zimwnt-ufc01_wntp236_4097_001 (00000002).pdf

8/18/2019 ZIMWNT-UFC01_WNTP236_4097_001 (00000002).pdf

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))MAGNAPHARMACIA


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Zimmerbiomet/ Magna/ Distribution Agreement

Preliminaryremarks

(A) Sellers are member companies of the Zimmer-Biometgroup (hereinafterreferred to as'oZimmer-Biomet ),headquartered in Warsaw, Indiana, USA,whichare dedicated todevelop, manufactureand marketorthopaedic reconstructive, spinaland trauma devices,dental implants, and related medicaldevices.

(B) Notwithstandingthe above, Sellers operate as separate legal entitieswhicheach sell anddeliverthe Products (as defined below) to Distributorseparately.

(C) Distributor isin the business of, and has experience in, marketing and sellingproductssimilarto the Products. Distributordesires to market and distributeSellers' Products inthe Tenitory (as defined below).

(D) Sellers desire to have the Products marketed and distributedby Distributorin theTerritory.The sale and delivery ofthe Products fromSellers willbe conducted separatelybetween Distributorand Zimmeron the one hand and between Distributorand Biometonthe other hand. Despite this separation, the terms and conditionsof the sale and deliveryfromSellers to Distributorshall be carried out onthe basis of thisAgreement.

(E) This Agreementamends and replaces the DistributionAgreementby and betweenDistributorandZimmerin force as of 1 February 2015.

NOWTHEREFORE,in consideration of the mutual undertakings and covenants containedherein, the Parties agree as follows:

Terms and conditions

l. Definitions1.1 Unless the context clearlyrequires otherwise,as used herein, the followingcapitalized

terms shall have the followingmeanings:

Affiliate(s) means withrespect to a specifiedParty to this Agreement,any individual,association or other entity that directlyorindirectlycontrols,is directly orindirectlycontrolledby, oris directlyor indirectlyunder commoncontrolwithsuchspecified Party, For purposes of this definition, control(including controlling, controlledby, and undercommon controlwith )means owningfiftypercent (50%)ormore of the outstanding votingsecurities of an entity,orotherwise possessing, directlyor indirectly,the power todirect orcause the directionof the management and policies

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Zimmerbiomet / Magna/ Distribution Agreement

Agreement

BIS

Bribery Act

Change of Control

CMR

ConditionDistributor

EU

FCPA

FSCA

FSN

HSC

Initial Term

Instruments

Intellectual Property

ISO

Italian Law 231l,ff*m

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of an individual, association, or other entity, whetherthrough the ownership of voting securities, by contract orotherwise;

means this Exclusive Tripartite Distribution Agreement, asthe same may be amended or supplemented from time totime in accordance with its terms and conditions;

means the U.S. Bureau of Industry and Security;

is defined in Section I3 of Annex D of this Agreement;

means (i) a direct or indirect change in ownership of morethan 20% of the voting (common) shares directly orindirectly held in the share capital of Distributor, or (ii) asale of the majority of the operating assets of Distributor;

as referred to in Section 4.8 means the Convention relativeau contrat de transport international de Marchandises parroute , a standardized document for cross-border transport ofcargo by road;

is defined in Section 15.1 of this Agreement;means the party as defined in the first page of theAgreement;

means European Union;

is defined in Section I 3 of Annex D of this Agreement;

means a Field Safety Correction Action as defined in Section8.4 of this Agreement;

means Field Safety Notice as defined in Section 8.4 of thisAgreement;

is defined in Section 14.2 of this Agreement;

is defined in Section 1 1.1 of this Agreement

is defined in Section 5.1 of this Agreement

is defined in Section 12.1 of this Agreement

me an s the Internati onal Or gan ization for S tandar dization

shall have the meaning as defined in Section I 3 of Annex Dof this Agreement

is defined in Section 4.1 of this Agreementinimum Purchase

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Requirements

OECD Bribery ConventionOFAC

Products

Relevant Agents

Renewal Term

Reporting Incident

Restricted Party Lists

Sellers

Termination

Territory

Trade Control Laws

Trademarks (Product andCorporate Trademarks)

VAT

Zimmer-Biomet

1.2

1.3

t.4

is defined in Section I3 of Annex D of this Agreementmeans the U.S. Treasury Department's Office of ForeignAssets Control

is defined in Section 2.1 (a) of this Agreement

is defined in Section I 1 of Annex D of this Agreement



is defined in Section II c of Annex D of this Agreement;

means Zimmer GmbH and Biomet Global Supply ChainCenter B.V.;


means the region as set out in Section 2.1 (a) of thisAgreement;

shall have the meaning as defined in Section II of Annex Dof this Agreement;

is defined in Section I2.2 of this Agreement;

means value added tax; and

is defined in Preliminary Remark A.

Headings. Headings are used herein to facilitate the reading and do not define or affect inany way the meaning and interpretation of this Agreement.

References. Unless the contrary intention appears, a reference to an article, section orschedule is a reference to an article, section or schedule of or to this Agreement.

Conflict of Terms. In case of a conflict or inconsistency between a provision in the mainpart of this Agreement and a term in any of the schedules or other documents referred toor otherwise incorporated into this Agreement, the provision in the main part of thisAgreement shall take precedence, unless the schedule or other document which isincorporated into this Agreement expressly states the contrary.

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2.1

2.2

2. Purpose and Right of Sale

Grant of distribution rights and license to Intellectual Property rights. As of theEffective Date, Sellers grant to Distributor and Distributor hereby accepts:

(a) an exclusive right to market and sell in the territory of Republic of Serbia hereinafterthe Territory ) the products as set out in detail in Annex A1 with respect to Zimmerand Annex A2 with respect to Biomet hereto (hereinafter the Products ) which aresupplied by Sellers in accordance with the terms and conditions of this Agreement;and

(b) an exclusive license to use in connection with the marketing and sale of such Productswithin the Tenitory the Intellectual Property in accordance with Section 12 of thisAgreement.

Variation of Product lines. Sellers, at their sole discretion, may, on a 60 (sixty) daysprior notice to Distributor, cease to sell any of the Products, provided that (i) the ordersreceived and accepted before the effective date of such notice shall be filled, and (ii)Sellers shall continue to supply to the Distributor any such Products necessary to fulfillobligations of the Distributor related to on-going, already awarded tenders or supplycontracts, to the extent such Products are available in Sellers product portfolio andavailable in sufficient quantities. In case the Sellers would intend to cease with sale ofany of the Products pursuant to this Section 2.2, they will in advance request from theDistributor information on its expected requirements for any such Products in the next 12months period and upon receiving such information the Sellers undertake to ensuresufficient quantities of any such Products to satisff notified expected requirements of theDistributor.

By way of exception, Sellers shall have the right to cease to sell any of the Productsimmediately, if requested to do so by a regulatory authority or mandated by applicablelaws, rules or regulations, including but not limited to a product recall according toClause 8.3.

Likewise Sellers may from time to time add new products to their product lines for thesale and delivery in the Territory and Distributor agrees to actively solicit sales for suchnew products in the Tenitory in accordance with the terms and conditions of thisAgreement. Any such notice is as a modification to Annex A1 or Annex A2, providedthat Zimmer or Biomet provide Distributor with an updated version of Annex A1 orAnnex A2 concurrently with such notice.

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3.1

3. DistributorfsObligationsGeneral obligations. Withoutprejudiceto any other obligationsunder this Agreement,Distributorhereby undertakes:(a) to distribute theProducts in the Territoryunder their originalbrand names and in their

originalconditionand packaging;(b) to import,purchase and resell the Products under its ownname and for its own

account and consistentlyuse its best effortsto sell the maximumamount of Productsin the Territory;

(c) to assign a minimumof 5 (five)fullytrained Productsales representatives whoshall

devote themselves exclusivelyfor the performanceof Distributor'sobligationshereunder withregard to the Products. Distributorshall bear all costs and expenses,includingall salaries and other benefits costsof its employees related to theperformance of such efforts.Distributorspecificallyacknowledges and agrees that thecontinued manningof a dedicated sales forceas specified above is a fundamentalelement of thisAgreement;

(d) to participatein compliancewithany relevant industrycode and instructionsof Sellerat its owncosts in any local trade shows fororthopaedic products and to prominentlydisplay and market the Products duringsuch events;

(e)to submitto Sellers for

priorwrittenapprovalall marketing materials,

includingbutnot limitedto local labellingto accompany the sales of Products , and, when required,

ensure that such materials are adequately translated by a certifiedtranslator;(Ð to submitto Sellers information relatingto Distributor'sinventorylevelof Products,

sales reports includingsales forecasts and general market conditions,all in a formatacceptable to Sellers and at reasonable intervalsin order to assist Sellers in theworldwidestatisticalanalysis and productionplanning.Distributorshall submitdetailed inventoryforecasts by product groupingto Sellers on a quarterlybasis.Distributorfurtheragrees to informSellers of its planningand budgetingfor mattersrelatingto Sellers' Products;

(g) to submit to Sellers informationrelatingto the hospital sales data includingsales inLCand units per brand by monthand versus prioryear, monthly reportingon marketand competitoractivities, marketing activities,opportunitiesand threats to thebusiness as wellas new & lost accounts specifications,all in a formatacceptable toSellers and on a monthlybasis in order to assist Sellers in the worldwidestatisticalanalysis and productionplanning.Representatives of Distributorand Sellers shallmeet on a halfyear basis to discuss such analysis;

(h) to provideto Sellers, ifrequested, upon demand and on a quarterlybasis for a periodto be communicatedby Sellers, information on therespectivevolumeof identifiedlProducts sold directlyor indirectlyto specifichospitals,whichnames willbefl' læ- / fl#Å zin,¡r)^

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provided by Sellers to the Distributor in a form of a report. Said report is necessary

for Sellers in order to record the sales to hospitals in the Territory where surgeonsare

employed and who have development and license agreements with Zimmer or Biometon identified Products. Under said agreements, royalties are due based on salescalculations which should exclude the sales to the above mentioned specific hospitalson the identified Products. Therefore, Distributor agrees, in case specificallyrequested by Zimmer or Biomet, to complete and retum to Zimmer an electronicreporting form with the above mentioned requested information, within a time linedefined by Zimmer or Biomet.

(i) to advise Zimmer or Biomet, in writing, of each bid which Distributor proposes tosubmit in response to an invitation to bid for the purchase, when that bid requires thepurchase by Distributor from Zimmer or Biomet of at least USD 25,000.00 worth ofproducts and requires a delivery date for the Products by Distributor in less thanninety (90) days from the date of the award of the contract. Sellers respectively shallpromptly notify Distributor, in writing, whether or not it or they will undertake tosupply Products under said bid should said bid be accepted;

0) to handle and store the Products in strict compliance with instructions given byZimmer and Biomet, avoiding contamination (from or of other products) anddeterioration by light, moisture, temperature or other environmental influence and inany event to comply with the guidelines and recommendations issued by the health

authorities, as well as in accordance with the requirement for storage of medicaldevices, applicable in the Territory. Distributor shall strictly observe the first-in-first-out principle in relation to the Products unless important reasons warrant a deviationfrom the principle;

(k) to strictly comply with any and all special storage conditions required for a Product asstated in the package insert andlor product label. Records of monitoring activitiesdemonstrating compliance to the specified conditions will be maintained throughoutthe storage and distribution process;

(l) to maintain, during and after the termination or expiration of this Agreement, an

accurate system of record keeping that will make it possible to trace precisely theProducts from placement of order with Zimmer and Biomet up and until delivery tothe end-customer, including all significant events which may occur during thepurchase, delivery, storage and distribution of the Products. Zimmer and Biomet'srepresentatives are authorized to have access to these records upon simple notificationto Distributor and to receive a copy of these records. In the event Distributor sells to athird party who is not an end-customer, Distributor shall use its best efforts to imposethe same obligation on such third party. In case such third party refuses to acceptsuch obligations, Distributor shall document and record the reasons for suchdeviations and obtain Sellers'written approval prior to deliver Products to such third

pafty. Distributor shall locate, retrieve and return Products in the event of a productrecall. Any costs and expenses arising out of such corrective action shall be bome

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Zimmerand Biomet,unless and to the extent the FSCA is attributableor caused by

Distributor.(m)tomaintainin strict confidence and not use except for the purpose of this Agreement

any confidentialinformationfurnished by Zimmeror Biomethereunder, and shallimpose the same obligationupon its employees, sub-contractors and sub-distributorsduring the present Agreement and 7 (seven) years after its terminationor expiration,unless and untilthe said informationhas entered the publicdomain, by no faultof theDistributor,or in case Distributoris obligedunder any law or publicauthorityruling,decision and/or resolution to disclose such information;

(n) to diligentlyprovide,under its own responsibilityand expense, fordeliveryand

installation ofthe Products and, ifcustomers so request, maintenance of the Products,according to Zimmerand Biomet s regulatoryand qualitypolicies as coÍtmunicatedto Distributorby Zimmerand Biomet.Distributorshall not undertake, eitherintemally orby thirdparties, any servicingor repair of Products of Sellers withoutprior writtenapproval from Zimmeror Biomet;

(o) to complywiththe general concepts of qualitymanagement and qualitysystems asdescribed in ISO 13485. Distributorshall support qualityaudit activitiescarried outby Sellers and their notifiedbody, ifappropriate. This may include on-siteauditingduringnormalbusiness hours and followinga notice, deliveredto Distributorno lessthan 5 (five)business days in advance;

(p) to fulfillallorders of its customers in a way that ordered Products are dispatched andinvoicedto customers as soon as possible after receipt of the respective order fromZimmeror Biomet;

(q) to informcustomers withinthe Territoryabout the Products available for sale and toreceive and process orders fromcustomers withinthe Territoryfor Products as per theterms and conditionsof this Agreement. Distributorhereby accepts such appointmentand undertakes to use every reasonable effortto create and maintaina market for andto increase the sale of Products in the Territory butin doing so to complywiththepoliciesand procedures notifiedbyZimmerand Biometto Distributorfrom timetotime as wellas withany applicable law. Distributorshould endeavor to respect therightsof and deal fairlywithSellers customers, suppliers, competitors andemployees. Distributorshould not take unfairadvantage of anyone throughmanipulation,concealment, abuse of privilegedinformation,misrepresentationofmaterialfacts, or any otherintentional unfairdealing practice;

(r) to prepare together withthe Sellers a filingfor the individualexemptionfrom thecompetent competitionauthorityof the Territory,ifapplicable, and inevent to strictlyabide by any competitionlaws and regulations applicable inTerritory;and

(s) to offerallpracticableand administrativeassistance in the collectionof ZimmerandBiometreceivables outstanding in the Territoryat the time thisAgreement was

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3.2

entered into and, if applicable, to transfer any monies collected to Zimmer andBiomet without delay upon receipt.

Obligations to discharge tax and duties. Distributor shall have the complete and soleresponsibility for the payment of any tax obligations resulting from this Agreement,including for import taxes, unless otherwise provided for in conformity with the productsupply terms set out in Section 4. Further, it will have no recourse to Zimmer or Biometin the event of failure to comply with any relevant tax regulations.

Appointment of sub-distributors. Distributor may only appoint any sub-distributorswith the prior written approval of Sellers, which approval may be given or withheld inSellers' sole discretion. In case of an appointment of a sub-distributor by Distributor,Distributor shall ensure that the sub-distributor complies with all applicable regulationsand laws as well as with the terms and conditions of this Agreement. An individual orentity shall only be eligible to become a sub-distributor for the Products if such person orentity has been approved by Sellers and such person or entity has complied with anyrequirements that Sellers may have established from time to time for sub-distributors.Throughout sub-distributor's engagement, Distributor must ensure that such sub-distributor does not violate any terms and conditions of this Agreement. Distributor andsub-distributor shall have joint and several liability to Zimmer and Biomet for theirperformance under this Agreement. All approved sub-distributors shall be entered onAnnex F.

Appointment of sub-contractors. Should Distributor engage any sub-contractors forperformance under this Agreement, Distributor will be solely liable for the activities ofany sub-contractors.

Compliance with Law. Distributor agrees that in performing its obligations under thisAgreement, it shall comply at all times to comply, with all applicable laws, regulationsand govemmental orders of the government of the Territory and of any jurisdiction inwhich Distributor performs its obligations under this Agreement or that could otherwisebe applicable. Distributor's obligation regarding compliance with law and tradecompliance as well as with customs and import laws and regulations of the Tenitory isspecified in more detail in Annex D.

Products Purchase Requirements, Prices and Sales Conditionso Product ResaleConditions

Minimum purchase requirements. Non-binding target products purchases for 2016(January 1s1,2016 to December 31st, 2016) are stated in Annex Bl with regard toZimmer and Annex 82 with regard to Biomet ( Target Purchases ). Minimum Products

purchases requirements are for the purposes of this Agreement set to 60Yo of the TargetPurchases ( Minimum Purchase Requirements ). The Target Purchases and Minimum

3.3

3.4

3.5

4.

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4.2


Purchase Requirements do not include any Product purchase of initial start-up inventoryof Products (Section 10.1) and Instruments supplied. However, for the avoidance doubt,the Target Purchases and Minimum Purchase Requirements for the year 2016 shallinclude all Products ordered by Distributor under the Distribution Agreement concludedby and between Distributor and Zimmer that was in force as of 1 February 2015. For thecontract period 2017 and thereafter, Distributor together with Zimmer and Biomet shallestablish annually before 15 October of each year, the annual Minimum PurchaseRequirements for the succeeding year for the Products including the amount of sales inthe market and distribution coverage. In the event the Parties fail to agree in respect ofMinimum Purchase Requirements levels for any succeeding year, the Minimum PurchaseRequirements for the preceding year plus 10 (ten percent) will become the Minimum

Purchase Requirements for that year. If Distributor fails to meet the MinimumPurchase

Requirements, Sellers shall be entitled to (i) change Distributor's exclusive status into anon-exclusive Distributor's status, after a written notice thereof has been provided toDistributor, or (ii) to reduce the Territory provided for herein, or (iii) to terminate theAgreement in accordance with the terms and provisions of this Agreement

Orders fulfillment terms. In the absence of an event of force majeure, including withoutlimitation, strike or reasons beyond the reasonable control of Zimmer or Biomet or theirdesignees, Zimmer or Biomet or their designees undertake to fulfrll Distributor's ordersfor Products within a reasonable time. If a delivery time is agreed upon with reference toone

or more specificorders, such

delivery timesshall be deemed indicative only and not

ofthe essence.

Product labels language. Zimmer and Biomet agree to provide the Products and relatedinstructions with labels in any required language(s) necessary in the Territory forhandling and delivering the Products.

Product sales support by Sellers. Sellers further agree to furnish Distributor with suchtechnical assistance as Distributor may reasonably request and that Sellers are capable offulfilling including without limitation sending one of their employees to Distributor.Zimmer and Biomet will supply the Distributor with, among other things, technicalsupport the Distributor may reasonably require for the sales, after-sales service andmaintenance of Products sold in the Territory pursuant to this Agreement. Sellers shall inparticular assist Distributor in conducting and organizing sales meetings and clinics totrain Distributor's sales personnel free of charge. Such meetings and clinics must bescheduled in advance by mutual agreement between Distributor andZimmer or Biomet.

Products price. The sales price for Products charged to Distributorby Zimmer or Biometwill not change in2015, whereby they may change in2016, as a function of the cost ofthe Products, economic developments and improvements of the Products. Zimmer and/orBiomet will sell Products to Distributor at prices exclusive Value Added Tax FCA(INCOTERMS 2010) point of shipment shown on the Zimmer Europe Export and

4.3

4.4

q

4.5

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4.6

4.7

4.8


Distributor Price List. Zimmer reserves the right, on 90 (ninety) days notice prior to any

shipment, to modi the prices of the Products. Zimmer and Biomet will supply annuallyto Distributor estimates of Distributor net cost increases by the end of October.

Payment terms. Distributor agrees to pay Zimmer or Biomet or their designees the fullsales price of the Products as stated on the invoice of Zimmer or Biomet for eachshipment within 150 (one hundred fifty) days from the invoice date. Distributor agrees topay interest at the rate of one and a half percent (1.5%) per month on all overdueinvoices. Zimme.r and Biomet issue their invoices upon shipment of the Products. Ifinvoices are overdue for more than thirty (30) days, Sellers, at their sole discretion, may(i) withhold all subsequent deliveries until the overdue account of Distributor is settled;

(ii) unilaterally modify all agreed credit and payment terms; and/or (iii) terminate thisAgreement as such default constitutes a material breach. Acceptance by Sellers of lessthan full payment shall not be a waiver of any of their rights.

Debt collection. Distributor must pay all costs of collection, including, but not limited to,reasonable attorneys' fees, court costs and collection agency fees involved in thecollection of (a) past due accounts; (b) amounts owed to Sellers by reason of Distributor'sbreach of this Agreement; and (c) any and all amounts owed by Distributor to Seller forany reason whatsoever.

Delivery terms. All deliveries of Biomet and Zimmer Products shall be FCA, GSCCHAZELDONK, The Netherlands ICC 2010 FCA, Zimmer International LogisticsEschbach, Germany ICC 2010, unless agreed otherwise. Distributor shall - at its own riskand expense - affange for insurance for the Products to be transported from Sellers'respective facility to their destination, with a reputable insurer, in line with the currentmarket practice in the industry. Upon request of Zimmer or Biomet, Distributor shallprovide Zimmer or Biomet, as soon as possible, but in any event before the Products areoffered for transport, with a copy of the insurance certificate. Upon request of Distributor,Sellers can offer transport with Sellers' nominated carrier, for the risk and expense ofDistributor. If Distributor nominates and contracts a carrier, Distributor must send foreach shipment immediately, without the request of Sellers, sufficient proof of crossborder transport of the Products out of the country of delivery. Such proof can be in theform of, but not limited to, standard shipping documentation, CMR Cargo letters signedfor receipt in the country of arrival, copies of freight invoices that specify the shipment,export customs documentation, etc. which can be traced back to Sellers. If such proofcannot be provided, Sellers are authorized to retrospectively (and with future shipmentsthat are transported in a similar fashion) add the applicable VAT rate to the deliveries toDistributor for the Products including potential fines that may be levied by the relevanttax authorities due to the incorrect application of the applicable VAT rate.

General provision on costs, duties and taxes relating to the Products. Alltransportation costs, forwarding agents' fees, port, dock and handling charges, insurances,

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tariffs, customs duties, and all applicable taxes, and any other costs of exportation afterleaving point of origin, including all costs of importation into the Tenitory, shall beregulated by the INCOTERMS 2010 as provided within this Agreement.

4.10 Product resale price. Distributor is free to determine the resale price for the Products,provided that in doing so, Distributor will respect any relevant and applicable priceregulations in the Territory.

4.ll Credit limit allowed to Distributor. It is agreed that Zimmer and Biomet will authorizeDistributor for a credit [to be agreed upon credit limit]. Zimmer and Biomet have theright not to satisfy Distributor's orders if the amount of Distributor's credit limit exceedsthe then agreed upon limits.

4.12 Maintenance of appropriate inventory assortments. Zimmer and Biomet agree toassist in the balance and appropriateness of Distributor's inventory of Products by rotatingProducts to a maximum value of ten percent (10 ) of annual net sales each to Distributoror USD 150,000.00 each whichever is less by issuing credit notes for the returned stockand invoicing the replacement stock selected by Distributor, provided (i) that thereplacement stock is equal in value to the stock returned pursuant to this Section; (ii) thatthe returned stock has a minimum of two (2) years shelf-life remaining at the time ofreturn; (iii) that the returned stock was purchased by Distributor in the previous two (2)years; (iv) and that the returned Products are current, global Products, are in goodconditions and in their original packaging. Zimmer and Biomet shall charge Distributor arestocking charge of ten percent (10 ) of the net sales price.

4.13 Retention of title. The Parties agree that the Products sold by Sellers to the Distributor inthe Tenitory are sold with a clause providing expressly transfer of their title fromZimmer or Biomet to the Distributor subject to total payment of the respective price, bothprincipal and accessory to Zimmer or Biomet. The foregoing provisions shall not prevent,on delivery of the Products transfer to the Distributor of the risks of loss or deteriorationof the Products subject to the title reservation, as well as any damage that might becaused. The Distributor must take out adequate insurance to cover such risks from themoment of delivery of the Products. The Distributor shall not pledge the Products assecurity or transfer their ownership as guarantee.

4.14 Marketing and medical education contribution. Zimmer undertakes, during 2015, tosupport the Distributor's expenses for Marketing and Medical Education with USD100,000 (one hundred thousand US dollars) divided as follows:

Zimmer agrees to support or reimburse the Distributor, at a fair market value and only ona presentation of supporting invoices from the organizing committees, with USD 25,000(twenty five thousand US dollars) for national orthopedic congress, exhibition space,

similar congress and associated cost which take place in the Territory. Distributor shalladvise Zimmer in the prior quarter the date of the event.

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5.1

5.2


The further USD 75,000 (seventy five thousand US dollars) will be held by Zimmer to be

offset for Training Education costs at Zimmer Institutes courses. The support shallbe

comprehensive of registration costs, courses costs, accommodation and subsistence costs.The airfares costs to the venue shall be for the Distributor's account.

5. Conditions for the Supply of Loaned InstrumentsDefînition of Instruments. For the purposes of this Agreement, Instruments means alltools designed, manufactured and/or supplied by Zimmer or Biomet and are necessary forthe correct usage and implant of the Products by the authorized end users.

Supply of Instruments. Zimmer shall continue to provide, on a free loan basis, FOCinstrumentation for a value of USD 130,000 (one hundred thirty thousand US dollars) tothe Distributor. For the instruments delivered by Zimmer to Distributor (at Distributor'srequest) in excess of this amount, Distributor shall pay to Zimmer remuneration in theamount of 50o/o of manufacturing cost of any such instrumentation. From time to time theParties may agree to share the cost of instrumentation.

5.3 Unless otherwise agreed, the Instruments will be made available to Distributor byZimmer and Biomet on a free loan basis, subject to all terms and conditions herein setout. To this end, Zimmer and Biomet will notify Distributor on the quantity and types ofInstruments they wish to consign to Distributor. Distributor may request that theInstruments' assortment be adjusted by Sellers to reflect actual and documented marketneeds. Otherwise the Distributor may not object to Zimmer's or Biomet's stated amountof deliverable Instruments.

5.4 Instruments' value. Sellers upon supplying the Instruments shall, if they so elect, notifyDistributor of the Instruments landed value. Instruments' depreciation shall likewise beaccounted for, if at all applicable. If a value for the Instruments has been identified byZimmer or Biomet, Distributor shall be debited the Instruments' value in the event thatdue to Distributor's fault they perish andlor are destroyed and/or are lost or otherwise

become no longer marketable for any reason.

5.5 Delivery of the Instruments and custody. The Instruments shall be delivered byZimmer or Biomet at their cost pursuant to DDP INCOTERMS 2010, Distributor'swarehouse, unless otherwise agreed in writing. Upon delivery, Distributor shall beresponsible for the Instruments' preservation and secure storage, until delivered to endcustomers. To this effect, Distributor shall enter into and maintain throughout theduration of this Agreement a proper all risks insurance policy with a minimum coverageequivalent to the total landed value of the Instruments loaned. A copy of such aninsurance policy shall be provided to Zimmer and Biomet upon request.

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5.6


Sellers retentionof title.Sellers titleover the Instrumentsshall at all times be duly

acknowledgedand signaled. To this effect, whileat the Distributor swarehouse(s),Distributorshall affixsigns to identifythe Instruments as Zimmer sor Biomet s propertyand shall segregate the Instrumentsfromother products in storage, includingtheProducts. Likewise Zimmer sand Biomet stitleover the Instrumentsshall be dulyacknowledged in the contracts withhospitals, to whichDistributorundertakes not to sellbut deliver the Instrumentson a free loanbasis. In the contracts withhospitals,Distributorshall use its best efforts to insert clauses obliginghospitals to properlymarkthe Instruments as Zimmer s orBiomet s propertywhilein storage or use at the hospitalssites. Distributorshall at all times be forbiddenfrom,pledging,sellingor otherwisedispose of the Instruments ifnot withinthe limitsexpressly provided hereunder.

Instrumentso tracking.Distributoron the fifth(5th)business day of each month shallprovideZimmerand Biometwithan updated monthly trackinglistdetailingfor eachInstrument the currentlocationand actual usage. Each monthlytracking list shall bedrawn up in accordance with the formatrequested by Sellers, ifany, and shall in anyevent reflect the locationand usage status of the Instruments at the given date, regardlessof any redundancy (i.e. each tracking list shall repeat for the Instruments the sametrackingdetails as set out in the previous monthlylist if these have not changed).

Restitutionof the Instruments.Upon Zimmer s or Biomet s request, the Instruments

must be returned by Distributor bymaking them availableat Distributor scosts for pick

up at the Distributor swarehouse or at the hospitals site no later than 10 days afterreceipt of such request. Distributorshall ensure that the sub-loan agreements for theInstruments withhospitals specificallyprovideforZimmer s and Biomet sright toclaimthe Instruments back. For the avoidanceof doubt the Instrumentsmay be claimed backbyZimmeror Biometif(i)Zimmer orBiomet wishto replace the InstrumentswithotherInstruments of equivalent or higherperformance and features and (ii)if the Distributor sProduct supplycontract witha specifichospitalis terminated or expiredand the hospitalhas used up the Products stock supplied by Distributorso that the hospital is no longerentitledto use the Instruments. Likewisethe Instrumentsshall be returned (or the

Distributorundertakes to have them returned by the hospitals) upon this Agreement stermination,subject to point (ii)above. To the extent practicallypossible, the Instrumentsmust be returned by Distributorin the same conditionthey were upon delivery, save fornormalwear and tear.

Further restrictions on DistributorosActivities- Distributor sWarranties andRepresentations

Further restrictions.Throughout the durationof the present Agreement theDistributoris forbidden to do any of the followingeither directlyor indirectly,in person or throughany appointed sub-distributor,agerÍ., intermediaryor Affiliates:

5.7

5.8

6.

6.1

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Zimmerbiomet/ Magna/ DistributionAgreement

(a) to activelysolicitsales of the Products outside the Teruitory.Distributorshall refrain

fromadvertising, maintaininga sales officeofferingProducts of Sellers or keeping astock of Sellers' Products outside theTenitory;(b) to engage withoutpriorwrittenauthorizationof Sellers in the Territorydirectlyor

indirectly orthrough its Affiliates,sub-distributors,agents, managers or employees,in the manufacture, sale,promotionor distributionof similaror analogous productswhich maybe competitivewiththe Products in any manner whatsoever duringtheterm of thisAgreement;

(c) to purport, in its correspondence or communicationsconcemingthe sale of theProducts, to be Zimmer'sor Biomet'sproxy, agent or representative;

(d) to give any explicit orimplicitguarantee or declaration or promise in relation to theProducts, or to undertake any other such obligationon Zimmer'sor Biomet'sbehalf,save as expressly authorizedin writing;

(e) to knowinglysell or deliver defective Products;(Ð to sell or make the Products availableto customers or other end users who are not

authorized to use them under applicable law;

(g) to use or to disseminate information orpromotional material mentioningthe Productsor any informationon intellectualpropertyor on Products, withoutobtaining

Zimmer'sor Biomet's

writtenapproval of that materialbeforehand;

(h) to describe the Products otherwise thanas indicated by Zimmeror Biomet;and

(i) to disclose information on Zimmer'sor Biomet's marketing strategies, activitiesorinitiatives,or anticipate in any way the launch of new Products, withoutobtainingZimmer'sor Biomet's priorwrittenapproval.

6.2 Distributor'srepresentations, warranties, undertakingsand acknowledgments.Distributorhereby represents, warrants, undertakes andlor acknowledgesto Sellers:(a) that it is a company dulyformedand stillincorporated underthe applicablelaws and

has obtainedall authorizations, licenses, and permits necessary to carry on theactivitiesrequired under this Agreement;(b) that is shall at all times conduct its activitiesunder this Agreement in strict

compliance with allapplicable rules,regulationsand laws now orhereafter in effectin the Territory;

(c) that the person signing and executingthis Agreement is dulyempowered to legallyrepresent the Distributorand dulycommit theDistributorto all obligationsprovidedfor herein;

(d) that neither the signingnor the execution of the present Agreement constitutesabreach of any other contractto whichthe Distributoris party;

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(e) that it is not in a state of insolvency, subject to bankruptcy, agreements with creditors

or other insolvency proceedings, and that, as of today, no applications for theinstitutions of such proceedings have been filed;(f) that it has adequate management, sales force and facilities (including warehouse

facilities, business offices and clerical staff) to acquire and maintain a reasonablestock of Products as required under Section 10 below and to sell and promote the saleof Products as herein provided and generally to perform all of its obligations underthis Agreement. Zimmer and Biomet shall have the right during business hours toinspect said Distributor s facilities including its warehouse and offices, subject toadvance notice of3 (three) business days; and

(g) that it is not entitled to any compensation and Zimmer or Biomet are not liable forany loss of sales resulting from any sales, active or passive, made by any other non-Serbian distributor or agent of the Sellers in the Territory.

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6.3

7.1

7.2

Sellers entitlement to audit and inspection. Zimmer and Biomet and their agents shall

have the right during Distributor s standard business hours, to inspect the matters listed inthis Agreement and examine the databases, data, records and books of Distributor, upon arequest submitted three (3) business days in advance to do so, where Zimmer s orBiomet s inspection request relates to the inspection of materials which Zimmer orBiomet reasonably believe are needed to enable them to assess Distributor s compliancewith all of its obligations, representations, warranties, acknowledgments andundertakings set forth in this Agreement andlor to respond to an inquiry of any regulatoryor any other governmental authority. The written request for inspection shall state withfull details of the reason for the inspection. The inspection shall be limited to information,databases, data, records and books relevant to Zimmer s or Biomet s legitimate purpose.

Distributor shall designate in writing immediately after having received Zimmer s orBiomet s audit request an employee to serve as Zimmer s or Biomet s contact person inconnection with the request for and the conduct of such inspection. Distributor shallpermit Zimmer and Biomet to conduct the audit and inspection pursuant to this Sectionduring the term of this Agreement and after this Agreement s expiration, non-renewal orearly termination, for that time period which is mandated by the statute of limitationsunder the applicable laws in respect of that matter.

7. Products Registration and PromotionProviding product documentation and registration reports. Zimmer and Biomet willtransfer to Distributor necessary documentation for registrations of the Products withhealth authorities in the Territory, if such registration is required. Further, Zimmer andBiomet shall make available, free of charge, such data and registration reports to theextent that they are available and required and will facilitate registration in the Territory.The Distributor is obligated to order only products that are registered in compliance withlocal registration requirements.

Registration of Products. Distributor shall arrange any local registrations, approvals,licenses or other official measures concerning the Products that are required or will berequired in the future within the Tenitory. Any costs or expenses in connection withobtaining such registration shall be for the account of Zimmer and Biomet, unlessotherwise agreed to by Distributor. Such registration shall be solely in the name ofZimmer or Biomet (depending of the Product), unless prohibited by applicable law, inwhich case they shall be held in trust for Zimmer and Biomet by Distributor and shall besubject to transfer or cancellation at Zimmer s or Biomet s direction. Zimmer and Biometwill hold responsibility for the Products as required by the Medical Device Directive(EECl93l42). Distributor shall promptly inform Sellers and send copies of anycorrespondence with the competent registration authority, including any approval records,

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7.3


submissions, local labels and package inserts. Upon request of Zimmer orBiomet,suchdocumentation shall be translated at the cost of ZimmeÍor Biomet,as the case may be.

Consequences of expiryor terminationon registrations. At the expirationorterminationof the Agreement, Distributorshall take allnecessary steps in order to assistand support withthe transfer of such registrations to Zimmer or Biomet or atZimmer'sorBiomet'sdirectionto a thirdparty.In addition,Distributorshall turn over to ZimmerandBiometall files relevant to Product registration.

Principlesapplicable to the Products promotionin the Territory.Withoutprejudiceto any other provisionsof this Agreement relevantto the Products' promotionin theTerritory, the followingspecificprovisionsshall also apply:

(a) Zimmerand Biometshall fromtime to timefurnishto Distributor,free of charge, andin reasonable quantities,literature,catalogues and technicalbrochures withrespect tothe Products. Distributorwillbear the cost of additional and specificadvertisingconducted by it withinthe Territory.Advertisingwillbe carried out in accordancewiththe relevant requirements detailed in this Section and Section 3.1;

(b) Distributorshall also establish each calendar year for the followingyear and informZimmerand Biometthereofno later than 15 October a promotionprogram,separating salesmen cycles and location,journaladvertising,brochures, mailingsandconventions;

(c) Distributorshall be free to utilizeall methods it deems desirable to promote the salesof the Products in the Territory,providedhowever, that any advertisingorpromotionalmaterial, regardless of format,generated by Distributorwithregard tothe Products shall be done withprioragreement fromZimmeror Biometand incompliance with Territoryregulation,and Sellers compliance policiesas referred to inSection 3.5 above;

(d) Distributoragrees to furnish to Zimmeror Biomet in advance, for priorapprovalpu{poses, copies of any new brochures it may issue includingany matters related tothe productclaims. Zimmerand Biometmay decide that modificationsare necessary

and should be made to these brochures if the wordingused is capable of increasingthe liabilityor obligationsof Zimmeror Biometor their suppliers to thirdparties, andin particular to towards Distributor'scustomers, or of otherwise adverselyaffectingSellers' interests;

(e) Distributorshall provide instructionto customers in the use of the Products and fieldservice for minorreplacement of such Products.

Incidentreportso Products' Complaint,Recall Procedures and FieldSafetyCorrectiveActionProcedures

7.4

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8.

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Reporting incidents. Distributor shall notify Zimmer or Biomet immediately (in any

case no later than one (1) business day of:(i) any o'incident" or "death / unanticipated serious deterioration in state of health

or, serious health threat" as defined in the Guidelines on a Medical DeviceVigilance System (MEDDEV 2-l2ll rev 5 as may be amended or revisedfrom time to time) involving Products in the Tenitory; reported to Distributoror that Distributor learns about regardless of the fact whether the productinvolved was originally sold by Distributor.

(ii) any complaints from users concerning the Products, packaging or Productinformation complying with the reporting requirements of any applicable law

and(iii) any medically related claims it is aware of concerning the Products in the

Territory

(hereinafter: "Reporting Incidents")

In so doing, Distributor shall follow the procedure set forth in Annex E.

8.2 Distributor's system for complaint collections. Distributor shall establish and maintainan appropriate system for collecting complaints from users concerning the Products,packaging or Product information complying with the reporting requirements of any

applicable law. In addition to the reporting requirement set out in Section 8.1 Distributorshall, when required, facilitate product recalls and corrective actions as set out below inSections 8.3 and 8.4.

Requests for a recall by Zimmer or Biomet. A product recall can be requested byZimmer, Biomet or Distributor in the event that there is a reasonable basis for safetyconcems relating to Products or as a result of other conditions mandated by applicablelaws, rules or regulations. The nature and urgency of any recall will be determined byZimmer or Biomet in consultation with Distributor. Once the decision to recall has beentaken, the recall witl be coordinated by Zimmer or Biomet and facilitated by the

Distributor. Distributor shall not submit any submission or report or other information toany competent authority without the prior written consent of Zimmer or Biomet. Zimmeror Biomet (as the case may be) shall bear the costs of any corrective actions and productrecalls, unless and to the extent that such FSCA or product recall was initiated for areasons attributable to or caused by the Distributor, in which case the costs attributable tothe Distributor shall be borne by Distributor.

8.1

8.3

Requests for a Field Safety Corrective Action by Zimmer or Biomet. A Field SafetyCorrective Action ("FSCA") can be requested by Zimmer and Biomet or the Distributorin the event that there is a reasonable basis for safety concerns relating to Products or as a

result of other conditions mandated by applicable laws, rules or regulations.The nature

and urgency of a FSCA will be determined by Zimmer and Biomet in consultation with

8.4

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the Distributor. Once the decision to proceed with a FSCA has been taken, the FSCA willbe coordinated by Zimmer or Biomet and facilitated by Distributor. In particular,Distributor shall inform all parties concerned by a Field Safety Notice (ooFSN ), and asappropriate, assist in withdrawing Products from the market, as specified in the FSN.Distributor shall further assist in communicating to Zimmer and Biomet the status of FSNreconciliation. The status of FSN reconciliation shall be communicated to:[email protected]. Distributor shall bear its own costs and expenses ofany FSCA.

8.5

9.1

9.2

Coordination with Health Authorities. 'Where required by local regulations, Distributormust use best efforts to coordinate required activities, related to FSCA and complaintreporting, with the local health authorities.

9. Sellers'\ilarranty and Limitation of Liability

Sellers's Warranty. The warranty and liability of Zimmer and Biomet are separate andlimited to the Products delivered. For the avoidance of doubt, Zimmer does not warrantor is liable for Products delivered by Biomet and vice versa. Zimmer and Biomet andtheir designees shall warrant the Products against any manufacturing defects or defectiveparts in accordance with the warranty forms then in effect for each type of Product andunder the conditions specified in such warranty. The remedies laid out in the warranty

form constitute the Distributor's exclusive remedy in case of non-conforming or defectiveProducts. Distributor undertakes to send Zimmer and Biomet a monthly statementindicating the types and quantities of Products sold to its customers within the Territoryduring the previous month and showing the serial number of the Products, if any, and allother useful information, in order to permit Zimmer's or Biomet's warranty to be honoredwhere necessary. Distributor shall furnish to Zimmer and Biomet any and all assistancereasonably required by it for the fulfillment of its warranty obligations for Products soldby Distributor in the Territory.

Sellers' Liability. Regardless of the cause of action, whether in tort, contract or

otherwise, in no event will Zimmer or Biomet be liable for any direct, indirect orconsequential damages, for loss of profit or similar caused by any act or failure to act ofthe Distributor or of persons for whom Distributor is responsible.

10. Inventory and Aftersales ServiceMinimum inventory. Beginning as of the effective date of this Agreement, Distributorshall further continue to maintain a minimum inventory of not less than twenty-fivepercent (25%) of the Minimum Purchase Amount with regard to Products of ZimmerBiomet. Distributor undertakes to maintain consignment inventory with all relevantfurther customers.

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11. Term and Termination

11.1 Term. This Agreement is effective starting from January 1,2016 and is concluded for aninitial term of three (3) years ending on January l, 2019 ( Initial Term ) ThisAgreement will automatically expire without any further notice being necessary upon theend of the Initial Term.

ll.2 Renewal. This Agreement may be renewed in writing by both Parties before the end ofthe Initial Term ( Renewal Term ), which renewal shall be for a maximum of two (2)years. Distributor acknowledges and agrees that it will only be eligible for a potentialRenewal Term (which, in any event, shall be subject to Sellers' express written consent) ifDistributor has achieved the Minimum Purchase Requirements during the Initial Term ofthe Agreement. Upon each Renewal Term, the Target Purchases and Minimum PurchaseRequirements as specified in Annex B shall be reconsidered by the Parties.

11.3 Sellers' termination rights for material breach. This Agreement may be terminated byZimmer and Biomet in the event of a material breach caused by Distributor.

V/ithout in any way limiting the foregoing, for pu{poses of this Section 11.3, Sellers areentitled to terminate this Agreement with immediate effect by providing notice toDistributor in the event that:

(a) there is a Change of Control at Distributor; or

(b) Distributor fails, with respect to any year during the Initial Term or the Renewal Termof the Agreement, to meet the Minimum Purchase Requirements provided for in thisAgreement; or

(c) Distributor has failed, thirty (30) days after being requested to do so, to reapply forrenewal under Sellers'due diligence program; or

(d) Distributor fails to comply with Sections 3.3 through 3.5, Section 6.1 or non-compliance with applicable laws and regulations promulgated by any governmentalor regulatory agency of any country with respect to the performance of its obligations,including but not limited compliance with the laws and regulations as outlined inSection 3 and Annex D.

ll.4 Legal consequences of termination by Sellers. In the event of termination of thisAgreement, Zimmer and Biomet shall have the obligation to repurchase from Distributorthe latter's inventory of Products, accessories and spare parts. Zimmer andlor Biomet (asthe case may be) shall within sixty (60) days following the Distributor's request to thatrespect repurchase or cause to be repurchased by a third party appointed by Zimmerand/or Biomet at the invoice price excluding VAT from Distributor, all or a portion of ,Distributor's inventory of Products, accessories and spare parts (at the choice of the IDistributor), provided that such Products are in good condition, not obsolete, and wherel

*Þo -delivered to Distributor less than twenty-four (24) months prior thereto. In such case, tne' äfFft(/,'ii;;'.1,i72a

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Products and parts to be repurchased shall be made available to Zimmerand/or Biomet

withinone(1)

month afterDistributorhas informedZimmer and/orBiomet(as the case

may be) of its decision to request repurchase of allor a portion of such Products or parts.For the avoidance of doubts, if the Parties have agreed that certain Products be suppliedto Distributoron consignment, then those Products stillin Distributor'sstock at the timeof termination shallnot be repurchasedby Zimmeror Biometand shall nevertheless bereturned to the latter as soon as practicalafter termination.

11.5 Parties' terminationrights. This Agreement may also be terminated immediatelyat theoptionof either Party (i) in the event of the commencement of proceedings inreceivership, bankruptcy,or insolvencyby oragainst the otherParty or (ii)upon the

executionby the other Party of anassignment

forthe benefit

ofthe creditors or

dissolutionor liquidationof its business, whethervoluntarilyor by a thirdParty or (iii)upon default inperformance by the other Party whichis not cured withinthirty(30) daysafter receipt of a formalnotice of such default from the non-defaultingpartyby registeredletter or (iv)in the event the other Party engages in illegaltransactions and behaves in amanner to harm its owncommercial reputationandlor that of the other Party.

11.6 General legal consequences of termination.Upon terminationof thisAgreement forany reason (includingforexpiration):(a) all relevant files and records concerning theProducts shallbe handed over to Zimmer

or Biomet by Distributorwithoutcharge,(b) Distributorshall immediatelycease any activityhowsoever connected or instrumental

to the Products' distributionin the Territory.Inter alia, and withoutany limitationthereto, DistributorwithoutZimmer'sor Biomet'swrittenconsent, shall not submitbids in response to any hospitals' callsfor tenders, includingwhere at the timeofterminationthe relevantbid documentation has been already prepared by Distributorand Zimmeror Biomethave contributedto it. Nevertheless, all available informationand details on any pending calls for tenders published by hospitals at the timeofterminationshall be providedto Zimmeror Biomet withoutundue delay.

12. Intellectual Propertyl2.l Intellectualproperty rights remain withSellers. Distributoracknowledges that

Zimmerand Biomet, itsAffiliatesor its suppliers are and shall remain the ownerof theformulae,designs, symbols, trademarks, tradenames, tradingnames, commercialnames,corporate names, divisionalnames, trivialnames, inventors'names, Internet domainnames (whether registered as of the date of thisagreement or that are registered thereafteron the basis of the aforesaid trademarks and names) copyrights,package dress, packageand productcolors, patents and all other copyrightablematerialsuch as but not limitedto

product literature,engineering or architecturaldrawings,catalogues, packaging designs,labeling,advertisingmaterial,audio-visualmaterial,and computer programs (hereinafter r,

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jointly with the Trademarks as below defined collectively referred to as Intellectual

Property ) relating to the Products or otherwiseentitled to make commercial use of the

Intellectual Property. Distributor acknowledges that it neither has nor shall secure by thisAgreement any right to any of Sellers', their Affiliates' or suppliers Intellectual Property.Distributor agrees that the title to and the right to use all such Intellectual Property shallat all times remain vested in Zimmer or Biomet, its Affiliates or its suppliers whether ornot such Intellectual Property is registered or recorded with the appropriate governmentagencies.

12.2 Limited grant of intellectual property rights to Distribttor. Zimmer and Biomethereby grant to Distributor, subject to all terms herein set out, a limited non-exclusive,non-transferable, non-assignable, royalty-free license to use the trademarks of Zimmerand Biomet relating to the Products (hereinafter the Product Trademarks ) or to theirbusinesses (the Corporate Trademarks and jointly the Trademarks ) solely inconnection with the performance by Distributor under this Agreement in the Territoryduring the term and pursuant to the terms and conditions of this Agreement. This license(i) is granted only to the extent that Distributor is reasonably required to use theTrademarks for the sale and marketing in the normal course of business under thisAgreement; and (ii) shall automatically terminate (A) upon revocation by Zimmer orBiomet of Distributor's right to use the Trademarks pursuant to the license granted herein,andlor (B) upon termination of this Agreement, and in the event of any of the foregoing,

Distributor shall immediately upon the relevant date cease using the Trademarks and thename of Zimmer or Biomet in any manner whatsoever.

12.3 Obligations of Distributor regarding licenses. The licenses under Section 12.2 aboveare granted to Distributor subject to the following additional and not exhaustive expresslimitations and undertakings by Distributor:

(a) not to alter the Trademarks nor in any way use them in combination with othertrademarks, symbols or marks apart from the Distributor's own company name,provided that such a usage shall comply with all other provisions hereunder;

(b) not to use the Trademarks in any way liable to harm them or the associated goodwilland in particular their reputation and recognition or their validity andlor distinctivecharacter and suitability (for instance through deceitful use of the Trademarks or useof the brand n¿ìme as a generic term);

(c) not to use the Trademarks or signs confusingly similar with them beyond the strictprovisions hereunder set out;

(d) to obey all Zimmer's and Biomet's instructions concerning the use and representationof the Products andlor Trademarks, including any instructions given when materialand information for supporting distribution are provided under the presentAgreement;

(e) not to alter the Products' packaging or labels;

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(f)not to register or use the Trademarks in its own name, nor any sign confusinglysimilar

therewithor other

distinctivesigns whichmay be linkedto ZimmerorBiomet,as a trademark, domainname, component of a complexor device trade markor in any other way, anywhere in the world,whether or not the Trademarks havealready been registered by Zimmer or Biometor are de facto trademarks or qualifyasatypical distinctivesign (i.e. product packaging);and

(g) whenever using the Trademarks under Zimmer'sor Biomet'sauthorizationhereunder, always to portraythe mark along withthe symbols indicatingthe nature ofits registered status and the relevant owner.

12.4 (Potential)violationof Sellers' intellectualproperty rights. IfDistributorbelieves thatthirdparties are infringing anyof said IntellectualPropertyor are passing-offtheirproducts as products of Zimmer orBiometthrough the use of names, labels or packagingsimilarto Zimmer'sor Biomet's, their Affiliates'or its suppliers' IntellectualProperty,Distributorshall notifyZimmerand Biomet immediatelybut shall not, withoutthe priorwrittenconsent of Zimmeror Biomet,notifyothers or bringany legal proceedings orenter intoany administrativeproceedings or take any other actionagainst any suchinfringementor passing-off.Distributorshall cooperate fullywithZimmerand Biomet,their Affrliates orsuppliers in the preparation or prosecutionof any legal proceeding oradministrativeproceeding.

12.5 Use of intellectualpropertyrights afterany expirationor termination.Followinganyexpirationor terminationof this Agreement, Distributorshall not make use of theIntellectualPropertyin any way. Ifany of such IntellectualProperty then forms a part ofa Company Name of Distributor,or of any company owned or controlledby or incommonwithDistributor then(whetheror not thiscircumstancehas been withtheconsent of Zimmr.lror Biometor otherwise), Distributorshall immediatelycause allnecessary steps to be taken to change such CompanyName. Further, Distributorshallremove the reference to Zimmeror Biomet orto any other IntellectualProperty that isowned by Zimmeror Biometfrom theCompany Name, if requested by ZimmerorBiometas a preconditionto its authorizationforDistributorto sell products in additionto

the Products.

12.6 Assignmentof intellectualproperty rights.Upon request by Zimme.ror Biometat anytime duringthe termof this Agreementor followingits expirationor termination,Distributorhereby assigns fo Zimmerand Biometor their designees, all rights, titles,andinterests in and to all IntellectualPropertyincluding,but not limitedto, materialpreparedby Distributor,relatingto the Products whichwouldnot be liable to copyrightprotectionwhichDistributormay have obtained inadvertentlyor otherwise,and Distributoragreesto take all necessary steps and to execute any all documents upon request of ZimmerofiBiometto effect this assignment to Zimmer andBiomet,theirAffiliatesor supplierí.)Immediatelyupon terminationof this Agreement, Distributorshall ;; ;; ;;,;;;rr'rj,@øøreference to its formerrole as a distributorof Sellers's Products and in this regafd

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Distributor shall remove all references to Zimmer and Biomet or their trademarks andtrade names or those of its Affiliates or suppliers from its stationary, catalogues andadvertising.

13. Indemnification

13.1 Distributor agrees to indemnifu and hold harmless Zimmer and Biomet, their Affrliatesand suppliers, and their respective directors, officers and employees against any and allclaims, demands, proceedings, losses, reasonable costs and expenses which may bebrought against, suffered or incurred by any of them in consequence of any error, mistakeor negligence on the part of Distributor or any of its employees, agents, sub-distributors

or sub-contractors, in storing, selling or distributing any of the Products.

13.2 Each of the Parties agrees to indemnify and hold harmless the other Party against any andall claims, demands, proceedings, losses, reasonable costs and expenses which may bebrought against, suffered or incurred by any ofthem in consequence ofany breach ofthisAgreement on the part of the breaching Party.

14. Mitigating actions in the event of hospital contracts' duration exceeding thisAgreement's termination or expiration.

l4.l General safe harbor principles for existing contracts. The Parties acknowledge thatupon termination or expiration of this Agreement (hereinafter Termination ) there maybe Product supply contracts which, although awarded by hospitals to Distributor prior toTermination, are in force and due to continue to apply for a given period of time overtermination. Considering the need for Distributor to secure that the Products may becontinued to be sourced from Zimmer or Biomet and supplied to hospitals up to the endof the supply contracts with the same, and of the concurrent need to safeguard Sellers'and Distributor's interests and rights, the Parties agree that they will take the mitigatingactions set out in this Section 14.

14.2 Mitigation plan. Within ten (10) business days of this Agreement's termination,Distributor shall provide Zimmer andlor Biomet with the following information: (a) acomplete list of all existing hospital supply contracts which as of the date of terminationhave been awarded to Distributor and are still in force (hereinafter the HSC ), detailingthe residual duration of each HSC and type of Products which are the object thereof (b)details of all Distributor's account receivables towards hospitals as of the date of theabove mentioned list, including the relevant payment terms or overdue dates. Uponsubmission of this information, the Parties shall meet and agree on a mitigation plan toenable, where possible, the smooth handover to Zimmer or Biomet or Zimmer's orBiomet's new distributor of the existing HSCs or, if this is not legally possible orpractical, to secure Zimmer's or Biomet's credit rights in respect of the Products and

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Instruments supplied to Distributor. In particular, the mitigation plan shall contemplate

and regulate each of the following actions:(a) Transfer of the HSCs to Zimmer or Biomet or their designated persons or entities in

the Tenitory at Zimmer s or Biomet s discretion; identification of all actionsnecessary to achieve this objective; implementation plan with allocation ofresponsibilities;

(b) If and to the extent that action under (a)above is not feasible, Zimmer or Biomet willagree to continue to supply the Products and provide the Instruments to Distributorunder all terms and conditions of this Agreement and subject to the followingadditional covenants:

(Ð Distributor within 30 (thirty) calendar days of Termination, shall inform allhospitals to which the HSCs refer of this Agreement s termination and that inspite of such termination Distributor will continue to supply the Products andInstruments sets as well as any related services up to the HSCs termination.V/ith the same letter, Distributor shall invite hospitals to revert directly toZimmer and/or Biomet or their designated persons or entities for any otherinquiries not concerned with the HSCs. The contents of this letter shall beagreed with Zimmer or Biomet prior to circulation;

(iÐ Distributor on the fifth (5tÐ business day of each calendar month shallprovide Zímmer

andBiomet with an updated list of information set out in

Section I4.2 above, with particular regard to the new Receivables accrued asto the date of the updated list;

(iiÐ Distributor within thirty (30) calendar days of Termination shall enter withSellers into a framework agreement for the assignment by way of security ofall Receivables.

14.3 Post Termination award of HSC. The same mitigation plan shall be implemented inrespect of HSC which are awarded to Distributor after termination, if the relevant bidoffers were submitted by Distributor prior to termination.

14.4 Damages. In the event that Distributor fails to comply with any of its obligations set outin Sections I4.2 and 14.3 within the prescribed deadlines, Zimmer and Biomet shall beentitled to damages from Distributor up to an overall total aggregate amount of 150.000Euro.

15. Miscellaneous

15.1 Condition Precedent for Validity of Agreement. This Agreement shall onlyeffective under the condition that Distributor has successfully completed thediligence process of Sellers and has been approved by Sellers as a distributor (the

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"Condition"). Until the Condition is fulfilled by Distributor or waived by Sellers, this

Agreement shall not come into full force and effect. Neither Party shall be liable to theother in any way for compensation or damages of any kind in connection with the non-fulfillment of the Condition.

15.2 Severability. If any provision of this Agreement is found by any competent authority tobe void, invalid or unenforceable, such provision shall be deemed to be deleted from thisAgreement and the remaining provisions of this Agreement shall continue in full force. Inthis event, the Agreement shall be construed, and, if necessary, amended in a way to giveeffect to, or to approximate, or to achieve a result which is as close as legally possible tothe result intended by the provision hereof determined to be void, illegal or

unenforceable.

15.3 \ilaivers. The failure by either Party at any time to enforce, in whole or in part, one ormore provisions hereof shall in no way be construed as a waiver of its rights to enforcesuch provision at any later time or to require the performance.

15.4 Relationship between Sellers and Distributor. The relationship between Sellers andDistributor established by this Agreement are those of suppliers and a purchaser, neitherparty acting as the legal representative of the other. Distributor may not consider itself, orhold itself out to be the agent of Zimmer or Biomet. In the performance of thisAgreement, Distributor shall at all times act as an independent contractor.

15.5 Assignment. This Agreement will be deemed to require the performance of personalservices by Distributor and may therefore not be assigned or transferred by Distributor.Zimmer and Biomet may freely assign to any of their Affiliates all or any of the rightsandlor obligations and delegate all or parts of its duties hereunder upon giving noticethereof to Distributor.

15.6 Entire Agreement. This Agreement amends and replaces the Distribution Agreement byand between Distributor and Zimmer effective as of 1 February 2015, togetherwith itsAnnexes constitutes the entire agreement between the parties hereto. The Partiesrepresent that, in entering in this Agreement, they do not rely upon any previousrepresentation, whether express or implied, oral or written, or any previous inducement oragreement of any kind or nature. All prior negotiations, representations, discussions,contracts or agreements concerning the subject matter hereof are cancelled or mergedherein. No amendments or modifications of the terms and provisions of this Agreementshall be binding on the Parties unless and until reduced to writing and duly signed by anofficer of the Party to be bound.

15.7 Amendments and Modifications. This Agreement may not be modified, amended,altered or supplemented, in whole or in part, except by a written agreement signed by the

Parties.

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15.8 This Agreementshall enter into force and become applicable on the date of its signature

by the authorized representatives of both Zimmer andDistributor.However,the

followingclauses and rights and obligations of the Parties envisaged thereunder shallstart to apply as of the momentof obtainingof the decisionon individualexemptionofthis Agreementby the Commissionfor Protectionof Competitionof the RepublicofSerbia, as follows:

(i) Exclusiveright ofdistributorshipconferred to the Distributorunder clause 2.1of this Agreement - but withoutaffectingthe DistributoÍ sright to act as non-exclusive distributorof Zimmer andBiometin the Territory,in accordancewithprovisions of this Agreement,as of the day of execution of thisAgreement by theParties,

(iÐ

(iiÐ(iv)

Clause 4.1 of this Agreementand Annex81 and AnnexB2to this Agreement,Clauses 6.1 a) and 6.1 b) of this Agreement,

Clause 10.1 of this Agreement.

The Parties shall mutuallyagree and cooperate to submit the request for individualexemptionof the above mentioned provisionsof this Agreement by the CommissionforProtectionof Competitionof the Republicof Serbia. The above mentionedclauses shallstay applicableforas longas individualexemptionissued by the Commissionfor

Protection of Competition ofthe Republicof Serbia is validand applicable.15.9 Governing law.ThisAgreement shallbe govemed by and interpreted in accordance with

the substantive laws of Switzerland,excludingits conflictof laws norTns.

15.10 Jurisdiction.Alldisputes or claims arising outof or in connection withthis Agreementincludingdisputes relating to its validity,breach, terminationor nullityshall be finallysettled under the Rulesof Arbitrationof the InternationalArbitralCentre of the AustrianFederal Economic Chamberin Vienna (ViennaRules) by one or three arbitratorsappointed in accordance withthe said Rules. Place of arbitrationshall be in Vienna,Austria.The number of arbitrators shall be three. The substantive lawof Switzerlandshall be applicable, excludingits conflictof laws norrns. The language to be used in thearbitrationshall be English.The emergency arbitratorprovisionsshall not apply.

[Signatures of Partíes followon the next page. Remaínder ofpage ìntentíonallyleftblank.J

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Annex A

Annex A1

List of products of Zimmer:

All Zimmer Products, excluded the product lines: Dental

Distributor ís entitled to pløce orders for the product Zìmmer Unìcompartmentøl KneeSystem (*ZUK ) only to the extent necessary to fulfill its obligations related to on-going,already awarded tenders or supply contracts and to order only the quantities of ZUK strictlyneeded to fulfill its obligations related to on-going, already awarded tenders or supply contracts.

Starting from the Execution Date, Distributor shall not commit or participate to, any agreement,tender advice, or tender publication for the supply of the product ZUKinthe Tenitory.

Annex A2

List of products of Biomet:

All Biomet Products lines, with exclusion of the Products lines: Dental and Microfixation

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Annex Bl and B2

Target Purchases for Products of Zimmer and Biomet:

Year 2016 January 1,2016 - December 31,2016) - 3 Million USD three million US Dollars)in total cumulatively for both Zimmer and Biomet

Minimum Purchase Requirements for Products of Zimmer and of Biomet:

60Yo of the Target Purchases

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Axunx C

Annex ClPrices for Products of Zimmer:

The price list will be communicated by Zimmer to Distributor on a yearly basis

Annex C2

Prices for Products of Biomet:

The price list will be communicated by Biomet to Distributor on a yearly basis

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Annex D

COMPLIANCE \ilITH LA\il

In Section 3.5 Distributor agrees that in performing its obligations under this Agreement, it shallcomply at all times, with all applicable laws, regulations and governmental orders of thegovemment of the Territory and of any jurisdiction in which Distributor performs its obligationsunder this Agreement or that could otherwise be applicable.

I. General Compliance with Law1 Distributor will cause all Affiliates, sub-distributors and agents, or the respective

directors, officers, employees, agents or representatives of suchentities, or any other

person or entity acting on behalf of Distributor or any of its subsidiaries in connectionwith Distributor's performance of its obligations hereunder (hereinafter the RelevantAgents ) to comply, with all applicable laws, regulations and govemmental orders of thegovernment of the Territory and of any jurisdiction in which Distributor performs itsobligations under this Agreement or that could otherwise be applicable.

2 Distributor also agrees to advise Sellers of any material change, modification or new lawwhich may affect the performance of Distributor or Sellers with respect to the Parties'obligations hereunder.

3The laws

thatDistributor and its Relevant Agents must abide by and comply with

include, but are not limited to the Organization for Economic Co-operation andDevelopment Convention on Combating Bribery of Foreign Public Offrcials inInternational Business Transactions ( OECD Bribery Convention ) and its nationalcountry enabling legislation; the U.S. Foreign Comrpt Practices Act ( FCPA ); theItalian Legislative Decree 231 of 8 June 200I ( ltalian Law 231 ); the U.K. Bribery Act2010 ( Bribery Act ); and any other law that may govern its activities from time to time,including, but not limited to, any law or regulation prohibiting bribery in any form.

4 In addition, in performing under this Agreement, Distributor and its Relevant Agents willcomply with all policies of Sellers, including but not limited to the Sellers Code ofBusiness Conduct and Ethics, Sellers's Anticorruption Policy, Sellers's InternationalDistributor Compliance Manual and any and all corporate policies or procedures issuedfrom time to time by the Zimmer group. Distributor hereby specifically acknowledgesthat it has received a copy of the Zimmer Code of Business Conduct and Ethics, has readand understood the same and advised relevant personnel of its content. Distributorthat it will abide by, and will cause all of its Relevant Agents to comply with theseBy way of example and not limitation, Distributor must not offer, pay, or promise to þãY,any money, advantage, or item of value, directly or indirectly, to any person, includingany govenìment ofhcial, to perform improperly, or to reward a person for the improperperformance of, or to obtain a business advantage, a relevant function related to thisAgreement or its obligations. For these purposes, a government official will include

(

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5

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any employee of any govemmental entity or in which the government owns an interest, apolitical party, or a public international organization, ot any political party official, or anycandidate for public office in any jurisdiction, and will include, but not be limited to, anyhealth care professional in a state sponsored health care system andlor facility. A relevant function will include any function of a public nature, any activity connectedwith a business, any activity performed in the course of a person's employment, and anyactivity performed by or on behalf of Distributor, Sellers, or any other entity.

Distributor also will not make any kind of payments or make offers of any other kind ofbenefits to any health care professionals in connection with the sale or implantation of theProducts. Further, Distributor will not enter into any consulting agreement or otheragreements with health care professionals for any services related to Zimmer or BiometProducts without Sellers' prior written approval.

Distributor represents that it has fully disclosed, and will continue to fully disclose, toSellers if any person employed by or connected with it or with any of its RelevantAgents, during the term of this Agreement, becomes a Government Official of anygovernmental agency or corporation owned by or organized under the laws of anygovernment of the Territory or of any jurisdiction in which Distributor's obligationsunder this Agreement are performed. Distributor further represents that no part of theproceeds of the sale of the Products or any, if any, paid hereunder will inure to or for thebenefit of any person, including any Government Offrcial, if such payment is in violation

of any applicable law or regulation, including but not limited tothe FCPA, the Bribery

Act, Italian Law 231, or the OECD Bribery Convention.

Distributor agrees that it will maintain accurate books, records and accounts and it willnot make, or cause to be made, any entries in the books, records, and accounts ofDistributor or its Relevant Agents that do not accurately and fairly reflect transactionsand the distribution of Distributor's or the Relevant Agent's assets.

If and when requested to do so by one or both Sellers, Distributor will certify in writingin a manner prescribed by Sellers, its compliance with the terms and conditions of thisAgreement.

Distributor agrees that should it become aware of any behavior by itself or its RelevantAgent(s) that violates or is likely to violate any applicable law andlor regulation,including, but not limited to, the FCPA, the Bribery Act, the OECD Bribery Convention,and any other applicable law or regulation prohibiting bribery in any form, Distributorwill immediately notify Sellers through Sellers' compliance websitewww.ethicspoint.com, which provides global reporting telephone numbers or on-linereporting options.

Distributor will adopt an effective anti-corruption policy, supporting the compliance of itspersonnel with the principles inherent in this Annex within three (3) months after signingthis Agreement and will provide a copy of that anti-comrption policy to Sellers upon firstrequest of Zimmer or Biomet.

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Distributor and its Relevant Agents agree to participate in anti-comrption training asreasonably requested by Zimmer or Biomet, which will include at a minimum on-linetraining.

Zimmer and Biomet may on an annual basis audit the activities and records of Distributoror its Relevant Agents as those records pertain to the Products or other items subject tothis Agreement. Distributor acknowledges that should Zimmer or Biomet be made orbecome aware of any allegations, suspicions or evidence of improper or unethicalconduct that would raise questions concerning compliance with this Annex, then Sellersare entitled to fully investigate such allegations, in which event Distributor shall fullycooperate in a timely manner and cause its Relevant Agents to cooperate fully with suchinvestigation by Sellers or any third party appointed by Zimmer or Biomet to perform

such investigation.In the event Zimmer or Biomet, directly or indirectly, initiate an investigation, Sellerswill not be liable to Distributor for any claims, losses or damages whatsoever related toits decision to withhold payments or suspend the shipment of Product under this Annex.

If pursuant to an investigation conducted by Zimmer or Biomet or otherwise, Sellersconclude, based on a good faith belief, that Distributor or any of its Relevant Agents haveviolated the representations made by Distributor under this Annex, Sellers are entitled toterminate, with immediate effect, this Agreement and any other agreement Distributor orany of its Relevant Agents may have entered into with Sellers or any of their A

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