Brainsway Announces Signing of Memorandum of Understanding to Market the Deep TMS Device in Italy

30 April, 2009

Brainsway Announces Signing of Memorandum of Understanding to Market the Deep TMS Device in Italy

Yesterday, April 29th 2009, Brainsway Ltd. (the "Company") signed a Memorandum of Understanding (MoU) with Advanced Technologies Innovation Distribution SRL ("ATID"). ATID is an Italian Company owned by psychiatrist Dr. Ruggero Raccah, businessman Eliyahu Tshuva and others.

According to the MoU signed, ATID will be granted exclusive rights to market and promote sales of the Deep TMS device developed by the Company (the "Device") in Italy.

Under the MoU terms, ATID is expected to initiate contact with clients, promote, distribute, market, import and store Devices; while supply and rental of Devices will be handled by the Company according to agreements signed between the Company and the clients. ATID will help in managing collection of payments from clients. The Devices shall remain the property of the Company.

The MoU sets forth a minimum monthly amount that must be paid to the Company for each Device installed at a client's facilities during the first 15 months of an agreement, which are defined as an "acclimatization period." In respect of the use of the Device after such period, the MoU sets forth a fixed amount to be paid for each treatment administered for depression. Consideration for other indications (should these be approved) will be negotiated in the future, but will be no less than the amount paid for depression. The MoU further stipulates that should the payment model be inapplicable for whatever reason, the parties will agree upon an alternative pricing model. ATID will be entitled to receive the difference between amounts paid by clients and amounts due the Company. The MoU also sets forth the prices and payment plans for the supply of stimulators (manufactured by third parties and used to operate the Device) to clients who require them.

The exclusivity granted to ATID will expire in the event that during any two successive years (starting from the third year) Italian clients introduced to the Company by ATID fail to requisition at least 80% of the number of Devices specified for each year (as provided below), or fail to carry out and pay for at least the minimum average number of treatments per month in respect of each Device installed at their facilities (as provided below). During the first year, ATID should arrange the rental to clients of 12 Devices. Supply of Devices shall begin immediately after the signing of a binding agreement. During the second year of such agreement, ATID is expected to arrange the rental to clients of 25 Devices; and 50 additional Devices are to be rented to clients on each subsequent year during the term of the agreement. The minimum average number of treatments per month in respect of each Device installed starting from the third year of the agreement is set at 60. For Devices installed during the seventh and eighth years of the agreement, this number will be 75; and for Devices installed during the ninth and tenth years - 90 treatments per month on average.

The Company will be liable for any damage/injury to a third party arising from the use of the Device, and will be responsible for the proper working order of Devices rented.

ATID has undertaken to perform on behalf of the Company all the administrative work required to secure regulatory approval for marketing and commercial operation of the Device in Italy (based on the CE Mark the Company has already received), and has also agreed to use any means it sees fit to ensure that treatment using the Device is recognized and covered by private and public health insurance programs in Italy.

ATID has also been granted the rights to perform up to three clinical trials of the Device to explore its efficacy in respect of different indications (pain, smoking cessation, alcohol addiction treatment, or any other indication approved by the Company). These trials, should they be performed, will be funded by ATID, with Brainsway providing, free of charge, three Devices, to the extent required for the performance of these trials.

The Memorandum of Understanding is non-binding and is subject to the signing of a binding agreement.