TECHNOLOGY LICENSE AGREEMENT

EXHIBIT 2.7


TECHNOLOGY LICENSE AGREEMENT


THIS TECHNOLOGY LICENSE AGREEMENT (the "Agreement"), effective as of July 8, 1998 (the "Effective Date"), is entered into by and between Baxter Healthcare Corporation, a Delaware corporation having a place of business at 1627 Lake Cook Road, Deerfield, Illinois 60015 ("Baxter"), Baxter International Inc., a Delaware corporation having a place of business at One Baxter Parkway, Deerfield, Illinois 60015 ("BII"), and UroGen Corp., a Delaware corporation having a place of business at 10835 Altman Row, Suite A, San Diego, California 92121 ("UroGen").


RECITALS


A. Baxter and UroGen have entered into a certain Asset Purchase Agreement dated as of February 28, 1998 as amended by that certain Amendment to Asset Purchase Agreement dated as of May 27, 1998, between Baxter and UroGen (as so amended the "Asset Purchase Agreement") pursuant to which Baxter has agreed to license the Mini-Ad Vector Technology until the Investment Milestone Date (both as defined below) to UroGen; and


B. Pursuant to the terms of the Asset Purchase Agreement, UroGen desires to obtain an exclusive license under the Intellectual Property Rights until the Investment Milestone Date (as defined below), and Baxter and BII desire to grant such a license to UroGen, on the terms and conditions herein.


NOW, THEREFORE, Baxter and UroGen agree as follows:


1. DEFINITIONS


1.1 Terms Defined in Asset Purchase Agreement. Unless otherwise defined
----------------------------------------- herein, all capitalized terms shall have the meanings ascribed to such terms as set forth in the Asset Purchase Agreement.


1.2 "Affiliate" of a party shall mean any entity (i) which directly or
--------- indirectly through one or more intermediaries Controls, is Controlled by, or is under common Control with, the party or (ii) fifty percent (50%) or more of the voting capital stock (or in the case of an entity which is not a corporation, fifty percent (50%) or more of the equity interest) of which is beneficially owned or held by a party or any of such party's Subsidiaries. The term "Control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of an entity (other than a natural person), whether through the ownership of voting capital stock, by contract or otherwise.


1.3 "Investment Milestone Date"shall mean the date on which UroGen shall
------------------------- achieve the Investment Milestone.


1.4 "Licensed Product" shall mean any product which (a) but for the
---------------- license granted herein would infringe a Valid Claim in the country such product is made or sold; or (b) incorporates or uses any component of the Intellectual Property Assets.


1.5 "Territory" shall mean all countries of the world.
---------


1.6 "Valid Claim" shall mean (i) a claim of an issued and unexpired patent
----------- included within the Intellectual Property Assets which has not been held unenforceable or invalid by a court or other governmental agency of competent jurisdiction, and which has not been disclaimed or admitted to be invalid or unenforceable through reissue or otherwise, or (ii) a claim of a pending patent application within the Intellectual Property Assets, provided that not more than five (5) years have elapsed from the date the claim takes priority for filing purposes.


2. GRANT


2.1 Grant. Baxter and BII hereby grant to UroGen an exclusive, worldwide
----- license under the Intellectual Property Assets, with the right to grant and authorize sublicenses, to make, have made, import, have imported, use, sell, offer for sale and otherwise distribute and exploit the Licensed Products in the Territory. Any sublicense granted by UroGen under the terms of this Agreement shall provide for automatic termination of such sublicense upon the expiration or early termination of this Agreement.


3. CONSIDERATION


3.1 Consideration. In primary consideration of the license granted
------------- herein, UroGen shall provide to Baxter certain UroGen stock as set forth in the Asset Purchase Agreement. In further consideration of the license granted herein, UroGen shall pay to Baxter royalties on sales of Licensed Products sold by UroGen as set forth in the Royalty Agreement.


4. PAYMENTS


4.1 Payments. UroGen agrees to pay all royalties due to Baxter pursuant
-------- to the terms of the Royalty Agreement. UroGen agrees to pay all stock consideration due to Baxter pursuant to the terms of the Asset Purchase Agreement.


4.2 Taxes. Where required to do so by applicable law, UroGen shall
----- withhold taxes required to be paid to a taxing authority on account of any payments to Baxter hereunder, and UroGen shall furnish Baxter with satisfactory evidence of such withholding and payment in order to permit Baxter to obtain a tax credit or other such relief as may be available under applicable laws. UroGen shall cooperate with Baxter in obtaining exemption from withholding taxes wherever available under applicable law.


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5. PROSECUTION AND ENFORCEMENT


5.1 Responsibilities. Baxter and UroGen affirm that the respective rights
---------------- and responsibilities associated with the preparation, filing, prosecution and maintenance of any patents for the Intellectual Property Assets and the Collaboration Products shall be governed by the terms of the Distribution Agreement and the Development Agreement, respectively.


6. DISPUTE RESOLUTION


6.1 Provisional Remedies: The procedures specified in this Section 6
-------------------- shall be the sole and exclusive procedures for the resolution of disputes between the parties arising out of or relating to this Agreement; provided,
-------- however, that a party, without prejudice to these procedures, may seek a - ------- preliminary injunction or other provisional relief if, in its sole judgment, such action is deemed necessary to avoid irreparable damage or to preserve the status quo. During such action. the parties will continue to participate in good faith in the procedures specified in this Section 6.


6.2 Negotiations Between Executives: The parties will attempt in good
------------------------------- faith to resolve any claim or controversy arising out of or relating to the execution, interpretation or performance of this Agreement (including the validity, scope and enforceability of the provisions contained in this Section 6) promptly by negotiations between one designated executive from each of UroGen, Baxter and/or BII who will attempt in good faith to resolve any dispute or undecided matter referred to them.


6.3 Arbitration: In the event that any dispute arising out of or relating
----------- to this Agreement or its breach, termination or validity has not been resolved after good faith negotiation pursuant to the procedures of Section 6.2, such dispute shall upon written notice by any party to the others, be finally settled by arbitration administered by JAMS/Endispute in accordance with the provisions of its Comprehensive Arbitration Rules and Procedures and the United States Federal Arbitration Act, as modified below:


A. The arbitration shall be heard by a panel of three (3) independent and impartial arbitrators, all of whom shall be selected from a list of neutral arbitrators supplied by JAMS/Endispute. From such list, each of Baxter and/or BII and UroGen shall select one (1) arbitrator, and the arbitrators so selected shall select a third. The panel shall designate one (1) among them to serve as chair.


B. The arbitration proceedings shall be conducted: (a) if notice demanding arbitration is delivered by UroGen to Baxter or BII, in Cook County, Illinois, or (b) if notice demanding arbitration is delivered by Baxter or BII to UroGen, in San Diego County, California.


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C. Any party may seek interim or provisional remedies under the Federal Rules of Civil Procedure and the United States Federal Arbitration Act as necessary to protect the rights or property of the party pending the decision of the arbitrators.


D. The parties shall allow and participate in limited discovery for the production of documents and taking of depositions, which shall be conducted in accordance with the Comprehensive Arbitration Rules and Procedures of JAMS/Endispute. All discovery shall be completed within sixty (60) days following the filing of the answer or other responsive pleading. Unresolved discovery disputes shall be brought to the attention of the chair of the arbitration panel and may be disposed of by the chair.


E. Each party shall have up to fifty (50) hours to present evidence and argument in a hearing before the panel of arbitrators provided that
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