Option and Distribution Agreement

Exhibit 10.9

Option and Distribution Agreement

This Option and Distribution Agreement (“Agreement”) is made as of September 20, 2002 between Sutura, Inc. (“Supplier”) a California corporation, having its principal place of business at 17080 Newhope Street, Fountain Valley, CA 92708 and Getz Bros. & Co., Inc. (“Distributor”) a Delaware corporation, located at 225 West Washington Street, Suite 1900, Chicago, IL 60606.

In consideration of the mutual promises contained herein, Supplier and Distributor agree as follows:

(a) “Products” means those products listed in Exhibit A attached hereto, as that Exhibit may be amended to include any and all new products manufactured or distributed by Supplier within the field of vascular closure and also to exclude those products as may be discontinued by Supplier.

(b) “Territory” means Japan.

(c) “Promissory Note” means the Convertible Promissory Note dated September 20, 2002 between the parties and attached hereto as Exhibit B.

(a)  Distribution Option: Distributor shall have an exclusive option to enter into an exclusive distribution agreement with Supplier for the Products in Japan. The terms of the distribution agreement for Japan shall be as set forth in this Agreement. Distributor’s right to exercise such option shall expire at 11:59 p.m., Chicago time, on March 31, 2004. The term of such distribution agreement shall commence thirty (30) days after the date on which Distributor gives notice to Supplier that it is exercising its option. The prices at which Distributor buys Products from Supplier hereunder shall be as agreed between the parties subject to the provisions hereof and provided that such pricing shall be such that Distributor can earn a minimum gross profit (as defined in Section 3(b) below) of at least forty (40) percent of the existing reimbursement price published periodically by the Japanese Ministry of Health, Labor and Welfare (herein “MHLW”).

(b)  Convertible Note: Upon execution of this Agreement Distributor shall pay to Supplier one million dollars ($1,000,000) in exchange for the Promissory Note. Upon exercise of the Distribution Option provided in subsection (a) above, the Promissory Note shall be converted into an advance payment (“Advanced Payment”) for Products fully creditable against Distributor’s future purchases of Products. In the event Distributor elects not to exercise the Distribution Option, Supplier agrees to repay Distributor as provided in the Promissory Note.

(a)  Appointment: Subject to the terms and conditions of this Agreement, upon Distributor’s exercise of its option under Section 1A above, Supplier hereby appoints Distributor, and Distributor accepts that appointment, as Supplier’s exclusive distributor of the Products in the Territory.

(b)  Independent Contractors: Distributor and Supplier are independent contractors and are engaged in the operation of their own businesses. Neither party is to be considered the agent of the other party for any purpose whatsoever, and neither party has any authority to enter into any contracts or assume any obligations for the other party or make any warranties or representations on behalf or the other party unless agreed to in writing by the other party.

(a)  Registration and Marketing of Products: Distributor agrees, at its expense, to use its best efforts to investigate, obtain government approval for, promote, and distribute the Products, in the Territory upon execution of this Agreement, using generally the same channels and methods, exercising the same diligence and adhering to the same standards which it employs for other medical application products sold by Distributor, as well as any of Distributor’s own products. In addition, Distributor agrees to pursue regulatory approval and reimbursement for Supplier’s Products in the Territory in accordance with the local laws and regulations, provided that Supplier provides the required data and information to comply with the MHLW.

(b)  Minimum Performance Levels: Distributor agrees to purchase the number of units of Products per calendar year during the term of this Agreement (beginning with the first date of promoted sales of Products by Distributor in the Territory) as agreed between the parties; provided, however, that such minimum performance levels shall be appropriately adjusted by Supplier and Distributor if: (i) one or more events of force majeure affect Distributor’s ability to meet such, levels; (ii) Supplier is unable or refuses to sell Products to Distributor when Distributor orders them; (iii) Products are deleted from this Agreement, (iv) Product registrations are delayed or denied by local governing agencies through no fault of Distributor, (v) Supplier is unable or refuses to supply reasonable data or information to comply with local governing agencies, (vi) approval for Product reimbursement is delayed or denied by local governing agencies, or (vii) Product reimbursement levels established by government regulatory authorities in the Territory do not allow Distributor to realize a minimum gross profit (defined as revenues from sales of Products less Product costs, as well as taxes and shipping expenses incurred in connection therewith) of

forty (40) percent based on existing Supplier pricing. If Distributor and Supplier do not agree on acceptable minimum performance levels for any given year prior to the commencement of such year, Supplier shall have the right to terminate the Agreement; provided, however, the percentage increase in minimum performance levels for any year will not be greater than seven (7) percent over the previous year’s minimum performance level unless mutually agreed upon.

(c)  Reports: Distributor agrees to submit regular reports to Supplier on a quarterly basis (unless otherwise agreed) accurately describing sales of the Products by Distributor for the previous period (including prices, unit sales, and other information as may be reasonably requested by Supplier from time to time).

(d)  Product Complaints: Distributor agrees to report to Supplier all available information concerning any product complaints that it is aware of. This information will be reported in order to assist Supplier in monitoring the quality and safety of its Products, and to allow Supplier to meet its reporting obligations under the United States Medical Device Reporting regulations (21 CFR 803.24) and Medical Device Vigilance Guidelines. Information concerning product complaints may be reported to the Supplier in either verbally or in writing. A “product complaint’ is any written or oral expression of dissatisfaction as to the identity, quality, durability, reliability, safety, effectiveness, or performance of a Product. Product complaints associated with a death or serious injury, or a malfunction that could reasonably be expected to result in a death or serious injury if the malfunction recurs, will be reported to Supplier immediately upon Distributor’s knowledge of that information.

(e)  Prohibited Sales: Distributor agrees not to sell, and agrees to use reasonable efforts to ensure that Distributor’s subdistributors, agents and customers do not sell or use, any of the Products outside the Territory.

(f)  Product Presentation: Distributor agrees to present the Products fairly to potential customers, not to disparage the Products, any Product trademarks or Supplier and to do all things reasonable to promote the reputation of the Products and the value of any Product trademarks.

(g)  Non-Compete: Upon Distributor’s exercise of its option under Section 1A above, Distributor agrees not to license, manufacture, sell, or distribute any product, which competes with Supplier’s Products. Notwithstanding, Distributor reserves the right to distribute percutaneous closer devices manufactured by Perclose, Inc. (an Abbott Laboratories company) in the Territory until Distributor sells any remaining inventory, provided however, Distributor sells any remaining inventory within ninety (90) days from the date set forth in Section 1A above.

(a)  Requirements of Distributor: Supplier agrees to supply Distributor’s requirements for the Products in the Territory consistent with Distributor’s non-binding forecasts of its expected requirements for the Products. If Supplier believes it will not be able to satisfy Distributor’s requirements for the Products, it must promptly notify Distributor, specifying the reasons for and duration of the expected delay and its duration at the time Product order is placed.

(b)  Registration and Marketing Support: To assist Distributor in registering and marketing the Products in the Territory, Supplier agrees to:

(i) Provide Distributor with materials necessary to obtain health registrations. Supplier will supply to Distributor the required quantity of samples, at a price equal to Supplier’s cost of goods, to obtain registration approval.

(ii) Provide Distributor with information on marketing and promotional plans of Supplier for the Products as well as copies of marketing advertising, sales, technical training manuals, and available audiovisual teaching and marketing aides and promotional literature concerning the Products.

(iii) Provide Distributor with certain certificates of analysis concerning the Products purchased by Distributor, certificates of free sale, trademark authorizations and any other documents which Distributor may require for registration purposes.

(a)  Terms of Orders: All purchases of the Products by Distributor from Supplier during the term of this Agreement will be subject to the terms and conditions of this Agreement.

(b)  Packaging: All quantities of the Products purchased from Supplier by Distributor will be in the form of labeled, standard unit packages and in a form and formulation consistent with the Products sold by Supplier for use in the United States, unless otherwise agreed by Supplier and Distributor in writing.

(c)  Price and Payment: The prices for the Products to Distributor are set forth in Exhibit A attached hereto. The prices are valid for a minimum period of twelve (12) months, unless mutually agreed otherwise in writing. Ninety (90) days advance written notification is required for price increases by Supplier.

(d)  Resale Price: Distributor may