Document:

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Exhibit 10.1         Settlement Agreement, effective October 26, 2001, by,
                     between and among the Company, Arthur A. Beisang, Dr.
                     Robert A. Ersek, Arthur A. Beisang, III, M.D., Carbon
                     Medical Technologies, Inc., Brennen Medical, Inc. and
                     Timothy Lawin.

                              SETTLEMENT AGREEMENT

         Effective upon the date of last execution by a party, this Settlement
Agreement ("Agreement") is made by, between and among Uroplasty, Inc.
("Uroplasty"), Arthur A. Beisang ("Beisang"), Dr. Robert Ersek ("Ersek"), Arthur
A. Beisang III, M.D. ("Beisang III"), Carbon Medical Technologies, Inc.
(formerly known as Advanced UroScience, Inc. and referred to as "Carbon Medical"
herein), Brennen Medical, Inc. and Timothy Lawin, hereinafter sometimes
collectively referred to as the "Parties".

                                    RECITALS

         WHEREAS, Uroplasty filed a lawsuit entitled Uroplasty, Inc. v. Advanced
UroScience, Inc., Brennen Medical, Inc. and Timothy Lawin, in Ramsey County
District Court, Court File No. 62-C1-98-008574 (the "First Lawsuit"); and

         WHEREAS, the First Lawsuit was removed to the United States District
Court for the District of Minnesota, Case No. 98-CV-2082 and after proceedings
therein, and in the United States Court of Appeals for the Federal Circuit, was
remanded back to Ramsey County District Court, where it is now pending; and

         WHEREAS, Carbon Medical owns patent number 5,451,406 ("Carbon Medical's
 Patent"); and

         WHEREAS, in the First Lawsuit, Uroplasty alleged that Carbon Medical's
Patent derived from technology developed by Uroplasty, and that Carbon Medical,
Brennen Medical, Inc. and Timothy Lawin were liable for breach of contract,
breach of fiduciary duty, and violation of Minnesota's Trade Secret Act; and

         WHEREAS, Carbon Medical, Brennen Medical, Inc. and Timothy Lawin denied
Uroplasty's allegations and asserted counterclaims in the first Lawsuit; and

         WHEREAS, Carbon Medical filed a lawsuit entitled Advanced UroScience,
Inc. v. Arthur A. Beisang, in Ramsey County District, Court File No. CO-99-1626
(the "Second Lawsuit"); and

         WHEREAS, the Second Lawsuit was removed to United States District Court
for the District of Minnesota, Case No. 99-CV-294, where it is now pending; and

         WHEREAS, Uroplasty filed a 37 CFR 1.607 request with the United States
Patent and Trademark Office for an interference ("Interference") between Carbon
Medical's Patent and a September 18, 1996 patent application owned by Uroplasty
entitled "Treatment of Urological Disorders by Injection of Micro Particles"
("Uroplasty's Patent Application"); and

         WHEREAS, Ersek, Beisang and Beisang III are shareholders of Uroplasty
and have claimed intellectual property rights adverse to Carbon Medical, Brennen
Medical, Inc. and/or Lawin; and

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         WHEREAS, the Parties wish to have a complete and full settlement and
resolution of all claims and potential claims between them, including all issues
relating to the claims asserted or which could have been asserted or which could
be asserted in the future, in the First Lawsuit, the Interference, and the
Second Lawsuit; and

                     NOW THEREFORE, IT IS AGREED AS FOLLOWS:

1.  PAYMENT: In consideration of the terms and conditions of this Agreement,
Carbon Medical, Brennen Medical, Inc. and Timothy Lawin shall jointly pay the
sum of $400,000 to Uroplasty. $200,000 of this amount will be paid within ten
(10) business days after the effective date of this Agreement or ten (10)
business days after the filing of Uroplasty's written declaration of abandonment
of Uroplasty's Patent Application and withdrawal of its request for
Interference, whichever occurs later; $100,000 will be paid six (6) months after
the first payment; $100,000 will be paid twelve (12) months after the first
payment. Carbon Medical, Brennen Medical, Inc. and Timothy Lawin will pay simple
interest at the rate of 8% per annum on the deferred balances.

2.  RELEASE: Upon execution of this Agreement, and for good and valuable
consideration, except for those obligations created by this Agreement, the
Parties do hereby fully, finally and forever release each other and their
respective agents, representatives, employees, shareholders, officers,
directors, attorneys, successors or assigns, divisions, subsidiaries and related
companies, and insurance companies from any and all claims, lawsuits, causes of
action, administrative proceedings, including, without limitation, proceedings
in the United States Patent and Trademark Office, default notices, debts,
accounts receivable, purchase orders, invoices, contracts, duties, accounts,
charges, demands, judgments, representations and warranties of any nature
whatsoever which the Parties have, or ever had, or ever could have had, or may
have in the future arising from or relating to any and all matters preceding the
date of this Agreement, against each other, including, without limitation: those
that were or could have been brought in the First Lawsuit, the Second Lawsuit,
and the Interference; and, all claims falling within the Covenant Not to
Commence Further Proceeding set out in paragraph 3, below. The Parties agree and
acknowledge that this Agreement is supported by adequate consideration, is
freely and voluntarily given, without any duress or coercion, and after the
Parties have consulted with their legal counsel and carefully and completely
read all the terms and provisions of this Agreement.

3.  COVENANT NOT TO COMMENCE FURTHER PROCEEDINGS: The Parties, collectively and
individually, hereby covenant that they will not commence any action or lawsuit
in law or in equity or any administrative or other proceeding, including,
without limitation, proceedings in the United States Patent and Trademark
Office, against each other to the extent that such litigation or other
proceeding is within the scope of the release in paragraph 2 of this Agreement
or is otherwise in violation of any of the covenants or undertakings contained
in this Agreement. Uroplasty, Ersek, Beisang and Beisang III, collectively and
individually, also covenant that they will not commence or assist others in the
commencement or prosecution of any legal, administrative or other proceeding
which challenges Carbon Medical's proprietary or other rights to its carbon bead
technology and products, as now or hereafter constituted, including
specifically, but without limitation, filings, applications or proceedings in
the United States Patent and Trademark Office contesting any issued patent or
patent application of Carbon Medical to the extent that such patent or patent
application relates to Carbon Medical's bead technology or products, as now or
hereafter constituted. In addition to any liability that shall accrue upon
breach of this covenant, the breaching party shall pay all reasonable attorneys'
fees and costs incurred by the non-breaching party or parties in defense
thereof.

4.  DISMISSAL OF LAWSUITS: Upon execution of this Agreement, counsel for the
appropriate Parties shall execute and cause to be filed with the Ramsey County
District Court a Stipulation for Order dismissing all claims with prejudice in
the First Lawsuit, with the Parties to bear their own costs. Upon execution of
this Agreement, counsel for the appropriate Parties shall also execute and cause
to be filed with the United States District Court a Stipulation for Order
dismissing all claims with prejudice in the Second Lawsuit, with the Parties to
bear their own costs.

5.  COVENANT TO ABANDON PATENT APPLICATION: Within five (5) days of execution of
this Agreement, Uroplasty will file in the United States Patent and Trademark
Office a written declaration of abandonment of Uroplasty's Patent Application
and request for Interference and shall not file any continuation, continuation
in part applications or foreign applications based on Uroplasty's Patent
Application. At the same time, Uroplasty shall also execute and cause to be
filed with the United States Patent and Trademark Office a written declaration
of abandonment of any and all United States and foreign applications (if any)
claiming the benefit of the filing date of Uroplasty's Patent Application and a
written withdrawal

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of its request for an Interference with Carbon Medical's Patent. Uroplasty,
Ersek, Beisang and Beisang III agree never to file a request for an Interference
with Carbon Medical's Patent. Uroplasty, Ersek, Beisang and Beisang III also
agree to file a request with the United States Patent and Trademark Office for
entry of an adverse judgment in any interference between a case owned by
Uroplasty, Ersek, Beisang and/or Beisang III and Carbon Medical's Patent within
five (5) days after declaration of any such Interference. If the objectives of
this Agreement cannot otherwise be achieved and if requested to do so by Carbon
Medical, Uroplasty, Ersek, Beisang and Beisang III agree to assign immediately
to Carbon Medical Uroplasty's Patent Application, any and all U.S. and foreign
applications claiming the benefit of the filing date of that application, and
Uroplasty's request for Interference with Carbon Medical's Patent.

6.  INDEMNIFICATION FOR FUTURE CLAIMS: Uroplasty agrees to indemnify and hold
Carbon Medical, Brennen Medical, Inc., Timothy Lawin, and their respective
officers, directors, employees, agents, insurers, successors, representatives,
heirs and assigns, and each of them, harmless from any and all manner of loss,
damage, claim, proceeding, award, cost or expense, including, without
limitation, attorneys fees and costs, incurred by them, or any of them, in or in
connection with litigation or any other proceeding of any manner or nature
whatsoever by or on behalf of Uroplasty or their officers, directors, employees,
agents, insurers, successors, representatives, heirs or assigns, including,
without limitation, proceedings brought in the United States Patent and
Trademark Office, to the extent that the subject matter of such litigation or
other proceeding is within the scope of the release in paragraph 2, above, or is
otherwise in violation of any of the covenants or undertakings contained in this
Agreement.

7.   SEVERABILITY: If any provision of this Agreement is held by a Court of
competent jurisdiction to be invalid, void, or unenforceable, the remaining
provisions shall nonetheless continue in full force and effect without being
impaired or invalidated in any way.

8.  EXECUTION IN COUNTERPARTS: This Agreement may be executed in counterparts,
each of which, when so executed, shall be deemed to be an original, and such
counterparts together shall constitute one and the same instrument.

9. ENTIRE AGREEMENT: This Agreement constitutes the entire understanding among
the Parties hereto and may not be modified, amended or waived, except by an
instrument, in writing, executed by the Party against whom such an amendment,
clarification, or waiver is sought to be enforced. This Agreement was negotiated
among the Parties, represented by their respective counsel, and shall not be
deemed to have been drafted by any Party hereto. The undersigned entered into
this Agreement voluntarily and for reasons of their own doing, and in so doing
have not relied upon any statement or representation of any Party except as set
forth herein.

10.  CONFIDENTIALITY: The Parties agree to keep confidential the terms of this
Agreement, other than as necessary to complete their respective obligations
under the Agreement, to enforce this Agreement, and as may be required by 35
U.S.C.ss.135(c).

11.  BENEFIT: This Agreement inures to the benefit of and is binding upon the
Parties, as well as their respective representatives, agents, successors, heirs
and assigns.

12.  DISPUTES: The Parties agree that they and any disputes arising from this
Agreement will be subject to the exclusive jurisdiction of the United States
District Court, District of Minnesota or Ramsey County District Court, and that
the sole venue for the litigation of such disputes shall be either Court as may
be appropriate. The prevailing party in any such dispute shall be entitled to an
award of reasonable attorney fees and such other relief, in law or equity, to
which that party may be entitled.

IN WITNESS WHEREOF, the Parties have executed this Agreement on the dates
specified below adjacent to their respective signatures.

<PAGE>

UROPLASTY, INC.

By ___________________________________    Date of Execution ____________________
Its __________________________________

CARBON MEDICAL TECHNOLOGIES, INC.

By ___________________________________
Its __________________________________   Date of Execution _____________________

BRENNEN MEDICAL, INC.

By ___________________________________   Date of Execution _____________________
Its __________________________________

______________________________________   Date of Execution _____________________
Timothy P. Lawin

______________________________________   Date of Execution _____________________
Robert Ersek, M.D.

______________________________________   Date of Execution _____________________
Arthur A. Beisang

______________________________________   Date of Execution _____________________
Arthur A. Beisang III, M.D.<PAGE>
                                                                   EXHIBIT 10.1

                          THIRD AMENDMENT TO AGREEMENT

     THIS AMENDMENT TO AGREEMENT, dated this 30th day of July, 2001, between
UNITED FEATURE SYNDICATE, INC., d.b.a. UNITED MEDIA, a New York corporation with
its principal office at 200 Madison Avenue, 4th Floor, New York, New York 10016
("UM"), as exclusive worldwide licensing representative of PRECIOUS MOMENTS,
INC., an Illinois corporation with its principal office at 2170 Point Boulevard,
Suite 200, Elgin, Illinois 60123 ("Licensor"), and ENESCO GROUP, INC., a
Massachusetts corporation with its principal office at 225 Windsor Drive,
Itasca, Illinois 60143 ("Licensee"), is to evidence:

     WHEREAS, pursuant to an agreement dated July 1, 1993, Licensor granted
Enesco Corporation, an Ohio corporation ("Enesco Ohio"), certain rights with
respect to the PRECIOUS MOMENTS property; and

     WHEREAS, said agreement was amended by amendments dated December 29, 1997,
and January 22, 1999 (said agreement, as amended, being hereinafter referred to
as the "Agreement"); and

     WHEREAS, Enesco Ohio assigned the Agreement to Licensee effective January
21, 2000; and

     WHEREAS, since the Agreement was signed UM has become exclusive worldwide
licensing representative of Licensor; and

     WHEREAS, the resolution of all issues relating to the granting of mass
market rights to Licensee, to the right of Licensor and UM to license the right
to manufacture, distribute, sell, and advertise KEEPSAKE ornaments, and to the
modification of the definition of "Licensed Products" under the Agreement, as
evidenced by a comprehensive and fully executed amendment to the Agreement, is a
condition subsequent to the granting (to the extent previously given) of product
approvals for Licensed Products intended by Licensee for the mass market channel
of distribution;

     WHEREAS, the parties wish to amend the Agreement further in certain
respects;

     NOW, THEREFORE, the Agreement is amended as follows:

     1. Exhibits B-1 and B-2 are deleted and new Exhibits B-1 and B-2, attached
hereto and made a part hereof, substituted therefor.

     2. Paragraph 25 is deleted and the following substituted therefor,
effective January 1, 2001:

     "25. PAYMENTS, REPORTS, AND NOTICES. All royalty checks, which shall be
made payable to UM, and accounting statements shall be sent by Licensee to the
following address:

                     United Media
                     Attn:  Controller, Licensing
                     P.O. Box 85271
                     Cincinnati, Ohio 45264

<PAGE>

Copies of all royalty checks and accounting statements shall be sent
simultaneously to the following address:

                     United Media
                     Attn:  Financial Manager, Licensing
                     200 Madison Avenue, 4th Floor
                     New York, New York 10016

Any notice given under this Agreement shall be in writing and shall be mailed by
first class mail, postage prepaid, to the parties at the following addresses:

     TO LICENSOR:                                TO LICENSEE:

     PRECIOUS MOMENTS, INC.                      ENESCO GROUP, INC.
     Attn:  Ms. Sara Pilafas                     Attn:  President
     2170 Point Boulevard, Suite 200             225 Windsor Drive
     Elgin, Illinois 60123                       Itasca, Illinois 60143

Copies of all notices to Licensor shall be sent to the following address:

     UNITED MEDIA
     Attn:  Senior Vice President/Licensing
     200 Madison Avenue, 4th Floor
     New York, New York 10016

Copies of notices to Licensee shall be sent to the following address:

     ENESCO GROUP, INC.
     Attn:  General Counsel
     225 Windsor Drive
     Itasca, Illinois 60143

Either party may change the address for notices by written notice to the other
parties. Any notice, statement, and/or payment given under this Agreement shall
be deemed given on the date of delivery, or, if sent by either registered or
certified mail, 24 hours after the date on which the envelope containing the
notice, properly addressed and postage prepaid, is deposited at the United
States Post Office during its business hours or is postmarked in a United States
Post Office or is delivered to an established commercial courier service."

     3.   The following new paragraph 34 is added:

     "34. MASS MARKET RIGHTS.

     "(a) Extension of Grant of License. Subject to all of the terms and
conditions of this paragraph 34, Licensor and UM hereby agree that the rights
granted Licensee under the provisions of subparagraphs 2(a) and 2(b) of this
Agreement shall be extended, effective as of the date of execution of the third
amendment to this Agreement, to the mass market channel of distribution;
provided, however, that Licensee shall have no right to distribute FIGURINES or
HANGING ORNAMENTS manufactured of porcelain bisque in the mass market channel of
distribution. Licensed Products sold by Licensee through the mass market channel
shall be

                                                                         Page 2

<PAGE>

separately identified on Licensee's royalty accountings rendered pursuant to
this Agreement to the extent such Licensed Products are sold F.O.B. Far East.
Independent of its royalty accountings, the Licensee shall also provide PMI and
UM, on a regular basis as reasonably requested by PMI and UM, the following
information concerning sales of the Licensed Products via the mass market
channel of distribution: number of skus sold to key accounts; types of skus sold
to key accounts; and sell-through performance of each sku.

     "(b) Term for Mass Market Rights. Notwithstanding the provisions of
paragraph 3, the term of the grant of license with respect to mass market rights
shall commence on the date of execution of the third amendment to this Agreement
and end on December 31, 2007, and mass market rights shall not be subject to the
provisions of paragraph 3 relating to automatic renewals.

     "(c) Standards for Foreign Mass Market Distributors; Foreign Distributors
Unacceptable to Licensor and UM. Licensee agrees that Licensed Products
distributed in the foreign mass market shall be distributed through distributors
whose standards of operation and quality of product presentation are consistent
with the wholesome nature and goodwill of the Property and in keeping with the
standards represented in the United States and Canada by such mass marketers as
Wal Mart, K Mart, and Target. Licensee acknowledges that the foreign mass market
distributors identified on Exhibit E, attached hereto and made a part hereof,
are unacceptable to Licensor and UM, and Licensee agrees not to distribute any
of the Licensed Products through said mass market distributors. Notwithstanding
the foregoing, Licensor and UM agree to give good faith consideration to any
request from Licensee to delete one of said mass market distributors from
Exhibit E.

     "(d) Exploitation of Certain Rights by Licensor and UM. In consideration of
the rights granted Licensee under subparagraph 34(a), Licensee agrees that
Licensor and UM shall have the right to license to Hallmark Cards, Incorporated,
and its affiliates and subsidiaries throughout the Territory (`Hallmark') the
right to use the Precious Moments Artwork and Designs and the Licensed Marks in
connection with the manufacture, distribution, sale, and advertising, solely
through gift and card channels, of general KEEPSAKE hanging ornaments (the
`General Ornaments') and KEEPSAKE hanging ornaments that are part of a promotion
(the `Promotional Ornaments'). Such licenses to Hallmark in each country of the
Territory shall be subject to the following conditions, restrictions, and
limitations: (i) between three and six skus of the General Ornaments and between
three and six skus of the Promotional Ornaments shall be distributed during any
calendar year; provided, however, that Licensee agrees to give good faith
consideration to proposals from Licensor and UM to increase the quantity to up
to 12 skus of the General Ornaments and up to 12 skus of the Promotional
Ornaments in any calendar year where there is a creative justification for such
increase (e.g., a `Twelve Days of Christmas' promotion); (ii) Licensor and UM
shall use best efforts to encourage Hallmark in a country where Licensee is
actively marketing the Licensed Products to cross-promote its sales of the
General Ornaments and/or the Promotional Ornaments with the Licensed Products
and also to collaborate with Licensee on creative issues; (iii) neither the
General Ornaments nor the Promotional Ornaments shall be produced in porcelain
bisque; (iv) Licensor and UM shall contractually impose upon Hallmark the
requirement that the General Ornaments and the Promotional Ornaments be produced
and marketed by Hallmark in a manner the standards of operation and quality of
product presentation of which are consistent with the wholesome nature and
goodwill of the Property; and (v) no such license shall extend beyond December
31, 2007 (except that Licensor and UM shall be entitled to grant Hallmark a
reasonable non-exclusive sell-off period beyond that date)."

                                                                         Page 3

<PAGE>

     4. A new Exhibit E, attached hereto and made a part hereof, is added.

     5. The October 27, 1998, side letter relating to the Agreement shall be of
no further force and effect. The December 17, 1998, side letter relating to the
Agreement shall remain in full force and effect.

     6. Except as expressly modified by this amendment, all terms and conditions
of the Agreement shall remain in full force and effect.

     IN WITNESS WHEREOF, the parties have executed this third amendment to
agreement on the date set forth above.

                                  UNITED FEATURE SYNDICATE, INC.,
                                  d.b.a. UNITED MEDIA, as exclusive
                                  worldwide licensing representative
                                  of PRECIOUS MOMENTS, INC.

                                  By /s/Joshua Kislevitz
                                     ------------------------------------------
                                     Senior Vice President                Title

                                  ENESCO GROUP, INC.

                                  By /s/M. Frances Durden
                                     ------------------------------------------
                                     Vice President and Secretary         Title

     PRECIOUS MOMENTS, INC., acknowledges that it has reviewed and approves the
provisions of this third amendment to the Agreement.

                                  PRECIOUS MOMENTS, INC.

                                  By /s/Sara Pilafas
                                     ------------------------------------------
                                     President                            Title

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