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 Steve
Livneh, 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
 
 WHEREASLivneh 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 Bhereto (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”).
 
 WHEREASConsultants 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 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.
  4
  2.3           Stock
Options:  As
additional compensation for Steve Livneh, Bovie 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 AandB.
 
 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 Steve Livneh, as directed by
Henvil in writing .
 
 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.
  5
 
 3.2           Inventions
and Consultants’ Work Product  Proprietary to BovieConsultants
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
 
 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”).
  6
  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 grant Bovie 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.
 
 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 Howard & Howard 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.
  7
  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 Dattached hereto, which
is incorporated herein by reference.
 
 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.
  8
  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:
  (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.
  9
  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 Steve Livneh or Henvil, or assign their rights
hereunder to any other person or entity unless such entity is at least 50% owned
and controlled by Steve Livneh.  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:
 
 If
      to Bovie:
                    Name:
                    Bovie
      Medical Corp.Attention:
                    Moshe
      CitronowiczAddress:
                    7100
      30th
      Avenue NorthSt.
      Petersburg, FL 33710Fax:
                    (727)
      347-9144If
      to Consultants:
                    Name:
                    Henvil
      Corp.Steve
      LivnehAddress:
                    440
      Dalhousie St.Amhertsburg,
      OntarioCanada
      N9VIX3Fax:
                    (519)
      736-5779
 
 Each
party hereto shall promptly notify in writing, the other parties of any change
in the foregoing contact information.
  10
 
 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;
 
 (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.
  11
  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:
                  /S/ Moshe Citronowicz
                  
                  By:
                  /S/ Steve LivnehMoshe
      Citronowicz, Vice President
                  
                  
                  Steve
      Livneh, CEO





/S/ Steve LivnehSteve
      Livneh,
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 mm
blunt punch


2.7 mm
blunt punch


3.4 mm
scoop punch


2.7 mm
scoop punch


3.4 mm
grasper


3.4 mm
scissors





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





EXHIBIT
C





BOVIE-MF
PROJECT


PRELIMINARY EQUIPMENT
LIST


11-08-2005





ITEM#
                            
                            DESCRIPTION
                            
                            QUANT.
                            
                            COMMENTSMACHINES:1.
                            
                            20
      MM Multi-Axis, Double Spindle, Powered tools
                            
                            1
                            
                            NewSWISS
      LATHE.2.
                            
                            16
      MM multi-axis, double spindle, powered tools
                            
                            1
                            
                            NewSWISS
      LATHE3.
                            
                            HIGH
      SPEED VMC, INCL. REAL TIME 4TH
      AXIS INCLUDING
                            
                            1
                            
                            NEWTOOLING4.
                            
                            TOOLS
      ROOM CNC MILL INCLUDING TOOLING
                            
                            1
                            
                            NEW/USED5.
                            
                            TOOL
      ROOM LATHE
                            
                            1
                            
                            NEW/USED6.
                            
                            CENTERLESS
      GRINDER
                            
                            1
                            
                            NEW/USED7.
                            
                            SURFACE
      GRINDER, SEMI-AUTOMATIC
                            
                            1
                            
                            NEW/USED8.
                            
                            WIRE
      EDM SUBMERSIBLE
                            
                            1
                            
                            USED9.
                            
                            LASER
      WELDER, MANUAL, PLUS ROTARY/LINEAR
                            
                            1
                            
                            NEWFIXTURES10.
                            
                            DRILL
      PRESS
                            
                            1
                            
                            NEW11.
                            
                            MANUAL
      MILL (I.E. BRIDGPORT)
                            
                            1
                            
                            NEW/USEDQ.C.
      EQUIPMENT:1.
                            
                            COMPARATOR
      WITH FIXTURES
                            
                            2
                            
                            NEW/USED2.
                            
                            MICROSCOPE
      W/VIDEO CAMERA
                            
                            1
                            
                            NEW/USED3.
                            
                            GRANITE
      SURFACE PLATE + STAND
                            
                            1
                            
                            NEW/USED4.
                            
                            GAUGE
      PINS AND BLOCKS
                            
                            2
                            
                            NEW5.
                            
                            HEIGHT
      GAUGE
                            
                            1
                            
                            NEW








MISCELANEOUS:1.
                    
                    BUFFING
      MACHINE
                    
                    2
                    
                    NEW/USED2.
                    
                    TIG/MIG
      WELDER
                    
                    1
                    
                    NEW3.
                    
                    ULTRASONIC
      CLEANER
                    
                    1
                    
                    NEW/USED4.
                    
                    SAND
      BLASTER
                    
                    1
                    
                    NEW5.
                    
                    AIR
      COMPRESSOR 15-25 HP
                    
                    1
                    
                    NEW6.
                    
                    CITRIC
      ACID PASSIVATION STATION
                    
                    1
                    
                    NEW7.
                    
                    ELECTROPOLISH
      STATION
                    
                    1
                    
                    NEW





NOTE:





SOME
ALTERATION AND CHANGES MAY OCCUR, BASED ON EQUIPMENT AVAILAILABITY AT THE TIME
OF PURCHASE/LEASE.





EXHIBIT
D:





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 Steve Livneh, 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).
                  
                  __





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 Steve
Livneh, 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.


ii




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:
                  /S/ Moshe Citronowicz
                  
                  By:
                  /S/ Steve LivnehMoshe
      Citronowicz, Vice President
                  
                  Steve
      Livneh, CEO




Steve
      Livneh,
Individually


iii


EXHIBIT
F:





Letter
regarding Intellectual Property from Howard & Howard Attorneys dated
November 22, 2005