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In 1996, Josh Shachar, Founder, President, CTO of Magnetecs, and the CEO of two companies that continue to engage in the design and manufacture of advanced technology electronics for the U.S. Department of Defense, observed heart catheterization surgery in which the surgeon had great difficulty in guiding a catheter through the complex path of human arteries to reach the desired position. As he observed the surgeon forcibly pushing the catheter with only an approximate idea of its position as viewed on fluoroscopic equipment emitting significant doses of radiation, he conceived of the theoretical application of a catheter control system that could be guided by electromagnetic technology and integrated with advanced imaging and mapping equipment. In 1999, after theoretical and practical studies and the initial patent applications, Shachar formed the predecessor of Magnetecs Corporation to bring the benefits of the CGCI technology to patients around the world and commercialize the CGCI system under development. In 2001 the first prototype of the CGCI system was completed, demonstrating the ability to precisely and continuously monitor a catheter tip in three dimensions using digital sensory signals. The second prototype was completed in 2002, demonstrating that the tip could be magnetically manipulated in two dimensions using a joystick.

Magnetecs was incorporated in 2003, and in 2005 a strategic investor in the field of advanced medical devices provided a $1.2 million capital investment that funded part of the construction of the first generation CGCI system for animal trials. In 2007 at Cedars-Sinai Hospital in Los Angeles, Magnetecs began a series of 15 formal animal studies, which were successfully completed in 2008. Based on these studies, a larger and more powerful

CGCI system was designed and completed in the first half of 2009. Subsequently in 2009, the Company received USDA certification for animal studies at its EP laboratories and UL certification of the CGCI system. In the second half of 2009, the Company completed its agreement with Hospital Universitario La Paz in Madrid Spain, for installation of the CGCI system for first-in-man clinical trials, followed by an agreement with Mount Sinai Medical Center for the first human trials in the United States.