Exhibit 10.25


JOINT DEVELOPMENT ADDENDUM TO STRATEGIC

ALLIANCE AGREEMENT


          IntriCon
Corporation, a Pennsylvania Corporation having a place of business at 1260 Red
Fox Road, Arden Hills, Minnesota 55112 USA (“IntriCon”) and Dynamic Hearing Pty
Ltd, a Corporation organized under the laws of Victoria, Australia and having a
place of business at 2 Chapel Street, Richmond, Victoria 3121, Australia
(“Dynamic Hearing”) hereby agree as follows:


RECITALS


	
  

 	
  

 
	
 A.

 	
 IntriCon manufactures and/or supplies products including digital
 signal processors (“DSPs”); and

 
	
  

 	
  

 
	
 B.

 	
 Dynamic Hearing has expertise in developing technology useful in DSPs
 and DSP devices;

 
	
  

 	
  

 
	
 C.

 	
 The Parties have entered into a Strategic Alliance Agreement having a
 Commencement Date of October 1, 2008 (“Strategic Alliance Agreement”);

 
	
  

 	
  

 
	
 D.

 	
 Under the Strategic Alliance Agreement, IntriCon has made payment
 through December 31, 2010 of the “Second Component” totaling US$600,000, of
 which, under section 4.4 of the Strategic Alliance Agreement, IntriCon is
 currently entitled to carry forward US$256,544 as a remaining credit to be
 offset against future quarters per unit royalties and fees for services;

 
	
  

 	
  

 
	
 E.

 	
 Having indicated that certain changes to the Strategic Alliance
 Agreement were needed, IntriCon made a good faith payment on October 1, 2010
 of US$175,000, which is to be treated consistent with those payments in Year
 2 under the Strategic Alliance Agreement;

 
	
  

 	
  

 
	
 F.

 	
 The Parties are considering further extending their business
 relationship, including IntriCon’s disclosure of certain IntriCon Proprietary
 Development Information, for the purpose of IntriCon’s purchase and directing
 of joint development of certain DSP improvement projects (“Joint Development
 DSP Improvement Project”), which IntriCon desires Dynamic Hearing to treat as
 confidential and use only for purposes of providing DSP improvements to
 IntriCon; 

 
	
  

 	
  

 
	
 G.

 	
 In the event
 that Dynamic Hearing enters into any form of insolvency or administration as
 defined in section 11.4(a) of the Strategic Alliance Agreement and is no
 longer able to support IntriCon products, Dynamic Hearing agrees to make
 available to IntriCon the source code necessary for such support of existing
 products.

 









TERMS OF AGREEMENT


          For
good, valuable and sufficient consideration, IntriCon and Dynamic Hearing agree
as follows:


1. IntriCon Proprietary Development
Information. As used in this Agreement, “IntriCon
Proprietary Development Information” shall mean the existence of this Addendum
Agreement and all technology, designs, analysis, know-how, software and
firmware, product information, marketing and business plans data, employee
information, product information, customer and vendor information, or other
information containing or reflecting IntriCon’s current, future or potential
products or services, together with any information or ideas derived therefrom.
IntriCon’s Proprietary Development Information may exist in any form or medium
and may be communicated in writing, orally, or otherwise. IntriCon Proprietary
Development Information excludes information that Dynamic Hearing can
establish: (a) was already in the possession of Dynamic Hearing prior to the
time of disclosure to Dynamic Hearing and can be so proven with documentary
evidence; (b) is independently derived by the Dynamic Hearing without use of
the IntriCon Proprietary Development Information and outside of any Joint
Development DSP Improvement Projects under this Addendum Agreement, and can be
so proven with documentary evidence; (c) was obtained by Dynamic Hearing from a
third person which is not subject to any legal, contractual, or fiduciary
prohibition or obligation against disclosure; or (d) is or becomes generally
available to the public through no fault of Dynamic Hearing or any of its
agents, advisors, attorneys, affiliates, employees, officers, or directors. 


2. Joint Development DSP Improvement
Projects. From time to time the Parties agree that
they will work on Joint Development DSP Improvement Projects. Joint Development
DSP Improvement Projects must be defined as such in writing and signed off by
both Parties. The Parties agree that IntriCon can disclose IntriCon Proprietary
Development Information for the purpose of proposing to Dynamic Hearing or
negotiating a Joint Development DSP Improvement Project. Joint Development DSP
Improvement Projects may be any projects in which IntriCon proposes a payment
from IntriCon to Dynamic Hearing for work performed by Dynamic Hearing
(including those projects paid for as part of the “Second Component” set forth below
in section 7) for the improvement of any IntriCon current, future or potential
product(s) or service(s). In negotiating a Joint Development DSP Improvement
Project, the Parties will attempt to negotiate and agree upon in writing:


	
  

 	
  

 	
  

 
	
  

 	
 a.

 	
 a set of one or more deliverables for the Joint Development DSP
 Improvement Project;

 
	
  

 	
 b.

 	
 a project schedule for delivering the deliverable(s); and

 
	
  

 	
 c.

 	
 a payment schedule for any and all further payments made by IntriCon
 to Dynamic Hearing for the Joint Development DSP Improvement Project beyond
 those set forth in section 7 below. 

 









3. Patent
Assignment, License. The Parties agree that any original or possibly
original ideas, inventions, developments and improvements which pertain to
IntriCon’s Proprietary Development Information or which are conceived or
reduced to practice during negotiation or performance of any Joint Development
DSP Improvement Project shall be owned by IntriCon. Dynamic Hearing agrees to
promptly and fully disclose all such ideas, inventions, developments and
improvements to IntriCon, assist IntriCon in obtaining any patents thereon, the
reasonable legal fees and other related fees and expenses to be paid by
IntriCon unless otherwise agreed, and to execute all declarations, assignments
and other documents reasonably necessary to obtain such patents in the name of
IntriCon. Dynamic Hearing agrees not to directly or indirectly aid, assist, or
participate in any action contesting the validity or enforceability of the
patent rights assigned under this Addendum Agreement, except as required by
court order or subpoena. IntriCon agrees to grant Dynamic Hearing a
non-exclusive worldwide paid-up limited license to all such patents assigned to
IntriCon under this section, such license being non-transferrable and limited
to making, using, selling, offering for sale or importing or sublicensing
outside the field of use as defined in section 5 of this addendum. As to any
pre-existing patent rights of Dynamic Hearing which Dynamic Hearing
incorporates into any deliverable provided under any Joint Development DSP
Improvement Project, Dynamic Hearing hereby grants to IntriCon a non-exclusive,
non-transferable, world-wide paid-up license.


4. Copyright Assignment, License.
The Parties agree that any original works of authorship created by Dynamic
Hearing alone or with others and provided in any deliverable of a Joint
Development DSP Improvement Project, and that any other intellectual property,
trade secret and/or know how which resides in any deliverable of a Joint Development
DSP Improvement Project, shall be owned by IntriCon. Dynamic Hearing agrees to
assist IntriCon in obtaining any copyright registrations thereon, the
reasonable legal fees and other related fees and expenses to be paid by
IntriCon unless otherwise agreed, and to execute all declarations, assignments
and other documents reasonably necessary to obtain such copyrights in the name
of IntriCon. Dynamic Hearing agrees not to directly or indirectly aid, assist,
or participate in any action contesting the validity or enforceability of the
copyright rights assigned under this Addendum Agreement, except as required by
court order or subpoena. IntriCon agrees to grant Dynamic Hearing a
non-exclusive worldwide paid-up limited license to all such copyrights assigned
to IntriCon under this section, such license being non-transferrable and
limited to reproduction, distribution and creation of derivative works outside
the field of use as defined in section 5 of this addendum.


5. Field of Use.


The field of use for this license is limited to body worn medical
devices, body worn hearing devices, and miniature low power security devices,
each defined as follows (collectively “licensed devices”), and further limited
to methods of making and using licensed devices. 





Body worn medical devices are ambulatory, low power miniature products
that include one or more sensors to obtain biological data from the wearer.


Body worn hearing devices are products that include either or both a
head worn microphone and a head worn speaker, as well as body worn
communication devices that transmit audio information generated from the
headworn microphone or reproduced by the headworn speaker, provided such body
worn hearing devices are capable of hearing audio application functionality.


Hearing audio application functionality includes amplification of the
sensed audio signal (hearing aids), situational listening devices and
accessories for use in difficult or noisy environments, and industrial and
professional (police, fire, aviation, military and security (both overt and
covert)) voice communications equipment. 


Miniature low power security devices are concealed devices to transmit
audio or audio visual data generated by one or more miniature concealed
microphones and/or miniature concealed cameras, used in covert security
applications. 


6. Confidentiality.
IntriCon Proprietary Development Information is Confidential Information as set
out in section 7 for the Strategic Alliance Agreement.


7. Third Party Notifications.
Dynamic Hearing must notify IntriCon immediately upon becoming aware of: (a)
any claim or allegation that any deliverable provided or to be provided in any
Joint Development DSP Improvement Project would infringe the rights of any
third party; and (b) any knowledge that a third party is infringing
intellectual property rights of IntriCon, including patent or copyright rights
transferred under this Addendum Agreement.


8. Modified Term/Hours Schedule.
The Parties agree to modify the Minimum Payment Schedule as set out in section
4.3 of the Strategic Alliance Agreement to properly reflect the October 1, 2010
payment. The modified payment years will now coincide with calendar years as
follows:


Minimum
Payment Schedule (All amounts are in US Dollars)


	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 PAYMENT
 YEAR



 	
  

 	
  

 	
  

 	
 ACCESS
 FEE



 	
  

 
	
 Year
 3 (1/1/11 – 12/31/11)

 	
  

 	
 $300,000

 
	
 Year
 4 (1/1/12 – 12/31/12)

 	
  

 	
 $300,000

 
	
 Year
 5 (1/1/13 – 12/31/13)

 	
  

 	
 $300,000

 



The new
minimum payment schedule does not maintain any of the exclusive rights as
defined in the Strategic Alliance Agreement.








The parties
agree to modify the first paragraph of section 4.8 and 11.1 of the Strategic
Alliance Agreement as follows:



4.8 Dynamic Hearing shall provide engineering and other services to
IntriCon either as part of a Joint Development DSP Improvement Project or separately.
There will be no charge by Dynamic Hearing to IntriCon for the first 167 hours
of engineering and services provided each month (regardless of whether provided
as part of a Joint Development DSP Improvement Project or separately), however,
any unused hours will not be carried forward as credit to subsequent months or
be entitled to be offset against any future monthly amounts payable for
engineering and services. IntriCon is entitled to utilize such engineering
services for the HH, ALD or PADA markets. Dynamic Hearing will invoice IntriCon
on a quarterly basis 30 days from the end of the quarter for engineering and
services that exceed 167 hours in a single month at the rate of US$150 per
hour. Payments for such services shall be due and payable within 30 days of the
end of that royalty quarter.


11.1 Notwithstanding any provision to the contrary in this Agreement,
this Agreement may not be terminated by either party prior to December 31, 2012
other than failure to pay the minimum payments as defined in section 4.3.


9. Strategic Alliance Unaffected, No Other
License. The Parties agree that, to the extent not
expressly governed hereby, the Strategic Alliance Agreement between the Parties
shall remain in full force and effect, and that the rights and obligations of
this Addendum Agreement shall survive termination of the Strategic Alliance
Agreement under section 11.6(b) thereof. This Addendum Agreement shall be
considered part of the “Agreement” governed by the Indemnity and Limitation of
Liability provisions of section 10 of the Strategic Alliance Agreement. No
other license under any patents, copyrights, trademarks, know-how, trade
secrets or other intellectual property of either party is granted, and none is
to be implied. 


10. General Provisions.


10.1 Dynamic Hearing acknowledges that damages may be inadequate
compensation for breach of this Addendum Agreement and, subject to the
discretion of any court, IntriCon shall be entitled to seek equitable relief
and may restrain, by an injunction or similar remedy, any breach or threatened
breach of this Addendum Agreement. The pursuit or securing of any such
equitable relief shall not prohibit or limit IntriCon’s right to seek or obtain
any other remedy provided under this Addendum Agreement or by law. 


10.2 IntriCon acknowledges that damages may be inadequate compensation
for breach of this Addendum Agreement and, subject to the discretion of any
court, Dynamic Hearing shall be entitled to seek equitable relief and may
restrain, by an injunction or similar remedy, any breach or threatened breach
of this Addendum Agreement. The pursuit or securing of any such equitable
relief shall not prohibit or limit Dynamic Hearing’s right to seek or obtain
any other remedy provided under this Addendum Agreement or by law. 


10.3 The parties do not intend that any partnership or agency
relationship be created by this Addendum Agreement.





10.4 IntriCon may not assign or transfer any of its rights or
obligations under this Agreement without the prior written consent of Dynamic
Hearing. Likewise, Dynamic Hearing may not assign or transfer any of its rights
or obligations under this Agreement without the prior written consent of
IntriCon.


10.5 The parties may sign this Addendum
Agreement in several counterparts, each of which will be deemed an original but
all of which taken together will constitute one instrument. Signatures obtained
via facsimile, photocopy, or electronic photocopy (i.e., “.pdf”) shall be
deemed originals in all cases.


	
  

 	
  

 	
  

 	
  

 	
  

 
	
 DYNAMIC HEARING PTY LTD

 	
  

 	
 INTRICON CORPORATION

 
	
  

 	
  

 	
  

 
	
 /s/ Anthony Shilton



 	
  

 	
  

 	
 /s/ Mark S. Gorder



 	
  

 
	
  

 	
  

 	
  

 
	
 Anthony Shilton

 	
  

 	
 Mark S. Gorder

 
	
  

 	
  

 	
  

 
	
 Title: Chief Executive Officer and Director

 	
  

 	
 Title: Chief Executive Officer

 
	
  

 	
  

 	
  

 
	
 Dated: January 31, 2011

 	
  

 	
 Dated: January 31, 2011

 
	
  

 	
  

 	
  

 
	
 /s/ Tom Harvey



 	
  

 	
  

 	
  

 	
  

 
	
  

 
	
 Tom Harvey

 
	
  

 
	
 Title: Chief Operations Officer

 
	
  

 
	
 Dated:
 January 31, 2011