LICENSE AGREEMENT
THIS LICENSE AGREEMENT, made and entered into this 1st day of December, 1995, by
and between BIO-VASCULAR, INC., a Minnesota corporation ("Bio-Vascular"), and
UROPLASTY, INC., a Minnesota corporation ("Licensee").
BACKGROUND
FIRST. Bio-Vascular is the owner of certain proprietary rights under and
related to United States Patent No. 4,456,589 (hereinafter more fully described
and defined as the "Patent Rights"), which Patent Rights were acquired by
Bio-Vascular from Licensee in accordance with that certain Purchase and Sale
Agreement of even date herewith by and among Bio-Vascular, Bioplasty, Inc.
and Licensee.
SECOND. Uroplasty has been and continues to be in possession of certain
proprietary rights of Bio-Vascular relating to Bio-Vascular's SUPPLE PERI-GUARD
product (hereinafter more fully described and defined as the "Licensed
Know-How").
THIRD. Subject to the terms and upon conditions herein contained, Licensee
desires to make, have made, use, market, and sell certain proprietary products,
and Bio-Vascular is willing to grant Licensee a license under the Patent
Rights and the Licensed Know-How for such purposes.
NOW, THEREFORE, in consideration of the foregoing premises and further in
consideration of the mutual covenants, conditions and agreements contained in
this Agreement and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties to this Agreement
hereby agree and undertake as follows:
ARTICLE I
DEFINITIONS
1. DEFINITIONS. As used herein, the following terms shall have the
following meanings (such meanings to be equally applicable to both the
singular and plural forms of the terms defined):
(a.) AGREEMENT. "Agreement" shall mean this Agreement (together with
all exhibits, schedules, attachments, appendices and addenda) as the
same may be amended, modified or supplemented from time to time.
(b.) EFFECTIVE DATE. "Effective Date" shall mean the date first
written above.
(c.) LICENSED KNOW-HOW. "Licensed Know-How" shall mean the
specialized, novel and unique techniques, practices, knowledge,
expertise and other proprietary information
relating to Bio-Vascular's SUPPLE PERI-GUARD product that is in the
possession of Uroplasty as of the Effective Date, together with any
future improvements, enhancements, updates or other variations of such
know-how developed or acquired by Uroplasty.
(d.) PATENT RIGHTS. "Patent Rights" shall mean the United States
Patent No. 4,456,589, dated June 26, 1984, any corresponding patents
or patent applications filed in other countries, any reissue
applications, continuation applications, and continuation-in-part
applications filed thereon in the United States or any foreign country
and any patents issuing thereon.
(e.) PERMITTED USES. "Permitted Uses" shall mean use of the Patent
Rights and/or the Licensed Know-How by Licensee to make, have made, use,
market and sell (i) proprietary products used in connection with
urology, gynecology or uro-gynecology; and (ii) Licensee's CHONDROPLAST
product, all subject to the terms and conditions set forth herein.
2. RELATED DOCUMENTS. All of the terms defined in this Agreement shall have
the defined meanings when used in any exhibit, schedule, attachment, appendix or
addendum hereto or in any document made or otherwise delivered pursuant to this
Agreement, unless the context otherwise requires.
ARTICLE II
GRANT OF LICENSE
1. LICENSE. Upon the terms and conditions set forth herein, Bio-Vascular
hereby grants to Licensee, and Licensee hereby accepts, a nonexclusive,
worldwide, royalty-free, nontransferable (subject only to assignment in
accordance with Article VII, Section 1 hereof), perpetual (subject only to
termination in accordance with Article VI hereof) license to use the
Patent Rights and the Licensed Know-How for Permitted Uses.
2. USES OTHER THAN PERMITTED USES. Licensee acknowledges and agrees that
any and all uses of the Patent Rights and/or the Licensed Know-How other than
Permitted Uses are strictly prohibited.
3. NONEXCLUSIVITY. Licensee acknowledges that Licensee is not the exclusive
licensee of the Patent Rights or the Licensed Know-How and that Bio-Vascular
may use the Patent Rights and/or the Licensed Know-How for Permitted Uses
or otherwise and grant licenses for the use of the Patent Rights and/or the
Licensed Know-How to third parties for Permitted Uses or otherwise.
4. NO FURTHER DISCLOSURE OBLIGATION. Notwithstanding anything contained
herein to the contrary, Licensee acknowledges and agrees that Bio-Vascular has
no obligation to disclose to Licensee or any third party any information,
technology or know-how relating to its SUPPLE PERI-GUARD product, nor shall
Bio-Vascular have any obligation to train any employees or other representatives
of Uroplasty relating to use of the Patent Rights or the Licensed Know-How.
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ARTICLE III
OBLIGATIONS OF LICENSEE
1. PATENT MARKING. Licensee shall mark every product produced or sold by
it under this Agreement in accordance with the statutes of the United States (or
foreign countries, if applicable) relating to the marking of patented articles,
if applicable.
2. PRODUCT INDEMNITY BY LICENSEE. Licensee shall be solely responsible for
the production of its proprietary products under this Agreement. Licensee shall
indemnify, defend and hold Bio-Vascular, its agents, officers, and employees
harmless from and against any and all liability, damages, cost and expenses,
including attorneys' fees, incurred by Bio-Vascular, its agents, officers, and
employees, as a result of Licensee's production of proprietary products under
the Patent Rights and/or the Licensed Know-How, including specifically,
without limitation, liability, damages, costs and expenses, including attorneys'
fees, incurred by Bio-Vascular, its agents, officers, and employees, by reason
of any claim, alleged or actual defects in the proprietary products produced by
Licensee under the Patent Rights and/or the Licensed Know-How, directly or
indirectly, or by reason of any damage to any person or property resulting from
any claim, alleged or actual defect or insufficient design, materials or
workmanship in the production of proprietary products by Licensee.
3. PRODUCT INDEMNITY BY BIO-VASCULAR. Bio-Vascular shall indemnify, defend
and hold Licensee, its agents, officers and employees, harmless from and
against any and all liability, damages, costs and expenses, including
attorneys' fees incurred by Licensee, its agents, officers, and employees,
as a result of Bio-Vascular's production of proprietary products, including
specifically, without limitation, liability, damages, costs and expenses,
including attorneys' fees, incurred by Licensee, its agents, officers and
employees, by reason of any claim, alleged or actual defects in the proprietary
products produced by Bio-Vascular or by reason of any damage to any person or
property resulting from any claim alleged or actual defect or insufficient
design, materials or workmanship in production of proprietary products
produced by Bio-Vascular.
ARTICLE IV
PROPRIETARY RIGHTS
1. RIGHTS RESERVED. All rights in the Patent Rights and the Licensed
Know-How, other than those granted to Licensee by this Agreement, are hereby
reserved by Bio-Vascular.
2. PROTECTION OF PROPRIETARY RIGHTS. Licensee shall assist Bio-Vascular,
to the extent reasonably requested by Bio-Vascular, in the procurement of any
protection or defense of any of Bio-Vascular's rights to the Patent Rights
and/or the Licensed Know-How. Licensee shall immediately disclose to
Bio-Vascular any facts or circumstances from which it could be reasonably
concluded that a third party is infringing on the Patent Rights and/or the
Licensed Know-How. Bio-Vascular shall have the right, at its own expense and
in its sole and absolute discretion, to
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prosecute all infringements of the Patent Rights and/or the Licensed Know-How.
If the infringement claim is one that cannot by its nature be prosecuted
solely by Bio-Vascular, Licensee shall make available, or cause to be made
available, all information and assistance that Bio-Vascular may reasonably
request. Bio-Vascular shall be entitled to retain any and all recoveries or
settlements realized in connection with its defense of the Patent Rights and/or
Licensed Know-How. In the event Bio-Vascular fails, for whatever reason, to
commence prosecution of all claims of infringement of the Patent Rights and/or
the Licensed Know-How within ninety (90) days following receipt of written
notice of such infringement from Licensee, then Licensee shall be entitled to
prosecute such claims in its own name, at its own expenses and License shall be
entitled to retain all recoveries from said prosecution, whether by judgment,
settlement or otherwise.
3. TRADEMARK. Notwithstanding anything contained herein to the contrary,
Licensee acknowledges and agrees that Bio-Vascular is the sole and absolute
owner of the PERI-GUARD and SUPPLE PERI-GUARD trademarks and that Licensee has
no right whatsoever to use such trademarks or any other trademarks currently
owned by Bio-Vascular for any purpose whatsoever without the prior written
consent of Bio-Vascular.
4. RIGHTS ARE "INTELLECTUAL PROPERTY" UNDER BANKRUPTCY CODE. All
rights and licenses granted by Bio-Vascular to Licensee under or pursuant to
this Agreement are, and shall otherwise be deemed to be, for purposes of
Section 365(n) of the United States Bankruptcy Code (the "Code"), or any
replacement provision therefor, licenses to rights to "intellectual property"
as defined by the Code. The parties further agree that, in the event of the
commencement of bankruptcy proceedings by or against Bio-Vascular under the
Code, that Licensee, as licensee of such rights under this Agreement, shall
retain and may fully exercise all of its rights and elections under the Code.
ARTICLE V
WARRANTIES
1. WARRANTIES OF BIO-VASCULAR. Bio-Vascular hereby represents and warrants
to Licensee that:
(a.) Bio-Vascular has the right to enter into this Agreement, to grant
to Licensee the rights and licenses set forth herein, and to perform all
obligations of this Agreement;
(b.) Execution, delivery, and performance of this Agreement by
Bio-Vascular will not constitute a breach of any agreement, judgment,
award, law, rule, or regulation to which Bio-Vascular is bound; and
(c.) Bio-Vascular has not previously granted any rights under the
Patent Rights that would interfere with any rights granted Licensee
under this Agreement.
2. WARRANTIES OF LICENSEE. Licensee hereby represents and warrants to
Bio-Vascular that:
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(a.) Licensee has the full right, power and authority to enter into and
perform its obligations under this Agreement; and
(b.) Execution, delivery, and performance of this Agreement by Licensee
will not constitute a breach of any agreement, judgment, award, law,
rule, or regulation to which Licensee is bound.
ARTICLE VI
TERMINATION
1. TERMINATION. This Agreement and the licenses granted hereunder may be
terminated upon the occurrence of one or more of the following events, and the
terminating party shall not be liable to the other party for the proper
exercise of such right:
(a.) OPTION TO TERMINATE. This Agreement shall be terminated at the
option of the non-defaulting party upon the material breach of one of
the parties of their obligation to perform or comply with the terms and
conditions of this Agreement and/or that certain Purchase and Sale
Agreement of even date herewith among Licensee, Bioplasty, Inc. and
Bio-Vascular, Inc. (the "Purchase Agreement"). In the event one of the
parties finds the other in material breach of this Agreement and/or
the Purchase Agreement, notice of such breach shall be sent to the
defaulting party in writing. If the breach continues for twenty
(20) days after receipt by the defaulting party of the notice, this
Agreement shall be automatically terminated.
(b.) EVENTS OF AUTOMATIC TERMINATION. This Agreement and the licenses
granted hereunder shall terminate immediately and automatically upon the
happening of any of the following events:
(i) any proceeding under any bankruptcy, reorganization,
insolvency, readjustment of debt, dissolution, liquidation or any
similar law or statute of any jurisdictions commenced by or against
the Licensee; or
(ii) a temporary or permanent receiver is appointed for all or any
portion of the Licensee's business and/or property.
2. EFFECT OF TERMINATION. Upon termination or expiration of this Agreement,
for whatever reason, all provisions relating to proprietary property, patents
or other intellectual property rights shall remain in full force and effect.
Notwithstanding the termination or expiration of this Agreement, each of the
parties hereto shall be required to carry out any provision hereof that
contemplates performance subsequent to such termination; and such termination
shall not affect any liability or other obligation that shall have accrued prior
to such termination, including, but not limited to, any liability for loss or
damage on account of a prior default. Any rights and remedies
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provided in this Agreement shall be cumulative and in addition to all rights and
remedies available at law and in equity.
ARTICLE VII
MISCELLANEOUS PROVISIONS
1. NO ASSIGNMENT OR SUBLICENSE. This Agreement and all rights and licenses
granted or obligations incurred hereunder may not be assigned, sublicensed or
transferred by either party without the prior written consent of the other
party; provided, however, that either party shall have the right to assign its
rights and licenses granted or obligations incurred hereunder to wholly
owned subsidiaries or any third party purchasing all or substantially all of
the business assets of the applicable party hereto or to any third party
through merger with the applicable party hereto.
2. BENEFIT. Except as otherwise provided herein, this Agreement shall
inure to the benefit of and shall be binding upon the parties hereto and
their respective successors and assigns.
3. EQUITABLE RELIEF. The parties agree that any breach of the terms or
covenants of this Agreement will cause the other party irreparable harm for
which there is no adequate remedy at law, and the parties consent to the
issuance of any injunction or other equitable relief in favor of the other
party enjoining the breach of any such covenant or term. In no manner or
effect shall this provision of this Agreement preclude either party from
exercising any right or remedy to which such party may be entitled, at law
or in equity, by reason of a breach by the other party of any term or covenant
of this Agreement.
4. ARBITRATION. Except for any claim by either party for equitable relief
in accordance with Article VII, Section 3 above, any dispute, controversy or
claim arising out of or in connection with this Agreement shall be settled by
binding arbitration in accordance with the then-existing Commercial Rules of
the American Arbitration Association, which arbitration shall take place in
the Minneapolis/St. Paul, Minnesota metropolitan area. Each party shall select
an arbitrator within thirty (30) days of the receipt of any demand for
arbitration and each shall be responsible for compensation of its own
arbitrator. The two arbitrators shall confer and select by mutual agreement
(and at the parties' joint expense) a neutral third arbitrator within sixty
(60) days of the filing of the demand for arbitration. If the parties fail to
appoint their own arbitrator or if the party-appointed arbitrators are unable
to agree upon the neutral arbitrator, the vacancies in the arbitration panel
will be appointed in accordance with the rules of the American Arbitration
Association. The party-appointed arbitrators (but not the neutral arbitrator)
shall have the right to consult with the party appointing them in advance of
the arbitration hearing. It is the intention of the parties that the
arbitration be speedily conducted with the hearing to take place and awards to
be made if possible within ninety (90) days of the filing of the demand for
arbitration. Judgement upon the award of all or a majority of the arbitrators
shall be binding upon the parties hereto and may be entered in any court having
jurisdiction. Specific performance and injunctive relief may be ordered by
the award. Costs and attorneys' fees shall be paid in accordance with the
arbitration award.
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5. WAIVER, MODIFICATION OR AMENDMENT. Unless otherwise expressly provided
in this Agreement and any documents expressly referred to herein, no waiver,
modification or amendment of any term, condition or provision of this Agreement
shall be valid, binding or of any effect unless made in writing, signed by the
parties hereto or their duly authorized representatives and specifying with
particularity the nature and extent of such waiver, modification, or amendment.
Any waiver by any party of any provision hereof shall not affect or impair any
other provision hereof. The failure of any party to enforce at any time any
of the provisions of this Agreement shall not be construed to be a waiver of the
right of such party to subsequently enforce any such provisions.
6. NOTICES. All notices, requests or other communications from either party
hereto to the other shall be in writing and shall be considered to be
delivered or served if sent by a nationally recognized express delivery service
or by first class certified or registered mail, return receipt requested,
postage prepaid to the party at its address as set forth on the signature page
hereto, or to such other address as such party may hereafter designate by
written notice to the other party.
7. LEGAL RELATIONSHIP. Licensee and Bio-Vascular hereby acknowledge and
agree that nothing contained in this Agreement shall be deemed to create an
employment, agency, franchise, or other relationship between Licensee and
Bio-Vascular for any purpose whatsoever and that no relationship is intended
or created hereby other than the relationship of independent contractors.
8. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but together which
shall constitute one and the same instrument.
9. HEADINGS. Section headings used herein are for convenience purposes
only and shall in no way be construed to be a part of this Agreement or as a
limitation of the scope of the particular sections to which such headings refer.
10. INTERPRETATION AND SEVERANCE. The provisions of this Agreement shall
be applied and interpreted in a manner consistent with each other so as to
carry out the purposes and intent of the parties hereto, but if for any
reason any provision hereof is determined to be unenforceable or invalid,
such provision or such part hereof as may be unenforceable or invalid shall
be deemed severed from this Agreement, and the remaining provisions shall be
carried out with the same force and effect as if the provision or part
thereof had not been a part of this Agreement.
11. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Minnesota.
12. ENTIRE AGREEMENT. This Agreement, including any appendices or exhibits
attached hereto or documents expressly referred to herein, contains the
entire agreement between Licensee and Bio-Vascular and supersedes and cancels
any and all other agreements, whether oral or in writing, between Licensee
and Bio-Vascular with respect to the matters referred to herein.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first written above.
LICENSOR: LICENSEE:
BIO-VASCULAR, INC. UROPLASTY, INC.
By: By:
-------------------------------- -------------------------------------
John T. Karcanes, Donald A. Major,
President and Chief Chief Financial Officer
Executive Officer
Address: Address:
Bio-Vascular, Inc. Uroplasty, Inc.
2575 University Avenue 2718 Summer Street, N.E.
St. Paul, Minnesota 55114 Minneapolis, Minnesota 55413
Attn: John T. Karcanes Attn: Donald A. Major
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