EXCLUSIVE DEVELOPMENT, SUPPLY AND DISTRIBUTION AGREEMENT
THIS EXCLUSIVE DEVELOPMENT, SUPPLY AND DISTRIBUTION AGREEMENT ("Agreement") is
made and entered into effective as of June 23, 2005 (the "Effective Date") by and between Genesee BioMedical,
Inc., a corporation organized under the laws of the state of Colorado ("GBI"), with an address at 1308 South
Jason Street, Denver, Colorado 80223, and ATS Medical, Inc., a Minnesota corporation ("ATS"), with an
address at 3905 Annapolis Lane, Minneapolis, Minnesota 55447, (hereinafter sometimes individually or
collectively referred to as a "Party" or the "Parties," respectively).
A. ATS and GBI are engaged in the design, development, manufacture and sale of products for use in cardiac
B. GBI has special knowledge and expertise relating to the design, development and manufacture of cardiac
surgical products, including annuloplasty repair rings, c-rings and accessories, and ATS has a distribution
network that is capable of marketing and selling such products.
C. ATS and GBI previously agreed in principal to certain non-binding terms and conditions regarding the
development of the Products (the "Term Sheet") and after executing the Term Sheet market input data generated
by the Parties' investigations have affected certain commercial considerations reflected in the Term Sheet.
D. GBI desires to manufacture the Products for ATS and to supply such quantities of Products as ATS desires,
and ATS desires to obtain from GBI a supply of the Products after it has complied with the necessary FDA
requirements so that ATS can exclusively distribute the Products worldwide.
E. ATS and GBI desire to formalize their relationship by entering into this Exclusive Development, Supply and
Distribution Agreement for the purpose of developing, manufacturing, supplying and distributing the Products, on
the terms set forth in this Agreement.
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual representations, warra