exv10w43





Exhibit
10.43



OEM SUPPLY AND PURCHASE AGREEMENT




     This OEM Supply and Purchase Agreement (“Agreement”) is made as of March 31, 2005 by and
between Nihon Kohden Corporation, a Japanese Corporation with its principal offices at 31-4
Nishiochiai 1-chome, Shinjuku-ku, Tokyo 161-8560 Japan (hereinafter referred to as “NK”), and
Cardiac Science Inc., a Delaware Corporation with its principal offices at 1900 Main Street,
Irvine, California, USA 92614 (hereinafter referred to as “CSI”) (NK and CSI each being a “Party”,
and collectively the “Parties”).



RECITALS




          CSI is a manufacturer of various medical devices including automated external defibrillators
(“AEDs”) and certain technology components such as High Voltage Circuit boards and User Interface
Circuit Boards used in the manufacture of AEDs which contain CSI proprietary AED technology,
including, but not limited to CSI’s RescueReady®, STAR® biphasic and
RHYTHMx® analysis software AED referred to collectively as (“Circuit Boards” or
“Products”) as defined in Appendix 1 below which, among other things, externally defibrillate a
human heart.




          NK develops, manufactures, distributes and sells various medical devices and systems
including patient monitoring systems and external defibrillators.




          NK desires, in collaboration and with the assistance of CSI, to develop an AED device that
is appropriate for sale to consumers. To achieve this goal, NK desires to purchase certain AED
parts referred to herein as (“Parts”) as defined in Appendix A directly from certain other
vendors and NK desires to purchase from CSI, and CSI desires to sell to NK, certain Products as
defined above and in Appendix 1, and Replacement Electrodes made by CSI for incorporation into an
AED device referred to hereafter as (“AED 1x”) to be manufactured by NK for sale under one or
more of NK’s trademarks or brand names.




          The AED 1x product containing the CSI Products sold under the NK trademark or brand name
will be sold exclusively by NK on a worldwide basis both inside and outside the Japanese domestic
market.




          NOW THEREFORE, in consideration of the mutual promises and covenants hereinafter contained,
and other consideration the receipt and sufficiency of which is hereby acknowledged, it is hereby
agreed between the parties as follows:




TERMS AND CONDITIONS




1. GRANT OF RIGHTS




     1.1 License. Subject to the terms of this Agreement, CSI grants to NK the
nonassignable and non-transferable right and license to:



          (a) Resell and sub-license the NK-branded AEDs containing the Products to End-Users or
to other third parties for sale;



“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”




 









 








          (b) Resell and sub-license the Replacement Electrodes to End-Users or to other third parties
for sale.




          (c) Use CSI Marks, if necessary, in connection with the marketing, resale and sublicensing of
Products, pursuant to CSI’s prior written approval, such approval not to be unreasonably withheld;
and




          (d) Resell and sub-license the Products as provided herein under NK’s own Marks and using
NK’s own labeling and packaging; provided, however, that NK maintains all CSI Marks and other
proprietary notices contained on the Products.




     1.2 Enforcement. NK shall enforce its obligations under this Agreement with respect to
sublicenses granted by NK pursuant to this Agreement and, upon the request of CSI, shall enforce,
at NK’s cost, the rights of CSI with respect to any such sublicense and shall cooperate with CSI,
at NK’s cost, in any action by CSI to enforce its rights with respect to any such sublicense,
including by providing to CSI all information and assistance that CSI considers reasonably useful
to pursue such action. NK’s sale, distribution or other transfer of Products to a distributor or a
third party for resale to an End-User shall not prevent CSI from enforcing its rights pursuant to
this section.



     1.3 Reservation of Rights. Except as expressly provided herein, CSI does not grant to
NK any license or Intellectual Property Rights, whether by implication, estoppel or otherwise in
and to the Products, CSI Marks and CSI Confidential Information. NK shall not: (a) reverse
engineer, decompile, or otherwise tamper with the Products; (b) permit any third party including
distributors or End Users to do any of the foregoing.



2. SCOPE OF THE OEM SUPPLY AND PURCHASE AGREEMENT




     2.1 For the term of this Agreement, on the terms and conditions provided herein, CSI agrees
to sell and NK agrees to purchase the Products more closely specified in Appendix 1 hereto in such
quantities as NK orders from time to time pursuant to Section 3.



     2.2 CSI shall supply to NK Products that conform to the technical specifications defined in
Appendix 3 hereto and in accordance with the warranty in Section 9.1.



     2.3 Parties shall cooperate and provide to each other in a timely fashion all information
necessary to facilitate the OEM version of the AED 1x.



     2.4 NK agrees to pay CSI for any and all non-recurring engineering (“NRE”) costs and other
expenses associated with any modifications to the Products requested by NK including but not
limited to any modifications to the internal electronics, software or interfaces of the Products.
The Parties will agree in advance as to the nature and the amount of the NRE costs and expenses
associated with the aforementioned modifications.



     2.5 For convenient reference, each of the capitalized terms used in this Agreement is defined
in Appendix 4.



“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”




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3. TERM AND TERMINATION




     3.1 Duration. This Agreement becomes effective as of the Effective Date and continues
in full force and effect, unless sooner terminated as set forth below, until December 31, 2008 (the
“Term”), with an automatic one (1) year renewal (the “Renewal Term”) unless either party provides a
ninety (90) day prior written notice of its intent not to renew the Agreement.



     3.2 Termination. Either party (the “terminating party”) may immediately terminate
this Agreement upon notice to the other in the event that the other party: (a) breaches any
material term of this Agreement, including the obligation to pay amounts due under this Agreement
and such breach is not cured within thirty (30) days after notice from the terminating party; or
(b) immediately upon written notice to the other party in the event that proceedings in bankruptcy
or insolvency are instituted by or against the other party, or a receiver is appointed, or if any
substantial part of the assets of the other party is the object of attachment, sequestration or
other type of comparable proceeding, and such proceeding is not vacated or terminated within
thirty (30) days after its commencement or institution



     3.3 Effect of Expiration or Termination. Upon any expiration or termination of this
Agreement, the following provisions apply:



          (a) NK will promptly remit to CSI all money due as of the date of expiration or termination;
and if CSI terminates this Agreement pursuant to Section 3.2(a), then NK shall reimburse CSI for
its actual costs of raw materials and components used to manufacture the Products which CSI has
procured in order to supply the Products anticipated by this Agreement, and all work-in-process
related to such Products; provided, however, that (i) NK shall only be required to reimburse CSI
for such volume of raw materials, components and work-in-process that CSI reasonably determines is
unable to utilize for any reasonable period in products other than the Products; and (ii) the
amount of any such reimbursement shall be reduced by any refunds that CSI is able to obtain upon
making reasonable efforts to return such raw materials and components to the vendors thereof. In
the event of termination of this Agreement NK may sell and sublicense the Products existing in its
inventory at expiration or termination;




          (b) NK shall have no further right to use CSI’s Marks and shall return all promotional
materials that contain CSI Marks to CSI;




          (c) NK promptly shall return to CSI all CSI Confidential Information in NK’s possession. NK
shall be entitled to retain, however, copies any data and information that NK may be obligated to
retain for Quality Control and warranty purposes and/or the requirements of any government agency
or applicable law.




          (d) CSI shall continue to supply Licensed Replacement Electrodes to NK for at its standard
published dealer prices under such terms that are mutually agreeable to the parties and NK shall
have a right to keep providing sales support for the Product to end users customer after
expiration and/or termination of the Agreement.



“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”





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          (e) NK shall not by reason of the termination or expiration of this Agreement in accordance
with its terms be liable to CSI for compensation, reimbursement or damages on account of lost
prospective profits or anticipated sales, or on account of expenditures, investments, leaves or
commitments by CSI or on any other account.




4. NK OBLIGATIONS




     4.1 Applicable Laws.



          (a) NK shall comply with all applicable laws, rules and regulations in all of its activities
relating to this Agreement including the U.S. export laws, and to the marketing, sale, lease,
license, promotion, distribution, export, import and transfer of the Products, including without
limitation, obtaining any and all registrations and licenses required for the operation of NK’s
business and the marketing, sale, lease, license, promotion, distribution, export, import and
transfer the Products.




          (b) NK shall be solely responsible for and agrees to provide, in connection with the sale,
offer to sell, license, lease, import, export, transfer or distribution of Products, such
labeling, manuals, or other information as may be required by applicable Japanese Ministry of
Health and Welfare (JMHW) approvals and laws, including but not limited to instructions, warning
and preventions.




     4.2 Documentation and Models. NK shall provide CSI with one copy of the operations
manuals for each AED 1x model sold under NK’s trade name. When a manual is revised, a copy of the
revised manual will be provided within 30 days after the revised manual is first issued.



     4.3 Responsibility. NK shall be jointly and severally liable to CSI for the actions
and omissions of its officers, employees, agents, directors, representatives, distributors,
sub-dealers, End-Users and other sublicenses with respect to performance under any license or
sub-license granted or authorized hereunder or related to the subject matter thereof.



5. CSI OBLIGATIONS




     5.1 Supply. CSI shall provide Products to NK pursuant to the terms and conditions
specified herein. Notwithstanding the foregoing, CSI shall be relieved of the obligation to supply
such Products in the event that any of the following circumstances occurs: (i) a third party
claims that any of the Products infringes or misappropriates its intellectual property; and (ii)
any product recall involving any of the Products. CSI shall not be required to provide any direct
support to End-users unless mutually agreed upon by CSI and NK in writing.



     5.2 Modifications. NK may request modifications to the Products, which would result
in a deviation from the description of the Products in the Technical Specifications which is
specified in Appendix 3; provided such a request is made at least ninety (90) days prior to the
desired effective date of such modification. The parties shall negotiate in good faith any such
requested modification, including any related amendments to this Agreement to provide for
reimbursement for any non-recurring costs that CSI will incur to effect such modifications and any
adjustments to the prices hereunder to reflect any increased costs of manufacturing the



“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”




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Products as a result of such modification. If the parties are unable to agree upon such requested
modification and related amendments to this Agreement within such ninety (90) day period, this
Agreement and the Document shall continue in effect without change;



     5.3 Development (Software Modification). CSI shall use commercially reasonable
efforts to support any mutually agreed upon modifications and deliver Products to NK no later than
the end of the second quarter of 2005, pursuant to NK’s purchase order.



     5.4 Bill of Materials and Parts. CSI agrees to provide NK with schematics and a
listing of the bill of materials referred to hereafter as (“Parts”) that may be required to
complete the manufacture and assembly of the AED 1x. For the sake of clarity and the avoidance of
doubt, these Parts do not include the Products as defined in Appendix 1 whose specifications are
outlined in Appendix 3. CSI shall provide NK with the cost of Parts, along with the original
manufacture’s name, address, contact name and provide authorization to CSI’s vendors to allow NK to
procure these Parts at the same transfer price offered to CSI.



     5.5 CSI Product Changes. CSI shall inform NK about any material changes of
specification or any other material changes to the Products at least 180 days prior to their
implementation. If any proposed modification might affect the performance, quality or functioning
of critical components of Products or the approvals, permissions, consents or licenses applicable
to them, CSI shall not modify the Products unless NK has given its consent to the modification in
writing. If NK gives its consent to the proposed modification, the modified Products shall replace
the prior version of the Products and the terms and conditions of this Agreement shall continue to
apply. If the modified Products are not acceptable to NK, CSI shall, if feasible, continue to
deliver to NK unmodified Products. Concerning the Electrodes, if the modification relates to a
change in the gel material, CSI shall provide NK with the modification notice and biocompatibility
data at least 180 days prior to the proposed date of shipment of the modified Electrodes.



     5.6 Out of warranty service. With respect to out-of-warranty product returns, CSI
shall agree to repair the out of warranty Product for a period of at least seven (7) years from
the date of delivery by CSI of the Product. NK shall contact CSI and inform CSI of the relevant
information and request a returned goods authorization and upon approval by CSI, CSI shall give a
return authorization number within two (2) days from receiving request from NK. As promptly as
possible, but not later than ten (10) working days after CSI’s receipt of the defective Products,
CSI shall to the extent possible, repair the defective Product. CSI shall provide a report
together with any product being returned. Each Party shall bear own shipping costs. Title and risk
of loss or damage to the product shall pass to the other party upon delivery to the other party’s
carrier. CSI shall apply it standard service rate to out of warranty repairs, unless the cost of
repair is estimated to exceed $200. In such cases, NK shall have the right to approve in advance
the nature and the amount of the repair costs and expenses associated with the out of warranty
Product requiring repairs



     5.7 Product Discontinuation. If CSI plans to discontinue manufacturing of any of the
Product from its product line, it shall notify NK about the intended removal in writing at least



“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”




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240 days in advance. CS will make its best commercial effort to provide substitute product if
Product, as defined in Appendix 1, is discontinued.



     5.8 Spare Parts. CSI will make best effort to make compatible spare parts available
on reasonable commercial terms for a period of at least [*] from the delivery by CSI
of the Product in question. NK understands that there may be no spare parts for the Products other
than the Products themselves or their replacements. Accordingly, in such cases where spare parts
are reasonably required for necessary repair of such Products, CSI shall replace the Product in
question with replacements that are reasonably acceptable to NK and on reasonable commercial
terms.



     5.9 Applicable Laws and Regulations. CSI shall manufacture the Products in compliance
with FDA, ISO 9001, the MDD (the Counsel Directive 93/42/EEC concerning medical devices promulgated
by the Counsel of the European Communities as amended) and all other applicable laws and
regulations. CSI support and assist NK by providing relevant documentation necessary to seek
regulatory clearances and approval for the Products including JMHW, and will assist NK’s efforts to
the extent reasonably necessary, in obtaining any regulatory approvals necessary for the use of the
Products.



     5.10 CSI Notification. Notification of quality control and assurance from CSI to NK
shall be as set forth in Appendix 5. CSI will indemnify and hold NK harmless from and against any
and all direct damages sustained as the result of CSI’s failure to provide timely notice of Product
failure or defect as detailed in the Appendix 5.



6. ORDERS



Unless expressly otherwise agreed, all sales under this Agreement shall be between CSI as seller
and NK as purchaser.




     6.1 NK shall submit to CSI periodic forecasts every month of its anticipated requirement of
the Products for the subsequent five (5) month period. The purchase forecasts are not binding on
NK. The forecasts shall be provided in good faith. CSI shall notify NK of any inability as a result
of causes beyond CSI’s control (i.e. Force Majeure) to supply according to NK’s forecasts no later
than four (4) weeks prior to the forecast date of shipment and in such case shall inform NK of the
maximum amount it is able to supply and its shipment schedule



     6.2 NK shall order Products from CSI by issuing written purchase orders. Purchase orders (a)
for the Products as defined herein High Voltage Boards and User Interface Circuit Boards containing
the CSI proprietary technology together shall be issued at least thirty (30) days in advance of the
requested shipment date. Purchase orders for Electrodes shall be issued at least fifteen (15) days
in advance of requested shipment date.



     6.3 In order to initiate the Agreement, NK shall order the following Circuit Board and
quantities from CSI:



“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”




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	Item to be ordered	 	Minimum Opening Order Quantity
	Products  — High Voltage Boards and User
Interface Circuit Boards containing the CSI
proprietary technology together

	 	250 (two hundred and fifty)






     6.4 Unless otherwise agreed between the Parties, NK may reschedule in writing, delivery
of any Product on purchase orders with CSI within the following guidelines:



	 	 	 
	Days from Scheduled Shipment Date	 	Allowed Changes
	Products — Circuit Boards [*] days

	 	No changes
	Products — Circuit Boards [*] days

	 	[*] percent (plus or minus)
	Products — Circuit Boards [*] days

	 	[*] percent (plus or minus)






	 	 	 
	Days from Scheduled Shipment Date	 	Allowed Changes
	Electrodes [*] days

	 	No changes
	Electrodes [*] days

	 	[*] percent (plus or minus)
	Electrodes [*] days

	 	[*] percent (plus or minus)






     6.5 Every purchase order given by NK will be deemed to be a separate purchase contract
under the terms of this Agreement. Cardiac Science may at its sole discretion refuse to accept
or may cancel any outstanding purchase order in the event that any of the following
circumstances occurs: (i) CSI determines or a third party claims that any of the Products
infringes or misappropriates its intellectual property; and (ii) any product recall or similar
corrective action involving any of the Products which is required to be reported under the FDA’s
Medical Device Reporting requirements such as 21 CFF Part 803.



7. DELIVERIES




     7.1 Delivery and Shipping. Unless expressly otherwise agreed in writing, all orders
shall be delivered by CSI EXW Minnetonka. MN, or some other location of CSI’s choosing,
interpreted in accordance with INCOTERMS (2000 Edition). CSI shall use its commercially
reasonable efforts to ship the Products with test reports in time for them to arrive by delivery
dates agreed upon in compliance with the ordering procedure described herein. CSI shall notify



“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”




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NK of any anticipated delivery problems in advance, but CSI shall not be responsible for any loss
or liability suffered by NK as a result of delay in delivery or replacement of any order. NK
agrees, however, that for shipments destined to locations outside the U.S., where transit time is
expected to take more than one week, the minimum lead time for orders may be appropriately
increased by CSI to reasonably account for such additional transit time. Title and risk of loss to
Products purchased under this Agreement shall pass to NK upon delivery thereof to the carrier.



     7.2 Packaging. Unless NK specifies otherwise, deliveries of the Products shall be
made in CSI’s standard delivery containers, which are reasonably designed to avoid damage during
delivery and inventory phases. Delivery shall be made to such address as NK specifies in a
purchase order. NK shall pay reasonable costs of any special packaging that it requires.



     7.3 Taxes. Except as expressly stated otherwise, prices set forth herein do not
include any existing or future taxes, tariffs, fees, duties, assessments or other charges (other
than income taxes assessed on CSI) that may be applicable to the Products supplied to NK pursuant
to this Agreement. If such additional sums are required to be withheld, collected, or paid, then
CSI shall add them to the price payable by NK.



     7.4 Acceptance upon Shipment. All sales of Products to NK shall be deemed accepted
upon shipment by CSI and title to the Products shall pass to NK upon delivery to NK’s carrier.



     7.5 Non-conforming Products. NK shall inspect Products, based on the criteria for
incoming inspection which shall be separately and mutually agreed to by CSI and NK, promptly
determine if any of the Products are non-conforming. Upon reasonable request, CSI shall provide
reasonable assistance to NK in order to determine whether any of the Products are nonconforming.
Non-conforming Products may be returned freight prepaid to CSI after receipt of a return
authorization number from CSI. Return authorization number shall be issued by CSI within two (2)
days from receiving the request from NK. No returns will be accepted without a return
authorization number. As promptly as possible, but not later than ten
(10) working days after CSI’s
receipt of non-conforming Products, CSI shall, at its option and expense, either repair or replace
non-conforming Products. CSI shall provide a repair/replacement report together with any goods
being returned. Title and risk of loss or damage to the products shall pass to the other party
upon delivery to the other party’s carrier. CSI will prepay transportation charges back to NK and
shall reimburse NK for any costs of transportation incurred by NK in connection with the return to
CSI of properly rejected goods. Other than as permitted in this Section or under the terms of the
warranty stated herein, goods may not be returned to CSI.



     7.6 Failure to Pay Duties. NK shall bear all applicable taxes (such as sales, use or
similar taxes); all customs, duties, and similar charges; and all personal property taxes
assessable on Products after delivery to the carrier at CSI’s plant. In the event of NK’s failure to
pay any amounts due CSI within the time herein provided, CSI may, in addition to other remedies
available to it, cease acceptance and/or delivery of orders for Products from NK until such time as
NK’s payments are current and may thereafter condition acceptance and delivery of future orders on
such other or additional payment terms as it shall, in its discretion, determine.



“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”




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     7.7 Inspection. NK may, by itself or through its appointed representative, during
regular business hours and following reasonable notice to CSI,
inspect CSI’s physical facilities
and CSI’s quality control procedures in order to assure compliance with the specifications, quality
requirements and other applicable standards. In the event that NK determines that the quality
procedures applied by CSI are insufficient as to ensure consistent acceptable quality, NK shall
specifically inform CSI thereof and of its recommended corrective measures to be undertaken by
CSI. CSI agrees to evaluate such recommendation in good faith. CSI agrees to take all appropriate
measures in order to ensure compliance of its sub-suppliers with the foregoing. Any circumstance
which might lead to modification or cancellation of CSI’s quality certificate(s) or status as an
FDA registered manufacturer in good standing, shall be immediately informed to NK in writing.



8. PRICES AND TERMS OF PAYMENT




     8.1 Prices. The prices for the Products shall be as set forth in Appendix 2 and
unless expressly otherwise agreed by the Parties CSI shall sell and NK shall purchase the Products
at those prices.



     8.2 Credit. Any credit terms set forth for NK hereunder shall be subject to the
condition that open account credit is established and maintained to
CSI’s satisfaction and that
shipment of any delivery will not cause NK to exceed such credit limit as CSI may from time to
time establish. Unless expressly otherwise agreed in writing, payment for all Products shall be
made by NK in US dollars by wire transfer within thirty (30) days from the date of arrival of the
Products at NK’s premises or such other destination as may have been specified in the purchase
order. In addition to all of the other rights and remedies to which CSI shall be entitled, CSI
shall be entitled to interest on overdue payments at the rate of twelve (12) per cent per annum or
highest rate permitted by the applicable law, whichever is lower. In the event of NK’s failure to
pay any amounts due CSI within the time herein provided, CSI may, in addition to other remedies
available to it, cease acceptance and/or delivery of orders for Products from NK until such time
as NK’s payments are current.



9. CSI REPRESENTATIONS AND WARRANTIES




     9.1 General. CSI’s warranty obligations for the Products supplied by CSI shall be set
forth in subsection (a) — (e) below:



          (a) CSI represents and warrants that the Products supplied by CSI shall be in accordance with
the specifications and quality requirements specified in this Agreement and for a period of five
years (5) after delivery by CSI of each Product to NK, such Product, (i) will function in
accordance with the applicable specifications; and (ii) will be free from defects or faults in
design workmanship and materials;




          (b) Products as provided by CSI, and as of the Effective Date, are in compliance with all
applicable requirements of U.S. and Japanese law or regulation. As stated in Section 13.2 herein,
CSI will make its best effort to be in compliance with applicable regulatory requirements of other
foreign countries in which the Products may be marketed;



“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”





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          (c) CSI shall maintain quality control procedures in compliance with the requirements of the
following quality systems ISO 9001, EN 46001 or ISO 13485, US GMP 21 CFR 820 (“the US GMP”) and
the Council Directive 93/42/EEC concerning medical devices promulgated by the Council of the
European Communities as amended (“the MDD”). If requested by NK, CSI shall provide NK with
appropriate documents evidencing that the Products comply with the essential requirements of the
MDD and US GMP product standards. CSI grants NK the right, by itself or through its appointed
representative, during regular business hours and following reasonable notice to CSI, to inspect
CSI’s physical facilities and CSI’s quality control procedures in order to assure compliance with
the specifications, quality requirements and other applicable standards as required by JMHW
ordinances. In the event that NK determines that the quality procedures applied by CSI are
insufficient as to ensure consistent acceptable quality, NK shall specifically inform CSI thereof
and of the reasonable corrective measures recommended to be undertaken by CSI. CSI agrees to
consider in good faith any such recommended corrective measures without delay. CSI agrees to take
all appropriate measures in order to ensure compliance of its sub-suppliers with the foregoing;




          (d) CSI has good and marketable title, and the right to license or sell the Products free and
clear of all liens, security interests and encumbrances;




          (e) CSI has the legal capacity to execute this Agreement and to perform its obligations
hereunder; and execution and delivery of this Agreement by CSI and performance of its obligations
hereunder shall not violate any applicable U.S. laws.




     9.2 Remedies, (a) If CSI breaches any of its warranties described in Section 9.1, CSI
will, in its sole discretion, either: (i) repair or replace the Product under the applicable
warranty, or (ii) refund any fees already paid for the non-conforming goods. If CSI decides to
repair or replace a Product, NK shall contact CSI and inform CSI of the relevant information and
request a returned goods authorization. If CSI gives a returned goods authorization, CSI will bear
shipping costs in transit in both directions; provided, however, CSI will only bear CSI’s shipping
costs to CSI if NK ships via a carrier designated by NK and directs the carrier bill to CSI. Title
and risk of loss or damage to the Product shall pass to the other party upon delivery to the other
party’s carrier. CSI shall ship the repaired or replacement Product to NK with repair/replacement
report as promptly as possible, but not later than ten (10) working days after CSI’s receipt of
the non-confirming Products.



     9.3 Limitations.



          (a) THE EXPRESS WARRANTY PROVIDED IN THIS ARTICLE 9 IS THE SOLE AND EXCLUSIVE WARRANTY GIVEN
BY CSI WITH RESPECT TO THE PRODUCTS, AND CSI GIVES AND MAKES NO REPRESENTATIONS OR WARRANTIES OF
ANY KIND, EXPRESS OR IMPLIED, OTHER THAN THE FOREGOING. WITHOUT LIMITING THE GENERALITY OF THE
FOREGOING, NO IMPLIED WARRANTY OF MERCHANTABILITY, NO IMPLIED WARRANTY OF FITNESS FOR A PARTICULAR
PURPOSE, AND NO IMPLIED WARRANTY ARISING BY USAGE OF TRADE, COURSE OF DEALING OR COURSE OF
PERFORMANCE IS GIVEN OR MADE BY CSI OR SHALL ARISE BY OR IN CONNECTION WITH ANY SALE OR PROVISION
OF THE PRODUCTS BY CSI OR NK’S USE OR SALE OF THE PRODUCTS OR NK’s AND CSI’s CONDUCT IN



“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”





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RELATION THERETO OR TO EACH OTHER. NO REPRESENTATIVE OF CSI IS AUTHORIZED TO GIVE OR MAKE ANY
OTHER REPRESENTATION OR WARRANTY OR TO MODIFY THE FOREGOING WARRANTY IN ANY WAY. THE REMEDIES SET
FORTH IN SUCH EXPRESS WARRANTY ARE THE ONLY REMEDIES AVAILABLE TO ANY PERSON FOR BREACH OF
WARRANTY.




          (b) The warranties described in Article 9 do not extend to any Products that have been
subject to misuse, neglect or accident; that have been damaged by causes external to the Products,
including but not limited to failure of or faulty electrical power; that have been used in
violation of CSI’s instructions, inconsistent with the Documentation or outside the scope of the
license granted herein; on which the serial number has been removed or made illegible; or that
have been modified, disassembled, serviced or reassembled by anyone other than CSI or its
authorized agents.




          (c) NK agrees that the warranty, remedies and limitations on liability provided in this
Agreement (subject to the limitations thereon) reflect a bargained-for compromise between CSI and
NK as to the allocation of risk in this Agreement.




10. NK REPRESENTATION AND WARRANTY




     10.1 General. NK represents and warrants:



          (a) As to Products subject to sublicenses granted by NK, NK shall not provide any
representations and warranties to its sublicenses, which exceed in scope the representations and
warranties provided by CSI to NK herein.




          (b) NK has the legal capacity to execute this Agreement and perform its obligations
hereunder;




          (c) Execution and delivery of this Agreement by NK and performance of its obligations
hereunder shall not violate any applicable Japan laws.




11. LIMITATION OF LIABILITY EXCEPT PRODUCT LIABILITY




     IN NO EVENT WILL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR ANY INDIRECT, INCIDENTAL,
CONSEQUENTIAL, SPECIAL OR EXEMPLARY DAMAGES OR LOST PROFITS, EVEN IF ADVISED OF THE POSSIBILITY OF
SUCH DAMAGES. THE LIABILITY OF CSI FOR ANY CLAIM CONCERNING PERFORMANCE OR NONPERFORMANCE BY CSI
PURSUANT TO, OR IN ANY WAY RELATED TO, THE SUBJECT MATTER OF THIS AGREEMENT, REGARDLESS OF THE FORM
OF ACTION, WHETHER IN CONTRACT OR IN TORT, EXCEPT PRODUCT LIABILITY DESCRIBED IN SECTION 12, SHALL
BE LIMITED TO THE AMOUNT PAID TO CSI BY NK FOR THE LICENSED CIRCUIT BOARDS OR REPLACEMENT
ELECTRODES, AS APPLICABLE, IN ACCORDANCE WITH THIS AGREEMENT AND WITH RESPECT TO WHICH LICENSED
CIRCUIT BOARDS OR REPLACEMENT ELECTRODES, AS APPLICABLE, SUCH CLAIM SPECIFICALLY RELATES. IN NO
EVENT SHALL CSI BE LIABLE FOR DAMAGES CAUSED BY NK’s OR ANY END-USER’S ACT OR OMISSION.



“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”




-11-









 





12. PRODUCT LIABILITY




     CSI agrees to indemnify and hold NK harmless from and against any and all losses, claims,
damages, costs and expenses, including reasonable attorney’s fees, arising out of or relating to
personal injury, illness and/or death if it is established that such damage and/or personal injury
resulted from i) defect with respect to design, manufacturer, workmanship or materials of the
Product; or ii) failure of the Product, at the time of shipment to NK, to comply with the
Technical Specifications which is specified in Appendix 3.



13. REGULATORY REQUIREMENTS, RECALLS




     13.1 The Parties confirm that in relation to the JMHW regulatory approvals or submission that
NK shall be regarded as the manufacturer of the Products. The Parties agree to cooperate in order
to gain JMHW regulatory approval for the Products.



     13.2 Each Party shall make its best efforts to comply with all applicable laws and
regulations of the competent jurisdiction in which NK sells its Products. In particular, each
Party shall ensure that the Products as well as their respective activities in relation thereto
conform to all legislation, rules, regulations and statutory requirements existing from time to
time.



     13.3 If either Party becomes aware of an event where there is reasonable suspicion that the
Product contributed to or caused a death or serious injury or an event where a Product has
malfunctioned and, if that malfunction occurred again, it could cause death or serious injury. As
used herein, “Serious injury” means: Any injury or illness that i) is life threatening, or ii)
result in permanent impairment of a body function or permanent damage to a body structure, or iii)
necessities medical or surgical intervention to preclude permanent impairment of a body function
or permanent damage to a body structure. To be reported a direct link with the Product and its
possible short -comings should be clearly established. Party shall use its best efforts to give
such notice to the other Party orally within 24 hours from the receipt of such complaint or
becoming aware of such event and shall use its best efforts to confirm such notice by telefax
within 24 hours after giving oral notice.



     13.4 The Parties shall be responsible for reporting under United States reporting requirements
such as 21 CFR Part 803, the Japanese Ministry of Health and Welfare and the European Union
reporting requirements and under the reporting requirements of any other country as may be
applicable. Before submitting a report involving a Product either Party shall use its best efforts
to notify the other Party and to obtain any information it may have relating to any incident
involving a Product. Copies of such reports shall be sent to the other Party without delay. If JMHW
or any governmental authorities require to take any product corrective action (including
notification, recall, removal and correction) involving a Product in Japan and NK decides to
voluntarily take any product corrective action and in Japan and overseas, NK shall use its best
efforts to notify CSI immediately. In case that CSI decides to take any corrective action for any
product in overseas which is substantially the same as the Products specified herein and the cause
of such corrective action affects the Products sold or distributed by NK, CS shall use its best
efforts to notify NK immediately with such cause and NK shall have a right to take corrective
action of the Products. If FDA or other authorities contact either Party to inquire about or
investigate the Products sold under this Agreement, the contacted Party, unless required to



“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”




-12-









 




maintain confidentiality by such authorities, shall inform the other Party immediately thereof.
The Parties shall co-operate closely to clear any regulatory issues or potential regulatory issues
promptly.




     13.5 In the event NK decides to take any product corrective action (including notification,
recall, removal and correction) with respect to the Product sold or distributed by NK, regardless
of whether such action is initiated to comply with applicable laws or regulations or for other
reasons, the Parties agrees that: a) NK shall be the point of contact for purchasers of its
Products (whether directly of through its distributors); b) after discussion between the parties,
NK will “define the action to be taken” and c)during the course of recall of the Product, CSI shall
work with NK to provide replacement Product if required by end users customers to minimize any
downtime of replacement Product. In such cases, CSI shall provide NK with efficient quantity of
replacement Product as soon as possible for NK’s immediate action to end users customers and d) CSI
shall reimburse NK for direct costs of the type set forth below which are in incurred by NK to
implement such actions,



     As used herein, “define action to be taken” means;




	 	i)	 	In the event of any recall of any Product, CSI shall work with NK to provide
investigation of scope and root cause of the Product failure, and provide a corrective
action plan for any found cause of the Product failure.
	 
	 	ii)	 	Defining the
effectiveness check procedure (to establish the corrective action has
been completed).
	 
	 	iii)	 	CSI shall make every effort to pursue any necessary actions
against the Vendor or
Supplier responsible for the Product.
	 
	 	iv)	 	If NK submits a corrective action request
that accompanies an end users customer
returned Product that requires immediate response, then Seller shall respond with
scope of problem evidence of registration and initial plan for root cause analysis
within 72 hours of the request.






The type of costs reimbursable under d) above are: mailing, telephone, telefax and printing
charges for shipment of the Product to NK back to CSI; and direct labor costs to receive
and handle returned Product and to replace the Product to end users customer. In case that
it is necessary for NK to confirm that Product is manufactured under appropriate
manufacturing and quality control, NK has a right to audit such system.



14. INTELLECTUAL PROPERTY RIGHTS




     14.1 Ownership. Except as expressly provided herein, neither Party grants to the
other Party any license or intellectual property right, other by implication, estoppel or
otherwise in and to its Products, patents, trademarks, documentation and confidential information.
Except in the case of NK’s need to provide authorized service to said Products, NK shall not: (a)
reverse engineer, decompile, disassemble or otherwise tamper with the Products; and (b) permit any
third party including any of NK’s distributors or end users customers to do any of the foregoing.



     14.2 CSI Trademarks. Subject to NK’s compliance with the terms of this Agreement, CSI
grants to NK the non-transferable and non-assignable right to use the trademarks, service



“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”




-13-









 







marks, trade names, logos or other words or symbols of CSI identifying the Products (the
Trademarks”) on NK’s advertising and promotional materials, stationery, signs, labels and
packaging in order to convey that NK is manufacturing Products, equipment or devices which
incorporate the Products. The Trademarks are and shall remain the exclusive property of CSI,
whether or not such ownership is specifically recognized or protected under the laws of the
Territory. NK shall acquire no rights to the Trademarks other than those set forth in this
Article, and NK hereby assigns and transfers to CSI all rights other than those granted pursuant
to this Section that it may acquire in and to the Trademarks, whether by operation of law or
otherwise. NK shall comply with CSI’s guidelines for the use of the Trademarks, and shall allow
CSI an opportunity to inspect the Products to confirm NK’s compliance herewith.



     14.3 NK Trademarks. CSI shall not use or refer to NK’s name or trademarks in any
other form or manner or for any other purpose than what is expressly allowed in this Agreement.
All artwork, packages and labels (if any) prepared by CSI in connection with the NK name shall be
sent to NK for approval.



     14.4 Infringement. CSI warrants that it is the sole and exclusive owner of, or has
valid licenses, with the right to sublicense, the Products, in each case free and clear of any and
all liens, claims or encumbrances. CSI represents that (i) it has not been determined to be
infringing any patents or other rights with respect to the Products and (ii) no person has
asserted that CSI’s manufacture or sale of the Products anywhere in the world infringes any patent
or other proprietary right of such person.



     14.5 Notification. NK shall promptly notify CSI of (a) any claims, allegations or
notification that NK’s sale, offer to sell, license, lease, importation, export, transfer or
distribution of any Product may or will infringe the Intellectual Property Rights of a third party;
and (b) any determination, discovery, or notification that any person or entity is infringing or
may be infringing the Intellectual Property Rights of CSI.



     14.6 Alteration and Use. NK may not remove or alter any proprietary designs notices or
Marks contained in or on the Products, Documentation or related materials. NK may not make any
reference or claim about CSI or the Products or use any of CSI marks, which have not been approved
or provided by CSI.



15. CONFIDENTIALITY




     15.1 This Agreement and all documents, drawings, manuals and other materials related thereto
and transmitted between the Parties, provided that only if it is designated as “Confidential” in
writing when communicated, or within thirty (30) days of disclose, if disclosed orally, shall be
treated as confidential by the Parties and their employees and such information shall not be
disclosed to any third party. Without the other Party’s prior written consent, this Agreement and
any other materials treated as confidential hereunder may be disclosed by either parties in
compliance with governmental regulations and other corporate reporting requirements; provided that
such Party has notified the other Party and cooperated in good faith to take such steps as may be
reasonably available to protect the confidentiality of the information contained therein to the
extent requested by the other Party and as may be allowable by the applicable law. Confidential
Information does not include information that: a)at the time of disclosure is already



“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”




-14-









 







known to the public, b) becomes generally available to the public after disclosure through no fault
on the party, c) Recipient can demonstrate it had rightfully, prior to disclosure to Recipient by
the other party, d) Recipient rightfully obtains from a third party having the right to disclose
it, or e) is independently developed by recipient without the use of Confidential Information;
Each Party shall arrange proper filing for specifications and drawings given by the other Party.
Each Party shall nominate a person who shall be in charge of the filing and shall inform this
person of the confidentiality requirements of this Agreement. The parties agree to hold all
Confidential Information confidential for a period of two (2) years after the expiration and/or
termination of the Agreement.



16. CSI INDEMNIFICATION




     16.1 Indemnity. Subject to NK satisfying the conditions of Section 14, CSI shall
indemnify and hold NK, its affiliates and their respective directors, officers, employees and
representatives harmless from and against any suits, actions, losses, damages and other expenses
solely arising out of or in connection with any claim (a) that any authorized use of a Product
infringes or violates any Intellectual Property Right or copyright of a third party.



     16.2 Remedies. If NK’s or any End-User’s use of the Products is prevented by an
injunction or court order because of any claim of infringement, CSI will, at its expense, and in
its sole discretion, use reasonable commercial efforts to: (a) replace or modify the Product, in
such a manner so as to maintain its functionality and compatibility, but nonetheless make the
Products, as applicable, no longer subject to a claim of infringement; or (b) procure for NK’s or
any End-User’s benefit the right to use and resell the Products, as applicable, as provided in
this Agreement. If (a) and (b) above are not commercially viable, CSI shall refund to NK all
amounts paid therefore by NK and shall terminate the rights granted herein.



     16.3 Exclusion. CSI will have no liability for any claim of indemnity if such claim
is based upon: (a) Products that have been modified, disassembled, reassembled, serviced, altered
or changed without the express written authorization of CSI; or (b) the combination, operation, or
use of the Products with software and/or hardware not supplied by CSI, if such liability would
have been avoided in the absence of such combination, operation or use.



     16.4 Entire Liability. This Article 16 states CSI’s entire liability for infringement
of any patent or other intellectual rights with respect to the Products



     16.5 Conditions. NK shall promptly notify CSI of (i) any matter for which NK may
claim indemnification, (ii) any claim against NK that any Products misappropriate any trade secret
or infringe any patent, copyright or other Intellectual Property Right of a third party and (iii)
any suit, action or proceeding brought against NK on the basis of any such claims. CSI shall, in
its sole discretion, defend or settle any such claim, suit, action or proceeding in any manner and
on any terms it shall deem appropriate, and the costs thereof (including any final award of
damages) shall be borne entirely by CSI. If CSI elects to defend any such suit, action or
proceeding, NK shall provide CSI, at CSI’s expense, with all the needed information, assistance
and authority necessary to enable CSI to defend such claim. NK shall not without CSI’s prior
written approval itself defend or settle any such suit, action or proceeding.



“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”



-15-









 





17. NK INDEMNITY




     17.1 General. NK shall indemnify and hold harmless CSI, its affiliates and their
respective directors, officers, employees and representatives harmless from any claims, demands,
actions, suits, proceedings, judgments, damages, expenses and costs (including reasonable
attorneys fees) related to:



          (a) Any of its activities under this Agreement, including any third party assertion that the
Products or any component thereof, to the extent they have been modified, disassembled,
reassembled, serviced, altered or changed by NK, infringe or misappropriate any patents or
copyrights of such third parties;




          (b) Death, injury or damage (including death) to any person or property caused by the
Products that have been subject to modification, alteration or change that NK instructed and/or
required to CSI.




     17.2 Conditions. CSI shall promptly notify NK of (i) any claim against CSI that
Products, which have been modified, disassembled, reassembled, serviced, altered or changed by NK
or CSI in accordance to NK’s instruction or requirement, misappropriate any trade secret or
infringe any patent, copyright or other intellectual property right of a third party and (ii) any
suit, action or proceeding brought against CSI on the basis of any such claims. NK shall, in its
sole discretion, defend or settle any such claim, suit, action or proceeding in any manner and on
any terms it shall deem appropriate, and the costs thereof (including any final award of damages)
shall be borne entirely by NK. If NK elects to defend any such suit, action or proceeding, CSI
shall provide NK, at NK’s expense, with all the needed information, assistance and authority
necessary to enable NK to defend such claim. CSI shall not without NK’s prior written approval
itself defend or settle any such suit, action or proceeding.



18. INSURANCE




     Throughout the term of this Agreement, and for a period of at least three (3) years
thereafter, CSI and NK shall each carry a reasonable amount of commercial general liability
insurance. Insurance is to be maintained by parties pursuant to the provisions of this Article
shall provide for written notice to the other party thirty (30) days in advance of any termination
or cancellation of such insurance. Upon the request of either party from time to time during the
term hereof, each party shall provide the other with a certificate evidencing such insurance
coverage.



19. GENERAL




     19.1 Notices. All notices, requests, demands, waivers and other communications
required or permitted to be given under this Agreement are to be in writing and are deemed to be
duly given (a) upon being delivered either personally or by overnight courier with delivery charges
prepaid, (b) upon the fifth (5th) day from the date such notice was mailed by certified
or registered mail, postage prepaid, receipt requested, or (c) upon being sent by email or
telecopy, to the people and addresses set forth below or to such other person or address as either
party may



“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”



-16-









 







specify by notice in writing to the other party. All notices, requests, demands, waivers and
communications are received on the date of delivery.


If to CSI:



Cardiac Science, Inc.

1900 Main Street, Suite 700

Irvine, California 92614

Attention: Raymond W. Cohen, Chief Executive Officer

Email: rwcohen@cardiacscience.com

Facsimile: (949) 951-7315



If to NK:



Nihon Kohden Corporation

31-4 Nishiochiai 1 Chome

Shinjuku-ku, Tokyo 161-8560 JAPAN

Attention: Kohei Ono, Corporate Director, General Manager,

                    Engineering Operations

Email: Kohei_Ono@mb2.nkc.co.jp

Facsimile: +81 3 5996 8097




     19.2 Force Majeure. If the performance of any obligation under this Agreement is
prevented, restricted or interfered with by reason of war, civil commotion, embargo, strike or any
other act which is beyond the reasonable control of the party affected, then the party so affected
shall, upon giving written notice to the other party, be excused from such performance to the
extent that such prevention, restriction or interference; provided that the party so affected shall
use commercially reasonably efforts to avoid and remove such causes of non-performance, and shall
continue performance hereunder with reasonable dispatch whenever such causes are removed.



     19.3 Successors and Assigns. This Agreement inures to the benefit of and is binding
upon the parties hereto and their successors and permitted assigns. Nothing in this Agreement,
expressed or implied, confers on any person other than the parties hereto (or their successors and
permitted assigns), any rights, remedies, obligations or liabilities.



     19.4 Entire Agreement. This Agreement (including the Exhibits) is the entire
agreement between the parties hereto with respect to the subject matter hereof and supersedes all
other prior and contemporaneous agreements and understandings, oral and written.



     19.5 Assignment. Neither party may assign this Agreement without the prior written
approval of the other party.



     19.6 Relations. This Agreement creates no partnership, joint venture, franchise or
agency between the parties. Except as expressly set forth in this Agreement, neither party has the
right to assume or create, either directly or indirectly, any liability or any obligation of any



“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”



-17-









 







kind, expressed or implied, in the name of or on behalf of the other party, and neither party
shall represent that it has such authority.



     19.7 Waiver. This Agreement may only be waived or amended, if such waiver or
amendment is in writing, specifically references this Agreement and is executed by the party to be
bound. The waiver by either party of a breach of any provision of this Agreement does not operate
as a waiver of any other breach. A party’s failure or delay to exercise any right hereunder does
not operate as a waiver.



     19.8 Unenforceability. The illegality, invalidity or unenforceability of any part of
this Agreement does not affect the legality, validity or enforceability of the remainder of this
Agreement. If any part of this Agreement is found to be illegal, invalid or unenforceable, this
Agreement will be given such meaning as would make this Agreement legal, valid, and enforceable in
order to give effect to the intent of the parties.



     19.9 Governing Law. This Agreement is governed and construed according to the laws of
California, U.S.A. The court of competent jurisdiction shall be the district court of California,
U.S.A., if an action is brought by NK, or in Tokyo district court, Japan if an action is brought by
CSI.



     19.10 Dispute Resolution. Prior to taking any legal action, the parties shall attempt
to resolve any claim or controversy arising out of this Agreement by way of amicable negotiations
within a reasonable period not to exceed thirty (30) days after the date of a notice from either
party to the other describing such claim or controversy.



     19.11 Irreparable Harm. CSI and NK acknowledges that, in view of the uniqueness of
the transactions contemplated by this Agreement, a material breach or material failure to comply
with its confidentiality obligations or license restrictions would cause irreparable harm to other
party’s business and that the other party would not have an adequate remedy at law for money
damages. Therefore, CSI and NK agrees that NK and CSI is entitled to specific performance and/or
injunctive relief without the posting of bond or other security in addition to any other remedy to
which it may be entitled hereunder or at law or in equity, in any court of competent jurisdiction
against any such breach or noncompliance. All remedies provided for herein are cumulative and the
exercise of any particular remedy by NK and CSI and does not limit or preclude the exercise of any
other remedy available to it.



     19.12 Survival. Articles and Sections 1, 2.2, 3.2, 3.3, 4.3, 5.6, 5.8, 5.10
9, 10.1, 11, 12, 13, 14, 15, 16, 17 survive any expiration or termination of this Agreement.



     19.13 Counterparts. This Agreement may be executed in counterparts, each of which
shall be deemed an original and all of which together shall be deemed to be one and the same
instrument.



“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”




-18-









 





* * *


IN WITNESS WHEREOF, the Parties have caused this OEM Supply and Purchase Agreement to be
executed by their duly authorized representatives.




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 	 	 	 	 	 	 	 
	Nihon Kohden Corporation	 	 	 	Cardiac Science Inc.	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:	 	/s/ Kohei Ono	 	 	 	By:	 	/s/ Raymond W. Cohen	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	Kohei Ono
	 	 	 	 	 	Name:
	 	Raymond W. Cohen	 	 
	 

	 	Title:
	 	Corporate Director
	 	 	 	 	 	Title:
	 	Chairman & CEO	 	 
	 

	 	 	 	General Manager	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	Engineering Operations	 	 	 	 	 	 	 	 	 	 






APPENDICES:





	1.	 	The Products
	 
	2.	 	Parts (Appendix A)
	 
	3.	 	Prices
	 
	4.	 	Technical Specifications
	 
	5.	 	Definitions
	 
	6.	 	Notification of Quality Control and Assurance from CSI






“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”



-19-











 





APPENDIX 1




The Products



The Products consist of the following:



One each High Voltage Board and one each User Interface Circuit Board containing the CSI
proprietary technology together as a set which contain, among other things, CSI proprietary
technology including, but not limited to RescueReady®, STAR® biphasic and
RHYTHMx® analysis software. STAR shall include necessary software to produce a either a
monophasic defibrillation waveform or a biphasic waveform. Technical specifications of the Circuit
Boards are attached hereto as Appendix 3.



“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”





-20-









 









Appendix A




     Listing of Parts


Other Parts to be purchased by NK directly from CSI
vendors. Items are listed for reference only and may be
subject to change based on NK specifications:




	 	 	 	 	 	 	 	 	 
	Label, ID
	 	 	1	 	 	$	[*]	 
	Screw
	 	 	1	 	 	$	[*]	 
	HV capacitor
	 	“per set of 	2	” 	 	$	[*]	 
	Internal cable
	 	 	1	 	 	$	[*]	 
	Case bottom
	 	 	1	 	 	$	[*]	 
	RS-232 cover
	 	 	1	 	 	$	[*]	 
	Patch connector keeper
	 	 	1	 	 	$	[*]	 
	Shock button
	 	 	1	 	 	$	[*]	 
	Control panel label
	 	 	1	 	 	$	[*]	 
	NVI label
	 	 	1	 	 	$	[*]	 
	Insulator
	 	 	1	 	 	$	[*]	 
	Foam, capacitor
	 	 	2	 	 	$	[*]	 
	Foam, stop, patient connector
	 	 	1	 	 	$	[*]	 
	Nylon bushing
	 	 	1	 	 	$	[*]	 
	Screw
	 	 	7	 	 	$	[*]	 
	Standoff
	 	 	2	 	 	$	[*]	 
	Insert, shipping box
	 	 	1	 	 	$	[*]	 
	Assy, lid
	 	 	1	 	 	$	[*]	 
	Assy, sonalert
	 	 	1	 	 	$	[*]	 
	Assy, NVI
	 	 	1	 	 	$	[*]	 
	Assy, conn, electrode harness
	 	 	1	 	 	$	[*]	 
	Assy, batt contact
	 	 	1	 	 	$	[*]	 
	Assy, case top
	 	 	1	 	 	$	[*]	 
	Assy, adapter
	 	 	2	 	 	$	[*]	 
	Disk, Insulator, battery
	 	 	1	 	 	$	[*]	 
	Display, LCD
	 	 	1	 	 	$	[*]	 
	Label, HV
	 	 	1	 	 	$	[*]	 
	SERIAL CABLE
	 	 	1	 	 	$	[*]	 




“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”





-21-









 







APPENDIX 2: PRICES



The prices for the Circuit Boards and Products during the Term are as follows




	 	 	 	 	 
	Product	 	Transfer price
	High Voltage Board and

User Interface Circuit Boards containing the 

CSI proprietary technology together as a set

	 	$	[*]	 
	 
	 	 	 	 
	High Voltage Board part number 120-2060-002

User Interface Circuit Board part number 120-2080-001
	 	 	 	 
	 
	 	 	 	 
	QUANTITY OF 1-999 PCS
	 	 	 	 
	 
	 	 	 	 
	High Voltage Boards and

User Interface Circuit Boards containing the 

CSI proprietary technology together as a set

	 	$	[*]	 
	 
	 	 	 	 
	High Voltage Board part number 120-2060-002

User Interface Circuit Board part number 120-2080-001
	 	 	 	 
	 
	 	 	 	 
	QUANTITY OF 1,000 PCS OR HIGHER
	 	 	 	 
	 
	 	 	 	 
	High Voltage Boards as spare parts — part number 120-2060-002

	 	$	[*]	 
	 
	 	 	 	 
	User Interface Circuit Boards as spare parts — part number 120-2080-001

	 	$	 [*]	 
	 
	 	 	 	 
	AED Electrodes

	 	$	[*]	 
	 
	 	 	 	 
	CD for Rescue-Link software as spare parts

	 	$	[*]	 






Notes:





	 	1.	 	All prices are in US Dollars (USD).
	 
	 	2.	 	Once NK’s aggregate purchase quantity reaches [*] or higher during the term of
this Agreement, the discounted price of [*] will be immediately applied to any order.
	 
	 	3.	 	Circuit boards may be ordered with software to produce a monophasic defibrillation
waveform or a biphasic waveform.
	 
	 	4.	 	Product to include 1 each CD containing Rescue-Link software.





“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”




-22-









 











APPENDIX 3




Technical Specifications (TO BE COMPLETED)




[*]



-23-









 





[*]



-24-









 








APPENDIX 4



Definitions



The following is a listing for convenient reference of terms as defined in this Agreement:





	 	1.	 	Affiliate means with respect to any specified party, any other legal entity that
directly or indirectly controls, is controlled by or is under common control with, such
specified party.
	 
	 	2.	 	CSI means Cardiac Science, Inc.
	 
	 	3.	 	NK and NKC means the Nihon Kohden Corporation.
	 
	 	4.	 	Effective Date means the date on which the Parties has signed this Agreement.
	 
	 	5.	 	Initial Term means the period from the Effective Date until December 31, 2008 unless
earlier terminated pursuant to other terms hereof.
	 
	 	6.	 	AED 1x means an AED device that is appropriate for sale to consumers containing
certain components made by CSI for incorporation by NK into an AED device to be
manufactured by NK for sale under one or more of NK’s trademarks or brand names.
	 
	 	7.	 	Products and Circuit Boards and AED Technology Components means products as specified
in Appendix 1 that include certain CSI technology components such as High Voltage Circuit
boards and User Interface Circuit Boards manufactured by CSI which contain CSI proprietary
technology including, but not limited to CSI’s RescueReady®, STAR® biphasic and
RHYTHMx® analysis software.
	 
	 	8.	 	Parts means other miscellaneous parts as defined in Appendix A
	 
	 	9.	 	MDD means the counsel directive 93/42 EEC concerning medical devices promulgated by the
Council of the European Communities as amended.
	 
	 	10.	 	Party or Parties means NK and CSI individually and collectively as applicable
	 
	 	11.	 	Renewal Term means successive one-year terms during which this Agreement may be
automatically renewed following the Initial Term or any prior Renewal Term.
	 
	 	12.	 	U.S. GMP means the requirements of U.S. GMP 21 CFR 820.




“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”




 









 











Appendix 5



Notification of Quality Control and Assurance from CSI





	 	1.	 	CSI shall, in a timely manner, inform the following of NKC in writing by fax or email:
	 
	 	2.	 	CSI shall notify NKC if specifications effecting the Products performance, quality and
function change, including block diagrams or if there are significant changes in the
testing procedures.
	 
	 	3.	 	CSI SHALL NOTIFY NK IF CSI HAS REASON TO BELIEVE THAT THE PRODUCTS (AS DEFINED IN THIS
AGREEMENT) ARE SUSPECTED TO HAVE ANY DEFECTS IN QUALITY OR WORKMANSHIP.
	 
	 	4.	 	If after the products are supplied to NKC, if there are any mistakes or omissions which
shall be corrected, or if there are any other additional items concerning safety which are
not described on the operator’s manual, CSI shall inform NKC of them in writing.
	 
	 	5.	 	If the High Voltage or User Interface circuit boards or material or structure of the
Products is improved or changed, CSI shall inform NKC of such changes regardless of the
details of notification to JMHW. If parts, related to electrical isolation of applied
part from live parts, and creepage distance, air clearance and construction related to
dielectric stress are changed, or these parts manufacturers are changed. If dimension and
weight are changed more than +/- 5% greater
	 
	 	6.	 	If any software on the Products is changed or modified is such a way that the automatic
charge and/or internal discharge algorithm or arrhythmia detection algorithm is changed, or
change that affects input and output or the result of arrhythmia detection program is
implemented, CSI shall inform NKC of the differences between changed products and previous
products, the purpose or reason of the change, and identify the scope of the change
(whether it is applied to products which has already supplied to the customer, or it limits
products which will be shipped in the future) and explain the reasons to NKC.
	 
	 	7.	 	CSI shall inform NKC if any adverse events concerning AED that are reported in a
medical congress, or in FDA Enforcement Report. CARDIAC SCIENCE SHALL NOT HOWEVER
AUTOMATICALLY NOTIFY NK OF ROUTINE SUBMISSIONS OF MDRS TO THE FDA, NOR SHALL CARDIAC
SCIENCE ROUTINELY NOTIFY NK OF PRODUCT COMPLAINTS.






“[*] Designates portions of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission.”




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