**Exhibit 10.26****Distributor Agreement**This Distributor Agreement (“Agreement”) is made as of September 20, 2002 between Sutura, Inc.(“Supplier”) a California corporation, having its principal place of business at 17080 NewhopeStreet, Fountain Valley, CA 92708 and Getz Bros. & Co., Inc. (“Distributor”) a Delawarecorporation, located at 225 West Washington Street, Suite 1900, Chicago, IL 60606.In consideration of the mutual promises contained herein, Supplier and Distributor agree asfollows:**1.** **Definitions:**   (a) “Products” means those products listed in Exhibit A attached hereto, asthat Exhibit may be amended to include any and all new products manufactured ordistributed by Supplier within the field of vascular closure and also to excludethose products as may be discontinued by Supplier.   (b) “Territory” means Australia, New Zealand, China, Hong Kong, Taiwan,Korea, Singapore, Malaysia, Philippines, Thailand, India, Indonesia, Sri Lanka,Pakistan, Vietnam, Cambodia, Laos, Bangladesh and Myanmar. **2.** **Appointment and Authority of Distributor:**   (a)** *Appointment:*Subject to the terms and conditions of this Agreement,Supplier hereby appoints Distributor, and Distributor accepts that appointment, asSupplier’s exclusive distributor of the Products in the Territory.   (b)** *Independent Contractors:*Distributor and Supplier are independentcontractors and are engaged in the operation of their own businesses. Neither partyis to be considered the agent of the other party for any purpose whatsoever, andneither party has any authority to enter into any contracts or assume anyobligations for the other party or make any warranties or representations on behalfor the other party unless agreed to in writing by the other party. **3.** **Obligations of Distributor:**   (a) *Registration and Marketing of Products:*Distributor agrees, at itsexpense, to use its best efforts to investigate, obtain government approval for,promote, and distribute the Products, in the Territory as soon as feasible after thedate of this Agreement, using generally the same channels and methods, exercisingthe same diligence and adhering to the same standards which it employs for othermedical application products sold by Distributor, as well as any of Distributor’sown products.
 

 
(b)* Minimum Performance Levels:*Distributor agrees to purchase the numberof units of Products per calendar year during the term of this Agreement that is setforth on Exhibit C; provided, however, that such minimum performance levels shallbe appropriately adjusted by Supplier and Distributor if: (i) one or more events offorce majeure affect Distributor’s ability to meet such levels; (ii) Supplier is unableor refuses to sell Products to Distributor when Distributor orders them;(iii) Products are deleted from this Agreement, (iv) Product registrations aredelayed or denied by local governing agencies through no fault of Distributor, (v)Supplier is unable or refuses to supply reasonable data or information to complywith local governing agencies, (vi) approval for Product reimbursement is delayedor denied by local governing agencies, or (vii) Product reimbursement levelsestablished by government regulatory authorities in the Territory do not allowDistributor to realize a minimum gross profit (defined as revenues from sales ofProducts less Product costs, as well as taxes and shipping expenses incurred inconnection therewith) of forty (40) percent based on existing Supplier pricing.After the years listed in Exhibit C, Distributor and Supplier shall agree on theminimum performance level for each country for each calendar year. If Distributorand Supplier do not agree on acceptable minimum performance levels for anygiven year or country in the Territory prior to the commencement of such year,Supplier shall have the right to terminate Distributor’s distribution rights hereunderfor any country where the parties do not agree to minimum performance levels;provided, however, the percentage increase in minimum performance levels for anyyear or country in the Territory will not be greater than seven (7) percent over theprevious year’s minimum performance level unless mutually agreed upon. Allother rights, terms and conditions in the Agreement for the remaining parts of theTerritory would survive the termination of any country.(c)* Reports:*Distributor agrees to submit regular reports to Supplier on aquarterly basis (unless otherwise agreed) accurately describing sales of theProducts by Distributor for the previous period (including prices, unit sales, andother information as may be reasonably requested by Supplier from time to time).(d)* Product Complaints.*Distributor agrees to report to Supplier all availableinformation concerning any product complaints that it is aware of. Thisinformation will be reported in order to assist Supplier in monitoring the qualityand safety of its Products, and to allow Supplier to meet its reporting obligationsunder the United States Medical Device Reporting regulations (21 CFR 803,24)and Medical Device Vigilance Guidelines. Information concerning productcomplaints may be reported to the Supplier in either verbally or in writing. A“product complaint’ is any written or oral expression of dissatisfaction as to theidentity, quality, durability, reliability, safety, effectiveness, or performance of aProduct. Product complaints associated with a death or serious injury, or amalfunction that could reasonably be expected to result in a death or serious injuryif the malfunction recurs, will be reported to Supplier immediately uponDistributor’s knowledge of that information.
 

 
(e)* Prohibited Sales:*Distributor agrees not to sell, and agrees to usereasonable efforts to ensure that Distributor’s subdistributors, agents andcustomers do not sell or use, any of the Products outside the Territory.(f)* Product Presentation:*Distributor agrees to present the Products fairly topotential customers, not to disparage the Products, any Product trademarks orSupplier and to do all things reasonable to promote the reputation of the Productsand the value of any Product trademarks.(g)* Advance Payment:*Distributor agrees to provide Supplier with anadvanced payment of two hundred fifty thousand dollars ($250,000) fullycreditable against Distributor’s future purchases of Products.(h) *Non-Compete:*Distributor agrees not to license, manufacture, sell, or distribute anyproduct, which competes with Supplier’s Products. Notwithstanding, Distributor reservesthe right to distribute percutaneous closer devices manufactured by Perclose, Inc. (anAbbott Laboratories company) in the Territory until Distributor sells any remaininginventory, provided however, Distributor sells any remaining inventory within ninety (90)days from the first date of this Agreement.**4.** **Obligations of Supplier:**   (a)** *Requirements of Distributor:*Supplier agrees to supply Distributor’srequirements for the Products in the Territory consistent with Distributor’s non-binding forecasts of its expected requirements for the Products. If Supplierbelieves it will not be able to satisfy Distributor’s requirements for the Products, itmust promptly notify Distributor, specifying the reasons for and duration of theexpected delay and its duration at the time Product order is placed.   (b)** *Registration and Marketing Support:*To assist Distributor in registeringand marketing the Products in the Territory, Supplier agrees to:(i) Provide Distributor with materials necessary to obtain health registrations.Supplier will supply to Distributor the required quantity of samples, at a priceequal to Supplier’s cost of goods, to obtain registration approval.(ii) Provide Distributor with information on marketing and promotional plans ofSupplier for the Products as well as copies of marketing advertising, sales,technical training manuals, and available audiovisual teaching and marketing aidesand promotional literature concerning the Products.
 

 
(iii) Provide Distributor with certain certificates of analysis concerning theProducts purchased by Distributor, certificates of free sale, trademarkauthorizations and any other documents which Distributor may require forregistration purposes.**5.** **Trademark License:**Supplier grants to Distributor the right and license to useSupplier’s trademarks and any trademark registrations which Supplier obtains anddesignates for the Products in the Territory, but only in connection with sales ofthe Products purchased from Supplier in the Territory. This trademark licenseshall continue in effect for each jurisdiction in the Territory only while Distributorretains its distribution rights in each jurisdiction. Distributor agrees not to removeor obscure any Product label affixed by Supplier. **6.** **Terms and Conditions of Sale:**   (a)** *Terms of Orders:*All purchases of the Products by Distributor fromSupplier during the term of this Agreement will be subject to the terms andconditions of this Agreement.   (b)** *Packaging:*All quantities of the Products purchased from Supplier byDistributor will be in the form of labeled, standard unit packages and in a form andformulation consistent with the Products sold by Supplier for use in the UnitedStates, unless otherwise agreed by Supplier and Distributor in writing.   (c)** *Price and Payment:*The prices for the Products to Distributor are set forthin Exhibit A attached hereto. The prices are valid for a minimum period of twelve(12) months, unless mutually agreed otherwise in writing. Ninety (90) daysadvance written notification is required for price increases by Supplier.   (d)** *Resale Price:*Distributor may resell Products at any price that Distributorin its sole discretion determines.   (e)** *Expenses:*All expenses for importation, promotion, sales and distribution,as well as Distributor’s administrative and overhead expenses, will be borne solelyby Distributor.   (f)** *Credit:*Distributor assumes all credit and other risks involved in its salesunder this Agreement. All collection expenses on sales made by Distributor will beat Distributor’s expenses.   (g)** *Payment Terms:*Basic payment terms are net sixty (60) days. **7.** **Product Warranty; Insurance:**Supplier warrants that all Products: (a) willconform with all specifications and descriptions thereof provided by Supplier, (b)will be free of defects in material, workmanship, and design, (c) will be of
 

 
merchantable quality, suitable for the purposes for which they are intended to be used, and(d) will comply with all applicable laws and regulations. Supplier will have the right to exchangeor accept existing inventory if Products do not meet requirements (a) to (d). All warrantiesshall survive any inspection, delivery, acceptance, or payment. Supplier will provide, whenrequested by Distributor, certification that to the best of its knowledge it isin compliance with U.S. laws, statutes, rules, regulations, and relevant orders relating to themanufacture, use, distribution, and sale of each Product. Distributor will use its best efforts toafford the Supplier the reasonable opportunity to inspect the allegedly defective Product at thelocation of its use or storage. Distributor will, or will cause, upon request and in accordancewith Supplier’s instruction, return of any defective Product to Supplier at Supplier’s cost. Anyreplacement of Products may be made by substitution upon mutual agreement.Supplier shall maintain in full force, and shall continue to maintain in full force for the termof this Agreement and five years thereafter, public and products liability insurance, namingDistributor as an additional insured, against bodily injury, death or property damage in any wayarising out of the design, manufacture, sale, distribution, or use of any Product in an amount ofnot less than US$5,000,000 per occurrence and annually in the aggregate. Said liability insuranceshall: (a) be written by an insurance company licensed to do business in theTerritory, reasonably satisfactory to Distributor;  (b) include (i) products liability coverage insuring 911 of the Productscovered by this Agreement, as amended, and (ii) contractual liabilitycoverage insuring the indemnification provisions of this Agreement;  (c) include a duty to defend and cover legal and defense costs as well asindemnity costs;  (d) include a separation of interests or cross liability clause such that thepolicy will respond on behalf of Distributor as if a separate policy hadbeen issued, except for the policy limits;  (e) include the Territory within the territory covered by the insurancepolicy.Supplier shall furnish Distributor with a copy of the insurance policy or a Certificate ofInsurance evidencing such insurance upon request of Distributor, provided that Supplier shallprovide such policy or such certificate upon execution of this Agreement and at least annuallythereafter. Said policy, or said certificate shall provide that the insurance evidenced thereby,shall not be canceled, terminated or materially reduced in coverage without at least thirty daysprior
 

 
written notice to Distributor. Failure to maintain the required insurance shallconstitute a material breach of this Agreement.**8.** **Indemnification:**   (a) Supplier agrees to indemnify Distributor and defend its employees, agents,representatives, and subdistributors harmless from and against, and to assume allcosts and expenses (including attorney’s fees) for:(i) claims or suits for bodily injury, including death, or property damagearising out of the design, manufacture, sale, distribution, resale, or useof any Product;(ii) any product recalls or replacements, whether required or recommendedby any government or other authority or organization or otherwise deemedappropriate by Supplier and Distributor, or(iii) any product liability claims arising from the Product Warrantyprovided by Supplier in Section 7,except if such injury, damage, cost, or expense is caused by the sole negligence ofDistributor.(b) Supplier agrees to further indemnify, defend, and hold Distributor, and itsemployees, agents, representatives, and subdistributors, harmless from and against,and shall assume all costs and expenses (including attorney’s fees) for any claimthat any Product infringes or violates any patent, copyright, trademark, tradename, trade secret, or other intellectual property right.(c) Supplier and Distributor each agree to indemnify and hold the otherharmless from and against any and all claims made by any person or entity arisingout of the processing, marketing, distribution, and sale of the Products, where andto the extent damages are alleged to have been caused by the fault of theindemnifying party or its employees or agents.**9.** **Confidential Information:**Each party agrees to keep confidential and not topublish or otherwise divulge or use for its own benefit or for the benefit of anythird party any information of a proprietary nature furnished to it by the other partywithout the prior written approval of the disclosing party, except as required bylaw or court order or as necessary for the marketing of the Products. Theconfidential information includes (but is not limited to) information concerningProducts, proposed products, marketing plans, methods of manufacture, customersand any other information or materials in whatever form. This obligation does notextend to information which: (i) is already known by recipient at the time of its
 

 
  disclosure to recipient; (ii) is publicly available or later becomes publicly availablethrough no fault of the recipient; or (iii) is disclosed to recipient by a third partyhaving no similar confidentiality obligation. This obligation shall terminate two yearsafter termination of this Agreement. **10.** **Term and Termination:**   (a) *Term and Renewal*: This Agreement commences on the date first set forthabove and will continue in force for an initial term of five (5) years. The partieswill be required to give notice to the other of its intention to terminate thisAgreement at least six (6) months prior to the expiration of the initial term hereofor of any renewal term.   (b) *Termination of Agreement*: Either party may at its option, terminate thisAgreement by giving to the other party not less than one-hundred twenty (120)days prior written notice, as applicable, if the other party at any time commits amaterial breach of any of its obligations hereunder and fails to correct any breachduring such 120-day notice period. This agreement also may be terminated byeither party if the other party becomes insolvent, makes or seeks to make anarrangement with or an assignment for the benefit of creditors, or if proceedings involuntary or involuntary bankruptcy are instituted by, on behalf of or against suchother party, or if a receiver or trustee of the other party’s property is appointed.   (c) *Termination of Agreement for Noncompliance with MinimumPerformance Levels*: If the Distributor fails to purchase the required minimumnumber of units of Products during any calendar year during the term of thisAgreement, Supplier may, if Distributor fails to cure such failure within six (6)months after receipt of notice thereof from Supplier, terminate this Agreementupon terms and conditions to be agreed upon between the parties; provided,however, Supplier can only terminate Distributor’s distribution rights for anycountry which fails to cure such failure. All other rights, terms and conditions inthe Agreement for the remaining Territory would survive the termination of anycountry.   (d) *Effect of Termination of Agreement*: Upon termination of this Agreement,Supplier may elect to (i) buy back all inventory on hand within sixty (60) days atDistributor’s “fully loaded cost” (defined as total cost incurred to import, registerand warehouse the Products, plus product promotion expenses) to Distributor or(ii) will allow the Distributor, and Distributor shall be authorized, to continue tosell the remaining inventory; provided, that in no event shall Distributor berequired to continue to sell or distribute Products after the termination of theAgreement. In addition, Distributor agrees to deliver to Supplier or destroy, uponrequest, all Product materials supplied by Supplier and all Product marketingmaterials of any kind. Distributor agrees to promptly assign or otherwise transferto Supplier or its designees all of Distributor’s rights, title and interest to
 

 
  registrations, regulatory approvals, licenses and/or pending applications for Supplier’sProducts. Supplier agrees to repay any remaining balance of the original Advanced Payment.The obligations of Supplier and Distributor pursuant to Sections 7 (Product Warranties), 8(Indemnification), 9 (Confidential Information), 10 (Term and Termination) and 11 (GeneralProvisions) of this Agreement will survive any termination of this Agreement. Nothingherein will limit any remedies which a party may have for the other’s default, except asexpressly provided herein. Neither party shall be liable to the other for any damage inconnection with that party’s termination of this Agreement by notice. **11.** **General Provisions:**   (a) *Governing Law*: This Agreement is to be governed by and interpreted inaccordance with the laws of the State of California, without regard to its rules onconflicts of laws.   (b) *Jurisdiction and Venue*: Each party submits to the exclusive jurisdiction ofany state or federal court located in Cook County, Illinois, U.S.A., over any suit,action or proceeding (“Action”) arising out of or relating to this Agreement or therelationship between the parties. Each party waives any objection to the venue ofany Action brought in such court and any claim that the Action has been brought inan inconvenient forum. Each party agrees that a final judgment in any Actionbrought in such court shall be conclusive and binding upon it and may be enforcedin any other courts to whose jurisdiction it may be subject.   (c) *Dispute Resolution*: The parties agree to use their best efforts to resolveany claim or dispute arising out of this Agreement through negotiation or, uponfailure of such negotiations, through such alternative dispute resolution (“ADR”)techniques as they may deem appropriate. However, nothing shall prohibit eitherparty from terminating its participation in ADR if it believes the dispute is notsuitable for ADR, or if ADR does not produce results satisfactory to it. If anyclaim or dispute is not resolved by negotiation or ADR, either party may, upongiving the other party at least fifteen (15) days prior written notice, initiatelitigation to resolve the dispute.   (d) *Entire Agreement*: This Agreement and subsequent agreements for theTerritory represent the entire agreement and understanding of Supplier andDistributor with respect to distribution of the Products, supersedes all previousagreements and understandings related thereto and may only be amended ormodified in writing signed by authorized representatives of Distributor andSupplier.   (e) *Assignment*:
 

 
(i) Neither Supplier nor Distributor may assign any of its rights or obligations pursuantto this Agreement without the prior written consent of the other party, except to asuccessor to substantially all of the business of either party by merger, sale of assets,or other form of reorganization.(ii) Distributor may resell the Products to, and appoint as its subdistributor(s) withinthe Territory, any majority owned subsidiaries or affiliates of Distributor’s corporateparent. The appointment of any subdistributor is conditioned upon:(A) Subdistributor expressly acknowledging that itsSubdistributor Agreement with Distributor is subject to andsubordinate in all respects to the terms and conditions of thisAgreement, and the Subdistributor further acknowledging that it isfamiliar with and will comply with all applicable terms of thisAgreement;(B) Distributor remaining directly responsible to Supplier for thedue performance of all obligations imposed on Distributor by thisAgreement, including payment for all purchases of Product; and(C) Prior written approval by Supplier. (iii) Supplier agrees to accept orders for shipment of Products into theTerritory only from Distributor or any Subdistributor.(f) *Notices:*All notices under this Agreement must be in writing and will be deemed given if sentby facsimile, telex, telecopier, or telegram (except for legal process in each case), certified orregistered mail or commercial courier (return receipt or confirmation or delivery requested), orby personal delivery to the party to receive the notice or other communications called for by thisAgreement at the following addresses (or at another address for a party as specified by a party bylike notice):   **Supplier** **Distributor**   Sutura, Inc. Getz Bros. & Co., Inc.17080 Newhope St. 225 W. Washington St., Suite 1900Fountain Valley, CA 92708 Chicago, IL 60606   Attn: President & CEO Attn: President, Medical Group(g) *Non-Hire:*Without the prior written consent of the other party, neither party shall,during the term of this Agreement or for twelve months thereafter, either directly or indirectly,hire or otherwise engage, or cause, aid or assist any other person or entity (including itssubsidiaries, parents or other affiliates) to hire
 

 
or otherwise engage, any current or former employee of other party for a period oftwelve months after the termination of such individual’s employment relationship withthe other party. This provision shall survive the termination of thisAgreement.(h) *Force Majeure****:***Each of the parties hereto will be excused from its performance ofits obligations hereunder if the performance is prevented by force majeure, and thatexcuse will continue so long as the condition constituting that force majeure continuesplus thirty days after the termination of the condition. For the purposes of thisAgreement, “force majeure” is defined to include causes beyond the control ofDistributor of Supplier, including without limitation acts of God, acts, regulations orlaws of any government, war, civil commotion, destruction of production facilities ormaterials by fire, earthquake or storm, labor disturbances, ormedical epidemics.           **SUTURA, INC.** **GETZ BROS.*****&*****CO., INC.**             By:    By:                     (printed name) (printed name)             Title:     Title:               
 

 
**EXHIBIT A**Products are defined as vascular closure products including but not limited to all and any newproducts developed within the field of vascular closure during the course of the exclusivedistribution agreement. The initial Products are:     **Product** **Unit Price (US$)**SuperStitch 6F $85.00      SuperStitch 8F $85.00      KnotPusher 6F To be agreed upon by the parties.     KnotPusher 8F To be agreed upon by the parties.     KwiKnot Tying Device To be agreed upon by the parties.
 

 
**EXHIBIT B****MARKETING PLAN/DATE REGULATORY PROCESS & APPROVAL/DATE****To be agreed upon by the parties.**
 

 
**EXHIBIT C****SALES TARGET AND FORECAST****Minimum Performance Levels**         **Year l** **Year 2** **Year 3**  4,500 units 5,500 units 6,500 units**Country-by-country minimum performance levels to be agreed upon by the parties.**