10-K 1 d10k.htm FORM 10-K
`
`Table of Contents
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`UNITED STATES
`SECURITIES AND EXCHANGE COMMISSION
`WASHINGTON, D.C. 20549
`FORM 10-K
`
`(MARK ONE)
`(cid:95) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
`OF 1934
`FOR THE FISCAL YEAR ENDED SEPTEMBER 28, 2008
`
`OR
`(cid:133) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
`ACT OF 1934
`FOR THE TRANSITION PERIOD FROM TO .
`COMMISSION FILE NUMBER 0-20225
`
`ZOLL MEDICAL CORPORATION
`
`(Exact name of registrant as specified in its charter)
`
`MASSACHUSETTS
`(State or other jurisdiction of
`incorporation or organization)
`269 MILL ROAD, CHELMSFORD,
`MASSACHUSETTS
`01824
`(Zip Code)
`(Address of principal executive offices)
`Registrant’s telephone number, including area code (978) 421-9655
`Securities registered pursuant to Section 12(b) of the Act:
`Title of each class
`Name of each exchange on which registered
`Common Stock, $0.01 Par Value
`The NASDAQ Stock Market LLC
`Stock Purchase Rights
`
`04-2711626
`(I.R.S. Employer
`Identification No.)
`
`Securities registered pursuant to Section 12(g) of the Act:
`None
`(Title of class)
`
`Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes (cid:133) No (cid:95)
`Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes (cid:133) No (cid:95)
`Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities
`Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and
`(2) has been subject to such filing requirements for the past 90 days. Yes (cid:95) No (cid:133).
`Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be
`contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form
`10-K or any amendment to this Form 10-K. (cid:133)
`Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller
`reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the
`Exchange Act (Check one):
`Large accelerated filer (cid:133) Accelerated filer (cid:95) Non-accelerated filer (cid:133) Smaller reporting company (cid:133)
`Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes (cid:133) No (cid:95)
`The aggregate market value of the voting stock held by non-affiliates of the registrant as of March 30, 2008 was $569,214,990 based on a
`closing sales price of $27.47 (the closing price on March 28, 2008) per share as reported on the NASDAQ Global Select Market (for this
`computation, the registrant has excluded the market value of all shares of Common Stock reported as beneficially owned by directors and
`executive officers of the registrant, but includes certain shares beneficially owned by persons known to the registrant to beneficially own more
`than 10% of the registrant’s Common Stock.)
`
`Philips Exhibit 2010
`Zoll Lifecor v. Philips
`IPR2013-00609
`
`Page 1 of 190
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`The number of shares of the registrant’s single class of common stock outstanding, as of December 1, 2008 was 21,061,255.
`
`DOCUMENTS INCORPORATED BY REFERENCE
`Portions of the definitive Proxy Statement to be dated on or about December 19, 2008 to be delivered to shareholders in connection with
`the Annual Meeting of Shareholders to be on held January 20, 2009 are incorporated by reference into Part III of the Annual Report on Form
`10-K.
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`Table of Contents
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`Part I
`Item 1.
`Item 1A.
`Item 1B.
`Item 2.
`Item 3.
`Item 4.
`Part II
`Item 5.
`
`ZOLL MEDICAL CORPORATION
`Annual Report on Form 10-K
`For the Year Ended September 28, 2008
`
`Table of Contents
`
`Business
`Risk Factors
`Unresolved Staff Comments
`Properties
`Legal Proceedings
`Submission of Matters to a Vote of Security Holders
`
`Item 6.
`Item 7.
`Item 7A.
`Item 8.
`Item 9.
`Item 9A.
`Item 9B.
`Part III
`Item 10.
`Item 11.
`Item 12.
`Item 13.
`Item 14.
`Part IV
`Item 15.
`Signatures
`Index to Consolidated Financial Statements
`
`Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity
`Securities
`Selected Financial Data
`Management’s Discussion and Analysis of Financial Condition and Results of Operations
`Quantitative and Qualitative Disclosures About Market Risk
`Financial Statements and Supplementary Data
`Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
`Controls and Procedures
`Other Information
`
`Directors, Executive Officers and Corporate Governance
`Executive Compensation
`Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
`Certain Relationships and Related Transactions, and Director Independence
`Principal Accountant Fees and Services
`
`Exhibits and Financial Statement Schedules
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`Page No.
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`3
`24
`36
`36
`37
`37
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`38
`41
`41
`55
`58
`87
`87
`87
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`91
`91
`91
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`PART I
`
`Except for historical information, the matters discussed in this Annual Report on Form 10-K are forward-looking statements that involve
`risks and uncertainties. The Company makes such forward-looking statements under the provision of the “Safe Harbor” section of the Private
`Securities Litigation Reform Act of 1995. Actual future results may vary materially from those projected, anticipated, or indicated in any
`forward-looking statements as a result of certain risk factors. Readers should pay particular attention to the considerations described in Part I,
`Item 1A. of this report entitled “Risk Factors.” Readers should also carefully review the risk factors described in the other documents that the
`Company files from time to time with the Securities and Exchange Commission. In this Annual Report on Form 10-K, the words “anticipates,”
`“believes,” “expects,” “intends,” “future,” “could,” and similar words or expressions (as well as other words or expressions referencing future
`events, conditions or circumstances) identify forward-looking statements. The Company assumes no obligation to update forward-looking
`statements or update the reasons actual results, performance or achievements could differ materially from those provided in the forward-looking
`statements, except as required by law.
`
`Item 1. Business.
`Overview
`ZOLL Medical Corporation (ZOLL or the Company), a Massachusetts corporation incorporated in 1980, develops technologies and
`software that help clinicians, emergency medical services (EMS) personnel and lay rescuers advance the practice of resuscitation.
`
`To understand resuscitation, it is important to first provide background information about:
`•
`The anatomy of the heart;
`•
`Sudden cardiac arrest (SCA) and how rapid, life-saving interventions can help SCA patients;
`•
`The different arrhythmias that can lead to SCA;
`•
`The issue of traumatic injury and its effects that can also lead to SCA;
`•
`Recent developments and new research in the areas of emergency cardiovascular care and the performance of cardiopulmonary
`resuscitation (CPR); and
`• A definition of the resuscitation technology market.
`
`Anatomy of the Human Heart
`The normal human heart has four chambers, and expands and contracts more than 100,000 times each day. The two smaller, upper
`chambers are the atria, and the two larger, lower chambers are the ventricles. The walls of the atria and the ventricles are made up of cardiac
`muscle, which contracts rhythmically when stimulated by an electrical current. Normally, the heartbeat starts in the right atrium when a
`specialized group of cells sends an electrical signal. This signal spreads through the atria and then moves to the ventricles. As a result, the atria
`contract a fraction of a second before the ventricles. This exact pattern must be followed to ensure that the heart beats properly. This contraction
`and relaxation of the four chambers pumps blood to the lungs and the rest of the body.
`
`Sudden Cardiac Arrest
`Sudden cardiac death results from the sudden, abrupt loss or disruption of heart function. This abrupt loss of function, also known as
`sudden cardiac arrest (SCA), causes lack of blood flow to vital organs. SCA results in a loss of blood pressure, pulse, and consciousness.
`Commonly, SCA is caused by an abnormal heart rhythm called ventricular fibrillation, which occurs when the heart beats too rapidly and/or
`chaotically, or not at all (cardiac standstill from other non-fibrillation dysrhythmias such as pulseless electrical activity).
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`According to the Center for Disease Control and Prevention, there are an estimated 460,000 deaths from SCA annually in the United
`States, and approximately 1,000 people die of SCA every day. SCA strikes without warning and can kill its victims within minutes; most
`victims have no prior symptoms. Many of these deaths are from ventricular fibrillation. For SCA victims, time is the most critical element for
`survival. For every minute of delay in the restoration of effective cardiac function provided by defibrillation—the process of delivering
`electrical current to the heart to stop the fibrillation and permit the return of coordinated cardiac contractions—survival decreases by as much as
`10%. According to the American Heart Association (AHA), more than 95% of SCA victims in the U.S. die, in many cases because life-saving
`defibrillators arrive too late, if at all.
`
`Different Arrhythmias that can Lead to SCA
`Arrhythmias are abnormal rhythms of the heart caused by insufficient circulation of oxygenated blood, drugs, electrical shock,
`mechanical injury, disease, or other causes. The three types of major arrhythmias are ventricular fibrillation and tachycardia; atrial fibrillation
`and flutter; and symptomatic bradycardia. It is possible for a patient to experience more than one type of arrhythmia during SCA. In these
`situations, it is important for trained rescuers to have equipment that has defibrillation and pacing capabilities, as well as technology that can
`assist with CPR performance.
`
`Ventricular Fibrillation. Ventricular fibrillation is a condition in which disorganized electrical activity causes the ventricles to contract in
`a rapid, unsynchronized, and uncoordinated fashion. When this occurs, an insufficient amount of blood is pumped from the heart. Ventricular
`fibrillation is the most common arrhythmia thought to cause SCA. The onset of ventricular fibrillation often occurs without warning and causes
`the heart to cease pumping blood effectively. This sudden stopping of the heart is known as cardiac arrest, which is the cause of sudden cardiac
`death.
`
`The only accepted treatment for ventricular fibrillation is defibrillation. In emergency situations, external defibrillation was
`conventionally administered through hand-held paddles placed on the patient’s chest. However, external defibrillation is now more likely to be
`administered through disposable adhesive electrodes, which are believed to be safer and easier to use than paddles.
`
`According to the AHA, early defibrillation of ventricular fibrillation is the single most effective intervention in the rescue of a victim of
`SCA. Each minute of delay in returning the heart to its normal pattern of beating decreases the chance of survival by 7% to 10%. Furthermore,
`there is an increasing body of evidence that other actions, in addition to defibrillation, must occur to maximize the chance of a successful
`resuscitation. These actions comprise a “Chain of Survival” consisting of early access, early CPR, early defibrillation, and early advanced care.
`Atrial Fibrillation. The AHA estimates that close to 2 million Americans suffer from atrial fibrillation. Atrial fibrillation is a condition in
`which disordered electrical activity causes the atria to contract in a rapid, unsynchronized and uncoordinated fashion. This inefficient
`contraction results in a smaller amount of blood entering the ventricles, which in turn results in an insufficient level of circulation. Since blood
`is not pumped completely out of the atria, the blood can pool and clot. While not immediately life threatening, atrial fibrillation can lead to
`significant health threats, such as stroke. Over time, poorly functioning atria can also cause the ventricles to work harder, wear out sooner, and
`eventually lead to cardiac arrest.
`
`Common forms of treatment for atrial fibrillation include cardioversion and drug therapies. During cardioversion, a defibrillator delivers
`electrical current that is synchronized with a patient’s heartbeat to return the atria to a normal rhythm. Cardioversion is usually an elective
`therapy, scheduled and performed in a controlled environment. All of ZOLL’s manual defibrillators include cardioversion capability.
`
`Bradycardia. Bradycardia is a condition in which the heart beats too slowly. The principal therapies for the emergency treatment of
`bradycardia are drugs and temporary cardiac pacing, either or both of which may be used
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`to stimulate effective cardiac contractions and restore circulation. Cardiac pacing utilizes an electrical pulse to stimulate the patient’s heartbeat.
`For the emergency treatment of bradycardia, there are two primary techniques for temporary pacing: invasive endocardial pacing, in which a
`wire is inserted directly into the heart to provide the electrical stimulus; and non-invasive temporary pacing, which uses gelled electrodes
`applied to the patient’s chest to conduct an electrical stimulus. Non-invasive temporary pacing is an option on most ZOLL defibrillators and is
`recommended as a treatment for bradycardia in the AHA’s resuscitation protocols.
`
`Traumatic Injury and its Effects
`Trauma is widely recognized as a major health problem and the third leading cause of death in the U.S. In 2003, there were over 164,000
`fatal injuries in the United States. Severe injury is the number one killer of both children and young adults up to age 44. As a disease of young
`people, it is also the leading cause of life years lost. The leading causes of death following traumatic injury are brain injury, blood loss, and
`organ failure from excessive inflammation. SCA can also occur in trauma patients.
`
`Recent Developments and New Research in the Areas of Emergency Cardiovascular Care and CPR Performance
`In 2000, a workshop, known as the Post-Resuscitative and Initial Utility in Life-Saving Efforts (PULSE), convened to address
`resuscitation research in the areas of SCA and injury from trauma. The PULSE report, published in Circulation, noted that earlier and better
`CPR, rapid defibrillation, and earlier hemorrhage control will lead to improvements in survival. One recommendation made was that
`“technology-based methodologies for monitoring and performing resuscitation should be improved,” along with the use of “new and novel
`devices to produce blood flow during cardiac arrest.”
`
`The 2005 American Heart Association Guidelines for Cardiopulmonary Resuscitation and Emergency Cardiovascular Care provides
`recommendations about how lay rescuers and healthcare providers should resuscitate victims of cardiovascular emergencies, including SCA,
`which is fatal within minutes of onset, if not treated with CPR and/or defibrillation. The Guidelines, which began in the early 1990s, are
`updated every five years to reflect advancements in resuscitation research and the science. The European Resuscitation Council (ERC) and
`International Liaison Committee on Resuscitation (ILCOR) also release updated Guidelines every five years in conjunction with the AHA. The
`next Guidelines will be published in 2010 and Interim Statements reflecting new science are released between Guidelines publication when
`important changes in practice are acknowledged by experts.
`
`A major theme in the latest 2005 release is the emphasis on performing effective, high-quality CPR. According to the AHA and the ERC,
`the new focus resulted from studies that showed that “blood circulation increases with each chest compression in series and must be built back
`up after interruptions.” In addition, the authors of the Guidelines noticed a “striking” difference between data showing the critical role of early,
`high-quality CPR in increasing cardiac arrest survival rates, and data showing that few victims of cardiac arrest receive CPR—with even fewer
`receiving high-quality CPR.
`
`The AHA and the ERC also maintain that early CPR can quickly return oxygen-rich blood to the heart and throughout the body. In
`addition, when CPR is performed in conjunction with defibrillation, which is indicated in approximately 50% of collapsed victims, it can help
`restore normal heart rhythm, which can double a victim’s chance of survival, especially for the 75-80% who suffer cardiac arrest at home.
`Indeed, without immediate intervention, an SCA victim has only about a 5% chance of survival. But if CPR and defibrillation are provided
`within the first three minutes after collapse, survival rates can reach as high as 75%. Interim Statements have recently reaffirmed the
`importance of CPR, the importance of the quality of chest compressions administered, as well as recommended chest compression only CPR
`without ventilation in an effort to encourage more bystanders to act when SCA occurs.
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`•
`
`The Resuscitation Technology Market
`The Company develops technologies that help clinicians, EMS personnel and lay rescuers advance and improve the practice of
`resuscitation. In order to advance resuscitation practices, the Company believes it must provide technology that addresses various clinical
`interventions that are part of resuscitation efforts. These include the following:
`•
`Pacing, which helps regulate the heartbeat when the heart’s natural native pacemaker is not fast enough, or if blockages in the heart’s
`electrical system prevent impulses from reaching the ventricles. ZOLL has been a leader in pacing technology since its first
`commercial product was released in 1984.
`• Defibrillation, which uses an electrical current to stop the chaotic rhythm so the heart can reestablish its normal rhythmic beating. It is
`used in patients experiencing dangerous arrhythmias or SCA. ZOLL is also a leader in the area of defibrillation, and its products have
`been deployed and accepted by professional healthcare personnel worldwide.
`Circulatory support and assistance for manual CPR performance, which involves helping to circulate oxygenated blood throughout a
`patient’s body when the heart in unable to do so. This is accomplished through manual chest compressions (pushing on the chest) and
`forcing air into the lungs of a patient via rescue ventilation. ZOLL’s Real CPR Help® technology offers real-time feedback to rescuers
`so that they can monitor and improve CPR performance. ZOLL was the first manufacturer to offer this feedback mechanism in an
`automated external defibrillator (AED), which is a portable device that analyzes the heart’s rhythm and, if necessary, allows rescuers
`to deliver an electric shock to an SCA victim. ZOLL now also offers Real CPR Help technology in most of its professional
`defibrillators. It is now also a feature of all of its ALS defibrillators.
`• Automated circulatory support, which automates the process of performing chest compressions rather than having rescuers perform
`them manually. This intervention can help decrease interruptions, while increasing the quality of chest compressions (i.e.,
`maintaining proper rate and depth). The ZOLL AutoPulse® helps healthcare professionals in pre-hospital and in-hospital settings
`automate the process of delivering CPR chest compressions.
`Fluid replacement, which provides circulatory support through intravenous fluid administration that is the primary treatment for
`hypovolemia. Hypovolemia, the decrease in the volume of circulatory blood, is a common condition found in trauma patients and can
`lead to shock, SCA and/or death. Trauma is widely recognized as a major health problem and is the third leading cause of death in the
`U.S. ZOLL’s Power Infuser® has been widely accepted by the U.S. military for fluid resuscitation, and the Company believes it will
`be adopted in the circulation market in the future.
`• Data management, which involves software that automates the documentation and management of both clinical and non-clinical
`information in pre-hospital and hospital settings. These products can work together in an integrated system so that information can be
`captured, documented, and managed throughout the care of a patient, from the field to the hospital. ZOLL information management
`solutions involve: electronic documentation and data gathering (e.g., computer aided dispatch, data from the 911 call, to patient vital
`signs, to records managements and billing information); aggregation of this type of data; and the ability to review and analyze
`information for remedial training/continuous quality initiatives (CQI) or other strategic planning efforts; and management of data
`within the Fire department enterprise to document and improve response.
`• Ventilation involves air entering and leaving the lungs, allowing the body to expel carbon dioxide and oxygenate blood that circulates
`through a patient’s body. While some ZOLL products currently record data related to ventilation and respiration, we do not offer any
`therapeutic devices for ventilation. We plan to offer products in the future specifically for ventilation of patients, and the Company
`regards making improvements to ventilation practices in resuscitation as a future growth area.
`
`•
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`• Hypothermia, which involves cooling patients a few degrees after successful resuscitation (i.e., to 91.5°F or 33°C), may play a role in
`helping resuscitated patients recover. The 2005 AHA/ERC/ILCOR Guidelines suggest that mild hypothermia may be beneficial to
`neurological outcome without significant risk of complications. We have recently acquired proprietary technology in this area that
`includes devices to provide cooling of a circulating solution and endovascular catheters that provide for thermal transfer to cool
`circulating blood.
`
`ZOLL’s Core Technology
`The Company’s line of defibrillators developed for use by professional and lay rescuers include three core technologies that are
`implemented throughout the product line. They include:
`•
`Rectilinear Biphasic™ waveform, which is utilized in our line of professional defibrillators and AEDs;
`•
`External pacing technology in the Company’s professional defibrillators; and
`•
`Real CPR Help technology in its professional defibrillators and AEDs.
`
`ZOLL’s Biphasic Waveform. External defibrillators deliver current over time to the heart, which results in a defined waveform shape.
`Earlier defibrillating waveforms were monophasic, meaning that current is delivered in a single pulse that flows in one direction. Recent
`technology improvements included the development of biphasic waveforms, which, in contrast, deliver current that first flows in a positive
`direction for a period of time and then reverses direction so that it flows in a negative direction.
`
`ZOLL’s primary competitors offer biphasic waveforms using the same general waveform shape. However, the Company has developed a
`uniquely shaped biphasic waveform, which achieves higher efficacy at lower current levels than monophasic waveforms. ZOLL’s biphasic
`waveform reduces the heart’s exposure to high peak current, which helps to reduce risk to the patient, while increasing efficacy. In addition,
`ZOLL’s biphasic waveform keeps the waveform shape and duration constant over a wide range of patients whose differing physiologies affect
`the conduction of current, which also helps to improve efficacy.
`
`External Pacing Technology. In 1984, the Company introduced a non-invasive temporary pacemaker based on the research of Paul M.
`Zoll, M.D., one of the Company’s founders. This technology, which was the cornerstone of the pacing capability in ZOLL’s line of hospital
`defibrillators, has been clinically shown to offer superior capture rates and provide lower mean capture thresholds. It also allows better patient
`tolerance of external pacing due to reduced current requirements and large surface area electrodes that deliver the current. In 1992, the AHA
`elevated non-invasive pacing to the initial treatment of choice for certain serious patient conditions (Class 1 for profound bradycardia). This
`means that external pacing should be performed on patients because of the clear benefit, with little risk. The Company believes that it was the
`market leader for this technology at that time and remains so today.
`
`Real CPR Help Technology in its Professional Defibrillators and AEDs. In 2002, with the launch of the AED Plus®, ZOLL introduced
`technology that allows rescuers to see and hear how well they perform the rate and depth of chest compressions during a cardiac arrest event.
`Along with the AED Plus, ZOLL has integrated this Real CPR Help technology into the AED Pro®, M Series®, E Series® and R Series®.
`
`ZOLL’s Line of Resuscitation Products
`The Company’s resuscitation products fall into the following categories:
`•
`Professional defibrillators, which include the M Series, E Series, R Series, and AED Pro with manual defibrillation capability;
`• AED products for use by minimally trained rescuers, which include the AED Pro and the AED Plus;
`• Disposable electrodes used with ZOLL’s line of defibrillators;
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`The AutoPulse Non-invasive Sudden Cardiac Support Pump, used to automate the process of delivering chest compressions;
`•
`• Documentation and information management, which include RescueNet® for EMS and fire personnel and CodeNet® for hospitals;
`• Device and technology designed for endovascular hypothermia (developmental stage);
`• A wearable automatic defibrillator, the ZOLL LifeVest®, which is prescribed by cardiologists for individual patient wear during
`periods of risk of SCA; and
`Fluid replacement utilizing the ZOLL Infuser, also known as the Power Infuser®, in trauma.
`
`•
`
`Professional Defibrillators
`A professional defibrillator is used by trained healthcare professionals to defibrillate a person in SCA. Healthcare professionals can
`review a patient’s heart rhythm, determine the need for a shock and manually select the level of energy (“dose”, calculated in joules) used to
`defibrillate. ZOLL’s professional defibrillators also include monitoring selectable parameters (e.g., oxygen saturation levels, 12-lead acquisition
`and analysis, invasive and non-invasive blood pressure, and end tidal CO2 concentrations among others) to provide an assessment of a patient’s
`condition.
`
`M Series Defibrillators. The M Series family of products was designed for both the hospital and pre-hospital markets. ZOLL currently
`sells 11 models of this device, including a model designed for critical care transport and a model tested and certified for use on military aircraft.
`New to most models of the M Series is Real CPR Help, real-time feedback that measures the rate and depth of chest compressions.
`
`The large number of models reflects user selection and need for various features and options such as shock advisory capability, 12-lead
`ECG, diagnostic operation, and data transmission features. The M Series defibrillator is the Company’s best-selling product to date. It has been
`selected as the standard device by institutions such as Brigham and Women’s Hospital, The Mayo Clinic, The Johns Hopkins Hospitals, the
`U.S. Armed Forces, and the German Army. ZOLL believes that the M Series’ clinical superiority and range of features have helped maximize
`customer retention by reducing the need for operator retraining and enhancing operator confidence.
`
`M Series defibrillators were designed to allow customers to add features depending upon their individual needs. Other features available
`include the following:
`• Complete Data Management. A code marker system follows protocols established by the AHA, and it allows complete
`documentation of an event with a “one touch” data annotation feature. The record made of the event includes all information
`collected by the defibrillator and can be upgraded to include an optional voice recording. All of this data is stored on a removable
`data card. It can also be transmitted electronically to other devices via a serial port, built-in modem, and Bluetooth® wireless
`communications, allowing significant flexibility in moving data for purposes of remote consultation and recordkeeping. ZOLL also
`developed software applications for the archiving and trending of this information.
`• Diagnostic 12-lead ECG with Interpretive Statement. The 12-lead feature enables a user to get a diagnostic ECG tracing, or a view
`of the heart’s electrical activity. 12-lead is used to provide rapid and early identification of myocardial infarction, commonly called a
`heart attack, in the pre-hospital setting. ZOLL pays royalties to GE Medical Systems (GEMS) on each 12-lead analysis program sold.
`Pulse Oximetry. Pulse oximeters determine the oxygen saturation levels in blood (SpO2), allowing a rapid identification of potential
`problems in the cardiopulmonary system. Since pulse oximeters can help detect the onset of cardiovascular incidents, pulse oximetry
`is now widely used in both hospital and pre-hospital settings when monitoring patient vital signs. While conventional pulse oximeters
`do not
`
`•
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`perform well during patient motion or in intense light, ZOLL uses Masimo Corporation’s patented technology, which is designed to
`overcome these technical problems. ZOLL purchases circuit boards and sensors from Masimo Corporation. The Company has a non-
`exclusive license to use the patented technology incorporated in these parts, which are incorporated, in turn, into ZOLL’s products.
`• Capnography. Capnography, also known as EtCO2, is the measurement of the amount of carbon dioxide being exhaled, allowing for
`rapid identification of potential problems in the cardiopulmonary system. ZOLL purchases circuit boards and sensors from
`Respironics Novametrix LLC that provide this feature. In October 2004, ZOLL announced new plug-and-play mainstream and side
`stream EtCO2 monitoring capability designed for ease of use in pre-hospital settings. Users can easily select the optimum CO2
`monitoring method based on the patient’s condition.
`• Non-invasive Blood Pressure Measurement. ZOLL incorporated a non-invasive blood pressure measurement capability, also
`known as NIBP, and integrated it into the M Series and E Series defibrillators. ZOLL purchases circuit boards, hoses, and cuffs from
`SunTech Medical to provide this feature.
`E Series Defibrillators. The E Series family of products is a line of defibrillators for the pre-hospital environment, which also offers a
`range of similar monitoring and data features that are also available on the M Series. The E Series was launched in July 2005 and began
`shipping in September 2005. Designed specifically for the EMS market, the E Series offers several unique features that will allow the Company
`to expand the EMS portion of the pre-hospital market. The E Series is targeted towards Advanced Life Support providers, and it includes all of
`the features of the M Series, as described above, including Real CPR Help. ZOLL believes that the E Series is the only rugged, durable
`defibrillator available today that offers the following:
`• Designed to Meet the Needs of the EMS Environment. A suitcase-style with a protective roll cage allows customers to carry or
`store the device more easily. It also offers a Rapid Cable Deployment System™ that helps manage all the parameter cables, allowing
`for faster deployment.
`TriMode Display™. The E Series allows users to view the screen under virtually any lighting conditions.
`Improved Event Synchronization. The E Series is equipped with a built-in GPS clock that allows customers to automatically
`synchronize all dispatch, defibrillator, and intervention call times, improving overall data accuracy.
`See Thru-CPR®. The Comp