confidential nature which it may acquire in the course of its cooperation with
SYMPHONIX, and shall also prevent the aforementioned information from being
disclosed to or used by unauthorized parties. SYMPHONIX shall assume the same
obligation with regard to information received from SIEMENS. The above mentioned
obligation does not apply to information which is or will become part of the
public domain or which has been publicly disclosed by the other Party without
breach of a confidentiality obligation. The terms of this provision shall
survive the termination of this AGREEMENT for five (5) years.
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10. Default and Extraordinary Termination
In addition to any other termination rights hereunder, each Party shall have the
right to terminate this AGREEMENT and to pursue all remedies available to such
Party, upon the occurrence of any of the following:
(i) a material breach by the other Party of any of any material term or
condition or representation or warranty contained in this AGREEMENT which
such Party fails to cure within thirty (30) days after written notice
thereof;
(ii) the other Party's insolvency, admission of inability to pay its debts as
they become due, filing of a petition for bankruptcy relief or assignment
for the benefit of creditors.
11. Liability
11.1. Indemnification for Infringement of Intellectual Property
SYMPHONIX will defend, at its expense, any action brought against SIEMENS
or SIEMENS' subsidiaries, affiliates, agents, employees or customers to
the extent that it is based on a claim that a SYMPHONIX PRODUCT, when
used in accordance with this Agreement, infringes a patent, trademark or
copyright in the TERRITORY. SYMPHONIX will pay any costs, settlements and
damages finally awarded provided that SIEMENS or SIEMENS' subsidiaries,
affiliates, agents, employees or customers
(i) promptly notifies SYMPHONIX in writing of any claim,
(ii) gives SYMPHONIX sole control of the defense and settlement, and
(iii) provides all reasonable assistance in connection therewith.
SYMPHONIX agrees to keep SIEMENS or SIEMENS' subsidiaries,
affiliates, agents, employees or customers advised of the status of
any claim.
If any SYMPHONIX PRODUCT is finally adjudged to so infringe, or in
SYMPHONIX's opinion such a claim is likely to succeed, SYMPHONIX will, at
its option
(i) procure for SIEMENS the right to continue using the SYMPHONIX
PRODUCT,
(ii) modify or replace the SYMPHONIX PRODUCT so there are no
infringements, or
(iii) refund the price paid including handling charges for logistics
upon return of the SYMPHONIX PRODUCT.
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The foregoing states the entire liability of SYMPHONIX and the exclusive
remedy for SIEMENS or SIEMENS' subsidiaries, affiliates, agents,
employees or customers relating to infringement or claims of infringement
of any patent, trademark, copyright, mask work right, trade secret or
other proprietary right by the SYMPHONIX PRODUCT.
11.2. Product Liability Indemnification
SYMPHONIX agrees to defend against and indemnify and hold SIEMENS or
SIEMENS' subsidiaries, affiliates, agents, employees or customers
harmless from product liability claims, losses, damages or expenses
(including costs of defending any proceedings) resulting from the
purchase, sale, storage, transportation or foreseeable use of SYMPHONIX
PRODUCTS, whether brought under theories of express or implied warranty,
negligence or strict liability. This indemnification will not apply to
any SYMPHONIX PRODUCT which, as determined by arbitration or a competent
courts decision, has been
(i) modified without SYMPHONIX's written authorization,
(ii) not used or maintained in compliance with SYMPHONIX's instructions,
(iii) subjected to misuse, improper maintenance, unusual stress or
accident, or
(iv) used or sold after the "Use Before" date specified by SYMPHONIX.
11.3. Conditions to Indemnification Obligations
The indemnification obligations are subject to the following conditions:
(i) the indemnified party gives prompt notice to SYMPHONIX of the
potential liability or claim;
(ii) the indemnified party promptly grants to SYMPHONIX control over its
defence and settlement; and
(iii) the indemnified party, at the indemnifying party's expense,
provides reasonable and timely assistance in defence of the claim.
The indemnified party may, at its option and expense, participate
in the defence and settlement of any claim or liability under this
AGREEMENT; however, if the indemnified party agrees to a settlement
of such claim or liability without the written consent of
SYMPHONIX, SYMPHONIX shall have no obligation to indemnify the
indemnified party in connection with such settlement.
11.4. Product Liability Insurance
SYMPHONIX shall, for the lifetime of the SYMPHONIX PRODUCTS, secure and
maintain a product liability insurance policy providing coverage for
product liability exposure (including negligence and strict liability) to
third parties resulting from defective SYMPHONIX PRODUCTS (such as
design-, manufacture-, instruction defects) supplied by SYMPHONIX to
SIEMENS in the TERRITORY, provided such coverage is available on
commercially reasonable terms. At SIEMENS' request, SYMPHONIX shall
provide SIEMENS a copy of the insurance policy. The Parties shall, during
the term of this agreement, discuss annually the level of insurance
coverage maintained by SYMPHONIX.
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11.5. General Indemnity
Unless otherwise provided for this Agreement, either Party will indemnify
and hold the other Party harmless from and against any and all losses,
damages, claims, liabilities, cost and expenses (including reasonable
attorneys` fees) directly resulting from
(i) any gross negligent or intentional breach of this Agreement or any
duty or obligations hereunder, or
(ii) any claims that may be made by reason of any gross negligent
or intentional act or omission of a Party or any of its
subsidiaries, affiliates, agents or employees.
12. WARRANTIES
12.1 SYMPHONIX warrants to SIEMENS that the SYMPHONIX PRODUCTS will on the
date of shipment be free from defects in materials and workmanship, and
will under normal use, starting with the date of implantation, conform in
material respects to the then-current user documentation for a period of
three (3) years for the implanted portion of such SYMPHONIX PRODUCT and
for a period of one (1) year for its external portion, but at least for
the mandatory period under the regulations of the E. U.. This limited
warranty will not apply to any SYMPHONIX PRODUCT which as proved by
SYMPHONIX, has been
(i) modified without SYMPHONIX's written authorization,
(ii) not used or maintained in compliance with SYMPHONIX's instructions,
(iii) subjected to misuse, improper maintenance, unusual stress or
accident, or
(iv) used or sold after the "Use Before" date specified by SYMPHONIX.
This limited warranty extends only to SIEMENS and not to any end user or
customer of SIEMENS. The provisions of this Section 12.1 shall not affect
the statutory rights of any end-user in the TERRITORY.
12.2. SIEMENS shall use its best efforts to ensure with its customers that
procedures for ordering of SYMPHONIX PRODUCT and shipment of stock
precludes having expired SYMPHONIX PRODUCT in stock. Expired SYMPHONIX
PRODUCT must not be sold and is not returnable except for
re-sterilization, at the cost, including freight, of SIEMENS. SYMPHONIX
may by notice in writing require SIEMENS to return any expired SYMPHONIX
PRODUCT to SYMPHONIX for re-sterilization which shall be performed at the
cost including freight of SIEMENS.
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12.3 SYMPHONIX shall pass on to SIEMENS good title, free and clear of all
liens and/or encumbrances to SYMPHONIX PRODUCTS delivered as replacement
for non-conforming SYMPHONIX PRODUCTS.
12.4 If SYMPHONIX is unable, within sixty (60) business days of SYMPHONIX'
receipt of defective SYMPHONIX PRODUCTS, to repair or replace
non-conforming SYMPHONIX PRODUCTS, SIEMENS shall be credited the original
purchase price for such SYMPHONIX PRODUCTS. In case of a warranty defect,
which requires a removal from the patients body of defective SYMPHONIX
PRODUCTS as well as a re-implant of repaired/replaced SYMPHONIX PRODUCTS
all direct cost for such surgery, to be paid by SIEMENS shall be borne by
SYMPHONIX, provided SYMPHONIX has approved in advance of the need for
such removal and re-implant.
12.5 SIEMENS shall make no representations to third parties regarding the
performance or functional capabilities or characteristics of the
SYMPHONIX PRODUCTS beyond those stated in SYMPHONIX's then-current
printed Product Specification.
13. Assignment
Neither Party may assign or otherwise transfer this AGREEMENT, or assign any of
its rights or delegate any of its obligations hereunder, without the prior
written consent of the other Party, and any attempted or purported assignment by
either Party without such consent shall be null and void. Notwithstanding the
foregoing, either Party may assign all of its rights and delegate all of its
obligations hereunder in connection with the sale of all or substantially all of
its assets or the reorganization of the assignor, without the prior written
consent of the other Party; provided, however, that any such assignee must
assume all obligations of the assignor under this AGREEMENT to the reasonable
satisfaction of the non-assigning Party.
14. Duration of AGREEMENT, Ordinary Termination
This AGREEMENT shall become effective upon signature by both Parties of both
this Agreement and the Common Stock Purchase Agreement between the Parties, and
shall remain in force for a period of five (5) years. Notwithstanding the
foregoing, this AGREEMENT shall not terminate before September 30, 2004, except
as provided in Section 10 and 15.
Unless either Party has given twelve (12) months written notice of intent to not
renew this AGREEMENT, this AGREEMENT shall automatically renew for successive
one (1) year periods beyond September 30, 2004. After this date, this AGREEMENT
will be cancelable by either Party upon twelve (12) month written notice to the
other Party.
If SYMPHONIX decides not to renew the Agreement a fee will be payable by
SYMPHONIX to SIEMENS, such fee is one times the SIEMENS' prior twelve months
revenues with SYMPHONIX PRODUCTS in the TERRITORY.
Such fee will be payable 60 days after the effective date of the termination of
this AGREEMENT.
15. SYMPHONIX Change of Control
In the event of a Change in Control of SYMPHONIX (as defined herein), SYMPHONIX
shall have the right to terminate, with three (3) months written notice, this
AGREEMENT by paying SIEMENS the greater of (i) US$ 1,000,000 or 2 times SIEMENS'
prior twelve months revenues with SYMPHONIX PRODUCTS in the TERRITORY if this
AGREEMENT is terminated during the first or second year of the initial term of
this AGREEMENT, (ii) US$ 1,000,000 or 1.5 times SIEMENS' prior twelve months
revenues with SYMPHONIX PRODUCTS in the TERRITORY if this AGREEMENT is
terminated during the third year of the initial term or (iii) US$ 2,000,000 or 1
times SIEMENS' prior twelve months revenues with SYMPHONIX PRODUCTS in the
TERRITORY if this AGREEMENT is terminated during the fourth or fifth year of the
initial term. Upon a termination of this AGREEMENT for such reason SYMPHONIX
will have no further obligations to SIEMENS, and no additional payments will be
due as a result of such termination other than as set out in this paragraph.
Such fee will be payable 60 days after the effective date of the termination of
this AGREEMENT.
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A "Change in Control of SYMPHONIX " shall mean
(i) a merger, consolidation or other business combination or transaction to
which SYMPHONIX is a party if the stockholders of SYMPHONIX immediately
prior to the effective date of the merger, consolidation or other
business combination or transaction as a result of such share ownership
own less than 50 % of the voting power of the surviving corporation
following such merger, consolidation, or other business combination or
transaction,
(ii) an acquisition by any person of voting stock of SYMPHONIX representing
20 % or more of the total current voting power of SYMPHONIX,
(iii) a sale of all or substantially all the assets of SYMPHONIX or (iv) a
liquidation or dissolution of SYMPHONIX.
If the change in control results in an acquisition of SYMPHONIX by a
manufacturer of acoustic hearing aids, then this AGREEMENT may be cancelled by
SIEMENS at SIEMENS' option. Payments will be as set out above.
16. Arbitration
The Parties shall make a good faith effort to settle amicably any dispute or
difference arising out of or resulting from this AGREEMENT or ancillary
agreements regarding its performance. An attempt to arrive at a settlement shall
be deemed to have failed as soon as one of the Parties to this AGREEMENT so
notifies the other Party in writing.
If an attempt at settlement has failed, the dispute shall be resolved definitely
and exclusively by arbitration under the rules of arbitration of the
International Chamber of Commerce in Paris ("Rules") by three (3) arbitrators
appointed in accordance with the Rules.
The place of arbitration shall be Zurich, Switzerland. The procedural law of
that place shall apply where the Rules are silent. It is agreed that all
documentary submissions, presentations, and proceedings shall be in the English
language.
The arbitral award shall be substantiated in writing. The decision of the
arbitral tribunal shall be final and binding on the Parties, and judgement upon
the arbitral award may be entered in any court having jurisdiction thereof. The
arbitral tribunal shall assign the costs of arbitration.
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17. Applicable Law
The contractual relations between the Parties shall be governed by the
provisions of this AGREEMENT and all other agreements regarding its performance,
and otherwise in accordance with the substantive law in force in Switzerland.
The application of the United Nations Convention on contracts for the
International Sale of Goods of April 11, 1980, shall be excluded.
18. Miscellaneous
18.1. Supplemental agreements and amendments to this AGREEMENT must be made in
writing.
18.2. Neither Party may assign its rights or obligations under this AGREEMENT
without the prior written consent of the other Party, except to a
successor of all or substantially all of its business and/or properties.
IN WITNESS WHEREOF, the Parties have caused this AGREEMENT to be executed by
their duly authorized representatives on the dates as set forth below.
SYMPHONIX Devices, Inc. SIEMENS Audiologische Technik GmbH
Date: November 2, 1999 Date: November 2, 1999
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
------------------------------ ------------------------------
President & Chief Executive Officer Managing Director
Annex 1: Current SYMPHONIX PRODUCTS
Annex 2: Territory
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ANNEX 1 - Current SYMPHONIX PRODUCTS
Vibrant P Soundbridge
Vibrant D Soundbridge
Related Programmers and Accessory Kits
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ANNEX 2 - TERRITORY
1. The countries currently comprising the European Union:
Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland,
Italy, Luxembourg, Netherlands, Portugal, Spain, Sweden, United Kingdom.
2. Additional countries in Western Europe:
Iceland, ▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇.
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