CONSULTING AND INTELLECTUAL PROPERTY ASSIGNMENT AGREEMENT
CONSULTING
AND INTELLECTUAL PROPERTY
ASSIGNMENT
AGREEMENT
THIS
CONSULTING AND INTELLECTUAL PROPERTY ASSIGNMENT AGREEMENT (“Agreement”)
is made and entered into as of the 11th day of January, 2006, by and between
Henvil
Corp., an
Ontario Canada corporation
(“Henvil”),
and
▇▇▇▇▇
▇▇▇▇▇▇,
its
sole shareholder and principal, (collectively “Consultants”)
as
parties of the first part,
and
Bovie
Medical Corporation,
organized and existing under the laws of the State of Delaware, (“Bovie”),
as
party of the second part.
W-I-T-N-E-S-S-E-T-H
WHEREAS:
Consultants have experience and expertise in the medical device engineering
and
product development fields; and
WHEREAS
Livneh
is
the creator, owner and inventor of proprietary inventions in the nature of
reusable ergonomic modular disposable and re-usable hand instrumentation
and the
ideas, designs and concepts therefor, as more fully and particularly described
in Exhibits A
and
B hereto
(collectively, the “Inventions”), and WHEREAS Consultants wish to develop and
cause to be developed detailed designs, specifications, quality standards,
plans
and drawings, computer renderings, models and designs, improvements and
modifications, and prototype and pre-production test versions of the Inventions,
to facilitate Bovie’s marketing and distribution of the products derived from
the Inventions in the United States and throughout the world including such
other devices that substantially reflect the Patents and Inventions hereunder
(collectively the “Products”).
WHEREAS
Consultants
are willing to assign to Bovie all right title and interest in the Inventions
and Products pursuant to the terms hereinafter set forth; and
WHEREAS:
On
the
terms and conditions set out herein, Bovie is willing to engage Consultants
to
assist Bovie and Consultants are willing to assist Bovie, in developing detailed
designs, specifications, quality standards, plans and drawings, computer
renderings, models and designs, improvements and modifications, and prototype
and pre-production test versions, of the Inventions and Products while
protecting Bovie’s intellectual property and trade secret rights in and to the
Inventions, and certain related confidential information.
NOW,
THEREFORE, in
consideration of the mutual undertakings and covenants set out herein, the
parties expressly acknowledge and agree as follows:
-1-
1.
Consultants’
Services
1.1 Engagement:
Bovie
hereby engages Consultants to perform, and Consultants agree to perform,
the
services enumerated herein, for the Term set forth herein, unless the engagement
is sooner terminated.
1.2 Provision
of Equipment and Machinery: Bovie
shall, within thirty (30) days after the date hereof, but subject to Force
Majeure, purchase (and/or lease) and cause to be delivered to Henvil’s facility
in Canada, if readily available, the necessary equipment and machinery valued
at
$400,000 which is listed and described on Exhibit C
for use
by Consultants in performing their Services and Scope of Work (as hereafter
defined), subject to Section 1.2.2 below. Consultants acknowledge that for
all
purposes herein, Bovie is the owner of the equipment and machinery, with
owner’s
prerogative to exercise all indicia of ownership in any manner and for any
reason, including but not limited to, removal of such equipment to its
manufacturing location in Florida or elsewhere, on 90 days notice to
Consultants.
1.2.1 Standard
of care:
Consultants shall utilize the machinery and equipment in conformity with
good
design and manufacturing practices exercising the appropriate standard of
care
for the proper maintenance of the machinery and equipment and the safety
of the
personnel operating same.
1.2.2 Use
for other Purposes:
In the
event the equipment is used for any purpose other than what is contemplated
by
this Agreement, Consultants shall notify Bovie in writing of the nature of
the
use and shall compensate Bovie on terms and amount to be agreed upon prior
to
such intended use.
1.2.3 Insurance: For
as
long as the equipment and machinery is located at consultants’ facility,
Consultants shall purchase and keep in effect property insurance covering
the
equipment and machinery specified in Exhibit C in an amount equal to the
greater
of $400,000 or the actual value thereof, with Bovie as a named
insured.
1.3 Standard
of Performance:
Consultants acknowledge that Bovie is entrusting to them with highly sensitive
confidential and commercially-valuable information, not generally known,
and
relying expressly on Consultants’ discretion, experience, and expertise: (a) to
develop detailed designs, specifications, quality standards, plans and drawings,
computer renderings, models and designs, improvements and modifications,
and
prototype and pre-production test versions, of the Inventions, in a good
and
professional manner, consistent with best practices and the standard of care
in
the medical device design and engineering industry, taking into account time
and
budgetary constraints imposed by Bovie; and (b) to keep confidential and
to
preserve Bovie’s trade secrets and confidential information, and that, in
consequence, they will occupy a special position of trust and confidence
with
respect to Bovie. Consultants hereby agree that, in the course of performing
the
services enumerated herein, they will at all times use reasonable efforts
to
advance Bovie’s interests, and loyally and faithfully, subject to Force Majeure,
to perform their obligations for Bovie’s benefit.
-2-
1.4 Services:
Subject
to Force Majeure events, Consultants hereby agree to perform the services
set
out in the Scope of Work, attached hereto as Exhibit D
hereto,
not later than the times specified for completion of the Scope of Work, as
the
same may be amended by mutual agreement of the parties from time to time
(the
“Services”). The Scope of Work and delivery date may be modified or augmented
from time to time by mutual, written agreement signed by the parties, acting
reasonably.
1.5 Limitations
on Consultants Authority in Respect of Dealings with Third
Parties:
Each
Consultant shall have no authority or power to bind Bovie to any obligations
or
undertakings with third parties, nor shall Consultants represent that they
have,
or hold themselves out as having; or imply or suggest that he has; such
authority or power. All negotiations and negotiating positions with any third
parties are subject to approval by Bovie. All agreements, understandings
and
contracts with third parties must be in writing, and duly executed by an
officer
of Bovie in order to be effective against Bovie. Consultants shall disclose
to
third parties the foregoing limitations on their authority where and when
reasonably necessary to avoid creating misapprehensions or misunderstandings
on
the part of such third parties as to the scope of Consultants’
authority.
1.6 Independent
Contractor Status:
Consultants and Bovie are contractors independent of one another, and
Consultants shall not be considered the employee, partner or joint venturer
of
Bovie, or subject to the execution and performance hereof, the owner of any
interest in the Inventions or business associated with it. Subject to the
provisions of this Agreement, Consultants shall be free to perform the services
required hereunder at the times, in the places, and in the manner they deem
fit.
Except as expressly provided herein and subject to the provisions of section
2.1
hereof, Consultants shall provide, at their cost and expense, all
transportation, personnel, equipment, insurance and supplies needed to perform
the Services. Bovie is contracting for the results set out in the Scope of
Work,
and Consultants shall control the details of their performance. Consultants
shall be liable for and responsible for payment of any and all taxes that
may be
due upon compensation earned by them under this Agreement.
1.7 Bovie’s
Efforts to Exploit the Inventions: Bovie
agrees that it shall use reasonable efforts to exploit commercially the
Inventions, and that Bovie shall bear all costs of marketing of the Products.
Bovie shall have sole, exclusive, and unfettered discretion as to the means
by,
and terms and conditions under, which Bovie shall endeavor to exploit the
Inventions and Bovie does not guarantee or make any warranties or
representations whatsoever to Consultants that such efforts will be successful,
or will result in any level of revenue, income or profit.
-3-
2. COMPENSATION
2.1 Development
Compensation: Bovie
shall pay to Consultants, monthly for a period of twelve (12) months, the
sum of
thirty thousand ($30,000) or for less than a month, an appropriately pro-rated
portion thereof (“Consulting Fee”) commencing with the execution hereof, in
support of Consultants’ preparations and performance of their Services and Scope
of Work hereunder plus the cost of tools and molds up to a maximum cost of
$120,000.00 if required for the Scope of Work, all of which is subject to
approval of Bovie which shall be the owner of such tools and
equipment.
2.2
Royalty
Fee:
Commencing with the period immediately following one year after the date
of the
first sale or commercial delivery of the Product for use and continuing for
a
period of four years thereafter, Bovie shall pay on a quarterly basis to
Livneh,
or an entity designated by him in writing, which is at least 50% owned and
controlled by Livneh, a minimum royalty (“Initial Minimum Royalty”) consisting
of the greater of $35,000 per year or 3% of Adjusted Gross Revenues received
(as
hereinafter defined) inclusive of Product delivery for use and such other
device(s) that substantially reflect the work performed by Consultants
hereunder, namely variants of the reusable ergonomic modular disposable and
re-usable hand instrumentation, embodied by the Inventions, during the Term,
if
any. Commencing with the quarterly period following the end of the aforesaid
four-year period and continuing thereafter for the balance of Term of this
Agreement, Bovie shall pay to Livneh, or his designee, a royalty payment
(“Ongoing Royalty”) equal to 2.5% of such Adjusted Gross Revenues. Except as
expressly provided in this Agreement, no Royalty shall be payable on account
of
sale, licensing or otherwise of any other Bovie services or product other
than
the Products, or on account of any other revenue or income received or accrued
by Bovie, from whatever source derived.
2.2.1
Adjusted
Gross Revenues:
As used
herein, the term “Adjusted Gross Revenues” shall mean Bovie’s gross sales (the
gross amount billed Bovie customers inclusive of distributors) of the Products
on account of the sale or delivery for use of the Products and any other
device
that substantially embodies the Inventions and work performed by Consultants
hereunder less (i) shipping costs and (ii) commissions payable to third parties
(not including employees, consultants or contractors of Bovie) (iii) returns,
and (iv) royalty payable on demo models supplied.
2.2.2
Payment
Terms; Content of Fee Statements:
The
Royalty shall be payable to Consultants on a calendar quarterly basis. Not
later
than thirty (30) days after the last day of the previous calendar quarter,
Bovie
shall remit to Consultants the amount of the Royalty due on Gross Revenues
actually received and credited on account of the sales of the Products during
the previous quarter, if any. With each such payment, Bovie shall deliver
to
Consultants a statement, showing, for the previous calendar quarter, the
total
amount of revenues received by Bovie on account of the sales or delivery
for use
of the Products derived from the Inventions including such other device that
substantially embodies the work performed by Consultants hereunder, the amount
of gross revenues received and royalty payable for such quarter. Consultants
and their agents shall be entitled not more than once per calendar year during
the Term of this Agreement, on ten (10) days prior written notice, to inspect,
audit and copy the books and records of Bovie
-4-
relevant
to the Royalty, in Bovie's premises during Bovie’s normal business hours. If
such inspection reveals an error in an amount equal to or greater than $1000
concerning the calculation of the Royalty, then Bovie shall pay any amount
due
and promptly reimburse the actual and reasonable costs of Consultants in
connection with such inspection and audit. Bovie shall promptly correct any
such
accounting error upon discovery, whether pursuant to such an inspection or
audit
or otherwise and advise the Consultants accordingly.
2.3 Stock
Options:
As
additional compensation for ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ shall, subject to Section
2.3.1
below, issue to Livneh, a company owned 50% or more by him or to a family
member
designated by him, when requested, a total of 100,000 restricted stock options
to purchase 100,000 restricted shares of Common Stock of Bovie, exercisable
at
the closing price for Bovie’s Common Stock on the American Stock Exchange as of
at the close of business on the date requested.
2.3.1 Vesting
of Options:
The
aforesaid stock options shall not vest until such time as Bovie formally
receives section 510K approval from the FDA for each of the Arthroscopic
and Lap
Choly classes of instrumentation subject to the application, at the rate
of 50%
each (or a total of 50,000 options shall vest for each class of instrumentation
so approved); provided that Bovie, at its expense, shall apply for section
510K
approval within a reasonable period after Henvil's delivery of drawings for
each
class of Products described in Exhibit -A
and
B.
2.3.2 Consultants
acknowledge that such options shall be restricted stock options which are
acquired for investment and shall have a term of five
years.
2.3.3 Exercise
of the restricted stock options shall give the holder of such options the
right
to acquire restricted shares of common stock of Bovie and future transfer
and/or
sale of the shares so purchased may only be made in compliance with the
Securities Act of 1933, as amended.
2.4
Payment
of Fees Ordinary Contractual Obligation of Bovie; No Trust:
Bovie’s
obligations to pay Royalty to Consultants shall be regarded as an ordinary
contractual obligation of Bovie’s only, and Bovie shall not be deemed, expressly
or by implication, to hold any part of its revenues or income derived on
account
of sale of Product derived from the Inventions as a trust for the benefit
of
Consultants.
2.5 Transmission
of Payments.
Bovie
agrees to transmit all payments due Consultants under this Agreement to Henvil
or ▇▇▇▇▇ ▇▇▇▇▇▇, as directed by Henvil in writing .
-5-
3.
CONFIDENTIAL
INFORMATION:
3.1 Mutual
Nondisclosure Agreement.
Consultants
and Bovie acknowledge that, by virtue of this Agreement, each will have access
to confidential information belonging to the other. Accordingly, the parties
agree to respect and fulfill at all times the terms and conditions of the
Mutual
Nondisclosure Agreement attached hereto as Exhibit E,
which
is incorporated herein by reference.
3.2 Inventions
and Consultants’ Work Product Proprietary to Bovie Consultants
acknowledge that upon execution of this Agreement, the Inventions and all
designs, plans, drawings, standards, specifications, modifications, technical
information, prototypes, test versions, and models associated with the
Inventions as conceived or developed by Consultants (both before and after
the
execution of the agreement) and the work to be performed by Consultants for
Bovie under this Agreement shall become the exclusive intellectual property
of
Bovie and shall be subject to the protections of applicable United States
and
international trademark trade secret, copyright and patent law. Consultants
further acknowledge that all original works of authorship which are made
by
Consultants (solely or jointly with others) within the Scope of Work and
during
the Term of this Agreement which are protectable copyright law are “works made
for hire,” as that term is defined in the United States Copyright Act, as
amended.
3.3 Injunctive
Relief: Consultants
further acknowledge that unauthorized disclosure or use of Confidential
Information or Trade Secrets or infringement of Bovie’s intellectual property
rights in and to the Inventions or Products would result in great harm and
injury to Bovie, which would not be readily compensable in money damages.
Accordingly, Consultants agrees that, without waiving any additional rights
and
remedies otherwise available to Bovie at law, in equity, or by statute, Bovie
shall be entitled to preliminary and permanent injunctive and other equitable
relief, and waive bond or other security as a condition of such preliminary
relief, in the event of Consultants’ breach or threatened breach of any covenant
contained in this section 3.
3.3.1 Bovie
acknowledges that during the term of agreement, unauthorized disclosure or
use
of confidential information or Trade Secrets provided by Consultants or
infringement of Consultants' intellectual property rights would result in
great
harm and injury to Consultants, which would not be readily compensable in
money
damages. Bovie further acknowledge that unauthorized disclosure or use of
Confidential Information or Trade Secrets or infringement of Consultants
intellectual property rights in and to Consultant’s inventions, would result in
great harm and injury to Consultants, which would not be readily compensable
in
money damages. Accordingly, Bovie agrees that, without waiving any additional
rights and remedies otherwise available to Consultants at law, in equity,
or by
statute, Consultants shall be entitled to preliminary and permanent injunctive
and other equitable relief, and waive bond or other security as a condition
of
such preliminary relief, in the event of Bovie’s breach or threatened breach of
any covenant contained in this section 3
-6-
4.
ASSIGNMENT
OF INVENTIONS AND TECHNOLOGY:
4.1
Assignment
of Work Product and Intellectual Property to Bovie. Consultants
agrees to, and hereby does, without any additional consideration, irrevocably
and unconditionally assign and transfer outright all their respective right,
title and interest in and to (a) any and all materials and work product created
or developed by Livneh in the course of performing services under this Agreement
(“Work Product”); (b) any and all Inventions, improvements, modifications
(whether or not the same be reduced to written or computer-readable form)
derived from the Inventions, the Services performed or Work Product created
by
Consultants hereunder, including but not limited to designs, drawings,
specifications and standards, improvements and modifications and pictorial
or
graphic representations of images, prototypes models and test versions; and
(c)
any and all copyrights, trademarks, patents and patent rights, and applications
therefor, if any, and any and all other intellectual property and/or industrial
property rights in and to any and all of the foregoing (collectively
Intellectual Property”).
4.2 Disclosure
of Work Product. Consultants
agree to execute any instruments, applications, and documents, and to do
all
other things reasonably requested by Bovie at Bovie’s expense (both during and
after Consultants’ engagement with Bovie) in order to vest more fully in Bovie
all Intellectual Property and other ownership rights in those items transferred
by Consultants to Bovie in Section 4.1 hereof.
4.3
No
License or Permit Granted. Subject
to Section 5.3 and excluding territories outside North America, nothing herein
shall be deemed to grant or give Consultants any express or implied license
or
right to use, disclose, practice or reduce to practice, or permit or sublicense
any third party to use, disclose, practice or reduce to practice, all or
any
part of the Inventions, Confidential Information, Products or the Intellectual
Property of Bovie, except strictly in accordance with the terms of this
Agreement for the purposes expressly contemplated herein, all of such rights
being hereby expressly reserved by Bovie.
4.4
Intellectual
Property and Independent Business of Consultants.
Nothing
herein shall be deemed to ▇▇▇▇▇ ▇▇▇▇▇ an interest of any kind or license
in any
inventions or intellectual property of Consultants (other than the Intellectual
Property or Work Product expressly assigned to Bovie in this Agreement).
Bovie
acknowledges that Consultants have been and will continue to be engaged in
other
business activities, including without limitation the business of developing
other medical devices provided; however, such other activity does not materially
impair or conflict with Consultants’ obligations hereunder. Nothing herein shall
be deemed to prevent or limit the ability of Consultants to continue their
independent business activities after the execution of this Agreement, so
long
as they do not use, disclose or infringe upon the Intellectual Property or
Work
Product expressly assigned to Bovie in this Agreement.
-7-
5.
CONSULTANTS’
WARRANTIES AND REPRESENTATIONS: INDEMNITY AND HOLD HARMLESS:
5.1
Warranty:
Consultants warrant and represent that to the best of their knowledge and
belief
(a) the Work Product and Intellectual Property and any respective part(s)
thereof does not and will not infringe any (i) U.S patent; or (ii) trade
secret
or other confidentiality, exclusivity, or proprietary rights of any third
party.
Consultants have received from ▇▇▇▇▇▇ & ▇▇▇▇▇▇ Attorneys the letter dated
November 22, 2005 attached hereto as Exhibit F
with
respect to the Intellectual Property; and shall request such firm to permit
Bovie to rely theron; (b) the Intellectual Property is free and clear of
any and
all third party security interests or encumbrances arising by some relationship
with Consultant; (c) neither the execution of this Agreement nor the, grant
of
the rights granted to Bovie hereunder, violates any confidentiality,
exclusivity, license or contractual right of any third party; and (d)
Consultants shall perform the Services in a good and professional manner.
Consultant does not warrant the truth, accuracy or validity of the opinion
attached as Exhibit F.
5.2
Infringement For
a
period of three and on-half years following the first payment of the Initial
Royalty hereunder, (a) in the event Bovie receives notice from a third party
of
an infringement claim or threat thereof that is within the scope of Consultant’s
representation made in Section 5.1(a), then Consultant shall, if requested
by
Bovie, exert their best efforts to replace Consultant’s Work Product (including
design) with non-infringing Work Product, at Bovie’s reasonable cost and
expense; and (b) Consultant’s monetary indemnity obligations to Bovie under this
section shall be satisfied exclusively through offset, limited to 55%, of
future
amounts payable to Consultants under Section 2.1 of this Agreement. (c) In
the
event litigation is commenced against Bovie over an alleged infringement,
a
total of 55% of any future Royalty payment payable to Livneh hereunder shall
be
withheld by Bovie to be applied against legal fees incurred in such defense.
If
Bovie wins the litigation, it shall reimburse Livneh for any and all such
Royalty amounts withheld. If Bovie determines to settle the litigation, the
parties shall consult and mutually agree as to the extent, if any, Livneh
shall
be reimbursed.
5.3 Non-Compete,
For as
long as Livneh receives royalties hereunder, Consultants shall not compete
directly or indirectly with Bovie by offering instrumentation that infringes
the
Patent and Intellectual Property acquired hereby in any market in which Bovie
markets the Products.
5.4 Additional
Covenants
5.4.1
Consultants further covenant and represent that, during the Term of this
Agreement they shall exercise commercially reasonable efforts on a part-time
basis to perform the tasks specified on Exhibit D attached
hereto, which is incorporated herein by reference.
-8-
5.4.2 Bovie
covenants and represents that it shall: (a) Undertake to complete applications
maintenance and support for obtaining U.S. patents on Inventions including
compliance with and payment of costs and fees associated therewith inclusive
of
applications for foreign Patents that Bovie deems appropriate; (b) obtain
competitive samples of products pursuant to Consultants’ request; (c) provide
final packaging and marketing materials, (d) assist Consultants in interfacing
the Products to be developed with Bovie’s electrosurgical generators; (e)
provide field testing, evaluations and validations for the Products; (f)
provide
all regulatory services for the products developed, inclusive of 510k
registration and qualification; (g) provide warehousing of inventory and
shall
commence marketing and sales efforts within 15 days of delivery of product
for
commercial exploitation of the products developed from the Inventions and
Intellectual Property acquired hereby; (h) reimburse all reasonable expenses
incurred by Livneh for visitations with Bovie or at Bovie’s request to provide
assistance as needed; (i) provide passes and reimbursed expenses to Livneh
for
his attending the following conventions in the first two years of the Agreement:
AAOS, AORN, AAGL, ACS, SAGES and Medica in Dusseldorf, Germany.
6. SURVIVAL:
Consultants’ and Bovie’s obligations under Sections 3, 4 and 5 of this Agreement
(as applicable) shall survive expiration or termination of this Agreement
for
any reason.
7.
TERM
AND TERMINATION This
Agreement shall commence upon its execution by each party hereto and shall
continue for the life of the patents thereafter.
7.1 Either
party shall have the right to terminate this Agreement by delivering to the
other party a written notice of termination upon the occurrence of any of
the
following events:
(a)
Should a party breach any material obligation hereunder, then the non-breaching
party shall give written notice in writing to the breaching party, calling
the
breaching party’s attention to such breach, and the breaching party shall have
60 days to remedy the breach. If the breaching party fails to remedy the
breach
within said 60 days, then the non-breaching party may terminate this Agreement
with immediate effect;
(b)
Should the other party suspend the payments of its debts, admit that it is
unable to pay its debts as they become due or if bankruptcy or insolvency
proceedings are filed by or against such other party and the same have not
been
dismissed within 60 days following such filing;
(c)
If a
party makes a general assignment for the benefit of its creditors;
7.2
Consultants
shall have a further right to terminate this Agreement on fifteen (15) days
advance notice in writing, with a concomitant right in Bovie of fifteen (15)
days to cure, in the event that:
-9-
(a) Bovie
sells or distributes any other product that competes with the Products;
or
(b) Bovie
fails to pay Consultants the Royalty specified in Section 2.1 in any calendar
year during the Term of Agreement, beginning with the 2007 calendar
year.
8.
MISCELLANEOUS
8.1 All
currency compensation hereunder shall be in US dollars.
8.2
This
Agreement shall be binding upon, and shall inure to the benefit of, each
of the
parties’ heirs, successors, successors in interest, permitted assigns, and legal
representatives. Without the advance written consent of Bovie, which may
be
withheld in Bovie’s sole discretion, Consultants may not (a) subcontract or
delegate their duties hereunder to, or (b) perform such duties by or through,
any person or entity other than ▇▇▇▇▇ ▇▇▇▇▇▇ or ▇▇▇▇▇▇, or assign their rights
hereunder to any other person or entity unless such entity is at least 50%
owned
and controlled by ▇▇▇▇▇ ▇▇▇▇▇▇. Upon assignment of this Agreement by Bovie,
assignee shall become liable to Consultants for all obligations of Bovie
hereunder, without relieving Bovie’s liability hereunder. In the event of any
default by assignee under this Agreement, Consultants may, at their option,
but
without any obligation to do so, elect to treat such assignment as a direct
Agreement with Consultants and pursue all available legal and equitable remedies
directly against Bovie.
8.3
This
Agreement shall be deemed to have been made within, and the rights and remedies
of the parties shall be determined in accordance with the laws of, the State
of
New York, regardless of where actually executed by any party, and without
regard
to the choice of and conflict of laws principles of New York or the place
or
places of execution. The parties hereby designate the Courts of New York
as the
sole and exclusive forum for resolution of any disputes arising under this
Agreement and claims for breach thereof, and further, each of the parties
hereby
expressly consents to that forum, and to the exercise of personal and subject
matter jurisdiction by such Court, waiving affirmatively any objection
thereto.
8.4
This
Agreement may be executed in counterpart originals, all of which together
shall
constitute a single agreement. This Agreement may be executed by any party
in
the form of a facsimile signature and, for purposes hereof, each such facsimile
signature shall be deemed to be an original signature, binding such party
to the
terms and provisions of this Agreement.
8.5 Any
notice or other communication required or permitted under this Agreement
shall
be given in writing, and delivered via hand, electronic mail, facsimile,
overnight courier service, or registered or certified mail, return receipt.
Any
such notice shall be effective against the party to whom it is addressed
upon
delivery as follows:
-10-
|
If
to Bovie:
|
Name:
|
|
|
Attention:
|
▇▇▇▇▇
Citronowicz
|
|
|
Address:
|
▇▇▇▇
▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇.
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
|
|
|
Fax:
|
(▇▇▇)
▇▇▇-▇▇▇▇
|
|
|
If
to Consultants:
|
Name:
|
Henvil
Corp.
|
|
Attention:
|
▇▇▇▇▇
▇▇▇▇▇▇
|
|
|
Address:
|
▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇
▇▇▇▇▇▇
N9VIX3
|
|
|
Fax:
|
(▇▇▇)
▇▇▇-▇▇▇▇
|
Each
party hereto shall promptly notify in writing, the other parties of any change
in the foregoing contact information.
8.6
This
Agreement and attached Exhibits A,
B,
C,
D,
E,
and
F
which
are incorporated herein by reference, constitute
the entire agreement between and among the parties as to the subject matter
hereof. It sets forth all of the covenants, promises, agreements, conditions,
and understandings between and among the parties, and there are no other
representations, statements, warranties, covenants, promises, agreements,
conditions, and understandings, express or implied, oral or written, relating
to
the subject matter of this Agreement. This Agreement may not be changed or
modified or amended, in whole or in part, except in writing executed by the
parties hereto.
8.7 In
this
Agreement "Force Majeure" means delays caused by war or insurrection, flood,
earthquake, major explosion, fire or other casualty, major weather differences
from the normal weather conditions for the area in which the Premises are
located, or acts of God, labour disputes, terrorist attacks, refusal or failure
of governmental authorities to grant necessary approvals and permits or
subsequent withdrawal of such approval or permits by the appropriate
authorities, but in no event shall the lack of funds qualify as Force
Majeure.
8.8 (a) Despite
anything to the contrary contained herein, but subject to Section 8.8(b),
if
either party is bona fide delayed or hindered in or prevented from performing
any term, covenant or act required to be performed under this Agreement by
reason of an act of Force Majeure, then the performance of such term, covenant
or act shall be excused for the period of the delay. Upon the reason for
the
delay being rectified, the party so delayed shall thereafter perform such
term,
covenant or act within the appropriate period after the expiration of the
period
of such delay.
(b) Nothing
in Section 8.8(a) excuses:
|
|
(i)
|
a
delay caused by lack of funds or other financial circumstances
of any
party;
|
-11-
|
|
(ii)
|
a
delay primarily the fault of the party alleging that it has been
hindered
or delayed; or
|
(iii) Bovie
from paying Royalties or fees when due and payable.
8.9
Any
failure by one party to insist on strict and timely performance of the
obligations of the other parties on one or more occasions shall not constitute
a
waiver of such party’s right to strict and timely performance on any other
occasion.
8.10
The
headings and subheadings used in this agreement are for convenience only,
are
not intended to describe, construe or interpret this Agreement, and do not
constitute substantive provisions, or create or modify any rights or obligations
created by the substantive provisions of this Agreement.
8.11
If
any
provision or part of this Agreement shall be found to violate any law or
otherwise be found to be legally defective, void or unenforceable, such
provision or part shall be severed, without affecting the binding effect
and
enforceability of any other provisions, which remaining provisions shall
remain
fully binding and enforceable according to their terms.
8.12
Whenever
the context so requires, the singular shall include the plural and the plural
shall include the singular, and the gender of any pronoun shall include the
other gender or neuter.
[The
signatures of the parties appear on the next succeeding page.]
-12-
IN
WITNESS WHEREOF, the
parties set their hands and seals hereto, as of the date first
written.
|
BOVIE
MEDICAL CORPORATION
|
HENVIL
CORP.
|
|
By:
|
By:
|
|
▇▇▇▇▇
Citronowicz, Vice President
|
▇▇▇▇▇
▇▇▇▇▇▇, CEO
|
|
▇▇▇▇▇
▇▇▇▇▇▇, Individually
|
-13-
EXHIBIT
A
The
description of the instruments is below:
Arthroscopic
instruments covered by the said agreement:
MF
(Modular Forceps) description-Arthroscopy
The
MF
family of Arthroscopic hand instruments consists of a reusable, ergonomically
superior handle and disposable and reusable, cleanable cable/tube/tip assembly
(tip).
The
modular feature allows using the same handle with a variety of tip styles,
i.e.
blunt nose, scooped nose, predator, duckbill, shovelhead styles. Loading
and
ejecting tips is easy and safe.
The
tips
may be cleaned via a flushing port and in some cases even
re-sharpened.
The
advantages in the MF concept are:
Reduced
cost and simplified inventory to the end user.
A
flushing port that will allow inside flushing.
Much
improved ergonomics to the surgeon, resulting in less fatigue and easy
adaptation of the MF.
The
MF
handle and the elements of the tips are the subject of US Patent Application
No.
60/717074.
The
MF
Arthroscopic tip styles to be developed and manufactured under this agreement
are:
3.4
▇▇
▇▇▇▇▇ punch
2.7
▇▇
▇▇▇▇▇ punch
3.4
mm
scoop punch
2.7
mm
scoop punch
3.4
mm
grasper
3.4
mm
scissors
-14-
EXHIBIT
B
Lap-Choly
MF (Modular Forceps) description
The
MF
family of Lap-Choly (LC) hand instruments consists of a reusable, ergonomically
superior, insulated handle and disposable, and reusable, cleanable
cable/tube/tip assembly (tip).
The
modular feature allows using the same handle with a variety of tip styles,
i.e.
scissors, graspers, dissectors, needle holders and other styles. Loading
and
ejecting the tip is easy and safe.
The
tips
may be cleaned via a flushing port and in some cases re-sharpened.
The
advantages in the MF concept are:
Reduced
cost and simplified inventory to the end user.
A
flushing port that will allow inside flushing.
Much
improved ergonomics to the surgeon, resulting in less fatigue and easy
adaptation of the MF. The handles insulated while still providing metal handle
grips and available ratchet-an industry first.
The
MF
handle and the elements of the tips are the subject of US Patent Application
No.
60/717074
The
MF
lap-choly tip styles to be developed and manufactured under this agreement
are:
5
mm
curved scissors.
5
mm
Maryland dissector
5
mm
Allis grasper
5
mm
Predator style grasper
5
mm
Atraumatic grasper
5
mm
Needle holder
-15-
EXHIBIT
C
|
BOVIE-MF
PROJECT
|
|
PRELIMINARY
EQUIPMENT LIST
|
|
11-08-2005
|
|
ITEM#
|
DESCRIPTION
|
QUANT.
|
COMMENTS
|
|
MACHINES:
|
|||
|
1.
|
20
MM Multi-Axis, Double Spindle, Powered tools
SWISS
LATHE.
|
1
|
New
|
|
2.
|
16
MM multi-axis, double spindle, powered tools
SWISS
LATHE
|
1
|
New
|
|
|
|||
|
3.
|
HIGH
SPEED VMC, INCL. REAL TIME 4TH
AXIS INCLUDING TOOLING
|
1
|
NEW
|
|
4.
|
TOOLS
ROOM CNC MILL INCLUDING TOOLING
|
1
|
NEW/USED
|
|
5.
|
TOOL
ROOM LATHE
|
1
|
NEW/USED
|
|
6.
|
CENTERLESS
GRINDER
|
1
|
NEW/USED
|
|
7.
|
SURFACE
GRINDER, SEMI-AUTOMATIC
|
1
|
NEW/USED
|
|
8.
|
WIRE
EDM SUBMERSIBLE
|
1
|
USED
|
|
9.
|
LASER
WELDER, MANUAL, PLUS ROTARY/LINEAR
FIXTURES
|
1
|
NEW
|
|
10.
|
DRILL
PRESS
|
1
|
NEW
|
|
11.
|
MANUAL
MILL (I.E. BRIDGPORT)
|
1
|
NEW/USED
|
|
Q.C.
EQUIPMENT:
|
|||
|
1.
|
COMPARATOR
WITH FIXTURES
|
2
|
NEW/USED
|
|
2.
|
MICROSCOPE
W/VIDEO CAMERA
|
1
|
NEW/USED
|
|
3.
|
GRANITE
SURFACE PLATE + STAND
|
1
|
NEW/USED
|
|
4.
|
GAUGE
PINS AND BLOCKS
|
2
|
NEW
|
|
5.
|
HEIGHT
GAUGE
|
1
|
NEW
|
-16-
|
MISCELANEOUS:
|
|||
|
1.
|
BUFFING
MACHINE
|
2
|
NEW/USED
|
|
2.
|
TIG/MIG
WELDER
|
1
|
NEW
|
|
3.
|
ULTRASONIC
CLEANER
|
1
|
NEW/USED
|
|
4.
|
SAND
BLASTER
|
1
|
NEW
|
|
5.
|
AIR
COMPRESSOR 15-25 HP
|
1
|
NEW
|
|
6.
|
CITRIC
ACID PASSIVATION STATION
|
1
|
NEW
|
|
7.
|
ELECTROPOLISH
STATION
|
1
|
NEW
|
NOTE:
SOME
ALTERATION AND CHANGES MAY OCCUR, BASED ON EQUIPMENT AVAILAILABITY AT THE
TIME
OF PURCHASE/LEASE.
EXHIBIT
D:
-17-
SCOPE
OF WORK:
|
Consultants
Shall:
|
Time
Frame:
|
|
(a)
Complete designs of initial offerings of Arthroscopic and Lap-Choly
instruments and each respective set of instrumentation is referred
to
herein as a family of products.
|
8
weeks per family of instruments
|
|
(b)
Complete Pre-production protoyping for all first generation
products;
|
within
3 months after installation of necessary equipment
|
|
(c)
Advise and assist Bovie in connection with patent maintenance and
expansion(s) of patents and patent applications.
|
__
|
|
(d)
Provide assistance in testing and evaluations to be made of all
Products
derived from the Inventions;
|
__
|
|
(e)
Prepare and provide Quality Control specs and procedures;
|
Within
4 weeks of delivery of drawings for each family of
instruments
|
|
(f)
Prepare and provide manufacturing drawings, process sheets and
specs
relating to the Inventions;
|
within
8 weeks after delivery of drawings for each family of
instrument
|
|
(g)
Prepare and provide all documentation reasonably requested as per
Bovie’s
QSR, including design history file and risk analysis documentation,
and
operating manual.
|
To
be in place prior to launch of each family of instruments, to take
place
within 16 weeks after the applicable equipment is in place for
the
1st
family of instruments;
|
|
(h)
Provide assistance and training to Bovie’s assembly team, under separate
agreement to be mutually agreed, if and when needed;
|
__
|
|
(i)
Assist in packaging design and sourcing for Bovie’s Marketing
Program;
|
__
|
|
(j)
Design and manufacture assembly fixtures, tools and accessories
in Henvil
Facility under separate, written agreement to be mutually agreed,
which
shall provide Consultants with a right of first refusal to manufacture
Products derived from the Inventions for a price equal to the average
price quoted by three competing manufacturers;
|
__
|
|
(k)
Provide technical assistance to Bovie in all relevant areas including
field testing;
|
__
|
|
(l)
Provide ▇▇▇▇▇ ▇▇▇▇▇▇, to the extent he is available, for participation
in
engineering and marketing meetings and discussion pertaining to
the
Inventions and Products; and
|
__
|
|
(m)
Give first priority to manufacturing of Bovie electrodes components
(arthroscopic ablation electrodes) at reduced prices (Parties acknowledge
that final prices are to be determined pending final design, quantities
and equipment availability).
|
__
|
-18-
EXHIBIT
E:
MUTUAL
NON-DISCLOSURE AGREEMENT
This
Mutual Non-Disclosure Agreement (“Agreement”)
dated
December__, 2005, is entered into by and between Henvil
Corp., an
Ontario Canada corporation
(“Henvil”),
and
▇▇▇▇▇
▇▇▇▇▇▇,
its
sole shareholder and principal, (collectively “Consultants”)
as
parties of the first part,
and
Bovie
Medical Corporation,
organized and existing under the laws of the State of Delaware (“Bovie”),
as
party of the second part.
1. Definitions.
1.1 Disclosing
Party and Receiving Party.
As used
in this Agreement, the party disclosing Confidential Information (as defined
below) is referred to as the “Disclosing
Party”;
the
party receiving such Confidential Information is referred to as the “Receiving
Party”.
Each of
the Consultants and Bovie may be both a Disclosing Party and Receiving Party
depending upon the declaration of disclosure of Confidential Information.
1.2 Confidential
Information.
As used
in this Agreement, the term “Confidential
Information”
shall
mean all information about either party’s business, business plans, customers,
strategies, trade secrets, operations, records, finances, assets, technology,
data and information that reveals the processes, methodologies, technology
or
know how by which either party’s existing or future products, services,
applications and methods of operation are developed, conducted or operated
and
other confidential or proprietary information designated as such in writing
by
the Disclosing Party, whether by letter or by the use of an appropriate
proprietary stamp or legend, prior to or at the time any such trade secret
or
confidential or proprietary information is disclosed by the Disclosing Party
to
the Receiving Party or is orally or visually disclosed to the Receiving Party
by
the Disclosing Party. Information which is orally or visually disclosed to
the
Receiving Party by the Disclosing Party, or is disclosed in writing without
an
appropriate letter, proprietary stamp or legend, shall constitute Confidential
Information if (i) it would be apparent to a reasonable person, familiar
with
the Disclosing Party’s business and the industry in which it operates, that such
information is of a confidential or proprietary nature the maintenance of
which
is important to the Disclosing Party or if (ii) the Disclosing Party, within
thirty (30) days after such disclosure, delivers to the Receiving Party a
written document or documents describing such information and referencing
the
place and date of such oral, visual or written disclosure and the names of
the
employees or officers of the Receiving Party to whom such disclosure was
made.
2. Disclosure
of Confidential Information.
The
Receiving Party shall hold in confidence, and shall not disclose (or permit
or
suffer its personnel to disclose) to any person
outside its organization, any Confidential Information. The Receiving Party
and
its personnel shall use such Confidential Information only for the purpose
for
which it was disclosed and shall not use or exploit such Confidential
Information for its own benefit or the benefit of another without the prior
written consent of the Disclosing Party. Without limitation of the foregoing,
the Receiving Party shall disclose Confidential Information only to persons
within its organization who have a need to know such Confidential Information
in
the course of the performance of their duties and who are bound by a written
agreement possessing terms at least as restrictive as this agreement,
enforceable by the Disclosing Party, to protect the confidentiality of such
Confidential Information. The Receiving Party shall adopt and maintain programs
and procedures that are reasonably calculated to protect the confidentiality
of
Confidential Information and shall be responsible to the Disclosing Party
for
any disclosure or misuse of Confidential Information, which results from
a
failure to comply with this provision. The Receiving Party shall be fully
responsible for any breach of this Agreement by its agents, representatives
and
employees. The Receiving Party will promptly report to the Disclosing Party
any
actual or suspected violation of the terms of this Agreement and will take
all
reasonable further steps requested by the Disclosing Party to prevent, control
or remedy any such violation.
3. Limitation
on Obligations.
The
obligations of the Receiving Party specified in Section 2 above shall not
apply,
and the Receiving Party shall have no further obligations, with respect to
any
Confidential Information to the extent Receiving Party can demonstrate, by
clear
and convincing evidence, that such Confidential Information: (a) was generally
known to the public at the time of disclosure or has become generally known
through no breach of an agreement with or a duty owed to the Disclosing Party;
(b) was in the Receiving Party’s possession at the time of disclosure other than
as a result of Receiving Party’s breach of any legal obligation; (c) becomes
known to the Receiving Party through disclosure by sources other than the
Disclosing Party having the legal right to disclose such Confidential
Information; or (d) is independently developed by the Receiving Party without
reference to or reliance upon the Confidential Information. In the event
of a
disputed disclosure, the Receiving Party shall bear the burden of proof of
demonstrating that the information falls under one of the above exceptions.
Receiving Party may disclose Confidential Information if and to the extent
required by applicable laws, governmental or regulatory regulations, or proper
legal or governmental authority; provided that the Receiving Party provides
prior written notice of such disclosure to the Disclosing Party and Receiving
Party takes reasonable and lawful actions to avoid and/or minimize the extent
of
such disclosure.
4. Return
of Documents.
The
Receiving Party shall, upon the termination or expiration of this Agreement
or
the written request of the Disclosing Party, return to the Disclosing Party
all
drawings, documents, and other tangible manifestations of Confidential
Information received by the Receiving Party pursuant to this Agreement (and
all
copies and reproductions thereof).
5. Term
and Termination.
Each
Party has a right to terminate this Agreement upon written notice to the
other
Party. Nowithstanding any such termination, the provisions of this Agreement
shall survive with respect to the parties’ obligations concerning
confidentiality of the respective item of the Confidential Information until
the
earlier of: (i) the expiration of the Disclosing Party’s ownership rights in
this respective item of Confidential Information; (ii) the occurrence of
any of
the events set forth in (a) through (d) of paragraph 3, or (iii) a period
of
five (5) years from the effective date of this Agreement.
6. Miscellaneous.
This
Agreement (a) supersedes all prior agreements, written or oral, Bovie and
Consultants relating to the subject matter of this Agreement, (b) may not
be
modified, amended or discharged, in whole or in part, except by an agreement
in
writing signed by the parties hereto, (c) will be binding upon and inure
to the
benefit of the parties hereto and their respective heirs, successors and
assigns, and (d) shall be construed and interpreted in accordance with the
laws
of the State of New York. The provisions of this Agreement are necessary
for the
protection of the business and goodwill of the Disclosing Party and are
considered by the Receiving Party to be reasonable for such purpose. The
Receiving Party agrees that any breach of this Agreement will cause the
Disclosing Party substantial and irreparable damages and, therefore, in the
event of any such breach, in addition to other remedies that may be available,
the Disclosing Party shall have the right to seek specific performance and
other
injunctive and equitable relief.
IN
WITNESS WHEREOF, the
parties set their hands and seals hereto, on the date first
written.
|
BOVIE
MEDICAL CORPORATION
|
HENVIL
CORP.
|
|
By:
|
By:
|
|
▇▇▇▇▇
Citronowicz, Vice President
|
▇▇▇▇▇
▇▇▇▇▇▇, CEO
|
|
▇▇▇▇▇
▇▇▇▇▇▇, Individually
|
EXHIBIT
F:
Letter
regarding Intellectual Property from ▇▇▇▇▇▇ & ▇▇▇▇▇▇ Attorneys dated
November 22, 2005