**Exhibit 10.17**

 

**AMENDMENT NO. 2 TO**

**MARKETING AND DISTRIBUTION AGREEMENT**

**DATED MARCH 30, 2007 BETWEEN**

**VITAL IMAGES, INC. AND TOSHIBA MEDICAL SYSTEMS CORPORATION**

 

**THIS AMENDMENT NO. 2 (the “Amendment”)** ismade as of November 26, 2007 by and between Vital Images, Inc., a Minnesota corporation having its principalplace of business at 5850 Opus Parkway, Suite 300, Minnetonka, Minnesota55343 USA (“Vital Images”)  and Toshiba Medical Systems Corporation havingits place of business at 1385, Shimoishigami, Otawara-Shi, Tochigi 324-8550,Japan (“Toshiba”).

 

ThisAmendment modifies the Marketing and Distribution Agreement dated March 30,2007 as amended by the Amendment No. 1 dated November 26, 2007 made between the parties (hereinafter collectivelycalled as “Agreement”). Under this Amendment, the following items in theAgreement are modified as set forth below:

 

1.             Exhibit A (Products): TheProducts set forth on Exhibit A to this Amendment shall be added to Exhibit Aof the Agreement as Products for Japan.

 

2.             Exhibit B (Territory): “Japan”shall be added as Territory and the Territory as set forth in Exhibit B ofthe Agreement shall be amended as set forth on Exhibit B to thisAmendment.

 

3.             Exhibit E (Product Price List):Pricing for “Non-USA” set forth on Exhibit E to this Amendment shall applyfor the prices of Products for Japan.

 

4.             Article 1.8 (“First LevelInstallation”): This Article is amended by inserting, at the end of theArticle, the following:

 

“ With regard to the Products for Japan, Toshiba performs unloading,assembling and powering up the applicable computer workstation(s), installingthe Products onto such computer workstation(s) in its factory beforeshipping the Products to the customer sites and integrating such computerworkstation(s) onto the customer’s computer network.

 

5.             Article 2.1 (“Scope”):  With regard to the Products for Japan, thefirst sentence of this Article providing appointment of Toshiba as VitalImages’ non-exclusive reseller of the Products is replaced by the followingsentence:

 

“Toshibamay, at its discretion, install the Products as an option onto computerworkstation(s) to link to Toshiba CT equipment (hereinafter collectivelycalled as “Toshiba CT System(s)”) to be distributed, sold, leased or otherwisedisposed by Toshiba in Japan, but may not distribute, sell, lease or otherwisedispose of the Products in any other manner.”

 

6.             Article 2.1(“Scope”):  With regard to the Productsfor Japan, the words “failed hardware replacement” is added to the secondsentence of this Article and the sentence is replaced by the following:

 

“All sublicenses ofthe Products are one-time sublicenses, whether or not they are granted on aterm or perpetual basis, and after the initial sublicense of any Product to acustomer, Toshiba or the Dealer Associates may not sublicense any Products thatare returned by that customer, provided that Toshiba may reinstall Productswithout paying an additional license fee when such reinstallation is inconnection with a

 

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customer trade-in,failed hardware replacement or upgrade of equipment purchased from Toshiba andit is the same customer for which the software was initially licensed.”

 

7.             Article 2.3 (“Use of Terms”):  This Article is amended by inserting, atthe end of the Article, the following:

 

“Withregard to the Products for Japan, all words, “reseller of Products”, aselsewhere provided in the Agreement shall be replaced by the words, “licenseeof Products”, provided that no rights shall accrue to Toshiba as a licensee ofthe Products for Japan except as expressly set forth herein.

 

8.             Article 3.1 (“Marketing”)(a):  With regard to the Products forJapan, this item (a) is replaced by the following sentence:

 

“Touse its commercially reasonable best efforts to further the promotion,marketing and distribution of the Toshiba CT Systems in Japan at Toshiba’sdiscretion;”

 

9.             Article 3.2 (“ToshibaDemonstration License”):  With regard tothe Products for Japan, the language in the first sentence of this Article, “Toenable Toshiba to better perform its marketing and distribution of the Products”is replaced by the following language:

 

“Toenable Toshiba to better perform its marketing and distribution of the ToshibaCT Systems”

 

10.           Exhibit G (Products): The followingtrade shows shall be added to Exhibit G of the Agreement, at which tradeshows Toshiba may demonstrate the Products, including the Products for Japan,provided that attendance by Vital Images is not required.

 

“JapanRadiology Congress/International Technical Exhibition of Medical Imaging (JRC/JIRA)

JapaneseCongress of Cardiology (JCC)

TheJapanese Circulation Society (JCS)

JapanDigestive Disease Week (JDDW)

JapanNeurosurgical Society (JNS)

Othertrade shows as may be designated by Toshiba”

 

11.           Article 4.4 (“Training”):  This Article is amended by inserting, atthe end of the Article, the following:

 

“Withregard to the Products for Japan, Vital Images shall provide appropriatetraining, minimum two times, two days for each, at no charge, with Toshiba’sdesignate personnel who will train Toshiba’s engineers, service personnel, atmutually agreeable location in Japan. To enable Toshiba to better perform itstraining to engineers, service and application personnel, Vital Images grantsto Toshiba the right to produce and copy training materials, either in Englishor Japanese, modifying Vital Images’s materials.”

 

12.           Article 4.5 (“Customer Training”):  This Article is amended by inserting, atthe end of the Article, the following:

 

“Notwithstandingthe foregoing, with regard to the Products for Japan, Toshiba shall providecustomer training to Toshiba’s customer of Toshiba CT Systems.”

 

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13.           Article 5.1 (“Purchase Orders”):  This Article is amended by inserting, atthe end of the Article, the following:

 

“With regard to the Products for Japan, Toshiba may order Products to VitalImages and pay for the Products, through the following Toshiba’s agent (“Agent”).

 

Agent:

ToshibaAmerica, Inc. (Boston)

24New England Executive Park,

BurlingtonMA, 01803, U.S.A.

Attention:Branch Manager

 

Forthe purpose of this Agreement, Toshiba hereby appoints Agent as its authorizedagent having an authority to perform any and all of Toshiba’s obligations andundertakings under this Agreement under its own name and on behalf of Toshiba,including, without limitation:

 

(a) tosubmit purchase orders for the Products;

(b) toreceive shipments of the Products and invoices therefore;

(c) tomake payments due to the Vital Images for the Products purchased;

(d) toconfirm and follow up deliveries of the Products; and

(e) toreturn the defective or non-conforming Products.

 

Notwithstandinganything else contained herein, Toshiba shall remain directly liable to theVital Images for all actions taken by Agent. Toshiba may, at its solediscretion but with at least forty-five (45) days prior written notice to theVital Images, withdraw all of the authority of Agent provided above. Uponreceipt of such notice, the parties shall agree upon alternative proceduralarrangements in order to ensure the orderly and timely supply of the Productsto Toshiba hereunder and payment therefore.

 

14.           Article 5.5 (“PurchaseCommitment “):  This Article isamended by inserting, at the end of the Article, the following:

 

“Forthe avoidance of doubt, Toshiba’s payment for the Products for Japan shall beincluded in the minimum purchase Commitments set forth on Exhibit F.”

 

15.           Article 7.1(“Prices”):  With regard to the Pricesfor Japan, the words “and Product for Japan” is added to the first sentence inthe second paragraph of this Article and the sentence is replaced by thefollowing:

 

“Inrecognition of the purchase commitments made by Toshiba and its DealerAssociates pursuant to Section 5.5 of this Agreement, Vital Images herebycovenants and agrees that the transfer price charged to Toshiba and its DealerAssociates for the standalone Products and Product for Japan shall at alltimes be lowest transfer price charged by Vital Images to anyone, except forgovernmental customers, research sites, training sites, show sites, luminaries,collaborators, and resolution of customer satisfaction issues.”

 

16.           Article 7.2 (“Payment Terms”):  This Article is amended by inserting, atthe end of the Article, the following:

 

“Toshibashall seek an exemption from withholding tax obligations to the extentavailable under applicable tax treaties between U.S.A. and Japan, and VitalImages shall reasonably cooperate with Toshiba in completing and executing anydocuments necessary for obtaining such exemption, including, withoutlimitation, providing Toshiba with the U.S. residency certificates, completingand executing relevant documents to be submitted to applicable taxationauthorities.”

 

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17.           Article 8.1 (“GovernmentApproval”): This Article is amended to include the following sentence:

 

“Notwithstandingthe above, with regard to the Products for Japan, it is understood between theparties that Toshiba will (i) be a # solely for the purposeof Government Approval of the Toshiba CT System incorporating the Productsas option (provided that Toshiba’s status or appearance as such # andthis Article 8.1 shall not affect the provisions in Article 3.4 norVital Images’s status as the developer of the Products and owner of all rightstherein), and (ii) be required to file all applications required toobtain all necessary registration and/or Government Approval, including,without limitation, approval under the Pharmaceutical Affairs Laws of Japan asmay be amended from time to time, for the Toshiba CT System to be sold byToshiba in Japan.  Vital Images shall furnish Toshiba with such assistanceand cooperation as may be reasonably requested in connection with the securingof such Government Approval.”

 

18.           Article 8.4 (“Corrective Action “)(a) (“Notice of Corrective Action”): This Article is amended by inserting, at the end of the Article,the following:

 

“Withregard to the Products for Japan,  if TOSHIBA believesthat a corrective action with respect to the Products incorporated in theToshiba CT Systems is desirable or required by law, or if any governmentalagency having jurisdiction (including, without limitation, Ministry of Health,Labour and Welfare) shall request or order any corrective action with respectto the Products incorporated in the Toshiba CT Systems, including any recall,customer notice, restriction, change, corrective action or market action or anyProduct change, TOSHIBA shall promptly notify Vital Images. Any and allcorrective actions shall be conducted at the expense of Vital Images, exceptcosts associated with notifying customers of such corrective action. Toshibashall maintain complete and accurate records, for such periods as may berequired by applicable law, of all Toshiba CT Systems they sold. The partiesshall cooperate fully with each other in effecting any corrective action withrespect to the Products pursuant to this Article 8.4, includingcommunication with any customers and Vital Images shall comply with allreasonable directions of TOSHIBA’ regarding such corrective action. This Article 8.4shall not limit the obligations of either party under law regarding anycorrective action with respect to the Products required by law or properlymandated by governmental authority.”

 

19.           This Amendment shall take effect asof October 1, 2007.

 

20.           Except as amended hereby, theAgreement shall remain in full force and effect in accordance with its originalterms. The amended portions of the Agreement shall be read, wherever reasonableto do so, to be consistent with the portions not so amended; provided that theamended portions shall be deemed to control and any conflict shall be resolvedin favor of such amended portions.

 

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**# Confidential Treatment has beenrequested, the portion indicated has been redacted and the redacted portion hasbeen separately filed with the Securities and Exchange Commission.**

 

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**INWITNESS WHEREOF,** the parties have caused this Agreement to be executed bytheir duly authorized representatives below.

 
| VITAL IMAGES, INC. |                                         | TOSHIBA MEDICAL  SYSTEMS   CORPORATION |
|--------------------|----------------------------------------------|----------------------------------------|
|               |                                         |                                   |
|               |                                         |                                   |
| By                 | /s/ Susan A. Wood                            |                                   | By | /s/ Yusuke Toki |
|               |                                         |                                   |   |   |   |
| Name               | Susan A. Wood                                |                                   | Name | Yusuke Toki |
|               |                                         |                                   |
| Title              | Executive Vice  President, Product Marketing |                                   | Title | CT General Manager |
|               | and Development                              |                                   |   |
|                    |                                              |                                        |  |  |  |  |  |  |  |  |  |

 

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**EXHIBIT A**

**PRODUCTS**

 

***Exhibit A of the Agreement  is modified by adding the following Productsfor Japan:***

 

| *Vitrea**â*                                         |
|----------------------------------------------------------|
| *VScore**Ô option*                                  |
| *VScore with EKG Gate**Ô option*                    |
| *VScore  with AutoGate*Ô option                     |
| *3D Angiography option*                                  |
| *CT  Perfusion option*                                   |
| *CT  Colonography option*                                |
| *Automated  Vessel Measurements option*                  |
| *CT  Cardiac option*                                     |
| *Cardiac  Functional Analysis option*                    |
| *CT  Cardiac Option with Peripheral Vessel Probe option* |
| *SUREPlaqueTM  option*                               |
| *# **                                                    |
| *Peripheral  Vessel Probe option*                        |
| *Soft Read  option*                                      |
| *Nodule  Probe option (Lung option)*                     |
| * *                                                 |
| * *                                                 |
| *Vitrea  ACCESSTM option(3)(4)*                          |
| *Vitrea ACCESS Remote  option*                           |
| # *                                                      |
| # *                                                      |
| # *                                                      |

* *

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**when and if available*

 

**# Confidential Treatment has beenrequested, the portion indicated has been redacted and the redacted portion hasbeen separately filed with the Securities and Exchange Commission.**

 

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**EXHIBIT B**

**TERRITORY**

 

Worldwide, including Japan, except for those countries barred by the

 

Office of Foreign AssetsControl (“OFAC”) of the U.S. Department of the Treasury

 

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**EXHIBIT E**

**PRODUCT PRICE LIST**

 

***Exhibit E****of the**Agreement is modified byadding the following package and maintenance prices:***

 

**ADDITIONALPRODUCT PRICE**

 
| **Licence**                                   | ** **          | **Pricing** |
|-----------------------------------------------|---------------------|-------------|
| ** **                                    | **U.S.A.   (2007)** | ** **  | **Non-U.S.A.   (2007)** |
| ***Genesis***                                 | ** **          | ** **  | ** ** | ** ** |
| ·    #   * |                | $           |  # |   | $ |  # |
| ·    #   * |                | $           |  # |   | $ |  # |

* *

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**when and if available*

 

**ADDITIONALSOFTWARE PACKAGE PRICING**

 
| ** **                                                                                                                                                 | ** ** | **Pricing**         |
|------------------------------------------------------------------------------------------------------------------------------------------------------------|------------|---------------------|
| ** **                                                                                                                                                 | ** ** | **U.S.A.   (2007)** | ** ** | **Non-U.S.A.   (2007)** |
| **Package**                                                                                                                                                | ** ** | **Standalone**      | ** ** | **Enterprise** |
| **Genesis**                                                                                                                                                |       | **$**               | ** #** |   | **$** | ** #** |   | **$** | ** #** |
| ·    *Vitrea**â*                                                                                                                  |       |                |   |   |   |   |
| ·    *CT Colonography option*                                                                                                          |       |                |   |   |   |   |
| ·    *Automated Vessel Measurements option*                                                                                            |       |                |   |   |   |   |
| ·    *VScore**Ô option*                                                                                                           |       |                |   |   |   |   |
| ·    *Peripheral Vessel Probe option*                                                                                                  |       |                |   |   |   |   |
| ·    *CT Cardiac option*                                                                                                               |       |                |   |   |   |   |
| ·    *Cardiac Functional Analysis option*                                                                                              |       |                |   |   |   |   |
| ·    *sure PLAQUETM option*                                                                                                        |       |                |   |   |   |   |
| ·    #  *                                                                                                                              |       |                |   |   |   |   |
|                                                                                                                                                       |       |                |   |   |   |   |
| Existing Aquilion customer Upgrade from  Vitrea2 to***Genesis***.  The price for **Enterprise** is only for the customer Upgrade from Vitrea2  Enterprise. |       | $                   |  # |   | $ |  # |   | $ |  # |

* *

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**when and if available*

 

**ADDITIONALMAINTENANCE PRICING OPTIONS**

 
| **Service**         | ** ** | **U.S.A.  (2007)** | ** **  | **Non-U.S.A.**

**(2007)** |
|---------------------|------------|--------------------|-------------|----------------------------|
| **Genesis Package** | ** ** | **$**              | ** #** | ** **                 | **$** | ** #** |
|                     |            |                    |             |                            |  |  |

 

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**# Confidential Treatment has beenrequested, the portion indicated has been redacted and the redacted portion hasbeen separately filed with the Securities and Exchange Commission.**

 

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