EX-10.20 Addendum to Asset Contribution Agreement



 





EXHIBIT 10.20




ADDENDUM TO ASSET CONTRIBUTION AGREEMENT




THIS ADDENDUM TO ASSET CONTRIBUTION AGREEMENT (this “Agreement”) is made and entered into effective
the 28th day of December, 2006 (the “Effective Date”), by and among Z-KAT, INC., a Florida
corporation (“Z-KAT”), and MAKO Surgical Corp., a Delaware corporation (“MAKO,” with each of Z-KAT
and MAKO being referred to as a “Party” and, together, as the “Parties.”)



RECITALS




The following recitals for the basis hereof, are hereby acknowledged to be true by the Parties, and
are hereby incorporated herein by this reference:




	A.	 	The parties entered into that certain Asset Contribution Agreement on December 17, 2004 (the
“ACA”) attached hereto as Exhibit R.A. Pursuant to the ACA, certain intangible
property rights were transferred from Z-KAT to MAKO.
	 
	B.	 	Pursuant to the ACA, Z-KAT granted a license and certain sublicenses to MAKO pursuant to the
License Agreement attached hereto as Exhibit R.B. (the “Z-KAT/MAKO 2004 License”).
	 
	C.	 	On March 24, 2006, the parties entered into another license agreement wherein MAKO granted
Z-KAT a License as described therein (the “MAKO/Z-KAT 2006 License”) attached hereto as
Exhibit R.C.
	 
	D.	 	Pursuant to rights granted by Z-KAT to MAKO pursuant to the Z-KAT/MAKO 2004 License, MAKO has
exercised its rights to prosecute, control and maintain all Z-KAT Licensed Patents and
Licensed IP Rights (as such terms are defined in the Z-KAT/MAKO 2004 License).
	 
	E.	 	The parties now seek to clarify and amend as specifically indicated herein the ACA and
certain of these license agreements on the terms and conditions described herein.





     NOW THEREFORE, for and in consideration of the premises, the mutual representations,
warranties and covenants herein contained and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties agree as follows:



AGREEMENT




01. CERTAIN DEFINITIONS




As used herein, the following terms shall have the following meanings:



     01.1 “Affiliate” of a Party shall mean an entity directly or indirectly Controlling,
Controlled by or under common Control with that Party.



     01.2 “Change of Control” shall mean, with respect to a Party, a transaction or the last of a
series of transactions that results in: (a) a person or entity obtaining Control of, directly or


 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.



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indirectly, the Party; (b) a merger, consolidation, amalgamation, or other combination of the
Party with a third party in which the Party is not the surviving corporation or which results in a
new person or entity directly or indirectly obtaining Control of the Party; (c) or an acquisition
of the Party as a subsidiary of a third party; or (d) transfer, assignment or sale of substantially
all of the assets of the Party to which this Agreement pertains.



     01.3 “Control” shall mean the ownership or control, directly or indirectly, of more than fifty
percent (50%) of all of the voting power of the shares (or other securities or rights) entitled to
vote for the election of directors or other governing authority, of an entity.



     01.4 “Qualified IPO” shall mean an underwritten public offering of shares of MAKO in
connection with which the aggregate net proceeds to MAKO equals or exceeds $25,000,000.



1. LICENSE RIGHTS AND OBLIGATIONS




     1.1 MAKO LICENSE RIGHTS



          (a) [***] License. Z-KAT and [***] entered into that certain license agreement dated
August 31, 2001, which [***] subsequently assigned to [***], a copy of which is attached hereto as
Exhibit 1.1(a) (the “[***] License”). Notwithstanding statements to the contrary in Section 4.4 of
the Z-KAT/MAKO 2004 License, the Minimum Royalty due under the [***] (and defined in Section 1.18
therein) will be treated as a Minimum Royalty under the ZKAT/MAKO 2004 License (and defined in
Section 4.4 therein), such that MAKO shall be granted the right and shall assume the obligation to
make payment of such Minimum Royalty pursuant to the terms and provisions of Section 4.4 of the
ZKAT/MAKO 2004 License, including, without limitation, the obligation to make any Minimum Royalty
payment under the [***] unpaid as of the Effective Date.



          (b) [***] Licenses. Z-KAT and [***] entered into a sublicense Agreement on October
12, 2004 where Z-KAT granted a license to [***]with respect to the [***], a copy of which is
attached hereto as Exhibit 1.1(b)(A) (the “[***] Sublicense”). Z-KAT, [***],[***] and
[***] entered into a license agreement on February 9, 2001, a copy of which is attached hereto as
Exhibit 1.1(b)(B) [***]. Z-KAT hereby assigns to MAKO all of its rights to receive any
royalty payments of any kind accrued (but not paid) as of the Effective Date and accruing
thereafter under the [***] Sublicense and the [***] License (together, the “Z-KAT In-Licenses”)
until either the First True Up or Final True Up (each as defined and described below), as
applicable.



          (c) [***]. For as long as MAKO is, pursuant to the Z-KAT/MAKO 2004 License, paying all
Prosecution Costs and Maintenance Costs (as defined and described in the Z-KAT/MAKO 2004 License)
with respect to any particular item of Licensed IP (as defined in the Z-KAT/MAKO 2004 License)
Z-KAT hereby assigns to MAKO its rights to receive payments directly from [***] under the [***]
Sublicense (attached hereto as Exhibit 1.1(c)) with respect to that particular item of
Licensed IP. Z-KAT shall make reasonable efforts in cooperating with MAKO to arrange for MAKO to
bill [***] directly for such payments.



          (d) MAKO Right to Assign License from Z-KAT. Notwithstanding any other term or
provision to this Agreement, the ACA or the Z-KAT/MAKO 2004 License,



 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.



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MAKO shall have the right to assume any License, if it can be assigned as of right, without
loss of Rights, and to take assignment of any Licensed Patent (as such terms are defined in the
Z-KAT/MAKO 2004 License) owned or held by Z-KAT in the event that Z-KAT’s actions or inactions
could reasonably result in forfeiture of such License or Licensed Patent, provided that the
possibility of forfeiture is not caused or does not arise from, in whole or in part, MAKO’s failure
to perform its obligations or observe conditions placed on it pursuant to this Agreement or any
other agreement with Z-KAT; and further provided that MAKO grants concurrently with the assignment
an exclusive, transferable, irrevocable, non-terminable license to Z-KAT, with the right to grant
sub-licenses, in the Z-Kat Field (as defined in the Z-KAT/MAKO 2004 License) as to any assigned
License or Licensed Patent. For the avoidance of doubt, an Assertion (as defined below) does not,
by itself, constitute an action that could reasonably result in forfeiture of a License or Licensed
Patent.



          (e) Termination of MAKO License. Including any other remedies provided for by law,
this Agreement or otherwise, MAKO shall be entitled to terminate the MAKO/Z-KAT 2006 License upon
the occurrence of a breach of this Agreement that is explicitly identified below as a “Material
Breach” and not cured within thirty (30) days of its occurrence. No breach of this Agreement, even
if it is with respect to a material obligation or condition of this Agreement, will give rise to a
right to terminate the MAKO/Z-KAT 2006 License unless it is explicitly identified in this Agreement
as a “Material Breach.”



          (f) No Change to Prior License Rights. Except to the extent expressly stated herein,
nothing in this Agreement is intended to amend or alter any of the existing agreements between
Z-KAT and MAKO. For the avoidance of doubt, except to the extent expressly stated herein, MAKO
shall continue to have the same rights with respect to the Z-KAT/MAKO 2004 License as it enjoyed
prior to the Effective Date with respect to the Z-KAT Licensed Patents and the Licensed IP Rights.



     1.2 Z-KAT License Rights.



          (a) Assertion. Z-KAT will, within a reasonable time prior to proceeding with a threat
to enforce or with action to enforce (an “Assertion”) any of the Licensed IP Rights in the Z-KAT
Field (as those terms are defined in the Z-KAT/MAKO 2004 License), either:



               (i) present MAKO in writing a binding engagement arrangement with competent counsel, covering
the contemplated Assertion and reasonably adequate to ensure proper prosecution and defense of
litigation arising from such Assertion. For the avoidance of doubt, an engagement arrangement on
terms substantially similar to those set forth on Exhibit I.2(a)(i) attached hereto shall
constitute an adequate arrangement; or



               (ii) deposit $[***], either in cash or MAKO Common Stock owned by Z-KAT (in the event
MAKO
stock is used, an independent appraisal must accompany such stock certifying the value as of the
date of deposit) with an independent escrow agent, pursuant to an escrow agreement requiring
transfer from the deposit to MAKO to pay for MAKO’s reasonable attorneys fees and expenses actually
incurred by MAKO, should MAKO elect to take



 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.



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over such Assertion from Z-KAT in the event Z-KAT is unable or unwilling to conduct proper
prosecution and defense of litigation arising from such Assertion.



               (iii) Material Breach. An Assertion made by Z-KAT that is not in compliance with
this
Section 1.2(a) shall constitute a Material Breach by Z-KAT.



          (b) Rights with Respect to MAKO.



               (i) Accounting. Z-KAT may request and MAKO shall provide upon such reasonable
request, an accounting for payments made by MAKO pursuant to rights to make such payments granted
by Z-KAT to MAKO hereunder.



               (ii) Termination or Reimbursement. If MAKO does not make any payment as provided
for
hereunder with respect to a license or sublicense, Z-KAT may make such payment, seeking
reimbursement from MAKO and terminating MAKO’s right to make such payments directly, in addition to
any other rights it may have.



     1.3 True Up Payments.



          (a) Beginning upon the first anniversary of the date of payment of the final minimum royalty
payments due to MAKO under the [***] Sublicense and for each year thereafter in which MAKO is
making royalty payments of any kind under the [***] License, Z-KAT shall be paid (within thirty
days) by MAKO [***] of the positive difference, if any, between (i) the running royalty payments
received by MAKO from the Z-KAT In-Licenses for the preceding year and (ii) any minimum royalty
payments made by MAKO (less any running royalties due under the [***] License from activities of
MAKO and its sublicensees) under the [***] License (each an “Excess Royalty Payment”).



          (b) At the end of the Initial Royalty Period as defined in the [***] License, MAKO shall
calculate the difference between (i) all amounts received by MAKO under the Z-KAT In-Licenses and
(ii) the sum of all payments made by MAKO under the [***] License (less any running royalties due
under the [***] License from activities of MAKO and its sublicensees) and the sum of all Excess
Royalty Payments made by MAKO to Z-KAT (the “First True Up”). If the First True Up is a positive
number Z-KAT shall be entitled to payment of the amount of the First True Up (within thirty days)
and the assignment of royalties from the Z-KAT In-Licenses pursuant to Section 1.1(b) shall
terminate. If the First True Up is a negative number, MAKO shall be entitled to all royalties of
any kind under the Z-KAT In-Licenses, which royalties shall be applied against the First True Up
number as received by MAKO until such time as the First True Up number has been reduced to zero
(the “Final True Up”), at which point the assignment of royalties from the Z-KAT In-Licenses
pursuant to Section 1.1(b) shall terminate.



2. CERTAIN OBLIGATIONS




     2.1 Voyager Payment. MAKO hereby purchases from Z-KAT and Z-KAT hereby sells to MAKO
the Voyager Parts owned by Z-KAT, as set forth on Schedule 2.1 (specifically excluding the
actual Voyager System located in Lakewood, Ohio) attached hereto for $[***] (the “Voyager
Payment”).



 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.



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     2.2 Z-KAT Loan. MAKO hereby loans Z-KAT (the “Loan”) the Loan Amount. The Loan
Amount is calculated as follows: (i) the amount required by Z-KAT to pay all anticipated accounts
payable as of the Effective Date as set forth on Schedule 2.2 attached hereto (the “Z-KAT
Payables”); less (ii) twenty thousand dollars ($23,000.00), which is Z-KAT’s anticipated
cash balance just prior to the Effective Date.



          (a) Terms. The Loan shall be evidenced by a Note, in a form identical to that
attached as Exhibit 22 (the “Note”). The Note shall



               (i) accrue interest at a reasonable rate;



               (ii) be payable as a first priority lien against any cash proceeds to Z-KAT or any Affiliate
from a Payment Event, which shall be any or all of the following:



                    (1) receipt of cash (tender of which is unconditioned by payor)
by Z-KAT or any Affiliate as a
result of an Assertion or in consideration for licenses granted or in connection with any claim of
infringement of any intellectual property, less reasonable expenses (attorneys fees, costs,
etc.) actually incurred in connection with the claim and payable to third parties;



                    (2) commercial operations by Z-KAT or any Affiliate (other than
the sale of Z-KAT’s inventory
of fiducial markers), including the contemplated sale of the Lakewood Voyager System;



                    (3) aggregate net proceeds (amounts received less costs and
expenses) in any calendar quarter
from the sale of inventory of fiducial markers;



                    (4) investment or loan into Z-KAT or an Affiliate (provided
however that Z-KAT shall be
entitled to obtain up to $500,000 in cash solely in the form of equity investment or debt, which
shall be used to fund Z-KAT (or an Affiliate) and which shall be exempt from payment towards the
Note);



                    (5) the sale of any MAKO stock held by Z-KAT or any Affiliate; or



                    (6) liquidation/winding up of Z-KAT or any Affiliate.



               (iii) Security Agreement. MAKO, in its sole discretion, may require Z-KAT to
execute
a security agreement with respect to MAKO’s interest in Z-KAT assets to secure a Payment Event.



               (iv) Material Breach. Failure to tender the entire proceeds of a Payment Event to
MAKO upon the occurrence of such Payment Event or Z-KAT’s failure to tender any payment against the
Note when due shall constitute a Material Breach of this Agreement.



3. AGREEMENTS WITH RESPECT TO MAKO EMPLOYEES. Z-KAT agrees that the following restrictions
shall apply to Z-KAT and every Affiliate of Z-KAT as well as to all


  





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.



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MAKO employees employed as of the Effective Date or any time thereafter (each a “MAKO Employee”).



     3.1 General Prohibitions.



          (a) Z-KAT shall not permit a MAKO Employee to be an employee, officer or director of Z-KAT
during such MAKO Employee’s employment and for a six (6) month period following the termination of
such employment with MAKO for any reason (the “Restricted Period”).



          (b) Z-KAT shall not permit a MAKO Employee to provide technical, operational or commercial
services of any kind to Z-KAT (the “Restricted Activities”), except as allowed for under Section
3.2. Notwithstanding the foregoing, nothing contained in this Section 3.1 shall be construed to
limit the statutory and contractual informational rights of any Z-KAT shareholder who is also a
MAKO Employee, nor shall any informal, conversational interactions between Z-KAT and MAKO personnel
be regarded as the rendition of services prohibited hereunder.



          (c) MAKO may require any MAKO Employee to execute an employment agreement or covenant wherein
such MAKO Employee agrees to refrain from the Restricted Activities during the Restricted Period.



          (d) The restrictions set forth in this Section 3.1, including covenants made by MAKO employees
with MAKO restricting them from employment with, or providing services to, Z-KAT shall become void
upon a Change of Control transaction or a Qualified IPO.



     3.2 Limited and Conditioned Consulting Services.



          (a) No MAKO Employee shall be required to render services of any kind to Z-KAT.



          (b) Any MAKO Employee may provide reasonable consultation services to Z-KAT to support any
Assertion or intellectual property licensing endeavor, to provide administrative services, or to
provide Z-KAT personnel with understanding of technical information licensed by MAKO to Z-KAT.



          (c) In a case where a MAKO Employee agrees to provide consultation services to Z-KAT, such
services shall be conditioned as follows (the “Consulting Conditions”):



               (i) rendered only following written notice to and written approval (not to be unreasonably
withheld) by an independent committee of the MAKO Board of Directors;



               (ii) rendered only at such times and under such conditions so as not to have a negative impact
or interference upon MAKO’s business and/or the performance of such MAKO Employee’s duties on
behalf of MAKO (e.g. not rendered during regular business hours); and



 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.



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               (iii) limited to providing consultation, but in no event shall such MAKO Employee create
intellectual property in any form on behalf of Z-KAT, it being expressly agreed by the Parties that
all intellectual property conceived of or developed by any MAKO Employee during the term of his
employment with MAKO shall be and is the property of MAKO (as per the IP assignment covenant
required of every MAKO employee) regardless of the extent to which such intellectual property is
conceived of or developed in connection with consultation by such MAKO Employee on behalf of Z-KAT.



     3.3 Material Breach. In the event that MAKO reasonably demonstrates to Z-KAT that
Z-KAT or a MAKO Employee has violated this Section 3, then such violation shall constitute a
Material Breach.



4. AGREEMENTS WITH RESPECT TO THE TRANSITION OF Z-KAT’S BUSINESS.



     4.1 As of the Effective Date, all of the following shall apply:



          (a) Z-KAT shall establish and maintain a place of business separate and distinct from the MAKO
business address;



          (b) Z-KAT shall not share common workspace or facilities with MAKO;



          (c) The Z-KAT website shall be removed from the MAKO server;



          (d) Z-KAT shall allow, subject to reasonable obligations of confidentiality, MAKO full,
unrestricted access (at MAKO’s expense) to its corporate and financial records (and their
custodians and the professionals managing the same), it being understood by Z-KAT that Z-KAT’s
potential, purported status as a predecessor company to MAKO may require auditing and public
disclosure of the same as MAKO contemplates the possibility of entering the public equity markets



     4.2 For the period commencing as of the Effective Date and concluding no more than one hundred
twenty (120) thereafter (the “Transition Period”), each of Z-KAT and MAKO agree to make best
efforts to completely transfer all business activities (e.g., administrative (legal and accounting)
and commercial (sale of markers)) to Z-KAT personnel (the “Transition”), subject to the following
terms, conditions and restrictions:



          (a) Applicable MAKO personnel shall provide reasonable services at no charge (but subject to
the Consulting Conditions) to assist during the Transition Period;



          (b) Z-KAT will remove all assets and inventory from MAKO’s facility by the conclusion of the
Transition Period.



          (c) Upon reasonable request during the Transition, but in any event before the end of the
Transition Period, MAKO will deliver to or cause to be delivered to Z-KAT, at Z-KAT’s written
request, any or all of the following requested documents:




 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.



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               (i) all financial and legal records relating to Z-KAT in the possession of MAKO and any copies
of all technical documentation owned by Z-KAT in the possession of any of MAKO’s employees,
consultants and advisors (including all information originally provided by Z-KAT to MAKO); and



               (ii) copies of all information (documents, software, etc.) with respect to all Improvements
(as defined in the Z-KAT/MAKO 2004 License), Licensed IP Rights and Technical Information (as those
terms are defined in the Z-KAT/MAKO 2006 License), or other properties that are licensed to Z-KAT.



          (d) During and for a reasonable time following the Transition Period, KAT will have reasonable
access to MAKO personnel (subject to the Consulting Conditions) for purposes of assisting Z-KAT
personnel in understanding the documentation referenced in this Section 4.2.



          (e) Z-KAT may periodically request delivery, and MAKO will delivery or cause to be delivered,
any new information (documents, software, etc.) first created after delivery of information
pursuant to section 4.2(c)(ii) with respect to all Improvements (as defined in the Z-KAT/MAKO 2004
License), Licensed IP Rights and Technical Information (as those terms are defined in the
Z-KAT/MAKO 2006 License), or other properties that are licensed to Z-KAT.



5. FURTHER ACTIONS. From time to time, at the request of any Party hereto, the other Party shall
execute and deliver (or shall cause execution and delivery, by an Affiliate or otherwise) such
instruments and take such action (or cause such action to be taken, by an Affiliate or otherwise)
as may be reasonably requested to evidence the transactions contemplated hereby.



     5.1 [***] IP Asset Purchase. The Parties acknowledge and agree that MAKO has been in
discussions with [***] and/or [***] (along with any implicated Affiliate, [***]) concerning the
purchase of certain intellectual property assets originally transferred from Z-KAT to [***] as part
of the transaction that included the [***]. The Parties agree and covenant that they shall
cooperate in good faith after the Effective Date to endeavor to consummate the purchase of such
intellectual property assets such that each will retain rights in its applicable field and that
that each Party will enjoy rights in such intellectual property assets consistent with those
described in the Z-KAT/MAKO 2004 License.



6. REPRESENTATIONS. Each of Z-KAT and MAKO does hereby represent and warrant to the other
that the execution, delivery and performance of this Agreement and all other documents executed or
to be executed pursuant to this Agreement by such Party (a) have been duly authorized by all
necessary corporate action on the part of such Party; and (b) do not conflict in any material
respect with any of such Party’s charter, bylaws or other controlling corporate documents.



7. GENERAL PROVISIONS.



     7.l GOVERNING LAW; INTERPRETATION; SECTION HEADINGS. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF FLORIDA, WITHOUT REGARD TO




 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.



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CONFLICT-OF-LAWS RULES AS APPLIED IN FLORIDA. THE SECTION HEADINGS CONTAINED HEREIN ARE FOR
PURPOSES OF CONVENIENCE ONLY, AND SHALL NOT BE DEEMED TO CONSTITUTE A PART OF THIS AGREEMENT OR TO
AFFECT THE MEANING OR INTERPRETATION OF THIS AGREEMENT IN ANY WAY.



     7.2 Expenses. Other than as specifically set forth herein to the contrary each Party
shall bear and pay, without any right of reimbursement from any other Party, all costs, expenses
and fees incurred by it or on its or her behalf incident to the preparation, execution and delivery
of this Agreement and the performance of such Party’s obligations hereunder, whether or not the
transactions contemplated in this Agreement are consummated, including, without limitation, the
fees and disbursements of attorneys, accountants and consultants employed by such Party, and shall
indemnify and hold harmless the other Party from and against all such fees, costs and expenses.



     7.3 Notices. All notices and other communications hereunder shall be in writing and
shall be deemed to have been duly given when personally delivered, or forty-eight (48) hours after
sent by United States registered mail, first-class, postage prepaid or by confirmed facsimile
addressed to either Party at its address appearing below or otherwise provided in writing to the
other Party.



     7.4 No Partnership. Neither this Agreement, nor any terms and conditions contained
herein, will be deemed or construed to create a partnership, joint venture, other form of business
enterprise or association or cooperative arrangement, agency relationship, or franchise
relationship between the parties or otherwise to create any liability for either Party whatsoever
with respect to the indebtedness, liabilities, and obligations of the other Party.



     7.5 Severability. Should any provision of this Agreement be held unenforceable or
invalid, then the parties hereto agree that such provision shall be deemed modified for purposes of
performance of this Agreement to the extent necessary to render it lawful and enforceable, or if
such a modification is not possible without materially altering the intention of the parties
hereto, then such provision shall be severed herefrom for purposes of performance of this
Agreement.



     7.6 Entire Agreement. This Agreement and the Exhibits and Schedules hereto set forth
the entire agreement and understanding of the parties hereto with respect to the transactions
contemplated hereby and supersedes all prior agreements, arrangements and understandings related to
the subject matter hereof. Any conflict between this Agreement and an Exhibit shall be resolved in
favor of this Agreement. Unless otherwise defined herein, capitalized terms shall have the same
meaning as described in the ACA.



     7.7 Force Majeure. Neither Party will be in default or otherwise liable for any delay
in or failure of its performance under this Agreement if such delay or failure arises by any reason
beyond its reasonable control, including any act of God, any acts of the common enemy, the
elements, earthquakes, floods, fires, epidemics, riots, failures or delay in transportation or
communications, or any act or failure to act by the other Party or such other Party’s employees,
agents, or independent contractors or representatives; provided, however, that lack of funds will
not be deemed to be a reason beyond a Party’s reasonable control. The parties will promptly




 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.



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inform and consult with each other as to any of the above causes that in their judgment may or
could be the cause of a delay in the performance of this Agreement.



     7.8 Legal Costs. If any action is brought to enforce or interpret the terms of this
Agreement (including through arbitration), the prevailing Party will be entitled to reasonable
legal fees, costs, and disbursements in addition to any other relief to which such Party may be
entitled.



     7.9 Binding Effect; Assignment. All the terms, provisions, covenants and conditions
of this Agreement shall be binding upon and inure to the benefit of and be enforceable by the
parties hereto and their respective heirs, executors, administrators, representatives, successors
and assigns. This Agreement and the rights and obligations of the parties hereto shall not be
assigned or delegated by any Party hereto without the prior written consent of the other parties
hereto, provided however, that this Agreement is assignable to any Affiliate of Party or pursuant
to an event constituting a Change of Control, provided that such assignment is expressly
conditioned on the assignee being subject to the terms and conditions of this Agreement.



     7.10 No Additional Obligations. Unless specifically set forth herein, nothing in this
Agreement shall be construed to require any payment or obligation pursuant to a license or
sublicense that is not already specifically required by such license or sublicense.



     7.11 Execution and Delivery; Counterparts. A facsimile, telecopy or other
reproduction of this Agreement may be executed by either Party hereto and such execution and
delivery shall be considered valid, binding and effective for all purposes. At the request of
either Party the other Party shall execute an original of this Agreement as well as any facsimile,
telecopy or other reproduction hereof. This Agreement may be executed simultaneously in
counterparts, each of which shall be deemed an original, but all of which together shall constitute
one and the same instrument.



[SIGNATURE PAGE FOLLOWS]


 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.




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IN WITNESS WHEREOF, each Party has caused this Agreement to be executed by its duly authorized
representatives on the respective dates entered below.



	 	 	 	 	 
	 	Z-KAT, Inc.

1940 Harrison Street, Suite 300, Hollywood, FL 33020

 	 
	 	By:  	/s/  Christopher Dewey
 	 
	 	 	Name:  	Christopher C. Dewey 	 
	 	 	Title:  	CEO
 	 
	 	 	Date: 	12/28/2006 	 
	 
	 	MAKO Surgical Corp.

2555 Davie Road, Ft. Lauderdale, FL 33317

 	 
	 	By:  	/s/ Maurice Ferré
 	 
	 	 	Name:  	Maurice Ferré 	 
	 	 	Title:  	President and CEO
 	 
	 	 	Date:  	12/28/2006 	 
	 



Attached Schedules & Exhibits




Schedule 2.1 Voyager Parts

Schedule 2.2 Z-KAT Accounts Payable

Exhibit 1.2(a)(i) Sample Engagement Letter

Exhibit 2.2 Note




Appended Exhibits





     [***]


 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.



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Schedule 2.1 Voyager Parts




	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	Extended	 
	 	Quantity	 	 	Description	 	 	Unit Cost	 	 	Cost	 
	 	 	7	 	 	 	Voyager Navigation Carts w/isolation transformer

	 	 	$[***]
	 	 	$[***]	 
	 	 	3	 	 	 	Voyager Navigation Carts w/isolation transformer

(non-satable quality)

	 	 	$[***]
	 	 	$[***]	 
	 	 	3	 	 	 	NEC Touchscreen LCD Monitors

	 	 	$[***]
	 	 	$[***]	 
	 	 	6	 	 	 	NEC LCD Monitors (non touchscreen)

	 	 	$[***]
	 	 	$[***]	 
	 	 	9	 	 	 	P4 Digitizer Cameras

	 	 	$[***]
	 	 	$[***]	 
	 	 	8	 	 	 	Digitizer Pedestal Stands

	 	 	$[***]
	 	 	$[***]	 
	 	 	TOTAL	 	 	 	 

	 	 	 
	 	 	$[***]	 
	 





 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.



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Schedule 2.2 Z-KAT Accounts Payable




	 	 	 	 	 
	Description	 	Amount	 
	Dr. [***] Consulting Fee for 2005
	 	 	35,000	 
	Dr. [***] Consulting Fee for 2006
	 	 	35,000	 
	Marc Hubbard Legal Fees
	 	 	23,500	 
	Foley & Lardner LLP
	 	 	19,307	 
	Wasserstrom Weinreb & Wealcatch PL
	 	 	7,500	 
	Stryker — Cranial Markers
	 	 	28,400	 
	 
	 	 	 	 
	 
	 	 	 
	Total Liabilities
	 	 	148,707	 





 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.



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Exhibit 1.2(a)(i) Sample Engagement Letter




October 27, 2005




General Counsel

Z-KAT, Inc.

2901 Simms St.

Hollywood, FL 33020





			
	           Re:	 	Representation concerning current and future United States Patents assigned to Z-KAT,
Inc.





Dear:




     As we discussed, Z-KAT, Inc. (hereinafter “Z-KAT” or “you”) currently owns or controls certain
patents and patent applications listed on the attached Exhibit A (TO BE COMPLETED). During the
term of this Agreement, Z-KAT may acquire additional patents and patent applications (collectively
hereinafter “the Z-KAT Patents”). Z-KAT has reason to believe that certain entities and/or
individuals may be infringing on one or more of the Z-KAT Patents now or in the future. You have
requested that LAW FIRM represent Z-KAT (the “Representation”) by (1) conducting a preliminary
investigation in an effort to evaluate the infringement and the merits of any such claims (2) if
LAW FIRM concludes after completing its preliminary investigation that LAW FIRM is willing to incur
the risk of pursuing possible claims on Z-KAT’s behalf; then LAW FIRM will assert and pursue claims
on Z-KAT’s behalf for patent infringement and possibly other causes of action against parties for
infringement of the Z-KAT Patents. Therefore, LAW FIRM has agreed to undertake the Representation
subject to and in accordance with the terms, provisions and conditions of this letter agreement.
For convenience, accused infringers are herein sometimes called the “Defendants,” and the subject
of the Representation is herein called the “Matter.”



     Our acceptance of the Representation becomes effective upon your execution and return of the
enclosed copy of this letter (the “Effective Date”). Your claims and causes of action in
connection with the Matter are herein called “Client Claims.” Unless otherwise provided herein, the
Representation may include conducting analysis of the patents and related documents, analyzing the
systems you contend infringe the patent(s), handling licensing (if any), settlement negotiations
(if any), drafting legal documents relating to granting of licenses or settlement with any
Defendant, pretrial investigation and preparation, presentation and defense of applicable motions
(if any), mediation (if any), trial (if any), prosecution or defense of any appeals (if any),
retrial if required as a consequence of any appeal, and prosecution of legal proceedings to
endeavor to collect any judgment obtained in connection with the Matter.



SECTION 1 Terms of Engagement




     This letter sets out the terms of our engagement in the Representation. Certain of those
terms are included in the body of this letter, and additional terms are contained in the attached
document entitled Additional Terms of Engagement. That document is expressly incorporated into
this letter, and it should be read carefully. The execution and return of the enclosed copy of
this


 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.



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letter constitutes an unqualified agreement to all the terms set forth in this letter and in
the attached Additional Terms of Engagement.



     It is understood and agreed that our engagement pursuant to this letter is limited to the
Representation. This letter shall impose no obligation on us to provide legal services other than
those set forth in this letter.



SECTION 2 Our Personnel Who Will Be Working on the Matter




     I will be working on the Matter, and you may call, write, or e-mail me whenever you have any
questions about the Representation. I will be lead counsel in the Matter and will provide you with
regular updates regarding the Representation. Other firm personnel, including firm lawyers and
legal assistants, will participate in the Representation if, in our judgment, their participation
is necessary or appropriate. As soon as those individuals are identified, we will let you know and
you likewise may communicate with them.



SECTION 3 Preliminary Investigation and Discovery in Assisting With the Licensing and Any
Litigation



     As described above, the first stage of the Representation will consist of a preliminary
analysis and investigation to be conducted by LAW FIRM. If a lawsuit is filed, discovery of
documents and information will occur from you and from the applicable Defendants. Even though LAW
FIRM anticipates that it will incur substantial costs and expenses including both time of its
attorneys and other personnel and Other Charges (as hereinafter defined) in the process of
conducting such preliminary analysis, assisting with licensing, and investigation and discovery in
any lawsuit that may be filed, LAW FIRM has informed you that such preliminary analysis and
investigation and information obtained in licensing or discovery cannot be expected to and will not
provide certainty as to whether the Client Claims have merit. Accordingly, you are hereby informed
and hereby acknowledge that a decision by LAW FIRM based on such preliminary investigation that LAW
FIRM is willing to incur the risk of pursuing the Client Claims, and a decision by LAW FIRM to
continue the Representation after obtaining discovery in a lawsuit against one or more Defendants,
will not constitute the expression of an opinion of LAW FIRM or a representation by LAW FIRM that
the Client Claims have merit. To the contrary, in addition to the uncertainties associated with
any trial of controverted facts or disputed legal issues, additional facts or circumstances not
disclosed by the preliminary investigation or initial discovery, additional investigations,
discovery and testimony by technical experts, and complex legal principles of uncertain application
may result in defeating the Client Claims without regard to LAW FIRM’s preliminary conclusions
based on the preliminary investigation or discovery and without regard to what may have transpired
in any licensing efforts.



     At any time during the course of the Representation, LAW FIRM may notify you in writing that
LAW FIRM, in the exercise of its sole judgment and discretion, has concluded on the basis of the
preliminary analysis and investigation, what it has learned or believes as a result of assisting in
the licensing efforts, or based or discovery in any lawsuit, that LAW FIRM is not willing to incur
the risk and cost of pursuing or continuing to pursue the Client Claims against any of the
Defendants under a contingent fee arrangement as set forth hereinafter in this letter agreement and
that LAW FIRM has elected to terminate the Representation in its entirety. If LAW FIRM informs


 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.



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you that LAW FIRM has elected to terminate the Representation in its entirety because it is
not willing to incur the risk of pursuing or continuing to pursue the Client Claims against any of
the Defendants, LAW FIRM shall provide a written summary of the basis for the termination. You
agree that the Representation will terminate immediately and agree to execute such documents and
take such action as is necessary to enable LAW FIRM to withdraw from the Representation. In the
event that LAW FIRM withdraws from the Representation as provided for above in this paragraph (as
distinguished from LAW FIRM’s withdrawal from the Representation for cause as provided for in the
Termination section in the attached Additional Terms of Engagement), LAW FIRM will, of course, be
entitled to be paid or retain its percentage contingent fee and payment or reimbursement of Other
Charges incurred to the date of termination of the Representation out of any recoveries with
respect to the Client Claims that are received (either prior to or after termination of the
Representation) under or pursuant to licenses (if any) that have been executed and delivered
between you and one or more Defendants prior to termination of the Representation, settlement
agreements (if any) that have been executed and delivered between you and one or more Defendants
prior to termination of the Representation, and judgments (if any) that have been entered in favor
of you against one or more Defendants prior to termination of the Representation (excluding any
such judgment as to which an appeal is pending at the time of termination of the Representation or
is thereafter perfected) as provided for in the section of this letter entitled “Our Legal Fees and
Other Charges” below (subject, if applicable, to the provisions of paragraph C of such section);
but LAW FIRM will not be entitled to be paid any percentage contingent fee or other fee for
services or payment or reimbursement of Other Charges out of or with respect to any other
recoveries thereafter received by you after termination of the Representation with respect to the
Client Claims (which other recoveries shall not be deemed to be or be included in “Gross Recovery”
for any purpose under this letter agreement). In the event that LAW FIRM withdraws from the
Representation for whatever reason, you will be provided with a copy of all files created or
controlled by LAW FIRM and pertaining to the Matter and/or the Representation, including all files
containing LAW FIRM’s analysis of the Matter, including the Z-KAT Patents, and LAW FIRM shall
remain obligated to undertake any and all actions reasonably necessary to ensure no prejudice comes
to Z-KAT as a result of such withdrawal by LAW FIRM.



SECTION 4 Our Legal Fees and Other Charges




     A. Fees: In consideration for LAW FIRM’s acceptance of the Representation and for the services
to be performed pursuant to this letter and in lieu of an hourly billing arrangement, you agree to
pay a fee to LAW FIRM (contingent upon what is recovered in the Matter by way of license,
settlement, judgment, or otherwise, and subject, if applicable, to paragraph C below) and hereby
assign and transfer a present and undivided interest to LAW FIRM in and to the the “Gross Recovery”
and “Net Recovery” as defined below, to be computed as follows:




	 	1.	 	[***] of the Net Recovery obtained from any Defendant pursuant to a license or
settlement agreement which is executed and delivered by you and such Defendant where
such Defendant was not sued in any lawsuit filed by LAW FIRM with respect to the Client
Claims;
	 
	 	2.	 	[***] of the Net Recovery obtained from any Defendant who has been sued in a
lawsuit filed by LAW FIRM with respect to the Client Claims pursuant to a license or
settlement agreement which is executed and delivered by you and such




 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.


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	 	 	 	Defendant before the date a Notice of Scheduling Conference is received from the
Court in the initial lawsuit filed by LAW FIRM with respect to Client Claims against
any of the Defendants (but not after that date);
	 
	 	3.	 	except as provided in paragraph 2 above or paragraph 5 below, [***] of the Net
Recovery obtained from any Defendant who has been sued in a lawsuit filed by LAW FIRM
with respect to the Client Claims if the Client Claims against such Defendant are
finally resolved by settlement agreement or license agreement before any party files
any document necessary to commence an appeal to higher court of a final judgment
(subject to appeal) entered in the trial court in such lawsuit, or if no appeal is
commenced from a final judgment (subject to appeal) awarding a recovery to you entered
in the trial court in such lawsuit;
	 
	 	4.	 	except as provided in paragraph 5 below, [***] of the Net Recovery obtained
from any Defendant who has been sued in a lawsuit filed by LAW FIRM with respect to the
Client Claims if the Client Claims against such Defendant are not finally resolved
until after any party files any document necessary to commence an appeal of a final
judgment (subject to appeal) entered in the trial court in such lawsuit; and
	 
	 	5.	 	provided that if and when the total Net Recovery obtained from one or more
Defendants (collectively) exceeds $[***], LAW FIRM’s fee with respect to amounts of the
total Net Recovery obtained from those Defendants or other Defendants (collectively) in
excess of $[***] shall be [***] of the amounts of total Net Recovery in excess of
$[***] (in addition to LAW FIRM’s fee with respect to amounts of Net Recovery up to a
total of $[***] calculated pursuant to paragraphs 1 through 4 above, as applicable),
notwithstanding the provisions of paragraphs 3 and 4 above.





     The applicable percentage fee payable to LAW FIRM as provided above shall be calculated on the
total of the Net Recovery obtained and received from each Defendant. The “Net Recovery” means the
total “Gross Recovery” as hereinafter defined, minus the total of the “Other Charges” as
hereinafter defined. The “Gross Recovery” shall mean a recovery actually obtained and received by
you, or any person or party claiming by, through, or under you, of money or property, real or
personal and tangible or intangible, or any other benefit, by settlement or judgment or otherwise,
on account of any or all of the Client Claims, without deduction of or reduction for “Other
Charges” as hereinafter defined, but subject to the provisions of paragraph C below, if applicable.
Gross Recovery shall include, but not be limited to, royalties or other periodic payments received
under a license or an agreement entered into to settle a dispute with one or more of the
Defendants, except as otherwise provided elsewhere in this engagement agreement or the attached
Additional Terms of Engagement. In the event a court orders payment of attorneys’ fees, costs or
expenses to you or to LAW FIRM as your attorneys in the Matter, the amount of those attorneys’
fees, costs or expenses which are collected shall be included in the “Gross Recovery” for purposes
of calculating the percentage fee payable to LAW FIRM hereunder, but LAW FIRM shall not be entitled
to receive or retain such court-awarded fees in addition to the applicable percentage specified
herein of the total “Net Recovery,” if any, payable to LAW FIRM as a contingent fee hereunder.



 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.


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     If a Gross Recovery received from any Defendant includes securities or some other non-monetary
property or asset, you will have the right, at your election, to treat such securities or other
non-monetary property or asset as the equivalent of money in an amount equal to the fair market
value thereof as of the date of receipt thereof and to make payment in U.S. Dollars to LAW FIRM of
any amounts of such Gross Recovery to which it is entitled under this agreement to pay or reimburse
Other Charges or as LAW FIRM’s applicable percentage fee share of any remaining Net Recovery as
provided for above. Alternatively, you will have the right, at your election, to transfer or
convey to LAW FIRM a share of or interest in such securities or other non-monetary property or
assets having a fair market value as of the date of receipt thereof equal to the amount of such
Gross Recovery to which LAW FIRM is entitled under this agreement to pay or reimburse Other Charges
and to transfer or convey to LAW FIRM its applicable percentage fee share of the remainder, if any
(the “Net Recovery”), of such securities or other non-monetary property or asset. In any instance
when you and LAW FIRM are unable to agree regarding the fair market value of any such securities or
other non-monetary property or assets within thirty (30) days after receipt thereof, it is agreed
that the dispute will be submitted to a non-binding mediation before a mutually agreed upon
mediator in Dallas, Texas. In the event the dispute is not resolved by mediation, the parties
agree to submit the dispute to binding arbitration before a board of three arbitrators in Dallas,
Texas, conducted under the Commercial Arbitration Rules of the American Arbitration Association.



     All amounts of Gross Recovery shall be paid or delivered to LAW FIRM either directly from
Defendants or by Z-KAT promptly upon receipt thereof. LAW FIRM shall hold such Gross Proceeds in
trust for you and shall distribute such Gross Proceeds as promptly as practicable first to apply
toward payment of Other Charges owing to LAW FIRM pursuant to paragraph B below. Any remaining Net
Proceeds shall be distributed to pay the contingent fee owing to LAW FIRM pursuant to this
paragraph A, and the remainder thereof shall be distributed to you.



     B. Charges for Other Services and Expenses: LAW FIRM agrees to advance all charges for other
services and expenses (collectively, “Other Charges”) incurred or provided by LAW FIRM that appear
to LAW FIRM (in reasonable consultation with you) to be reasonably necessary for the preliminary
investigation and, if the Representation has not terminated, the prosecution of the Client Claims
whether through assistance with licensing or through litigation. LAW FIRM shall be authorized to
incur those Other Charges which we deem reasonable and necessary to endeavor to accomplish a
satisfactory resolution of the Matter. It is further agreed that we are expressly authorized to
retain any consultants, experts, or third-party providers that are reasonably necessary in our
judgment in connection with the Representation. If there is no amount of Gross Recovery in the
Matter, you shall have no obligation to pay or reimburse LAW FIRM for arty Other Charges incurred,
charged or expended by LAW FIRM, and you shall have no obligation to pay or reimburse LAW FIRM for
any amount of Other Charges in excess of whatever amounts of Gross Recovery are actually recovered.
In this regard, however, if any amounts of a Gross Recovery from any Defendant or Defendants have
been deemed to be a “Net Recovery” and have been distributed to you and LAW FIRM as provided for in
paragraph A above and LAW FIRM thereafter incurs or expends Other Charges (“Unpaid Other Charges”)
that are not paid or reimbursed to LAW FIRM out of amounts of Gross Recovery from one or more
Defendants thereafter obtained and received, and if (and only if) the total amounts of Net Recovery
theretofore distributed to you (as your share thereof) pursuant to paragraph A above exceed [***],
you will be obligated to pay or reimburse to LAW FIRM a portion (hereinafter described as the
“Refundable



 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.


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Portion”) of the amount of such Unpaid Other Charges that has not been paid or reimbursed to
LAW FIRM upon termination of the Representation out of the amounts of “Net Recovery” from any
Defendant or Defendants (collectively) in excess of [***] that have been distributed to you
pursuant to said paragraph A. The “Refundable Portion” of Unpaid Other Charges that you may thus
become obligated to pay to LAW FIRM out of amounts of “Net Recovery” distributed to you pursuant to
paragraph A above shall be equal to the aggregate amount (up to all thereof) by which the amounts
of “Net Recovery” in excess of a total of [***] distributed to you pursuant to said paragraph A
would have been reduced if such Unpaid Other Charges had been paid and deducted from the applicable
amounts of Gross Recovery before dividing the remainder thereof as “Net Recovery” between LAW FIRM
and you as provided for in said paragraph A. Other Charges may include, without limitation,
charges or expenses made in furtherance of the Matter for long-distance telephone calls, facsimile
and other electronic transmissions, messenger and other delivery fees, postage, charges for
computer research and outside assisted legal research, travel expenses such as mileage, parking,
airfare, meals, and hotel accommodations, photocopying and other reproduction charges, conference
expenses, clerical staff overtime, word processing charges, charges for computer time, process
server’s fees, filing fees and other charges assessed by courts and other public agencies, court
reporter’s fees, videographer’s fees, jury fees, witness fees, investigator’s fees, trial
presentation expenses, expert’s fees, or consultant’s fees, and other similar items. In situations
where we can readily determine the exact amount of expenses for products and services provided by
third parties to be charged to your account, our charges for Other Charges will reflect the cost to
us of the product or services. In many situations, however, the total cost of providing a product
or service is difficult to establish, in which case we will use our reasonable professional
judgment as to the charges to be made for such product or service, which charges shall not
substantially vary from or exceed our direct cost of such product or service. Attached is a copy
of our current recharge schedule for expenses and services provided through our Dallas, Texas,
office, which is subject to change from time to time. Charges for expenses and services provided
through other offices of our firm may vary from the attached Dallas office recharge schedule. LAW
FIRM agrees that it will send monthly statements to you that summarize the Other Charges expended
or incurred and charged to your file to date.



     It is expressly agreed, that if LAW FIRM elects to and does engage other attorneys or law
firms (who, we anticipate, would serve as local counsel) to assist LAW FIRM in connection with
litigation against or pursuing Client Claims against any Defendant or Defendants, the legal fees
charged by such attorneys or law firms for their services shall not be deemed to be “Other
Charges,” and LAW FIRM shall be solely responsible for payment of such fees on such basis and in
such manner or amount as may be agreed between LAW FIRM and such attorneys or law firms. However,
any expenses and charges for supplies or services other than legal services of the nature of “Other
Charges” described above that are incurred or expended by any such attorneys or law firms in
connection with the Matter and paid or reimbursed by LAW FIRM shall be deemed to be “Other Charges”
for purposes of this agreement.



     C. Declining or Withdrawing From Representation as to Particular Defendants or With Respect to
Appeal From or Retrial Following an Adverse Trial Court or Appellate Decision: As described in the
section of this letter agreement entitled “Conflicts of interest” below, LAW FIRM may decline to
represent you in asserting Client Claims against particular potential infringers who might be
Defendants, based on a conflict of interest that would exist if LAW FIRM undertook such
representation. If LAW FIRM notifies you that it will not represent you in



 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.


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asserting Client Claims against a particular potential infringer because of a conflict of
interest, you will, of course, have the right to pursue the Client Claims against such party for
your own account and at your own expense using other counsel of your choice, and no amount of any
recovery you may obtain from such party shall be included in or shall be deemed to be a “Gross
Recovery” for any purpose under this agreement.



     Likewise, at any time during the course of the Representation, LAW FIRM may notify you that on
the basis of the information it has obtained it has determined that it is not willing to incur the
risk and cost of pursuing or continuing to pursue the Client Claims as against a particular
Defendant on a contingent fee basis (either because LAW FIRM believes that evidence of infringement
by the Defendant may be inconclusive, that the amount of any likely recovery from the Defendant
would not justify the cost and risk, or that collection of a recovery from the Defendant may be
doubtful, or for any other reason deemed appropriate in LAW FIRM’s judgment). If LAW FIRM provides
such a notice to you with respect to a particular Defendant, the Representation will immediately
terminate insofar only as to that particular Defendant, and you agree to execute such documents and
take such action as is necessary to enable LAW FIRM to withdraw from the Representation insofar as
to such particular Defendant. In that event, you will, of course, have the right to pursue the
Client Claims against such Defendant for your own account and at your own expense using other
counsel of your choice, and no amount of any recovery you may obtain from such Defendant shall be
included in or shall be deemed to be a “Gross Recovery” for any purpose under this agreement.



     In the event a trial court ruling on an appealable dispositive motion is entered, or a trial
court judgment is entered following a trial, or in the event an appellate court decision is
rendered in an appeal, LAW FIRM shall have the right, but not the obligation, to continue to
represent you in any appeal or appeals of such ruling, judgment, or decision or in any retrial
required by any such decision. LAW FIRM shall have complete discretion in deciding whether it will
participate in any such appeal or retrial.



     In the event LAW FIRM elects not to participate in any appeal or retrial and you elect to go
forward with an appeal or retrial with other counsel and obtain and receive a recovery from any
Defendant who is a party to such lawsuit during or after the appeal or retrial, then
(notwithstanding the fact that such recovery will not be deemed to be included in or to be “Gross
Recovery” for purposes of this agreement), within thirty (30) days after request by LAW FIRM, you
shall meet with LAW FIRM to negotiate an agreement addressing LAW FIRM’s fees for its services
through the trial and any appeal and payment for Other Charges. If after thirty (30) days you and
LAW FIRM are unable to reach an agreement in this regard, then the parties agree to submit the
dispute to a non-binding mediation before a mutually agreed-upon mediator in Dallas, Texas. In the
event the dispute is not resolved by mediation, the parties agree to submit the dispute to binding
arbitration before a board of three arbitrators in Dallas, Texas, conducted under the Commercial
Arbitration Rules of the American Arbitration Association and agree that the arbitrators shall be
directed to determine and award to LAW FIRM such amount (if any) of the following to which the
arbitrators determine LAW FIRM is entitled on a quantum meruit basis for its services and charges
and expenses in connection with the trial and any appeals: (1) Other Charges; and (2) LAW FIRM’s
fees for its services performed through the trial and any appeal.



 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.


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SECTION 5 Taxable Court Costs or Other Expenses




     In the event a trial or appellate court awards taxable court costs, attorneys fees’ or any
other expenses against you in connection with a judgment rendered in the Matter, you are solely
responsible for any such costs, fees or expenses which may be owing to an adverse party, except
where such costs, fees or expenses are awarded based on the acts or omissions of LAW FIRM, in which
case they will be paid by LAW FIRM.



SECTION 6 Conflicts of Interest




     Before accepting the Representation, we have undertaken reasonable and customary efforts to
determine whether there are any potential conflicts of interest that would bar our firm from
representing you in the Matter. Based on the information available to us, we are not aware of any
potential conflict of interest that might bar our firm from representing you in the Matter against
a number of the potential infringers. Because of the number of potential infringers, we may have
some conflicts which prevent us from pursuing those parties and we will not pursue those parties as
to whom we determine that a conflict of interest would exist if we pursued Client Claims against
such parties. In reviewing the issue of potential conflicts of interest, we have reviewed the
issue in accordance with the rules of professional responsibility adopted in Texas and principles
applied by Federal Courts sitting in Texas regarding disqualification of counsel based on conflicts
of interest. We believe that the rules of professional conduct adopted in Texas, rather than the
rules of any other jurisdiction, are applicable to the Representation, and the execution and return
of the enclosed copy of this letter by your son s an express am to the applicability of those
rules.



     Exclusions from List of Defendants



     With the exception of those entities set forth in Exhibit B hereto (which may or may not be
potential infringers), which such entities are specifically excluded as Defendants under this
agreement and as to which you have and shall retain the right to determine whether or not to pursue
the Client Claims for your own account and at your own expense using other counsel of your choice,
and for which no amount of any recovery you may obtain shall be included in or shall be deemed to
be a “Gross Recovery” for any purpose under this agreement, as of the date of this agreement there
are no individuals and entities known by the either LAW FIRM or you to be excluded from the pool of
potential Defendants under this agreement.



SECTION 7 Consultation Regarding Settlement, Licensing, and Other Decisions




     You agree that you will consult with us in advance concerning any proposed settlement or
licensing agreement with or abandonment of the Client Claims against any of the Defendants with
respect to whom we are representing you, and we will endeavor to provide our advice concerning such
matters to assist you in determining whether to offer or propose or acceptor reject any such
proposed settlement or licensing agreement or abandon the Client Claims against any such Defendant.
However, we will not be authorized to execute any settlement or license agreement without your
express written authority; and all license agreements, settlements, decisions to abandon the Client
Claims and decisions to proceed with or abandon litigations and/or appeals shall be subject to your
consent, approval, and sole discretion.



 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.


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Regular Reporting LAW FIRM agrees to provide you with written monthly reporting of (1) all Other
Charges incurred and/or paid and (2) services our firm rendered as part of the Representation for
the preceding month.



SECTION 8 Independent Representation




     You represent and acknowledge that you have consulted with and been advised by legal counsel
of your own choice unrelated to LAW FIRM concerning the terms and provisions and form and content
of this letter agreement and the attached Additional Terms of Engagement before executing or
agreeing to this agreement.



SECTION 9 180 Days




     If LAW FIRM shall endeavor to provide you with the results of its preliminary investigation as
soon as possible but in no event later than one hundred eighty (180) days from the commencement of
the Engagement, and should LAW FIRM fail to file an action against any Defendant within one hundred
eighty (180) days from the Effective Date of this engagement letter, then you shall have the right
to terminate this engagement letter by giving written notice of termination to LAW FIRM at any time
prior to the time that LAW FIRM does take action on any Defendant, in which event you will owe no
fees or Other Charges to LAW FIRM.



SECTION 10 Client and Investor Meeting




     It is expressly stipulated that before a final decision is made to file any lawsuit against
any Defendant asserting the Client Claims, LAW FIRM will require a meeting in Dallas, Texas (or an
alternate location acceptable to LAW FIRM), with you and any material inventors and/or assignees of
material patents to be asserted, in order to discuss an overall strategy for pursuit of the Client
Claims and explore any areas of possible concern regarding the nature of and continuation of the
Representation in a face to face meeting. Expenses associated with any such meeting shall be paid
by LAW FIRM and treated as Other Expenses under this agreement.LAW FIRM agrees to work with you to
reasonably identify those persons reasonably necessary for participation in said meeting, some of
whom may be allowed to attend telephonically should circumstances allow.



SECTION 11 Conclusion




     This letter and the attached Additional Terms of Engagement constitute the entire term of the
engagement of LAW FIRM in the Representation. These written terms of engagement are not subject to
any oral agreements or understanding s, and they can be modified only by further written agreement
signed both by you and LAW FIRM. Unless expressly stated in these terms of engagement, no
obligation or undertaking shall be implied on the part of either you or LAW FIRM.



     Please carefully review this letter and the attached Additional Terms of Engagement. If there
are any questions about these terms of engagement, or if these terms are inaccurate in any way,
please let me know immediately. If both documents are acceptable, please sign and return the
enclosed copy of this letter, so that we may commence the Representation. We have signed the
letter on this date. If this letter is not signed and retuned on of before November [ ], 2005,
the



 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.


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offer of representation and terms and conditions of this letter are null, void and of no force
or effect. Thank you for the opportunity to be of service.



Sincerely,




AGREED:




Date:                      
                      




	 	 	 	 	 
	 	 
	By:  	 	 
	 	 	 
	 	 	 
	 



 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.



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LAW FIRM.




Additional Terms of Engagement





     This is a supplement to our engagement letter dated November [ ], 2005, with you. Terms
which are defined in the engagement letter will have meaning therein stated when used in this
supplement. The purpose of this document is to set out additional terms of our agreement to
provide the Representation described in our engagement letter concerning the Matter described
therein. Because these additional terms of engagement are a part of our agreement to provide legal
services, you should review them carefully and should promptly communicate to us any questions
concerning this document We suggest that you retain this statement of additional terms along with
our engagement letter and any related dements.



SECTION 12 The Scope of the Representation




     As lawyers, we undertake to provide representation and advice on the legal matters for which
we are engaged. It is important for our clients to have a clear understanding of the legal
services that we have agreed to provide. Thus, if there are any questions about the scope of the
Representation that we are to provide in the Matter, please raise those questions promptly, so that
we may resolve them at the outset of the Representation.



     You acknowledge that we have made no promises or guarantees to you regarding the outcome of
the Representation or the Matter, and nothing in the engagement letter or these additional terms of
engagement shall be construed as such a promise or guarantee. Any expressions on our part
concerning the outcome of the Representation, or any other legal matters, are based on our
professional judgment and are not guarantees. Such expressions, even when described as opinions,
are necessarily limited by our knowledge of the facts and are based on our views of the state of
the law at the time they are expressed.



     Upon accepting this engagement on your behalf, LAW FIRM agrees to do the following: (1)
provide legal counsel in accordance with the additional terms of engagement and the related
engagement letter, and in reliance upon information and guidance provided by you; and (2) keep you
reasonably informed about the status and progress of the Representation.



     To enable us to provide effective representation, you agree to do the following: (1) disclose
to us, fully and accurately and on a timely basis, all facts and documents that are or might be
material or that we may request, (2) keep us apprised on a timely basis of all developments
relating to the Representation that are or might be material, (3) attend meetings, conferences, and
other proceedings when it is reasonable for you to do so and (4) otherwise cooperate fully with us.



     Our firm has been engaged to provide legal services in connection with the Representation in
the Matter, as specifically defined in our engagement letter. After completion of the
Representation, changes may occur in the applicable laws or regulations that could affect your
future rights and liabilities in regard to the Matter. Unless we are actually engaged after the
completion of the Representation to provide additional advice on such issues, the firm has no
continuing obligation to give advice with respect to any future legal developments that may pertain
to the Matter.



 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.


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     It is our policy and your agreement that the party we represent is the one identified in our
engagement letter and that our attorney-client relationship does not include any related persons or
entities. Far example, if a corporation, partnership, or other organization is identified as our
client in our engagement letter referenced above, we do not represent any related parent companies,
subsidiaries, affiliates, employees, officers, directors, shareholders, partners, members,
commonly-owned corporations or partnerships, or other such persons, entities, or affiliates,
whether now existing or hereafter becoming such by virtue of merger, dissolution, acquisition, or
any other means. Accordingly, it is understood that we may represent another client with interests
adverse to any such affiliated or related person or entity without first obtaining consent from
you.



SECTION 13 Who Will Provide the Legal Services




     As our engagement letter confirms, LAW FIRM will represent you in the Matter. LAW FIRM is a
registered limited liability partnership pursuant to the Texas Revised Partnership Act.



     Although our firm will be providing legal services, each client of the firm customarily has a
relationship principally with one attorney, or perhaps a few attorneys. At the same time, however,
the work required in the Representation, or parts of it, may be performed by other firm personnel,
including lawyers and legal assistants. Such delegation may be for the purpose of involving other
firm personnel with experience in a given area or for the purpose of providing services on an
efficient and timely basis.



SECTION 14 Our Relationships With Others




     Our law firm represents many companies and individuals. In some instances, the applicable
rules of professional conduct may limit our ability to represent clients with conflicting or
potentially conflicting interests. Those rules of conduct often allow us to exercise our
independent judgment in determining whether our relationship with one client prevents us from
representing another. In other situations, we may lie permitted to represent a client only if the
other clients consent to that representation.



     Rules concerning conflicts of interest vary with the jurisdiction. In order to avoid any
uncertainty, it is our policy that the governing rules will be those applicable to the particular
office of our firm that prepares the engagement letter for a particular matter. The acceptance by
you of our engagement letter constitutes as express agreement with that policy, unless the
engagement letter specifically states that some outer rules of professional responsibility will
govern our attorney-client relationship.



     If a controversy unrelated to the Matter develops between you and any other client of the
firm, we will follow the applicable rules of professional responsibility to determine whether we
may represent either you or the other client in the unrelated controversy.



     In addition to our representation of other companies and individuals, we also regularly
represent lawyers and law firms. As a result, opposing counsel in the Matter may be a lawyer or
law firm that we may represent now or in the future. Likewise, opposing counsel in the Matter may
represent our firm now or in the future. Further, we have professional and personal relationships
with many other attorneys, often because of our participation in bar associations and other
professional organizations. It is our professional judgment that such relationships with other


 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.



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attorneys do not adversely affect our ability to represent any client. The acceptance of
these terms of engagement represents an unqualified consent to any such relationships between our
firm and other lawyers or law firms, even counsel who is representing a party that is adverse to
you in the Matter that is the subject of this engagement or in sonic other matter.



SECTION 15 Termination




     At any time, you may, with or without cause, terminate the Representation by notifying us of
your intention to do so. If you terminate the Representation without cause, LAW FIRM shall retain
the right to receive payment out of any Gross Recovery thereafter received by you (up to the full
amount of such Gross Recovery) of all Other Charges incurred, charged or expended by LAW FIRM in
connection with the Representation or which are incurred, charged or expended in connection with an
orderly transition of the Matter, together with the full contingent fee share of any Net Recovery
received by you. If LAW FIRM is discharged by you for cause, LAW FIRM may not be entitled to
compensation or payment for its services or Other Charges in connection with the Representation or
may be entitled to compensation or payment for such services or Other Charges on a quantum meruit
basis as may be appropriate in the circumstances under the applicable laws and code or rules of
professional conduct.



     We are subject to the codes or rules of professional responsibility for the jurisdictions in
which we practice. There are several hypes of conduct or circumstances that could justify and
result in our withdrawing from representing a client, including, for example, the following:
misrepresentation or failure to disclose material feeds: fraudulent or criminal conduct; and
action contrary to our advice. The right of LAW FIRM to withdraw with justification as described
herein is in addition to any rights to withdraw with justification created by statute or recognized
by the governing rules of professional conduct. We try to identify in advance and discuss with our
clients any situation that may lead to our withdrawal. If LAW FIRM withdraws from the
Representation, then, except as and unless otherwise provided in our engagement letter, LAW FIRM
shall retain the right to receive payment out of any Gross Recovery theretofore or thereafter
received by you (up to the full amount of such Gross Recovery) of all other Charges incurred,
charged or expended by LAW FIRM in connection with the Representation or which we incurred, charged
or expended in connection with an orderly transition of the Matter, and LAW FIRM may be entitled to
compensation for its services on a quantum meruit basis out of any Net Recovery (as defined in the
engagement letter) as may be appropriate in the circumstances under the applicable laws and code or
rules of professional conduct. Further, you will promptly take all steps necessary too release LAW
FIRM of any further obligations in the Representation or the Matter, including, without limitation,
the execution of any documents necessary to effectuate LAW FIRM’s withdrawal from the
Representation and the Matter.



     In the event that LAW FIRM notifies you that it believes it is entitled to compensation or
payment for its services or Other Charges in connection with the Representation on a quantum meruit
basis following termination of the Representation for cause, you and LAW FIRM will endeavor in good
faith to agree upon such amount (if any) as is mutually acceptable to the parties. If after thirty
(30) days you and LAW FIRM are unable to reach an agreement in this regard, their the parties agree
to submit the dispute to a non-binding mediation before a mutually agreed-upon mediator in Dallas,
Texas. In the event the dispute is not resolved by mediation, the parties agree to submit the
dispute to binding arbitration before a board of three arbitrators in Dallas, Texas,



 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.


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conducted under the Commercial Arbitration Rules of the American Arbitration Association and
agree that the arbitrators shall be directed to determine and award to LAW FIRM such amount (if
any) of fees for its services and (if not otherwise provided for in these Additional Terms of
Engagement) payment or reimbursement for Other Charges to which the arbitrators determine LAW FIRM
is entitled on a quantum meruit basis.



SECTION 16 Document Retention




     At the close of any matter, we send our flies in that matter to a storage facility for storage
at our expense. The attorney closing the file determines how long we will maintain the files in
storage. After that time, we will destroy the documents in the stored files.



     Upon termination of the Representation, we return to the client any documents and files that
are subject to the agreement with such client or are specifically requested to be returned. As to
any documents so returned, we may elect to keep a copy of the documents in our stored files.



SECTION 17 Severability




     If any term or provision of the engagement letter or these additional terms of engagement is
finally determined by any court, arbitrator, or other tribunal to be void or unenforceable in whole
or in part or as to any person, party, or circumstance, the engagement letter and these additional
terms of engagement shall nevertheless be and remain valid and enforceable as to all terms and
provisions thereof and as to all persons, parties, or circumstances as to which they are not thus
determined to be void or unenforceable; and, notwithstanding any such determination, the engagement
letter and these additional terms of engagement shall be and remain valid and shall be enforced, as
to each term and provision thereof, to the maximum extent permitted by applicable laws and rules of
professional conduct.



SECTION 18 Governing Law




     The engagement letter and these additional teems of engagement shall be construed and enforced
in accordance with the laws of the State of Texas applicable to contracts made in and to be
performed in Texas, without giving effect to conflicts of law principles that might require
application of the laws of any other jurisdiction.



SECTION 19 Ownership of Client Claims/Grant of Lien




     Each of LAW FIRM and you acknowledge and repent that you own 100% of the Client Claims. You
hereby grant a first priority lien to LAW FIRM on any Gross Recovery received or recovered by you
or any party claiming by, through, or under you, to secure payment of the fees, if any, and Other
Charges, if any, becoming payable from you to LAW FIRM as provided for in the engagement Letter
agreement and these additional terms of engagement. Such lien will be in addition to all other
rights of LAW FIRM to receive sums if any owing from you under the engagement letter agreement and
these additional terms of engagement. You hereby represent and warrant to LAW FIRM that there are
no other known outstanding liens on the Client Claims or Gross Recovery.


 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.



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SECTION 20 Standards of Professionalism and Attorney Complaint Information




     Pursuant to rules promulgated by the Texas Supreme Court and the State Bar of Texas, we are to
advise our clients of the contents of the Texas Lawyer’s Creed, a copy of which is attached. In
addition, we are to advise clients that the State Bar of Texas investigates and prosecutes
complaints of professional misconduct against attorneys licensed in Texas. A brochure entitled
Attorney Complaint Information is available at all of our Texas offices and is likewise available
upon request. A client that has any questions about the State Bar’s disciplinary process should
call the Office of the General Counsel of the State Bar of Texas at 1-800-932-1900 toll free




 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.


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Exhibit 2.2




SECURED PROMISSORY NOTE






$125,707.00







Broward County,

Florida

December 28, 2006









FOR VALUE RECEIVED, the undersigned, Z-KAT, INC. a Florida corporation promises to pay to MAKO
SURGICAL CORP., a Delaware corporation, and its successors and assignees (the “Holder”), at 2555
Davie Road, Ft. Lauderdale, Florida 33317 or such other place as the Holder may designate in
writing to the Maker, the principal sum of $One Hundred Twenty Five Thousand Seven Hundred
Seven Dollars ($125,707), with interest at an annual rate of eight and one half percent (8.5)%
compounded annually.



     This Note is issued pursuant to the Addendum to Asset Contribution Agreement, dated effective
as of December 28, 2006 (the “Agreement”), among the Maker and the Holder The covenants and
agreements under the Agreement are incorporated in this Note. Capitalized terms not otherwise
defined in this Note shall have the meanings ascribed to them in the Agreement.



     The Maker shall make payment (each a “Required Payment”) of principal and interest to retire
the outstanding balance of principal and interest on this Not from any and all cash received
(tender of which is unconditioned by payor) by Z-KAT or any Affiliate from a Payment Event (as
defined in the Agreement).



     This Note may be prepaid in whole or in part at any time and from time to time without prior
notice to the Holder. All payments hereunder shall be applied first to accrued interest and then
to principal.



     Time is of the essence with respect to the payment of this Note. If this Note is not tally
paid at maturity (including all additions accruing under the term herein whether the stated
maturity date, by acceleration, or otherwise), the unpaid balance of principal shall earn interest,
and shall be payable on demand, at the maximum rate allowed by law.



     This Note is secured by certain assets of the Holder as described more fully in the Agreement
and any other liens and security interests provided for in the Agreement Reference is made to the
Agreement as to various obligations and duties of the Maker and to various matters which shall
entitle the Holder hereof to accelerate the indebtedness evidenced by this Note. The Holder is
entitled to the benefit of the liens and security provided by the Agreement, and the covenants and
agreements of the Maker under the Agreement are incorporated in this Note.



     Upon the nonpayment of any Required Payment installment of principal or interest within 5
business days after receipt by the Maker of written notice from the Holder that the Maker has
failed to make the payment when due, or the occurrence of a “Material Breach” as defined in the
Agreement, the entire unpaid principal of and accrued interest on this Note shall, at the option of
the Holder, become due and payable immediately. It is further agreed that failure of the Holder to
exercise this right of accelerating the maturity of the debt, or any indulgence granted from time
to



 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.


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time, shall in no event be considered as a waiver of such right of acceleration or estop the
Holder from exercising such right.



     The Maker agrees to pay all costs and expenses incur ed by the Holder in connection with the
collection of this Note, including reasonable attorneys’ fees and expenses (whether or not suit is
filed, and if suit is fled, all those costs and expenses, including attorneys’ fees, incurred in
any primary and appellate proceedings).



     In no event shall the amount of interest due or payable under this Note exceed the maximum
rate of interest allowed by applicable law, as amended from time to time. If any payment of
interest or in the nature of interest would, under, applicable law, cause the foregoing interest
rate limitation to be exceeded, then the excess payment shall be credited as a payment of
principal, unless the Maker notifies the Holder that the Maker desires to have the excess sum
returned to the Maker.



     All notices, demands, and other communications required or permitted in connection with this
Note shall be in writing and shall be deemed to have been given when delivered or sent by
first-class, postage prepaid, certified mail, with return receipt requested (regardless of whether
the return receipt is received by the sender) and addressed, if to the Maker, at the mailing
address provided in the Agreement, and if to the Holder, at the address specified in the first
paragraph of this Note, or at such other addresses as the Maker and the Holder may designate to
each other in writing.



     This Note shall be governed by, and construed and enforced under, the laws of Florida. Maker
consents and agrees that Broward County, Florida, shall be the exclusive, proper, and convenient
venue for any legal proceeding in federal or state court relating to this Note, and Maker waives
any defense, whether asserted by motion or pleadings, that Broward County, Florida, is an improper
or inconvenient venue. The Maker and every other party liable at any time for payment of this Note
waives presentment, demand, test, notice of protest, and notice of dishonor.



     IN WITNESS WHEREOF, the Maker has executed this Note the date first stated above.



	 	 	 	 	 
	 	ZKAT, Inc.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



“Maker”





 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.


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SECURED PROMISSORY NOTE






$125,707.00







Broward County,

Florida

December 28, 2006









FOR VALUE RECEIVED, the undersigned, Z-KAT, INC. a Florida corporation promises to pay to MAKO
SURGICAL CORP., a Delaware corporation, and sits successors and assignees (the “Holder”), at 2555
Davie Road, Ft. Lauderdale, Florida 33317 or such other place as the Holder may designate in
writing to the Maker, the principal sum of $One Hundred Twenty Five Thousand Seven Hundred
Seven Dollars ($125,707), with interest at an annual rate of eight and one half percent (8.5)%
compounded annually.




     This Note is issued pursuant to the Addendum to Asset Contribution Agreement, dated effective
as of December 28, 2046 (the “Agreement”), among the Maker and the Holder The covenants and
agreements under the Agreement are incorporated in this Note. Capitalized terms not otherwise
defined in this Note shall have the meanings ascribed to them in the Agreement.



     The Maker shall make payment (each a “Required Payment”) of principal and interest to retire
the outstanding balance of principal and interest on this Note from any and all cash received
(tender of which is unconditioned by payor) by Z-KAT or any Affiliate from a Payment Event (as
defined in the Agreement).



     This Note may be prepaid in whole or in part at any time and from time to time without prior
notice to the Holder. All payments hereunder shall be applied first to accrued interest and then
to principal.



     Time is of the essence with respect to the payment of this Note. If this Note is not fully
paid at maturity (including all additions accruing under the term herein whether the stated
maturity date, by acceleration, or otherwise), the unpaid balance of principal shall earn interest,
and shall be payable on demand, at the maximum rate allowed by law.



     This Note is secured by certain assets of the Holder as described more fully in the Agreement
and any other liens and security interests provided for in the Agreement. Reference is made to the
Agreement as to various obligations and duties of the Maker and to various matters which shall
entitle the Holder hereof to accelerate the indebtedness evidenced by this Note. The Holder is
entitled to the benefit of the liens and security provided by the Agreement, and the covenants and
agreements of the Maker under the Agreement are incorporated in this Note.



     Upon the nonpayment of any Required Payment installment of principal or interest within 5
business days after receipt by the Maker of written notice from the Holder that the Maker, has
failed to make the payment when due, or the occurrence of a “Material Breach” as defined in the
Agreement, the entire unpaid principal of and accrued interest in this Note shall, at the option of
the Holder, become due and payable immediately. It is further agreed that failure of the Holder to
exercise this right of accelerating the maturity of the debts or any indulgence granted from time
to time, shall in no event be considered as a waiver of such right of acceleration or estop the
Holder from exercising such right.



 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.


-31-









 





     The Maker agrees to pay all costs and expenses incurred by the Holder in connection with the
collection of this Note, including reasonable attorneys’ fees and expenses (whether or not suit is
filed, and if it is filed, all those costs and expenses, including attorneys’ fees, incurred in any
primary and appellate proceedings).



     In no event shall the amount of interest due or payable under this Note exceed the maximum
rate of interest allowed by applicable law, as amended from time to time. If any payment of
interest or in the nature of interest would, under applicable law, cause the foregoing interest
rate limitation, to be exceeded, then the excess payment shall be edited as a payment of principal,
unless the Maker notifies the Holder that the Maker desires to have the excess sum returned to the
Maker.



     All notices, demands, and other communications required or permitted in connection with this
Note shall be in writing and shall be deemed to have been given when delivered or sent by
first-class, postage prepaid, certified mail, with return receipt requested (regardless of whether
the return receipt is received by the sender) and addressed, if to the Maker, at the mailing
address provided in the Agreement, and if to the Holder, at the address specified in the first
paragraph of this Note, or at such other addresses as the Maker and the Holder may designate to
each other in writing.



     This Note shall be governed by, and construed and enforced under, the laws of Florida. Maker
consents and agrees that Broward County, Florida, shall be the exclusive, proper, and convenient
venue for any legal proceeding in federal or state court relating to this Note, and Maker waives
any defense, whether asserted by motion or pleadings, that Broward County, Florida, is an improper
or inconvenient venue. The Maker and every other party liable at any time for payment of this Note
waives presentment, demand, protest, notice of protest, and notice of dishonor.



     IN
WITNESS WHEREOF, the Maker has executed this Note the date first stated above.



	 	 	 	 	 
	 	ZKAT, Inc.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



“Maker”





 





[***] Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as [***]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.


-32-