**Exhibit 10.27****DISTRIBUTION AGREEMENT**DATED: January 16,2006PARTIES:1. Sutura,Inc. (“The Company”) a Company incorporated in the State of Delaware, USA.2. The Lifemed Group Inc. (The Distributor) a Company incorporated in Canada having its registeredoffice at 40 Eglinton Avenue East, Suite 307, Toronto, Ontario M4P 3A2.WITNESSETHWhereas, Sutura Inc. manufactures, markets and sells vascular stitching devices, whereas theDistributor represents that it has the knowledge and skills to market Sutura Ine.’s products andintends to purchase Sutura Inc.’s products for sale inCanada.AGREEMENTThe parties hereby agree as follows: 1. In this agreement where the context so admits or requires the following expressionsshall have the following meanings respectively:       “The Company’s Products” means such products as the Company is prepared to supply tothe Distributor upon the terms of this Agreement. Suchproducts are initially those described in the price listcontained in the first schedule hereto but the companymay, from time to time by reasonable notice in writing tothe Distributor for good reason, add other products ordelete products.       “The Territory” Canada       “The Patents” means the registered patents andapplications therefore for thetime being registered in the name of or, as the case maybe applied for, by Sutura Inc., itssubsidiaries/parent/holding or associated companies andany future patents granted to or applications madetherefore by or on behalf of Sutura Inc.       “The Trade Marks” means the registered trade marks and applications thereforefor the time being registered in the name of, or as thecase may be, applied for by Sutura Inc. or itssubsidiaries/parent/holding or associated companies andany future trade marks and applications thereforeregistered in the name of or applied for by Sutura Inc. orits subsidiaries/parent/holding or associated companies.       “The Trade Names” means the unregistered trade names belonging to the Company       “The Commencement Date” means February 1, 2006The singular includes the plural and vice-versa, words imparting the masculine gender onlyshall include the feminine gender and words imparting persons shall include corporations.DISTRIBUTOR’SRIGHTS AND OBLIGATIONS
 

 
2. The Company hereby grants to the Distributor during the term of this Agreement and theDistributor hereby accepts subject to the provisions hereinaftercontained, the right topurchasefrom the Company, the Company’s Products for resale within the Territory. 3. The Distributor agrees:   Sales (1) At its own expense to promote and increase in every reasonable mannerpossible to the reasonable satisfaction of the Company the sale of the Company’s Products in theTerritory and to purchase from the Company in each period of 12 (twelve) months,beginning on the commencement date, Company Products to a total value of at least thevalue stipulated in the second schedule hereto or such other value as shall be agreedfrom time to time in writing.  (2) To keep the Company informed of all its marketing activities withregard to the Company’s Products and also of any developments in market conditions within theTerritory and to submit a bi-annual Marketing Report.  (3) Not to seek customers or otherwise directly or indirectly to solicit ordersfor the Company’s Products outside the Territory or knowingly sell to a third party who intendsto sell the Company’s Products outside the Territory.  (4) To comply with or, as the case may be, to assist the Company to complywith any procedure or regulation laid down or imposed by any governmental body or agencywhich affects any of the Company’s Products within the Territory.    The Distributor agrees that in carrying out its duties under this Agreement, it willneither undertake nor cause or permit to be undertaken any activity which is illegalunder any laws in or outside the Territory. In particular, the Distributor covenantsand warrants that it shall comply in all respects with all laws, decrees, rules andregulations of the Territory. The Distributor warrants thai it is duly licensed orotherwise authorized by all laws applicable in the Territory and accepts all liabilityfor breach of this warranty.  Conflict of Interest (5) That it shall not during the subsistence of this Agreement without thewritten consent of thc Company be interested in or concerned either directly or indirectly in thepurchase, sale, manufacture or introduction into the Territory of any goods which compete with orperform the same function as any of the Company’s Products.  (6) Subject to the provisions of Clause 3 (7) hereof during the term of theAgreement and at its own expense to advertise the Company’sProducts throughout the Territory to such anextent and in such a manner as is reasonably satisfactory to the Company.  (7) Not to produce, exhibit, circulate or permit any servant or agent to produce,exhibit or circulate any literature or advertising material other than that supplied to it underClause 4(4) thereof, without the prior written approval of the Company.  Service (8) To carry out after-sales service and follow-up sufficient for return purposes,for any of the Company’s Products to a standard of the workmanship reasonablyacceptable to the Company and to provide itself at its own expense with such properequipment and facilities as shall, in the Company’s reasonable opinion, be adequatefor this purpose.  Stocks and Staff
 

 
 (9) To maintain such stocks of the Company’s Products, including, as appropriateand as may be reasonably necessary to enable the Distributor to comply with itsobligations hereunder.  (10) To employ such qualified, trained sales and technical personnel as shall be necessary toprovide for the proper sales, service, and follow-up of theCompany’s Products.  Payment (11) To pay for the Company’s Products in such a manner as the Company may from time totime prescribe and at the applicable prices specified in the Company’s price listcurrently in effect upon receipt of the Distributor’s order,less the discount mentioned in thefirst schedule herein or as otherwise agreed in writing between the Company and theDistributor and to pay all charges involved in transferring payments in full and not tohave the amount due to the company exceeding the limit as established from time to timeby the Company.  Industrial Property Rights and Confidentiality (12) Not without the consent in writing of the Company to use or permit the use of any ofthe Company’s Patents, Trade Marks or Trade Names either during the term of thisAgreement or any continuance thereof, or at any time thereafter, except for the purpose ofselling the Company’s Products under this Agreement. The Distributor must ensure thateach reference to and use of the Trade Marks or Trade Names by the Distributor is in amanner approved by Company and, where appropriate, is accompanied by anacknowledgment, in a form approved by Company, that the same is a registered trademark of Company.  (13) Not to effect or permit the removal of, or any alteration or addition to any of thePatent numbers or serial numbers affixed to any of the Company’s Products without priorwritten consent of the Company.  (14) Not to use any of the Company’s Trade Marks or Trade Names or any word or wordsclosely resembling them or any of them as part of any corporate name and not to use theTrade Marks or Trade Names in any way which might prejudice the validity ofCompany’s goodwill in them.  (15) To keep confidential and safeguard with special care all confidential technicalinformation, know-how, data and specifications relating to the Company’s Products ortheir manufacture supplied to it by the Company and not to use or disclose the same toany third party without the prior written consent of the Company except to the extentnecessary to enable its employees to carry out their duties; and to take all necessarysteps to ensure that its employees become bound not to use or disclose the same except asaforesaid.  (16) Not to modify, alter or add to any of the Company’s Products without priorwritten consent of the Company and to disclose to the Company full details of any suchmodifications, alterations or additions carried out on receipt of such approval.  (17) At Company’s expense, the Distributor will take all steps which Company reasonablyrequires to assist in maintaining the validity and enforceability of the Company’sexclusive rights to the use of the Patents, Trade Marks or Trade Names during the term ofthis Agreement. The Distributor must not do, omit or permit the doing or omission of,anything which might invalidate or be inconsistent with the Company’s rights in thePatents, Trade Marks or Trade Names.
 

 
 (18) The Distributor must promptly and fully inform Company if theDistributor becomes aware of: (a) any actual, threatened or suspectedinfringement of the Company’s rights in the Patents, Trade Marks or Trade Names;and (b) any claim that the sale of the Company’s Product infringes any rights ofany Other person.THE COMPANY’S RIGHTS AND OBLIGATIONS 4. The Company agrees during the period of this Agreement:   Sales (1) Subject to the provision of Clause 5 (3) hereof, not during the term of theAgreement, or any continuance thereof, to appoint any other person as distributor of the Company’sProducts within the Territory nor to authorize any person to sell the Company’s Products withinthe Territory.  (2) Subject to the provisions of Clause 3(12) to 3(18) hereof, to permit theDistributor to use the Patents, Trade Marks and Trade Names for the purpose of selling the Company’s Productsin accordance with the terms of this Agreement.  (3) Subject to the provisions of Clause 6 (6) hereof, to sell the Company’sProducts to the Distributor at the Company’s prices from time to time current for sales to itsdistributors, specified in the Company’s price list(s) current at the date of delivery less thediscount.  Advertising Materials and Catalogues  (4) To supply the Distributor with the instruction books, catalogues, circularsand other promotional and advertising material in such quantities as the Company deems necessaryand to the extent that the same are reasonably available. *5.* The Company at its sole discretion may:DesignChanges(1) Improve, discontinue or replace any of the Company’s Products at any time withoutincurring any obligation to replace or make corresponding changes in any of the Company’s Productspreviously delivered to the Distributor and without incurring any other obligation orliability provided such improvement, discontinuation or replacement applies to all Companydistribution.Application of Funds(2) Apply or procure to he applied from time to time any funds of or credits to theDistributor in the possession or custody of the Company against any debts of the Distributor owing to theCompany.Adequate Representation/Participation(3) By not less than 60 day’s notice in writing to the Distributor to withdraw the sellingrights granted to the Distributor in respect of any part of the Territory if the Distributor failsto give representation reasonably acceptable to the Company in such part, and appoint forthwith anyother person as Distributor in respect of such part, Service of notice as aforesaid shall bewithout prejudice (a) to the validity of this Agreement in respect of those parts of the Territorynot being the subject of the said notice and (b) any rights as to the payment of money or to theprovision of service or repair in respect of any Company Product supplied hereunder accruing to eitherparty prior to the date thereof in respect of such part.
 

 
The Company at its sole discretion may sell directly or permit any subsidiary, parent orassociated company of the Company or any other party to sell directly any of the Company’s Productsto government agencies within the territory. However, in case of direct selling by any referencedparty, the Company shall pay to the Distributor an amount equal to the difference between the saleprice to the customer and the Company price to the Distributor. The Distributor price of suchProduct will be referenced on the price list current at the date upon which such order wasaccepted.Assignment(4) The Company may assign to any subsidiary, parent or associated company of the Company or to anyother party its rights made under this Agreement or the benefit of any term or provision hereof.ORDERSAND CONDITION OF SALE6.The following provisions shall apply to any order that the Distributor places for any ofthe Company’s Products:Placingan Acceptance of Orders (1) All orders must be addressed by the Distributor to the registered officefor the time being of the Company or to such other address as the Company shall notify to theDistributor.  (2) An order addressed to the Company shall not be deemed to have been accepteduntil a formal written acceptance has been dispatched to the Distributor by the Company.  (3) All orders shall be placed upon and subject to the terms and conditions ofthis Agreement and shall be deemed to be accepted upon and subject to such terms andconditions to the exclusion of all other conditions of sale or purchase. If anypurchase order or acceptance of order shall make any reference to any standard orprinted or other terms and conditions of purchase or sale, such order and acceptanceshall be construed and the rights and liabilities of the parties respectively shall beascertained as if such reference had been deleted.Warranties  (4) The Company warrants that all the Company’s Products supplied to the Distributorwill be of the standard quality normally supplied by the Company. The Companydoes not give any warranty in respect to the Company’s Products except for theforegoing warranty which is given expressly in lieu of and to the exclusion of allother warranties and conditions expressed or implied whether under law or otherwiseand also to the exclusion of every form of liability for loss or damage direct orconsequential. The Company does not accept any liability under the foregoingwarranty or on any other grounds for damages in an aggregate amount greater thanthe Company’s price to the Distributor for the Company Product involved.  (5) The Company hereby warrants that itself or its subsidiaries, parent,holding or division companies are the registered proprietors of the Patents and Trade Marks butno other express or implied warranty is given by the Company with respect to thevalidity of any of the Patents or Trade Marks.Prices and Payment
 

 
 (6) The Company reserves the right to alter from time to time the prices of theCompany’s Products stated in the Company’s price list by giving to the Distributor atleast 60 day’s notice in writing to that effect. Where any of the company’s productsare on order but remain undelivered at a time when the Company notifies theDistributor of any alteration in the price thereof, they will be delivered at theprices in effect at the time the order was received by the Company, unless agreed to thecontrary by the Company.  (7) The Distributor will pay for all orders of the Company’s Products in USdollars or in such other currency as the Company shall specify, and all such payments are due netwithin thirty (30) days from the date of shipment and invoicing after the initial six(6) month period in which all orders shall be prepaid.  (8) The Company’s prices are for delivery ex the Company’s warehouse at Sutura,Fountain Valley, USA. Delivery shall be deemed for all purposes to take place andthe risk of loss shall be deemed to have transferred to the Distributor when theCompany’s Products leave the Company’s warehouse and are delivered to theDistributor, his servant or agent or to the carrier or other bailee for the purpose oftransmission to the Distributor. If the Company agrees to the request of theDistributor to arrange transport and/or insurance, the Company shall be deemed to doso as the agent for the Distributor and at the Distributor’s expense in all respects.In such event, the Company shall not be responsible in any manner whatsoever to theDistributor either in negligence or otherwise for any failure on the part of theCompany to comply with such request correctly or at all.  (9) The Company shall be entitled to withhold delivery of any goods ordered bythe Distributor for so long as payment for any goods previously delivered hereunder isoutstanding and in default and/or credit limits are exceeded.Title and risk in the goods (10) The risk of goods ordered by the Distributor will be transferred to theDistributor upon delivery, but the ownership of such goods will only be transferred tothe Distributor when it has paid all amounts owed to the Company, no matter on whatgrounds such amounts are owed. The Company shall not be responsible for failure ordelay in delivery of any of the Company’s Products to the Distributor, and the Companyreserves the right to make delivery by installments or partial deliveries with respectto any order placed by the Distributor which the Company is unable to make in onedelivery.GENERAL CONDITIONS 7. The following general conditions shall apply to this Agreement: (1a) All disputes arising in connection with the present contract shall be settledamicably, Failing this, the dispute shall be referred to the Jurisdiction ofCalifornia Courts.  (1b) The provisions herein contained shall be construed and take effect in accordancewith USA law.  (2) This Agreement is personal to the Distributor, which may not assign thewhole or any part of its rights or obligations hereunder without the Company’s prior writtenconsent.  (3) The Distributor acknowledges that the relationship between itself and the Companyis that of buyer and seller, and agrees that it will not represent itself to be theagent of
 

 
    the Company for any purpose whatsoever, that *i *will not pledge the credit of theCompany and that it will not incur any other obligation on behalf ofthe Company.  (4) The parties hereto acknowledge that this Agreement does not constitute apartnership or joint venture between them.  (5) No departure from or waiver of the provisions of this Agreement shall bedeemed to authorize any prior or subsequent departure or waiver, and the Company shall not beobliged to continue any departure or waiver or to permit any subsequent departure orwaiver.  (6) Notwithstanding that any of the provision of this Agreement may prove to beillegal or unenforceable, the remaining provisions thereof shall continue in full force andeffect, provided that such severance is permitted under US law.  (7) No rights to manufacture the Company’s Products are granted to theDistributor by this agreement.  (8) The headings to clauses and paragraphs of the Agreement are inserted for thepurpose of convenience only and shall not affect the construction of thisAgreement.TERMINATION 8. (1) This Agreement shall be deemed to have effect fromthe commencement date andsubject to the provisions of clause 5 (3) hereof and as hereinafter provided shall remainin force for a period of three years from that date and thereafter from year to yearunless terminated by either party giving to the other not less than 6 months writtennotice of its intent that the Agreement shall expire at the end of the then current term. (2) Notwithstanding the provisions of Clause 8 (1) hereof, this Agreementmay be terminated immediately: (a) upon written notice to the other party if that otherparty shall suspend payment or become insolvent or suffer a receiver or trustee of any of itsproperty to be appointed for the benefit of creditors of that other party.  (b) upon written notice to the other party if that otherparty shall commit any material breach of any of its obligations hereunder and shall fail to remedysuch breach within 28 days after being called upon to do so by notice inwriting given by the party not in default.  (c) upon 28 days written notice from the Company to theDistributor if the latter fails to realize the sales volume minimum purchaserequirements mentioned or referred to under Clause 3(1).  (d) upon written notice from the Company to the Distributor. 1. In the event of the assignment or attempted assignment by Distributorof all or any of its rights or obligations hereunder without theprevious written consent of the Company  2. If any change occurs in the constitution or circumstances of theDistributor which, in the opinion of the Company, is materiallydetrimental to the interests of the Company and, without limiting thegenerality of the foregoing, if any interest in the Distributor isacquired, directly or indirectly, by any other company, person, firm orassociation
 

 
   engaged in any business which, in the opinion of theCompany, competes or will compete with the business of theCompany. (3) Upon the effective date of any such notice of termination, the Companymay then appoint, accept orders from and deliver to customers in the Territoryafter the effective date of such termination and no allowance shall be payableto the Distributor in respect to the Company’s Products delivered to the newdistributor.  (4) In the event that the Company is acquired by or merged with another company,theCompany has the right to terminate the distribution agreement before the end of thecontract period. If the distribution agreement is terminated due to acquisition ormerger prior to the end of the contract period, the Company will compensate theDistributor for the loss of future margin over the remaining term of the contract to amaximum of 12 months. The compensation to the distributor will be calculatedbased on the average level of units sold in the six months preceding the terminationtimes a margin of 50 Dollars.  (5) In the event that the company is acquired by or merged with another companywithinthe first six months of the distribution agreement, the Company will provideliquidating damages to the distributor. The amount of liquidating damages, will bebased on the following formula:       distributor’s year one unit purchasing commitment     X      50 Dollars   2        (1000/2) X 50 Dollars =       500 units X 50 Dollars = Dollars 25,000