Document:

exv10w8

 

EXHIBIT 10.8

STOCK OPTION GRANT PROGRAM

FOR

NONEMPLOYEE DIRECTORS UNDER THE

CARDIAC SCIENCE CORPORATION

2002 STOCK INCENTIVE PLAN

     The following provisions set forth the terms of the stock option grant program (the “Program”)
for nonemployee directors of Cardiac Science Corporation (the “Company”) under the Company’s 2002
Stock Incentive Plan (the “Plan”). The following terms are intended to supplement, not alter or
change, the provisions of the Plan, and in the event of any inconsistency between the terms
contained herein and in the Plan, the Plan shall govern. All capitalized terms that are not
defined herein shall be as defined in the Plan.

     1. Eligibility

     Each director of the Company elected or appointed who is not otherwise an employee of the Company
or a Related Company (an “Eligible Director”) shall be eligible to receive Initial Grants and
Annual Grants under the Plan, as discussed below.

     2. Initial Grants

     Each Eligible Director shall automatically receive a Nonqualified Stock Option to purchase 7,500
shares of Common Stock (an “Initial Grant”) upon such Eligible Director’s initial election or
appointment to the Board. Twenty-Five Percent (25%) of the shares subject to each Initial Grant
shall vest and become exercisable one year after the grant date of such Initial Grant and 1/36th of
remaining shares subject to such Initial Grant shall vest and become exercisable monthly thereafter
over the next three years.

     3. Annual Grants

     Commencing with the 2006 annual stockholders meeting, each Eligible Director shall automatically
receive a Nonqualified Stock Option to purchase 7,500 shares of Common Stock immediately following
each year’s Annual Meeting (each, an “Annual Grant”); provided that any Eligible Director who
received an Initial Grant within three months prior to an annual meeting shall not receive an
Annual Grant until immediately following the second annual meeting after the date of such Initial
Grant. Twenty-Five Percent (25%) of the shares subject to each Annual Grant shall vest and become
exercisable one year after the grant date of such Annual Grant and 1/36th of remaining shares
subject to such Annual Grant shall vest and become exercisable monthly thereafter over the next
three years.

 

 

     4. Option Exercise Price

     The exercise price of an Option shall be the Fair Market Value of the Common Stock on the Grant
Date.

     5. Manner of Option Exercise

     An Option shall be exercised by giving the required notice to the Company, stating the number of
shares of Common Stock with respect to which the Option is being exercised, accompanied by payment
in full for such Common Stock, which payment may be in whole or in part (a) in cash or check
(acceptable to the Plan Administrator), (b) by tendering shares of Common Stock you have owned for
at least six months, (c) if and so long as the Common Stock is registered under the Exchange Act,
by delivery of a properly executed exercise notice, together with irrevocable
instructions to a broker, to promptly deliver to the Company the amount of sale or loan proceeds to
pay the exercise price, all in accordance with the regulation of the Federal Reserve Board or (d)
by any other method permitted by the Plan Administrator.

     6. Term of Options

     Each Option shall expire ten years from the date of grant thereof, but shall be subject to earlier
termination as follows:

     (a) In the event that an Eligible Director ceases to be a director of the Company for any reason
other than death, the unvested portion of any Option granted to such Eligible Director (the
“Unvested Portion”) shall continue to vest in accordance with the applicable vesting schedule set
forth in Section 2 or Section 3 hereof. The vested portion of any Option may be exercised by the
Eligible Director until the earlier of (i) six months after the date on which the unvested portion
of all Options held by such Eligible Director is fully vested and exercisable and (ii) the
expiration date of the Option set forth in the Option’s grant notice.

     (b) In the event of the death of an Eligible Director, the Unvested Portion shall immediately
become fully vested and exercisable, and the Option may be exercised until the earlier of (i) one
year after the date of death of the Eligible Director and (ii) the expiration date of the Option
set forth in the Option’s grant notice, by the personal representative of the Eligible Director’s
estate, the person(s) to whom the Eligible Director’s rights under the Option have passed by will
or the applicable laws of descent and distribution or the beneficiary designated pursuant to
Section 11 of the Plan.

     7. Company Transactions

     In the event of any Company Transaction,

     (a) Except as provided in subsection (b) below, each outstanding Option shall be assumed or an
equivalent option or right substituted by the Successor Company.

     (b) If in connection with a Company Transaction the Successor Company refuses to assume or
substitute for an Option, then upon consummation of a Company Transaction, each outstanding Option
shall become fully vested and exercisable with respect to 100% of the

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unvested portion of the
Option. In such case, the Plan Administrator shall notify the Eligible Director in writing or
electronically that the unvested portion of each outstanding Option shall be fully vested and
exercisable for a specified time period, and each such Option may be
exercised until the earlier of (i) the expiration of the time period specified by the Plan Administrator and (ii) the expiration
date of the Option set forth in the Option’s grant notice. If the Option has not otherwise expired
by its terms, each such outstanding Option shall terminate at the expiration of the time period
specified by the Plan Administrator.

     (c) All Options shall terminate and cease to remain outstanding upon consummation the Company
Transaction, except to the extent assumed by the Successor Company.

     8. Amendment

     The Board may amend the provisions contained herein in such respects as it deems advisable. Any
such amendment shall not, without the consent of the Eligible Director, impair or diminish any
rights of an Eligible Director or any rights of the Company under an Option.

     Provisions of the Plan (including any amendments) that were not discussed above, to the extent
applicable to Eligible Directors shall continue to govern the terms and conditions of Options
granted to Eligible Directors.

     9. Effective Date

     The Program is effective as of January 1, 2006.

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PROGRAM ADOPTION AND AMENDMENTS

SUMMARY PAGE

	 	 	 	 	 
	Date of Board	 	 	 	Section/Effect
	Action	 	Action	 	of Amendment
	November 9, 2005	 	Initial Program Adoption	 	 

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EXHIBIT
10.33

Cardiac Science Corporation

Certain Executive Officers — 2006 Base Salaries

     Base salary amounts were approved by the Compensation Committee, to be effective May 1, 2006,
as set forth below. The compensation arrangement between the Company and each executive officer
listed below is governed by an employment agreement between the Company and each executive officer.

	 	 	 	 	 	 	 
	Name	 	Title	 	2007 Base Salary
	 
	 	 	 	 	 	 
	John Hinson

	 	Chief Executive Officer
	 	$	350,000	 
	 
	 	 	 	 	 	 
	Michael Matysik

	 	Chief Financial Officer
	 	$	240,000	 
	 
	 	 	 	 	 	 
	Kurt Lemvigh

	 	Vice President, International Sales
	 	DK 1,673,640
	 
	 
	 	 	 	 	 	 
	Darryl Lustig

	 	Vice President, North America

Cardiology Sales
	 	$	200,000exv10w36

 

EXHIBIT 10.36

FINAL EXECUTABLE VERSION dated 7-29-03

GEMS-IT — Cardiac Science OEM Agreement for AED and CRM

OEM PURCHASE AND SUPPLY AGREEMENT

This OEM Purchase and Supply Agreement (the “Agreement”) is made as of the 29th day of July, 2003
(the “Effective Date”) between Cardiac Science, Inc., a Delaware corporation (“Supplier” or
“Cardiac Science” or “CSI”), a medical device developer and manufacturer of automated external
defibrillators having its principal place of business at 1900 Main Street, Irvine, CA 92614 and GE
Medical Systems Information Technologies, Inc., a Wisconsin corporation (“GEMS-IT”), having its
principal place of business at 8200 W. Tower Avenue, Milwaukee, WI 53223. The parties hereby agree
as follows:

	1.	 	SCOPE OF AGREEMENT

	 	1.1	 	General. This Agreement specifies the terms and conditions under which
Supplier will manufacture, sell, license and support the OEM Products listed in
Exhibit A to this Agreement. Under this Agreement Cardiac Science shall
manufacture the OEM Products, which shall be regarded as “Original Equipment
Manufacturer” products under the GEMS-IT private label. Nothing in this Agreement
shall in any way limit the right of GEMS-IT or Cardiac Science to develop, produce,
market, sell or distribute any products whatsoever.
	 
	 	1.2	 	Marketing Authority. Supplier hereby grants to GEMS-IT the
non-exclusive right to promote, sell and distribute OEM Products worldwide. GEMS-IT
shall only be excluded from selling the OEM Products in Japan. GEMS-IT will have the
authority to market the OEM Products to the extent it deems appropriate, in its sole
discretion. GEMS-IT will have the right to use its own business and license terms for
all marketing and distribution of the OEM Products. The OEM Products will be marketed,
serviced, and supported by GEMS-IT’s field organization and channel partners, subject
to the marketing, service, and support obligations of Supplier pursuant to this
Agreement.
	 
	 	1.3	 	Eligible Purchasers. This Agreement enables GEMS-IT, GEMS-IT
Affiliates and GEMS-IT Subcontractors to purchase OEM Products from Supplier under the
terms of this Agreement or any subsequent Product Addendum. Unless a Product Addendum
specifically refers to and amends a term of this Agreement, the terms and conditions of
this Agreement will control and take precedence over any conflicting terms in a Product
Addendum.
	 
	 	1.4	 	Term of Agreement. This Agreement will commence as of the Effective
Date and continue for a 3 year period (the “Term”) after the date of the first delivery
to GEMS IT by Cardiac Science of the OEM Products unless terminated earlier under the
terms of this Agreement. After the initial Term, this Agreement may be renewed only
upon the written agreement of the parties.

	2.	 	DEFINITIONS

     The following capitalized terms will have these meanings throughout this Agreement.

 

			
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FINAL EXECUTABLE VERSION dated 7-29-03

GEMS-IT — Cardiac Science OEM Agreement for AED and CRM

	 	2.1	 	“Affiliate” means any person or entity directly or indirectly
controlling, controlled by, or under common control with a party to this Agreement.
“Control” shall be defined as direct or indirect power to direct or cause the direction
of the management or policies of another person or entity, whether through the
ownership of voting securities, by contract, or otherwise.
	 
	 	2.2	 	“CSI Proprietary Technology” means Cardiac Science’s proprietary
STAR® biphasic defibrillation technology, proprietary RHYTHMx® software
analysis algorithm and pacing technology, and RescueReady® self-testing technology, all
of which shall be incorporated in the OEM Products pursuant to this Agreement.
	 
	 	2.3	 	“Delivery Date” means the date specified in an Order for the delivery
of OEM Products by Supplier to the destination required under the Order.
	 
	 	2.4	 	“Documentation” means the user and technical manuals and other
documentation that Supplier will make available for the use of the OEM Products.
	 
	 	2.5	 	“Eligible Purchasers” mean those parties authorized to purchase OEM
Products under this Agreement as listed in Section 1.5 above.
	 
	 	2.6	 	“Forecast” means GEMS-IT’s estimate of its purchase requirements over a
six-month period, or such other period designated by the parties.
	 
	 	2.7	 	“Intellectual Property Rights” means all rights in patents, copyrights,
moral rights, trade secrets, mask works, Marks and other similar rights.
	 
	 	2.8	 	“Lead Time” means the time between the date an Order is sent and the
Delivery Date.
	 
	 	2.9	 	“Marks” means the trademarks, service marks, trademark and service mark
applications, trade dress, trade names, logos, insignia, symbols, designs or other
marks identifying a party or its products.
	 
	 	2.10	 	“Noncomplying Product” means any OEM Product received by GEMS-IT that
does not materially comply and/or perform in accordance with the Specifications, or
otherwise does not materially comply with the requirements of an Order or other
provisions of this Agreement, including applicable warranties. Noncomplying Products
include, without limitation, dead-on-arrival products, overshipments and early
shipments.
	 
	 	2.11	 	“AED or AEDs” means GEMS-IT private labeled Automated External
Defibrillators manufactured by Cardiac Science and listed in Exhibit A.
	 
	 	2.12	 	“CRM or CRMs” means GEMS-IT private labeled Cardiac Rhythm Modules
manufactured by Cardiac Science and listed in Exhibit A.
	 
	 	2.13	 	“OEM Products” means the products listed in Exhibit A, all
related Documentation, Parts and other deliverables provided pursuant to this
Agreement.

 

			
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FINAL EXECUTABLE VERSION dated 7-29-03

GEMS-IT — Cardiac Science OEM Agreement for AED and CRM

	 	2.14	 	“Orders” means a written or electronic purchase order or release issued
by GEMS-IT to Supplier for purchase of the OEM Products.
	 
	 	2.15	 	“Parts and Accessories” means the AED or CRM accessories, replacement
parts, components, consumables or other products that may be supplied in conjunction
with or as additions to the OEM Products.
	 
	 	2.16	 	“Product Addendum” means an addendum to this Agreement entered into
between Supplier and an Eligible Purchaser naming additional OEM Products and product
specific requirements in addition to those requirements specified in this Agreement.
	 
	 	2.17	 	“Software” means any software or firmware included or bundled with the
OEM Products, as designated in the description of OEM Products in Exhibit A.
	 
	 	2.18	 	“Specifications” means the technical and functional requirements for
the OEM Products as specified or referenced in Exhibit C.
	 
	 	2.19	 	“Technical Information” means Supplier’s manufacturing information and
technology deemed necessary by GEMS-IT to support OEM Products and to exercise any
manufacturing rights provided under this Agreement, including, but not limited to: (i)
specifications, software, schematics, software source code, designs, drawings or other
materials pertinent to the most current revision level of manufacturing of the OEM
Products; (ii) copies of all inspection, manufacturing, test, verification and quality
control procedures and any other work processes; (iii) jig, fixture and tooling
designs; (iv) supplier history files; (v) support documentation; and (vi) any
additional technical information or materials agreed to by the parties.

	3.	 	ORDER AND SHIPMENT OF OEM PRODUCTS

	 	3.1	 	Orders. Each delivery of OEM Products will be initiated by an Order
issued to Supplier by GEMS-IT. Each Order will include: (i) unit quantity; (ii) unit
price; (iii) shipping destination; (iv) Delivery Date; and (v) other instructions or
requirements pertinent to the Order. GEMS-IT may schedule regular intervals for
deliveries by an appropriate Order setting forth the intervals. To the extent of any
inconsistency between the terms of an Order and the terms of this Agreement, the terms
specified in this Agreement will control and take precedence.
	 
	 	3.2	 	Order Acknowledgment. An Order will be deemed to have been placed as
of the date of receipt of the Order by Supplier. Supplier will promptly confirm the
receipt of an Order electronically or through facsimile to GEMS-IT within two (2)
working days after receipt by Supplier of the Order. Orders within Forecasts and Lead
Time requirements of this Agreement will be deemed accepted upon receipt by Supplier.
If a GEMS-IT Order exceeds the Forecast or shortens the Lead Time, Supplier will use
its commercially reasonable best efforts to fill such excess or accommodate such
shorter Lead Time.

 

			
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FINAL EXECUTABLE VERSION dated 7-29-03

GEMS-IT — Cardiac Science OEM Agreement for AED and CRM

	 	3.3	 	Emergency Orders. If GEMS-IT deems it necessary, GEMS-IT may order OEM
Products by facsimile on an emergency basis (“Emergency Order”) subject to the
availability of such OEM Products in Supplier’s inventory. Supplier will use its best
efforts to ship the Emergency Order to GEMS-IT’s stipulated destinations within 8 work
hours after the receipt by Supplier. Subject to GEMS-IT’s approval, GEMS-IT will pay
any additional expenses related to such Emergency Orders.
	 
	 	3.4	 	Forecasts. GEMS-IT will provide a six month rolling Forecast of its
projected Orders. Any quantities listed in any Forecast or other correspondence
between the parties are only estimates made as an accommodation for planning purposes
and do not constitute a commitment on GEMS-IT’s part to purchase such quantity.
GEMS-IT may revise any Forecasts in its sole discretion.
	 
	 	3.5	 	Initial Purchase Requirement. There shall be no minimum purchase
commitment during the Term of the Agreement, however, concurrent with the initiation of
the Agreement, GEMS-IT shall purchase from Supplier the following minimum quantity of
OEM Products for delivery by not later than the end of the calendar quarter immediately
following the calendar quarter in which the Agreement is executed:

	 	3.5.1	 	GEMS-IT labeled AEDs — [ * ]
	 
	 	3.5.2	 	GEMS-IT labeled CRMs — [ * ]

	 	3.6	 	Lead Time. Supplier will determine the Lead Time for each OEM Product
and will provide GEMS-IT with written notice of such Lead Time, which in no event will
exceed four (4) weeks without GEMS-IT’s prior written consent. Supplier must give
GEMS-IT no less than 30 days advance notice to approve or reject any proposed increase
in Lead Time. CSI and GEMS-IT will review lead-time reduction opportunities two
calendar quarters after date of first shipment.
	 
	 	3.7	 	Inventory Requirement. Supplier will maintain a protective inventory
equal to no less than two (2) weeks supply of each OEM Product. If this inventory is
depleted, Supplier will replenish the inventory as soon as possible after depletion.
In addition, Supplier will rotate its supply of OEM Products in inventory to maintain a
fresh stock of inventory.
	 
	 	3.8	 	Order Changes. GEMS-IT may, without charge, postpone, decrease,
increase, or cancel any Order by notice to Supplier at least fifteen (15) days prior to
the Delivery Date. If GEMS-IT postpones, decreases, or cancels an Order after such
time period, Supplier will be entitled to reimbursement by GEMS-IT for actual costs
incurred by Supplier as a direct result of such action that are not recoverable by
Supplier within a reasonable period of time.
	 
	 	3.9	 	Shipment Requirements. All Orders are required to be shipped complete.
Freight expenses and duties will be paid by GEMS-IT. Supplier will give GEMS-IT

 

			
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FINAL EXECUTABLE VERSION dated 7-29-03

GEMS-IT — Cardiac Science OEM Agreement for AED and CRM

	 	 	 	immediate notice if it knows that it cannot meet a Delivery Date or that only a
portion of the OEM Products will be available for shipment to meet a Delivery Date.
If due to Supplier’s failure to make a timely shipment to meet a Delivery Date,
Supplier will pay for any resulting increase in the freight cost over that which
GEMS-IT would have been required to pay. For partial shipments, Supplier will ship
the available OEM Products unless directed by GEMS-IT to reschedule shipment. If
Supplier ships any OEM Product by a method other than as specified in the
corresponding Order, Supplier will pay any resulting increase in the cost of
freight. GEMS-IT may utilize drop shipment options to any GEMS-IT designated
delivery destination. If GEMS-IT designates a drop shipment location outside the
country in which the Order is placed, GEMS-IT agrees to pay any additional costs
associated with the shipment.
	 
	 	3.10	 	GEMS-IT Option To Accept Overshipments. If Supplier ships more OEM
Products than ordered, the amount of the overshipment may either be kept by GEMS-IT for
credit against future Orders or returned to Supplier pursuant to Section 6 below, at
GEMS-IT’s election.
	 
	 	3.11	 	No Advance Shipment. If OEM Products are delivered two (2) days in
advance of the Delivery Date, GEMS-IT may, at its option, either return the OEM
Products pursuant to Section 6 or keep the OEM Products with payment due as provided in
Section 4 of the Agreement.
	 
	 	3.12	 	Title And Risk Of Loss. Shipments will be F.O.B. Cardiac Science’s
Minnetonka, MN factory or Copenhagen, Denmark warehouse facility. GEMS IT will elect
at which location it (or its designated carrier) will take delivery of the OEM Products
from Cardiac Science. Except as otherwise provided in this Agreement, associated
freight expenses and duties will be paid directly by GEMS-IT. Title to OEM Product
hardware and media ordered under this Agreement and risk of loss or damage will pass
from Supplier to GEMS-IT upon Supplier’s delivery of the OEM Products to the common
carrier specified by GEMS-IT, subject to the provisions in Sections 3.13 and 3.14 below
with respect to packing and handling.
	 
	 	3.13	 	Packing List. Each delivery of OEM Products to GEMS-IT must include a
packing list that contains at least:

	 	(a)	 	The Order number and the GEMS-IT part number;
	 
	 	(b)	 	The quantity of OEM Products or Parts shipped; and
	 
	 	(c)	 	The date of shipment.

	 	3.14	 	Packaging. Supplier must preserve, package, handle, and pack all OEM
Products so as to protect the OEM Products from loss or damage, in conformance with
good commercial practice, the Specifications, GEMS IT’s indication of “ship to”

 

			
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FINAL EXECUTABLE VERSION dated 7-29-03

GEMS-IT — Cardiac Science OEM Agreement for AED and CRM

	 	 	 	address and method of transportation, government regulations, and other applicable
standards.
	 
	 	3.15	 	Responsibility For Damage. Supplier will be liable for any loss or
damage due to its failure to properly preserve, package, handle, or pack OEM Products.
GEMS-IT will not be required to assert any claims for such loss or damage against the
common carrier involved.

	4.	 	PRICES AND PAYMENT TERMS

	 	4.1	 	OEM Product Prices. Supplier’s prices for the OEM Products are listed
in Exhibit B, in U.S. currency unless otherwise stated, and may not be
increased without GEMS-IT’s written consent. The prices for Parts and Accessories will
be Supplier’s published prices, less any applicable discounts as set forth in
Exhibit B, unless the parties agree to a price schedule for Parts and
Accessories. OEM Products and Parts will also be subject to any applicable prompt
payment discounts.
	 
	 	4.2	 	Changed Prices. If during the Term changed prices or price formulas
are put in effect by mutual agreement of GEMS-IT and Supplier, or reduced prices or
price formulas are otherwise put in effect by Supplier, such prices or price formulas
(if resulting in lower prices than the then current price) will apply to all Orders
issued by GEMS-IT after the effective date of such prices or price formulas and to all
unshipped Orders.
	 
	 	4.3	 	Payment Procedure. Payment for OEM Products will be 2% / 15, Net 75
days from the invoice date for the OEM Products following shipment by Supplier.
GEMS-IT will not be liable for payments or any costs related to unordered or
Noncomplying Products.
	 
	 	4.4	 	Sales Taxes And Duties. Prices are exclusive of all taxes or duties
after delivery to the designated destination (other than taxes levied on Supplier’s
income) that Supplier may be required to collect or pay upon shipment of the OEM
Products. Any such taxes or duties must appear as a separate item on Supplier’s
invoice. GEMS-IT agrees to pay such taxes or duties unless GEMS-IT is exempt from such
taxes or duties. Where applicable, GEMS-IT will provide Supplier with an exemption
resale certificate.

	5.	 	NONCOMPLYING PRODUCTS

	 	5.1	 	Acceptance. GEMS-IT shall inspect the OEM Products within a reasonable
period of time upon receipt at the shipping destination and may reject any Noncomplying
Products. GEMS-IT may elect in its sole discretion to return a Noncomplying Product
for replacement or repair at Supplier’s expense. In addition, GEMS-IT may return for
repair or replacement an entire lot of OEM Products if a tested sample of that lot
contains Noncomplying Products. Any OEM Products not rejected by written notice to
Supplier within sixty (60) days of

 

			
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FINAL EXECUTABLE VERSION dated 7-29-03

GEMS-IT — Cardiac Science OEM Agreement for AED and CRM

	 	 	 	GEMS-IT receipt shall be deemed accepted. Acceptance by GEMS IT of any OEM Products
shall in no way limit GEMS IT’s rights under any applicable warranties for the OEM
Products. Supplier shall provide reasonable assistance to GEMS-IT in accordance
with GEMS IT’s corrective action procedures (which have been described to Supplier)
in order to determine whether any of the Products are Noncomplying Products. No
returns will be accepted without a Return Materials Authorization (“RMA”). GEMS-IT
shall provide a SCAR report with any non complying product being returned. Other
than as permitted in this Section 5.1 or under the terms of a warranty covering the
OEM Products, goods may not be returned to Supplier without Supplier’s consent.
	 
	 	5.2	 	Repair Period. Supplier shall ship replacement or repaired OEM
Products to GEMS-IT as promptly as possible, but not later than ten (10) working days
after Supplier’s receipt of Noncomplying Product.

	6.	 	RETURN OF PRODUCTS

	 	6.1	 	Return Materials Authorization. All OEM Products returned by GEMS-IT
to Supplier must be accompanied by a RMA. Unless further verification is reasonably
required by Supplier, Supplier will supply an RMA within two work days after receiving
GEMS-IT’s written request.
	 
	 	6.2	 	Return Charges. All Noncomplying Products returned by GEMS-IT to
Supplier, and all replacement or repaired OEM Products shipped by Supplier to GEMS IT
to replace Noncomplying Products, will be at Supplier’s risk and expense, including
transportation charges (round trip charges for replacement or repaired OEM Products).
	 
	 	6.3	 	Duty To Remove Marks Or Destroy Noncomplying Products. Supplier agrees
not to sell, transfer distribute or otherwise convey any part, component, product or
service bearing or incorporating GEMS-IT Marks, part numbers or other identifiers,
including any GEMS-IT packaging, copyrights or code, to any party other than to
Eligible Purchasers. Supplier will remove from all rejected, returned or unpurchased
OEM Products any such GEMS-IT Marks or identifiers, even if such removal would require
destruction of the OEM Products. Supplier further agrees not to represent that such
OEM Products are built for GEMS-IT or to GEMS-IT specifications. Supplier will defend
and indemnify GEMS-IT against any claims, losses, liabilities, costs or expenses that
GEMS-IT may incur as a result of Supplier’s breach of this obligation.

	7.	 	ENGINEERING PROCESS OR DESIGN CHANGES

	 	7.1	 	Supplier Proposed Changes. Supplier will not, without the prior
written consent of GEMS-IT, make or incorporate in OEM Products any of the following
changes (collectively, “Engineering Changes”):

 

			
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FINAL EXECUTABLE VERSION dated 7-29-03

GEMS-IT — Cardiac Science OEM Agreement for AED and CRM

	 	(1)	 	Process or design changes which affect the intended use,
function or quality of the OEM Products;
	 
	 	(2)	 	Geographical relocation of manufacturing processes; or
	 
	 	(3)	 	Process step discontinuances affecting the electrical
performance, the mechanical form, fit, or function, the environmental
compatibility or chemical characteristics, software compatibility, or the life,
reliability, or quality of OEM Products.

	 	7.2	 	Notice Of Proposed Change. Supplier will give GEMS-IT notice of any
proposed Engineering Change, and will provide evaluation samples and other appropriate
information as specified by GEMS-IT at least 90 days prior to the first proposed
shipment of any OEM Products involving an Engineering Change. Regardless of whether
GEMS-IT approves a proposed Engineering Change, Lead Time will not be changed except as
provided in Section 3.5 above.
	 
	 	7.3	 	Safety Standard Changes. Supplier will immediately give notice to
GEMS-IT if any upgrade, substitution or other change to an OEM Product is required to
make that product meet applicable safety standards or other governmental statutes,
rules, orders or regulations, even those that are not defined as Engineering Changes in
Section 7.1 above. All affected OEM Products already purchased by GEMS-IT may,
at GEMS-IT’s election, either be returned to Supplier for upgrade to current revisions
or upgraded by Supplier or GEMS-IT in the field pursuant to the procedures outlined in
Section 14.6 below.

	8.	 	QUALITY

	 	8.1	 	Quality Program. Supplier agrees to maintain an objective quality
program for all OEM Products. Supplier’s program will be (i) in accordance with the
current revision of GEMS-IT’s Supplier Quality System Requirements, (ii) consistent
with regulatory requirements applicable for products of the same type as the OEM
Products and for the jurisdictions where regulatory approvals for the OEM Products have
been obtained, and (iii) if applicable, any additional or substitute quality
requirements agreed to by the parties. Supplier will, upon GEMS-IT’s request, provide
to GEMS-IT copies of Supplier’s program and supporting test documentation. Supplier
shall maintain device history records for each OEM Product shipped to GEMS-IT,
including the date of manufacture, identifying lot codes and serial numbers, and
provide that information to GEMS-IT upon request.
	 
	 	8.2	 	GEMS-IT’s Right To Inspect. GEMS-IT has the right to inspect, at
Supplier’s plant, the OEM Products and associated manufacturing processes.
Manufacturing processes may be inspected at any time during the Term. GEMS-IT’s
inspection may be for any reason reasonably related to this Agreement, including to
assure Supplier’s compliance with GEMS-IT’s requirements and with the regulatory and
quality provisions of this Agreement. GEMS-IT’s right of inspection will apply

 

			
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	 	 	 	as well to any vendor or subcontractor of Supplier. Supplier will inform such
vendors or subcontractors of GEMS-IT’s right to inspect, and, if necessary, use all
reasonable effort to secure such rights for GEMS-IT.
	 
	 	8.3	 	Continuing Guarantee for SELLER as required by the FD&C Act and Other
Applicable Law. The articles comprising each shipment for delivery hereafter made
by Supplier to or on the order of GEMS-IT are hereby guaranteed by Supplier as of the
date of shipment or delivery to be on that date: (a) manufactured and released as
finished devices in accordance with the applicable provisions of the Federal Food, Drug
and Cosmetic Act (FDCA) as amended (21 U.S.C. section 301 et seq.) relating to
adulterated or misbranded devices; (b) not an article which may not, under the
provisions of sections 404 or 405 of the FDCA, be introduced into interstate commerce;
(c) in compliance with the provisions of sections 510, 513, and 515 of the FDCA. This
guarantee is continuing and shall remain in full force and effect until revoked in
writing.
	 
	 	8.4	 	Compliance with Quality System Regulation. Supplier represents and
warrants that it is in substantial compliance with 21 CFR part 820 with respect to the
OEM Products existing as of the date of this Agreement, and Supplier shall
substantially comply with 21 CFR part 820 with respect to any future OEM Products which
may become subject to this Agreement. Supplier shall be responsible for obtaining CE
Marking for the OEM Products. Supplier also represents and warrants that it is in
substantial compliance with any and all quality-related laws, rules and regulations of
any other country worldwide with respect to the OEM Products existing as of the date of
this Agreement, and Supplier shall substantially comply with such laws, rules and
regulations with respect to any future OEM Products which may become subject to this
Agreement.

	9.	 	WARRANTIES AND SUPPORT OBLIGATIONS

	 	9.1	 	Warranty Period. All warranties set forth in Section 9.2 below will
survive any inspection, delivery, acceptance, or payment by GEMS IT and (except for the
warranty included in Section 9.2(2) below) will survive indefinitely. The warranty
included in Section 9.2(2) below shall be in effect for the periods set forth in
Sections 9.1.1 and 9.1.2.

	 	9.1.1	 	AED product: for [ * ] from date of shipment of
the OEM Product to GEMS IT’s end user customers. Batteries are
for [ * ] from date of installation into the AED device. Accessories and consumables for
ninety (90) days or until expiration date whichever is longer.
	 
	 	9.1.2	 	CRM product: for [ * ] from date of shipment of
the OEM Products to GEMS IT’s end user customers. Accessories and consumables
for ninety (90) days or until expiration date whichever is longer.

	 	9.2	 	Limited Warranty. Supplier warrants during the applicable Warranty
Period that each OEM Products will:

 

			
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	 	(1)	 	Be manufactured, processed, and assembled by Supplier or by
companies under Supplier’s direction.
	 
	 	(2)	 	Conform and perform in accordance with the Specifications, and
other criteria referred to in this Agreement or agreed to by the parties in
writing:
	 
	 	(3)	 	Be new, except as otherwise provided by the parties.
	 
	 	(4)	 	Be free from defects in design, material and workmanship
	 
	 	(5)	 	Be free and clear of all liens, encumbrances, restrictions, and
other claims against title or ownership
	 
	 	(6)	 	Not violate or infringe any third party Intellectual Property
Rights, and Supplier warrants that it is not aware of any facts upon which such
claim could be made. If Supplier learns of any claim or any facts upon which
claim could be made, it will promptly notify GEMS-IT of this information.

	 	9.3	 	Warranty Obligation. During the applicable Warranty Period, Supplier
shall be obligated to repair or replace any OEM Product that does not conform or
perform in accordance with the warranties set forth in Section 9.2 above. In addition,
GEMS IT shall have such other rights and remedies available at law or otherwise
available under this Agreement for breach of the foregoing warranties.
	 
	 	9.4	 	Warranty Service Logistics and Availability. Supplier agrees to make
its service personnel available to GEMS-IT personnel (via phone and/or fax) during
regular business hours at no cost to GEMS-IT to address support obligations under this
Agreement. If required, on an emergency basis, Supplier agrees on a worldwide basis to
make on-site service available at an additional charge to GEMS-IT. The cost for
on-site service shall be mutually determined by the Parties on a case by case basis.

	 	9.4.1	 	Customer Service.

	 	a.	 	Customer service calls will be handled by
GEMS-IT. If customer calls GEMS-IT with Product Warranty issue (GE
fields Warranty call), GEMS-IT will inform Supplier of Warranty call
and will receive a RMA from Supplier. GEMS IT’s customer will return
the product for repair or replacement to Supplier’s facility in
Minnetonka, MN (for Americas) or Copenhagen, Denmark (for Europe, Asia,
Africa and Middle East).
	 
	 	b.	 	If GEMS IT’s customer calls requiring in-field
service, GEMS-IT will bill customer as appropriate per GEMS-IT policies
(flat rate paid by GEMS-IT). GEMS-IT will inform Supplier of customer
issue and will receive a RMA from Supplier. GEMS-IT or its customer
will return product to Supplier facility as outlined in

 

			
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	 	 	 	9.4.1 (a) above. Supplier will repair and return product to
customer. Supplier will bill GEMS-IT a flat rate per unit, which
rate shall be negotiated with annual adjustments based in CPI.
GEMS-IT will bill customer for service call.
	 
	 	c.	 	If customer calls requiring Parts, GEMS-IT will
inform Supplier and request direct shipment of Parts to GEMS-IT
customer. Supplier will bill GEMS-IT at agreed upon cost of Parts and
GEMS-IT will bill customer.

	 	9.5	 	Service Period. During the Term and for a period of at least [ * ]
following the last shipment to GEMS-IT of the applicable OEM Product ordered by GEMS-IT
hereunder, Supplier shall make available necessary replacement parts, technical support
and repair service (or at Supplier’s sole discretion, exchange units for the OEM
Products) for purchase by GEMS-IT and third party users of the OEM Products at
Supplier’s then-current prices for such replacement parts, technical support and repair
services and exchange units (unless otherwise covered by warranty or service
agreement).
	 
	 	9.6	 	DISCLAIMER. EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, SUPPLIER
MAKES ANY OTHER WARRANTIES, EITHER EXPRESS OR IMPLIED, REGARDING MERCHANTABILITY OR
THEIR FITNESS FOR ANY PARTICULAR PURPOSE FOR ANY OEM PRODUCTS,

	10.	 	OBSOLESCENCE FOR DISCONTINUED PRODUCTS

	 	10.1	 	Buy Rights. Supplier acknowledges its obligation to manufacture,
supply and support the OEM Products without interruption for the Term of the Agreement.
If, however, Supplier seeks to discontinue the supply or support of any OEM Product
during the Term of the Agreement (a “Discontinued Product”), Supplier will give notice
to GEMS-IT no less than twelve (12) months in advance of the last date the Discontinued
Product can be ordered. After receipt of notice of discontinuance, GEMS-IT may
purchase from Supplier such quantity of the Discontinued Product as GEMS-IT deems
necessary for its future requirements.

	11.	 	MARKETING AND LICENSING

	 	11.1	 	No Rights In Marks. Except as otherwise specified in the private
labeling section below, nothing in this Agreement should be construed to grant either
party any rights in the Marks of the other party. Supplier acknowledges, however, that
GEMS-IT may use the name of the OEM Products and Supplier’s marks in advertising and
marketing the OEM Products. The OEM Products will be affixed with applicable patent
numbers copyright notices, including Cardiac Science STAR®, RescueReady® and RHYTHMx®
marks identifying the CSI Proprietary Technology, sufficient to give notice as to the
rights of the parties in their respective products.

 

			
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	 	11.2	 	Private Labeling. Supplier will ensure that the OEM Products sold to
GEMS-IT contain the GEMS-IT Marks, serial number and packaging specified by GEMS-IT and
conforming to GEMS-IT specifications for external appearance (which will not require
any material change in form or dimensions of the OEM Products or require commercially
unreasonable actions). GEMS-IT shall provide Supplier with a list of sequential serial
numbers to be applied to each OEM Product and shipping container by Supplier and
Supplier shall apply such numbers per GEMS-IT’s instructions. In addition, and without
limiting the foregoing, Supplier will ensure that each OEM Product label includes the
following statement: “Manufactured for GE Medical Systems Information Technologies by
Cardiac Science — STREET ADDRESS, CITY, STATE.” Except as provided herein, Supplier
will have no other right or license in any GEMS-IT marks.
	 
	 	11.3	 	Documentation License. Supplier hereby grants GEMS-IT a non-exclusive,
non-transferable, worldwide fully paid up license to use, reproduce, distribute and
prepare derivative works in GEMS-IT’s name all Documentation and other information,
other than confidential information, furnished by Supplier under this Agreement.
GEMS-IT has the right to use or modify the Supplier’s Product documentation or excerpts
therefrom, for instance as follows: Functional description, Instruction sheet and
product labels, Operators aids, Promotion information, and Product/Function
description. Supplier shall provide GEMS-IT with this Product documentation free of
charge both as a print version and on data media in readable form. These rights with
respect to the Documentation will extend to GEMS-IT Subsidiaries and third party
channels of distribution. GEMS-IT may reproduce such Documentation without Supplier’s
logo or other identification of source, subject to affixing copyright notices to all
copies of Documentation. These rights with respect to the Documentation will extend to
GEMS-IT Subsidiaries and third party channels of distribution.

	12.	 	INTELLECTUAL PROPERTY PROTECTION

	 	12.1	 	Ownership. Except as expressly provided herein, neither Party grants
to the other Party any license or intellectual property right, either by implication,
estoppels or otherwise in and to its products, patents, trademarks, documentation or
confidential information. Except in the case of GEMS-IT’s need to service OEM
Products, GEMS-IT shall not: (a) reverse engineer, decompile, disassemble or otherwise
tamper with the OEM Products; (b) install, integrate, adapt or use the OEM Products
except as described in the Documentation; (c) remove or alter any proprietary designs
notices or Marks contained in or on the OEM Products, Documentation or related
materials and (d) authorize any third party, including any of GEMS-IT distributors or
end user customers, to do any of the foregoing.
	 
	 	12.2	 	Supplier’s Duty To Defend. Supplier will defend, indemnify and hold
harmless GEMS-IT, its Affiliates and its Subsidiaries, subcontractors and customers
from any claim that any OEM Product, any Software, Documentation or a Supplier Mark, or
any product provided as part of Supplier’s support services constitutes an unauthorized
use or infringement of any third party’s Intellectual Property

 

			
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	 	 	 	Rights. Supplier will pay all costs, damages and expenses (including reasonable
attorneys’ fees) incurred by GEMS-IT, its Subsidiaries, subcontractors or customers
and will pay any award with respect to any such claim or agreed to in any settlement
by Supplier of such a claim.
	 
	 	12.3	 	GEMS-IT’s Duty To Notify. GEMS IT will give Supplier prompt notice of
any such claim or action, and will give Supplier the authority, information, and
reasonable assistance (at Supplier’s expense) necessary to defend. If Supplier does
not diligently pursue resolution of the claim nor provide GEMS IT with reasonable
assurance that it will diligently pursue resolution, then GEMS IT may, without in any
way limiting its other rights and remedies, defend the claim.
	 
	 	12.4	 	Remedies For Infringing Products. If the use or combination of any
product provided hereunder is enjoined (the “Infringing Product”), Supplier will, at
its sole expense and option:

	 	(1)	 	Procure for GEMS-IT and its customers the right to continue
using or combining the Infringing Product;
	 
	 	(2)	 	Replace the Infringing Product with a non-infringing product of
equivalent function and performance; or
	 
	 	(3)	 	Modify the Infringing Product to be non-infringing, without
detracting from function or performance.

	 	12.5	 	Limitations. Supplier will be relieved of its indemnification
obligations under this Article 12 to the extent that the claim arises solely
and directly from Supplier’s compliance with a GEMS-IT Specification, provided that all
implementations of that Specification constitute an unauthorized use or infringement of
a third party Intellectual Property Right.

	13.	 	IMPORT / EXPORT COMPLIANCE

	 	13.1	 	Country Of Origin Certification. Upon GEMS-IT’s request, Supplier will
provide GEMS-IT with an appropriate certification stating the country of origin for OEM
Products, sufficient to satisfy the requirements of the customs authorities of the
country of receipt and any applicable export licensing regulations, including those of
the United States. In addition, Supplier will provide NAFTA certification (if Supplier
determines the OEM Products qualify).
	 
	 	13.2	 	Country Of Origin Marking. Supplier will mark each OEM Product, or the
container if there is no room on the OEM Product, with the country of origin in
accordance with U.S. Government regulations (Supplier shall only mark “Made in USA” on
products or containers if the product meets the U.S. Government Federal Trade
Commission requirements for use of such a label). Supplier will, in marking OEM
Products, comply with the requirements of the customs authorities of the country of
receipt.

 

			
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	 	13.3	 	Duty Drawback. If OEM Products delivered under this Agreement are
imported by the OEM as the importer of record in the country of receipt, Supplier will,
upon GEMS-IT’s request, provide GEMS-IT with documents required by the customs
authorities of the country of receipt to prove importation and to transfer duty
drawback rights to GEMS-IT.
	 
	 	13.4	 	Export Compliance. (a) In performing its obligations under this
Agreement, Supplier shall comply with all applicable export laws, regulations and rules
administered by the United States Customs Service, the Bureau of Industry and Security
and the Food and Drug Administration, as well as all other applicable federal, state or
local laws, regulations or requirements of the United States and any other nation.
Supplier shall obtain all applicable permits and licenses necessary to perform its
obligations under this Agreement.

	 	(b)	 	If Supplier obtains Bureau of Industry and Security commodity
classifications for the OEM Products, Supplier shall provide a copy of the
CCATS document, including any revisions thereto during the Term of this
Agreement. If Supplier obtains any U.S. Customs Rulings relating thereto,
Supplier shall provide copies of the resulting revisions.
	 
	 	(c)	 	Supplier shall indemnify and save harmless GEMS IT, its
affiliates, officers, directors, employees, successors and assigns from any and
against any losses, damages, liabilities, fines, penalties, and expenses
(including reasonable attorney’s fees) arising out of or resulting from the
failure to comply with this provision, provided that GEMS IT gives Supplier
prompt written notice of any such claim and requisite authority, information
and assistance to defend such claim.
	 
	 	(d)	 	During the Term and for a period of five (5) years thereafter,
Supplier shall keep accurate and complete export documentation records relating
the OEM Products in accordance with U.S. Export regulations and FDA
requirements and the requirements of any other similar agency of any other
nation that will have jurisdiction over Supplier as a result of its performance
of its obligations under this Agreement. If the U.S. Government or other
government or agency requests the production of such records, Supplier shall
copy and produce the records at no charge to GEMS IT.
	 
	 	(e)	 	Upon reasonable advance notice to Supplier and during normal
business hours, GEMS IT may, at its option and expense, conduct audits at any
Supplier Service Location of documents relating to the OEM Products to assure
that Supplier is in compliance with all export and FDA laws, regulations and
requirements, including record keeping. GEMS IT may make copies of any records
it reviews during its audits. Further, upon reasonable advance notice to
Supplier, GEMS IT may request copies of any export documentation records
relating to the OEM Products, which Supplier will provide free of charge. If
an audit reveals non-compliance,

 

			
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	 	 	 	undercharges or overcharges, Supplier will take appropriate measures to
rectify the situation and bring the Supplier Service Location into
compliance.
	 
	 	(f)	 	During the Term and for a period of five (5) years thereafter,
GEMS IT may request from Supplier copies of records deemed necessary to defend
against any claim related to this Section 13.4 made by a third party, including
federal, state or local government. Such records shall not be unreasonably
withheld.

	14.	 	GOVERNMENTAL COMPLIANCE

	 	14.1	 	Duty To Comply. Supplier agrees to comply with all federal, state,
local and foreign laws, rules, and regulations applicable to its performance of this
Agreement or to OEM Products. Without limiting the generality of the foregoing
sentence, Supplier represents that:

	 	(1)	 	Supplier will comply with all applicable equal employment
opportunity and non-discrimination requirements prescribed by Presidential
Executive Orders, including the requirements of Executive Order 11246, the
Vocational Rehabilitation Act, and the Vietnam Era Veterans’ Readjustment
Assistance Act;
	 
	 	(2)	 	Each chemical substance contained in OEM Products is on the
inventory of chemical substances compiled and published by the Environmental
Protection Agency pursuant to the Toxic Substances Control Act;
	 
	 	(3)	 	All OEM Products will be shipped in conformance with government
or freight regulations and requirements applicable to chemicals; and
	 
	 	(4)	 	Supplier will provide complete and accurate material safety
data sheets prior to shipping any OEM Product.

	 	14.2	 	Procurement Regulations. For OEM Products purchased under this
Agreement for incorporation into products to be sold under a federal contract or
subcontract, those applicable procurement regulations that are required by federal
statute or regulation to be inserted in contracts or subcontracts will be deemed
incorporated in this Agreement and made to apply to all Orders.
	 
	 	14.3	 	Regulatory Approvals. Supplier shall provide a listing of countries
where the OEM Products have received all regulatory and other necessary and/or
appropriate approvals for the sale of any OEM Product. Supplier will be solely
responsible for identifying, obtaining, and maintaining at its sole cost and expense
all regulatory and other necessary and/or appropriate approvals in any country
worldwide which are applicable to this Agreement. If any such approval is subsequently
revoked, terminated or suspended, Supplier shall immediately notify GEMS IT of such
occurrence.

 

			
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	 	14.4	 	Complaint Handling. GEMS-IT will be responsible for the coordination
of customer complaint investigations. As determined by GEMS-IT, Supplier will
investigate customer complaints at no charge and supply GEMS-IT with a written report
summarizing the cause for the complaint and any corrective actions required within 14
days of receipt by Supplier of such complaint, it being understood that, depending on
the nature of the complaint and investigation, the initial (14-day) response may be
limited in scope and then followed up by a complete response as soon as reasonable
practicable thereafter.
	 
	 	14.5	 	Duty to Report Incidents. GEMS-IT and Supplier shall inform each other
in writing, within 5 business days from knowledge of a reportable event, of all
incidents relating to the subject matter of the Agreement that must be reported
according to the FDA Medical Device Reporting regulation (21 CFR Part 803) or the
European Medical Device Vigilance regulations or that must be registered according to
other national regulations such as Canadian medical device regulations, including
without limitation incidents involving death or serious injury, malfunctions that, if
recurrent, may cause or contribute to death or serious injury or other material quality
problems or concerns. GEMS-IT will be responsible for reporting such incidents to the
appropriate regulatory authority. Supplier shall fully cooperate with GEMS-IT as may
be necessary to comply with any reporting obligations regarding such incidents or
quality concerns.
	 
	 	14.6	 	Recalls and Field Corrections. In the event of any recall, product
withdrawal or field correction of any OEM Product that is required by a governmental
agency, by Supplier, or by GEMS-IT for safety or efficacy reasons, the parties agree
that (a) they shall promptly notify each other and (b) they shall fully cooperate with
each other concerning the necessity and nature of such action. GEMS-IT shall be the
point of contact for purchasers of any OEM Product (whether directly or through its
distributors) and shall be responsible for making any and all applicable regulatory
authority contacts and for coordination of any recall or field correction activities
involving such OEM Products, whether or not such action was requested by Supplier. In
the event that any OEM Product requires field correction or is recalled as a result of
(a) the supply by Supplier of a Noncomplying Product or (b) the grossly negligent or
intentionally wrongful act or omission of Supplier or its affiliates or their
representatives, then Supplier shall bear all costs and expenses, including but not
limited to the costs and expenses related to such recall or field correction,
communications and meetings with all required regulatory agencies, replacement stock,
service labor, installation, travel, notifying customers of such recall and any
replacement product to be delivered to those same customers, including shipping costs.
To the extent that any such recall or field correction is due in part to the negligent
or intentional acts or omissions of GEMS-IT, GEMS-IT shall be responsible for such
costs and expenses equitably in proportion to its fault.
	 
	 	14.7	 	Regulatory Agency Inquiries. If the FDA or any other regulatory body
with authority over medical devices provides written notice to either party to inquire
about or investigate any OEM Product, the party notified shall use its best efforts

 

			
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	 	 	 	to give notice thereof to the other party within one working day of receipt of such
contact from the FDA or other body.

	15.	 	FORCE MAJEURE EVENTS

	 	15.1	 	Delaying Causes. Subject to the provisions of this Article, Supplier
will not be liable for any delay in performance under this Agreement caused by any “act
of God” or other cause beyond Supplier’s control and without Supplier’s fault or
negligence (a “delaying cause”). Notwithstanding the above, Supplier will not be
relieved of any liability for any delay or failure to perform its defense obligations
with respect to third party Intellectual Property Rights or furnish remedies for
Infringing Products as described in Article 12 above.
	 
	 	15.2	 	GEMS-IT Option. Supplier will immediately give GEMS-IT notice of any
delaying cause and its best estimate of the expected duration of such cause. In the
event of a delaying cause, GEMS-IT may act in its sole discretion to:

	 	(1)	 	Terminate this Agreement or any part hereof as to OEM Products
not shipped; or
	 
	 	(2)	 	Suspend this Agreement in whole or in part for the duration of
the delaying cause, buy similar products elsewhere, and deduct from any
quantities specified under this Agreement the quantity so purchased.

	 	15.3	 	Resumption Of Agreement. If GEMS-IT elects to purchase other similar
products in the event of a delaying cause, GEMS-IT may resume performance under this
Agreement once the delaying cause ceases and extend the Term up to the length of time
the delaying cause endured. Unless GEMS-IT gives notice of termination as provided
above within 30 days after notice from Supplier of the delaying cause, GEMS-IT will be
deemed to have elected to suspend this Agreement for the duration of the delaying
cause.

	16.	 	EVENTS OF DEFAULT

	 	16.1	 	Notice Of Breach. If either party is in breach of any provision of
this Agreement, the nonbreaching party may, by notice to the breaching party, except as
otherwise prohibited by the United States bankruptcy laws, terminate the whole or any
part of this Agreement or any Order, unless the breaching party cures the breach within
30 days after receipt of notice in writing.
	 
	 	16.2	 	Causes Of Breach. For purposes of Section 16.1, above, the
term “breach” includes without limitation any:

	 	i.	 	Proceeding, whether voluntary or involuntary,
in bankruptcy or insolvency by or against a party that is not dismissed
within 60 days of its filing;

 

			
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	 	ii.	 	Appointment, with or without a party’s consent,
of a receiver or an assignee for the benefit of creditors;
	 
	 	iii.	 	Failure by Supplier to supply the OEM Products
in accordance with the material requirements of this Agreement;
	 
	 	iv.	 	Failure by GEMS-IT to purchase and pay for the
OEM Products in accordance with the provisions of this Agreement;
	 
	 	v.	 	Failure by Supplier to replace or repair
Noncomplying Products in a timely manner as required by Articles 5,
6 & 9 above; or
	 
	 	vi.	 	Other failure by a party to comply with any
material provision of this Agreement with additional failure to provide
the nonbreaching party, upon request, with reasonable assurances of
future performance.

	 	16.3	 	Rights Upon Breach. In addition to a party’s right to terminate this
Agreement upon breach, each party shall also have such other rights and remedies as may
be available to them at law or in equity or otherwise available under this Agreement.

	17.	 	CONFIDENTIAL INFORMATION

	 	17.1	 	Confidential Information. During the Term, a party (the “Recipient”)
may receive or have access to certain information of the other party (the “Discloser”)
that is marked as “Confidential Information,” including, though not limited to,
information or data concerning the Discloser’s products or product plans, business
operations, strategies, customers and related business information. The Recipient will
protect the confidentiality of Confidential Information with the same degree of care as
the Recipient uses for its own similar information, but no less than a reasonable
degree of care. Confidential Information may only be used by those employees of the
Recipient who have a need to know such information for the purposes related to this
Agreement. The parties acknowledge that all GEMS-IT Property, Technical Information
and Forecasts are deemed Confidential Information to be protected for a term of three
years from the date of disclosure.
	 
	 	17.2	 	Exclusions. The foregoing confidentiality obligations will not apply
to any information that is (a) already known by the Recipient prior to disclosure, (b)
independently developed by the Recipient prior to or independent of the disclosure, (c)
publicly available through no fault of the Recipient, (d) rightfully received from a
third party with no duty of confidentiality, (e) disclosed by the Recipient with the
Discloser’s prior written approval, or (f) disclosed under operation of law.

	18.	 	LIMITATION OF LIABILITY
	 
	 	 	UNLESS OTHERWISE STATED IN THIS AGREEMENT, NEITHER PARTY WILL BE LIABLE FOR ANY SPECIAL OR
CONSEQUENTIAL DAMAGES OF THE

 

			
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	 	 	OTHER ARISING OUT OF ANY PERFORMANCE OF THIS AGREEMENT OR IN FURTHERANCE OF THE PROVISIONS
OR OBJECTIVES OF THIS AGREEMENT, REGARDLESS OF WHETHER SUCH DAMAGES ARE BASED ON TORT,
WARRANTY, CONTRACT OR ANY OTHER LEGAL THEORY, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES. NOTWITHSTANDING THE ABOVE, SUPPLIER WILL BE RESPONSIBLE FOR ANY DAMAGES OF ANY
KIND INCLUDED IN AN AWARD OR SETTLEMENT OF A THIRD PARTY CLAIM UNDER ARTICLE 12
ABOVE AND SECTION 21.2 BELOW.
	 
	19.	 	TERMINATION

	 	19.1	 	Outstanding Orders. All Orders issued prior to the expiration of this
Agreement must be fulfilled pursuant to and subject to the terms of this Agreement,
even if the Delivery Dates are after expiration. Upon termination of this Agreement
for Supplier’s breach, GEMS-IT may cancel any outstanding Order or require Orders to be
fulfilled even if a Delivery Date is after the date of termination.
	 
	 	19.2	 	Surviving Provisions. Notwithstanding the expiration or early
termination of this Agreement, the provisions regarding Warranties in Article
9, Marketing and Licensing in Article 11, Intellectual Property in
Article 12, Confidentiality in Article 17, Limitation of Liability in
Article 18, and the Miscellaneous provisions below will each survive in
accordance with their terms.

	20.	 	CRISIS MANAGEMENT

	 	20.1	 	Communications. Supplier must maintain the ability to contact GEMS IT
on a 24 hour a day, 7 day a week basis in order to communicate and manage crisis
situations that threaten to or interrupt the Supply Chain. Likewise, Supplier must be
available if GEMS IT wishes to contact Supplier on a 24/7 basis. Means of
communication may include, but are not limited to, phone, mobile phone or pager and
interaction via email and the Internet.
	 
	 	20.2	 	Business Contingency Plan (BCP). Supplier must share with GEMS IT a
BCP that includes Supplier’s plan for 24/7 communication with GEMS IT. The BCP will
also include basic information on Supplier’s upstream Supply Chain. For instance, this
information will include who Supplier’s Tier 1 and Tier 2 suppliers are, where they are
located and the means of transportation for this Supply Chain.

	21.	 	MISCELLANEOUS

	 	21.1	 	Notices. All notices to be given under this Agreement must be in
writing addressed to the receiving party’s designated recipient. Notices are validly
given upon the earlier of confirmed receipt by the receiving party or three days or
seven days for international notices after dispatch by courier or certified mail,
postage prepaid, properly addressed to the receiving party. Notices may also be
delivered by telefax and will be validly given upon oral or written confirmation of
receipt.

 

			
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	 	 	 	Either party may change its address for purposes of notice by giving notice to the
other party in accordance with these provisions.
	 
	 	21.2	 	Indemnification. Supplier shall defend, indemnify, and hold harmless
GEMS-IT and its Affiliates from and against any losses, expenses, and liability
(including attorney fees) to third parties for any and all claims of personal injuries
and/or damages arising out of the use of any OEM Product if such injuries and/or
damages are attributable to any part of such OEM Product, provided that GEMS-IT
notifies Supplier promptly in writing of any and all such claims.
	 
	 	21.3	 	Exhibits. Each Exhibit attached to this Agreement is deemed a part of
this Agreement and incorporated herein wherever reference to it is made.
	 
	 	 	 	Exhibit A: OEM Products List
	 
	 	 	 	Exhibit B: Suppliers Prices
	 
	 	 	 	Exhibit C: Product Specifications
	 
	 	21.4	 	Independent Contractors. The relationship of the parties established
under this Agreement is that of independent contractors and neither party is a partner,
employee, agent or joint venturer of or with the other.
	 
	 	21.5	 	Assignment. Except for any assignment by GEMS IT to any Affiliate of
GEMS IT, neither this Agreement, nor any right, license, privilege or obligation
provided herein may be assigned, transferred or shared by either party without the
other party’s prior written consent, and any attempted assignment or transfer is void.
Any merger, consolidation, reorganization, transfer of substantially all assets of a
party, or other change in control or ownership will be considered an assignment for the
purposes of this Agreement (other than a merger of GEMS-IT with or into an Affiliate of
GEMS-IT). This Agreement will be binding on the successors and permitted assigns of
the parties and the name of the party appearing herein will be deemed to include the
names of such party’s successors or permitted assigns to the extent necessary to carry
out the intent of this Agreement.
	 
	 	21.6	 	No Waiver. The waiver of any term, condition, or provision of this
Agreement must be in writing and signed by an authorized representative of the waiving
party. Any such waiver will not be construed as a waiver of any other term, condition,
or provision except as provided in writing, nor as a waiver of any subsequent breach of
the same term, condition, or provision.
	 
	 	21.7	 	Reference To Days. All references in this Agreement to “days” will,
unless otherwise specified herein, mean calendar days.
	 
	 	21.8	 	Headings. The Section headings used in this Agreement are for
convenience of reference only. They will not limit or extend the meaning of any
provision of this Agreement, and will not be relevant in interpreting any provision of
this Agreement.

 

			
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	 	21.9	 	No Publication. Other than as required by SEC regulations which
require disclosure of certain material events, neither party may publicize or disclose
the terms of this Agreement to any third party, without the written consent of the
other party. Without limiting the generality of the foregoing sentence, no press
releases may be made without the mutual written consent of each party.
	 
	 	21.10	 	Severability. If any provision in this Agreement is held invalid or
unenforceable by a body of competent jurisdiction, such provision will be construed,
limited or, if necessary, severed to the extent necessary to eliminate such invalidity
or unenforceability. The parties agree to negotiate in good faith a valid, enforceable
substitute provision that most nearly affects the parties’ original intent in entering
into this Agreement or to provide an equitable adjustment in the event no such
provision can be added. The other provisions of this Agreement will remain in full
force and effect.
	 
	 	21.11	 	Entire Agreement. This Agreement comprises the entire understanding
between the parties with respect to its subject matters and supersedes any previous
communications, representations, or agreements, whether oral or written. For purposes
of construction, this Agreement will be deemed to have been drafted by both parties.
No modification of this Agreement will be binding on either party unless in writing and
signed by an authorized representative of each party.
	 
	 	21.12	 	Governing Law. This Agreement will be governed in all respects by the
laws of the State of New York without reference to any choice of laws provisions.
	 
	 	21.13	 	Dispute Resolution. Any claim or controversy arising out of or
relating to the Agreement must be submitted and settled as set forth in this Section
21.13. If any party to this Agreement alleges that any other party to this Agreement
has breached any of the terms of this Agreement, then the party alleging breach will
inform the other party of such breach in writing. Upon receipt of such notice, the
allegedly non-performing party will have 30 days to cure the alleged breach. If the
parties do not agree that effective cure has been accomplished by the end of the 30-day
period, then upon written request of any party, a senior manager from each party will
meet in person and confer in good faith to resolve the dispute within 15 days of the
expiration of the prior 30-day period. If, after the above procedure, the dispute
remains unresolved, either party may submit the dispute to the office of the American
Arbitration Association (“AAA”) located in Chicago, Illinois for binding arbitration in
accordance with the AAA’s Commercial Arbitration Rules then in effect, as amended by
this Agreement. The law applicable to the arbitration, including the administration
and enforcement thereof, is the Federal Arbitration Act, 9 U.S.C. §§ 1-16, as amended
from time to time. The cost of the arbitration, including the fees and expenses of the
arbitrator(s), will be shared equally by the parties, with each party paying its own
attorneys’ fees. The arbitrator(s) will have the authority to apportion liability
between the parties, but will not have the authority to award any damages or remedies
not available under the express terms this Agreement. The arbitration award will be
presented to the parties in writing, and upon the request of either

 

			
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	 	 	 	party, will include findings of fact and conclusions of law. The award may be
confirmed and enforced in any court of competent jurisdiction. Any post-award
proceedings will be governed by the Federal Arbitration Act. Nothing in this
Section 21.13 shall preclude either party from seeking interim equitable relief in
the form of a TRO or preliminary injunction. A request by a party of a court for
interim equitable relief shall not be deemed a waiver of the obligation to arbitrate
hereunder.
	 
	 	21.14	 	Insurance. During the term of this Agreement, Supplier shall maintain
at its own expense, commercial general liability insurance for bodily injury, death and
property loss and damage (including coverage’s for product liability, contractual
liability and personal injury liability) covering Supplier for claims, lawsuits or
damages arising out of its performance under this Agreement and any negligent or
otherwise wrongful acts or omissions by Supplier or any employee or agent of Supplier.
All such policies of insurance shall provide limits of liability in the minimum amount
of three million dollars ($3,000,000) per occurrence with an annual aggregate of at
least five million dollars ($5,000,000). Supplier shall provide GEMS IT with a copy of
certificates of insurance evidencing the existence of all coverage required hereunder.

*    *    *

IN WITNESS WHEREOF, the parties have caused this Agreement to be signed by their thereunto duly
authorized representatives as of the date first above written.

	 	 	 	 	 	 	 	 	 	 	 
	Cardiac Science, Inc.	 	 	 	GE Medical Systems

Information Technologies, Inc.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ RAYMOND W. COHEN
	 	 	 	By:
	 	/s/ MICHAEL GENAU
	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Printed Name: Raymond W. Cohen	 	 	 	Printed Name: Michael Genau	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Title: President & CEO	 	 	 	Title: Vice President & General Manager, Cardiology Systems	 	 

 

			
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EXHIBIT A

OEM PRODUCT LIST

1. Powerheart® model G3 automated external defibrillator (AED) to be produced in GEMS-IT
specified coloring and labeled GE Medical Responder® AED, is a portable battery operated automated
external defibrillator that analyzes a persons’ electrocardiogram and advises an operator to
deliver an electric shock(s) to a patient in order to restore normal heart rhythm; and includes
Cardiac Science’s patented STAR® biphasic technology, RHYTHMx® algorithms and RescueReady®
self-testing technology such as one button operation, pre-connected disposable electrode pads and
status indicator.

2. Single patient use disposable defibrillation electrodes for use with the AEDs and CRMs.
Electrodes will be packaged in to accommodate the RescueReady capabilities of the AED. Electrodes
for use with the CRMs will have a smart-chip-based coding system in the connector that mitigates
the possibility of the proprietary Electrodes being copied. Electrodes will be private-labeled
with GEMS-IT labeling as agreed upon by the Parties.

3. Powerheart® Cardiac Rhythm ModuleTM (CRM) is a portable external
defibrillator that (i) continuously monitors a patient’s electrocardiogram and is capable of
delivering an electric shock(s) using biphasic defibrillation technology to a patient in order to
restore normal heart rhythm; and (ii) performs synchronized cardioversion and external pacing; and
(iii) operates on an automatic, semi-automatic or manual basis. CRM with be private-labeled with
GEMS-IT specified labeling as agreed upon by the Parties.

 

			
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EXHIBIT B

SUPPLIER PRICES

	 	 	 	 	 
	OEM version AED Products	 	Price
	 
	GE Medical labeled Responder® AED
	 	$	[ * ]	 
	(Corresponds to Cardiac Science Powerheart® AED G3)
	 	 	 	 
	 
	 	 	 	 
	Primary AED Accessories:
	 	 	 	 
	G3 Molded carry case for AED G3 (part no. 168-6000-001)
	 	$	[ * ]	 
	G3 AED Replacement Electrodes for G3 (part no. 9131)
	 	$	[ * ]	 
	G3 AED Pediatric Electrodes (part no. 9730)
	 	$	[ * ]	 
	Wall-Mount Wire Rack (part no. 164-2191)
	 	$	[ * ]	 
	G3 Wall-Mount Storage & Display Case without Alarm (part no. tbd)
	 	$	[ * ]	 
	G3 Wall-Mount Storage & Display Case with Alarm (part no. tbd)
	 	$	[ * ]	 
	G3 Powerheart® AED Trainer device (part no. 180-3000-001)
	 	$	[ * ]	 

Each Responder AED package includes (model G31):

One (1) each Automated External Defibrillator with extended life lithium battery, a pair of
defibrillation electrodes, serial communication cable and a CD containing RescueLink® download
software and instructions, User’s Manual and training video.

Each Pediatric Electrode package includes:

One (1) each MDLink® software and Users Manual and a pair of pediatric defibrillation electrodes.

	 	 	 	 	 
	CRM Products	 	Price
	 
	GE Medical labeled Powerheart® CRM
	 	$	[ * ]	 
	 
	 	 	 	 
	Primary CRM Accessories:
	 	 	 	 
	CRM Disposable Therapy Electrodes (part no. 170-2007)
	 	$	[ * ]	 
	(packaged 10 sets per box)
	 	 	 	 
	CRM Portable Carry Case (part no. 168-1020-001)
	 	$	[ * ]	 
	Wall Mount (part no. 168-2003)
	 	$	[ * ]	 
	IV Pole Mount (part no. 168-2011)
	 	$	[ * ]	 
	Pass-Thru Cable for GE Medical monitors (part no. 170-2089)
	 	$	[ * ]	 

Each CRM package includes (model 2.0 with handle):

One (1) each CRM defibrillator device with rechargeable sealed lead acid battery, a pair of CRM
Defibrillation Electrodes, AC Power Adaptor (part no. 139-0186) and Power Cord (part no. 167-0102),
set of Patient Therapy Cable (part no. 162-0058), 3-lead ECG Patient Cable (part no. 162-0057), set
of 3-lead ECG Monitoring Electrodes, Event Review Kit with CD-ROM of Event Review Software and CRM
to PC cable (part no. 109-2000-001), Operators Manual, Quick Reference Guide and training video.

All prices are in US Dollars (USD).

 

			
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EXHIBIT C

Powerheart AED Technical Specifications

[ * ]

 

			
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25

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