Document:

exv10w4

 

Exhibit 10.4

PORTIONS OF THIS EXHIBIT IDENTIFIED BY “****” HAVE BEEN DELETED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

DISTRIBUTION AGREEMENT

     THIS DISTRIBUTION AGREEMENT, dated as of October 3, 2006, is by and between TopSpin
Medical (Israel) Ltd., a corporation incorporated under the laws of the state of Israel (the
“Company”) and TOP Medical B.V., an entity incorporated under the laws of The Netherlands (the
“Distributor”).

Recitals

     A. The Company is engaged in the development, manufacture, production and sale of
IntraVascular MRI catheter system for the coronary arteries.

     B. The Distributor possesses the sales force, facilities and ability to distribute, market and
promote the sale of the Company’s products in the Territory (as such term is defined below).

     C. The Company is willing to enter into this Agreement in order to avail itself of such sales
force, facilities and ability to so market and promote Company’s products.

Agreement

     Accordingly, and in consideration of the representations, warranties, agreements and
conditions herein contained, the parties hereto agree as follows:

1. Appointment

     1.1 Products. The Company’s products that are subject to this Agreement (the
“Products”) will be: (a) the products described in Exhibit A attached hereto; and (b) any
improvements to the Products or additional Company products in the Field (as such term is defined
in Exhibit A), which improvements or additional products may from time to time be included
herein and on the attached Exhibit A by mutual agreement in writing of the parties hereto.

     1.2 Exclusivity. Subject to the terms and conditions contained herein, the Company
hereby grants to the Distributor for the term of this Agreement, the exclusive non transferable
right and license to promote, advertise, market, sell and distribute the Products solely in the
geographic area set forth in Exhibit B (the “Territory”) under the Company’s name, logotype
and trademarks. Except with the express written permission of The Company, which may be granted or
denied in the Company’s sole and absolute discretion, the Distributor shall not sell the Products
to third parties located outside of the Territory and, with respect to the Product, shall not
establish any branch or maintain any distribution depot for the Products outside the Territory
(such third parties and areas being exclusively reserved to the Company or the Company’s other
distributors), provided that nothing in this Agreement is intended (and is not to be construed) to
prevent passive sales (being the sale or other disposition of the Products in response to an

 

 

PORTIONS OF THIS EXHIBIT IDENTIFIED BY “****” HAVE BEEN DELETED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

unsolicited request from a customer) of the Products by the Distributor anywhere within the
European Economic Area. The Company agrees, to the extent permitted by law and except as otherwise
provided herein, not to appoint any other person, entity or organization located in the Territory
as a distributor or reseller of the Products. The Distributor accepts this appointment and agrees
to use its best efforts in a diligent and consistent manner to promote and develop the full sale
potential of the Products in the Territory and agrees to abide by and comply with all written sales
policies and operating regulations of the Company, as modified from time to time by the Company, in
its sole discretion. In addition, Distributor agrees to take such other actions as may be necessary
or desirable to generate sales in the Territory.

     1.3 Subdistributors and Agents. The Distributor will not appoint any subdistributors
or agents to promote or distribute the Products without the prior written consent of the Company,
which may be granted or withheld in the Company’s sole and absolute discretion. The rights of any
permitted subdistributor or agent to distribute any Product will not be any greater than the rights
of the Distributor hereunder. If the Distributor enters into any written agreement with any such
subdistributor or agent, it will be subject to the prior written approval of the Company, at the
Company’s sole and absolute discretion. The Distributor will indemnify and hold the Company
harmless from and against any claim, loss, damage or expense (including attorneys’ fees) suffered
or incurred by the Company relating to any claim threatened or initiated by any subdistributor or
agent appointed by the Distributor.

     1.4 Competitive Products. During the term of this Agreement the Distributor will not,
without obtaining the prior written consent of the Company, directly or indirectly, alone, or in
any capacity with another firm, whether as an agent, consultant, independent contractor,
distributor, broker or otherwise, manufacture, promote, sell, distribute or offer for sale or
distribution any goods, products or articles (collectively “Act”) that, in the Company’s reasonable
judgment, directly or indirectly, compete with, perform similar functions to or are used for the
same general purposes as the Products or with the Company in the field of Intravascular diagnostic
catheters and related areas, except with the prior written consent of the Company. For a period of
3 months following the termination of this Agreement, for any reason whatsoever, the Distributor
will not Act in such manner that, in the Company’s reasonable judgment, directly competes with,
performs similar functions to or are used for the same general purposes as the Products or with the
Company in the field of Intravascular diagnostic catheters and related areas, except with the prior
written consent of the Company. Any breach of this Section 1.4 will entitle the Company to
terminate the Agreement in accordance with Sections 7.2(c)(ii) hereunder, without derogating from
any other remedy that the Company may be entitled to in accordance with this Agreement and any
applicable law.

2. Orders for Products

     2.1 Purchase Orders. The Distributor will, from time to time, submit written purchase
orders to the Company for the Products. Each purchase order will, at a minimum, include: (a)
identification of the Products ordered; (b) quantity, which, with respect to each purchase
order, will not include less than the minimum of Products detailed in Exhibit D; (c)
requested delivery date; and (d) shipping instructions and shipping address. The Distributor will
submit purchase

 

 

PORTIONS OF THIS EXHIBIT IDENTIFIED BY “****” HAVE BEEN DELETED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

orders to the Company based on purchase orders the Distributor receives from the
end user customers. Products will be shipped and delivered only after Distributor submits a
purchase order to the Company.

     2.2 Acceptance of Orders. All purchase orders are subject to acceptance by the
Company, and no order will be binding upon the Company until the same has been accepted in writing
or by e-mail by the Company. Purchase orders for the Products must be received by the Company at
least **** days prior to the delivery date requested. Each purchase order will be deemed to be an
offer by the Distributor to purchase the Products pursuant to the terms of this Agreement and, when
accepted by the Company, will give rise to a contract between the Distributor and the Company for
the sale of the Products ordered and will be subject to and governed by the terms of this
Agreement. The terms and conditions of this Agreement will govern and supersede any additional or
contrary terms set forth in the Distributor’s purchase order or any Company or the Distributor
acceptance, confirmation, invoice or other document unless duly signed by an officer of the
Distributor and an officer of the Company and expressly stating and identifying which specific
additional or contrary terms will supersede the terms and conditions of this Agreement. It is
expressly understood that the obligation of the Company to sell any Product to the Distributor is
subject to the availability of such Product. The Company reserves the right to allocate available
supplies of the Products among its distributors and customers as it, in its sole discretion,
determines to be appropriate. The Company will make reasonable efforts to fill each order that is
accepted, but the Company will not be liable for damages caused by failure to ship or delay in
shipment resulting from conditions beyond the control of the Company including, but not limited to,
the inability of its suppliers to obtain materials and supplies or to produce sufficient components
to meet Product sales demands.

     2.3 Forecasts. Upon execution of this Agreement, the Distributor will provide the
Company with a written twelve (12) month forecast of its expected orders of Products in the
Territory. Thereafter, on the 10th day of each month, the Distributor will furnish to the Company a
written rolling twelve (12) month forecast of its expected orders of Products in the Territory.
Each forecast provided to the Company will constitute a non-binding good faith estimate of expected
orders for Products. Except for the Minimum Product Requirement (defined in Section 5.1 below), the
Distributor will not be obligated to purchase, and the Company will not be obligated to deliver,
any units of Products unless the Distributor has submitted, and the Company has accepted and
consented, a written firm purchase order. In the event the Distributor places a purchase order less
than **** days in advance of the requested delivery date for Products exceeding the applicable
forecast, the Company shall make commercially reasonable efforts to promptly fill such purchase
orders and shall schedule delivery into future periods and communicate such schedule to the
Distributor.

     2.4 Shipment. All Products sold to the Distributor by the Company in accordance with
an accepted purchase order will be shipped by the Company to the Distributor ExWorks
(“ExWorks” as defined by Incoterms 2000) at the Company’s loading dock in Ben Gurion
Airport, Lod, Israel (the “Shipping Point”). The Distributor assumes all risk of loss
upon the Company’s delivery of the Products to the Distributor’s designated carrier at the Shipping
Point, and the Company will have no further responsibility for the Products. The Distributor agrees
to

 

 

PORTIONS OF THIS EXHIBIT IDENTIFIED BY “****” HAVE BEEN DELETED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

pay (or reimburse the Company if the Company shall be required to make such payment) all
loading, freight, shipping, insurance, forwarding and handling charges, taxes, fees, storage, and
all other charges applicable to the Products after they are delivered by the Company at the
Shipping Point. Title to all goods will remain in the Company until payment for such goods has been
fully received by the Company. The Company reserves all rights with respect to delivered Products
permitted by law, including without limitation the rights of rescission, repossession, resale, and
stoppage in transit, until the full amount due from the Distributor in respect of all delivered
Products has been paid.

     2.5 Modification of Orders. No accepted purchase order will be modified or canceled
except upon the written agreement of both parties. The Distributor’s purchase orders or mutually
agreed change orders will be subject to all provisions of this Agreement, whether or not the
purchase order or change order so states.

     2.6 Inspection and Acceptance. The Distributor will conduct any incoming inspection
tests on the Products within ten (10) days of receipt by the Distributor. In the event of any
shortage, damage or discrepancy in or to a shipment of Products, the Distributor, will within ten
(10) days thereafter give notice thereof to the Company and will furnish such written evidence or
other documentation as the Company may deem appropriate. If such evidence indicates, in the
Company’s judgment, that such shortage, damage or discrepancy existed at the time of delivery of
the Products to the carrier, the Company will promptly deliver additional or substitute Products to
the Distributor. In addition, in such event, the Company will pay all loading, freight, shipping,
insurance, forwarding and handling charges, taxes, fees, storage and other charges applicable to
such additional or substitute Products. Any Products not rejected by the Distributor by written
notice given to the Company within such (20) twenty-day period will be deemed to have been accepted
by the Distributor. Following any such acceptance, the sole remedies of the Distributor with
respect to damage to or defects in the Products will be those set forth in Section 8.1.

3. Prices and Payments

     3.1 Prices. The transfer price of all Products sold hereunder, ExWorks Shipping Point,
will be the prices set forth on Exhibit C. Price changes will not apply to purchase orders
received and accepted by the Company for delivery prior to the effective date of any price change.

     3.2 Payment Terms. The Company will invoice the Distributor upon shipment of
Products. All invoices will be due and payable to the Company through wire transfer, in full within
**** days from the date of the invoice. At any time during the term of this Agreement, the
aggregate amount of all invoices due and payable to the Company will not exceed the amount set
forth in Exhibit C attached hereto (the “Maximum Amount”). In the event any purchase order
issued by the Distributor involves payments to the Company which, together with all other
amounts due to the Company by Distributor will exceed the Maximum Amount, all such exceeding
amounts will be paid to the Company by the Distributor in advance upon the delivery to the Company
of such purchase order. Interest at the rate of **** % per month, or such lesser

 

 

PORTIONS OF THIS EXHIBIT IDENTIFIED BY “****” HAVE BEEN DELETED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

rate as is the
maximum rate of interest permitted by law, will be charged on all overdue accounts. Notwithstanding
the above, from and after an overdue invoice has not been paid in full within **** days of the ****
days detailed hereinabove, all payments hereunder will be made by irrevocable letter of credit in
form satisfactory to the Company advised through and/or confirmed by a bank designated by the
Company. Such letter of credit must be opened or confirmed by such bank at least **** days prior to
the requested delivery date of the Products covered; must permit partial payment; must provide for
payment to the Company of the purchase price plus prepaid freight, costs and insurance, if any,
upon presentation of shipping documents and the overdue invoice in accordance with the terms of
such letter of credit; and must be payable immediately upon presentation of appropriate shipping
documentation and the overdue invoice. In the event the Distributor fails to meet such terms of
payment, in addition to and not by way of limitation of the Company’s other rights under this
Agreement and at law, the Company reserves the right at any time to alter terms of payment so that
future shipments will be made only on such basis as the Company determines will ensure payment for
such shipments. All payments made under this Agreement will be made in U.S. dollars, free of any
currency control or other restrictions.

     3.3 Taxes. The Distributor will be responsible for, and will pay or reimburse the
Company for, all taxes, duties, import deposits, assessments and other governmental charges,
however designated, based on the amounts payable hereunder, or on the Products, their import into
the Territory or their sale or use, which are now or hereafter imposed under or by any governmental
authority or agency. All payments to be made by the Distributor to the Company pursuant to this
Agreement represent net amounts the Company is entitled to receive and will not be subject to any
deductions for any reason whatsoever. In the event any of the payments to be made by the
Distributor to the Company pursuant to this Agreement become subject to taxes, duties, assessments
or fees of whatever kind levied in the Territory, said payments to the Company will be increased to
such an extent as to allow the Company to receive the net amounts due under this Agreement.

     3.4 Resale Prices. The Distributor may resell the Products at such prices as it, in
its sole discretion, determines. The Distributor will, provide the Company, in writing on a monthly
basis, with the monthly average selling prices of the Products in the Territory.

4. General Obligations of Distributor.

     4.1 Marketing. The Distributor will act in a diligent manner to further the
promotion, marketing, sale and other distribution of the Products in the Territory.

     4.2 Responsibilities. Without limiting the generality of Section 4.1, the Distributor
will:

     (a) respond to any reasonable requests for market information requested by the Company
and provide the Company written responses to such requests.

     (b) maintain an adequate sales force dedicated on a full-time basis necessary for the
sale and support of the Products in the Territory.

 

 

PORTIONS OF THIS EXHIBIT IDENTIFIED BY “****” HAVE BEEN DELETED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

     (c) ensure that its sales personnel representing the Products receive complete training
with respect to the promotion and use of the Products, as provided by the Company.

     (d) ensure that its sales personnel undertake regular visits to customers or potential
customers in order to establish or maintain, as the case may be, a personal relationship
with such customers and provide support and services for the end user customers of the
Products in accordance with the Company’s services and support policies as amended from time
to time.

     (e) participate actively in sales, marketing and servicing programs prepared by the
Company and develop and implement sales programs for the promotion of the Products in a
scope of not less than the scope set forth in Exhibit G.

     (f) attend and provide support for the Products at appropriate medical trade shows and
congresses each year in the Territory, as agreed upon by the Company and the Distributor, in
a scope of not less than the scope set forth in Exhibit G; the Distributor shall pay
all related costs.

     (g) to the extent requested by the Company, provide personnel and logistical support
for clinical studies of the Products and publication of clinical study results in medical
journals.

     (h) support and promote active clinical use of the Products.

     (i) maintain an adequate and balanced inventory of the Products and related supplies
and accessories so as to be able to promptly fill all orders from customers; the Distributor
shall allow the Company to review actual inventory levels and suggest target levels of
inventory upon request by the Company. The Distributor will sell such inventory on a FIFO
basis.

     (j) provide monthly written inventory counts of the Product(s) to the Company no later
than the 5th day following a calendar month ending date.

     (k) ensure at all times proper storage and handling procedures for the Products, taking
all steps to avoid subjecting the Products to excessive heat, sunlight, humidity, dryness,
insects or animals, or other damaging conditions and will comply with all the Company’s
instructions with regard to the same, as provided to the Distributor by the Company from
time to time.

     (l) promptly respond to all inquiries from customers, including complaints, process all
orders, and effect all shipments of the Products; the Distributor shall provide the Company
with written summaries of such inquiries and responses on a monthly basis.

     (m) shall be responsible as the first point of contact for technical support with the
customer and/or end-users. The Distributor will provide a line of communications

 

 

PORTIONS OF THIS EXHIBIT IDENTIFIED BY “****” HAVE BEEN DELETED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

directly to
the Company and the Authorized Representative named in Exhibit F in matters of
vigilance and post-market surveillance (early warning) in accordance with any applicable
law, rule or regulation, including the European Commission Guidelines On A Medical Devices
Vigilance System. The Distributor will further provide this technical support on the usage
of Products to the customers based on information supplied by the Company from time to time.
Customer feedback, the occurrence of incidents, near-incidents and inquires from Competent
Authorities (as defined below) will be reported by the Distributor within three (3) business
days directly to the Company contacts named in Exhibit F, or within such earlier
period enabling the Company to properly comply with any reporting obligations under any
applicable law. The Distributor’s reporting should follow the European Commission Guidelines
On A Medical Devices Vigilance System.

     (n) establish and maintain a complaint file of any information, including written and
oral communications, received by the Distributor or any subdistributor and agent concerning
customer feedback, the occurrence of incidents and near-incidents and allow the Company, any
Authorized Representative appointed by the Company or any relevant national authority to
inspect and review such complaint file.

     (o) establish and maintain traceability to the Product lot number and related supplies
and accessories to the customers; in the matter of vigilance, the Distributor shall provide
the traceability of the particular units requested by the Company within a reasonable time,
not to exceed five (5) days.

     (p) diligently investigate and pursue all leads with respect to potential customers
referred to it by the Company and, upon request of the Company, report the status of such
leads and inquiries.

     (q) provide the Company contemporaneously with the execution of this Agreement with a
comprehensive marketing plan, developed in conjunction with the Company’s marketing
department, in the form and detail reasonably requested by the Company, and update such
marketing plan with respect to each forthcoming calendar year (divided into 12 monthly
periods) prior to the end of the then-current year or at such intervals as the Company may
otherwise require. The Company hereby acknowledges that the marketing plan provided by the
Distributor upon execution of this Agreement is in a form and detail that is acceptable for
purposes of this Section 4.2(n).

     (r) provide the Company within ten (10) days of the end of each quarter a detailed
written report of the Distributor’s sales and marketing activities, of all installed base
(i.e. hospitals or other medical centers in which the Company’s Console Product (as defined
in Exhibit A herein) is installed or based, and of all sales of the Products during
such quarter, including quantity of Products sold by product and model, by end customer,
including address, and the average sale price for each of the Products for such quarter.

     (s) transmit promptly to the Company all inquiries and orders received by the
Distributor from customers located outside the Territory.

 

 

PORTIONS OF THIS EXHIBIT IDENTIFIED BY “****” HAVE BEEN DELETED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

     (t) provide its customers with all necessary and appropriate training and support
regarding the use of the Products and maintain reasonably detailed records of such training.

     (u) within fourteen (14) days of the request by the Company, provide the Company with
quarterly financial statements and any financial information with regard to any limitations,
confines or restrictions on the Distributors bank accounts or banking credit facilities.

     (v) permit the Company, any Authorized Representative appointed by the Company and any
relevant national authority, upon reasonable notice, to visit and observe the Distributor’s
places of business and those of the Distributor’s subdistributors and accompany the
Distributor or any subdistributor or agent permitted to be appointed by the Company pursuant
to Section 1.3 during sales calls or training sessions with customers.

     (w) not, in any way, alter the Products or remove, cover, change, alter or add to the
labels attached to the Products by the Company, except with the Company’s prior written
approval.

     For the avoidance of doubt and unless otherwise explicitly provided herein, the Distributor
will not be entitled to any compensation for the performance of the above obligations.

     4.3 Support of Products. The Distributor will provide such after-sales services which
the Company will from time to time specify that the Distributor perform for customers within the
Territory and will at all times maintain a sufficient staff of resident personnel fully trained and
qualified to perform such support services.

     4.4 Purchase of Demonstration Products. In consultation with the Company and based on
the limitations detailed herein, the Distributor will deliver a purchase order to the Company for
the receipt of Products for demonstration purposes only. Such Products for demonstration purposes
will not be used for resale and will be comprised of non functional Catheters (as such term is
defined in Exhibit A hereto) at the quantities set forth on Exhibit C (as amended by the
parties upon the inclusion of additional products in this Agreement) and shall be free of charge.
Notwithstanding the above, any delivery of Products for demonstration purposes will be subject to
the availability of such non-functional Products by the Company, taking into account, among others,
the Company’s obligations to provide such non-functional Products to other distributors.

     4.5 Product Manager and Training. The Distributor shall maintain a product manager
designated to the Products. The Distributor will, at least three times per year during the term of
this Agreement, send all sales representatives and any other person (including any subdistributors
or agents permitted to be appointed by the Company pursuant to Section 1.3) who will promote,
market, sell or otherwise distribute the Products in the Territory to a place in the
Territory for sales and support services training concerning the Products at Distributor’s
expense. In the event improvements to the Products or additional Company products are added to
this

 

 

PORTIONS OF THIS EXHIBIT IDENTIFIED BY “****” HAVE BEEN DELETED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

Agreement and included within the definition of “Product” from time to time pursuant to
Section 1.1, the Company will, in its sole discretion, provide similar training. All employees or
other individuals sent by the Distributor to the Company’s headquarters or such other site for
sales and support services training concerning the Products should be able to speak, read and write
English and must have a solid understanding of cardiac medical devices. The Distributor may,
however, send a translator to assist such employees or other individuals sent by the Distributor in
the training process, including assisting such persons in understanding the examinations required
below. The Distributor will be responsible for all travel (including travel to and from Israel),
hotel and subsistence expenses incurred by its employees and other individuals receiving training
hereunder (and the translator). The Company will not be liable for any injury or property damage
suffered by the Distributor’s employees or other individuals receiving training hereunder (or the
translator). The Company will have the right to discontinue training pursuant to this Agreement and
withhold certification without further liability to the Distributor, as to any employee of the
Distributor or other individual who is unable to pass required written, oral and/or practical
examinations by the Company.

     4.6 User Manuals and Marketing Materials. The Distributor shall be responsible for the
preparation of sales literature, advertising materials, user documentation, user manuals, sales and
marketing materials for the training, marketing and sale of the Products (collectively,
“Materials”) for use in the Territory, including the translation, adaptation and/or modification of
the Company’s Materials, as deemed appropriate by the Distributor, to reflect the culture or
business practices and languages of the Territory and in accordance with the Company’s policy with
regard to the Materials, in the Company’s sole and absolute discretion. The Distributor will
prepare all Materials in compliance with all applicable laws and shall submit any newly created
Materials to the Company for its prior written approval before using or distributing such
Materials. A final copy of all translated Materials, together with a certification that the
translation accurately reflects the contents of the original English language version, shall be
forwarded to the Company for its records.

     4.7 Misrepresentations. The Distributor will not make any false statements,
representations, warranties or advertisements regarding any of the Products which exceeds in scope
or is different in meaning from the statements made by the Company in its own literature or
specifications or approved indications for use or regarding the Company in promoting sales of the
Products, and the Distributor will hold the Company harmless from and indemnify it against any
liability which may arise out of, or result from, any such false representation.

     4.8 Records, Recall and Audit. The Distributor will maintain complete and accurate
written records of all Products sold by the Distributor and any subdistributors or agents permitted
by the Company to be appointed pursuant to Section 1.3 and will maintain and provide such other
records and reports as the Company may reasonably request. The Distributor will notify the Company
immediately and confirm such notice in writing if the Distributor obtains information indicating
that any of the Company’s Products may have to be recalled, either by virtue of applicable law or
good business judgment. In the event of a recall of any of the Products, the
Distributor will cooperate fully with the Company in effecting such recall, including without
limitation, immediately contacting any purchasers that the Company desires to be contacted and

 

 

PORTIONS OF THIS EXHIBIT IDENTIFIED BY “****” HAVE BEEN DELETED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

promptly communicating to such purchasers the information or instructions the Company desires to be
transmitted. The Distributor agrees to comply with any and all traceability programs in effect at
any time as initiated by the Company. The Distributor will permit the Company, any of the Company’s
Authorized Representatives and any relevant national authority to examine, inspect and audit such
records and make transcripts of any records required as part of a traceability program at
reasonable times during business hours. The Company shall have the right to hire an independent
certified public accountant to inspect all such records so required to be kept by the Distributor
(which accountant shall agree in writing to keep all information confidential except as needed to
disclose to the Company any discovered discrepancies); provided, such audit: (i) is conducted
during normal business hours, (ii) is conducted no more often than once per year (unless a
discrepancy is discovered), and (iii) is conducted only after the Company has given the Distributor
five (5) days prior written notice. The Company shall bear the full cost and expense of such audit,
unless a discrepancy is discovered, in which event the Distributor shall bear the full cost and
expense of such audit. Regardless of the amount of discrepancy discovered, all discrepancies (and
interest thereon) shall be immediately due and payable.

     4.9 Import Approvals. The Distributor will be responsible for obtaining any required
licenses and permits and for satisfying all formalities as may be required to import the Products
by the Distributor into the Territory in accordance with then prevailing legislation. Each party
will cooperate fully with the other and provide all reasonable assistance to the other in
connection with obtaining any licenses or approvals contemplated by this section.

     4.10 Regulatory Compliance and Licenses. The Distributor agrees, at all times during
the term of this Agreement to fully and accurately comply with all applicable laws, regulations,
rules, standards, regulatory regulations and other instructions in the Territory applicable to the
Distributor’s purchase, storage, record keeping, promotion and resale of the Products. The
Distributor will obtain all required licenses, permits, authorizations, filings and registrations
that may be required by any governmental agency or law relating to the sale of the Products in the
Territory (collectively, the “Licenses”) at Distributor’s expense, excluding the CE Mark required
for the distribution of the Products in the European Community, or certify to the Company that such
Licenses are not required; all such required Licenses will be in the name of the Company, except
where prohibited by applicable law or regulation. In the event that such Licenses are not permitted
under applicable law to be made in the name of the Company, the Distributor will cause such
Licenses to be issued jointly in the name of the Company and the Distributor. In the event that
such Licenses are not permitted under applicable law to be made in the name of the Company or
jointly in the name of the Company and the Distributor, the Distributor will cause such Licenses to
be issued in the name of the Distributor. In any situation in which any Licenses are not solely in
the name of the Company, the Distributor will and hereby does, to the extent permitted by
applicable law, assign all rights and privileges in connection therewith to the Company or its
designee as soon as is reasonably practicable but no later than sixty (60) days after termination
or expiration of this Agreement. Any documents submitted or filed in order to obtain such Licenses
shall be subject to the Company’s written approval prior to their submission
or filing. Distributor shall provide the Company with full copies of any correspondence and
any other documents exchanged regarding said Licenses within 2 (two) business days of their
receipt.

 

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

Alternatively, the Company may choose, in its sole discretion, to obtain any or all of the
required Licenses and in such event, the Distributor shall cooperate with the Company to obtain
such Licenses.

5. Minimum Product Requirements of Distributor

     5.1 Minimum Product Requirements. The Distributor agrees to purchase from the Company,
at least the minimum quantities of Products in accordance with attached Exhibit D (the
“Minimum Product Requirement”), as amended from time to time by mutual written agreement of the
parties hereto. In the event the Distributor does not meet the Minimum Product Requirement for any
quarter it must exceed the Minimum Product Requirement for the quarter immediately following such
quarter by the number it needed to meet the Minimum Product Requirement for the previous quarter.
If Distributor fails to meet the Minimum Product Requirement plus the number it needed to make up
for a previous quarter’s shortfall, the Distributor shall have failed to meet its obligations under
this Section and the Company shall be entitled to terminate this agreement in accordance with the
provisions of Section 5.2 hereunder. Notwithstanding the aforesaid, it is hereby agreed that in the
event a Change of Control (as such term is defined in Section 7.3 below) occurs in the Company
within 6 (six) months following the termination of the Agreement in accordance with the provisions
of Section 5.2 below, the Distributor shall be entitled to the liquidated damages detailed in
Section 7.3 below.

     5.2 Special Right to Terminate or Convert Agreement. The Distributor understands and
agrees that the establishment and achievement of the Minimum Product Requirement pursuant to
Section 5.1 is the essence of this Agreement and that any failure by the Distributor to satisfy its
obligations under Section 5.1 will entitle the Company to terminate this Agreement upon ninety (90)
days’ written notice pursuant to Section 7.2, or, alternatively, the Company will be entitled, in
its sole discretion, to convert this Agreement into an entirely non-exclusive distributor
agreement.

6. General Rights and Obligations of the Company

     6.1 Marketing and Support. The Company will provide training for the Distributor’s
sales personnel representing the Products with respect to the promotion and use of the Products, in
the scope detailed in Exhibit G and refer to the Distributor for follow-up customer
inquiries and orders received by the Company from prospective customers located in the Territory.

     6.2 Sales Materials and User Documentation. The Company will provide the Distributor
with a copy of any Materials developed by the Company for the Products in English. The Distributor
will not use any other sales Materials, except those prepared in accordance with Section 4.6 above.
All expenses incurred by the Distributor with respect to creating sales and Materials and
advertising and promoting the Products will be borne by the Distributor. The Distributor will
provide the Company with a reasonable quantity of Materials prepared by the Distributor.

     6.3 Product Changes. The Company reserves the right, in its sole discretion and
without incurring any liability to the Distributor, to:

 

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

     (a) alter the specification for any Product or component thereof;

     (b) discontinue the manufacture of any Product or component thereof;

     (c) discontinue the development of any improvement to a Product or new product, whether
or not such improvement or product has been announced publicly; or

     (d) commence the manufacture and sale of improvements to Products or new products
having features which make any Product wholly or partially obsolete, whether or not the
Distributor is granted any distribution rights in respect of such improvement or new
products pursuant to Section 1.1.

     Notwithstanding the above, the Company will use reasonable efforts to provide the Distributor
with prompt written notice of such decisions and will fill all accepted purchase orders from the
Distributor for any such altered or discontinued Products of which manufacturing and commercial
deliveries have commenced.

     6.4 Export Approvals. The Company will use reasonable efforts to obtain any required
export licenses and other authorizations and permits from Israel or other applicable governments
for the sale of the Products to the Distributor.

7. Term and Termination

     7.1 Term. This Agreement will take effect as of the date first above written and,
unless terminated earlier pursuant to Section 7.2, will continue in force until three (3) years
after the date that the first CE Mark approval has been obtained for any of the Products (the “CE
Approval”), at which time this Agreement will automatically expire and terminate unless the parties
mutually agree otherwise in writing. ****

     7.2 Termination. Notwithstanding the provisions of Section 7.1, this Agreement may be
terminated in accordance with any of the following provisions:

     (a) The parties may mutually agree in writing to terminate this Agreement at any time
and for any reason.

     (b) Either party may terminate this Agreement by giving notice in writing to the other
party should an event of Force Majeure (as defined below) continue for more than six (6)
months.

     (c) The Company may terminate this Agreement immediately in the event of any of the
following:

     (i) the death, incapacity or discontinuation of an active relationship with the
Distributor for any reason of the individuals named on Exhibit E
attached hereto.

 

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

     (ii) “Cause,” which includes, without limitation, (a) fraud, misappropriation
of property, deliberate injury or attempted injury, by the Distributor or any
employees or agents of the Distributor and in each case related to the Company; (b)
any criminal activity by the Distributor or any employees or agents of the
Distributor; (c) the Distributor selling any Products, directly or indirectly, to
customers located outside the Territory; (d) violation by the Distributor of the
covenant not-to-compete set forth in Section 1.4 or its confidentiality undertakings
under this Agreement; (e) payment or non-payment by the Distributor of any invoice
more than thirty (30) days later than the applicable due date of the invoice
pursuant to Section 3.2; or (f) the breach by the Distributor of any other
provision of this Agreement and the failure of the Distributor to cure such breach
within thirty (30) calendar days after receipt of written notice from the Company
requesting such breach to be cured.

     (iii) any material change in the general management, ownership, or control of
the Distributor, including any sale, transfer, or relinquishment by the Distributor,
or by an individual named in Exhibit E attached hereto, of any substantial
interest in the ownership of the business carried on by the Distributor under this
Agreement, unless such change is approved in advance and in writing by the Company;

     (iv) the Distributor makes an assignment for the benefit of creditors; the
institution of voluntary or involuntary proceedings by or against the Distributor
under bankruptcy or insolvency laws; any general suspension by the Distributor of
payments to creditors; the Distributor files a petition of any type as to its
bankruptcy, is declared bankrupt, becomes insolvent, or goes into liquidation or
receivership; or any similar actions by or against the Distributor in respect of
bankruptcy, insolvency or actions taken by creditors generally.

     (d) The Company may terminate this Agreement upon ninety (90) days’ prior written
notice if the Distributor fails to meet the Minimum Product Requirement detailed in Section
5.1; and the Company elects to terminate this Agreement instead of converting this Agreement
into a non-exclusive arrangement pursuant to Section 5.2.

     (e) The Company may terminate this Agreement pursuant to Sections 7.3 or 7.4.

     (f) The Company may terminate this Agreement in the event that all Licenses have not
been obtained pursuant to Section 4.10 within one year from the date first above written.

     7.3 Change of Control of the Company. Notwithstanding the provisions of Section 7.1,
the Company may terminate this Agreement upon ninety (90) days’ written notice in the event of any
material change in the control of the Company, including any sale or transfer of the
business to which this Agreement relates, the sale of all or substantially all of the assets
of the Company, a merger of the Company into another entity in which the Company does not survive
and the acquisition by another person or group of persons acting together of at least fifty percent

 

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

(50%) of the outstanding voting capital stock of the Company (a “Change of Control”). The Company
and the Distributor agree that it would be impracticable or extremely difficult to fix the actual
damages resulting from a termination of this Agreement by the Company in the event of a Change of
Control of the Company under Section 7.2(e) and this Section 7.3. Therefore, the Company and the
Distributor agree that if the Company terminates this Agreement during the term of this Agreement
pursuant to Section 7.2(e) and this Section 7.3, the Company will pay the Distributor as liquidated
damages, and not as a penalty, an amount equal to ****. The parties agree that the foregoing
liquidated damages represent a reasonable endeavor by the parties to estimate a fair compensation
for the foreseeable losses that might result from such termination of this Agreement by the Company
pursuant to Sections 7.2(e) and this Section 7.3. The Distributor’s sole remedy in the event of
such termination of this Agreement by the Company will be the liquidated damages provided for in
this Section 7.3.

     7.4 Termination by the Company; Partial Termination.

     (a) In the event the Company terminates this Agreement during the term of this
Agreement for reasons other than those described in Section 7.2, the Company will pay the
Distributor as liquidated damages, and not as a penalty, an amount equal to **** .

     (b) In the event the Company has the right pursuant to the provisions of Section 7.2 to
terminate this Agreement in its entirety, the Company may elect to terminate this Agreement
solely as it applies to any specific Product by providing the Distributor with written
notice in accordance with the relevant Section referred to above; provided, that nothing in
this Section 7.4(b) will be construed as creating a precondition to or otherwise precluding
the Company from terminating this Agreement in its entirety in accordance with the terms of
Section 7.2.

     7.5 Rights and Obligations on Termination. In the event of the expiration or
termination of this Agreement for any reason, the parties will have the following rights and
obligations:

     (a) Termination of this Agreement will not release either party from the obligation to
make payment of all amounts then or thereafter due and payable.

     (b) If and to the extent applicable, the Company will have the right, at its option, to
repurchase from the Distributor all or any part of the Distributor’s inventory of Products
in good repair and which are in good re-sellable condition in the Distributor’s possession,
as of the termination date at the Company’s invoiced price (exclusive of any shipping or
packaging charges or taxes) to the Distributor for such Products. The Company may exercise
its option under this Section 7.5(b) by notifying the Distributor in writing no later than
**** days after the effective termination date. The Company may deduct any amounts owed to
it by the Distributor, whether for payment of Products or otherwise, from the amount due the
Distributor for the repurchase by the Company of the
Products. The Distributor will be permitted to resell any such inventory of Products
that the Company does not repurchase from the Distributor for a period of **** months
following the termination of the Agreement.

 

 

PORTIONS OF THIS EXHIBIT IDENTIFIED BY “****” HAVE BEEN DELETED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

     (c) The Distributor’s and The Company’s obligations pursuant to Sections 1.3, 1.4, 4.8,
4.10, 7.5, 7.6, 7.7, 10.3 and Articles 8, 9, 11, 12, 13, 14 and 15 will survive termination
of this Agreement until the obligations set forth in the applicable section are fully
satisfied and the statute of limitations has expired with respect to such obligations.

     (d) Within thirty (30) days of the date of termination, the Distributor will furnish to
the Company a list of all the Distributor’s active sales leads, current customers and the
place of destination of all Products sold or distributed in the immediately preceding twelve
(12) months and all Products whose shelf-life has not yet expired.

     (e) Upon termination, the Distributor will discontinue the use of any and all
advertising and promotional activities, and will immediately return, at the Company’s
expense, any equipment, product literature, training materials or other items provided by
the Company; provided, however, that with respect to any Products subject to Section 7.5(b)
above, if and to the extent applicable, the Distributor will not be under any obligation to
return such Products unless and until the Company has given the Distributor notice of the
Company’s intention to exercise its option under Section 7.5(b) and has paid for such
Products.

     (f) For the avoidance of doubt, after the termination or expiration of this Agreement
for any reason whatsoever, the Company shall be free to directly or indirectly contact and
engage in business with any and all of the Distributor’s customers with respect to the
Product and the Distributor shall not be entitled to any compensation from the Company with
respect to the aforesaid.

     7.6 Right to Terminate. It is expressly understood and agreed that the rights of the
Company and the Distributor to terminate this Agreement pursuant to Section 7.2 are absolute, and
that the parties have considered the possibility of such termination and the possibility of loss
and damage resulting therefrom in making expenditures related to the performance of this Agreement.
Except as set forth in Sections 7.3 and 7.4, it is the express intent and agreement of the parties
that neither will be liable to the other for damages or any other compensation by reason of the
termination of this Agreement in accordance with Section 7.1 above.

     7.7 Termination of Subdistributors and Agents. Any and all agreements between the
Company and any of the Distributor’s subdistributors and/or agents permitted in accordance with
Section 1.3 above, if and to the extent applicable, will be automatically and immediately
terminated upon the termination of this Agreement for any reason whatsoever, and without any
additional notice or action required to be taken by the Company with regard to such termination.
The Distributor will have sole responsibility for termination of any subdistributor or agent,
including any costs or expenses associated therewith, and will indemnify and hold the Company
harmless from and against any claim, loss, damage or expense (including attorneys’ fees) suffered
or incurred by the Company relating to the termination of any subdistributor or agent
appointed by the Distributor.

 

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

8. Warranty and Liability

     8.1 Warranty. The Company warrants to the Distributor that the Products will, when
delivered to the Distributor, be free from defects in materials and workmanship under normal use
and service for a period of **** months from the date of delivery to the Distributor and through
the period of the Company’s published shelf-life for the Products. The Company will in its
reasonable discretion: (a) give the Distributor a full refund of the purchase price of any Product
that it reasonably determines was defective at the time of shipment to the Distributor or that is
the subject of any breach of any warranty by the Company, or (b) replace or repair, in its
reasonable discretion, any Product that it reasonably determines was defective at the time of
shipment to the Distributor or that is the subject of any breach of any warranty by the Company,
provided such Product is returned at the Company’s expense to the Company within the warranty
periods set forth above; provided, however, that the Company will have no obligation under this
warranty to make repairs or replacements necessitated in whole or in part by accidents, fault or
negligence of the Distributor or user. Prior to returning any Product alleged to be defective, the
Distributor will notify the Company in writing of the claimed defect and will include the model and
lot/serial number of such Product, as well as the number and date of the invoice therefor. No
Product may be returned without first obtaining a returned goods authorization from the Company.

     8.2 Warranty to Customers. The Distributor will provide each of its customers that
purchases a Product a warranty identical in all material respects to that provided by the Company
to the Distributor pursuant to Section 8.1. The Distributor will provide each of its customers with
documentation provided by the Company, informing each customer that except for a breach of the
specific warranties contained in Section 8.1, the Company shall not be liable for any loss or
damage nor be subject to any other remedy. The Distributor will make no other warranties,
guarantees or representations, whether written or oral, regarding the Products, whether on its own
behalf or on behalf of the Company. Notwithstanding the foregoing, the Distributor will have the
right to translate the warranty into another language; provided, however, that the Company will
have the right to review and approve such translation prior to its distribution to customers. The
Distributor shall include in each of its agreements with its end user customers and/or any
agreement with subdistributors and/ or agents permitted by the Company in accordance with Section
1.3 above, provisions incorporating the terms hereof and confirming the customers’ and/or
subdistributors’ and/or agents’ acknowledgement of and agreement to the same.

     8.3 Limited Warranty. THE WARRANTIES SET FORTH IN SECTION 8.1 ARE INTENDED SOLELY FOR
THE BENEFIT OF THE DISTRIBUTOR. ALL CLAIMS HEREUNDER WILL BE MADE BY THE DISTRIBUTOR AND MAY NOT BE
MADE BY THE DISTRIBUTOR’S CUSTOMERS. THE WARRANTIES SET FORTH ABOVE ARE IN LIEU OF ALL OTHER
WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, AND ANY OTHER REPRESENTATIONS, TERMS, OR CONDITIONS,
WHETHER IN CONTRACT, TORT, EQUITY OR OTHERWISE WHICH ARE HEREBY DISCLAIMED AND EXCLUDED BY THE
COMPANY TO THE FULLEST EXTENT PERMISSIBLE BY LAW, INCLUDING
WITHOUT LIMITATION ANY WARRANT FOR MODIFICATIONS TO THE PRODUCTS MADE BY ANYONE OTHER THAN THE
COMPANY (OR ON ITS BEHALF) AND NOT APPROVED BY THE COMPANY IN ADVANCE AND IN WRITING, ANY OTHER ACT
OR OMISSION OF ANYONE OTHER THAN THE COMPANY.

 

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

     8.4 Delay. THE COMPANY WILL NOT BE LIABLE FOR ANY LOSS OR DAMAGE CAUSED BY DELAY IN
FURNISHING THE PRODUCTS OR ANY OTHER PERFORMANCE UNDER THIS AGREEMENT.

     8.5 Sole Remedies. THE SOLE AND EXCLUSIVE REMEDIES FOR BREACH OF ANY AND ALL
WARRANTIES AND THE SOLE REMEDIES FOR THE COMPANY’S LIABILITY OF ANY KIND (INCLUDING LIABILITY FOR
NEGLIGENCE) WITH RESPECT TO THE PRODUCTS AND ALL OTHER PERFORMANCE BY THE COMPANY UNDER THIS
AGREEMENT WILL BE LIMITED TO THE REMEDIES PROVIDED IN THIS SECTION 8 AND IN SECTION 9.

     8.6 Limitation of Liability. THE COMPANY’S LIABILITY TO THE DISTRIBUTOR IN CONNECTION,
DIRECTLY OR INDIRECTLY, WITH THIS AGREEMENT, SHALL NOT EXCEED IN ANY MANNER WHATSOEVER THE AMOUNT
ACTUALLY PAID BY THE DISTRIBUTOR TO THE COMPANY IN THE PRECEDING TWELVE (12) MONTHS.

     8.7 Consequential Damages. IN NO EVENT WILL THE COMPANY’S LIABILITY OF ANY KIND
INCLUDE ANY SPECIAL, INDIRECT, PUNITIVE, INCIDENTAL OR CONSEQUENTIAL LOSSES OR DAMAGES, EVEN IF THE
COMPANY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH POTENTIAL LOSS OR DAMAGE.

     8.8 Product Liability. Company will have a Product Liability Insurance that covers the
Territory and on which TOP Medical will be named as Distributor for Belgium, The Netherlands and
Luxembourg.

9. Patents and Intellectual Property Rights

     9.1 Intellectual Property Rights. Distributor agrees that all the rights with respect
to the Products and Materials, including, without limitation, all apatents, trademarks, copyrights,
services marks, trade names, technology, know how, moral rights and trade secrets, all applications
for any of the foregoing, permits, grants and licenses or other rights relating to the Products and
any improvement, modification, adaptation, innovation, derivation or development made to any of the
Products, including at the request of the Distributor or based on the Distributor’s ideas of
proposals (“Improvements”) (collectively, “Intellectual Property Rights”) are and shall remain at
all times the sole property of the Company. This Agreement shall not, under any circumstance, be
construed to constitute a grant to the Distributor of any Intellectual Property Rights belonging to
the Company, except as expressly provided herein. The Distributor hereby irrevocable assigns (and
shall procure that any subdistributor, if and to the
extent applicable or any employee shall assign) to the Company all right, title and interest
it (or they) have in and to any Improvements and agrees to take all action and to execute all
required documents to affect the same.

 

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

     9.2 Defense of Claims. The Company will, at its own expense, defend any suit
instituted against the Distributor which is based on an allegation that any Product constitutes an
infringement third party intellectual property rights. The Company will have control of the
defense of any such action, including any appeals and negotiations for the settlement or compromise
thereof and will have full authority to enter into a binding settlement or compromise. The Company
will indemnify the Distributor against any award of damages and costs made against the Distributor
as a result of any such action.

     9.3 Limitation of Liability. The Company will have no liability of any kind to the
Distributor under Section 9.2 or based upon any other claim the Distributor may have to the extent
any such claim is based upon or arises out of (a) the use of any Product in combination with an
apparatus or device not manufactured, supplied or approved in advance and in writing by The
Company, (b) the use of any Product in a manner for which it was not designed or intended to be
used, (c) any modification of any Product by the Distributor or any third party which causes it to
become infringing, or (d) the use of any Product not in full compliance with the Company
instructions enclosed therewith.

     9.4 Replacement Product. In order to avoid or limit any liability for infringement,
the Company may, at any time and irrespective of whether it will be obligated to do so by order of
any court, at its own expense and option, replace any Product with a non-infringing item providing
substantially the same performance.

     9.5 Infringement. The Distributor will promptly notify the Company as soon as it
becomes aware of any infringement or alleged infringement of any Intellectual Property Rights of
the Company. The Company reserves the right in its sole discretion to institute any proceedings
against such third-party infringers, and the Distributor will refrain from doing so. The
Distributor agrees to cooperate fully with the Company in any action taken by the Company against
such third parties, provided that all expenses of such action will be borne by the Company and all
damages which may be awarded or agreed upon in settlement of such action will accrue to the
Company.

10. Trademarks

     10.1 License. The Company hereby grants to the Distributor a non-exclusive,
non-transferable, and royalty-free right and license to use the Company’s trademarks, trade names
and logotypes in connection with the sale, distribution, promotion and advertising of the Products
in the Territory as long as such trademarks are used by the Distributor in accordance with the
Company’s standards, specifications and instructions, but in no event beyond the term of this
Agreement. The Distributor will not acquire any right, title or interest under the laws of any
nation in such trademarks, trade names or logotypes of the Company other than the foregoing limited
license and will not attempt to assert or register any such right, title or interest. The
Distributor will not use any of the Company’s trademarks, trade names or logotypes as part of
the Distributor’s corporate or trade names or permit any third party to do so without the
prior written consent of the Company.

     10.2 Infringement. The Distributor will promptly notify the Company of any use by any
third party of the Company’s trademarks, trade names or logotypes or any use by such third

 

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

parties
of similar marks which may constitute an infringement or passing off of the Company’s trademarks,
trade names or logotypes. The Company reserves the right in its sole discretion to institute any
proceedings against such third-party infringers, and the Distributor will refrain from doing so.
The Distributor agrees to cooperate fully with the Company in any action taken by the Company
against such third parties, provided that all expenses of such action will be borne by the Company
and all damages which may be awarded or agreed upon in settlement of such action will accrue to the
Company.

     10.3 Termination of Use. The Distributor acknowledges the Company’s proprietary rights
in and to the Company’s trademarks, trade names and logotypes, and the Distributor hereby waives
all rights to any trademarks, trade names and logotypes now or hereafter originated by The Company.
The Distributor will not adopt, use or register any words, phrases or symbols which are identical
to or confusingly similar to any of the Company’s trademarks. Upon termination of this Agreement,
the Distributor will immediately cease using the Company’s trademarks, trade names and logotypes in
any manner.

11. Confidentiality

     Simultaneously with the execution of this Agreement, the parties shall enter into a Non
Disclosure Agreement in the form attached hereto as Exhibit H.

12. Representations, Warranties and Indemnities

     12.1 Mutual Representations and Warranties. Each of the parties represents and
warrants to the other that (a) it has the right, power and authority to enter into this Agreement
and perform its obligations hereunder, and has taken all requisite organizational action to approve
and authorize its execution and delivery hereof, (b) this Agreement is valid and binding on it and
enforceable against it in accordance with the terms hereof, and (c) neither the execution nor the
performance of this Agreement will constitute a breach or violation of the terms of its charter,
incorporation or organizational documents or any contract, agreement or other commitment to which
it is a party or by which it or any of its properties are bound.

     12.2 Distributor Representation and Warranties. In addition to the aforesaid, the Distributor
represents and warrants to the Company that it has the required knowledge, experience, expertise
and financial capacity to fulfill its obligations hereunder, that it has previous experience and
knowldge regarding products similar to the Products and the applicable market in the Territory,
that it has gathered for itself and received and reviewed all the information deemed required by it
and that it is entering into this Agreement based on its independent analysis and after evaluation
for itself the merits hereof.

     12.3 Indemnification by The Company. Subject to Sections 8.3, 8.4 8.5 and 8.6 above,
the Company agrees to indemnify, defend and hold harmless the Distributor and its
subsidiaries, directors, shareholders, officers and employees from and against any amounts paid to
third parties for claims, liabilities, damages, losses, costs and expenses (including reasonable
attorneys’ fees) of any nature (“Indemnifiable Losses”) resulting from or arising out of (a) any
breach of any representation, warranty, covenant or agreement on the part of the Company under

 

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

this
Agreement, (b) the negligence, intentional or criminal act of the Company, its directors, officers,
employees and agents, or (c) personal injury, product liability or warranty claims of third parties
related to any of the Products, provided however, that the Distributor shall immediately notify the
Company in writing as soon as it becomes aware of such claim and allow the Company to defend such
claim; provided, further, that in no event will the Company be liable for the damages referenced in
Section 8.7 or matters for which the Distributor is responsible under Section 12.4 below.

     12.4 Indemnification by the Distributor. The Distributor agrees to indemnify, defend
and hold harmless the Company and its subsidiaries, directors, officers and employees from and
against any amounts paid to third parties for Indemnifiable Losses resulting from or arising out of
(a) any breach of any representation, warranty, covenant or agreement on the part of the
Distributor under this Agreement, (b) the negligence, intentional or criminal act of the
Distributor, its directors, officers, employees and agents, (c) product claims, whether written or
oral, made or alleged to be made, by the Distributor in its advertising, publicity, promotion, or
sale of any Products where such product claims were not agreed to by the Company, or (d) negligent
handling by the Distributor of the Products or changes, additions or modifications to the Products
by the Distributor; provided, however, that in no event will the Distributor be liable for matters
for which the Company is responsible under Section 12.3 above.

13. Jurisdiction

     13.1 Disputes. Any dispute, controversy or claim arising out of or relating to this
Agreement, or the breach, termination or invalidity thereof, which is not resolved between the
parties themselves, will be submitted to the competent courts of Tel Aviv, Israel.

     13.2 Governing Law. This Agreement will be governed by, and interpreted and construed
in accordance with, the laws of the State of Israel.

14. Force Majeure

     14.1 Definition. Force Majeure will mean any event or condition, not existing as of
the date of this Agreement, not reasonably foreseeable as of such date and not reasonably within
the control of either party, which prevents in whole or in material part the performance by one of
the parties of its obligations hereunder or which renders the performance of such obligations so
difficult or costly as to make such performance commercially unreasonable. Without limiting the
foregoing, the following will constitute events or conditions of Force Majeure: riots, civil or
military disturbances, war, strikes, lockouts, labor slowdowns or stoppages, prolonged shortage of
energy supplies, epidemics, fire, flood, hurricane, typhoon, earthquake, lightning and explosion.
It is agreed that any event or condition caused by the unstable political situation in Israel can
not be used as reason for the termination of this Agreement.

     14.2 Notice. If a Force Majeure event occurs, a party affected by an event of Force
Majeure will promptly notify the other party of such event. Such notice will include a description
of the nature of the event of Force Majeure, its cause and possible consequences.

 

 

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REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

     14.3 Suspension of Performance. During the period that the performance by one of the
parties of its obligations under this Agreement has been suspended by reason of an event of Force
Majeure, the other party may likewise suspend the performance of all or part of its obligations
hereunder, except for the obligation to pay any amounts due and owing hereunder, to the extent that
such suspension is commercially reasonable.

15. Miscellaneous

     15.1 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 will be acting as an independent contractor. This Agreement will not be construed in any way
to deem the Distributor an agent or franchisee of the Company for any purpose whatsoever. The
parties acknowledge that their relationship under this Agreement is that of supplier and
distributor and not that of principal and agent or of franchisor and franchisee. The Distributor
acknowledges that it has paid no fee or other consideration for any right under this Agreement. It
is the express intent of the parties, pursuant to their right to freedom of contract, that this
Agreement will govern the obligations of each to the other and the right of each resulting from
such relationship and that no state or foreign franchise law or any other law purporting to alter
the relationship between the Company and the Distributor, presently in force or hereafter enacted,
may apply to the rights and obligations of and between the parties under this Agreement. The rights
and obligations of the parties in the event of termination of this Agreement have been separately
bargained for and are intended by both parties to be in lieu of any rights or obligations arising
under any state or foreign franchise law, or any other law purporting to alter the relationship
between the parties. The time within which the Distributor may bring an action for breach of this
Agreement will be one hundred eighty (180) days from the date of such breach. No action may be
commenced after that one hundred eighty (180) day period.

     15.2 Assignment. Neither party may assign or otherwise transfer its rights and
obligations under this Agreement without the prior written consent of the other party, except that
the Company may assign this Agreement to any successor in interest of all or substantially all of
the business of the Company, whether by merger, acquisition, operation of law, assignment, purchase
or otherwise, or to any of its subsidiaries and/or affiliates. Any prohibited assignment will be
null and void. All terms and conditions of this Agreement will be binding on and inure to the
benefit of the successors and permitted assigns of the parties.

     15.3 Publicity. This Agreement is confidential and no party will issue press releases
or engage in other types of publicity of any nature dealing with the commercial and legal details
of this Agreement without the other party’s prior written approval, which approval will not be
unreasonably withheld. However, approval of such disclosure will be deemed to be given to the
extent such disclosure is required to comply with governmental rules, regulations or other
governmental requirements, including without limitation, any reporting obligations by any
governmental securities authority.

 

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

     15.4 Notices. Notice permitted or required to be given under this Agreement will be
deemed sufficient if given in writing by facsimile, commercial air delivery service or by
registered or certified air mail, postage prepaid, return receipt requested, addressed to the
respective addresses of the parties set forth below or at such other address as the respective
parties may designate by like notice from time to time. Notices so given will be effective upon the
earlier of: (a) receipt by the party to which notice is given (which, in the instance of a
facsimile, will be deemed to have occurred at the time that the machine transmitting the facsimile
verifies a successful transmission of the facsimile); (b) on the seventh business day following the
date such notice was deposited in the mail; or (c) on the third business day such notice was
delivered to a commercial air delivery service. Notices will be given as follows:

	 	 	 
	If to the Distributor:

	 	TOP Medical B.V.
	 

	 	Stationstraat 30
	 

	 	6361 BH Nuth
	 

	 	The Netherlands
	 

	 	Attn: Managing Director
	 

	 	Fax: +31 45 5244613
	 
	 	 
	If to the Company:

	 	TopSpin Medical (Israel) Ltd.
	 

	 	2 Yodfat Street
	 

	 	Lod 71921
	 

	 	Israel
	 

	 	Attn: Chief Executive Officer
	 

	 	Fax: +972-8-9259003

     15.5 Entire Agreement. This Agreement, including the exhibits attached hereto and
incorporated as an integral part of this Agreement, constitutes the entire agreement of the parties
with respect to the subject matter hereof, and supersedes all previous proposals, oral or written,
and all negotiations, conversations or discussions heretofore had between the parties related to
this agreement. The Distributor acknowledges that it has not been induced to enter into this
Agreement by any representations or statements, oral or written, not expressly contained herein.

     15.6 Amendment. This Agreement will not be deemed or construed to be modified,
amended, rescinded, canceled or waived, in whole or in part, other than by written amendment signed
by the parties hereto, except as expressly provided in this Agreement.

     15.7 Severability. In the event that any of the terms of this Agreement are in
conflict with any rule of law or statutory provision or otherwise unenforceable under the laws or
regulations of any government or subdivision thereof, such terms will be deemed stricken from this
Agreement, but such invalidity or unenforceability will not invalidate any of the other terms of
this Agreement and this Agreement will continue in force, unless the invalidity or
unenforceability of any such provisions of this Agreement substantially violates, comprises an
integral part of or is otherwise inseparable from the remainder of this Agreement.

     15.8 Counterparts. This Agreement will be executed in two or more counterparts in the
English language, and each such counterpart will be deemed an original hereof. In case of any

 

 

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REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

conflict between the English version and any translated version of this Agreement, the English
version will govern.

     15.9 Waiver. No failure by either party to take any action or assert any right
hereunder will be deemed to be a waiver of such right in the event of the continuation or
repetition of the circumstances giving rise to such right.

     15.10 No Third Party Beneficiaries. This Agreement shall be binding upon and, except
as specifically provided herein, shall inure solely to the benefit of the parties hereto and their
respective successors and assigns.

 

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

     The parties hereto have caused this Agreement to be duly executed by their authorized
representatives as of the day and year first above written.

	 	 	 	 	 	 	 	 	 
	TOPSPIN MEDICAL (ISRAEL) LTD.	 	TOP MEDICAL B. V.	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	 	 	By:
	 	 	 	 
	 

	 	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Name:

	 	 	 	Name:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Title:

	 	 	 	Title:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 

 

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

EXHIBIT A

Product:

Intravascular Catheter for the Coronary Arteries (“Catheter”)

Intravascular MRI Console (“Console”)

Field:

Intravascular MRI Catheter for the Coronary Arteries

 

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

EXHIBIT B

TERRITORY

The Territory:

Benelux (Belgium, The Netherlands and Luxembourg)

2

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

EXHIBIT C

CONSIDERATION, PAYMENT SCHEDULE AND INVOICING

Transfer Price per Product:

Catheter: ****

Console: ****

Maximum
Amount (for the Purpose of Section 3.2): ****

Quantities of Demonstration Products: ****

 

* All Prices quoted herein are net of the taxes detailed in Section 3.3.

3

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

EXHIBIT D

MINIMUM PURCHASE REQUIREMENTS

Minimum Purchase Requirements:

	 	 	 	 	 
	Year
	 	Quarter	 	Minimum Purchase Requirements*
	First Year of the Term

	 	Q1
	 	****
	First Year of the Term

	 	Q2****
	 	****
	First Year of the Term

	 	Q3
	 	****
	First Year of the Term

	 	Q4
	 	****
	Second Year of the Term

	 	Q1
	 	****
	Second Year of the Term

	 	Q2
	 	****
	Second Year of the Term

	 	Q3
	 	****
	Second Year of the Term

	 	Q4
	 	****
	Third Year of the Term

	 	Q1
	 	****
	Third Year of the Term

	 	Q2
	 	****
	Third Year of the Term

	 	Q3
	 	****
	Third Year of the Term

	 	Q4
	 	****

Minimum Purchase Requirements per each Purchase Order: 1

 

			
	*	 	All Minimum Purchase Requirements stated herein are in aggregate amounts in US$.
	 
	****	 	 

4

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

EXHIBIT E

KEY INDIVIDUALS

****

5

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
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EXHIBIT F

The Company’s Regulatory Affairs Contact Details:

TopSpin Medical (Israel) Ltd.

Attn: Regulatory Affairs

2 Yodfat Street

Lod 71921

Israel

Tel: +972-8-9200033

Fax: +972-8-9281233

Email: marina@topspin.co.il

Authorized Representative Contact Details:

CEpartner4U BV

Esdoornlaan 13

3951 DB Maarn

The Netherlands

Tel: +31-6-516-536-26

Fax: +31-343-442-162

Email: nusselder@cepartner4u.nl

6

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

EXHIBIT G

PROMOTION, MARKETING AND SERVICING SCHEDULE

List of promotion, marketing and servicing tasks of the Distributor under the agreement:

****

7

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

EXHIBIT H

NON-DISCLOSURE AGREEMENT

8

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

NON DISCLOSURE AGREEMENT

This non disclosure agreement (the “Agreement”) is entered into as of the 3rd day
of October, 2006, by and among TopSpin Medical (Israel) Ltd., a company incorporated under the laws
of the State of Israel (the “Company”) whose address for purposes hereof is 2 Yodfat St., Lod (the
“Company”), and Top Medical B.V., a company incorporated under the laws of the state of The
Netherlands (the “Distributor”) whose address for purposes hereof is Stationstraat 30, 6361 BH
Nuth, The Netherlands.

The Distributor and the Company have executed an Exclusive Distribution Agreement (the
“Distribution Agreement”), and in connection with the same the Distributor has been, and/or will
be, provided with, and/or has access to certain confidential information of the Company. With
respect to any and all information disclosed by the Company to the Distributor, the parties wish to
ensure due protection of such information.

Therefore, the parties hereby agree as follows:

9

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

1. Distributor acknowledges and agrees that it may have access to confidential and proprietary
information concerning the activities and business of the Company, its parent companies,
subsidiaries and/or affiliates, all whether in oral, written, graphic, or machine-readable form, or
in any other form, including, without limitation, concepts, techniques, processes, methods,
systems, designs, drawings, photographs, models, prototypes, computer programs, research materials,
formulas, development or experimental work, work in progress, mask work, inventions, cost data,
marketing plans, product plans, business strategies, financial information, forecasts, personnel
information and customer or supplier lists. Such information, whether documentary, written, oral or
computer generated, shall be deemed to be and referred to as “Proprietary Information”.

2. Notwithstanding the aforesaid, information shall not be deemed as Proprietary Information, for
purposes of this Agreement, if the Distributor can show documentary evidence that: (a) such
information is in the public domain at the time of disclosure, or subsequently becomes part of the
public domain, through no breach of the Distributor of its obligations hereunder; or (b) such
information is received by the Distributor from a third party exempt from confidentiality
undertakings; or (c) such information was in its possession at the time of disclosure, and the
Distributor so advised the Company immediately upon disclosure; or (d) the Distributor is compelled
by court or government action pursuant to applicable law to disclose such information, provided,
however, that the Distributor gives the Company prompt notice thereof so that the Company may seek
a protective order or other appropriate remedy, and further provided that in the event that such
protective order or other remedy is not obtained, the Distributor shall furnish only that portion
of the Proprietary Information which is legally required, and shall exercise all efforts required
to obtain confidential treatment for such information.

3. The Proprietary Information shall be used by the Distributor for the limited purposes set forth
in the Distribution Agreement.

4. The Distributor hereby acknowledges that the Proprietary Information is highly confidential, and
undertakes that, at all times, it: (i) shall treat and maintain the Proprietary Information as
confidential, and hold all such Proprietary Information in trust and in strict confidence,
utilizing the same degree of care it uses to protect its own confidential information, but in no
event less than a reasonable degree of care; (ii) shall not disclose the Proprietary Information to
any third party, whether or not for consideration; (iii) shall not use the Proprietary Information
for any purpose other than the limited purpose mentioned in Section 3 above, or exploit the
Proprietary Information for its own benefit or for the benefit of anyone else, without the prior
written consent of the Company; and (iv) shall not make any copies of the Proprietary Information
without the prior written consent of the Company.

5. Distributor undertakes to hold all Proprietary Information locked and to disclose the
Proprietary Information only to those of its employees and consultants (provided, with respect to
such consultants, that disclosure to any consultant shall be made only after receipt of written
consent of the Company) (each, a “Representative”) who have to be so informed in order to provide
the services pursuant to the Distribution Agreement, and provided that such Representatives are
bound by written confidentiality and non-use undertakings towards

10

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

Distributor which also apply to the Proprietary Information disclosed to Distributor under this
Agreement. Distributor will be responsible for ensuring that the obligations of confidentiality and
non-use contained herein are observed by all Representatives, and it represents that it has
instituted policies and procedures which provide such adequate protection for the Proprietary
Information. Without derogating from the aforesaid, Distributor shall bear full responsibility for
any harm caused to the Company by disclosure to Representatives.

6. Upon the Company’s first demand, Distributor shall return to the Company all Proprietary
Information, including all records, products and samples received, and any copies thereof, as well
as any notes, memoranda or other writings or documentation which contain or pertain to the
Proprietary Information or any portion thereof, whether in its possession or under its control, and
shall erase all electronic records thereof, an shall so confirm to the Company in writing.

7. Distributor recognizes, acknowledges and agrees that the Company may be irreparably harmed if
the Distributor’s obligations and undertakings herein are not specifically enforced and that the
Company would not have an adequate remedy at law in the event of actual or threatened violation by
the Distributor of such obligations and undertakings. Therefore, the Distributor agrees that the
Company shall be entitled to seek and obtain an injunction, without bond, or to an appropriate
decree of specific performance or any other appropriate equitable relief.

8. The Distributor recognizes that Company will receive confidential or Proprietary Information
from third parties subject to a duty on Company’s part to maintain the confidentiality of such
information and to use it only for certain limited purposes. At all times, both during the term of
this Agreement and after its termination, the Distributor undertakes to keep all such information
in strict confidence and trust, and not to use or disclose any of such information without the
prior written consent of Company, except as may be necessary to perform his duties under the
Distribution Agreement and consistent with Company’s agreement with such third party. Upon
termination of the Distribution Agreement, the Distributor shall act with respect to such
information as set forth in Section 6, mutatis mutandis.

9. The Distributor agrees and declares that all Proprietary Information, patents and other rights
in connection therewith shall be the sole property of Company and its assigns.

10. All of the Company’s rights hereunder and all of the Distributor’s obligations and undertakings
hereunder shall be in full effect for the entire term of this Agreement, and for an unlimited
period of time after its termination, cancellation or expiration for any reason whatsoever.

11. The provisions of Section 15 of the Distribution Agreement shall apply to this Agreement,
mutatis mutandis.

	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 
	TopSpin Medical (Israel) Ltd.	 	TOP Medical B.V.	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	 	 	By:
	 	 	 	 
	 

	 	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Title:

	 	 	 	Title:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 

11exv10w5

 

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CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

Exhibit 10.5

Research and Development Agreement 

This Research and Development Agreement (this “Agreement”), effective as of September 13, 2006
(the “Effective Date”), is entered into by and between TopSpin Medical Inc. a Delaware corporation
(“TopSpin”) for itself and/or at TopSpin’s election, TopSpin Medical (Israel) Ltd., a wholly owned
subsidiary of TopSpin, an Israeli corporation of 2 Yodfat St. Global Park, Lod (“TopSpin Israel”)
and/or TopSpin Urology Ltd. a wholly owned subsidiary of TopSpin, an Israeli corporation of 2
Yodfat St. Global Park, Lod (“TopSpin Urology”) (TopSpin and/or TopSpin Israel and/or TopSpin
Urology shall be referred to herein as the “Company”), Technion Research & Development Foundation
Ltd., an Israeli corporation of the Technion City, Haifa 32000 (“TRDF”) and Dr. Aharon Blank I.D.
No.029099330 of Naaman 24, Kefar Veradim (“Investigator”).

			
	WHEREAS,	 	the Investigator is currently engaged by TopSpin Israel and was
previously engaged by the TopSpin Israel as a full time and later
a part time employee, and during his employment with TopSpin
Israel developed for the Company certain Intellectual Property
(as defined) fully owned by the Company; and

			
	WHEREAS,	 	the Investigator is engaged at the Department of Chemistry of the
Technion — Israel Institute of Technology (the “Technion”); and

			
	WHEREAS,	 	TRDF is fully owned subsidiary of the Technion, and is authorized
to provide research and development services through the
personnel of the Technion; and

			
	WHEREAS,	 	the Investigator has the scientific skills and know-how in the
field of MRI physics which part of it was developed during his
employment in the Technion and therefore owned by TRDF (the
“Technion Existing IP”); and

			
	WHEREAS,	 	the Company is interested in performing research, development and
design work of a prototype of a system for MR imaging of the
prostate, which is intended for prostate cancer diagnosis, or of
other medical applications of the MR imaging, including in other
parts of the human body (the “Research Objective”); and

			
	WHEREAS,	 	TRDF is willing to perform the said research and it has agreed to perform the Research (as
defined hereunder) all subject to the terms and conditions of this Agreement; and
	 	 	 
	WHEREAS	 	The Company wishes TRDF, through the Investigator, to perform the Research for it in
accordance with the Research Protocol (as defined hereunder) and the budget that is attached
to this Agreement as Exhibit A (hereinafter the “Research Budget”), for the Research
Objective, all subject to the terms and conditions of this Agreement; and

			
	WHEREAS,	 	the Investigator has accepted to perform the Research on behalf of TRDF.

NOW, THEREFORE, the parties hereby agree as follows:

 

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- 2 -

	1.	 	Interpretation 
	 
	 	 	The preamble of this Agreement consists an integral part hereof. The headings of
the sections and subsections of this Agreement are for convenience of reference only
and are not to be considered in construing this Agreement.
	 
	2.	 	The Services

	 	2.1.	 	The Company appoints TRDF and the Investigator, and each of TRDF and the
Investigator undertakes, to perform for the Company the research detailed in the
research protocol attached in Exhibit A hereto (the “Research” and the
“Protocol”, respectively).
	 
	 	2.2.	 	Subject to timely payment of any payment specified in the Research Budget and
the performance of all the Company’s obligations pursuant to this Agreement,
implementation of the Research will commence on September 13, 2006, and will end at the
latest on September 12, 2007, as stated in this Agreement (hereinafter: the “Research
Period”).
	 
	 	2.3.	 	The Research shall be conducted by the Investigator and his research team at
the Investigator’s laboratory at the Department of Chemistry of the Technion.
	 
	 	2.4.	 	TRDF and the Investigator shall obtain or procure all the necessary approvals
and consents required in order to perform the Research. In addition, at all times TRDF
and the Investigator shall comply with any applicable laws, the provisions of the
Protocol and the Company’s written instructions (so long as the Investigator and TRDF
approves them), as provided from time to time in connection with the Research.
	 
	 	2.5.	 	The Research will be conducted in order to meet the milestones detailed in the
Protocol within the timeframe set forth therein, as the same may be amended from time
to time by the mutual written agreement of the parties. TRDF and Investigator will use
their best efforts to conduct the Research pursuant to its terms, including, without
limitation, to meet the research and development milestones set forth in the Protocol,
at the time indicated therein. TRDF and Investigator shall be solely and fully
responsible for the conduct of the Research, subject to the Company’s obligations
detailed in this Agreement. For the avoidance of doubt, and without derogation from
TRDF and Investigator’s obligation to use their best effort in order to successfully
achieve the milestones detailed in the Protocol, it is hereby clarified that neither
TRDF nor Investigator undertake that such milestones will be successfully achieved.
	 
	 	2.6.	 	The Company or TRDF may request to amend the Protocol or the Specifications.
Such request shall not be unreasonably withheld and shall require the Company or TRDF
and the Investigator advance approval which shall be evidenced with written document
signed by the parties.
	 
	 	2.7.	 	The parties shall meet regularly, but not less than every month to review the
progress of the Research. At the end of each stage of the work detailed in the Protocol
and preformed thereunder, and no less often than every thirty (30) days, and the
Investigator shall provide reports to the Company describing the progress of the
Research. A quarterly written report setting forth the status of the Research,
including other accomplishments and significant research findings shall be prepared by
the Investigator and submitted to the Company within thirty (30) days of the end of
each calendar quarter. In addition, at any time during the Research Period, after

 

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- 3 -

	 	 	 	reasonable advance notification to Investigator and his consent, the representatives
of the Company may visit Investigator’s laboratory in order to inspect the conduct of
the Research.

	 	2.8.	 	Investigator shall be responsible to ensure that any and all information
relating to or resulting from the conduct of the Research, including, without
limitation, any information relating to the Joint IP (as defined hereunder), are fully
and clearly documented in all Research reports (pursuant to Section 2.7), in an
academic format. (the “Documentation”).
	 
	 	2.9.	 	Upon commencement of the Research, the Company shall make certain equipment, as
listed in Exhibit A (the “Equipment”) available to TRDF for the purposes of conducting
the Research, at TRDF premises. TRDF shall keep such Equipment, at all times,
segregated and clearly marked as Equipment of the Company. TRDF shall be responsible
that such Equipment is used and maintained by it with the highest degree of care and
shall be liable for any damage to such equipment, except for customary wear and tear.
Upon the completion of the Research, as indicated specifically in Exhibit B part of
this Equipment will be formally transferred to TRDF’s ownership and TRDF shall become
the lawful owner of such equipment.

	3.	 	Representations

	 	3.1.	 	Each party expressly warrants to each other that neither the execution and
delivery of this Agreement nor the performance by it of the terms hereof, will conflict
with, or result in a breach or violation of, any of the terms, conditions and
provisions of: (i) with respect to any legal entity — any of its corporate documents,
(ii) any judgment, order, injunction, decree, or ruling of any court or governmental
authority, domestic or foreign, to which it is subject, (iii) any agreement, contract,
lease, license or commitment to which it is party or to which it is subject, or (iv)
applicable laws; It has the full power and authority to execute and deliver this
Agreement and to consummate the transactions contemplated hereby, and the execution and
delivery of this Agreement have been authorized by all necessary corporate action. This
Agreement constitutes it valid and binding obligation and subject to all applicable
laws — it is enforceable against them in accordance with its respective terms.
	 
	 	3.2.	 	In addition, TRDF and Investigator represent that they have all necessary
facilities necessary to conduct the Research and it will be rendered in a competent and
professional manner and standards.

	4.	 	Consideration

	 	4.1.	 	In consideration for the Research provided hereunder, and subject to the
performance of all the obligations of TRDF and the Investigator hereunder, the Company
shall pay TRDF the cash consideration stated in the budget attached in Exhibit
A hereto (the “Research Budget”), in accordance with the payment schedule detailed
therein.
	 
	 	 	 	TRDF and the Investigator’s obligations as set in this Agreement — are subject to
Company timely fulfilling its payment obligations as payments set forth in Exhibit A
including changes thereto, if mutually agreed in writing.

 

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	 	 	 	Unless otherwise expressly stated in Exhibit A, any payment due by Company shall be
paid within thirty (30) days from the date of the issuance of TRDF’s invoice to the
Company.
	 
	 	4.2.	 	In addition, TRDF and the Investigator jointly, shall be entitled to
participate in the 2003 Stock Option Plan (the “Plan”) adopted by TopSpin, subject to
the following terms and conditions:

	 	4.2.1.	 	TRDF and the Investigator shall receive unregistered options to purchase up to
1,200,000 (One Million two hundred thousands) shares of Common Stock of TopSpin
(the “Options”), at an exercise price to be calculated as the average value of
TopSpin’s stock traded in the Tel Aviv Stock Exchange, over a thirty (30)
trading day period preceding the Effective Date . The Options shall be divided
equally between TRDF and the Investigator.
	 
	 	4.2.2.	 	The Option will be granted under Section 3(i) of the Tax Ordinance, and
subject to the provisions of the Plan. In addition, the grant of Options is
subject to execution by TRDF and/or the Investigator of option grant agreement
with TopSpin in the form attached hereto as Exhibit 4.2.2 (the “Option
Agreement”). The Plan is attached as Exhibit 4.2.2.A to the Agreement.
	 
	 	4.2.3.	 	The Options shall vest pursuant to the following vesting schedule:

	 	4.2.3.1.	 	300,000 Options shall be vested, 12 months from the commencement
of the Research (the “Commencement Date”); and, in addition
	 
	 	4.2.3.2.	 	300,000 Options shall be vested 24 months from the Commencement
Date, provided, however, that the Research was successfully
completed and the specifications detailed in Exhibit A
hereto were successfully achieved within 12 months of the
Commencement Date; Any dispute between the parties in connection
with the decision whether or not all specifications detailed in
Exhibit A were successfully achieved shall be brought before
a single academic arbitrator which shall be appointed together by
the CEO of the Company and the manager of TRDF and the provisions of
Section 10.2 herein shall apply mutatis mutandis. The decision of
the arbitrator shall be final, not subject to appeal and subject to
all applicable laws; and, in addition,
	 
	 	4.2.3.3.	 	(a) If the conditions detailed in Section 4.2.3.2 above were met
(i.e. in the event the Research was successfully completed and the
specifications set forth in Exhibit A were achieved within
12 months of the Commencement Date), 300,000 Options shall be vested
immediately after the Company shall obtain FDA approval to market a
product based on the results of the Research for prostate cancer
diagnosis;
	 
	 		 	(b) In the event the conditions detailed in Section 4.2.3.2
above were not fully met yet the Company (or any third party
licensee of the Company that was granted a license

 

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	 	 	 	from the Company for the development of a product in the
cancer diagnosis field) has obtained an FDA approval to
market a product which is based on the results of the
Research, 150,000 Options shall be vested immediately after
such approval is issued by the FDA;
	 
	 	 	 	     and, in addition,

	 	4.2.3.4.	 	(a) If the conditions detailed in Section 4.2.3.2 above were met
(i.e. in the event the Research was successfully completed and the
specifications set forth in Exhibit A were achieved within 12 months
of the Commencement Date), 300,000 Options shall be vested
immediately after the Company shall obtain FDA approval to market
the first product developed by the Company or by third party
licensees of the Company, granted a license from the Company for the
development of such product, solely in the event such product is
based on the results of the Research for any medical application
other than prostate cancer diagnosis.
	 
	 	 	 	(b) In the event the conditions detailed in Section 4.2.3.2
above were not fully met yet the Company (or any third party
licensee of the Company that was granted a license from the
Company for the development of a product for any medical
application other than prostate cancer diagnosis) has obtained
an FDA approval to market a product which is based on the
results of the Research for any medical application other than
prostate cancer diagnosis – 150,000 Options shall be vested
immediately after such approval is issued by the FDA;
	 
	 	4.2.3.5.	 	For the avoidance of doubt, nothing in this Agreement shall
impose any obligation on the Company to develop any product in the
prostate cancer diagnosis field or any other field or to file any
request or application with the FDA with regard to any such
products.

	 	4.2.4.	 	The Options are non-transferable, unless otherwise agreed by both parties in
writing.
	 
	 	4.2.5.	 	Vested options will be exercisable for a period of 10 years from the Effective
Date, subject to earlier termination or expiration in accordance with Section 14
of the Plan.
	 
	 	4.2.6.	 	TRDF and the Investigator, as the case may be, will be solely liable for any
tax consequences resulting from the grant of the Options.
	 
	 	4.2.7.	 	The grant of Option is conditioned upon the approval of the Tel Aviv Stock
Exchange of the registration to trade of the shares of common stock of TopSpin
into which the Options are exercisable (the “Shares”).
	 
	 	4.2.8.	 	The issuance of the Options and the Shares, their holding and transfer, are
subject to the provisions of the Plan and the Option Agreement and

 

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	 	 	 	any applicable law, including lock up periods imposed pursuant the
provisions of the Securities Law, 1968.

	5.	 	Intellectual Property Rights

	 	5.1.	 	Each party hereto shall continue to be the sole owner of any and all
intellectual property rights, including without limitation patents, patent
applications, any copyrights and registrations and applications for registration
thereof, computer software, programs, data and documentation, technology, trade secrets
and confidential business information, whether patentable or non-patentable and whether
or not reduced to practice, know-how, designs, prototypes, laboratory protocols,
enhancements, improvements, works-in-progress, research and development information,
and other proprietary rights relating to any of the foregoing (including without
limitation remedies against infringements thereof and rights of protection of an
interest therein under the laws of all jurisdictions) (“Intellectual Property Rights”),
including without limitation TRDF sole ownership in and to the Technion Existing IP
owned by it prior to the date hereof and/or generated by it or any of the TRDF
personnel outside the scope of the Research and/or the Research Objective including by
the Investigator and any of the members of his research team in the Technion.
	 
	 	 	 	It is hereby clarified that the Research related Intellectual Property Rights owned
by TRDF and generated by the Investigator and any of the members of his research team
in the Technion include, without limitation, as detailed in Exhibit B(1). The
Research related Intellectual Property Rights owned by the Company include, without
limitation, the rights as detailed in Exhibit B(2). In addition, it is agreed
that any disclosure of such Intellectual Property Rights by one of the parties hereto
to another party shall be subject to the provisions of Section 7 hereto and shall not
derogate from the disclosing party’s rights in such Intellectual Property Rights.
	 
	 	5.2.	 	Any and all title, interest and right, of any type or nature whatsoever, in any
Intellectual Property Rights which shall be made, conceived or created by the
Investigator or other participants in the Research on behalf of TRDF or the Technion
(collectively, the “Personnel”), during the conduct of the Research and for the
Research Objective is and shall be the joint property of TRDF and the Company (the
“Joint IP”).
	 
	 	5.3.	 	Subject to the Company complying with all obligations set in this Agreement and
during the Term of this Agreement and thereafter, the Company may use the Joint IP for
all intents and purposes whatsoever, without limitation, and may freely transfer or
grant right to third parties with respect to all or part of such Joint IP, without any
obligation to TRDF, except as stated in this section. TRDF and the Investigator may use
the Joint IP Rights solely for (1) internal purpose of academic research to be
conducted by TRDF, the Investigator or the Technion; (2) for any research and
development to be conducted by TRDF, the Investigator or the Technion for any
applications other than medical applications for MR imaging – such use will be free of
any limitation and TRDF may transfer or grant any third party any rights therewith,
provided however, that TRDF shall be responsible for any such transfer or assignment
and the effect and consequences of any such transfer or assignment to any such third
party.

 

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	 	5.4	 	The Company is hereby granted an irrevocable, transferable, royalty free
license only to use the Technion Existing IP which was generated by the Investigator,
as listed in Exhibit C(1), during and after the Term of this Agreement, for any use
whatsoever, provided that such use is made together with the use of the Joint IP or any
part thereof.
	 
	 	5.5.	 	TRDF undertakes that it, the Investigator and all other Personnel will promptly
disclose to the Company in confidence all Joint IP and agrees to reasonably assist the
Company, at the Company’s expense, in proper way to obtain for the Company patents,
copyrights, mask work rights, and other legal protections for the Joint IP in any and
all countries. TRDF, the Investigator and any other Personnel will execute any
documents that the Company may reasonably request for use in obtaining or enforcing
such patents, copyrights, mask work rights, trade secrets and other legal protections.

	6.	 	[Omitted]
	 
	7.	 	Confidential Information
	 
	 	 	The Company shall preserve the confidentiality and secrecy of the non-public information
received from TRDF in connection with its services. TRDF undertakes that it and any
Personnel shall preserve the confidentiality and secrecy of the non-public information
received from the Company in connection with its services hereunder, in accordance with the
provisions of the Mutual Non Disclosure Agreement (“NDA”) attached as Exhibit 7 to
this Agreement. The parties will sign the NDA simultaneously with the execution of this
Agreement.
	 
	8.	 	Publications 
	 
	 	 	Without derogation from the provisions of Section 7 of this Agreement, neither TRDF nor the
Investigator or any other Personnel shall have the right to make any publication of any
material, including but not limited to articles and papers, that incorporate information
which is the results of the Research or the Company’s confidential information, including
any publication relating to the Joint IP which can effect the legal protections for such
Joint IP, unless such publication is approved by the Company in advance and in writing, in
its sole discretion. A notice of the interest of TRDF, the Investigator or other Personnel
to publish accompanied by the know-how contained in the publication, shall be sent to the
Company in advance. The Company may, within 45 days, give notice that it objects to the
publication, by way of a reasoned notice setting forth reasonable grounds.
	 
	 	 	In no event shall the Company be entitled to delay publication for a period which
exceeds one hundred and thirty five (135) days from the date of the notice given to the
Company.
	 
	 	 	This section with regard to confidentiality and restriction of publication as aforesaid
shall not apply with respect to information and/or results of the Research which, at the
time of publication (i) was part of the public domain and not resulting from a breach of the
obligation for confidentiality, or (ii) with respect to Technion Existing Information, was
in TRDF’s possession, prior to the Research as can be shown by documentary evidence, or
(iii) was independently developed by TRDF, the Investigator and/or the Personnel outside the
scope of the Research, or (iv) was received by TRDF, the Investigator and/or the Personnel
by third party other than the Company not bound by any confidentiality undertakings.

 

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	9.	 	Term and Termination

	 	9.1.	 	The term of this Agreement shall be for the longer period between (1) a period
of one year from the date hereof or (2) the period for which the Company has completed
all of its obligation towards TRDF and the Investigator, including without limitation
the term in which all Option as set in Section 4.2 have been granted, to the extent
applicable (the “Term”). The parties may decide to extend the Term for additional 12
months period, and to expand the Research, in terms and conditions as shall be mutually
agreed between the parties.
	 
	 	9.2.	 	This Agreement may be terminated as follows:

	 	9.2.1.	 	By consent in writing of TRDF and the Company.
	 
	 	9.2.2.	 	At the election of either TRDF and the Company, if there has been a material
violation or breach by the other party of any material covenant or agreement
contained herein, which violation or breach shall not have been cured or
corrected by the violating or breaching party within thirty (30) days after
receipt of notice thereof, describing such violation or breach in reasonable
detail or such longer period as may be agreed between the parties.

	 	9.3.	 	Upon termination of this Agreement for any reason, TRDF and any Personnel shall
cease all work and shall promptly provide the Company, without additional cost to the
Company, all work and materials developed by TRDF under this Agreement. TRDF shall also
return to the Company all materials and Confidential Information provided by the
Company in connection with this Agreement.

	 	9.4.	 	Notwithstanding anything else to the contrary herein, the provisions of
Sections 4 5, 7, 8, and 9 of this Agreement shall survive the termination of this
Agreement.

	10.	 	Miscellaneous

	 	10.1.	 	This Agreement shall be subject to the laws of the State of Israel, without
regard to the conflict of laws provisions thereof.
	 
	 	10.2.	 	All disputes arising out of or in connection with this Agreement shall be
finally settled under the Israeli Law of Arbitration by one arbitrator appointed by the
parties in consent, and, absent consent within 30 days of demand in writing, by the
Chief Judge of the Tel Aviv District Court, in accordance with the said Law, as
follows: (i) the place of arbitration shall be Tel Aviv; (ii) the language to be used
in the arbitral proceedings shall be Hebrew; (iii) the arbitrator shall be free of the
rules of procedure or evidence, but shall be subject to the substantive law and shall
give only reasoned opinions in writing; (iv) the award rendered by the arbitrator shall
be in writing and shall be final and binding upon the parties to the arbitration;
judgment upon the award of the arbitrator may be entered in any court having
jurisdiction thereof or such court may be asked to judicially confirm the award and
order its enforcement, as the case may be; (v) the arbitrator may consult with such
experts as arbitrator shall see fit under the applicable rules; and (vi) this section
shall be deemed to constitute an arbitration agreement between the parties, if and to
the extent required under applicable law.
	 
	 	10.3.	 	Each party will bear its own costs in connection with the transactions
contemplated hereunder, including attorney’s fees and expenses.

 

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	 	10.4.	 	Each party has reviewed with its own tax advisors the federal, state, local
and foreign tax consequences of the transactions contemplated by this Agreement. Each
party is relying solely on such advisors and not on any statements or representations
of the other party or any of its agents. Each party understands that it shall be
responsible for any tax liability that may imposed on it under applicable law as a
result of the transactions contemplated by this Agreement.
	 
	 	10.5.	 	Subject to the terms and conditions of this Agreement, each party will use its
commercially reasonable efforts to take, or cause to be taken, all actions and to do,
or cause to be done, all things necessary or desirable under applicable laws and
regulations to consummate the transactions contemplated by this Agreement. Each party
agrees to execute and deliver such other documents, certificates, agreements and other
writings and to take such other actions as may be necessary or desirable in order to
consummate or implement expeditiously the transactions contemplated by this Agreement.
	 
	 	10.6.	 	This Agreement constitutes the entire agreement between the parties with
respect to its subject matter and supersedes all prior agreements or understandings
between the parties relating to its subject matter.
	 
	 	10.7.	 	This Agreement may be amended, supplemented, or otherwise modified only by
means of a written instrument signed all parties hereto. Any waiver of any rights or
failure to act in a specific instance shall relate only to such instance and shall not
be construed as an agreement to waive any rights or fail to act in any other instance,
whether or not similar.
	 
	 	10.8.	 	In the event that any provision of this Agreement shall be held invalid or
unenforceable for any reason, such invalidity or unenforceability shall not affect any
other provision of this Agreement, and the parties shall negotiate in good faith to
modify the Agreement to preserve (to the extent possible) their original intent.
	 
	 	10.9.	 	Nothing contained herein shall be deemed or construed to create between the
parties hereto a partnership or joint venture. No party shall have the authority to act
on behalf of any other party, or to commit any other party in any manner or cause
whatsoever or to use any other party’s name in any way not specifically authorized by
this Agreement. No party shall be liable for any act, omission, representation,
obligation or debt of any other party, even if informed of such act, omission,
representation, obligation or debt.
	 
	 	10.10.	 	This Agreement cannot be assigned by TRDF or Investigator. The Company shall have the
right to assign its rights, duties and obligations under this Agreement to any
successor entity (acquirer of the Company or any part of its assets, or a company into
which the Company shall have been merged). In any event, an assignment will be
permitted only after (1) giving an advance written notice of 45 days to TRDF and the
Investigator and; (2) only after the assignee agrees in writing, in a document
addressed to TRDF and the Investigator, to be bound by all the terms and conditions of
this Agreement. Notwithstanding the aforesaid, the Company may, by written notice to
TRDF and the Investigator, assign its rights, duties and obligations hereunder to any
affiliate of the Company, provided however, that the Options granted hereunder may not
be assigned or exchanged into securities of any Company affiliate, without the prior
written consent of TRDF and the Investigator, which consent will not be unreasonably
withheld.
	 
	 	10.11.	 	All remedies, either under this Agreement or by law or otherwise afforded to any of
the Parties, shall be cumulative and not alternative.

 

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	 	10.12.	 	This Agreement may be executed in any number of counterparts, each of which shall be
deemed an original and enforceable against the Parties actually executing such
counterpart, and all of which together shall constitute one and the same instrument.
	 
	 	10.13.	 	Any offer, notice, response or other communication required or authorized to be given
by any Party under this Agreement to the other Party shall be in writing and shall be
personally delivered, sent by facsimile transmission (with a copy by ordinary mail in
either case) or dispatched by courier addressed to the other party at the address
stated below or such other address as shall be specified by the parties hereto by
notice in accordance with the provisions of this Section. Any notice shall operate and
be deemed to have been served, if personally delivered or sent by fax on the next
following business day, and if by courier, on the fifth following business day.
Addresses for the purposes of this Section are as follows:

	 	 	 	 
	To TRDF:

	 	The Technology Transfer Office	 
	 

	 	Technion R&D Foundation Ltd
	 

	 	Technion city, Haifa 32000, Israel
	 
	 	 
	To Investigator:
	 	 
	 

	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	To the Company:

	 	2 Yodfat St. Global Park, Lod
	 

	 	Fax: 972-8-9281233
	 

	 	Attn: Mr. Eyal Kolka, CFO & Senior VP of Bus. Dev.
	 
	 	 
	 

	 	with a copy to (which shall not constitute service of
process on):
	 
	 	 
	 

	 	Ori Rosen & Co., Law Offices
	 

	 	1 Azrieli Center, Tel Aviv 67021, Israel
	 

	 	Fax: 972-3-6074701
	 

	 	Attn: Mr. Ori Rosen, Adv.

 

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IN WITNESS WHEREOF the parties have signed this Agreement as of the date hereinabove set forth.

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 

	 
	TopSpin Medical Inc.	 	Technion Research & Development
Foundation Ltd.	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	 	 	By:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 
	Title:

	 	 	 	Title:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	Dr. Aharon Blank
	 	 	 	 	 	 

Exhibit A – Protocol, Research Budget and Equipment

Exhibit B(1)
– Research related Intellectual Property Rights owned by TRDF and generated by the Investigator

Exhibit B(2) – Research related Intellectual Property Rights owned by the Company IP

 

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Exhibit A

Specifications ,Work plan and Budget

     1. Specifications

****

     2. Work plan

****

     3. Budget

     The following table represents the budget allocation for the activities at the Technion only
and for the equipment/supplies purchased by the Technion. The budget allocation should be flexible
and enable the team leader at the Technion (AB) complete flexibility in deciding about the exact
nature of expenditure during the project progress.

****

     4. Gantt chart

****

1

 

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REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

Exhibit B1

Technion Existing IP (Dr Aharon Blank)

*****

 

 

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Exhibit B2

TopSpin Medical (Israel) Ltd. — list of applications and Patents

*****

 

 

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Option Agreement

This option agreement (“Agreement”) is effective as of September 13, 2006 (the “Date of Grant”), by
and between Technion Research & Development Foundation Ltd. (“Optionee”) and Topspin Medical, Inc.
(the “Corporation”).

Under the Topspin Medical Inc. 2003 Israeli Stock Option Plan (“Plan”) (a copy of which is attached
hereto as Exhibit A), the Corporation hereby grants to the Optionee options to purchase such number
of shares of Common Stock of the Corporation par value US$0.001 each as set forth below (“Options”)
pursuant and subject to the terms and provisions set forth in the Plan and as provided herein.

All capitalized terms not otherwise defined herein shall have the meaning ascribed to them in the
Plan.

Notwithstanding any other provision of this Agreement or the Plan, it is hereby clarified that the
grant of Option pursuant to this Agreement is conditioned upon the approval of the Tel Aviv Stock
Exchange of the registration to trade of the shares of common stock of TopSpin into which the
Options are exercisable (the “Shares”), and the provisions of this Agreement and the Grant of Stock
to the Optionee will be entered into force and effect only after the Corporation provides Optionee
with written notice that the Tel Aviv Stock Exchange approved the registration to trade of the
Shares. If such approval will not be obtained until 60 days after the Date of Grant, this Agreement
shall become null and void, and Optionee shall have no claim against the Corporation, its
affiliates or any of their directors, officers and shareholders with respect to the Options or the
underlying Shares. Notwithstanding the aforesaid, in the event the Options granted hereunder will
not be granted since the required approval from the Tel Aviv Stock Exchange is not obtained,
Optionee will be compensated by the Corporation with cash compensation on such dates the Options
detailed hereunder should be vested, on the basis of the value of the Options granted hereunder, as
shall be mutually agreed by the parties hereto in good faith.

	1.	 	Terms and Conditions of Options

	 	 	 
	Number of Options :
	 	600,000
	 
	 	 
	 
	 	Each Option shall be exercisable for one (1) share of Common Stock of the Corporation par value  US$0.001 each.
	 
	 	 
	Exercise Price:
	 	US$0.1114 per share.
	 
	 	 
	Type of Options:
	 	o Approved 102 Options:
	 
	 	     o Capital Gain Options (CGO);
	 
	 	     o Ordinary Income Options (OIO)
	 
	 	o Unapproved 102 Options
	 
	 	þ 3(9) Options

 

 

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	Vesting Schedule:

	 	1.    150,000 Options shall vest 12 months from the
commencement of the research (the “Commencement
Date”) under the Research and Development Agreement
by and among the Corporation, the Optionee and Dr.
Aharon Blank, dated as of September 13, 2006 (the
“R&D Agreement”).

	 
	 

	 	2.    150,000 Options shall vest 24 months from the
Commencement Date, provided however, that the
research under the R&D Agreement was successfully
completed in accordance with all the terms and
conditions detailed the R&D Agreement (“Successful
Completion”).

	 
	 

	 	3.   In the event of Successful Completion, 150,000
Options shall vest immediately after the Corporation,
including through its fully owned subsidiaries,
TopSpin Urology Ltd. and/or TopSpin Medical (Israel)
Ltd. (the “Subsidiaries”) shall obtain FDA approval
to market a product based on the results of the
research under the R&D Agreement for prostate cancer
diagnosis as detailed in the R&D Agreement.

	 
	 

	 	      In the event Successful Completion was not achieved
yet the Corporation (or any third party licensee of
the Corporation that was granted a license from the
Corporation for the development of a product in the
cancer diagnosis field) has obtained an FDA approval
to market a product which is based on the results of
the Research, 75,000 Options shall be vested
immediately after such approval is issued by the FDA

	 
	 

	 	4.   In the event of Successful Completion, 150,000
Options shall vest immediately after the Corporation,
including through the Subsidiaries, shall obtain FDA
approval to market the first product developed in
accordance with the provisions of Section 4.2.3.4 of
the R&D Agreement, for any medical application other
than prostate cancer diagnosis.

	 

	 	       In the event Successful Completion was not achieved
yet the Corporation (or any third party licensee of
the Corporation that was granted a license from the
Corporation for the development of a product for any
medical application other than prostate cancer
diagnosis) has obtained an FDA approval to market a
product which is based on the

 

 

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REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

	 	 	 
	 

	 	        results of the Research
for any medical application other than prostate
cancer diagnosis – 75,000 Options shall be vested
immediately after such approval is issued by the FDA

	2.	 	Exercise of Options
	 
	 	 	The exercise of the Options shall be by delivery by the Optionee to the Corporation at its
principle executive office of a written notice of exercise in the form attached hereto as
Exhibit B, specifying inter alia the number of shares of Stock to be purchased and
accompanied by the payment of the Exercise Price.
	 
	 	 	Options may be exercised only to purchase whole shares of Stock (the “Shares”), and in no
case may a fraction of a Share be purchased. If any fractional Share would be deliverable
upon exercise, such fraction shall be rounded up one-half or less, or otherwise rounded
down, to the nearest whole number.
	 
	 	 	The Corporation shall not be obligated to issue any Shares upon the exercise of an Option
if such issuance, in the opinion of the Corporation, might constitute a violation by the
Corporation of any provision of law.
	 
	3.	 	Other Provisions

	 	3.1	 	All other terms and conditions, including terms and conditions of
expiration and termination of the Options, voting rights and adjustments, which are
set forth in the Plan, shall apply to the Options. For the avoidance of doubt, the
provisions of Sections 7.6, 7.7 and 7.8 shall not apply to the Options.
	 
	 	 	 	Notwithstanding any other provision of this Agreement or the Plan, it is hereby
clarified the issuance of the Options and the Shares, their holding and transfer,
are subject to the provisions of any applicable law, including, without
limitation, the lock up periods imposed pursuant the provisions of the Securities
Law, 1968.
	 
	 	3.2	 	Optionee acknowledges receipt of a copy of the Plan and represents that he
or she is familiar with the terms and provisions thereof, and hereby accepts this
Agreement subject to all of the terms and provisions thereof. Optionee has reviewed
the Plan and this Agreement in their entirety, has had an opportunity to obtain the
advice of counsel prior to executing this Agreement and fully understands all
provisions of the Agreement, the provisions of Section 3(9) of the Israeli Income Tax
Ordinance [New Version] 1961 as amended and all rules, regulations and orders
promulgated thereunder and the tax route applicable to the Options granted to
him/her.
	 
	 	3.3	 	Optionee hereby agrees to accept as binding, conclusive and final all
decisions or interpretations of the Board or the Committee upon any question arising
under the Plan or this Agreement. Optionee further

 

 

PORTIONS OF THIS EXHIBIT IDENTIFIED BY “****” HAVE BEEN DELETED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

	 	 	 	agrees to notify the Corporation upon any change in the residence address
indicated below.
	 
	 	3.4	 	Omitted.
	 
	 	3.5	 	The Optionee shall regard the information in this Agreement and its
exhibits attached hereto as confidential information and the Optionee shall not
reveal their contents to anyone except when required by law or for the purpose of
gaining legal or tax advice.
	 
	 	3.6	 	Subject to the provisions of the Plan, to which this Agreement is subject,
this Agreement, together with the exhibits hereto, constitute the entire agreement
between the Optionee and the Corporation with respect to Options granted hereunder,
and supersedes all prior agreements, understandings and arrangements, oral or
written, between the Optionee and the Corporation with respect to the subject matter
hereof.
	 
	 	3.7	 	The Options provided for herein are granted pursuant to the Plan and said
Options and this Agreement are in all respects governed by the Plan and subject to
all of the terms and provisions of the Plan. Any interpretation of this Agreement
will be made in accordance with the Plan. In the event there is any contradiction
between the provisions of this Agreement and the Plan, the provisions of the Plan
will prevail.
	 
	 	3.8	 	The Plan and this Agreement shall be binding upon the heirs, executors,
administrators and successors of the parties hereof.
	 
	 	3.9	 	All notices or other communications given or made hereunder shall be in
writing and shall be delivered or mailed by registered mail or delivered by email or
facsimile with written confirmation of receipt to the Optionee and/or to the
Corporation at the addresses shown below, or at such other place as the Corporation
may designate by written notice to the Optionee.

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the date first above
written.

	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 	 	 	 	 
	 

	 	Optionee
	 	 	 	Topspin Medical, Inc.
	 	 
	 

	 	By:
	 	 	 	By:	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Address:	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 

	 	 	 	 	 	 

 

 

PORTIONS OF THIS EXHIBIT IDENTIFIED BY “****” HAVE BEEN DELETED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

Exhibit A

The Plan

 

 

PORTIONS OF THIS EXHIBIT IDENTIFIED BY “****” HAVE BEEN DELETED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

Exhibit B

Notice of Exercise

Exercise of Option The undersigned (the “Optionee”) hereby elects to exercise Optionee’s
Option to purchase                                 shares of Common Stock par value US$ 0.001 each of TopSpin Medical,
Inc. (hereinafter the “Corporation” and the “Exercised Shares”) pursuant to the Topspin Medical,
Inc. 2003 Israeli Stock Option Plan (the “Plan”) and the Option Agreement dated                                         ,
(the “Option Agreement”).

All capitalized terms not otherwise defined herein shall have the meaning ascribed to them in the
Plan.

Delivery of Payment – Optionee herewith delivers to the Corporation the full Exercise Price
for the Exercised Shares, as set forth in the Option Agreement.

Representations of Optionee — Optionee acknowledges that Optionee has received, read and
understood the Plan, the Option Agreement and the trust agreements by and among the Corporation,
TopSpin Medical (Israel) Ltd. and the Trustee and agrees to abide by and be bound by their terms
and conditions. The Optionee further represents that in exercising the Option, the Optionee hereby
confirms and acknowledges that (i) the Exercised Shares are being acquired solely for the account
of the undersigned and not as a nominee for any other party, or for investment, and not with a view
to, or intention of, or otherwise for resale in connection with, any distribution; (ii) neither the
offer or sale of the Exercised Shares, nor the Exercised Shares themselves, have been registered
under the Securities Act of 1933, as amended, (the “Act”), or registered or qualified under the
applicable securities laws of any state or other jurisdiction, and that the Exercised Shares are
being sold to the Optionee by reason of and in reliance upon a specific exemption from the
registration provisions of the Act, and exemptions from registration or qualification provisions of
such applicable state or other jurisdiction securities laws which depend upon, among other things,
the bona fide nature of the investment intent as expressed herein and the truth and accuracy of the
representations and warranties of the Optionee set forth herein; and (iii) that the Optionee will
not offer, sell or otherwise dispose of the Exercised Shares except under circumstances that will
not result in a violation of the Act or any state securities laws and that the certificates
representing the Exercised Shares may bear a legend noting such restrictions.

Tax Consequences – Any tax consequences and/or future payment and/or costs arising from the
grant or exercise of any Option, from the payment for Shares covered thereby or from any other
event or act (of the Corporation and/or its Affiliates and the Trustee or the Optionee), hereunder,
shall be borne solely by the Optionee. The Corporation and/or its Affiliates, and/or the Trustee
shall withhold taxes according to the requirements under the applicable laws, rules, and
regulations, including the withholding of taxes at source. Furthermore, the Optionee shall agree to
indemnify the Corporation and/or its Affiliates and/or the Trustee and hold them harmless against
and from any and all liabilities for any such tax or interest or penalty thereon,

 

 

PORTIONS OF THIS EXHIBIT IDENTIFIED BY “****” HAVE BEEN DELETED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

including without limitation, liabilities relating to the necessity to withhold, or to have
withheld, any such tax from any payment made to the Optionee.

Submitted on                                          by

	 	 	 	 	 
	OPTIONEE

	 	 	 	 
	 
	 	 	 	 
	 	 	 
	Signature
	 	 	 	 
	 
	 	 	 	 
	 	 	 
	Print Name
	 	 	 	 
	 
	 	 	 	 
	Address:

	 	 	 	 
	 

	 	 	 	 

 

 

PORTIONS OF THIS EXHIBIT IDENTIFIED BY “****” HAVE BEEN DELETED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

Mutual Non Disclosure Agreement

This Mutual Non Disclosure Agreement (this “Agreement”) is entered by and among TopSpin
Medical, Inc., a company organized under the laws of Delaware, with its offices at 2 Yodfat
Street, Lod, Israel for itself and/or at TopSpin’s election, TopSpin Medical (Israel) Ltd., a
wholly owned subsidiary of TopSpin, an Israeli corporation of 2 Yodfat St. Global Park, Lod
(“TopSpin Israel”) and/or TopSpin Urology Ltd. a wholly owned subsidiary of TopSpin, an Israeli
corporation of 2 Yodfat St. Global Park, Lod (“TopSpin Urology”) (TopSpin and/or TopSpin Israel
and/or TopSpin Urology shall be referred to herein as the “Company”), Technion Research &
Development Foundation Ltd., an Israeli corporation of the Technion City, Haifa 32000 (“TRDF”) and
Dr. Aharon Blank I.D. No.029099330 of Naaman 24, Kefar Veradim (“Investigator”).

The Company, TRDF and the Investigator have executed a Research and Development Agreement to which
this Agreement is attached as Exhibit 7 (the “R&D Agreement”) for the conduct of the research
detialed therein, and in connection with the same each party hereto has been, and/or will be,
provided with, and/or has access to certain confidential information of the other party. With
respect to any and all information disclosed by either party (“Disclosing Party”) to the other
party (“Receiving Party”), the parties wish to ensure due protection of such information.

Therefore, the parties hereby agree as follows:

	1.	 	Receiving Party acknowledges that it may receive information regarding the activities and
business of Disclosing Party, its parent companies, subsidiaries and/or affiliates, all
whether in oral, written, graphic, or machine-readable form, or in any other form,
including, without limitation, concepts, techniques, processes, methods, systems, designs,
drawings, photographs, models, prototypes, computer programs, research materials, formulas,
development or experimental work, work in progress, mask work, inventions, cost data,
marketing plans, product plans, business strategies, financial information, forecasts,
personnel information and customer or supplier lists (collectively, “Confidential
Information”). For the avoidance of doubt, nothing herein shall be deemed to impose on
Disclosing Party any duty or obligation to disclose any such information to Receiving Party,
and such disclosure shall be at all times at Disclosing Party’s sole and absolute
discretion. Furthermore, nothing herein shall be deemed to create any representation that
the Confidential Information, or any part of it, is whole, accurate or correct.
	 
	2.	 	Notwithstanding the aforesaid, information shall not be deemed as Confidential
Information, for purposes of this Agreement, if Receiving Party can show documentary
evidence that: (a) such information is in the public domain at the time of disclosure, or
subsequently becomes part of the public domain, through no breach of Receiving Party of its
obligations hereunder; or (b) such information is received by Receiving Party from a third
party exempt from confidentiality undertakings; or (c) such information was in its
possession at the time of disclosure, and Receiving Party so advised Disclosing Party in
writing immediately upon disclosure; or (d) Receiving Party is compelled by court or
government action pursuant to applicable law to disclose such information, provided,
however, that Receiving Party gives Disclosing Party prompt notice thereof so that
Disclosing Party may seek a protective order or other appropriate remedy, and further
provided that in the event that such protective order or other

 

PORTIONS OF THIS EXHIBIT IDENTIFIED BY “****” HAVE BEEN DELETED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

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	 	 	remedy is not obtained, Receiving Party shall furnish only that portion of the Confidential
Information which is legally required, and shall exercise all efforts required to obtain
confidential treatment for such information.
	 
	3.	 	The Confidential Information shall be used by Receiving Party for the sole purpose of the
engagement of the parties under the R&D Agreement.
	 
	4.	 	Receiving Party hereby acknowledges that the Confidential Information is highly
confidential, and undertakes that, at all times, it: (i) shall treat and maintain the
Confidential Information as confidential, and hold all such Confidential Information in
trust and in strict confidence, utilizing the same degree of care it uses to protect its own
confidential information, but in no event less than a reasonable degree of care; (ii) shall
not disclose the Confidential Information to any third party, whether or not for
consideration; (iii) shall not use the Confidential Information for any purpose other than
the limited purpose mentioned in Section 3 above, or exploit the Confidential Information
for its own benefit or for the benefit of anyone else, without the prior written consent of
Disclosing Party; and (iv) shall not make any copies of the Confidential Information without
the prior written consent of Disclosing Party.
	 
	5.	 	Receiving Party undertakes to hold all Confidential Information locked and to disclose
the Confidential Information only to those of its employees and consultants (provided, with
respect to such consultants, that disclosure to any consultant shall be made only after
receipt of written consent of the Disclosing Party) (each, a “Representative”) who have to
be so informed in order to ensure its proper evaluation, and provided that such
Representatives are bound by written confidentiality and non-use undertakings towards
Receiving Party which also apply to the Confidential Information disclosed to Receiving
Party under this Agreement. Receiving Party will be responsible for ensuring that the
obligations of confidentiality and non-use contained herein are observed by all
Representatives, and it represents that it has instituted policies and procedures which
provide such adequate protection for the Confidential Information. Without derogating from
the aforesaid, Receiving Party shall bear full responsibility for any harm caused to
Disclosing Party by disclosure to Representatives.
	 
	6.	 	To the extent that any portion of the Confidential Information contains proprietary and
confidential notices or legends, Receiving Party shall not remove such notices or legends,
and shall produce the same on each and every copy of the Confidential Information produced
by it.
	 
	7.	 	Upon Disclosing Party’s first demand, Receiving Party shall return to Disclosing Party
all Confidential Information, including all records, products and samples received, and any
copies thereof, as well as any notes, memoranda or other writings or documentation which
contain or pertain to the Confidential Information or any portion thereof, whether in its
possession or under its control, and shall erase all electronic records thereof, an shall so
confirm to Disclosing Party in writing.
	 
	8.	 	The Confidential Information and all right, title and interest therein will remain at all
times the exclusive property of Disclosing Party its parent companies, subsidiaries and/or
affiliates. Nothing hereunder may be construed as granting to Receiving Party any right,
warranty or license by implication or otherwise under any patent, copyright, know-how or
design rights, or other form of protection of industrial or intellectual property, or as
creating any obligation on the part of Disclosing Party to enter into any business
relationship whatsoever or to offer for sale any service or product.

 

PORTIONS OF THIS EXHIBIT IDENTIFIED BY “****” HAVE BEEN DELETED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 406 TO
REGULATION C OF THE SECURITIES ACT OF 1933, AS AMENDED.

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	9.	 	Receiving Party recognizes, acknowledges and agrees that Disclosing Party may be
irreparably harmed if Receiving Party’s obligations and undertakings herein are not
specifically enforced, and that Disclosing Party would not have an adequate remedy at law in
the event of actual or threatened violation by Receiving Party of such obligations and
undertakings. Therefore, Receiving Party agrees that Disclosing Party shall be entitled to
seek and obtain an injunction, without bond, or to an appropriate decree of specific
performance or any other appropriate equitable relief.
	 
	10.	 	All of Disclosing Party’s rights hereunder and all of Receiving Party’s obligations and
undertakings hereunder shall be in full effect for the entire term of the R&DAgreement, and
for a period of 7 years after its termination, cancellation or expiration for any reason
whatsoever, so long as any information disclosed by Disclosing Party to Receiving Party
under this Agreement remains Confidential Information of Disclosing Party.
	 
	11.	 	The provisions of Section 10 of the R&D Agreement shall apply to this Agreement mutatis
mutandiss.

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	TopSpin Medical, Inc.  	 	Technion Research & Development	 	 
	 	 	 	 	 	 	Foundation Ltd.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Title:
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	Dr. Aharon Blank

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