SUPPLY AGREEMENT

THIS AGREEMENT, made on this 19th day of December 2012 (the “Effective Date”), by and between Santec Corporation, a corporation organized and existing under the laws of Japan with its principal office at 5823 Ohkusa-Nenjozaka, Komaki, Aichi ###-###-#### Japan (hereinafter referred to as “Supplier”) and Volcano Corporation, a corporation organized and existing under the laws of the state of Delaware with its principal office at 3661 Valley Centre Drive Suite 200 San Diego, CA 92130 (hereinafter referred to as “Customer”).

WHEREAS, Supplier manufactures and sells certain 100 kHz Scanning Laser whose Supplier’s part number is […***…] (“Products,” as more specifically defined below);

WHEREAS, Customer desires to purchase Products from Supplier and to incorporate the Products into the Customer Product;

WHEREAS, Products include valuable trade secrets and know-how of Supplier;

WHEREAS, a subsidiary of Customer engages in developing and manufacturing scanning laser competitive with Products; and WHEREAS, notwithstanding the foregoing, Supplier is willing to sell Products to Customer subject to confidentiality obligations and purchase commitment of Products and other terms and conditions provided herein.

NOW, THEREFORE, in consideration of the covenants and conditions contained herein, the parties hereto agree as follows:

When used in this Agreement, the following terms shall have the meanings indicated in this Article.

“Affiliate” of a certain entity means any entity more than 50% of whose equity interest is held or controlled directly or indirectly by such entity, or who holds or controls directly or indirectly more than 50% of equity interest in such entity.

“Annual Blanket Order” shall have the meaning set forth in Article 2.2.1.

“Committed Products” mean Products covered by an Annual Blanket Order to be placed by Customer under Article 2.2.1 including Products to be purchased by Customer under Qualified Additional Orders as defined in Article 2.2.2, which shall be deemed as increase of the quantity of an Annual Blanket Order. Committed Products shall include neither Initial Products nor Spot Products.

“Confidential Information” means any and all information disclosed in the course of implementation of this Agreement by Disclosing Party to Receiving Party which information is designated in writing as confidential by Disclosing Party at the time of disclosure; provided, however, that Confidential Information shall not include any information which:

In addition, design, specification, manufacturing processes and any other similar information obtained from Products or samples or prototypes thereof shall constitute Confidential

Information of Supplier, regardless of whether Supplier designate such information as confidential.

“Conflict Minerals” means columbite-tantalite (coltan), cassiterite, gold, wolframite or their derivatives, tantalum, tin and tungsten and any other minerals or derivatives that the United States Secretary of State determines after the date hereof to be financing conflict in a Covered Country, and “Conflict Mineral” shall mean any of them.

“Covered Countries” means the Democratic Republic of the Congo and its adjoining countries, including, as of the date hereof, Angola, Burundi, Central African Republic, the Republic of the Congo, Rwanda, South Sudan, Tanzania, Uganda and Zambia, and “Covered Country” shall mean any of them.

“Customer Product” means Customer’s OCT (optical coherence tomography) system for use in intracoronary imaging, including, without limitation, any improvements, updates and upgrades to such product.

“Delivery Schedule Table” means a table setting forth quantity of Committed Products to be delivered in each month during the applicable Fiscal Year.

“Design Files” has the meaning set forth in Section 5.7.

“Disclosing Party” referred in connection with certain Confidential Information means the party who discloses such Confidential Information to Receiving Party.

“FDA” shall mean the United States Food and Drug Administration and any successor agency thereto.

“Fiscal Quarter” means each three month period commencing April 1, July 1, October 1 or January 1 of each Fiscal Year.

“Fiscal Year” means each one year period commencing on April 1 and ending on March 31 of the following year.

“Individual Contract” means a contract for individual sale and purchase of specific Products to be entered by and between the parties in accordance with the order and acceptance procedures provided in Article 2.

“Initial Products” mean the initial […***…] units of the Products to be sold by Supplier purchased by Customer under Article 2.1 of this Agreement.

“Latent Defect” means a defect that causes a Product to not conform to the Product Warranty, which defect is not discoverable upon reasonable physical inspection.

“Minimum Delivery Quantity” means the minimum quantity of each delivery of Products (other than the Initial Products) under this Agreement. The parties hereby agree that the Minimum Delivery Quantity is […***…] units.

“Minimum Aggregate Purchase Quantity” means the minimum quantity of Products which Customer is required to purchase from Supplier during the entire term of this Agreement.

“Minimum Purchase Quantity” means the minimum quantity of Products which Customer is required to purchase from Supplier during a certain Fiscal Year.

“Per-Unit Price” means per-unit price of Products purchased under a certain Individual Contract.

“Products” mean 100 kHz Scanning Laser of Supplier sold to Customer hereunder whose part number in Supplier is […***…]; provided that if Supplier releases new versions of […***…] or new products with functionality similar to […***…], such new versions or new products shall be included in Products on the condition that the parties have reached a written agreement on the pricing and specification of such new versions or new products.

“Qualified Additional Orders” shall have the meaning ascribed in Article 2.2.2.

“Receiving Party” referred in connection with certain Confidential Information means the party who receives such Confidential Information from Disclosing Party.

“Quality Standards” means the standards and regulations related to the implementation, conduct and maintenance of quality controls, set forth in Annex 2.

“Related Parties” of a certain party means:

“Recycled Sources” means recycled metals, which are reclaimed end-user or post-consumer products, or scrap processed metals created during product manufacturing, including excess, obsolete, defective, and scrap metal materials which contain refined or processed metals that are appropriate to recycle in the production of tin, tantalum, tungsten and/or gold, but excluding minerals partially processed, unprocessed or a by-product from another ore.

“Specification” means the specification of Products set forth in the Detailed Specification attached hereto as Annex 1.

“Spot Order” shall have the meaning ascribed in Article 2.3.

“Spot Products” mean Products ordered under a Spot Order.

“Taxes” mean any value-added taxes, consumption, sales or use tax, duty or tariff (now or hereafter enacted), excise, ad valorem, stamp, documentary and other taxes, or other similar taxes or charges imposed by governmental authorities (e.g., national governments, local governments, and customs) relating to Products.

Article 2.    Order and Order Acceptance

* Per-Unit Price shall be adjusted based on the quantity in accordance with Article 2.2.3.

**[…***…] units do not include Initial Products to be delivered during Fiscal Year 2013.

***Subject to adjustment under Article 2.4.

shall be treated as increase of the quantity of such Annual Blanket Order. Other additional orders shall be treated as Spot Orders under Article 2.3.

No Qualified Additional Orders shall bind Supplier unless and until finally confirmed and accepted by Supplier’s written confirmation; provided that Supplier shall be obligated to confirm and accept the Qualified Additional Orders properly submitted by Customer pursuant to this Article. Upon acceptance of an order by Supplier, an Individual Contract for the Products so ordered shall be formed and become irrevocable and binding.

The same Per-Unit Price as Committed Products ordered under the Annual Blanket Order shall be applied to Committed Products ordered under such Qualified Additional Orders for the same Fiscal Year, subject to price revision in accordance with Article 2.2.3.

If (i) Customer places Qualified Additional Orders for a certain Fiscal Year after the commencement of such Fiscal Year, and (ii) the Per-Unit Price determined by applying the Volume Pricing Table below to the increased quantity of the Committed Products for such Fiscal Year is lower than the then-current Per-Unit Price, the Per-Unit Price of all the Committed Products for such Fiscal Year shall be retroactively revised to the Per-Unit Price determined by applying the Volume Pricing Table below. If Customer has already paid the price for certain Committed Products for such Fiscal Year, the difference between the price paid by Customer and the price calculated based on the revised Per-Unit Price shall be treated as the credit against future payments by Customer to Supplier.

Notwithstanding the foregoing, […***…] units of the Initial Products to be delivered during Fiscal Year 2013 shall be added to the quantity of the Committed Products for Fiscal Year 2013 solely for the purpose of the revision under this Article of the

Per-Unit Price of the Committed Products for Fiscal Year 2013. For example, if Customer places the Annual Blanket Order for the Fiscal Year 2013 in the quantity of […***…] and a Qualified Additional Order of […***…] units, (i) the Per-Unit Price for […***…] units of the Initial Products to be delivered during the period from April through September 2013 shall remain unchanged, (ii) the Per-Unit Price of (a) the […***…] units ordered under the Annual Blanket Order and (b) the […***…] units ordered under the Qualified Additional Order shall become $[…***…], which is the pricing for the annual purchase of […***…] units (i.e., the total of […***…] units of the Initial Products, […***…] units ordered under the Annual Blanket Order and […***…] units ordered under the Qualified Additional Order) under the Volume Pricing Table below.

for less than […***…] units shall not exceed $[…***…]. Customer acknowledges that lead time for a Spot Order may be longer than the standard lead time of Supplier (i.e., 8 weeks for […***…] units, 12 weeks for […***…] units, 16 weeks for […***…] units and 20 weeks for […***…]-). Upon acceptance of a Spot Order by Supplier, such Spot Order shall become irrevocable, and Supplier shall become obliged to sell, and Customer shall become obliged to purchase, the Spot Products ordered under such accepted Spot Order at the Per-Unit Price, lead-time and delivery schedule so agreed between the parties.

If, as a result of decrease of the Minimum Purchase Quantity for a Fiscal Year, the Per-Unit Price determined by applying the Volume Pricing Table of Article 2.2.3 to the quantity of the Committed Products ordered for such Fiscal Year is higher than the Per-Unit Price for such Fiscal Year set forth in the Minimum Purchase Quantity Table of Article 2.2.1, the Per-Unit Price of Committed Products for such Fiscal Year shall become the Per-Unit Price determined by applying the Volume Pricing Table of Article 2.2.3 to the decreased Minimum Purchase Quantity.

subject to the parties agreeing on pricing and purchase commitments therefor, which terms will be negotiated in good faith.

Article 3.    Payment Terms

Article 4.    Delivery of Products

Supplier shall deliver Spot Products in accordance with the delivery schedule to be agreed in accordance with Article 2.3.

Article 5.    Manufacture

undertakes pursuant to this Agreement. Supplier shall be responsible for all acts and omissions of any of its subcontractors and shall ensure that its subcontractors comply with all of the terms of this Agreement. Supplier shall immediately notify Customer of any change in the manufacturing process or the equipment, facility or materials used in the manufacture of Product.

obligations as provided in Article 11 with respect to information obtained in the course of such audit; provided that Supplier may limit access by quality assurance representatives of Customer from Supplier’s design history files for the Products (the “Design Files”). Quality assurance representatives of Customer shall not take any records of such audit except for recording of status of compliance with, or deviation from, Quality Standards, and submit to Supplier any and all records taken in the course of such audit. Each such audit shall be conducted during normal business hours. In the event that the audit by Customer reveals any noncompliance issues, Supplier will use diligent and good faith efforts to promptly correct them, which efforts shall include promptly developing a correction plan (including timelines for corrections), working with Customer in good faith to agree upon the correction plan, and complying with said plan; provided that such correction efforts shall not waive any rights or remedies of Customer with respect to such noncompliance.

Such records (including copies thereof) shall be considered the Confidential Information of Supplier.

Article 6.    Warranty

such party, or of any law, rule, regulation, authorization or approval of any government entity, or of any agreement to which it is a party or by which it is bound.

and will make best efforts to supply the remainder of replacement Products requested as soon as possible from the notice of rejection. Within 3 days after receiving any notice of rejection from Customer, Supplier will respond stating whether (a) it accepts the rejection or (b) it disputes the rejection, in which case the parties will refer such dispute to a mutually acceptable independent third party with the appropriate expertise to assess the conformity or nonconformity of the rejected Product to the Product Warranty. Such independent third party will examine or test the applicable Product and determine whether such Product conformed or did not conform to the Product Warranty. The parties agree that such third party’s determination shall be final and binding upon the parties. The party against whom the independent third party rules shall bear the costs of testing by such independent third party, and if such third party determines that Customer’s rejection of the Product was incorrect, Customer will purchase and pay for both the initially rejected Product and the replacement Product. If the parties cannot agree on the determination of such independent third party, either party may refer to the arbitration under Article 13.7 solely the issue of promptly appointing an independent third party under this Section 6.5, and the parties will cooperate in good faith to expedite such matter.

Article 7.    Taxes

Article 8.    Regulatory

that are imposed by applicable law upon Customer as the manufacturer of Customer Products or as the holder of any regulatory approval for Customer Products. Supplier shall, on a timely basis, provide Customer with information in Supplier’s possession relevant to its role as the manufacturer of Product that is reasonably necessary for and relevant to Customer’s obligations hereunder in complying with such regulatory requirements. Supplier will provide to Customer such documentation, data and other information relating to Product as Customer may require for submission to governmental authorities.

Customer may, at its option, choose to have Supplier reimburse Customer for the price of such Products.

Notwithstanding the foregoing, the cumulative total of Supplier’s liabilities (including costs incurred by Supplier to comply with the obligations under this Section 8.3 such as supply of replacement Products and replacement parts) for all the recalls with respect to Products supplied under this Agreement shall not exceed the cumulative total of amounts received by Supplier from Customer under this Agreement.

affect the quality of the Product that Supplier is obligated to deliver hereunder or its ability to meet delivery date obligations hereunder. Supplier shall promptly investigate such incident or accident and provide a written report within five (5) business days of the results of the investigation of such incidence or accident to Customer.

Article 9.    Term and Termination

The party terminating this Agreement under this Article may claim damages for such termination against the party which falls under any of the foregoing Items (i) through (vi).

Article 10.    Survival

The provisions of Articles 1, 5.8 and 6 through 13 shall survive the termination or expiration of this Agreement. In addition, any monetary claims and liabilities accrued under this

Agreement prior to the termination or expiration of this Agreement survive the termination or expiration of this Agreement.

Article 11.    Confidentiality

into a written agreement with the Receiving Party to keep such information confidential in a manner consistent with this Agreement.

Article 12.    Indemnification; Insurance.

hereunder promptly after the indemnified party has knowledge of such claim; (b) permitting the indemnifying party to assume full responsibility to investigate, prepare for and defend against any such claim or demand; (c) assisting the indemnifying party, at the indemnifying party’s reasonable expense, in the investigation of, preparation for and defense of any such claim or demand; and (d) not compromising or settling such claim or demand without the indemnifying party’s written consent.

Article 13.    Miscellaneous

If to Supplier:    Santec Corporation

Address: 5823 Ohkusa-Nenjozaka, Komaki, Aichi ###-###-#### Japan

Attention: Changho Chong

Telephone: +81-#

Facsimile: +81-#

e-mail: ***@***

If to Customer:    Volcano Corporation

Address: 3661 Valley Centre Drive, Suite 200

San Diego, CA 92130

Attention: Darin Lippoldt, General Counsel

Telephone: 858 ###-###-####

Facsimile: 858 ###-###-####

e-mail: ***@***

THE OTHER PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

EXCEPT WITH RESPECT TO WILLFUL MISCONDUCT, THE AGGREGATE AMOUNT OF THE LIABILITIES OF EACH PARTY ARISING UNDER ARTICLES 6, 8 AND 12 SHALL NOT EXCEED THE CUMULATIVE TOTAL OF AMOUNTS RECEIVED BY SUPPLIER FROM CUSTOMER UNDER THIS AGREEMENT.

accordance with the then-current Rules of Conciliation and Arbitration of the International Chamber of Commerce if initiated by Supplier, or in Tokyo, Japan in accordance with the then-current Commercial Arbitration Rules of Japan Commercial Arbitration Association if initiated by Customer. The award of the arbitration shall be final and binding upon the parties. Judgement upon such award may be entered in any court having jurisdiction thereof. The language to be used in the arbitral proceedings shall be English.

IN WITNESS THEREOF, the duly authorised representatives of the parties hereto have caused this Agreement to be executed as of the day and year first above written.

Supplier:

Customer:

1.REGULATORY AND ACCREDITATION

Supplier must maintain compliance to the relevant aspects of the following international safety and test standards:

And all applicable related IEC collateral standards.

Supplier shall maintain compliance with IEC 62304, IEC 12207 or a substantially equivalent set of software development lifecycle processes, unless Supplier declares, and represents and warrants to Customer, that Products contain no software, meaning a set of program instructions intended to be executed by a shared set of interpretation and execution resources including but not limited to embedded software, microprocessor programs and microcontroller programs, regardless of whether:

The above definition of software is understood to be distinct from hardware such as analog electronics circuits, digital electronics circuits, or digital or mixed-signal electronics implemented in programmable logic devices such as FPGAs.

And such product standards as may be included in or referenced by the Product specification in Annex 1.

The performance of the EMC Sample Unit is set forth in the following reports: 11/11/2012 – EMC Findings for […***…], Serial Number […***…], and 11/14/2012 – EMC Immunity Findings for […***…], Serial Number […***…].

2.    AUDIT

Customer shall conduct QA audits in accordance with Section 5.7 of the main body of this Agreement after the execution of this Agreement to check that Supplier has adopted and established a quality management system conforming to ISO 9001 quality management system and appropriate international standards. The first QA audit is estimated to occur in January 2013.

Customer shall make reasonable good-faith efforts to assist Supplier in solving such non-compliances by providing advice and guidance as appropriate.

Supplier shall comply with the terms and schedules of any corrective action plans agreed as described above, and shall provide status updates to Customer as and when requested. Customer shall promptly review objective evidence provided by Supplier, and if necessary conduct QA Audits in accordance with Section 5.7 of the main body of this Agreement, to verify that Supplier’s manufacturing processes and quality management system address any non-compliances identified as described above.

3.    INTERNAL PROCESSES

4.    PART/LOT TRACEABILITY

Serial Numbers. Each Product will be marked with a serial number. Supplier’s processing records shall be maintained at all times by serial number. Traceability must be maintained to all raw materials used, testing performed, employee performing activities and dates of performance of activities either on a lot by lot basis or individually with respect to all parts except for minor parts of limited importance listed in Schedule 1 to Annex 2. Supplier must maintain a system to ensure that serial numbers are unique. Supplier must maintain compliance to the Conflict Minerals requirement for these and all other raw materials used.

5.    QUALITY ASSURANCE

requirements. Supplier must similarly obtain and retain CoA from its suppliers for all raw materials used in manufacture of Customer parts.

6.    PROCESS CHANGE CONTROL

All processes used to manufacture Customer parts require process approval and are to remain frozen upon approval. Any change in procedure, equipment, material, tooling, handling, etc. shall require written change approval from Customer prior to further processing.

7.    NONCONFORMING PRODUCT

8.    PACKAGING

Finished goods to be individually packaged appropriately and labeled as required and provided in Certification of Analysis.

(a)    Supplier shall ensure that all Conflict Minerals used in the Products, if any: (i) originate in countries other than the Covered Countries, (ii) are processed in smelters or refineries that are, as of the date such Conflict Minerals are transferred from such smelter or refinery to Supplier (or to Supplier’s supplier, if applicable), designated as “conflict-free” or a similar designation (A) by a third party recognized in the industry for providing such designations (such as the Electronic Industry Citizenship Coalition and Global e-Sustainability Initiative Conflict Free Smelter Program) or (B) pursuant to an independent third-party audit, the results of which are made publicly available by such smelter or refinery, or (iii) come from Recycled Sources. Within thirty (30) days following the end of each calendar year during the term of this Agreement, Supplier shall provide Customer with a certificate, signed by a responsible officer of Supplier, certifying that either (i) no Conflict Minerals were used in any Products manufactured for Customer during the immediately preceding calendar year or (ii) in the event any Conflict Minerals were used in Products manufactured for Customer during the immediately preceding calendar year, Supplier was, at all times during such calendar year, in full compliance with its obligations set forth in this Annex 3. In addition, Supplier shall, at Customer’s request at any time during the term of this Agreement (but not more than once in any calendar quarter), promptly provide Customer with a certificate, signed by a responsible officer of Supplier, certifying as to Supplier’s then-current compliance with its obligations set forth in this Annex 3. Supplier shall include identical provisions to those set forth in this Annex 3, subsection (a) (including a requirement to provide officers’ certificates as evidence of compliance with such provisions) in any supply agreements pursuant to which Supplier obtains Conflict Minerals, or materials containing Conflict Minerals, that are used in the Products, and Supplier shall diligently monitor its suppliers’ compliance with such provisions (including by obtaining the applicable officers’ certificates when required) and obtain certificates of origin or other written assurances from its suppliers, if applicable, regarding the origin of any Conflict Minerals used in the Products. Supplier shall promptly notify Customer in writing of any breach of

this paragraph (including any failure of Supplier to ensure that all Conflict Minerals used in the Products satisfy at least one of clauses (i), (ii) or (iii) of the first sentence of this paragraph) and shall take all actions reasonably requested by Customer to remedy such breach.

(b)    Schedule 1 to this Annex 3 sets forth, as of the date hereof, all Conflict Minerals that are used in, or that Supplier expects to be used in, the Products and, with respect to each such Conflict Mineral, (i) the facility in which such Conflict Mineral is processed, and whether such facility has been designated as “conflict-free” (and the source of such designation, if any), (ii) whether such Conflict Mineral comes from Recycled Sources and (iii) the country of origin of such Conflict Mineral, if such Conflict Mineral does not come from Recycled Sources. In furtherance and not in limitation of Supplier’s obligations under subsection (a) of this Annex 3 above, Supplier shall not incorporate into a Product any Conflict Minerals from any source other than those set forth in Schedule 1 to this Annex 3 without the prior written approval of Customer. In the event that Supplier becomes aware of any inaccuracy in Schedule 1 to this Annex 3, Supplier shall promptly (but in any event within thirty (30) days of the date that Supplier has knowledge thereof) notify Customer of such inaccuracy and provide Customer with updated information.

(c)    Supplier agrees to promptly provide Customer with such documentation and other information relating to the Products or the manufacture thereof, and to cause its suppliers, if applicable, to provide such documentation or other information (including by exercising any audit or similar rights of Supplier pursuant to its agreements with its suppliers), in each case as Customer may reasonably request in connection with fulfilling its reporting obligations under Section 13(p) of the Securities Exchange Act of 1934, as amended, relating to Conflict Minerals (including any country of origin inquiry or due diligence conducted in connection therewith).

With respect to up to […***…] units of the Initial Products, the Specifications for […***…] shall be relaxed, such that the following shall apply with respect to such specifications solely for such […***…] units (the “Sub-Spec Units”):

For avoidance of doubt, all of the other Specifications shall apply to the Sub-Spec Units to the same extent as they apply to other units of Products.

Supplier shall clearly designate to Customer at the time of delivery each such Sub-Spec Unit. Supplier may not designate as Sub-Spec Units more than 50% of any shipment of Initial Products delivered to Customer (for example, if there is a delivery of […***…] units, no more than […***…] may be Sub-Spec Units).