IceCure Medical Ltd. announced that its wholly-owned subsidiary, IceCure (Shanghai) MedTech Co. Ltd. signed an exclusive distribution agreement for IceSense3 cryoablation systems with Shanghai Medtronic Zhikang Medical Devices Co. Ltd., an affiliate of Medtronic plc and Beijing Turing Medical Technology Co. Ltd. The first IceSense3 systems are expected to be delivered in 2022. Shanghai Medtronic will be the exclusive distributor of the IceSense3 and its disposable probes in mainland China for an initial period of three years, with minimum purchase targets of $3.5 million for this period. Additionally, in mainland China, Shanghai Medtronic will not directly or indirectly invest or deal in, market, sell, promote or provide services to any product that competes with the IceSense3, during the term of the distribution agreement and for a period of six (6) months thereafter. While Shanghai Medtronic conducts all marketing, sales, and certain professional training, Turing will be responsible for the import, installation, and after-sales service of IceSense3 systems in mainland China. The IceSense3 system console is approved by the National Medical Products Administration ("NMPA") of China. Having submitted an amendment application to the registration certificate for approval of the disposable probes, which, if approved, will allow the Company to sell its disposable IceSense3 Cryoprobes for commercial use, IceCure expects to receive NMPA approval for the probes by the end of 2022. On June 12, 2022 (the "Effective Date"), IceCure Shanghai signed an exclusive sale and distribution agreement (the "Distribution Agreement") for the IceSense3 and disposable probes (the "Products") with Shanghai Medtronic and Turing for an initial term of 36 months, with a minimum purchase target of $3.5 million (the "Minimum Puchase Target") within this term. Pursuant to the Distribution Agreement, IceCure Shanghai will sell the Products to Turing, which will import the Products from Israel to mainland China, and resell them to Shanghai Medtronic. Shanghai Medtronic will be responsible for, among other matters: (i) marketing and promoting the Products within mainland China; and (ii) holding professional medical education events for the Products within
mainland China. Turing will be responsible for warehousing, logistics, warranty services, training, and other support and after sale services. Under the terms of the Distribution Agreement, if Shanghai Medtronic meets the accumulated three-year Minimum
Purchase Target, it will then have the right to extend the term of the Distribution Agreement for three consecutive years subject to an agreement on a new Minimum Purchase Target. The Distribution Agreement may be terminated in certain circumstances, including in the event of default, material breach or insolvency. Furthermore, under the Distribution Agreement's terms, IceCure Shanghai will be responsible for obtaining and maintaining any and all regulatory approvals in mainland China required for marketing, promotion, distribution, sale and use of the Products ("Regulatory Approvals"), issued by mainland China's NMPA, its local branches or any other government authorities ("Regulatory Agencies"). IceCure Shanghai has already obtained Regulatory approvals for the IceSense3 system consoles and is required to obtain Regulatory Approvals for the disposable IceSense3 Cryoprobes for commercial procedures within nine months of the Effective Date of the Distribution Agreement. If IceCure Shanghai fails to obtain the Regulatory Approvals for the Cryoprobes by such time, Shanghai Medtronic has the right to terminate the Distribution Agreement.