Exhibit 10.38**AMENDMENT ONE TO OEM PURCHASE AND SUPPLY AGREEMENT**     This Amendment (the “Amendment”) is made as of August 10, 2004, by and betweenCardiac Science, Inc., a Delaware corporation (“Supplier” or “Cardiac Science” or “CSI”), amedical device developer and manufacturer of automated external defibrillators having itsprincipal place of business at 1900 Main Street, Irvine, CA 92614 and GE Medical SystemsInformation Technologies, Inc., a Wisconsin corporation (“GEMS-IT”), having its principal placeof business at 8200 W. Tower Avenue, Milwaukee, WI 53223. CSI and GEMS-IT may each be referred toherein as a “Party” and collectively, the “Parties”.W I T N E S S E T H:     WHEREAS, CSI and GEMS-IT are parties to an OEM Purchase and Supply Agreement dated July 29,2003 and “Addendum 1” to the OEM Purchase and Supply Agreement dated as of March 24, 2004(collectively, the “OEM Purchase and Supply Agreement”).     WHEREAS, CSI and GEMS-IT desire to supplement and amend the OEM Purchase and SupplyAgreement as set forth herein.     NOW THEREFORE, in consideration of the premises and other good and valuable consideration, thereceipt and adequacy of which is hereby acknowledged, it is agreed as follows:     1.   Construction. Except as provided in this Amendment, the terms and conditions setforth in the OEM Purchase and Supply Agreement shall remain unaffected by execution of thisAmendment. To the extent any provisions or terms set forth in this Amendment conflict with theterms set forth in the OEM Purchase and Supply Agreement, the terms set forth in this Amendmentshall govern and control. Terms not otherwise defined herein, shall have the meanings set forth inthe OEM Purchase and Supply Agreement. This Amendment amends the OEM Purchase and Supply Agreementand not the OEM Purchase Agreement entered into by the Parties on July 29, 2003.
 

 
     2.   Section 14.5 of the OEM Purchase and Supply Agreement is deleted in its entirety and replaced with the following: 14.5 Duty to Report Incidents. GEMS-IT and Supplier shallinform each other inwriting, within 5 business days from knowledge of a reportable event, of allincidents relating to the subject matter of the Agreement that must bereported according to the FDA Medical Device Reporting regulation (21CFR Part 803) or the European Medical Device Vigilance regulations or thatmust be registered according to other national regulations such as Canadianmedical device regulations, including without limitation incidents involvingdeath or serious injury, malfunctions that, if recurrent, may cause orcontribute to death or serious injury or other material quality problems orconcerns. Supplier will be responsible for reporting such incidents to theappropriate regulatory authority. GEMS-IT shall fully cooperate withSupplier as may be necessary to comply with any reporting obligationsregarding such incidents or quality concerns.     3.   Section 14.6 of the OEM Purchase and Supply Agreement is deleted in its entiretyand replaced with the following: 14.6 Recalls and Field Corrections.In the event of any recall, productwithdrawal or field correction of any OEM Product that is required by agovernmental agency, by Supplier, or by GEMS-IT for safety or efficacyreasons, the parties agree that (a) they shall promptly notify each other and(b) they shall fully cooperate with each other concerning the necessity andnature of such action. GEMS-IT shall be the point of contact for purchasersof any OEM Product (whether directly or through its distributors). Suppliershall be responsible for making any and all applicable regulatory contactsand for coordination of any recall or field correction activities involvingsuch OEM Products. In the event that any OEM Product requires fieldcorrection or is recalled as a result of (a) the supply by Supplier of aNoncomplying Product or (b) the grossly negligent or intentionally wrongfulact or omission of Supplier or its affiliates or their representatives, thenSupplier shall bear all costs and expenses, including but not limited to thecosts and expenses related to such recall or field correction, communicationsand meetings with all required regulatory agencies, replacement stock,service labor, installation, travel, notifying customers of such recall andany replacement product to be delivered to those same customers, includingshipping costs. To the extent that any such recall or field correction is duein part to the negligent or intentional acts or omissions of GEMS-IT,GEMS-IT shall be responsible for such costs and expenses equitably inproportion to its fault.
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     4.   Section 9.1.1 of the OEM Purchase and Supply Agreement is deleted in its entiretyand replaced with the following: 9.1.1 AED product: for seven (7) years from date of shipment of theOEM Product to GEMS-IT’s end user customers. Batteries are for four (4) yearsfrom date of installation into the AED device. Accessories and consumables forone (1) year or until expiration date, whichever is longer.     5.   Exhibit A of the OEM Purchase and Supply Agreement is amended to provide forthe addition of the OEM Products known as the “Powerheart AED G3” and “Powerheart AED G3Pro”. The specifications for these OEM Products are attached hereto as Exhibit A. GEMS-IT hasthe right to sell these CSI branded OEM Products on a non-exclusive basis in the United Statesand Canada. GEMS-IT has no minimum purchase commitments with respect to the Powerheart AEDG3 and Powerheart AED G3 Pro. CSI shall provide sales training and support to the GEMS-ITSub-Acute team and shall also provide product specialists who shall be available, asnecessary, to assist the GEMS-IT representatives sell these OEM Products.