EXHIBIT 10.7
[ATMEL LOGO]
LICENSE AND MANUFACTURING AGREEMENT
This License and Manufacturing Agreement (the "Agreement") is entered into
on February 20, 1997 by and between ATMEL CORPORATION, a California corporation
("Atmel") and SONIX TECHNOLOGIES, INC., a Utah corporation ("Sonix").
RECITALS
A. Sonix is in the business of designing, developing and selling certain
products for hearing applications which incorporate integrated circuits;
B. Atmel is in the business of designing, developing, manufacturing and
selling various types of integrated circuits; and
C. Sonix and Atmel desire to enter into this Agreement for the purposes
of setting forth the terms and conditions under which Atmel will be granted
the right to make or have made certain integrated circuits, for sale to Sonix
and other customers of Atmel, and Atmel will provide manufacturing services
to Sonix with respect to certain of Sonix integrated circuits.
AGREEMENT
NOW, THEREFORE, IN CONSIDERATION OF THE FOREGOING AND THE MUTUAL COVENANTS
CONTAINED HEREIN, THE PARTIES AGREE AS FOLLOWS:
SECTION 1
DEFINITIONS
For purposes of this Agreement the following terms shall have the meanings
set forth below:
1.1 Sonix Patents. "Sonix Patents" shall mean all patents, patent
applications, and additions, continuations, continuations-in part, divisions,
reissues or extensions based thereon, if any, in all countries of the world,
which are owned by Sonix now or at any time during the term of this Agreement,
or which are licensed by Sonix from a third party with the right to grant sub
licenses of the scope granted herein, and which are required for the
manufacture, use and sale of Products.
1.2 Effective Date. "Effective Date" shall mean the date first set forth
above.
[ * ]= CERTAIN INFORMATION IN THIS DOCUMENT HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS.
1.3 Licensed Technology. "Licensed Technology" shall mean those
integrated circuits and any Updates which are delivered by Sonix to Atmel,
comprising Sonix's core DSP, audio processing algorithm, low power/low voltage
technology and related circuit techniques and architecture.
1.4 Hearing Applications. "Hearing Applications" shall mean all
applications involving hearing assistance, hearing restoration, hearing
enhancement, hearing protection, hearing simulation or hearing replacement
relating to personal hearing aids or similar types of devices.
1.5 Non-Hearing Applications. "Non-Hearing Applications" shall mean all
applications other than Hearing Applications, including but not limited to
telephone and personal audio entertainment products.
1.6 Sonix Know-How. "Sonix Know-How" shall mean Sonix's processes,
designs, know-how, trade secrets and other information owned by Sonix or
licensed to Sonix from a third party with the right to grant sub-licenses of the
scope granted herein that are necessary or useful to manufacture, use and sell
Products.
1.7 Products. " Product(s)" shall mean one or more integrated circuit
products, developed or manufactured by or for Atmel using all or a portion of
the Licensed Technology, Sonix Patents or Sonix Know-How.
1.8 Net Selling Price. "Net Selling Price" shall mean the invoiced
price, F.O.B. Atmel's factory, to its customer, less any quantity and trade
discounts, independent sales representative or independent distributor
commissions, and/or product returns, and excluding charges for handling,
freight, taxes or duties of any kind, C.O.D. charges, insurance, and the like.
1.9 Updates. "Updates" shall mean any updates, modifications,
corrections, or improvements made after the date hereof to the Licensed
Technology made during the term of the Agreement.
SECTION 2
LICENSES
2.1 License Grant. Sonix hereby grants to Atmel a worldwide, non-
exclusive license, non-sublicensable, under the Licensed Technology, Sonix
Patents and Sonix Know-How, to make, have made, modify, use, market and sell the
Products for Non-Hearing Applications.
(a) The licenses granted to Atmel by Sonix pursuant to Section 2.1
hereof, may be transferred by Atmel to a majority-owned
subsidiary or parent, or pursuant to a merger, reincorporation or
other transfer, but may not be transferred separately except to a
subsidiary of Atmel, provided however that such subsidiary or
parent agrees to be bound by the terms of this Agreement. The
license granted above may not otherwise be transferred except as
set forth in this Section 2.1 (a). Any such transfer shall not
relieve Atmel of its obligations hereunder.
[ * ]= CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
2
2.2 License to Sonix. Atmel hereby grants to Sonix a perpetual,
worldwide, non- exclusive, non-transferable-license, to make, use and sell
products that include minor improvements or enhancements made by Atmel to the
Licensed Technology for use by Sonix solely in Hearing Applications. If Atmel
makes a major or substantial improvement or enhancement to the Licensed
Technology, Atmel and Sonix shall meet to discuss a license to such major
improvements to Sonix for Hearing Applications.
2.3 Intellectual Property Rights. Atmel agrees that Sonix will retain
sole ownership and complete intellectual property rights to the Licensed
Technology, Sonix Patents and Sonix Know- How licensed to Atmel hereunder and to
any enhancements, modifications, improvements, changes or derivative products
thereto made by or for Sonix. Sonix agrees that Atmel will retain sole ownership
and complete intellectual property rights to all masks, test hardware/software
and other tooling generated to the extent that any or all the foregoing are
generated by or for Atmel to manufacture the Products and to any enhancements,
modifications, improvements, changes or derivative products made by Atmel with
respect to the Products.
SECTION 3
OBLIGATIONS OF THE PARTIES
The Parties respectively agree to perform the following tasks with respect
to the Products:
(a) Atmel shall make available to Sonix its design, electrical and layout
rule set for Atmel's AT19760 Process.
(b) Atmel shall make available to Sonix, in a format compatible with
Sonix's design platform, the AT19760 digital cell library; transistor level
Hspice models (level 42 or level 49); 1/0 pad library and gate level and
transfer transistor level representations for the EEPROM.
(c) A preliminary design review will be held at Atmel. Atmel and Sonix
shall review and agree on the scope of the work, (for example, Sonix's product
specification, test specification and test plan) begin the design.
(d) Sonix shall design, simulate, layout, run DRC and LVS on the circuit
and generate a GDSII tape for the complete chip, except for the EEPROM bit-cell.
Sonix will not be given EEPROM bit-cell information.
(e) ATMEL shall integrate the EEPROM bit-cell into the EEPROM, run DRC's
and LVS, and generate mask data.
(f) A final design review will be held at Atmel before masks are made.
(g) Atmel shall generate masks, and start one (1) 24 wafer lot for design
verification (hold-12 @ poly; hold-6 @ contact.) 6 wafers will be completed and
delivered to Sonix. A number of the completed wafers (to be mutually agreed)
will be delivered without passivation. The remainder of the lot will be
completed after evaluation of the initial 6 wafers, possibly with mask changes
as provided for in Exhibit A.
(h) Atmel shall generate a test program (probe) from customer
supplied,test specification and test vectors.
(i) Atmel shall perform qualification (per Sonix's specification) and
characterization for release of the Product to production.
(j) Atmel shall make available to Sonix any applicable future fabrication
process that Atmel installs into its fabrication facility in Colorado
Springs, Colorado.
[ * ] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
3
SECTION 4
ROYALTIES
4.1 Payments. In consideration for the grant of licenses and other
rights by Sonix to Atmel hereunder, Atmel agrees to pay Sonix a royalty in
the amount of five percent (5%) of the Net Selling Price of each Product sold by
Atmel or its transferee under Section 2.1 (a) to p arties other than Sonix.
4.2 Statement and Payment. Within forty-five (45) days after the end of
each calendar quarter, Atmel shall finish to Sonix a statement showing for
each Product the number of each such Product which were sold by Atmel or its
transferee under Section 2.1 (a) during such quarter and the royalty due to
Sonix, which statement shall be accompanied by payment of such royalties in U.S.
Dollars. Late payments shall be subject to a service charge of 1.5% per month or
the maximum rate permitted by applicable law. Atmel shall keep records of
royalty bearing events for two years. Sonix may have an independent third party
audit such records of Atmel upon reasonable notice and no more than once a
year. If the audit reveals an underpayment of royalties of 10% or more, then
Atmel shall pay all costs of the audit in addition to the amount of the
underpayment plus reasonable interest.
SECTION 5
MANUFACTURING
5.1 Manufacturing. Atmel agrees to manufacture and sell Products to Sonix on
the terms and conditions set forth herein. The terms and conditions of this
Agreement shall control all sales of Products by Atmel to Sonix, and any
additional or different terms or conditions in either party's purchase order,
acknowledgment, or similar document shall be of no effect.
5.2 Pricing. Sonix shall pay Atmel for Product and engineering services as
set forth in Exhibit A.
5.3 Payment.
(a) Payment for Products shall be made by Sonix in U.S. Dollars within
thirty (30) days following receipt of Atmel's invoice. In the event Sonix
fails to make any payment here-under when due, Atmel may require, as a
condition to shipping any additional Products to Sonix, prepayment by Sonix for
such shipment or other assurance of payment by Sonix at Atmel's discretion.
Amounts past due will be subject to a monthly charge at the rate of 1.5% per
month or the maximum rate permitted by law, whichever is less, to cover
Atmel's costs of servicing such past due amounts.
(b) Any purchase by Sonix of any product shall be subject to reasonable
review and approval by Atmel's credit department.
(c) Sonix shall pay, in addition to the prices quoted or invoiced, the
amount of any sales, use, excise or other similar tax or duty applicable to the
sale to Sonix of any Products, or Sonix shall supply Atmel with an appropriate
tax exemption certificate.
[ * ]= CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
4
5.4 Forecasts and Orders.
(a) Forecast. Commencing upon Atmel's commercial production of the
Products Sonix shall provide to Atmel a eighteen (18) month rolling forecast
setting forth its estimated requirements for shipment by month for Products, and
Sonix and Atmel agree that the current six (6) months of the rolling forecast
is a firm minimum and may be increased for months beyond the cycle time, which
is currently three (3) months, but may change from time to time. Sonix shall
submit purchase orders for products forecasted to be shipped in such six month
period, but shall in any event be liable for payment and Atmel for shipment
with respect to such products even if Sonix fails to submit such an order to
Atmel provided, however, if Sonix does not place a purchase order, or cancels
a purchase order prior to completion of the Products, Sonix shall only be liable
for costs incurred to the date of cancellation plus Atmel's profit for such
Product. This forecast shall be updated monthly. Such purchase orders may be
changed as mutually agreed to by the parties hereto.
(b) Minimums. Notwithstanding any other provisions of this Agreement,
Sonix agrees to purchase and Atmel agrees to supply a minimum of the following
quantities:
i) * die per month ( * die per year) beginning one year
after production release of the first Product manufactured for Sonix;
ii) * die per month ( * die per year) beginning two years
after production release of the first Product manufactured for Sonix;
iii) * die per month ( * die per year) beginning three years
after production release of the first Product manufactured for Sonix; and
iv) * percent ( * %) of all Product sold by to
parties other than Sonix shall be counted as applying to the minimums set forth
above.
(c) Orders. All Agreement purchases and sales between Atmel and Sonix
shall be initiated by Sonix's issuance of written purchase orders sent via
courier or facsimile. Such orders shall state unit quantities, unit
descriptions, requested delivery dates, and shipping instructions. The
acceptance by Atmel of an order shall be indicated by written acknowledgment
thereof by Atmel. All orders placed by Sonix and accepted by Atmel shall be
non-cancelable except as set forth in Section 5.4 (a). If in conformance with
this Agreement Atmel shall accept the purchase order or if not in conformance
with this Agreement, Atmel shall notify Sonix reasonably promptly to the
extent it does not accept any order placed by Sonix. The terms and conditions of
this Agreement shall prevail over and supersede any conflicting or contravening
terms or condition of any purchase order or acknowledgment for the Product.
5.5 Shipping. All Products delivered pursuant to the terms of this
Agreement shall be suitably packed for shipment in Atmel's standard
containers, marked for shipment at Sonix's address set forth above or specified
in Sonix's purchase order, and delivered to a carrier or forwarding agent chosen
by Sonix. Should Sonix fail to designate a carrier, forwarding agent or type of
conveyance, Atmel shall make such designation in conformance with its standard
shipping practices. Shipment will be F.O.B. Atmel's factory, at which time
risk of loss (other than loss or damage due to Atmel's failure to properly
package the Products) and title shall pass to Sonix, and all freight, insurance
and other shipping expenses, as well as any special packing expenses, shall be
bome by and charged separately to Sonix. Sonix shall have fifteen days to
inspect the Products and reject any Product that does not meet the applicable
specifications.
[ * ]= CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
5
5.6 Warranty.
(a) Atmel warrants that goods delivered hereunder shall conform to the
applicable specifications and shall be free from defects in material and
workmanship under normal use and service for a period of one year from the
applicable date of invoice. For products which are not standard products, such
as dice and wafers, Atmel warrants to Sonix that such products shall conform
to the applicable specifications and shall be free from defects in material and
workmanship under normal use and service for a period of ninety (90) days from
the date code as set forth on Sonix's end Product. Products which are "samples"
and/or "prototypes" are sold "AS IS", "WITH ALL FAULTS," and with no warranty
whatsoever.
If during such warranty period, (i) Atmel is notified promptly in writing upon
discovery of any defects in the goods, including a detailed description of such
defect; (ii) such goods are returned to Atmel, FCA
Atmel's facility accompanied by Atmel's Returned Material Authorization; and
(iii) Atmel's reasonable examination of such goods discloses to Atmel's
satisfaction that such goods are defective and such defects are not caused by
accident, abuse, misuse, neglect, alteration, improper installation, repair, or
alteration by someone other than Atmel, improper testing, or use contrary to
any instructions issued by Atmel within a reasonable time, Atmel shall (at
its sole option) promptly either repair, replace or if not commercially
reasonable for the prior options, credit Sonix the purchase price of such goods.
Prior to any return of goods by Sonix pursuant to this clause, Sonix shall
afford Atmel the opportunity to inspect such goods at Sonix's location, and
any such goods so inspected shall not be returned to Atmel without its prior
written consent.
Atmel shall return any goods repaired or replaced under this warranty to Sonix
transportation prepaid, and reimburse Sonix for the transportation charges paid
by Sonix for such goods. The performance of this warranty shall be tolled during
such repair, replacement and transportation period however the total warranty
period for any goods shall not be beyond that period applicable to the goods
originally delivered.
THE FOREGOING WARRANTY CONSTITUTES ATMEL'S EXCLUSIVE LIABILITY, AND THE
EXCLUSIVE REMEDY OF SONIX, FOR ANY BREACH OF WARRANTY OR OTHER NONCONFORMITY OF
GOODS COVERED BY THIS AGREEMENT. THIS WARRANTY IS EXCLUSIVE, AND IN LIEU OF ALL
OTHER WARRANTIES. ATMEL MAKES NO OTHER WARRANTIES, EXPRESS, IMPLIED, OR
STATUTORY, INCLUDING WITHOUT LIMITATION ANY WARRANTIES OF MERCHANTABILITY AND
FITNESS FOR A PARTICULAR PURPOSE. THE SOLE AND EXCLUSIVE REMEDY FOR ANY BREACH
OF THIS WARRANTY SHALL BE AS EXPRESSLY PROVIDED HEREIN.
SECTION 6
TERM AND TERMINATION
6.1 Term. This Agreement shall become effective upon the Effective Date
and shall remain in force until five (5) years from the Effective Date, and
thereafter shall be automatically extended for additional one (1) year periods,
unless either party gives ninety (90) days written notice prior to the
expiration of the Agreement.
6.2 Termination for Breach. If either party breaches any term or condition
of this Agreement in any material respect and fails to cure that breach within
ninety (90) days after receiving written notice
[ * ]= CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
6
of the breach, the other party shall have the right to terminate this Agreement
by written notice after the end of such ninety (90) day period.
6.3 Bankruptcy. Either party may terminate this Agreement if the other
becomes the subject of a voluntary or involuntary petition in bankruptcy or any
administrative or legal proceeding relating to insolvency, receivership,
liquidation or composition for the benefit of creditors.
6.4 Survival of Provisions. The provisions of Sections 5, 6, 7, 8, 9 and
10 shall survive the termination of this Agreement for any reason. All other
rights and obligations of the parties shall cease upon termination of this
Agreement, except that in the event of the expiration or the termination of this
Agreement by Atmel following a material breach by Sonix, the license granted
to Atmel in Section 2 hereof shall survive and remain in ftill force and
effect, and such license shall thereafter be perpetual, but Atmel shall
continue to pay royalties as set forth in Section 4 provided, however, that
Atmel may offset any amounts owed to Sonix by Atmel against any damage or
costs it occurs because of such breach. In the event of a termination of this
Agreement by Sonix following a material breach by Atmel, the license granted
to Atmel in Section 2 shall terminate upon the sale of the Products Atmel
has on its backlog as of the date of termination of the Agreement, and Atmel
shall pay Sonix royalties for such Products and the licensed granted to Sonix in
Section 2.2 shall survive the termination or expiration of the Agreement.
Atmel shall have no rights to any Updates made to the Licensed Technology
after the expiration of the Agreement.
SECTION 7
INDEMNITY
7.1 Indemnification by Sonix. Sonix represents and warrants that it has
full right and authority to enter into this Agreement and to grant the licenses
granted by it to Atmel herein and that no third party has any rights of any
kind with respect to the Licensed Technology, the Sonix Patents or the Sonix
Know-How that would conflict with such licenses. Except as set forth in Section
7.2 hereof, Sonix further agrees to defend and indemnify Atmel against any
actions brought against Atmel or its customers to the extent based upon a
claim that the Licensed Technology infringes any patent, trade secret or other
intellectual property right of any third party, and to pay any settlements
entered into or damages awarded against Atmel or its customers to the extent
based upon such a claim; provided, that Sonix is provided reasonably prompt
notice of any such action and reasonable assistance in connection with the
defense thereof (at Sonix's expense) and allows Sonix full control of the
defense and settlement thereof. This Section 7 sets forth Atmel's sole remedy
for any infringement claims it may have against Sonix or any breach by Sonix of
the above warranty.
7.2 Indemnification by Atmel. Except as set forth in Section 7.1 hereof,
Atmel agrees to defend and indemnify Sonix against any actions brought against
Sonix or its customers to the extent based upon a claim that a Product or a
process used to manufacture a Product infringes any patent, trade secret or
other intellectual property right of any third party as a result of information
or processes provided to Sonix by Atmel, and agrees to pay any settlements
entered into or damages awarded against Sonix or its customers to the extent
based upon such a claim; provided that Atmel is provided reasonably prompt
notice of any such action and reasonable assistance in connection with the
defense thereof (at Atmel's expense) and allows Atmel full control of the
defense and settlement
[ * ]= CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
7
thereof. This Section 7 sets forth Sonix's sole remedy for any infringement
claims it may have against Atmel.
7.3 Remedies. If a Product is or becomes the subject of any claim demand,
suit or proceeding for any infringement of any third party patent, trade secret
or other intellectual property right, or if it is adjudicatively determined that
such Product infringes any third party patent, trade secret or other
intellectual property right, then indemnifying party shall, at its option and
expense, either (i) procure for indemnified party and its customers the right
under such third party intellectual property to manufacture, sell or use, as
appropriate, the infringing technology; (ii) replace or modify the infringing
technology with other suitable and reasonably equivalent non-infringing
technology; or (iii) if neither of the foregoing is commercially practical
refund any amounts already paid with respect to those particular Products that
may no longer be sold or otherwise distributed. Sonix's total liability under
this Section 7 shall not exceed the amount of cumulative payments of royalties
Sonix has received from Atmel pursuant to this Agreement. Atmel's total
liability under this Section 7 shall not exceed ten percent (10%) of the Net
Selling Price of each such Product found to be infringing.
7.4 Disclaimer. THE FOREGOING STATES BOTH PARTIES ENTIRE LIABILITY AND
OBLIGATION (EXPRESS, IMPLIED, STATUTORY OR OTHERWISE) WITH RESPECT TO
INTELLECTUAL PROPERTY INFRINGEMENT OR CLAIMS THEREFOR REGARDING ANY OF THE
PRODUCTS OR TECHNOLOGY DEVELOPED, MANUFACTURED OR SOLD PURSUANT TO THIS
AGREEMENT.
SECTION 8
CONFIDENTIALITY
8.1 Confidential Information.
(a) As used in this Section 8. 1, the term "Confidential Information"
shall mean any information disclosed by one party to the other pursuant to this
Agreement which is in written, graphic, machine readable or other tangible form
and is marked "Confidential", "Proprietary" or in some other manner to indicate
its confidential nature. Confidential Information may also include oral
information disclosed by one party to the other pursuant to this Agreement,
provided that such information is designated as confidential at the time of
disclosure and reduced to a written summary by the disclosing party, within
thirty (30) days after its oral disclosure, which is marked in a manner to
indicate its confidential nature and delivered to the receiving party. In
addition, all technical and confidential information exchanged prior to the
Effective Date shall be subject to the terms of this Section 8 after the
Effective Date.
(b) Each party shall treat as confidential all Confidential Information of
the other party, shall not use such Confidential Information except as expressly
set forth herein or otherwise authorized in writing, shall implement reasonable
procedures to prohibit the disclosure, unauthorized duplication, misuse or
removal of the other party's Confidential Information and shall not disclose
such Confidential Information to any third party except as may be necessary and
required in connection with the rights and obligations of such party under this
Agreement, and subject to confidentiality obligations in writing at least as
protective as those set forth herein.
[ * ]= CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
8
Without limiting the foregoing, each of the parties shall use at least the same
procedures and degree of care which it uses to prevent the disclosure of its own
confidential information of like importance to prevent the disclosure of
Confidential Information disclosed to it by the other party under this
Agreement, but in no event less than reasonable care.
(c) Notwithstanding the above, neither party shall have liability to the
other with regard to any Confidential Information of the other which:
(i) was generally known and available in the public domain at the time it
was disclosed or becomes generally known and available in the public
domain through no fault of the receiver;
(ii) was known to the receiver at the time of disclosure;
(iii) is disclosed with the prior written approval of the disclosure;
(iv) was independently developed by the receiver without any use of the
Confidential Information;
(v) becomes known to the receiver from a source other than the disclosure
without breach of this Agreement by the receiver and otherwise not in
violation of the disclosure's rights; or
(vi) is disclosed pursuant to the order or requirement of a court,
administrative agency, or other governmental body; provided, that the
receiver shall provide prompt, advanced notice thereof to enable the
disclosure to seek a protective order or otherwise prevent such
disclosure.
(d) Each party shall obtain the execution of proprietary non-disclosure
agreements with its employees, agents and consultants having access to
Confidential Information of the other party, and shall diligently enforce such
agreements, or shall be responsible for the actions of such employees, agents
and consultants in this respect.
8.2 Publicity. All publicity regarding the announcement of this Agreement
shall be coordinated by both parties. Neither party shall disclose the terms of
this Agreement without the prior written approval of the other party, except as
required as a matter of law or to attorneys, accountants or investment bankers,
if necessary for Sonix to operate or raise funds but each such disclosure shall
have executed a non-disclosure agreement similar in content to Section 8 hereof.
8.3 Return of Information. Upon the written request by either party
following the termination of this Agreement, each party shall return to the
other party any Confidential Information of the other party in its possession,
except that Atmel shall be permitted to retain any Confidential Information
relating to Sonix Know-How in the event this Agreement is terminated by Atmel
as a result of a breach by Sonix, but must keep all Confidential Information as
set forth in this Section 8.
[ * ]= CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
9
SECTION 9
LIMITATION OF LIABILITY
EXCEPT IN THE CASE OF AN INTENTIONAL OR GROSSLY NEGLIGENT ACT OR OMISSION OF A
PARTY, NEITHER PARTY SHALL BE LIABLE FOR ANY SPECIAL, CONSEQUENTIAL, INDIRECT,
OR INCIDENTAL DAMAGES, HOWEVER CAUSED, ON ANY THEORY OF LIABILITY AND WHETHER OR
NOT SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, ARISING IN
ANY WAY OUT OF THIS AGREEMENT OR THE DESIGNS, PRODUCTS, INFORMATION OR OTHER
TECHNOLOGY PROVIDED PURSUANT TO THIS AGREEMENT.
SECTION 10
MISCELLANEOUS
10.1 Governing Law. This Agreement shall be governed by and interpreted in
accordance with the laws of the State of California.
10.2 Force Majeure. If the performance of this Agreement or any obligations
hereunder is prevented, restricted or interfered with by reason of fire or other
casualty or accident, strikes or labor disputes, yield problems, war or other
violence, any law, order, proclamation, ordinance, or demand or requirement of
any government agency, the party so affected upon giving prompt notice to the
other party shall be excused from such performance during such prevention,
restriction or interference.
10.3 Assignment. Except as set forth in Section 2, neither party may assign
or delegate this Agreement or any of its licenses, rights or duties under this
Agreement without the prior written consent of the other, except to a person or
entity into which it has merged or which has otherwise succeeded to all or
substantially all of its business and assets, and which has assumed in writing
or by operation of law its obligations under this Agreement.
10.4 Arbitration. Any dispute or claim arising out of or relating to this
Agreement, or the interpretation, making, performance, breach or termination
thereof, shall be finally settled by binding arbitration in Santa ▇▇▇▇▇ County,
California, under the Rules for Commercial Arbitration of the American
Arbitration Association, by three arbitrators (or such lesser number of
arbitrators as the parties hereto shall agree) appointed in accordance with said
Rules. Judgment on the award rendered by the arbitrators may be entered in any
court having jurisdiction thereof. Notwithstanding the foregoing, the parties
may apply to any court of competent jurisdiction for a temporary restraining
order, preliminary injunction, or other interim or conservatory relief, as
necessary, without breach of this arbitration agreement and without any
abridgment of the powers of the arbitrators.
10.5 Notices. All notices and other communications required or permitted
hereunder shall be in writing and shall be mailed by registered or certified
mail, postage prepaid, or otherwise delivered by hand, by messenger or by
telecommunications addressed to the addresses first set forth above or at such
other address furnished with a notice in the manner set forth herein. Such
notices
10
shall be deemed to have been served when delivered or, if delivery is not
accomplished by reason of some fault of the addressee, when tendered.
10.6 Partial Invalidity. If any paragraph, provision, or clause the of
shall be found or be held to be invalid or unenforceable in any jurisdiction in
which this Agreement is being performed, the remainder of this Agreement shall
be valid and enforceable and the parties shall negotiate, in good faith, a
substitute, valid and enforceable provision which most nearly effects the
parties' intent in entering into this Agreement.
10.7 Counterparts. This Agreement may be executed in counterparts which,
taken together, shall be regarded as one and the same instrument.
10.8 Waiver. The failure of either party to enforce at any time the
provisions of this Agreement shall in no way be constituted to be a present or
future waiver of such provisions, nor in any way affect the validity of either
party to enforce each and every such provision thereafter.
10.9 Entire Agreement. The terms and conditions herein contained
constitute the entire agreement and supersede all previous agreements and
understandings, whether oral or written, including without limitation the Non-
Disclosure Agreement previously entered into by the parties, between the parties
hereto with respect to the subject matter hereof and no agreement or
understanding varying or extending the same shall be binding upon either party
hereto unless in a written document signed by the party to be bound thereby.
10.10 Section Headings. The section headings contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed
by duly authorized officers or representatives as of the date first above
written.
ATMEL CORPORATION SONIX TECHNOLOGIES, INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ By: /s/ ▇. ▇▇▇▇▇▇▇▇
----------------------- ----------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Name: ▇. ▇▇▇▇▇▇▇▇
--------------------------
President and CEO Title: President and CEO
-------------------------
[ * ]= CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
11
EXHIBIT A
(Pricing)
Non-recurring Engineering (NRE) Charges
---------------------------------------
New Designs
-----------
1. Design Support EEPROM Cell + Interface Circuits, ESD structures, $[ * ]
final DRC/LVS, Frame, FDR
2. Masks AT19760 process [ * ] masks at [ * ] per layer $[ * ]
3. Test Hardware Design and Build Probe Card and Load Board
-Supply Sonix with two Probe Cards @ $[ * ] each $[ * ]
4. Test Program Sonix to provide digital test vectors and test specs. Jointly debug $[ * ]
5. Wafers Sonix to receive [ * ] wafers with at least [ * ] wafers being without
passivation $[ * ]
------
Total $[ * ]
Design Revisions
----------------
Wafer lots are $[ * ] for [ * ] wafers. Masks are $[ * ] per layer. Engineering
support [ * ]*
Qualifications
--------------
6. Qualification [ * ]*
7. Characterization [ * ]*
Unit Pricing
------------
8. Prototypes are $[ * ] each (Min and Max quantities [ * ]*)
9. Productions Units are $[ * ] each.
Assumptions a) Die Size 100mils x 150mils on AT19760 process;
b) Wafer Sort Test time is 5 seconds; and
c) Deliver tested die (bumping and price adder TBD*).
[ * ]
[ * ]= CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.