EXHIBIT 10.1 


RESTRUCTURING AGREEMENT

AND AMENDMENT TO TRANSACTION DOCUMENTS


          This
RESTRUCTURING AGREEMENT AND AMENDMENT TO TRANSACTION DOCUMENTS (the
“Agreement”) is entered into as of the 28th day of June, 2013, by and among
Medtronic, Inc., a Minnesota corporation (“Medtronic”), Medtronic VidaMed,
Inc., a Delaware corporation and wholly-owned subsidiary of Medtronic
(“VidaMed”), and Urologix, Inc., a Minnesota corporation (“Urologix”).
Medtronic, VidaMed and Urologix may each be referred to in this Agreement
individually as a “Party” and collectively as the “Parties.”


RECITALS


          A. Prior to
September 6, 2011, Medtronic and VidaMed were in the business of manufacturing,
marketing and distributing (the “Prostiva Business”) a minimally-invasive
radio-frequency treatment for symptomatic benign prostatic hyperplasia (the
“Prostiva RF Therapy System”). 


          B. To
facilitate the transfer of the Prostiva Business to Urologix and the potential
acquisition of VidaMed by Urologix, the Parties entered into the following
agreements each dated as of September 6, 2011: 


	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 1.

 	
 License Agreement (the “License Agreement”) pursuant to which
 Medtronic and VidaMed, among other things, granted to Urologix an exclusive
 license under Medtronic’s and VidaMed’s intellectual property relating to the
 Prostiva RF Therapy System;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 2.

 	
 Transition Services and Supply Agreement (the “TSSA”) pursuant to
 which Medtronic agreed, among other things, to be Urologix’s interim
 distributor of certain products and components relating to the Prostiva RF
 Therapy System and to assist Urologix with the orderly transition of the
 Prostiva Business;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 3.

 	
 Acquisition Option Agreement (the “Option Agreement”) pursuant to
 which Medtronic granted Urologix the option to purchase certain assets
 relating to the Prostiva Business and Urologix granted Medtronic the right to
 require Urologix to purchase certain assets as more specifically described
 therein; and 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 4.

 	
 Asset Purchase Agreement pursuant to which Urologix purchased from
 Medtronic certain tangible assets used in the Prostiva Business (the
 “Purchase Agreement,” and with the License Agreement, TSSA and Option
 Agreement, each is referred to as a “Transaction Document” and collectively,
 the “Transaction Documents”).

 


          C. Under
the TSSA, Medtronic sold and delivered inventory to Urologix for use in the
Prostiva Business as evidenced by the invoices described on Schedule A attached
hereto (the 





“Outstanding Invoices”). As of the date hereof, the aggregate amount of
outstanding accounts payable owing to Medtronic for the Outstanding Invoices is
$5,332,537.72 (the “Outstanding Payable Amount”). 


          D. The
Parties desire to enter into this Agreement to set forth certain covenants,
terms and conditions relating to settlement of the Outstanding Payable Amount
and to amend certain terms of the Transaction Documents. 


          NOW
THEREFORE, in consideration of the foregoing and for
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged by each party, the parties hereto agree as follows:


           1. Satisfaction of Outstanding Payable Amount;
 Remaining Inventory Amount.  In consideration of the execution and delivery of a promissory note
 by Urologix in favor of Medtronic in the form attached hereto as Exhibit A
 (the “Note”) in the original principal amount of the sum of the Outstanding
 Payable Amount ($5,332,537.72) and other terms and conditions set forth in
 this Agreement, Medtronic acknowledges and agrees that the Outstanding Payable
 Amount shall be discharged and satisfied in full and Urologix shall have no
 further obligation in respect thereof or under the Outstanding Invoices. 


           2. Board Observation Rights; Management
 Updates. For so long as any obligations under the
 Note remain outstanding, Medtronic shall have the right to designate a
 representative of Medtronic as a board observer (the “Board Observer”) to
 attend all meetings of the Board of Directors of Urologix (the “Board”).
 Medtronic shall designate the Board Observer in writing to Urologix. The
 Board Observer will (1) receive copies of all notices and written information
 as furnished to the Board, (2) be permitted to be present at all meetings of
 the Board (whether by phone or in person), (3) shall not have the right to
 vote as a director or with the Board on any matter and (4) not be entitled to
 notices of, to receive information relating to, or to attend any meeting of
 any committee of the Board unless such notices or information are furnished
 to the non-committee members of the Board. Notwithstanding the foregoing, (i)
 Urologix shall be entitled to withhold any information and exclude the Board
 Observer from any meeting, or any portion thereof, (A) that is an executive
 session of the Board (consisting solely of independent directors and
 Urologix’s advisors); (B) if in the good faith determination of the Board,
 access to such information or attendance at such meeting would adversely
 affect the attorney-client privilege between Urologix and its counsel; or (C)
 that relates to matters as to which Urologix reasonably determines that
 Medtronic or the Board Observer or their respective affiliates, have or may
 likely have a conflict of interest, including, without limitation,
 discussions relating to any agreement between Urologix and Medtronic or the
 Board Observer or their respective affiliates, (ii) the Board Observer shall
 execute a confidentiality agreement in form and substance reasonably
 acceptable to Urologix with respect to all information and discussions to
 which the Board Observer will have access and (iii) the Board Observer shall
 agree to abide by the terms of the Urologix insider trading policy as if the
 Board Observer were a director. The Board Observer position will be an unpaid
 position and all travel expenses of the Board Observer shall be paid by
 Medtronic. Additionally, for so long as any obligations under the Note remain
 outstanding, Medtronic shall have the right to require at least once per
 quarter that management of Urologix provide Medtronic with a summary update
 of operations and performance of the 


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Prostiva Business. Medtronic agrees that such summary update is
confidential information of Urologix and Medtronic may not disclose such
information to any third party or use the information other than for monitoring
purposes without the written consent of Urologix. 


           3. Amendment to License Agreement. The
 Parties agree that the License Agreement shall be amended pursuant to the
 Amendment to License Agreement, in the form attached hereto as Exhibit B (the
 “License Agreement Amendment”). 


           4. Amendment to TSSA.
 Medtronic and Urologix agree that the TSSA shall be amended pursuant to the
 Amendment to Transition Services and Supply Agreement, in the form attached
 hereto as Exhibit C (the “TSSA Amendment”). 


           5. Conditions; Closing.
 The Parties agree that each of the following shall have occurred prior to, or
 shall occur contemporaneous with, the closing of the transactions
 contemplated by this Agreement: 


                    a. Urologix
shall pay to Medtronic in immediately available funds via wire transfer an
amount equal to $1,965,975, which amount shall constitute payment in full of
the following outstanding fees owing to Medtronic under the Transaction
Documents: (i) $775,725 owing under the outstanding TSSA invoices described on
Schedule B; (ii) $509,000 owing as the Earned Royalties under the License
Agreement as of September 6, 2012; (iii) $353,000 owing as the License Fee
under the License Agreement as of September 6, 2012; (iv) $147,000 owing as the
Purchase Price under the Purchase Agreement; (v) $63,750 owing as Monthly Fees
under the TSSA; (v) $52,500 as consideration for fifteen (15) generators (the
“Generators”); and (vii) $65,000 owing as the License Maintenance Fee under the
License Agreement as of September 6, 2012;


                    b. Urologix shall reimburse Medtronic for its fees and expenses of outside
counsel, a one-page summary of which shall be provided to Urologix, as required
pursuant to Section 9 below;


                    c. Urologix
shall execute and deliver to Medtronic the Note;


                    d. The
Parties shall duly execute and deliver to such other parties the License
Agreement Amendment;


                    e. Medtronic
and Urologix shall duly execute and deliver to each other the TSSA Amendment;


                    f. Medtronic
and Urologix shall duly execute and deliver to each other the Security
Agreement, substantially in the form attached hereto as Exhibit D (the
“Security Agreement”);


                    g. Medtronic shall enter into a subordination agreement with Silicon Valley Bank
(“SVB”), in form satisfactory to Medtronic;


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                    h.
All actions necessary to effect the US Regulatory Transfer (as such term is
defined in the TSSA) shall have been completed in all respects, except only
with respect to certain actions that Medtronic has agreed to with Urologix in
support of the Class 2 Recall Number Z-1031-2013;


                    i. Medtronic
shall have delivered the Generators to Urologix; and 


                    j. The
representations and warranties of the Parties contained herein shall be true
and correct in all material respects. 


          The Parties
hereto agree and acknowledge that the closing of the transactions contemplated
by this Agreement (the “Closing”) shall occur no later than the third day
immediately following the initial date that all conditions set forth in this
Section 5 have occurred, or such later date as mutually agreed to by all of the
Parties. 


           6. Representations
and Warranties. Urologix hereby represents and warrants to Medtronic as follows:


                    a. Incorporation, Corporate Power; Authorization.
Urologix is a duly incorporated and validly existing corporation and in good
standing under the laws of the State of Minnesota and has all requisite
corporate power and corporate authority for the ownership and operations of its
properties and for the carrying on of its business as now conducted. Urologix
is duly qualified and is in good standing as a foreign corporation and
authorized to do business in all jurisdictions wherein the character of the
property owned or leased, or the nature of the activities conducted by it,
makes such qualification or authorization necessary except where failure to be so
qualified does not have, or, is not reasonably expected to have a material
adverse effect (tangible or intangible) on its business, assets, liabilities or
financial condition (a “Material Adverse Effect”). Urologix has the corporate
power, and has been duly authorized by all requisite corporate action, to
execute and deliver this Agreement and each other agreement, document or
instrument contemplated hereby (the “Ancillary Agreements”), and to perform its
obligations hereunder or thereunder. 


                    b. Authorization. The execution and delivery
by Urologix of the Agreement and the Ancillary Agreements and the performance
by Urologix of its obligations hereunder and thereunder have been duly
authorized by all requisite corporate action. The execution, delivery, and
performance of this Agreement and each of the Ancillary Agreements do not and
will not (i) violate any law, rule, regulation, or court order to which
Urologix is subject; (ii) assuming consent is received from SVB, conflict with
or result in a breach of Urologix’s Articles of Incorporation or Bylaws or any
material agreement or instrument to which Urologix is a party or by which any
of its properties are bound, or (iii) result in the creation or imposition of
any lien, security interest, or encumbrance on any property of Urologix,
whether now owned or hereafter acquired, other than liens in favor of Medtronic
granted under the Security Agreement. 


                    c. Validity. The Agreement and each of the
Ancillary Agreements have each been duly executed and delivered by Urologix and
constitute the legal, valid and binding 


4






obligations of Urologix, enforceable in accordance with their
respective terms except as limited by applicable bankruptcy, insolvency,
reorganization, moratorium, other laws of general application affecting
enforcement of creditors’ rights generally, and as limited by laws relating to
the availability of specific performance, injunctive relief or other equitable
remedies. 


                    d.
Governmental Consents. No material
consent, approval, order or authorization of, or registration, qualification,
designation, declaration or filing with, any court, arbitrational tribunal,
administrative agency or commission or other governmental or regulatory
authority or agency (each of the foregoing is hereafter referred to as a
“Governmental Entity”) is required on the part of Urologix in connection with
the execution and delivery of this Agreement or the Ancillary Agreements, the
offer, issuance, sale and delivery of the Note or the other transactions to be
consummated at the Closing and such filings required to be made after the
Closing under applicable federal and state securities laws and the filing of
UCC-1 financing statements by Medtronic in the applicable jurisdictions
covering the Collateral (as that term is defined in the Security Agreement),
all of which filings have or will be made in a timely manner. 


                    e. Litigation. There is no action, suit or
proceeding, or governmental inquiry or investigation, pending, or, to
Urologix’s knowledge, any threat thereof, against Urologix that (i) questions
the validity of this Agreement, the Ancillary Agreements or the right of
Urologix to enter into or to consummate the transactions contemplated by such
agreements, or (ii) to Urologix’s knowledge, would reasonably be expected to
have, either individually or in the aggregate, a Material Adverse Effect. 


                    f.
Financial Statements. Urologix’s
audited financial statements as of June 30, 2012 (including balance sheet,
income statement and statement of cash flows) and its unaudited balance sheet
and statement of operations as of and for the three month period ended March
31, 2013 (collectively, the “Financial Statements”), have been prepared in accordance
with generally accepted accounting principles (“GAAP”) applied on a consistent
basis throughout the periods indicated, except that the unaudited Financial
Statements may not contain all footnotes required by GAAP and are subject to
normal year-end adjustments. The audited Financial Statements and, to the best
of Urologix’s knowledge, the unaudited Financial Statements fairly present in
all material respects the financial condition and operating results of Urologix
as of the dates, and for the periods, indicated therein. Urologix has no
material liabilities or obligations, contingent or otherwise, other than (i)
liabilities incurred in the ordinary course of business (ii) obligations under
contracts and commitments incurred in the ordinary course of business and (iii)
liabilities and obligations of a type or nature not required under GAAP to be
reflected in the Financial Statements, which, in all such cases, individually
and in the aggregate, would not have a Material Adverse Effect. 


                    g. Taxes. Urologix has timely filed or
obtained presently effective extensions with respect to all Tax Returns (as
defined below) that are or were required to be filed by it, such Tax Returns
are complete and accurate in all material respects and all Taxes (as defined
below) shown thereon to be due have been timely paid. All Taxes (as defined
below) that Urologix is or was required by law to have withheld or collected
have been duly withheld or collected and, to the extent required, have been
timely paid to the proper Governmental Entity except where failure to withhold,
collect or pay is likely not to have a Material Adverse Effect. 


5





The Tax Returns of Urologix have not been audited by any Governmental
Entity, and no controversy with respect to Taxes is pending or, to the
knowledge of Urologix, threatened. For purposes of this Agreement: (i) “Tax” or
“Taxes” means all taxes, charges, fees, levies or other similar assessments or
liabilities, including, without limitation, income, gross receipts, ad valorem,
premium, value-added, excise, real property, personal property, sales, use,
transfer, withholding, employment, unemployment insurance, social security,
business license, business organization, environmental, worker compensation,
payroll, profits, license, lease, service, service use, severance, stamp,
occupation, windfall profits, customs, duties, franchise and other taxes
imposed by the United States of America or any state, local or foreign
government, or any other Governmental Entity (and of which, Urologix has actual
knowledge or notice), and any interest, fines, penalties, assessments or
additions to tax resulting from, attributing to or incurred in connection with
any tax or any contest or dispute thereof; and (ii) “Tax Return” means all
reports, returns, declarations, statements or other information required to be
supplied to a taxing authority in connection with Taxes and any amendment
thereof. 


                    h.
Property and Assets. Urologix has
good title to, or, to Urologix’s knowledge, a valid leasehold interest in, all
of its properties and assets, including all properties and assets reflected in
the unaudited balance sheet of Urologix as of March 31, 2013, and none of such
properties or assets is subject to any mortgage, pledge, security interest,
burden, encumbrance or other lien (whether arising by contract or, to
Urologix’s knowledge, by operation of law) (a “Security Interest”) other than
(i) the security interest granted to SVB, (ii) liens for Taxes not yet due and
payable or being contested in good faith in appropriate proceedings and for
which aggregate reserves have been set aside, (iii) liens approved in writing
by Medtronic, (iv) liens upon any equipment or other personal property acquired
by Urologix to secure (a) the purchase price of such equipment or other
personal property or (b) lease obligations or indebtedness incurred solely for
the purpose of financing the acquisition of such equipment or other personal
property; provided that such liens described in the clause (iv) (1) are
confined solely to the equipment or other personal property so acquired and the
amount secured does not exceed the acquisition price thereof and (2) do not
secure more than Two Hundred Thousand Dollars ($200,000) in the aggregate
amount outstanding, (v) liens of carriers, warehousemen, suppliers or other
persons that are possessory in nature arising in the ordinary course of
business so long as such liens attach only to inventory and which are not
delinquent or remain payable without penalty or which are being contested in
good faith and by appropriate proceedings which proceedings have the effect of
preventing the forfeiture or sale of the property subject thereto, (vi) liens
to secure payment of workers’ compensation, employment insurance, old-age pensions,
social security and other like obligations incurred in the ordinary course of
business (other than liens imposed by ERISA), (vii) liens incurred in the
extension, renewal or refinancing of the indebtedness secured by liens
described in clauses (i) through (iv) above, but any extension, renewal or
replacement lien must be limited to the property encumbered by the existing
lien and the principal amount of the indebtedness may not increase; (viii)
non-exclusive licenses of intellectual property or exclusive license of
non-material intellectual property granted to third parties in the ordinary
course of business; and (ix) liens in favor of other financial institutions
securing the customary fees and expenses of such institutions arising in
connection with Urologix’s deposit accounts or investment accounts held at such
institutions (collectively, “Permitted Liens”). 


6







                    i.
Compliance. To Urologix’s knowledge, Urologix has
complied with all laws, regulations and orders applicable to its present
business and has all permits and licenses required thereby except where failure
to comply, or have such permits or licenses, has not had, or reasonably not
likely to have, a Material Adverse Effect. 


                    j.
Absence of Changes. Since March 31, 2013, except in respect of the
transactions contemplated by this Agreement, the Ancillary Agreements and the
Transactions Documents, there has not been:



                              A.
any change in assets, liabilities, financial condition or operating results
of Urologix from that reflected in the Financial Statements, except changes in
the ordinary course of business or changes that have not caused, in the
aggregate, a Material Adverse Effect;


                              B.
any damage, destruction or loss, whether or not covered by insurance, that
would have a Material Adverse Effect;


                              C.
any satisfaction or discharge of any lien, claim, or encumbrance or payment of
any obligation by Urologix, except in the ordinary course of business or the
satisfaction or discharge of which would not have a Material Adverse Effect;


                              D.
any mortgage, pledge, transfer of a security interest in, or lien, created by
Urologix, with respect to any of its material properties or assets, except for
Permitted Liens;


                              E.
any declaration, setting aside or payment or other distribution in respect of
any of Urologix’s capital stock, or any direct or indirect redemption,
purchase, or other acquisition of any of such stock by Urologix;


                              F.
to Urologix’s knowledge, any other event or condition of any character (other
than events affecting the economy or Urologix’s industry generally) that would
reasonably be expected to result in a Material Adverse Effect. 


                              G.
any arrangement or commitment by Urologix to do any of the things described in
this subsection (j). 


                    k.
Insurance.
Urologix has in full force and effect fire and casualty
insurance policies and insurance against other hazards, risks, and liabilities
to persons and property to the extent and in the manner reasonable for
similarly situated companies in similar businesses. 


                    l.
Indebtedness of Other Persons. Except as set forth in the
Financial Statements, Urologix has not assumed, guaranteed, endorsed or
otherwise become directly or contingently liable for any indebtedness of any
other person (including, without limitation, liability by way of agreement,
contingent or otherwise, to purchase, to provide funds for payment, to supply
funds to or otherwise invest in the debtor, or otherwise to assure the creditor



7





 against loss), except for
guaranties by endorsement of negotiable instruments for deposit or collection
in the ordinary course of business. 


                    m.
Transactions with Affiliates. There are no loans, leases or
royalty agreements between Urologix and (i) any of the officers or directors of
Urologix, (ii) any person owning five percent (5%) or more of any class of
capital stock of Urologix or other entity controlled by any such person or a
member of any such person’s family, or (iii) any other person otherwise
controlling, controlled by or under common control with Urologix. 


          7. Covenants.
Urologix hereby agrees and covenants that for so long as any amounts
remain outstanding under the Note: 


                    a.
Conduct Business in Ordinary Course. Urologix
shall conduct its operations and business in the ordinary course of business. 


                    b.
Corporate Existence; Compliance with Laws and
Contractual Obligations; Records and Books.
Urologix shall maintain its corporate existence, rights and
franchises in full force and effect.
Urologix shall comply with all applicable laws, rules regulations and
orders as well as contractual obligations to which it is subject, except where
failure to so comply does not have a Material Adverse Effect. Urologix shall keep adequate records and
books of account, in which entries will be made in accordance with GAAP
consistently applied, reflecting all financial transactions of Urologix
required to be reflected by GAAP, and in which, for each fiscal year, all
proper reserves for depreciation, depletion, obsolescence, amortization, taxes,
bad debts and other purposes required to be made by GAAP in connection with its
business shall be made and will keep full and complete financial records
consistent with past practice. 


                    c.
Payment of Taxes. Urologix shall pay and discharge when due
all material taxes, assessments and governmental charges or levies imposed upon
it or upon its income or profits, or upon any properties belonging to it, prior
to the date on which interest or penalties attach thereto, and all lawful
claims which, if not paid when due, might become a lien or charge upon any
properties of Urologix that is other than a Permitted Lien, provided that
Urologix shall not be required to pay any such tax, assessment, charge, levy or
claim which is being contested in good faith and by proper proceedings if
Urologix shall have set aside on its books adequate reserves with respect
thereto. 


                    d.
Inspection; Information. Upon an Event of Default (as defined in the
Note), Urologix shall: (i) permit Medtronic and its authorized employees,
agents, accountants, legal counsel, lenders and other representatives to have
reasonable access to the books and records, officers and accountants of
Urologix at all times reasonably requested by Medtronic during normal Urologix
business hours solely for the purpose of conducting an investigation of the assets,
liabilities, financial condition, corporate status, operations, business and
properties of Urologix and its subsidiaries (collectively, “Operations
Collateral” (as that term is defined in the Security Agreement); and (ii) make
available to Medtronic for examination and reproduction all documents and data
of every kind and character relating to the Collateral in possession or control
of, or subject to reasonable access by, Urologix, including, without
limitation, all files, records, 


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data and information relating to the Collateral (whether stored in
paper, magnetic or other storage media) and all agreements, instruments,
contracts, assignments, certificates, orders, and amendments thereto. 


          Medtronic
agrees to use the same degree of care that it uses to protect its own
confidential information to keep confidential any information famished to it by
Urologix which Urologix identifies as being confidential or proprietary (so
long as such information is not in the public domain through no fault of the
Investor), except that Medtronic may disclose such confidential or proprietary
information to any representative of Medtronic for the purpose of evaluating
its rights under this Agreement and the Ancillary Agreements. 


                    e.
Notification of Changes. Urologix shall advise Medtronic of any
change or event having, or which would have, or would likely result in, a
Material Adverse Effect or which would cause or constitute a material breach of
any of the covenants of Urologix contained herein or in any of the Ancillary
Agreements. 


                    f.
Required Insurance Coverage. Urologix shall procure and maintain, as to
its properties and business, insurance issued by responsible insurance
companies against damage and loss by theft, fire, collision (in the case of
motor vehicles), public and product liability, larceny, embezzlement, other
criminal misappropriation and such other casualties and contingencies, and in
such amounts, as are usually carried by comparable companies similarly
situated, of similar size, scope and financial condition. 


                    g.
Maintenance of Properties. Urologix shall use its commercially
reasonable efforts to maintain in good repair, working order and condition,
reasonable wear and tear excepted, its properties and other assets and from
time to time make all necessary or desirable repairs, renewals and replacements
thereto. 


                    h.
Transactions with Affiliates. Urologix will not permit any of its
affiliates to engage in any material transaction of any kind or nature with
Urologix, other than (a) pursuant to the terms of any agreement existing as of
the date hereof between Urologix and any affiliate, (b) unless such
transaction, or in the case of a course of related or similar transactions or
continuing transactions, such course of transactions or continuing transactions
is or are approved by independent directors of Urolgoix or is or are upon terms
which are fair to Urologix and which are reasonably similar to, or more beneficial
to Urologix than, the terms deemed likely to be obtained in similar
transactions with unrelated Persons under the same circumstances, (c)
compensation arrangements approved by Urologix’s Board of Directors, and (d)
equity and bridge financings with Urologix’s existing investors provided that
any such indebtedness is unsecured subordinated debt to the indebtedness owed
by Urologix to Medtronic and does not violate subsection (i) below. 


                    i.
Limitation on Incurrence of Indebtedness or
Liens. Other than Permitted
Indebtedness, Urologix shall not, at any time, incur, create, assume or
guarantee, or otherwise become or be liable in any manner with respect to any
indebtedness for borrowed money without the prior written consent of Medtronic which
consent shall not be unreasonably withheld or delayed provided that the holder
of such indebtedness executes a subordination 


9






agreement upon terms reasonably acceptable to Medtronic. The term “Permitted Indebtedness” shall mean (i) Urologix’s indebtedness
to Medtronic under this Agreement and the Ancillary Agreements; (ii)
indebtedness existing on the date hereof as disclosed in Schedule 1 attached
hereto; (iii) indebtedness secured by liens permitted under clauses (i), (iii)
and (iv) of the definition of “Permitted Liens”; (iv) inter-company
indebtedness not to exceed One Hundred Thousand Dollars ($100,000) in the
aggregate in any fiscal year; (v) unsecured indebtedness under any corporate
credit card program in an amount not to exceed Four Hundred Thousand Dollars
($400,000) in the aggregate; (vi) other unsecured indebtedness in an aggregate
principal amount not to exceed One Hundred Thousand Dollars ($100,000); (vi)
extensions, refinancing, modifications, amendments and restatements of any items
of Permitted Indebtedness (i) through (v) above, provided that the principal
amount thereof is not increased or the terms thereof are not modified to impose
more burdensome or less favorable terms upon Urologix or its subsidiaries, as
the case may be; and (vii) indebtedness under that certain Loan and Security
Agreement dated as of January 11, 2012, by and between Urologix and SVB (as the
same may from time to time be amended, modified, supplemented or restated and
including any renewal, extension or refinancing thereof with substantially the
same terms in all material respects, up to the capped amount set forth in
Section 2 of the Subordination Agreement between Holder and Silicon Valley
Bank, dated June 28, 2013. Other than
Permitted Liens, so long as the Note is outstanding, Urologix will not create,
incur, assume or permit to exist any lien, charge or other encumbrance on any
of its assets except liens incurred hereunder, without the prior written
consent of Medtronic which consent shall not be unreasonably withheld or
delayed. Notwithstanding anything to
the contrary contained herein, in no event shall this Section 7(i) restrict or
otherwise limit Urologix from incurring any amount of accounts payable in the
ordinary course of business, accrued payroll or any employee benefits or
compensation amounts that may accrue from time to time in the ordinary course
of business. 


                    j.
No Designation of Other Debt or Liens as
Senior. Except as permitted
by Section 7(i)(vii) above or by the Note, Urologix shall not make any
prepayment of principal, premium or interest on any debt (A) which would
violate the terms of this Agreement, or (B) that is unsecured debt or is pari
passu with or subordinated to the debt owed by Urologix to Medtronic. Urologix shall not make any deposit
(including the payment of amounts into a sinking fund or other similar fund)
for the foregoing purpose or attempt to defease such subordinated debt. Except as permitted by Section 7(i)(vii)
above or by the Note, Urologix shall not designate any indebtedness incurred
subsequent to the date of this Agreement as senior or pari passu to the debt
owed by Urologix to Medtronic pursuant to this Agreement. Except as permitted by the Security
Agreement, Urologix shall not designate any lien on any of the assets of
Urologix subsequent to the date of this Agreement as senior to the security
interest made by Urologix in favor of Medtronic pursuant to this Agreement. 


          8. Generators. Medtronic represents to Urologix that the Generators are new and
in saleable condition. 


          9. Attorneys’ Fees. Urologix agrees to reimburse Medtronic the first $25,000 of its
fees and expenses of outside legal counsel, a one-page summary of which shall
be provided to Urologix, incurred in connection with the negotiation,
preparation and execution of this Agreement and all agreements, documents and
transactions contemplated hereby and fifty 


10





percent (50%) of such fees and costs that exceed $25,000; provided,
however, that in no event shall Urologix be obligated to reimburse Medtronic
for such fees and costs in an amount that exceeds $50,000. Medtronic hereby acknowledges that payment
of Stoel Rives LLP legal fees by Urologix may raise a potential conflict of
interest and hereby consents to the payment arrangement set forth herein. 


          10. Notices.
All notices, requests, demands and other communications under this
Agreement and the Ancillary Agreements shall be in writing and shall be deemed
to have been duly given (i) on the date of service if served personally on the
party to whom notice is to be given; (ii) on the next business day after
delivery to Federal Express or similar overnight courier for next day delivery;
or (iii) on the third (3rd) business day after mailing, if mailed to the party
to whom notice is to be given, by first class mail, registered or certified,
postage prepaid and properly addressed, to the party as follows: 


	
  

 	
  

 
	
  

 	
 If to Medtronic:

 
	
  

 	
  

 
	
  

 	
 Medtronic, Inc.

 
	
  

 	
 710 Medtronic Parkway NE

 
	
  

 	
 Minneapolis, MN 55432-5604

 
	
  

 	
  

 
	
  

 	
 With separate copies thereof addressed to:

 
	
  

 	
  

 
	
  

 	
 Attn: General Counsel

 
	
  

 	
 Mail Stop LC400

 
	
  

 	
 and

 
	
  

 	
 Attn: Vice President of Corporate
 Development

 
	
  

 	
 Mail Stop LC270

 
	
  

 	
  

 
	
  

 	
 And with copy to:

 
	
  

 	
  

 
	
  

 	
 Stoel Rives LLP

 
	
  

 	
 33 South Sixth Street, Suite 4200

 
	
  

 	
 Minneapolis, MN 55402

 
	
  

 	
 Attn: Robert A. Kukuljan

 
	
  

 	
  

 
	
  

 	
 If to Urologix:

 
	
  

 	
  

 
	
  

 	
 Urologix, Inc.

 
	
  

 	
 14405 21st Avenue North

 
	
  

 	
 Minneapolis, MN 55447

 
	
  

 	
 Attn: Greg Fluet, CEO

 
	
  

 	
  

 


11









	
  

 	
  

 
	
  

 	
 With copy to:

 
	
  

 	
  

 
	
  

 	
 Lindquist & Vennum LLP

 
	
  

 	
 4200 IDS Center

 
	
  

 	
 80 South Eighth Street

 
	
  

 	
 Minneapolis, MN 55402

 
	
  

 	
 Attn: Charles P. Moorse

 



Any party may change its address for the purposes of this Agreement by
giving notice of such change of address to the other parties in the manner
herein provided for giving notice. 


          11. Effect of Amendment. Except as specifically otherwise agreed to
herein, the Parties acknowledge and agree that the terms of the Ancillary
Agreements remain unchanged and in full force and effect, and are hereby
reaffirmed and restated effective as of the date hereof as if fully set forth
herein. 


          12. Governing Law; Jurisdiction. This Agreement will be governed, construed,
and interpreted in all respects in accordance with the laws of the State of
Minnesota without regard to provisions regarding the conflict of laws. Each party hereto irrevocably submits to the
exclusive jurisdiction of the state or federal courts located in the State of
Minnesota, and hereby irrevocably waives, and agrees not to assert in any suit,
action or proceeding, any claim that it is not personally subject to the
jurisdiction of any such court, that the venue thereof may not be appropriate,
that such suit, action or proceeding is improper or that this Agreement or any
of the documents referred to in this Agreement (including the Ancillary
Agreements) may not be enforced in or by such courts, and each party hereto
irrevocably agrees that all claims with respect to such suit, action or
proceeding shall be heard and determined in such Minnesota state or federal
court. Each party hereby irrevocably
waives personal service of process and consents to process being served in any
such suit, action or proceeding by mailing a copy thereof to such party in the
manner provided in Section 10 and agrees that such service shall constitute
good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to
limit in any way any right to serve process in any manner permitted by law. 


          13. Waiver of Jury Trial. To the fullest extent permitted by
applicable law, each of the parties hereto hereby knowingly, voluntarily and
intentionally waives its respective rights to a jury trial of any claim or
cause of action based upon or arising out of this Agreement or the Ancillary
Agreements or any dealings between them relating to the subject matter of this
Agreement or the Ancillary Agreements.
Each party hereto (a) certifies that none of their respective
representatives, agents or attorneys has represented, expressly or otherwise,
that such party would not, in the event of litigation, seek to enforce the
foregoing waivers and (b) acknowledges that it has been induced to enter into
this Agreement and the Ancillary Agreements by, among other things, the mutual
waivers and certifications herein. 


          14. Advice of Counsel. Each of the Parties has obtained such
counsel as each deems appropriate before entering into this Agreement, and each
has independently determined to enter into this Agreement. 


12





          15. Entire Agreement. The Transaction Documents, this Agreement, and the Ancillary
Agreements (including, without limitation, any and all exhibits, schedules,
certificates, instruments and documents attached hereto or thereto or executed
expressly in connection herewith or therewith) represent the entire agreement
between the parties relative to the subject matter hereof which cannot be
modified except in writing signed by the Parties. 


          16. Severability. Whenever possible, each provision of this Agreement shall be
interpreted in such a manner as to be effective and valid under applicable
law. If, however, any provision of this
Agreement or any Ancillary Agreements shall be determined by a court of
competent jurisdiction to be invalid or unenforceable, such provisions shall be
ineffective to the extent of such invalidity or unenforceability, without
invalidating the remainder of such provision or the remaining provisions of
this Agreement or such applicable Ancillary Agreements, unless the remaining
provisions do not reflect the intent of the parties in entering into this
Agreement or such applicable Ancillary Agreements. 


          17. Public Announcements. Urologix shall not issue any press releases,
make any public announcement or statement without the consent of Medtronic,
except for announcements, filings, or registrations which may be required by
applicable law. 


          18. Parties in Interest. All representations,
covenants and agreements contained in this Agreement by or on behalf of any of
the parties hereto shall bind and inure to the benefit of the respective
successors and assigns of the parties hereto whether so expressed or not.
Without limiting the generality of the foregoing, all representations,
covenants and agreements benefiting Medtronic, unless otherwise herein or
therein provided, shall inure to the benefit of any and all subsequent holders
from time to time of the Note and all such holders shall be bound by all of the
obligations of Medtronic hereunder. 


          19. Headings. The bold-faced headings at the
beginning of each paragraph are for convenience only and are not intended to be
part of the substance of this Agreement; any perceived inconsistencies between
the heading and the text are to be governed exclusively by the text. 


          20. Survival of Representations and Warranties.
All representations and warranties made by each Party in this Agreement and
Ancillary Agreements or in any agreement, certificate or instrument delivered
pursuant to or in connection with this Agreement or the Ancillary Agreements
shall survive the execution and delivery of this Agreement and the closing of
the transactions contemplated hereby. 


          21. Counterparts. This Agreement may be
executed in counterparts, any of which may be executed and delivered via
facsimile or other electronic delivery, each of which shall be deemed an
original, and all of which, taken together, shall constitute one and the same
instrument. 


          22. Expenses. Except as expressly provided
herein, the Parties shall each pay their own expenses incident to this Agreement
and the documents executed and delivered in 


13





connection herewith and the preparation for, and consummation of, the
transactions provided for herein and therein.


          23. Acknowledgement. Urologix acknowledges that
the Outstanding Invoices represent amounts due and owing to Medtronic for
inventory purchased from Medtronic. Medtronic acknowledges that the Outstanding
Payable Amount represents the entire outstanding amount owed by Urologix for
inventory purchased from Medtronic prior to the date hereof. 


[The remainder of this page is intentionally left blank.] 


14







          IN
WITNESS WHEREOF, the parties hereto have caused this
Restructuring Agreement and Amendment to Transaction Documents to be executed
effective as of the date first above written. 


	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 MEDTRONIC,
 INC.

 	
  

 	
 UROLOGIX,
 INC.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 By:

 	
   /s/ Thomas M. Tefft

 	
  

 	
 By:

 	
   /s/ Greg Fluet

 
	
 Name:

 	
  Thomas M. Tefft

 	
  

 	
 Name:

 	
  Greg Fluet

 
	
 Title:

 	
  Senior Vice President & President,

 	
  

 	
 Title:

 	
  Chief Executive Officer

 
	
  

 	
  

 	
  Neuromodulation

 	
  

 	
  

 	
  

 	
  

 






	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 MEDTRONIC
 VIDAMED, INC.

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 By:

 	
   /s/ Thomas M. Tefft

 	
  

 	
  

 	
  

 	
  

 
	
 Name:

 	
  Thomas M. Tefft

 	
  

 	
  

 	
  

 	
  

 
	
 Title:

 	
  President

 	
  

 	
  

 	
  

 	
  

 






[Signature page to Restructuring Agreement and
 Amendment to Transaction Documents.]