Document:

exv10w22

 

Exhibit
10.22

LICENSE AGREEMENT

     THIS LICENSE AGREEMENT (this “Agreement”) is made and entered into as of July 21, 2003
(the “Effective Date”) between VOLCANO THERAPEUTICS, INC. (as defined below, “Volcano”), a Delaware
corporation, and AVE GALWAY LIMITED (as defined below, “Medtronic”), a corporation existing under
the laws of the Republic of Ireland.

RECITALS

     WHEREAS,
pursuant to an Asset Purchase Agreement dated as of July 21, 2003,
(the “APA”)
Volcano has acquired substantially all of the assets associated with the functional measurement
and IVUS businesses of JOMED, Inc. and its Affiliates (the “JOMED Acquisition”);

     WHEREAS, in connection with the JOMED Acquisition, Volcano has hired 22 engineers who, prior
to the JOMED Acquisition, were employed or retained by JOMED, Inc. or its Affiliates in the IVUS
businesses of JOMED, Inc. (the “JOMED Engineers”); a list of the JOMED Engineers, including the
address, telephone number and rate of pay of each JOMED Engineer, is set forth as Exhibit A;

     WHEREAS, simultaneous with the closing of the JOMED Acquisition, Volcano and Medtronic will
enter into a Supply Agreement, an Option to Distribute Agreement and a Right of First Negotiation
and First Refusal Agreement and this Agreement; and

     WHEREAS, the parties desire to enter into this agreement under which Volcano shall grant
Medtronic a license relating to certain assets associated with the JOMED Acquisition.

AGREEMENT

     NOW, THEREFORE, in consideration of the respective representations, warranties,
covenants and agreements contained herein, and for other valuable consideration, the receipt and
adequacy of which is hereby acknowledged, the parties hereto agree as follows:

ARTICLE 1

DEFINITIONS

     1.1
Specific Definitions. As used in this Agreement, the following terms shall
have the meanings set forth or as referenced below:

     “Affiliate” of a specified person (natural or juridical) means a person that directly, or
indirectly through one or more intermediaries, controls, or is controlled by, or is under common
control with, the person specified. “Control” shall mean ownership of more than 50% of the shares
of stock entitled to vote for the election of directors in the case of a corporation, and more
than 50% of the voting power in the case of a business entity other than a corporation.

     “Agreement” means this Agreement and all Exhibits and Schedules hereto.

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     “Confidential Information” means any written or tangible information of one of the
parties (the “disclosing party”) which is disclosed to the other party (the “receiving party”)
that is not generally known to the public and that is marked or identified as “Confidential,”
“Proprietary” or the like, including, without limitation, trade secrets and know-how,, excluding
information which:

     (a) was already in the possession of or known by the receiving party prior to its receipt
from the disclosing party;

     (b) is or becomes part of the public domain by reason of acts not attributable to the
receiving party;

     (c) is or becomes available to receiving party from a source other than the disclosing
party which source, has rightfully obtained such information and has no obligation of
non-disclosure or confidentiality to the disclosing party with respect thereto;

     (d) has been independently developed by the receiving party without breach of this
Agreement or use of any Confidential Information of the other party; or

     (e) has been or must be publicly disclosed by reason of legal, accounting or regulatory
requirements beyond the reasonable control of the receiving party provided the receiving
party provides the disclosing party notice of the intended disclosure in order for the
disclosing party to take such action it deems appropriate to protect the confidentiality of
the information to be disclosed.

     “Exclusive
Field” means therapeutic catheters, therapeutic guidewires or other therapeutic
intravascular devices that incorporate an ultrasonic imaging transducer, and related equipment
pertaining to such therapeutic catheters, therapeutic guidewires or other therapeutic
intravascular devices that incorporate an ultrasonic imaging transducer, other than with respect
to such therapeutic catheters, therapeutic guidewires or other therapeutic intravascular devices
that fall within the Non-Exclusive Field. The Exclusive Field shall include, but is not limited to
therapeutic catheters, therapeutic guidewires or other therapeutic intravascular devices used or
marketed to image or diagnose and treat: (i) aneurismal disease; (ii) valvular disease; or (iii)
diseases of the myocardium excluding atherosclerosis. The Exclusive Field does not include kits
where the diagnostic IVUS device is merely packaged with the therapeutic device.

     “Fields” means the Non-Exclusive Field and the Exclusive Field.

     “Invention” means any new and useful invention, discovery, know-how, trade secret,
data, information, technology, process or concept, whether or not patented or patentable related
to the IVUS Assets, conceived, reduced to practice or otherwise made, developed or demonstrated to
have utility by either party during the term of this Agreement.

     “IVUS
Assets” means any and all assets of any type associated with the intravascular
ultrasound business of JOMED, Inc. and its Affiliates, which, pursuant to the APA, are now owned
by, licensed to, possessed by, under the control of, or otherwise acquired by Volcano, and

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improvements thereon. For the avoidance of doubt, “IVUS Assets” does not include the Philips
Technology.

     “Know-How” means all know-how, trade secrets, expertise, discoveries and technical
information included within the IVUS Assets as of the Effective Date, including but not limited to
information embodied in drawings, designs, copyrights, copyright registrations and applications,
trademarks, service marks and registrations thereof and applications therefor, material
specifications, processing instructions, formulas, equipment specifications, product
specifications, confidential data, computer software, electronic files, research notebooks,
invention disclosures, research and development reports and the like related thereto, and all
amendments, modifications, upgrades and improvements to any of the foregoing.

     “Liens” means liens, mortgages, charges, security interests, claims, voting trusts, pledges,
encumbrances, options, assessments, restrictions, licenses, sublicenses, or third party or spousal
interests of any nature.

     “Medtronic” means AVE Galway Limited and its Affiliates.

     “Medtronic Product” shall have the meaning assigned in the Supply Agreement.

     “Non-Exclusive Field” means therapeutic catheters, therapeutic guidewires or other
therapeutic intravascular devices that incorporate an ultrasonic imaging transducer, and related
equipment pertaining to such therapeutic catheters, therapeutic guidewires or other therapeutic
intravascular devices that incorporate an ultrasonic imaging transducer, used or marketed to image
or diagnose and treat atherosclerosis (including vulnerable plaque). The Non-Exclusive Field shall
include, but is not limited to (i) devices incorporating IVUS Assets and stents on one catheter
used or marketed to diagnose and treat atherosclerosis (including vulnerable plaque), and (ii)
devices combining therapeutic and/or diagnostic IVUS capabilities used or marketed for imaging and
crossing chronic total occlusion. The Non-Exclusive Field does not include kits where the
diagnostic IVUS device is merely packaged with the therapeutic device.

     “Patents” means (a) all patents and patents applications included within the IVUS Assets,
including the patents and patent applications set forth on Exhibit B, together with any patents
that may issue based thereon; (b) all continuation, divisional, re-issue, re-examination and
substitution applications that may be filed by or for the benefit of Volcano based on the
foregoing referenced patents or patent application, together with any patents that may issue based
thereon; and (c) all foreign applications that may be filed by or for the benefit of Volcano based
on the foregoing referenced patents and patent applications, together with all patents which may
issue based thereon.

     “Philips Technology” means those U.S. and foreign patents and patent applications,
know-how, trade secrets and other proprietary technology, which relate to the IVUS Assets and are
licensed to, or acquired by, Volcano pursuant to that Asset Transfer Agreement dated July 3, 2003
by and between Pacific Rim Medical Ventures Corp., a wholly-owned subsidiary of Volcano, and
Koninklijke Philips Electronics N.V. (“Philips ATA”).

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     “Product” shall have the meaning assigned in the Supply Agreement.

     “Volcano” means Volcano Therapeutics, Inc. and its Affiliates.

     “Volcano Technology” means, collectively, the Patents, Know-How and Inventions.

     1.2
Definitional Provisions.

     (a) The words “hereof,” “herein,” and “hereunder” and words of similar import, when
used in this Agreement, shall refer to this Agreement as a whole and not to any particular
provisions of this Agreement.

     (b) Terms defined in the singular shall have a comparable meaning when used in the
plural, and vice-versa.

     (c) References to an “Exhibit” or to a “Schedule” are, unless otherwise specified, to
one of the Exhibits or Schedules attached to or referenced in this Agreement, and references
to an “Article” or a “Section” are, unless otherwise specified, to one of the Articles or
Sections of this Agreement.

     (d) The term “person” includes any individual, partnership, joint venture, corporation,
trust, unincorporated organization or government or any department or agency thereof.

ARTICLE 2

LICENSE TO MEDTRONIC

     2.1
License of Volcano Technology. Subject to the terms and conditions of this
Agreement and in consideration and subject to Volcano’s receipt of the License Fee, Volcano hereby
grants to Medtronic:

     (a) a fully paid, royalty-free, perpetual, irrevocable, worldwide, sublicensable, sole
and exclusive license to the Volcano Technology to make, have made, use, import, distribute,
sell, offer to sell and have sold products in the Exclusive Field, to practice methods
covered by the Volcano Technology in the Exclusive Field, and otherwise to commercialize and
exploit the Volcano Technology in the Exclusive Field.

     (b) a fully paid, royalty-free, perpetual, irrevocable, worldwide, sublicensable
non-exclusive license to the Volcano Technology to make, have made, use, import, distribute,
sell, offer to sell and have sold products in the Non-Exclusive Field, to practice methods
covered by the Volcano Technology in the Non-Exclusive Field, and otherwise to commercialize
and exploit the Volcano Technology in the Non-Exclusive Field.

     2.2
License of Philips Technology.

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     (a) At such time as, and to the extent that, (i) Volcano develops any IVUS Assets or
iterations thereof which utilize, or are covered by, the Philips Technology; or (ii) any Volcano
product (including, without limitation, products acquired pursuant to the APA) utilizes, or is
covered by, any Philips Technology and is covered by one or more Patents, Volcano hereby grants to
Medtronic an exclusive, royalty-free, worldwide license (or sublicense as the case may be) to
Volcano’s rights in the Philips Technology to make, have made, use, import, distribute, sell, offer
to sell and have sold products in the Exclusive Field, to practice methods covered by the Philips
Technology in the Exclusive Field, and otherwise to commercialize and exploit the Philips
Technology in the Exclusive Field.

     (b) To the extent that, (i) Volcano develops any IVUS Assets or iterations thereof which
utilize, or are covered by, the Philips Technology; or (ii) any Volcano product (including, without
limitation, products acquired pursuant to the APA) utilizes, or is covered by, any Philips
Technology and is covered by one or more Patents, Volcano agrees that it will use commercially
reasonable efforts to grant Medtronic, to the extent that Volcano is not prohibited under the
Philips ATA and related agreements from doing so, a non-exclusive, royalty-free, worldwide license
(or sublicense as the case may be) to make, have made, use, import, distribute, sell, offer to sell
and have sold products in the Non-Exclusive Field, to practice methods covered by the Philips
Technology in the Non-Exclusive Field, and otherwise to commercialize and exploit the Philips
Technology in the Non-Exclusive Field. Furthermore, if Volcano is prohibited under the Philips ATA
and related agreements from granting Medtronic such license, then, to the extent that Volcano is
not prohibited under the Philips ATA and related agreements from doing so, Volcano will supply to
Medtronic any product in the Non-Exclusive Field covered by the Philips Technology under terms and
conditions substantially similar to the Supply Agreement for the term of any patent within the
Philips Technology.

     (c) To the extent that the license grant set forth in Section 2.2(a) has not become effective
and no license has been granted with respect to Section 2.2(b) prior to Volcano’s consummation of a
transaction with a third party whereby Volcano’s rights in and to all or a portion of the Philips
Technology is assigned, sold or otherwise transferred, or exclusively licensed, to such third
party, without any right or interest in such portion of the Philips Technology remaining
with Volcano (a “Philips Transaction”), the rights and obligations of Medtronic and Volcano
with respect to such portion of the Philips Technology under Sections 2.2(a) or 2.2(b) shall
terminate on the date that such Philips Transaction is consummated. In the event Volcano
reacquires through license or otherwise obtains rights to any such Philips Technology, Medtronic’s
and Volcano’s rights and obligations under Sections 2.2(a) and 2.2(b) shall be revived.

     (d) Volcano agrees that to the extent the license grant set forth in Section 2.2(a) becomes
effective or a license is granted with respect to Section 2.2(b), such effectiveness and grants
shall not terminate upon a Philips Transaction, and any Philips Transaction shall be, and the third
party in any Philips Transaction shall acquire the Philips Technology, subject to such license
rights of Medtronic.

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     2.3
Restriction. The licenses granted under Sections 2.1 above shall be subject to the
applicable existing terms and conditions, if any, of the current agreement between JOMED, Inc. and
TransVascular, Inc. to the extent such agreement is part of the assets acquired by Volcano in the
JOMED Acquisition. Volcano agrees that, subject to receipt of the License Fee by Medtronic, Volcano
shall not extend the term of such agreement.

ARTICLE 3

TECHNOLOGY TRANSFER & ASSISTANCE

     3.1
Hiring of JOMED Engineers by Medtronic.

     (a) Subject to Section 3.2(b), on and after the Effective Date, Volcano agrees to
provide Medtronic with access to interview the JOMED Engineers and seek from said JOMED
Engineers relevant hiring information for the purposes of offering employment or a
consultancy arrangement to not more than two (2) of the JOMED Engineers; provided, however,
that each JOMED Engineer so chosen by Medtronic to be contacted by Medtronic for the above
purpose shall be reasonably acceptable to Volcano; provided, further, that should Volcano
reasonably determine that such a JOMED Engineer chosen by Medtronic is not acceptable,
including the determination that such JOMED Engineer is indispensable to the Product or
other Volcano products, Volcano will allow Medtronic to contact and approach an alternative
JOMED Engineer that is qualified for the Purpose. Without limiting the generality of the
foregoing, Volcano will, but only to the extent permitted under employment laws and
regulations applicable to Volcano and the JOMED Engineers, from time to time and upon
Medtronic’s reasonable request provide Medtronic with information about the skills sets and
expertise of, and the nature of work done by, the JOMED Engineers. Each JOMED Engineer
approached by Medtronic with an offer of employment or consultancy arrangement shall have
sole discretion in determining his or her acceptance or decline of such offer. The JOMED
Engineers so hired or retained by Medtronic hereunder are referred to as the “Medtronic
Engineers.” In the event a JOMED Engineer (or any other employee of Volcano with similar
skills as the JOMED Engineers) elects on his or her own to approach Medtronic for employment
or a consultancy arrangement, such Volcano employee shall count as one of the two Medtronic
Engineers if Medtronic enters into an employment or consultancy arrangement with said
Volcano employee.

     (b) Prior to Medtronic contacting or interviewing any of the JOMED Engineers for the
purpose of offering employment or a consultancy arrangement, Medtronic shall provide Volcano
20 business days prior written notice before the intended contact date of such JOMED
Engineers, which notice shall specify the names of the JOMED Engineers Medtronic intends to
contact. Volcano shall have 7 business days following receipt of such notice to notify
Medtronic if any or all of the JOMED Engineers are not acceptable to Volcano for hire or
retention by Medtronic, which notification shall provide Medtronic with one or more
alternative JOMED Engineers, as applicable. Except as to alternative JOMED Engineers
designated by Volcano, the protocol set forth in this Section 3.1(b) shall apply to each
JOMED Engineer Medtronic intends to contact or interview for the purpose of offering
employment or consultancy.

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     (c) Except as set forth in this Section 3.1, Medtronic agrees that it shall not solicit
employment or consultancy arrangements to any employees or consultants of Volcano. Volcano
similarly agrees that it shall not solicit employment or consultancy arrangements to any employees
or consultants of Medtronic who works or worked on the projects relating to the IVUS Assets. The
obligations on the parties under this Section 3.1(c) shall terminate upon the earlier of: (i) five
(5) years from the Effective Date, or (ii) one (1) year after a termination of rights and
obligations in accordance with Sections 3.4(a) or 3.4(b).

     (d) The Medtronic Engineers will be employees or independent consultants, as applicable, of
Medtronic, and Medtronic will be responsible for the costs associated with soliciting, hiring and
paying the Medtronic Engineers. Medtronic may hire or retain the Medtronic Engineers on terms
(including pay and benefits) satisfactory to Medtronic and the Medtronic Engineers in each of their
sole discretion.

     3.2
Access to Volcano Facilities and Personnel; Technology Transfer.

     (a) From the Effective Date until the termination of the rights and obligations in this
Section 3.2(a) pursuant to Section 3.4 hereof, Volcano will permit the Medtronic Engineers to work
on site at Volcano’s facilities with Volcano’s IVUS research and development personnel at no cost
to Medtronic for any facility space used by such Medtronic Engineers for the sole purpose of
developing products in the Fields (the “Purpose”). Whether or not the Medtronic Engineers work on
site at Volcano’s facilities, the Medtronic Engineers will, at no cost to Medtronic, have
reasonable access to Volcano personnel and facilities, as appropriate, so that Medtronic may pursue
the development of products in the Fields and ensure reasonable compatibility as provided for
pursuant to the Supply Agreement of Medtronic Products with Products.

     (b) From the Effective Date and after the expiration or termination of the rights and
obligations in Section 3.2(a), Volcano shall, upon Medtronic’s reasonable request from time to
time, provide Medtronic, such cooperation, as is appropriate to enable Medtronic to utilize the
licenses granted to Medtronic under this Agreement. Such cooperation shall include (i) providing
Medtronic with Know-How reasonably deemed necessary by Medtronic to develop or commercialize
products in the Fields; and (ii) providing Medtronic with assistance from Volcano’s engineering
staff to help address certain issues related to the efficient manufacture of products (such issues
may include, but not be limited to, identifying and helping to resolve material issues, identifying
and recommending alternatives to components that may have the potential of becoming obsolete or
difficult to obtain, and assisting with the resolution of yield issues). In addition, Volcano
will make available personnel as reasonably requested by Medtronic, to provide such individual
training to Medtronic technical and manufacturing personnel as is necessary to enable Medtronic to
utilize the licenses granted to Medtronic under this Agreement, at such reasonable times and places
as Medtronic may request from time to time to develop and commercialize products in the Fields.
Volcano agrees to take reasonable steps to ensure that all IVUS consoles Incorporating IVUS Assets
and/or using

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or used with Product produced and manufactured by or on behalf of Volcano will be compatible
with and interface with the products developed by Medtronic hereunder, and the parties will
take all reasonable and appropriate steps to ensure such compatibility and interface
concurrently with Volcano’s commercial introduction to market of any new generation of IVUS
consoles incorporating IVUS Assets and/or using or used with Product or upgrades (including
software and hardware upgrades) thereto. Such steps should include, if applicable and to the
extent appropriate, the provision by Volcano to Medtronic of all necessary technical
specifications, regulatory information and the like for the purpose of ensuring such
compatibility and interface concurrently with the commercial introduction of any new IVUS
consoles incorporating IVUS Assets and/or using or used with Product. Medtronic shall pay
Volcano a reasonable and customary per diem rate for each Volcano employee providing
services to Medtronic pursuant to this Section 3.2(b). Further, Medtronic shall reimburse
Volcano for travel, direct and indirect costs, and other out-of-pocket costs reasonably
incurred by Volcano in connection with such training upon submission by Volcano of
appropriate documentation thereof.

     (c) Volcano will not consummate any disposition (whether by sale, merger, license,
consolidation or otherwise) of all or any substantial portion of the IVUS Assets unless the
purchaser thereof agrees to be bound by Volcano’s obligations under Section 3.2(b).

     (d) Notwithstanding anything herein to the contrary, the extent of access to Volcano’s
facilities by the Medtronic Engineers or any other employees, agents or consultants of
Medtronic, including access to specific areas of the facilities, access to Volcano
personnel, and access to Volcano’s computer systems and network, shall all be determined and
limited by Volcano, in Volcano’s reasonable discretion.

     3.3
Collaboration (formerly quarterly meetings). Volcano will participate in meetings
with Medtronic personnel, at places and times to be reasonably agreed by the parties, on at least a
quarterly basis to review and update the progress of any development of Products and related IVUS
technology and potential applications of such developed technology in the Field.

     3.4
Termination.

     (a) Unless otherwise terminated pursuant to Section 3.4(b) below, the rights and
obligations contained in Sections 3.1 and 3.2(a) shall terminate upon the later of (i) three
(3) years from the date hereof; or (ii) the occurrence of a “Liquidity Event”. A “Liquidity
Event” means: (A) Volcano sells all or substantially all of its assets, whether by merger,
combination, sale of assets, sale of shares, licensing or other similar transaction; or (B)
Volcano consummates an initial public offering of shares of its common stock.

     (b) Notwithstanding the termination provisions of Section 3.4(a) above, the rights and
obligations contained in Section 3.1 and Section 3.2(a) shall terminate immediately if (i)
Medtronic sells all or substantially all of its assets, whether by merger, combination, sale
of assets, sale of shares, licensing or other similar transaction to any

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party listed on Exhibit C hereto; or (ii) either Medtronic or Volcano (A) becomes
insolvent; (B) commences any action or proceeding under any bankruptcy or insolvency law
for reorganization, arrangement, composition or similar relief; (C) has commenced against
it any action or proceeding under any bankruptcy or insolvency law that remains
undismissed or unstayed for a period of 60 days; or (D) makes an assignment for the
benefit of creditors, goes into liquidation or receivership or otherwise loses legal
control of its business.

ARTICLE 4

LICENSE FEE

     4.1
License Fee. Upon execution of this Agreement, Medtronic shall pay to Volcano a
fee in the amount of Two Million Five Hundred Thousand Dollars
($2,500,000) (“License Fee”). No
further payment of any type shall be due from Medtronic with respect to the licenses granted under
this Agreement.

ARTICLE 5

VOLCANO’S OBLIGATIONS

     5.1
Medtronic Exclusivity.

     (a) Volcano will not, without the prior written consent of Medtronic, promote, market,
supply, sell, transfer or otherwise dispose of any products or components that are covered
by any Patent to any third party if Volcano should have known after making reasonable
inquiry or has actual knowledge, that such third party intends or is likely to use, promote,
market, supply, sell, transfer or otherwise dispose of any such products or components in
the Exclusive Field. Prior to any sale, supply, transfer or other disposition to any third
party of any products or components covered by any Patent, Volcano shall obtain the
agreement of such third party that it will not use, promote, market, supply, sell, transfer
or otherwise dispose of any such products or components in the Exclusive Field or resell
such products or components for use in the Exclusive Field.

     (b) Notwithstanding anything to the contrary in Section 5.1(a), Section 5.1 (a) shall
not apply to the existing terms and conditions of that certain Supply Agreement, dated as of
June 30, 2003, by and between AVI Corp., a Delaware corporation, and JOMED, Inc. or the
existing terms and conditions of that certain Supply Agreement, dated as of January 31,
2000, as amended, by and between TransVascular, Inc., a California corporation, and
EndoSonics Corporation, a Delaware corporation (predecessor to JOMED, Inc.), which
agreements will be assumed by Supplier in the JOMED Acquisition.

     5.2
Maintain Agreements in Force. Volcano shall comply with all of the provisions of,
and shall maintain in full force and effect, all agreements with third parties which relates to the
Volcano Technology in the Fields. Volcano shall promptly notify Medtronic if any such third party
licensor alleges any breach by Volcano of any such license agreement directly related to the
Volcano Technology in the Fields. Medtronic shall be entitled, but not obligated, to cure any

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alleged breach by Volcano of such license agreement related to the Volcano Technology in the
Fields. Volcano agrees not to modify, waive or amend any provision of the Philips ATA without the
prior written consent of Medtronic, which consent shall not be unreasonably withheld or delayed,
if such modification, waiver or amendment would adversely impact Medtronic’s rights under this
Agreement.

ARTICLE 6

INTELLECTUAL PROPERTY

     6.1
Ownership of Inventions.

     (a) Each of Volcano and Medtronic shall solely own all right, title and interest in and
to any Inventions it solely conceives, reduces to practice or otherwise makes, develops or
lawfully acquires (the “Sole Inventions”) and Volcano and Medtronic shall jointly own all
right, title and interest in and to any Inventions that they jointly conceive, reduce to
practice or otherwise make, develop or lawfully acquire after the Effective Date (the “Joint
Inventions”). For purposes of this Section, an Invention which is the subject of a patent
application shall be deemed to have been developed jointly by employees or consultants of
Medtronic and Volcano, and thus be a Joint Invention, if at least one employee or consultant
of each of Medtronic and Volcano is required to be named as an inventor in such application
in order for such patent to be valid.

     (b) For any patentable Invention of Medtronic directly related to the Products
developed pursuant to the licenses granted hereunder which is the subject of a patent
application for which a Medtronic Engineer or a Medtronic employee involved in developing
products pursuant to the licenses granted hereunder is required to be named as an inventor,
Medtronic hereby grants to Volcano a fully paid, royalty-free, perpetual, irrevocable,
sub-licensable, transferable, worldwide, non-exclusive license to such Invention to make,
have made, use, import, distribute, sell, offer to sell and have sold products in any field
outside of the Exclusive Field, to practice methods covered by the Invention in any field
outside of the Exclusive Field, and otherwise to commercialize and exploit the Invention in
any field outside of the Exclusive Field.

     6.2
Joint Inventions.

     (a) Volcano will not, without the prior written consent of Medtronic, except as
contemplated in the Supply Agreement, (i) license or sublicense any Joint Invention to any
third party, other than an Affiliate, for the purpose of making, having made, using,
importing, distributing, selling, offering to sell or having Products sold for use in the
Exclusive Field, (ii) promote, market, supply, sell, transfer or otherwise dispose of any
Products for use in the Exclusive Field to any third party if, in regards to any of the
above (i) or (ii), Volcano should have known after making reasonable inquiry or has actual
knowledge, that such third party intends or is likely to promote or market any such Joint
Inventions in the Exclusive Field. Prior to any sale, supply, transfer or other disposition
to any third party of any Joint Invention, Volcano shall obtain the agreement of such third
party that it will not promote or market any such Joint Invention in the Exclusive Field.

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     (b) Notwithstanding anything to the contrary in Section 6.2(a), Section 6.2(a) shall not
apply to the existing terms of that certain Supply Agreement, dated as of June 30, 2003, by and
between AVI Corp., a Delaware corporation, and JOMED, Inc. (which provides for the supply of
phased-array intravascular ultrasonic component products for AVI Corp.’s Josonics systems) or to
the existing terms of that certain Supply Agreement, dated as of January 31, 2000, as amended, by
and between TransVascular, Inc., a California corporation, and EndoSonics Corporation, a Delaware
corporation (predecessor to JOMED, Inc.), which agreements will be assumed by Supplier in the
JOMED Acquisition.

     6.3
Protection of Technology.

     (a) During the term of this Agreement, Volcano shall promptly inform Medtronic of any
Invention, Joint Invention, improvement, amendment, upgrading or modification relating to the
Technology which may be applicable or useful in the Fields acquired by Volcano or to which Volcano
has rights.

     (b) Medtronic shall have the right, in Medtronic’s sole discretion, to control the filing,
prosecution and maintenance of any Patent to the extent such Patent relate solely to the Exclusive
Field. Medtronic will bear the expense of filing, prosecuting and maintaining any such U.S. and
foreign patents and applications within the Patents. Medtronic shall, either directly or through
its outside counsel, provide Volcano with copies of all filings and material correspondence
pertaining to such patent prosecution activities, in a timely manner, so as to give Volcano an
opportunity to comment thereon which comment Medtronic agrees to consider in good faith. Each party
shall execute and deliver such forms of assignment, power of attorney and other documents which are
necessary to give effect to the provisions hereof. If Medtronic determines not to exercise its
right under this Section 6.3(b) to control the filing, prosecution and maintenance of any Patent,
Volcano shall have the right but not the duty to file, prosecute and maintain of any such Patent.

     6.4
Prosecution of Infringement of Technology.

     (a) Each of Medtronic and Volcano shall promptly notify the other if it knows or has reason to
believe that any of the rights to the Volcano Technology in the Fields are being infringed or
misappropriated by a third party or that such infringement or misappropriation is threatened. The
parties shall consult with each other as promptly as reasonably practicable to review actions to be
taken in connection with such alleged infringement or misappropriation. Medtronic shall have the
right to institute and control the prosecution of any such alleged infringement or misappropriation
for its own account for any such alleged infringement or misappropriation of Volcano Technology to
the extent they relate solely to the Exclusive Field.

     (b) In the event Medtronic elects to prosecute such alleged infringement or misappropriation
for its own account Medtronic shall be solely responsible for payment of all costs and expenses it
incurs in the prosecution and/or a negotiation of a settlement.

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Medtronic shall retain any proceeds from such prosecution. Medtronic shall have the right
to act in the name of, or on behalf of Volcano, and join Volcano as a party plaintiff to
any such proceeding if Medtronic believes it is necessary or advisable to successfully
prosecute such infringement or misappropriation. Volcano shall cooperate in connection with
the initiation and prosecution by Medtronic of such suit or action.

     (c) If Medtronic determines not to exercise its right under this Section 6.4 to
institute and control the prosecution of any such alleged infringement or misappropriation
of Volcano Technology relating solely to the Exclusive Field, Volcano shall have the right
but not the duty to prosecute such infringement or misappropriation. Medtronic shall
cooperate in connection with the initiation and prosecution by Volcano of such suit or
action.

     6.5
Sole and Joint Inventions. Except as set forth in Sections 6.3 and 6.4:

     (a) Each of Volcano and Medtronic shall control and bear all expenses associated with
the prosecution, maintenance and enforcement of patents and patent applications covering
its Sole Inventions (provided that such patents and patent applications do not also cover
Joint Inventions).

     (b) Each of Volcano and Medtronic shall decide in writing, on a case-by-case basis,
each of Volcano’s and Medtronic’s rights and obligations to (i) control or participate in
prosecution, maintenance and enforcement of each patent or patent application covering a
Joint Invention, (ii) bear expenses associated with such activities, and (iii) receive a
share of patent enforcement awards. In the absence of any written agreement to the
contrary, (1) Volcano and Medtronic shall have an equal, undivided interest in such Joint
Inventions, (2) Volcano and Medtronic shall jointly control patent prosecution, maintenance
and enforcement, and (3) Volcano and Medtronic shall share equally both expenses and
awards from patent prosecution, maintenance and enforcement.

     6.6
Protect Information. Each party agrees to maintain the confidentiality of all
non-public information regarding the Volcano Technology, including but not limited to the status
of any patent applications included in the Patents. Each party agrees not to disclose or use
(except as permitted or required for performance by the party receiving such Confidential
Information of its rights or duties hereunder) any Confidential Information of the other party.
Each party further agrees to take appropriate measures to prevent any such prohibited disclosure by
its present and future employees, officers, agents, subsidiaries, or consultants.

ARTICLE 7

REPRESENTATIONS AND WARRANTIES

     7.1
Representations of Volcano. Volcano represents, warrants and covenants to
Medtronic as of the Effective Date that:

12

 

     (a) Volcano is a corporation duly organized, validly existing, and in good standing under the
laws of the State of Delaware and has full corporate power to conduct the business in which it is
presently engaged and to enter into and perform its obligations under this Agreement.

     (b) Volcano has taken all necessary corporate action under the laws of the state of its
incorporation and its certificate of incorporation and by-laws to authorize the execution and
consummation of this Agreement and, when executed and delivered by Volcano, this Agreement shall
constitute the valid and legally binding agreement of Volcano enforceable against Volcano in
accordance with the terms hereof, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to or affecting
creditors’ rights and to general equity principles.

     (c) Neither the execution and delivery of this Agreement nor the consummation
of the transactions contemplated herein will violate any provision of the certificate of
incorporation or bylaws of Volcano or any law, rule, regulation, writ, judgment, injunction,
decree, determination, award or other order of any court or governmental agency or instrumentality,
domestic or foreign, or conflict with or result in any breach of any of the terms of or constitute
a default under or result in termination of or the creation or imposition of any Lien pursuant to
the terms of any contract or agreement to which Volcano is a party or by which Volcano or any of
its assets is bound.

     (d) To Volcano’s knowledge after due inquiry, Volcano owns, or has valid and subsisting
license rights (with the right to sublicense) to, all of the Volcano Technology within the Fields.
To Volcano’s knowledge, no current employee, officer, agent or consultant of Volcano has any
rights in or to any of the Volcano Technology within the Fields. To Volcano’s knowledge and
without independent investigation, no person or entity nor such person’s or entity’s business or
products has infringed, misused, misappropriated or conflicted with the Volcano Technology within
the Fields or currently is infringing, misusing, misappropriating or conflicting with such Volcano
Technology within the Fields.

     (e) To Volcano’s knowledge and without independent investigation, there are no actions, suits,
claims, disputes or proceedings or governmental investigations pending or threatened against
Volcano or any of its Affiliates with respect to the Volcano Technology, either at law or in
equity, before any court or administrative agency or before any governmental department,
commission, board, bureau, agency or instrumentality, or before any arbitration board or
panel whether located in the United States or a foreign country. To Volcano’s knowledge, Volcano
has not failed to comply with any law, rule, regulation, writ, judgment, injunction, decree,
determination, award or other order of any court or other governmental department, commission,
board, bureau, agency or instrumentality, or before any arbitration board or panel whether located
in the United States or a foreign country, which failure in any case would in any material respect
impair any rights of Medtronic under this Agreement.

13

 

     (f) All Patents identified in Exhibit B have the status indicated therein and all
applications are still pending in good standing and have not been withdrawn or abandoned.
The Patents identified in Exhibit B constitute all of the current patents and patent
applications of Volcano having applicability to the Volcano Technology within the Fields.
Volcano has made all statutorily required filings, if any, to record its interest in the
Patents identified in Exhibit B.

     (g) To Volcano’s knowledge after due inquiry, the IVUS Assets represent substantially
all of the assets associated with the intravascular ultrasound business of JOMED, Inc. and
its affiliates.

     (h) Volcano has full right and authority to grant the licenses herein granted. Except
as expressly made in this Section 7.1, Volcano makes no warranties or representations
whatsoever regarding the validity or the scope of the Volcano Technology, or the specific
utility or application of any of the Volcano Technology.

     (i) Volcano has not granted any license or other rights in the Phillips Technology to
any other party. Notwithstanding anything to the contrary in this Section
7.1 and except as set forth in the previous sentence, Volcano makes no representations or
warranties whatsoever regarding the (A) Philips Technology or (B) any rights or obligations
of Volcano to AVI Corp. or TransVascular, Inc. or their Affiliates, pursuant to any
existing terms of the agreements with AVI Corp. or TransVascular, Inc. or their Affiliates,
assumed by Volcano in the Jomed Acquisition.

     7.2
Representations of Medtronic. Medtronic represents, warrants and covenants to
Volcano as of the Effective Date that:

     (a) Medtronic is a corporation duly organized, validly existing, and in good standing
under the laws of the Republic of Ireland and has full corporate power to conduct the
business in which it is presently engaged and to enter into and perform its obligations
under this Agreement.

     (b) Medtronic has taken all necessary corporate action under the laws of the state of
its incorporation and its articles of incorporation and bylaws to authorize the execution
and consummation of this Agreement and, when executed and delivered by Medtronic, this
Agreement shall constitute the valid and legally binding agreement of Medtronic enforceable
against Medtronic in accordance with the terms hereof, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors’ rights and to general equity principles.

     (c) Neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated herein will violate any provision of the
articles and bylaws of Medtronic or any law, rule, regulation, writ, judgment, injunction,
decree, determination, award or other order of any court or governmental agency or
instrumentality, domestic or foreign, or conflict with or result in any breach of any of the

14

 

terms of or constitute a default under or result in termination of or the creation or
imposition of any Lien pursuant to the terms of any contract or agreement to which
Medtronic is a party or by which Medtronic or any of its assets is bound.

ARTICLE 8

INDEMNIFICATION

     8.1
Indemnification by Volcano. Volcano shall indemnify, defend and hold harmless
Medtronic and each of its subsidiaries, officers, directors, shareholder, employees, agents and
affiliates (collectively, all such indemnitees are referred to in this Section as “Medtronic”)
against and in respect of any and all claims, demands, losses, obligations, liabilities, damages
(and including without limitation, compensatory and punitive damages), deficiencies, actions,
settlements, judgments, costs and expenses (including reasonable costs and legal fees incident
thereto or in seeking indemnification therefor) (collectively, “Claims”) which Medtronic may incur
or suffer or with which it may be faced arising out of or based upon the breach by Volcano of any
of its representations, warranties, covenants or agreements contained or incorporated in this
Agreement or any agreement, certificate or document executed and delivered to Medtronic by Volcano
in connection with the transactions hereunder.

     8.2
Indemnification by Medtronic. Medtronic shall indemnify, defend and hold harmless
Volcano and each of its subsidiaries, officers, directors, shareholders, employees, agents and
affiliates (collectively, all such indemnitees are referred to in this Section as “Volcano”)
against and in respect of any and all Claims which Volcano may incur or suffer or with which it may
be faced arising out of or based upon (i) the breach by Medtronic of any of its representations,
warranties, covenants or agreements contained or incorporated in this Agreement or any
agreement, certificate or document executed and delivered to Volcano by Medtronic in connection
with the transactions hereunder or (ii) Medtronic’s hiring or retention of the Medtronic Engineers
or the Medtronic Engineers’ activities and/or presence at Volcano’s facilities, including without
limitation, workers compensation Claims, employment related Claims, personal injury Claims and
Claims relating to the misappropriate of trade secrets, unless such Claims are caused by Volcano’s
acts, including, but not limited to, gross negligence or intentional misconduct.

     8.3
Third Party Claims. If a claim by a third party is made against any indemnified
party, and if the indemnified party intends to seek indemnity with respect thereto under this
Article 8, such indemnified party shall promptly notify the indemnifying party of such claim;
provided, however, that failure to give timely notice shall not affect the rights of the
indemnified party except to the extent that the failure to give timely notice adversely affects the
indemnifying party’s ability to defend such claim against a third party. The indemnifying party
shall be entitled to settle or assume the defense of such claim, including the employment of
counsel reasonably satisfactory to the indemnified party. If the indemnifying party elects to
settle or defend such claim, the indemnifying party shall notify the indemnified party within
thirty (30) days (but in no event less than twenty (20) days before any pleading, filing or
response on behalf of the indemnified party is due) of the indemnifying party’s intent to do so. If
the indemnifying party elects not to settle or defend such claim or fails to notify the indemnified
party of the election within thirty (30) days (or such shorter period provided above) after receipt
of the indemnified

15

 

party’s notice of a claim of indemnity hereunder, the indemnified party shall have the right to
contest, settle or compromise the claim without prejudice to any rights to indemnification
hereunder. Regardless of which party is controlling the settlement of defense of any claim, (a)
both the indemnified party and indemnifying party shall act in good faith, (b) the indemnifying
party shall not thereby permit to exist any Lien, encumbrance or other adverse charge upon any
asset of any indemnified party or of its subsidiaries, (c) the indemnifying party shall permit the
indemnified party to participate in such settlement or defense through counsel chosen by the
indemnified party, with all fees, costs and expenses of such counsel borne by the indemnified
party, (d) no entry of judgment or settlement of a claim may be agreed to without the written
consent of the indemnified party, and (e) the indemnifying party shall promptly reimburse the
indemnified party for the full amount of such claim and the related expenses as incurred by the
indemnified party pursuant to this Article 8. So long as the indemnifying party is reasonably
contesting any such third party claim in good faith and the foregoing clause (b) is being complied
with, the indemnified party shall not pay or settle any such claim. The controlling party shall
upon request deliver, or cause to be delivered, to the other party copies of all correspondence,
pleadings, motions, briefs, appeals or other written statements relating to, or submitted in
connection with, the settlement or defense of any such claim, and timely notices of any hearing or
other court proceeding relating to such claim.

ARTICLE 9

MISCELLANEOUS

     9.1
Successors and Assigns. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and the successors or permitted assigns of the parties hereto.
Medtronic may assign or otherwise transfer its rights and obligations under this Agreement. Volcano
may not assign or transfer in any manner (whether by merger, share exchange, combination or
consolidation of any type, operation of law, purchase or otherwise) any of its rights or
obligations under this Agreement except to an Affiliate of Volcano or any person who succeeds to
substantially all of the assets and business of Volcano relating to the IVUS Assets. Any
prohibited assignment or transfer shall be null and void.

     9.2
Complete Agreement. This Agreement and the agreements referred to herein, and the
Schedules and Exhibits hereto and thereto, constitute the entire agreement between the parties
hereto with respect to the subject matter hereof and supersede all prior agreements whether written
or oral relating hereto.

     9.3
Governing Law. The formation, legality, validity, enforceability
and interpretation of this Agreement shall be governed by the laws of the State of California,
without giving effect to the principles of conflict of laws; provided, however, that nothing in
California procedural law shall be deemed to alter or affect the applicability of the rules of the
Federal Arbitration Act as governing arbitration of disputes as provided in Section 9.14 and,
provided further, that no California laws or rules of arbitration shall be applicable. Subject to
Section 9.14, the parties hereto hereby submit to the exclusive jurisdiction of the United States
federal and state courts located in the county in which arbitration is conducted with respect to
any dispute arising under this Agreement, the agreements entered into in connection herewith or the
transactions contemplated hereby or thereby, and irrevocably consent to the exclusive

16

 

jurisdiction and venue of such courts and waive any objections they may have at any time to
such exclusive jurisdiction and venue.

     9.4
Waiver, Discharge, Amendment, Etc. The failure of any party hereto to enforce at
any time any of the provisions of this Agreement shall not, absent an express written waiver signed
by the party making such waiver specifying the provision being waived, be construed to be a waiver
of any such provision, nor in any way to affect the validity of this Agreement or any part thereof
or the right of the party thereafter to enforce each and every such provision. No waiver of any
breach of this Agreement shall be held to be a waiver of any other or subsequent breach. Any
amendment to this Agreement shall be in writing and signed by Volcano and Medtronic.

     9.5 Notices. All notices or other communications to a party required or permitted
hereunder shall be in writing and shall be delivered personally or by facsimile (receipt confirmed
electronically) to such party (or, in the case of an entity, to an executive officer of such party)
or shall be sent by a reputable express delivery service or by certified mail, postage prepaid with
return receipt requested, addressed as follows:

     if to Medtronic, to:

Medtronic, Inc.

710 Medtronic Parkway NE

Minneapolis, MN 55432-5604

     with separate copies thereof addressed to

	 	 	 	 	 
	 

	 	Attention:
	 	General Counsel
	 

	 	 	 	Mail Stop LC400
	 

	 	 	 	Telecopier No.: (763) 572-5459
	 
	 	 	 	 
	 

	 	and	 	 
	 
	 	 	 	 
	 

	 	Attention:
	 	Vice President and Chief Development Officer
	 

	 	 	 	Mail Stop LC390
	 

	 	 	 	Telecopier No.: (763) 505-2542
	 
	 	 	 	 
	 

	 	and	 	 
	 
	 	 	 	 
	 	 	Medtronic AVE
	 	 	3576 Unocal Place
	 	 	Santa Rosa, CA 95403
	 

	 	Attention:
	 	General Counsel
	 

	 	 	 	Telecopier No.: (707) 541-3190

     if to Volcano to:

      Volcano
Therapeutics, Inc.

17

 

2870 Kilgore Road

Rancho Cordova, California 95670

Telecopier No.: (916) 638-7976

Attn: Vincent J. Burgess, Vice President, Marketing and Business Development

Any party may change the above-specified recipient and/or mailing address by notice to all other
parties given in the manner herein prescribed. All notices shall be deemed given on the day when
actually delivered as provided above (if delivered personally or by facsimile) or on the day shown
on the return receipt (if delivered by mail or delivery service).

     9.6 Expenses. Volcano and Medtronic shall each pay their own expenses incident to this
Agreement and the preparation for, and consummation of, the transactions provided for herein.

     9.7 Titles and Headings; Construction. The titles and headings to the Articles and
Sections herein are inserted for the convenience of reference only and are not intended to be a
part of or to affect the meaning or interpretation of this Agreement. This Agreement shall be
construed without regard to any presumption or other rule requiring construction hereof against
the party causing this Agreement to be drafted.

     9.8 Severability. If any provision of this Agreement is held invalid,
illegal or unenforceable, such provision shall be enforced to the maximum extent permissible
and the remaining provisions shall nonetheless be enforceable according to their terms.

     9.9 Relationship. This Agreement does not make either party the employee, agent
or legal representative of the other for any purpose whatsoever. Neither party is granted any right
or authority to assume or to create any obligation or responsibility, express or implied, on behalf
of or in the name of the other party. In fulfilling its obligations pursuant to this Agreement,
each party shall be acting as an independent contractor.

     9.10 Benefit. Nothing in this Agreement, expressed or implied, is intended to confer
on any person other than the parties hereto or their respective successors or assigns, any rights,
remedies, obligations or liabilities under or by reason of this Agreement.

     9.11 Survival. The representations, warranties, covenants and agreements contained in
this Agreement shall survive termination of this Agreement and remain in full force and effect. No
independent investigation of Volcano by Medtronic, its counsel, or any of its agents or employees
shall in any way limit or restrict the scope of the representations and warranties made by Volcano
in this Agreement.

     9.12 Counterparts. This Agreement may be executed in any number of counterparts, each
of which shall be deemed as original and all of which together shall constitute one instrument.

     9.13 Execution of Further Documents. Each party agrees to execute and deliver
without further consideration any further applications, licenses, assignments or other documents,

18

 

and to perform such other lawful acts as the other party may reasonably request to fully
secure and/or evidence the rights or interests herein.

     9.14 Arbitration. Any dispute arising out of or relating to this Agreement, including
the formation, interpretation or alleged breach hereof, shall be settled in accordance with the
Exhibit D attached hereto. The results of such arbitration proceedings shall be binding upon the
parties hereto, and judgment may entered upon the arbitration award in any court having
jurisdiction thereof. Notwithstanding the foregoing, either party may seek interim injunctive
relief from any court of competent jurisdiction.

     9.15 Public Announcement. Neither party will publicly or privately disclose or divulge
any provisions of this Agreement or the transactions contemplated hereby without the other parties’
written consent, except as may be required by applicable law, rule, regulation, order or stock
exchange regulation, and except for communications to employees; provided that, prior to disclosure
of any provision of this Agreement that either party considers particularly sensitive or
confidential to any governmental agency or stock exchange, the parties shall cooperate to seek
confidential treatment or other applicable limitations on the public availability of such
information. In particular, prior to such disclosure, each party shall use its best efforts to
redact the royalty rates and payment terms specified herein and each party shall provide the other
the opportunity to redact other information and seek confidential treatment of any such disclosure.

     9.16 Medtronic Guaranty. Medtronic, Inc. hereby guaranties the performance by AVE
Galway Limited of AVE Galway Limited’s obligations under this License Agreement.

19

 

     IN WITNESS WHEREOF, each of the parties has caused this License Agreement to be executed in
the manner appropriate for each, and to be dated as of the date first above-written.

	 	 	 	 	 
	 	 	VOLCANO THERAPEUTICS, INC.
	 
	 	 	 	 
	 	 	/s/ Scott Huennekens
	 	 	 

	 

	 	By:
	 	Scott Huennekens
	 

	 	Its:
	 	President & CEO
	 
	 	 	 	 
	 	 	AVE GALWAY LIMITED
	 
	 	 	 	 
	 	 	/s/ Mark A.
Schlossberg
	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Its:	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 	 	MEDTRONIC, INC.
	 
	 	 	 	 
	 	 	/s/ Arthur D. Collins, Jr.
	 	 	 
	 

	 	By:
	 	Arthur D. Collins, Jr.
	 

	 	Its:
	 	Chairman of the Board and
Chief Executive Officer

20

 

EXHIBIT A

JOMED Engineers

21

 

EXHIBIT B

PATENTS

I.
Summary of JOMED, Inc. IVUS Patents

	 	 	 	 	 
	Country:	 	Appl/Patent Nr.:	 	Date:
	1) TrakBack Positioning Device
	Canada
	 	2383941	 	31-Aug-00
	 
	Europe
	 	00959903.6	 	31-Aug-00
	 
	 	 	 	 
	Japan
	 	2001/521384	 	31-Aug-00
	 
	 	 	 	 
	United States
	 	09/391071	 	4-Sep-99
	Granted as
	 	US6224586	 	l-May-01
	 
	 	 	 	 
	PCT
	 	US00/24340	 	31-Aug-00
	 
	 	 	 	 
	2) Brachytherapy Planning
(Co-Assigned to Cleveland Clinic Foundation)
	United States
	 	09/505388	 	16-Feb-00
	Granted as
	 	US6224586	 	l-May-01
	 
	 	 	 	 
	3) Forward-Looking IVUS
	Canada
	 	2395631	 	7-Feb-0l
	 
	 	 	 	 
	Europe
	 	01908904.4	 	6-Aug-02
	 
	 	 	 	 
	Japan
	 	2001/557697	 	7-Feb-0l
	 
	 	 	 	 
	United States
	 	09/501106	 	9-Feb-00
	Granted as
	 	US6457365	 	l-Oct-02
	 
	 	 	 	 
	United States
	 	10/174412	 	18-Jun-02
	 
	 	 	 	 
	United States
	 	10/243823	 	13-Sep-02
	 
	 	 	 	 
	PCT
	 	01/103894	 	7-Feb-0l
	 
	 	 	 	 
	4) OptiTrak
	 	 	 	 
	United States
	 	10/109191	 	28-Mar-02
	 
	 	 	 	 
	5) IVUS
	 	 	 	 
	Canada
	 	581371	 	26-Oct-88
	Granted as
	 	CA1306050	 	4-Aug-92
	 
	 	 	 	 
	Germany
	 	89901828.7	 	20-Oct-88
	Granted as
	 	P3854838.0	 	27-Dec-95
	 
	 	 	 	 
	Europe
	 	89901828.7	 	20-Oct-88

22

 

	 	 	 	 	 
	Country:	 	Appl/Patent Nr.:	 	Date:
	Granted as
	 	EP0339087	 	27-Dec-95
	Perfected in France, Great Britain, Italy, the Netherlands
	 
	 	 	 	 
	Japan
	 	501770/89	 	20-Oct-88
	Granted as
	 	JP2020066	 	19-Feb-96
	 
	 	 	 	 
	United States
	 	114351	 	27-Oct-87
	Granted as
	 	US4917097	 	17-Apr-90
	 
	 	 	 	 
	PCT
	 	US88/04036	 	20-Oct-88
	 
	 	 	 	 
	6) JOSONICS ESON
	Canada
	 	2076378	 	31-Dec-91
	Granted as
	 	CA2076378	 	27-Apr-99
	 
	 	 	 	 
	Europe
	 	92904268.7	 	31-Dec-91
	Granted as
	 	EP0519060	 	25-Sep-96
	Perfected in Germany, France, Great Britain, Italy
	 
	 	 	 	 
	Japan
	 	504415/92	 	31-Dec-91
	Granted as
	 	JP2552421	 	22-Aug-96
	 
	 	 	 	 
	United States
	 	638192	 	7-Jan-91
	Granted as
	 	US5167233	 	1 -Dec-92
	 
	 	 	 	 
	PCT
	 	US91/09821	 	31-Dec-91
	 
	 	 	 	 
	7) Ringdown ESON
	Canada
	 	2112391	 	19-Jun-92
	Granted as
	 	CA2112391	 	20-Mar-0l
	 
	 	 	 	 
	Europe
	 	92914893.0	 	19-Jun-92
	 
	 	 	 	 
	Japan
	 	501556/93	 	19-Jun-92
	Granted as
	 	JP3194582	 	l-Jun-01
	 
	 	 	 	 
	United States
	 	719804	 	24-Jun-91
	Granted as
	 	US5183048	 	2-Feb-93
	 
	 	 	 	 
	PCT
	 	US92/05156	 	19-Jun-92
	 
	 	 	 	 
	8) Multi-Sectioned IVUS
	Canada
	 	2133475	 	14-Jan-94
	Granted as
	 	CA2133475	 	14-Jul-98
	 
	 	 	 	 
	Canada
	 	2235947	 	14-Jan-94
	 
	 	 	 	 
	Europe
	 	94906070.1	 	14-Jan-94
	 
	 	 	 	 
	Europe
	 	96202546.6	 	14-Jan-94
	Granted as
	 	EP0750883	 	24-Apr-02
	Perfected in Switzerland, Germany, France, Great Britain, Italy, Lichtenstein, Netherlands
	 
	 	 	 	 
	Japan
	 	518040/94	 	14-Jan-94

23

 

	 	 	 	 	 
	Country:	 	Appl/Patent Nr.:	 	Date:
	United States
	 	012251	 	l-Feb-93
	Granted as
	 	US5368037	 	29-Nov-94
	 
	 	 	 	 
	United States
	 	516538	 	18-Aug-95
	Granted as
	 	US5603327	 	18-Feb-97
	 
	 	 	 	 
	PCT
	 	US94/00474	 	14-Jan-94
	 
	 	 	 	 
	9) Wrap Transducer ESON
	United States
	 	712166	 	ll-Sep-96
	Granted as
	 	US5779644	 	14-Jul-98
	 
	 	 	 	 
	United States
	 	935930	 	23-Sep-97
	Granted as
	 	US5938615	 	17-Aug-99
	 
	 	 	 	 
	United States
	 	09/324692	 	2-Jun-99
	Granted as
	 	US6123673	 	26-Sep-00
	 
	 	 	 	 
	United States
	 	09/658323	 	8-Sep-00
	Granted as
	 	US6283920	 	4-Sep-0l
	 
	 	 	 	 
	United States
	 	09/906302	 	16-Jul-0l
	 
	 	 	 	 
	10) ChromaFlo
	 	 	 	 
	Canada
	 	2163213	 	19-Apr-95
	Granted as
	 	CA2163213	 	25-May-99
	 
	 	 	 	 
	Europe
	 	95917583.7	 	19-Apr-95
	 
	 	 	 	 
	Japan
	 	528280/95	 	19-Apr-95
	Granted as
	 	JP3188470	 	ll-May-01
	 
	 	 	 	 
	United States
	 	234848	 	28-Apr-94
	Granted as
	 	US5453575	 	26-Sep-95
	 
	 	 	 	 
	PCT
	 	US95/04776	 	19-Apr-95
	 
	 	 	 	 
	11) Flexible Substrate
	Canada
	 	2211196	 	23-Dec-96
	 
	 	 	 	 
	Europe
	 	96945048.5	 	23-Dec-96
	 
	 	 	 	 
	United States
	 	578226	 	26-Dec-95
	 
	 	 	 	 
	United States
	 	712576	 	13-Sep-96
	 
	 	 	 	 
	PCT
	 	US96/20655	 	23-Dec-96
	 
	 	 	 	 
	12) Flexible Substrate2
	Canada
	 	2226194	 	31-Dec-97
	 
	 	 	 	 
	Europe
	 	98200020.0	 	7-Jan-98
	 
	 	 	 	 
	United States
	 	780437	 	8-Jan-97

24

 

	 	 	 	 	 
	Country:	 	Appl/Patent Nr.:	 	Date:
	Granted as
	 	US5857974	 	12-Jan-99
	 
	 	 	 	 
	United States
	 	974677	 	19-Nov-97
	Granted as
	 	US6049958	 	18-Apr-00
	 
	 	 	 	 
	United States
	 	09/550864	 	17-Apr-00
	 
	 	 	 	 
	13) ChromaFlo2
	 	 	 	 
	Canada
	 	2234191	 	7-Apr-98
	 
	 	 	 	 
	Europe
	 	98201041.5	 	2-Apr-98
	 
	 	 	 	 
	Japan
	 	95883/98	 	8-Apr-98
	 
	 	 	 	 
	United States
	 	827724	 	8-Apr-97
	Granted as
	 	US5921931	 	13-Jul-99
	 
	 	 	 	 
	14) JOSONICS ESON2
	 	 	 	 
	Canada
	 	2254474	 	24-Nov-98
	 
	 	 	 	 
	Europe
	 	98309885.6	 	2-Dec-98
	 
	 	 	 	 
	Japan
	 	348051/98	 	8-Dec-98
	 
	 	 	 	 
	United States
	 	987465	 	9-Dec-97
	Granted as
	 	US5876344	 	2-Mar-99
	 
	 	 	 	 
	United States
	 	09/234967	 	21-Jan-99
	Granted as
	 	US6080109	 	27-Jun-00
	 
	 	 	 	 
	15) Ringdown2 ESON
	Canada
	 	2308457	 	25-Aug-99
	Granted as
	 	CA2308457	 	22-Aug-00
	 
	 	 	 	 
	Europe
	 	99943907.8	 	5-May-00
	 
	 	 	 	 
	Japan
	 	00/569701	 	25-Aug-99
	 
	 	 	 	 
	United States
	 	09/153819	 	15-Sep-98
	Granted as
	 	US6036650	 	14-Mar-00
	 
	 	 	 	 
	PCT
	 	US99/19392	 	25-Aug-99
	 
	 	 	 	 
	16) Brachytherapy (Co-Assigned to Cleveland Clinic Foundation)
	Canada
	 	2276893	 	5-Jul-99
	 
	 	 	 	 
	Europe
	 	98302179.1	 	24-Mar-98
	 
	 	 	 	 
	Europe
	 	99202338.2	 	15-Jul-99
	 
	 	 	 	 
	Japan
	 	81973/98	 	27-Mar-98
	 
	 	 	 	 
	Japan
	 	203758/99	 	16-Jul-99

25

 

	 	 	 	 	 
	Country:	 	Appl/Patent Nr.:	 	Date:
	United States
	 	827489	 	28-Mar-97
	Granted as
	 	US6033357	 	7-Mar-00
	 
	 	 	 	 
	United States
	 	09/118308	 	16-Jul-98
	Granted as
	 	US6309339	 	30-Oct-01
	 
	 	 	 	 
	United States
	 	09/114594	 	13-Jul-98
	Granted as
	 	US6077213	 	20-Jun-00
	 
	 	 	 	 
	United States
	 	09/436666	 	10-Nov-99
	Granted as
	 	US6387035	 	14-May-02
	 
	 	 	 	 
	United States
	 	09/614662	 	12-Jul-00
	 
	 	 	 	 
	United States
	 	09/876481	 	6-Jun-0l
	 
	 	 	 	 
	17) Brachytherapy Wire (Co-Assigned to Cleveland Clinic Foundation)
	United States
	 	886602	 	l-Jul-97
	Granted as
	 	US6024690	 	15-Feb-00
	 
	 	 	 	 
	PCT
	 	US98/13074	 	24-Jun-98
	 
	 	 	 	 
	18) Palpography
	 	 	 	 
	Canada
	 	2246687	 	5-Oct-98
	 
	 	 	 	 
	Europe
	 	97203072.0	 	6-Oct-97
	 
	 	 	 	 
	Japan
	 	284546/98	 	6-Oct-98
	 
	 	 	 	 
	United States
	 	09/166016	 	5-Oct-98
	Granted as
	 	US6165128	 	26-Dec-00
	 
	 	 	 	 
	19) IVUS Flow
	 	 	 	 
	Canada
	 	2270534	 	2-Sep-97
	 
	 	 	 	 
	Europe
	 	97940463.9	 	2-Sep-97
	 
	 	 	 	 
	Japan
	 	521243/98	 	2-Sep-97
	 
	 	 	 	 
	Japan
	 	21000	 	6-May-99
	 
	 	 	 	 
	United States
	 	09/297538	 	3-May-99
	Granted as
	 	US6213950	 	10-Apr-0l
	 
	 	 	 	 
	United States
	 	09/748464	 	26-Dec-00
	 
	 	 	 	 
	PCT
	 	NL97/00504	 	2-Sep-97
	 
	 	 	 	 
	20) TrakBack ESON
	 	 	 	 
	Europe
	 	98905289.9	 	9-Jan-98
	 
	 	 	 	 
	United States
	 	09/331951	 	2-Nov-99
	Granted as
	 	US6290675	 	21-May-0l

26

 

	 	 	 	 	 
	Country:	 	Appl/Patent Nr.:	 	Date:
	PCT
	 	EP98/00151	 	9-Jan-98
	 
	 	 	 	 
	21) Swivel Tip (Co-Assigned to Cleveland Clinic Foundation)
	United States
	 	09/354992	 	16-Jul-99
	Granted as
	 	US6290693	 	18-Sep-0l
	 
	 	 	 	 
	United States
	 	09/955321	 	17-Sep-0l
	 
	 	 	 	 
	JOMED N.V. IVUS Patents
	 
	 	 	 	 
	Country:
	 	Appl/Patent Nr.:	 	Date:
	1) EagleEye
	 	 	 	 
	United States
	 	10/233870	 	29-Aug-02
	 
	 	 	 	 
	2) Hawk
	 	 	 	 
	United States
	 	10/233893	 	29-Aug-02
	 
	 	 	 	 
	3) EagleEye Microcable
	United States
	 	60/413267	 	23-Sep-02
	 
	 	 	 	 
	4) IVUS Measurement Indicia
	United States
	 	10/265515	 	4-Oct-02
	 
	 	 	 	 
	5) Palpographic Enhancements
	United States
	 	60/431575	 	6-Dec-02
	 
	 	 	 	 
	6) Vulnerable Plaque
	United States
	 	10/127052	 	19-Apr-02
	 
	 	 	 	 
	United States
	 	10/232429	 	28-Aug-02
	 
	 	 	 	 
	United States
	 	10/232428	 	28-Aug-02
	 
	 	 	 	 
	United States
	 	10/393665	 	21-Mar-03
	 
	 	 	 	 
	PCT
	 	US03/12113	 	18-Apr-03
	 
	 	 	 	 
	PCT
	 	US03/12114	 	18-Apr-03

27

 

EXHIBIT C

Prohibited Assignees

	1.	 	Boston Scientific Corporation 
	 
	2.	 	 Terumo
	 
	3.	 	Aloka Co., Ltd.
	 
	4.	 	Philips
	 
	5.	 	General Electric
	 
	6.	 	Toshiba
	 
	7.	 	Siemens
	 
	8.	 	Any of the above entities’ Affiliates or their ultrasound
business unit successors or assigns.

28

 

EXHIBIT D

Arbitration Procedures

1)
Negotiations. If any dispute arises between Volcano and Medtronic with respect to the
License Agreement (the “Agreement”), or any alleged breach thereof, any party may, by written
notice to the other party, have such dispute referred to their respective designees listed below or
their successors for attempted resolution by good faith negotiations within 30 days after such
notice is received. Such designees are as follows:

For Volcano — the Vice President, Marketing and Business Development of Volcano or his/her
designee

For Medtronic — the President of Medtronic AVE, Inc.

Any settlement reached by the parties under this Section 1 shall not be binding until reduced to
writing and signed by the above-specified designees of Medtronic and Volcano. When reduced to
writing, such settlement agreement shall supersede all other agreements, written or oral, to the
extent such agreements specifically pertain to the matters so settled. If the designees are unable
to resolve such dispute within such 30-day period, any party may invoke the provisions of Section 2
below.

     2)
Arbitration. All claims, disputes, controversies, and other matters in question
arising out of or relating to the Agreements, including claims for Indemnifiable Losses and
disputes regarding the making of the Agreements, including claims of fraud in the inducement, or to
the alleged breach hereof, shall be settled by negotiation between the parties as described in
Section 1 above or, if negotiation is unsuccessful, by binding arbitration in accordance with
procedures set forth in Section 3 and 4 below.

     3)
Notice. Notice of demand for binding arbitration shall be given in writing to the
other party and shall be delivered personally or by facsimile (receipt confirmed) to an executive
officer of such party or shall be sent by a reputable express delivery service or by certified
mail, postage prepaid with return receipt requested, addressed as provided in the Agreement.

     Any
party may change the above-specified recipient and/or mailing address by notice to the
other party given in the manner herein prescribed. All notices shall be deemed given on the day
when actually delivered as provided above (if delivered personally or by facsimile (upon
appropriate electronic confirmation of successful transmission)) or on the day shown on the return
receipt (if delivered by mail or delivery service). In no event may a notice of demand of any kind
be filed more than two years after the date of the claim, dispute, controversy, or other matter in
question was asserted by one party against another, and if such demand is not timely filed, the
claim, dispute, controversy, or other matter in question referenced in the demand shall be deemed
released, waived, barred, and unenforceable for all time, and barred
as if by statute of
limitations.

29

 

     4)
Binding Arbitration. Upon filing of a notice of demand for binding arbitration by
any party hereto, arbitration shall be commenced and conducted as follows:

     (a) Arbitrators. All claims, disputes, controversies, and
other matters (collectively “matters”) in question shall be referred to and decided and
settled by a standing panel of three independent arbitrators, one selected by each of
Volcano and Medtronic’s representative and the third by the two arbitrators so selected;
provided, if the amount in controversy (including reasonably anticipated future amounts or
payments under the Agreement affected by such arbitrated matter) is under $300,000, a
single arbitrator will be used. The third (or the single arbitrator, if applicable) shall
be a former judge of one of the U.S. District Courts or one of the U.S. Court of Appeals or
such other classes of persons as the parties may agree. Selection of arbitrators shall be
made within 30 days after the date of the first notice of demand given pursuant to Section
3 and within 30 days after any resignation, disability or other removal of such arbitrator.
Following appointment, each arbitrator shall remain a member of the standing panel,
subject to removal for just cause or resignation or disability; provided, however, an
arbitrator can be removed by the party who appointed the arbitrator, or in the case of the
third arbitrator, by either party for any reason at any time when no matter is in
arbitration.

     (b)
Cost of Arbitration. The cost of each arbitration proceeding,
including without limitation the arbitrators’ compensation and expenses, hearing room
charges, court reporter transcript charges etc., shall be borne by the party whom the
arbitrators determine has not prevailed in such proceeding, or borne equally by the parties
if the arbitrators determine that neither party has prevailed. The arbitrators shall also
award the party that prevails substantially in its pre-hearing position its reasonable
attorneys’ fees and costs incurred in connection with the arbitration. The arbitrators
are specifically instructed to award attorneys’ fees for instances of abuse of the
discovery process.

     (c)
Location of Proceedings. An arbitration proceeding shall be held in
San Francisco, California, unless the parties agree otherwise.

     (d)
Pre-hearing Discovery. The parties shall have the right to
conduct and enforce pre-hearing discovery in accordance with the then current Federal Rules
of Civil Procedure, subject to these limitations: Document discovery and other discovery
shall be under the control of and enforceable by the arbitrators. The arbitrators shall
permit and facilitate such other discovery as they shall determine is appropriate under the
circumstances, taking into account the needs of the parties and the desirability of making
discovery expeditious and cost effective. The arbitrators shall decide discovery disputes.
The arbitrators are empowered:

     (i) to issue subpoenas to compel pre-hearing document or deposition
discovery;

     (ii) to enforce the discovery rights and obligations of the parties; and

30

 

     (iii) to otherwise control the scheduling and conduct of the proceedings.

     Notwithstanding any contrary foregoing provisions, the arbitrators shall have the power and
authority to, and to the fullest extent practicable shall, abbreviate arbitration discovery in a
manner that is fair to all parties in order to expedite the arbitration proceeding and render a
final decision within six months after the pre-hearing conference.

     (e)
Pre-hearing Conference. Within 45 days after filing of notice of demand for
binding arbitration, the arbitrators shall hold a pre-hearing conference to establish schedules for
completion of discovery, for exchange of exhibit and witness lists, for arbitration briefs, for the
hearing, and to decide procedural matters and all other questions that may be presented.

     (f)
Hearing Procedures. The hearing shall be conducted to preserve its privacy
and to allow reasonable procedural due process. Rules of evidence need not be strictly followed,
and the hearing shall be streamlined as follows:

     (i) Documents shall be self-authenticating, subject to valid objection by the opposing
party;

     (ii) Expert reports, witness biographies, depositions, and affidavits may be utilized,
subject to the opponent’s right of a live cross-examination of the witness in person;

     (iii) Charts, graphs, and summaries shall be utilized to present voluminous data,
provided (i) that the underlying data was made available to the opposing party 30 days
prior to the hearing, and (ii) that the preparer of each chart, graph, or summary is
available for explanation and live cross-examination in person;

     (iv) The hearing should be held on consecutive business days without interruption to
the maximum extent practicable; and

     (v) The arbitrators shall establish all other procedural rules for the conduct of the
arbitration in accordance with the rules of arbitration of the Center for Public Resources.

     (g)
Governing Law. This arbitration provision shall be governed by, and all
rights and obligations specifically enforceable under and pursuant to, the rules of the Federal
Arbitration Act and the laws of the State of California shall be applied, without reference to the
choice of law principles thereof, in resolving matters submitted to such arbitration.

31

 

     (h)
Consolidation. No arbitration shall include, by consolidation, joinder, or in any
other manner, any additional person not a party to this Agreement (other than affiliates of any
such party, which affiliates may be included in the arbitration), except by written consent of the
parties hereto containing a specific reference to this Agreement.

     (i)
Award. The arbitrators shall be required to render their final decision within six
months after the pre-hearing conference. The arbitrators are empowered to render an award of
general compensatory damages and equitable relief (including, without limitation, injunctive
relief), but are not empowered to award punitive or presumptive damages. The award rendered by the
arbitrators (1) shall be final; (2) shall not constitute a basis for collateral estoppel as to any
issue; and (3) shall not be subject to vacation or modification, except in the event of fraud or
gross misconduct on the part of the arbitrators.

     (j)
Confidentiality. The parties hereto will maintain the substance of any proceedings
hereunder in confidence and make disclosures to others only to the extent necessary to properly
conduct the proceedings.

     (j)
Entry of Judgment. The rulings of the arbitrators and allocation of fees and
expenses shall be binding, non-reviewable, and non-appealable, and may be entered as a final
judgment in any court having jurisdiction hereunder.

32exv10w23

 

[NOTE:
CERTAIN PORTIONS OF THIS DOCUMENT HAVE BEEN MARKED TO INDICATE THAT
CONFIDENTIAL INFORMATION HAS BEEN OMITTED. CONFIDENTIALITY HAS BEEN
REQUESTED FOR THIS CONFIDENTIAL INFORMATION. THE CONFIDENTIAL
PORTIONS HAVE BEEN PROVIDED SEPARATELY TO THE SECURITIES AND EXCHANGE
COMMISSION]

Exhibit 10.23

FUKUDA
DENSHI CO. LTD. AND ENDOSONICS CORPORATION

JAPANESE DISTRIBUTION AGREEMENT

     THIS AGREEMENT (“Agreement”), effective on the Effective Date (defined below), is made and
entered into between EndoSonics Corporation, a Delaware corporation, with its principal offices at
2870 Kilgore Road, Rancho Cordova, California 95670, U.S.A. (hereinafter referred to as
“EndoSonics”), and Fukuda Denshi Co., Ltd., a corporation of Japan, with its principal offices at
3-39-4 Hongo, Bunkyo-ku, Tokyo 113, Japan (hereinafter referred to as “Fukuda”).

     In consideration of the mutual promises contained herein, the parties agree as follow:

1. DEFINITIONS

     A. “Act” shall mean any act, statute, or regulation of any kind governing the products in the
U.S.A. including the Federal Food, Drug and Cosmetic Act (21 U.S.C. Sections 301 392 (1993)).

     B. “Best Efforts” shall mean every necessary and prudent effort of a party applied in a
prompt, commercially reasonable manner, to the maximum extent reasonably allowed by such party’s
available financial resources, taking into account all of such party’s business commitments for such
financial resources.

     C. “Cardiometrics Products” shall mean those guidewire based products for physiological
testing such as WaveWireTM and FloWireTM adapted to be utilized
on the In-VisionTM System.

     D. “Effective Date” shall mean August 31, 1998.

     E. “EndoSonics Products” shall mean all products for use with the ultrasound imaging systems
developed by EndoSonics during the term of this Agreement and available for sale during the term of
this Agreement.

     F. “QSR’s” shall mean the good manufacturing practices for medical devices set forth by any
Act governing the products in the U.S.A. including United States 21 C.F.R. Section 820 (1993).

     G. “IVUS Products” shall mean those EndoSonics intravascular ultrasound products listed in
Exhibit “A” attached hereto and all successor products thereto. IVUS Products may be changed,
abandoned or added by EndoSonics, at its sole discretion, provided that EndoSonics gives one
hundred twenty (120) days’ prior written notice to Fukuda.

     H. “Sites” shall mean a hospital or other medical facility in the Territory wherein the IVUS
Products can be used.

 

 

     I. “Territory” shall mean the country of Japan.

2. APPOINTMENT AND AUTHORITY OF FUKUDA

     A. Appointment. Subject to the terms and conditions set forth herein, EndoSonics
hereby appoints Fukuda as EndoSonics’ exclusive distributor for the IVUS Products in the Territory
for the period commencing January 1, 2000 until June 30, 2007; provided, however, for the period
from January 1, 2000 until December 31, 2001, Johnson & Johnson Medical KK (“JJMKK”) shall be
entitled to promote and sell the IVUS Products solely to JJMKK’s Sites. The parties hereto shall
determine JJMKK’s Sites and other terms and conditions for the supply to JJMKK by Fukuda on or
before December 31, 1999. Subject to the terms and conditions set forth herein, Fukuda hereby
accepts such appointment.

     Subject to the terms and conditions of this Agreement, EndoSonics shall not appoint any other
distributor, sales agent or other representative concerning the IVUS products in the Territory
during the term of this Agreement.

     B. Transition of Distribution. Fukuda hereby acknowledges that EndoSonics and JJMKK
are parties to that certain Exclusive Distribution Agreement dated June 1, 1998 (“JJMKK Agreement”)
whereby JJMKK has exclusive distribution rights to certain IVUS Products in the Territory.
EndoSonics agrees to terminate the JJMKK Agreement no later than January 1, 2000. EndoSonics, as
per Fukuda’s request, will keep Fukuda advised in regard to the termination of the JJMKK Agreement.
In addition, EndoSonics will use
Best Efforts to: (i) assist Fukuda in gaining rights to distribute to additional Sites other than
the 82 Sites specified in that certain Distribution Transition Agreement between Fukuda and
EndoSonics effective March 1, 1997 (“Distribution Transition Agreement”) as soon practical before
January 1, 2000; and (ii) extend to December 31, 1999 the rights of Fukuda pursuant to the
Distribution Transition Agreement to continued distribution of the IVUS Products already installed
by Fukuda as of the Effective Date.

     C. Other Product Rights. EndoSonics hereby grants Fukuda a right of first refusal or
right of first negotiation for the exclusive distribution of Cardiometrics Products by Fukuda in
the Territory after December 31, 1999, provided that the Cardiometrics Products are functionally
compatible with the In-VisionTM System at such time. In addition, EndoSonics hereby
grants Fukuda a right of first refusal for the distribution of all EndoSonics Products after
December 31, 1999 to the extent that EndoSonics may grant to Fukuda such rights. With respect to
all EndoSonics Products where Fukuda has the right of first refusal hereunder, EndoSonics shall
deliver written notice (“Notice”) to Fukuda should EndoSonics desire to appoint a distributor in
the Territory for such product. The parties shall negotiate in good faith an agreement for the
distribution of such product for a period of no more than sixty (60) days after Fukuda receives
such Notice. If the parties agree not to enter into a written agreement within sixty (60) from the
receipt of the Notice by Fukuda, then EndoSonics shall be free to enter into an agreement with a
third party for the distribution of such product in the Territory, but the terms and conditions are
substantially the same as those previously declined by Fukuda. EndoSonics agrees that it will not
appoint any distributor for any EndoSonics Products in the Territory on or before December 31, 1999
which may effect Fukuda’s right of first refusal granted hereunder.

-2-

 

     D. Use of Trademarks. EndoSonics hereby grants to Fukuda a non-exclusive license to
use the EndoSonics’ Trademarks (defined herein below) for the purpose of identifying and marketing the
products in the Territory. Any use of the EndoSonics’ Trademarks will be in accordance with such
instructions as EndoSonics may give Fukuda from time to time.
EndoSonics shall, at its expense,
             use
reasonable efforts to protect and maintain all registration, filings and issuance
of EndoSonics’ Trademarks in full force and effect.

     E. Fukuda Trademarks. EndoSonics shall not, without the prior written consent of
Fukuda in each instance, use in any manner whatsoever, Fukuda’s name, its trademarks, logos,
symbols or other images of Fukuda or of any party affiliated therewith.

     F. Territorial Limitation. Fukuda shall not, without the prior written consent of
EndoSonics: (i) promote, advertise, sell, distribute the IVUS, EndoSonics and Cardiometrics
Products in any country outside the Territory; (ii) cause, directly or indirectly, the importation
of the Product into any country outside the Territory; nor (iii) establish a repair or maintenance
facility in any country outside the Territory.

     G. Conflict of Interest. Commencing on January 1, 2000, Fukuda shall use its Best
Efforts in the promotion and sale of the IVUS Products and all other products to which it acquires
exclusive distribution rights hereunder, and Fukuda will not promote, advertise, sell nor
distribute directly or indirectly and products competitive to the IVUS Products or any other
products to which it acquires exclusive distribution rights hereunder.

     H. Independent Contractors. The relationship of EndoSonics and Fukuda established by
this Agreement is that of independent contractors, and nothing contained in this Agreement shall be
construed to (i) give either party the power to direct and control the day-to-day activities of the
other or (ii) allow either party to create or assume any obligation on behalf of the other party
for any purpose whatsoever. All financial obligations associated with each party’s business are the
sole responsibility of such party. All sales and other agreements between Fukuda and its customers
are Fukuda’s exclusive responsibility and shall have no effect on EndoSonics’ obligations under
this Agreement. EndoSonics shall be solely responsible for, and shall indemnify and hold Fukuda
free and harmless from, any and all claims, damages or lawsuits (including attorneys’ fees) arising
out of the acts of EndoSonics, its employees or its agents. Fukuda shall be solely responsible for,
and shall indemnify and hold EndoSonics free and harmless from, any and all claims, damages or
lawsuits (including attorneys’ fees) arising out of the acts of Fukuda, its employees or its
agents.

3. TERMS OF PURCHASE OF PRODUCTS BY FUKUDA

     A. Terms and Conditions. All purchases of IVUS Products by Fukuda from EndoSonics
during the term of this Agreement shall be subject to the terms and conditions of this Agreement.

     B. Prices. All prices are F.O.B. EndoSonics’ plant. This purchase price to Fukuda for
each of the IVUS Products (“Purchase Price”) are set forth on Exhibit “A” hereto, as such

-3-

 

Purchase Prices shall be amended from time to time during the term of this Agreement by mutual
agreement of the parties.

     The prices may be revised from time to time through consultation between EndoSonics and Fukuda,
taking into account the then prevailing market prices of the similar products. Such revisions
shall apply to all orders received after the effective date of revision. Price increases shall not
affect unfulfilled purchase orders accepted by EndoSonics prior to the effective date of the price
increase.

     C. Taxes. The amounts payable by Fukuda under Section 3 are exclusive of all taxes and
government charges (including, without limitation, interest and penalties) payable to Japanese
government, if any. If Fukuda is required to withhold any taxes on amounts payable to EndoSonics in
accordance with this Agreement, pursuant to the laws and regulations of Japan, Fukuda shall
compensate EndoSonics for any such withholding by paying EndoSonics an additional amount equal to
such amount withheld. Nothing in this Section 3.C. shall be construed to mean that Fukuda is
responsible for taxes and charges (including, without limitation, interest and penalties ) to the
federal or state government of the U.S.A. which are imposed on EndoSonics.

     D. Order and Acceptance. All orders for IVUS Products submitted by Fukuda shall be initiated
by written purchase orders sent to EndoSonics and requesting a delivery date during the term of
this Agreement; provided, however, that an order may initially be placed orally or by facsimile if
a confirmational written purchase order is received by EndoSonics
within ten (10) days after said
oral or facsimile order. To facilitate EndoSonics’ production scheduling, Fukuda shall use
reasonable commercial efforts to submit purchase orders to EndoSonics at least sixty (60) days
prior to the first day of the requested month of delivery. No order shall be binding upon
EndoSonics until accepted by EndoSonics in writing, and EndoSonics shall have no liability to
Fukuda with respect to purchase orders that are not accepted. EndoSonics shall notify Fukuda of the
acceptance or rejection of an order and of the assigned delivery date for accepted orders within
ten (10) days of receipt of the purchase order, if not rejected
within such period of ten (10) days, the order shall be deemed accepted. EndoSonics will use its Best Efforts, consistent
with its obligations to other similarly-situated customers, to process and ship all orders in
accordance with requested delivery dates by Fukuda.

     E. Terms of Purchase Orders. Fukuda’s purchase orders submitted to EndoSonics
from time to time with respect to IVUS Products to be purchased hereunder shall be
governed by the terms of this Agreement, and nothing contained in any such purchase
order shall in any way modify such terms of purchase or add any additional terms or
conditions.

     F. Payment. EndoSonics shall submit an invoice to Fukuda upon each shipment of IVUS
Products ordered by Fukuda. The invoice shall cover Fukuda’s purchase price for the IVUS
Products in a given shipment plus any freight, taxes or other applicable costs initially
paid by EndoSonics but to be borne by Fukuda. Payment shall be made in U.S. dollars and
payment shall be by wire transfer, check or other instrument approved by EndoSonics.
Payment terms shall be the full invoiced amount due for payment received by EndoSonics
within sixty (60) days of the date of the invoice. Fukuda may take a two (2) percent
discount as a reduction of the invoice

-4-

 

price if payment is received by EndoSonics within fifteen (15) days of the date of
invoice. Any invoiced amount not received within sixty (60) days of the date of invoice shall be
subject to a
service charge of one and a half percent (1.5%) per month or such lesser percentage permitted by
applicable law.

     G. Shipping. All IVUS Products delivered pursuant to the terms of this Agreement
shall be suitably packed for air freight shipment in EndoSonics’ standard shipping cartons,
marked for shipment at Fukuda’s address set forth above or any other address in the Territory
as Fukuda indicates, and delivered to Fukuda or its carrier agent F.O.B. EndoSonics’
manufacturing plant, at which time title to such IVUS Products and risk of loss shall pass to
Fukuda. Unless otherwise instructed in writing by Fukuda, EndoSonics shall select the carrier.
All freight, insurance, and other applicable expenses, as well as  any special packing
expense, shall be paid by Fukuda.

     H. Rejection of Products. Fukuda shall inspect all IVUS Products, except those IVUS
Products which are sterilized and sealed by EndoSonics at its plant, promptly upon receipt thereof
and may reject any IVUS Product that fails to meet the specifications set forth in EndoSonics’
current product specifications for that IVUS Product. Any IVUS Product not properly
rejected within sixty (60) days of receipt of that IVUS Product at Fukuda’s facility after customs
clearance for import (the “Rejection Period”) shall be deemed accepted. To reject an IVUS Product,
Fukuda shall, within the Rejection Period, notify EndoSonics in writing by facsimile of its
rejection and request a Return Material Authorization (“RMA”) number. EndoSonics shall provide the
RMA number in writing by facsimile to Fukuda within ten (10) days of receipt of the request.
Within ten (10) days of receipt of the RMA number, Fukuda shall return to EndoSonics the rejected
IVUS Product, freight collect, in its original shipping carton with the number displayed on the
outside of the carton. Provided that EndoSonics has complied with its obligations in this
Agreement, EndoSonics reserves the right to refuse to accept any rejected IVUS Products that do
not bear an RMA number on the outside of the carton. As promptly as possible but no later than
fifteen (15) working days after receipt by EndoSonics of properly rejected IVUS Products,
EndoSonics shall, at its expense, replace the IVUS Products and ship such replacement IVUS
Products freight prepaid.

     I. Return
of Products After Rejection Period. After the Rejection Period, EndoSonics’
Standard Limited Warranty shall be applied. For sterilized and sealed IVUS Products such as
catheters, however, EndoSonics shall replace those IVUS Products found defective with new IVUS
Products if such defects should be found within fifteen (l5) months of shipment of such IVUS
Products to Fukuda if a notice with the details of such defects is given by Fukuda to EndoSonics
within a reasonable period after Fukuda or the user has discovered defects or ought to have
discovered them. If EndoSonics tests and inspects these returned IVUS Products and determines
that such IVUS Products perform according to EndoSonics written specifications, no credit will be
given to Fukuda. If upon such test and inspections, such returned IVUS Products do not perform to
EndoSonics’ written specification, these IVUS Products will be
replaced at no cost to Fukuda
except in the case that EndoSonics proves that such defect was caused after the F.O.B. point of
shipment by EndoSonics to Fukuda.

-5-

 

     J. No Time Restriction. Notwithstanding any provision herein to the contrary,
Fukuda’s rights and remedies under this Agreement or laws of the Territory shall not be subject to
any time restriction that may be imposed by any provisions of the laws of non-mandatory nature so
long as Fukuda gives notice specifying the nature of the lack of conformity within a reasonable
time after Fukuda or the user has discovered it or ought to have discovered it.

4. WARRANTY TO FUKUDA’S CUSTOMERS

     A. Standard Limited Warranty. Fukuda shall pass on to its customers EndoSonics Standard
Limited Warranty for the IVUS Products. This warranty shall cover the IVUS Products for a
period of fifteen (15) months from the date of shipment to Fukuda. This warranty is contingent
upon proper use of an IVUS Products in the application for which it was intended and does not
cover IVUS Products that were modified without EndoSonics’ approval or that were subjected by
the customer to unusual physical stress. If an IVUS Product fails to meet the warranty
provided herein, EndoSonics’ sole liability and Fukuda and/or the end-user’s sole remedy shall
be either the replacement by EndoSonics of the defective unit with another unit of the same
product (or a unit of a substantially equivalent product thereto if the original model is no
longer manufactured) or the refund by EndoSonics of the purchase price for such defective
product.

     B. No Other Warranty. EXCEPT FOR THE EXPRESS WARRANTY SET FORTH ABOVE, ENDOSONICS HEREBY
DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, BY STATUTE OR OTHERWISE, REGARDING THE
IVUS PRODUCTS, INCLUDING BUT NOT LIMITED TO THEIR FITNESS FOR A PARTICULAR PURPOSE, OR THEIR
MERCHANTABILITY. OTHER THAN FOR PUNITIVE DAMAGES, NOTHING IN THIS SECTION 4. SHALL LIMIT THE
INDEMNIFICATION OBLIGATION UNDER SECTION 8.A.
WITH RESPECT TO DAMAGE CLAIMS FOR PERSONAL INJURY AND/OR DEATH CAUSED BY DEFECT OF THE
IVUS PRODUCTS.

5. ADDITIONAL OBLIGATIONS OF ENDOSONICS AND FUKUDA

     A. Clinical Trials; Management Product Supply and Regulatory
Approvals. Fukuda agrees that it will undertake to manage, at Fukuda’s expense,
all animal trials and human clinical trials required to obtain approval from all
Japanese regulatory authorities to market in the Territory the IVUS Products and all
other products to which Fukuda acquires exclusive distribution rights under this
Agreement. Fukuda agrees to expeditiously submit for Ministry of Health and Welfare
(“MOHW”) approval for In-VisionTM System and upon receipt of such
approval, transfer the approval to the party specified by EndoSonics. Fukuda will
continue to process the existing submission for the amended Oracle 96TM 
System and transfer such approval to JJMKK in accordance with the Distribution
Transition Agreement. EndoSonics will use Best Efforts to cause JJMKK to transfer to
Fukuda all MOHW approvals held by JJMKK on products to which Fukuda acquires
exclusive distribution rights hereunder upon the termination of the JJMKK Agreement. Any
costs and expenses which exceed the amount paid by JJMKK to Fukuda

-6-

 

in consideration of the transfer of the MOHW approvals from Fukuda to JJMKK will not be the
responsibility of Fukuda.

     EndoSonics agrees that it will sell products to Fukuda to conduct the animal trials and human
clinical trials for Japanese marketing approval at a fifty percent (50%) discount to EndoSonics’
regular prices to Fukuda. Payment for these products will be sixty (60) days following shipment from EndoSonics. Shipment costs will be added to invoice amounts.

     EndoSonics shall assist Fukuda in obtaining regulatory approvals and registration of the products
in the Territory by providing Fukuda with;

     (i) materials in EndoSonics possession necessary to obtain MOHW approvals and marketing approvals,
licenses, and permits;

     (ii) certificates of analysis, export and compliance;

     (iii) trademark authorizations; and

     (iv) such other information as Fukuda shall reasonably request from time to time.

     EndoSonics agrees to train Fukuda in the proper clinical use of all IVUS Products, and Fukuda
shall be responsible in turn for training their customers. Also at Fukuda’s request, EndoSonics
agrees to make arrangements to send one of EndoSonics’ major U.S. Clinical Investigator Physicians
to Japan to (i) give lectures on the use of these products and (ii) perform clinical training of
these products to Japanese physicians. Fukuda agrees to reimburse EndoSonics for all out-of-pocket
expenses for the travel of this physician to Japan.

     B. Minimum Purchases. Commencing on January 1, 2000 until the termination or expiration of
this Agreement, Fukuda commits to purchase from EndoSonics certain annual minimum quantities of
IVUS Products (“Minimums”). The Minimums for the calendar year 2000 shall be the greater of : (i)
JJMKK’s purchases of IVUS Products for the 1998 calendar year plus twenty percent (20%); or (ii)
JJMKK’s purchases of IVUS Products for the 1999 calendar year plus ten percent (10%). EndoSonics
shall provide Fukuda with sufficient documentary evidences, such as purchase orders of JJMKK, to
certify JJMKK’s purchases for the 1998 and 1999 calendar years by January 15, 2000. Fukuda shall use
reasonable commercial efforts to ensure that the annual purchase commitment is reasonably
distributed over each calendar quarter. For each calendar year after
2000, the parties shall discuss in good faith and agree upon Minimums in writing no later than six
(6) months prior to the commencement of such calendar year. If Fukuda fails to purchase the
required Minimums in any calendar year, EndoSonics may, as the sole remedy for Fukuda’s failure to
purchase the Minimums, upon thirty (30) days written notice to Fukuda, either terminate this
Agreement or render non-exclusive the distribution rights granted to Fukuda in Section 2.A.

     C. Forecasts. Within the first ten (10) days of every quarter, Fukuda shall provide EndoSonics
with a four quarter rolling forecast (“Forecast”) showing prospective orders by product model and
intended purchase order submittal date. The quantities forecasted for the first quarter of each
Forecast (“Binding Quarter”) shall be binding on Fukuda and deemed supported by a non-cancelable
purchase order. In addition, the quantities corresponding to the Binding

 -7-

 

Quarter of the next four quarter rolling forecast may not be less than 50% of the quantities
corresponding to the second quarter forecast of the previous Forecast.

     D. Promotion of the Products. Fukuda shall, at its own expense, use its
best efforts to promote the sale of the IVUS Products within the Territory. Such
promotion shall include, but not be limited to, preparing promotional materials in
languages appropriate for the Territory, advertising the IVUS Products in trade
publications within the Territory, participating in appropriate trade shows to the
extent Fukuda thinks fit, and directly soliciting orders from customers for the IVUS
Products.

     E. Finances and Personnel. Fukuda shall devote sufficient financial
resources, technically qualified sales personnel, and service personnel to the IVUS
Products to fulfill its responsibilities under this Agreement.

     F. Customer and Sales Reporting. Fukuda shall, at its own expense.

          (i) place the IVUS Products in Fukuda’s catalogues as soon as
possible and feature IVUS Products in any applicable trade show that it
attends to the extent Fukuda thinks fit;

          (ii) provide adequate contact with existing and potential
customers within the Territory on a regular basis, consistent with good
business practice;

          (iii) assist EndoSonics in assessing customer requirements for the
IVUS Products, including modifications and improvements thereto, in terms of
quality design, functional capability, and other features;

          (iv) submit market research information, as reasonably requested
by EndoSonics, regarding competition and changes in the market within the
Territory; and

          (v) provide EndoSonics with a report, by product type, of all
sales of IVUS Products for each quarter no later than thirty (30) days
following the end of such quarter.

     G. Import Requirements. Fukuda shall, at its own expense pay all import
licenses and permits, pay customs charges and duty fees, imposed by any Japanese
governmental authority upon or applicable to any import by Fukuda under this
Agreement, and take all other actions required to accomplish the import of the IVUS
Products purchased by Fukuda.

     H. Export Law Compliance. Fukuda understands and recognizes that the
Product and other materials made available to it hereunder may be subject to the
export administration regulations of the United States Department of Commerce and other United States government regulations, as amended from time to time, related to the export
of technical data and equipment and products produced therefrom. Fukuda agrees to
comply with all such regulations in connection with the distribution of the IVUS
Product. Fukuda agrees to cooperate with EndoSonics and to provide EndoSonics with
such reasonable assistance as is required in order to comply with the export
administration regulations of the United States. Nothing in this Section 5.H. shall be construed to require that Fukuda shall bear any cost or expense required to comply with such U.S. export regulations.

-8-

 

     I. Upgrade of IVUS Products. No later than June 30, 1999, Fukuda hereby agrees to
upgrade the Oracle 96TM Systems installed as of the Effective Date to: (i)
conform to the specification for the
In-VisionTM Systems, and (ii) Include both
the ChromaFloTM and In-Line DigitalTM features. EndoSonics shall
supply to Fukuda kits required for such upgrade at the following prices:

	 	 	 	 	 
	Feature 	 	Price per Unit (U.S.$)
	Upgrade to In-VisionTM System
	 	$	10,000	 
	 	 	 	 	 
	Addition of ChromaFloTM and In-Line
DigitalTM to the In-VisionTM System
	 	$	13,000	 

     J.r In-VisionTM
System Promotional Allowances. During 1999, up
to 10 In-VisionTM Systems may be purchased by Fukuda from JJMKK for which
EndoSonics will provide promotional allowances to Fukuda. The promotional allowances
will be the amount of the difference in price between EndoSonics then current selling
price of an In-VisionTM  System to JJMKK and fifty-two thousand dollars
($52,000), but not to exceed thirty-two thousand five hundred dollars ($37,500). The
promotional allowances will be paid within thirty (30) days after the end of the 1999
calendar quarter in which Fukuda purchases the In-VisionTM Systems.

6. ADDITIONAL OBLIGATIONS OF ENDOSONICS 

     A. Supply of Sample Products and Materials. EndoSonics
shall supply Fukuda’s requirements for the IVUS Products in the Territory
consistent with the delivery schedules and the Minimums. EndoSonics shall
promptly provide Fukuda without any charges with marketing and technical
information concerning the IVUS Products as well as reasonable quantities of
brochures, instructional material, advertising literature, and other IVUS
Product data, with all such material printed in the English language.
EndoSonics agrees to discuss with Fukuda for supplying appropriate number of
sample IVUS Products or granting a fifty percent (50%) discount for
appropriate number of IVUS Products for assistance of Fukuda’s sales.

     B. Response to Inquiries. EndoSonics shall promptly
respond to all inquiries from Fukuda concerning matters pertaining to this
Agreement.

     C. Testing. EndoSonics shall test all IVUS Products
before shipment to Fukuda under U.S. FDA GMP or QSR requirements.

-9-

 

     D. Delivery Time. EndoSonics shall minimize delivery time as much as possible and to fulfill
delivery obligations as committed in any acceptance.

     E. Territorial Inquiries. EndoSonics shall submit to Fukuda any inquiry originating from the
Territory rather than answering the inquiry directly.

     F. Quotations to exporters. EndoSonics shall refrain from giving quotations to exporters whom
EndoSonics knows or has reason to suspect will ship IVUS Products to the Territory.

     G. Market Information. Upon reasonable request of Fukuda, EndoSonics shall provide Fukuda with
information as to general market movement, competitors’ prices and strategies, names of EndoSonics’
major customers (users) and other information that may help Fukuda promote and sell the IVUS
Products in the Territory.

     H. Customer’s Special Requirements. In case Fukuda encounters requests from customers for special
changes or modifications on IVUS Products so that the IVUS Products meet their particular usage. In
such cases, if Fukuda deems it necessary to comply with such requirements for its market strategy,
Fukuda shall request EndoSonics to make such changes or modifications on the IVUS Products and
EndoSonics shall use its reasonable commercial efforts to meet such requirements.

     I. New Developments. EndoSonics shall inform Fukuda of new IVUS Product developments
during regularly scheduled quarterly reviews.

     J. Regulatory Reporting and Analysis of Returned Products. EndoSonics shall file, or cause to be
filed, all reports required of a manufacturer pursuant to the applicable U.S. medical device
reporting regulations. EndoSonics, as the manufacturer of the products, shall perform all failure
analysis on the products within thirty (30) days of receipt of each failed product and shall file
all reports required with the applicable U.S. regulatory agency. EndoSonics shall further cooperate
with and assist Fukuda in submitting all reports that Fukuda, as distributor of the products, may
be required to file. Fukuda shall promptly provide EndoSonics with copies of all such reports.

7. TERM AND TERMINATION

     A. Term. This Agreement shall be effective on the Effective Date and shall continue in
force through June 30, 2007, unless terminated earlier under the provisions of this
Section 7. Six (6) months prior to expiration, the parties will meet to discuss in good
faith an extension to this Distribution Agreement. Thereafter the term of the Distribution
Agreement may be renewed by mutual agreement of the parties for successive periods of two
(2) years each, provided that (i) Fukuda has fulfilled its minimum purchase obligation
agreed upon with EndoSonics on or before September 30 of each year and (ii) the parties
mutually agree to minimums for each extension year.

-10-

 

     B. Termination
for Cause. If either party materially defaults in the performance any
obligation in this Agreement, then the non-defaulting party may give written notice to the
defaulting party that if the default is not cured within ninety (90) days after receipt of such
notice, the Agreement will be terminated. If the non-defaulting party gives such notice and the
default is not cured during the ninety-day period, then the Agreement shall automatically terminate
at the end of that period.

     C. Termination
for Insolvency. This Agreement shall terminate, without notice, (i) upon the
institution by or against Fukuda or EndoSonics of insolvency, receivership or bankruptcy
proceedings or any other proceedings for the settlement of debts; (ii) upon Fukuda’s or EndoSonics’
making an assignment for the benefit of creditors; or (iii) upon Fukuda’s or EndoSonics’
dissolution.

     D. Fulfillment
of Orders upon Termination. Upon termination of this Agreement, EndoSonics
shall continue to fulfill, subject to the terms of Section 3 above and if so requested by Fukuda,
all orders accepted by EndoSonics prior to the date of termination.

     E. Return
of Materials. All trademarks, trade names, patents, copyrights, designs,
drawings, formulas or other data, photographs, samples, literature and sales aids of every kind
with respect to the IVUS Products shall remain the property of EndoSonics as long as the objects
sill remain in Fukuda’s possession. Within thirty (30) days after the termination of this
Agreement. Fukuda shall prepare all
such items in its possession for shipment as EndoSonics may direct,
at EndoSonics’ expense. Fukuda
shall not make or retain any copies of any confidential items or information or any product
literature which may have been entrusted to it. Effective upon the termination of this Agreement,
Fukuda shall cease to use all trademarks, marks and trade names of EndoSonics; provided, however,
that Fukuda may continue to use such trademarks to market, distribute or sell any inventory of the
products in Fukuda’s possession at the time of such termination as permitted pursuant to Section
7.F.

     F. Inventory
on Termination. Upon termination of this Agreement due to expiration (7.A.)
Fukuda may return to EndoSonics, or its nominee, its remaining inventory which is new and unused
for credit or refund at then current selling prices or, upon mutual agreement, for a period not to
exceed one hundred eighty (180) days, sell any remaining
inventory. Upon termination due to
Fukuda’s default or insolvency (7.B., 7.C.), Fukuda at EndoSonics’ option will return its remaining
inventory which is new and unused for credit or refund at then current selling prices or for a
period not to exceed one hundred eighty (180) days, sell any remaining inventory. Upon termination
due to EndoSonics’ default or insolvency (7.B., 7.C.), Fukuda at its option will return its
remaining inventory which is new and unused for credit or refund at then current selling prices, or
for a period not to exceed one hundred eighty (180) days, sell any remaining inventory.

-11-

 

     G. Limitation on Liability. In the event of termination by either party in
accordance with any of the provisions of this Agreement, neither party shall be liable to the
other, because of such termination, for compensation, reimbursement or damages on account of the
loss of prospective profits or anticipated sales or on account of expenditures, inventory,
investments, leases or commitments in connection with the business or goodwill of EndoSonics or
Fukuda. Termination shall not, however, relieve either party of obligations incurred prior to the
termination.

     H. Survival of Certain Terms. The provisions of Sections 2.F, 3.F, 4, 7,
8, 9, 10, 11 and 12 shall survive the termination of this Agreement for any reason.
All other rights and obligations of the parties shall cease upon termination of this
Agreement

8. LIABILITY COVERAGE AND LIMITATIONS

     A. Products Liability. EndoSonics agrees to carry products liability
insurance for all of its IVUS Products. This liability insurance will cover the
design, manufacture and performance of IVUS Products when these products are promoted,
sold and used by customers for uses specified in EndoSonics labeling, promotional
materials and instructions for use. Fukuda will be responsible for any liability
arising out of (1) Fukuda’s sales of IVUS Products for applications not included in
EndoSonics’ labeling, promotional material and instructions for use, (2) for liability
claims arising from Fukuda’s wrongful training of customer users, and (3) liability
claims arising from wrongful use of IVUS Products by Fukuda’s customers. EndoSonics
shall indemnify and hold Fukuda free and harmless from all costs, expenses and damages
incurred by Fukuda in connection with third party claims concerning personal injury or
death caused by a defect in the design or manufacture of an IVUS Product or a
non-conformance with EndoSonics’ then current specifications for IVUS Products
existing at the time of delivery of such IVUS Product by EndoSonics under Section 3.G.

     B. Limitation
on Liability. ENDOSONICS’ LIABILITY ARISING OUT OF THIS
AGREEMENT AND/OR SALE OF THE IVUS PRODUCT SHALL BE LIMITED TO THE AMOUNT PAID BY THE
CUSTOMER FOR THE IVUS PRODUCTS. IN NO EVENT SHALL ENDOSONICS BE LIABLE FOR COSTS OF
PROCUREMENT OF SUBSTITUTE GOODS. IN NO EVENT SHALL ENDOSONICS BE LIABLE TO FUKUDA OR
ANY OTHER ENTITY FOR ANY SPECIAL, CONSEQUENTIAL, INCIDENTAL, OR INDIRECT DAMAGES,
HOWEVER CAUSED, ON ANY THEORY OF LIABILITY, AND NOTWITHSTANDING ANY FAILURE OF
ESSENTIAL PURPOSE OR ANY LIMITED PURPOSE OR ANY LIMITED REMEDY. OTHER THAN FOR
PUNITIVE DAMAGES, NOTHING IN THIS SECTION 8.B. SHALL LIMIT THE INDEMNIFICATION
OBLIGATION UNDER SECTION 8.A. WITH RESPECT TO DAMAGE CLAIMS FOR PERSONAL INJURY AND/OR
DEATH CAUSED BY DEFECT OF THE IVUS PRODUCTS.

9. PROPERTY RIGHTS AND CONFEDENTIALITY

-12-

 

     A. Property
Rights. Fukuda agrees that EndoSonics owns all right, title and
interest in the IVUS Product lines that include the IVUS Products now or hereafter subject
to this Agreement and in all of EndoSonics’ patents, trademarks, trade names, inventions,
copyrights, know-how, and trade secrets relating to the design, manufacture, operation or
service of the IVUS Products. The use by Fukuda of any of these property rights is
authorized only for the purposes herein set forth, and upon termination of this Agreement
for any reason, such authorization shall cease.

     B. Sale
Conveys No Right to Manufacture or Copy. The IVUS Products are offered
for sale and are sold by EndoSonics subject in every case to the condition that such sale
does not convey any license, expressly or by implication, to manufacture, duplicate or
otherwise copy or reproduce any of the IVUS Products. Fukuda shall take appropriate steps
with its customers, as EndoSonics may request, to inform them of and assure compliance
with the restrictions contained in this Subsection 9.B.

     C. Confidentiality. Each Party shall maintain in confidence all Confidential
Information, as defined below, of the other party and shall not use, disclose or grant use
of such Confidential Information except as expressly authorized by this Agreement. A party
may disclose Confidential Information, as authorized hereunder, only to those of its
employees or agents who agree to be bound by the terms of this Section 9. Fukuda may
disclose the Confidential Information to MOHW, if and when it is so required, during the
MOHW approval proceedings, provided that Fukuda shall make its Best Efforts to avoid or
limit such disclosure. As used in this Agreement, the term “Confidential Information”
shall mean information deemed by a party to be its confidential or proprietary information
and disclosed to the other party in writing and marked “Confidential”, or disclosed orally under confidence, including without limitation,
any confidential engineering designs and drawings, know-how, trade secret, research, data,
process, technique, research project, work in process, future development, scientific,
manufacturing, marketing, business plan, financial or personnel matter relating to the
party, its present or future products, sales suppliers, customers, employees, investors or
business. Upon request of either of the parties hereto, the other party shall advise
whether or not it considers any particular information or materials to be confidential.
Fukuda shall not publish any technical description of the IVUS Products beyond the
description published by EndoSonics (except to translate that description into
appropriate languages for the Territory). In the event of termination of this Agreement,
there shall be no use or disclosure by either of the parties hereto of any Confidential
Information of the other party, provided that the restrictions under Section 9 hereof
does not in any manner affect Fukuda’s rights and/or licenses granted under any other
agreements entered into between EndoSonics and Fukuda.

     D. Exclusions.
The term “Confidential Information” shall not be deemed to
include information which: (i) is now, or hereafter becomes, through no act or failure to
act on the part of a party receiving such information, generally known or available; (ii)
is known by the party receiving such information at the time of receiving such
information, as evidenced by its records; (iii) is hereafter furnished to the party
receiving such information by a third party, as a matter of right and without restriction
on disclosure; (iv) is the subject of a written consent to disclose provided by the
disclosing party, which consent may be withheld in the sole discretion of such

-13-

 

party; or (v) is discovered or developed by a party independent of and without any
reference to Confidential Information of the disclosing party, as evidenced by the written
records of the receiving party.

10. TRADEMARKS AND TRADE NAMES

     A. Use. During the term of this Agreement, Fukuda shall have the
right to indicate to the public that it is an authorized distributor of IVUS
Products and to advertise (within the Territory) such IVUS Products under the
trademarks, marks and trade names that EndoSonics may adopt from time to time
(“EndoSonics’ Trademarks”). Fukuda shall not alter or remove any EndoSonics’
Trademarks applied to the IVUS Products at the factory. Nothing herein shall grant
to Fukuda any right, title or interest in EndoSonics’ Trademarks. At no time
during or after the term of this Agreement shall Fukuda challenge or assist others
to challenge EndoSonics’ Trademarks or the registration thereof or attempt to
register any trademarks, marks or trade name confusing similar to those of
EndoSonics.

     B. Approval
of Representations. Fukuda shall respect EndoSonics’
Trademarks and follow the instructions of EndoSonics as to the usage of
EndoSonics’ Trademarks. If any of EndoSonics’ Trademarks are to be used in
conjunction with another trademark on or in relation to the IVUS Products, then
EndoSonics’ marks shall be presented equally legibly, equally prominently, and of
the same or greater size than the other but nevertheless separated from the other
so that each appears to be a mark in its own right, distinct from the other mark.

11. PATENT COPYRIGHT AND TRADEMARK INDEMNITY

     A. Indemnification. Fukuda agrees that EndoSonic has the right to
defend, or at its option to settle, and EndoSonics agree, at its own expense,
to defend or at its option to settle, any claim, suit or proceeding brought
against Fukuda or its customer on the issue of infringement of any Japanese
patent, or trademark by the IVUS Products sold hereunder, or the use
thereof, subject to the limitations hereinafter set forth. EndoSonics shall have sole control of any
such action or settlement negotiations, and EndoSonics agrees to pay, subject
to the limitations hereafter set forth, any final judgment entered against
Fukuda or its customer on such issue in any such suit or proceeding defended
by EndoSonics. Fukuda agrees to notify EndoSonics promptly in writing of such
claim, suit or proceeding and gives EndoSonics authority to proceed as
contemplated herein, and at EndoSonics’ expense, gives EndoSonics proper and
full information and assistance to settle and/or defend any such claim, suit
or proceeding. If the IVUS Products, or any part thereof, are the subject of
any claim, suit or proceeding for infringement of any Japanese patent, or
trademark, or if the sale or use of the IVUS Products, or any part thereof,
is, as result, enjoined, then EndoSonics shall, at its expense (i) procure
for Fukuda and its customers the right under such patent, or trademark to
sell or use, as appropriate, the IVUS Products or such part thereof, or (ii)
replace the IVUS Products, or part thereof, with other suitable IVUS Products
or parts; or (iii) suitably modify the IVUS Products, or part thereof, or
(iv) if the use of the IVUS Products, or part thereof is prevented by
injunction, remove the IVUS Products, or part thereof, and refund the
aggregate payments paid therefor by Fukuda, less a reasonable sum for use and
damage.

-14-

 

     B. Limitation. Notwithstanding the provisions of Subsection 11.A. above, EndoSonics assumes no
liability for (i) infringements covering completed equipment or any assembly, circuit, combination
method or process in which any of the IVUS Products may be used but not covering the IVUS Products
standing alone; (ii) any trademark infringement involving any marking or branding not applied by
EndoSonics or involving any marking or branding applied at the request of Fukuda; or (iii) the
modification of the IVUS Product, or any part thereof, unless such modification or servicing was
done by EndoSonics.

     C. Entire Liability. The foregoing provision of this Section 11 states the entire liability and
obligations of EndoSonics and the exclusive remedy of Fukuda and its customers, with respect to any
alleged patent or trademark infringement by the IVUS Products or any part thereof.

12. GENERAL PROVISIONS

     A. Arbitration. All disputes, controversies, or differences which may arise between the parties
hereto, out of, in relation to, or in connection with this Agreement or
the breach thereof, shall be finally settled by arbitration in accordance with the Japan-American
Trade Arbitration Agreement of September 16, 1952 (as amended), by which each party hereto agrees
to be bound. If arbitration is requested by Fukuda, arbitration shall be conducted in Palo Alto,
California, U.S.A.; if arbitration is requested by EndoSonics, arbitration shall be conducted in
Tokyo, Japan. Judgment upon an award rendered may be entered in any court having jurisdiction, or
application may be made to such court for judicial acceptance of the award and an order of
endorsement, as the case may be.

     B. Entire Agreement. This Agreement sets forth the entire agreement and understanding of the
parties relating to the subject matter herein and merges all prior discussions between them. No
modification of or amendment to this Agreement, nor any waiver of any rights under this Agreement,
shall be effective unless in writing signed by the party to be charged.

     C. Notices. Any notice required or permitted by this Agreement shall be in writing and; (i) upon
personal delivery to the party be notified; (ii) when sent by confirmed facsimile if sent during
normal business hours of the recipient (if not, then on the next business day); (iii) ten (10) days
after having been sent by registered or certified airmail, return receipt requested, postage
prepaid; or (iv) four (4) business days, after being properly deposited with an internationally
recognized overnight courier, specifying express delivery, with written verification of receipt
addressed to the other party at the address shown at the beginning of this Agreement or at such
other address for which such party gives notice hereunder.

     D. Force Majeure. Nonperformance of either party shall be excused to the extent that performance is
rendered impossible by strike, fire, flood, governmental acts or
orders or

-15-

 

restrictions, failure of suppliers, or any other reason where failure to perform is beyond
the control of and not caused by the negligence of the non-performing party. ‘

     E. Change
of Control: Assignment. This Agreement including all terms
and conditions hereof which survive any
termination or expiration of this Agreement, shall be binding upon
and inure to the benefit of the
parties hereto and their permitted successors and assigns. Neither party may assign any of its
rights and obligations hereunder without prior written consent of the other party, and any such
assignment or purported assignment shall be void, except that an assignment to merger,
acquisition or sale of all or substantially all of the assets of party shall not require such
consent.

     F. Partial Invalidity. If any provision of this Agreement is held to be invalid by a court
of competent jurisdiction, then the remaining provisions shall nevertheless remain in full
force and effect. The parties agree to renegotiate in good faith any term held
invalid and to be bound by the mutually agreed substitute provision.

     G. Legal
Expenses. The prevailing party in any legal action brought by one party
against this other and arising out of this Agreement shall be entitled, in addition to any
other rights an remedies it may have, to reimbursement for its expense, including arbitration
costs and reasonable attorneys’ fees.

     H. Counterparts. This Agreement shall be executed in two counterparts, each of which shall
be deemed an original, each party retaining one copy thereof.

	 	 	 	 	 
	 

	 	ENDOSONICS CORPORATION	 	 
	 
	 	 	 	 
	 

	 	By: /s/ Reinhard J. Warnking
 

	 	 
	 

	 	PRINTED NAME: Reinhard J. Warnking	 	 
	 

	 	TITLE: President, CEO	 	 
	 
	 	 	 	 
	 

	 	FUKUDA DENSHI CO., LTD.	 	 
	 
	 	 	 	 
	 

	 	By: /s/ Kotaro Fukuda
 

	 	 
	 

	 	PRINTED NAME: Kotaro Fukuda	 	 
	 

	 	TITLE: President and Board Member	 	 

-16-

 

EXHIBIT A

TO FUKUDA DENSHI CO. LTD. AND ENDOSONICS CORPORATION

JAPANESE DISTRIBUTION AGREEMENT

Prices Effective November 1, 2005

Description of VOLCANO Products and Pricing

	 	 	 	 	 
	Distributor Name:

	 	Fukuda Intervention Systems
	 	 
	Distributor Territory:

	 	Japan	 	 

	 	 	 	 	 	 	 	 	 
	 	 	CATALOG	 	 	TRANSFER PRICE	 
	PRODUCT	 	NUMBER	 	 	 (EACH)	 
	IVG3 System:
	 	 	S7700908	 	 	 	 	 
	1-15 Units Purchased Annually
	 	 	 	 	 	[CONFIDENTIAL] USD
	16-24 Units Purchased Annually
	 	 	 	 	 	[CONFIDENTIAL] USD
	25+ Units Purchased Annually
	 	 	 	 	 	[CONFIDENTIAL] USD
	 
	 	 	 	 	 	 	 	 
	IVG/VH
	 	 	804908004	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	1-15 Units Purchased Annually
	 	 	 	 	 	[CONFIDENTIAL] USD
	16-24 Units Purchased Annually
	 	 	 	 	 	[CONFIDENTIAL] USD
	25+ Units Purchased Annually
	 	 	 	 	 	[CONFIDENTIAL] USD
	Eagle Eye Gold Catheter
	 	 	85900	 	 	[CONFIDENTIAL] USD
	Avanar Catheter
	 	 	85700	 	 	[CONFIDENTIAL] USD
	PV. 018 Catheter
	 	 	86700	 	 	[CONFIDENTIAL] USD
	PV 8.2 Catheter
	 	 	88900	 	 	[CONFIDENTIAL] USD
	TrakBack II
	 	 	91002	 	 	[CONFIDENTIAL] USD
	R100 Reusable Pullback Device — should this be here?
	 	 	804547001	 	 	[CONFIDENTIAL] USD
	Flat Panel Monitor (for use with Gold system only)
	 	 	803502-001	 	 	[CONFIDENTIAL] USD
	*Plus Upgrade (Tsunami Upgrade Kit)
	 	 	S9200100	 	 	[CONFIDENTIAL] USD
	*DICOM Connection Kit
	 	 	803183-001	 	 	[CONFIDENTIAL] USD

	 	§	 	Travel costs associated with installation are not included in product cost.
	 
	 	§	 	All prices are quoted “each” and in US Dollars
	 
	 	§	 	Volcano Corporation Terms are FOB Origin, net sixty (60) days.

	 	 	 
	 

	 	 
	Distributor Authorized Signature and Date

	 	VOLCANO Authorized Signature and Date

 

					
	Volcano Corporation
	 	CONFIDENTIAL
	 	3/14/2006

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00100-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00100-of-00352.parquet"}]]