---

---

•	Trademarks for our VNS therapy systems, the VNS Therapy® System, the VITARIA™ System and our proprietary Pulse generators products: Model 102 (Pulse™), Model 102R (Pulse Duo™), Model 103 (Demipulse®), Model 104 (Demipulse Duo®), Model 105 (AspireHC®) and the Model 106 (AspireSR®).

•	Trademarks for our Oxygenators product systems: Inspire™, Heartlink™ and Connect™.

•

Trademarks for our line of surgical tissue and mechanical valve replacements and repair products: MitroflowTM, Crown PRTTM, Solo SmartTM, Crown PRTTM, Solo SmartTM, PercevalTM, Carbomedics StandardTM, Top HatTM, Reduced Series Aortic ValvesTM, Carbomedics Carbo-SealTM, Carbo-Seal ValsalvaTM, Carbomedics StandardTM, OrbisTM and OptiformTM, and Mitral valve repair products: Memo 3DTM, Memo 3D ReChordTM, AnnuloFloTM and AnnuloFlexTM.

•	Trademarks for our implantable cardiac pacemakers and associated services: REPLY 200TM, ESPRITTM, KORA 100TM, SafeRTM, the REPLY CRT-PTM and the remede® System.

•	Trademarks for our Implantable Cardioverter Defibrillators and associated technologies: the INTENSIATM, PLATINIUMTM, and PARADYMTM product families.

---

•	Trademarks for our cardiac resynchronization therapy devices, technologies services: SonRTM, SonRtipTM, SonR CRTTM, the INTENSIATM, PARADYM RFTM and PARADYM 2TM product families and the Respond CRTTM clinical trial.

•	The trademarks for heart failure treatment product, Equilia™.

---

---

---

•	Cardiac Surgery (Transitional Period 2015 net sales of $148 million)

◦	Cardiopulmonary

◦	Heart Valves

•	Cardiac Rhythm Management (Transitional Period 2015 net sales of $52 million)

•	Neuromodulation (Transitional Period 2015 net sales of $215 million)

---

---

	Heart-lung machines. The heart-lung machine (“HLM”) product group includes heart-lung machines, heater-coolers, related cardiac surgery equipment and maintenance services.

Oxygenators and perfusion tubing systems. The oxygenators product group, which includes oxygenators and other disposable devices for extracorporeal circulation, also achieved significant growth, especially in the United States, Europe and Japan, largely driven by the successful rollout of the new InspireTM, HeartlinkTM and ConnectTM system. The Inspire range of products, comprised of 12 models, will enable perfusionists to replace the existing oxygenator lines with more advanced systems capable of delivering better performance and greater flexibility. The total modularity of this new range of products will also help reduce production time and costs, providing perfusionists with a more customized approach to further benefit patients.

	Autotransfusion systems. One of the key elements for a complete blood management strategy is autotransfusion, which involves the collection, processing and reinfusion of the patient’s own blood that is lost at the surgical site during the peri-operative period.

	Cannulae. Our cannulae product family, which is part of the oxygenator product group, are perfusion tubing sets used to connect the extracorporeal circulation to the heart of the patient during cardiac surgery.

---

Tissue heart valves. Our tissue valves include the MitroflowTM aortic pericardial tissue valve with phospholipid reduction treatment (“PRT”) which is designed to mitigate valve calcification, and the Crown PRTTM and Solo SmartTM aortic pericardial tissue valves. Crown PRTTM is the latest advancement in stented aortic bioprosthesis technology, featuring surgeon-friendly design, PRT technology, and state-of-the-art hemodynamic and durability performance. Crown PRTTM enables intuitive intraoperative handling through a short rinse time, enhanced ease of implant through visible markers and improved radiographic visualization through dedicated X-ray markers. Our Solo SmartTM aortic pericardial tissue valve is an innovative, completely biological aortic heart valve with no synthetic material and a removable stent. Solo SmartTM provides the ease of implantation of a stented valve with the hemodynamic performance of a stentless valve.

Self-anchoring tissue heart valves. PercevalTM is LivaNova’s sutureless bioprosthetic device designed to replace a diseased native valve or a malfunctioning prosthetic aortic valve using either traditional or minimally invasive heart surgery techniques. PercevalTM incorporates a unique technology that allows 100% sutureless positioning and anchoring at the implantation site. This, in turn, offers the potential benefit of reducing the time the patient spends in cardiopulmonary bypass. To date, over 12,000 patients worldwide benefit from the PercevalTM valve.

---

---

---

---

---

•	Cardiac Surgery:

◦	Cardiopulmonary Products: All Cardiopulmonary products face competition from at least two other large companies, and some regional competitors, although not all competitors are present in all product lines. All products are sold in a competitive market where pricing can be a relevant factor.

•	Heart Valves: We compete with three large competitors, and pricing is a significant factor.

•	CRM: We compete with four large competitors, and features offered and pricing are significant competitive factors.

•	Neuromodulation: We face competition from a large competitor in Europe and a smaller competitor in the United States.

---

•	The FDA’s Quality System Regulation (“QSR”) under section 520 of the federal Food, Drug and Cosmetic Act (“FDCA”) and its implementing regulations at 21 C.F.R. Part 820.

•	The International Standards Organization - (“ISO”) EN ISO 13485:2012, Medical devices - Quality management systems.

•	The Independent certification bodies, DEKRA, LNE/G-MED and TUV SUD act as our notified bodies to ensure that our manufacturing quality systems comply with ISO 13485:2003.

•	The European Council Directives 93/42/EEC and 90/385/EEC, ISO 13485, which relates to medical devices and active implantable medical devices.

•	The U.S. Environmental Protection Agency (“EPA”) for the regulation environmental and employee health and the Occupational Health and Safety Assessment System (“OSHAS”).

•	The European Union Registration, Evaluation, Authorization and Restriction of Chemicals (“REACH”).

•	Italian regulations under the Integrated Environmental Authorization acts

•	ISO 14001 certification

---

---

•	the QSR, which governs, among other things, how manufacturers design, test, manufacture, modify, label, exercise quality control over and document manufacturing and quality issues regarding their products;

•	Establishment Registration, which requires establishments involved in the production and distribution of medical devices, intended for commercial distribution in the United States, to register with the FDA;

•	Medical Device Listing, which requires manufacturers to list the devices they have in commercial distribution with the FDA;

•	labeling and claims regulations, which require that all advertising and promotion of devices be truthful, not misleading and fairly balanced and provide adequate directions for use, and that all claims be substantiated;

•	prohibition of marketing devices for off-label uses, including requirements relating to dissemination of articles and information and responding to unsolicited requests for off-label information;

•	medical device reporting (“MDR”) regulations, which requires reporting to the FDA if a device may have caused or contributed to a death or serious injury, or if a device has malfunctioned and would be likely to cause or contribute to a death or serious injury if the malfunction were to recur;

•	reporting and record keeping for certain corrections or removals initiated by a manufacturer to reduce a risk to health posed by a device or to remedy a violation of the FDCA caused by the device that may present a risk to health;

•	new statutory and regulatory requirements for Unique Device Identifiers (“UDIs”) on devices and submission of certain information about each device to the FDA’s Global Unique Device Identification Database (“GUDID”); and

•	in some cases, ongoing monitoring and tracking of a device’s performance and periodic reporting to the FDA of such performance results.

•	untitled letters or warning letters;

•	fines, injunctions and civil penalties;

•	mandatory recall or seizure of our products;

•	administrative detention or banning of our products;

•	operating restrictions, partial suspension or total shutdown of production;

•	refusing our request for 510(k) clearance or pre-market approval of new product versions;

•	revocation of 510(k) clearance or pre-market approvals previously granted; and

•	criminal prosecution and penalties.

---

---

---

---

---

---

---

---

•	changes in the general condition of the economy and other factors unrelated to our operating performance, including the valuation of the British pound versus other currencies, people’s expectations (favorable or unfavorable) as to our likely growth, or other factors;

•	regulatory activities and announcements, including activities related to the FDA quality system regulation;

•	uncertainties associated with governmental and regulatory inquiries and investigations;

•	the introduction of new products or product enhancements by us or our competitors;

•	national and regional coverage determinations by third‑party payors, including private insurance companies, Medicare, state Medicaid programs and other international bodies responsible for coverage determinations;

•	results of studies regarding the safety and efficacy of our products;

•	results of studies regarding the safety and efficacy of drugs or devices that are competitive or potentially competitive to our products;

•	clinical trial results and/or regulatory approvals regarding devices that are potential competitors to our products;

•	annual and quarterly variations in our sales and operating results;

•	announcements of significant contracts, mergers, acquisitions or capital commitments;

•	our ability to obtain and maintain favorable coverage and reimbursement for our products;

•	our ability to find licensees for some of our technology and the terms of any licenses we grant;

•	security analyst expectations and predictions;

•	changes in financial estimates by securities analysts;

•	additions or departures of key management or other personnel;

•	the potential identification of material weaknesses in our internal controls over financial reporting;

•	disputes or other developments with respect to intellectual property rights or other potential legal actions;

•	uncertainties associated with litigation; and

•	false or misleading reports published by investors intended to drive our stock price up or down for the purpose of profiting from transactions in our stock.

•	The ability of our sales force to effectively market and promote our products, and the extent to which those products gain market acceptance;

•	the existence and timing of any approvals, changes, or non-coverage determinations for reimbursement by third-party payors;

•	the rate and size of expenditures incurred on our clinical, manufacturing, sales, marketing and product development efforts;

•	our ability to obtain and retain qualified personnel;

---

•	the availability of key components, materials and contract services, which depends on our ability to forecast sales, among other things;

•	investigations of our business and business-related activities by regulatory or other governmental authorities;

•	variations in timing and quantity of product orders;

•	temporary manufacturing interruptions or disruptions;

•	the timing and success of new product and new market introductions, as well as delays in obtaining domestic or foreign regulatory approvals for such introductions;

•	increased competition, patent expirations or new technologies or treatments;

•	product recalls or safety alerts;

•	litigation, including product liability, patent, employment, securities class action, stockholder derivative, general commercial and other lawsuits;

•	the financial health of our customers, and their ability to purchase our products in the current economic environment; and

•	other unusual or non-operating expenses, such as expenses related to mergers or acquisitions, may cause operating result variations.

•	imposes an annual excise tax of 2.3% on any entity that manufactures or imports medical devices offered for sale in the United States. Due to subsequent legislative amendments, the excise tax has been suspended from January 1, 2016 to December 31, 2017, and, absent further legislative action, will be reinstated starting January 1, 2018;

•	establishes a new Patient-Centered Outcomes Research Institute to oversee and identify priorities in comparative clinical effectiveness research in an effort to coordinate and develop such research; and

•	implements payment system reforms including a national pilot program on payment bundling to encourage hospitals, physicians and other providers to improve the coordination, quality and efficiency of certain healthcare services through bundled payment models.

---

---

---

•	design, development and manufacturing;

•	testing, labeling, packaging, content and language of instructions for use, and storage;

•	clinical trials;

•	product safety;

•	pre-market clearance and approval;

•	marketing, sales and distribution (including making product claims);

•	advertising and promotion;

•	product modifications;

•	recordkeeping procedures;

•	reports of corrections, removals, enhancements, recalls and field corrective actions;

•	post-market surveillance, including reporting of deaths or serious injuries and malfunctions that, if they were to recur, could lead to death or serious injury;

•	complying with the new federal law and regulations requiring Unique Device Identifiers on devices and also requiring the submission of certain information about each device to the FDA’s Global Unique Device Identification Database; and

•	product import and export laws.

---

---

---

---

•	untitled letters, warning letters, fines, injunctions or consent decrees;

•	customer notifications or repair, replacement, refund, recall, detention or seizure of products;

•	operating restrictions or partial suspension or total shutdown of production;

•	refusal to grant or delay in granting 510(k) clearance or PMA approval of new products or modified products;

•	withdrawing 510(k) clearances or PMA approvals that have already been granted;

•	refusal to grant export approval for our products; or

•	civil penalties or criminal prosecution.

---

---

•

the Anti-Kickback Statute, which prohibits, among other things, persons from knowingly and willfully soliciting, receiving, offering or paying remuneration, directly or indirectly, in exchange for or to induce either the referral of an individual for, or the purchase, order or recommendation of, any good or service for which payment may be made under federal healthcare programs, such as the Medicare and Medicaid programs. A person or entity does not need to have actual knowledge of the Anti-Kickback Statute or specific intent to violate it to have committed a violation; in addition, the government may assert that a claim including items or services resulting from a violation of the Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the False Claims Act;

•

federal civil and criminal false claims laws which prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, claims for payment from Medicare, Medicaid or other federal third-party payors that are false or fraudulent. Private individuals can file suits on behalf of the government under the False Claims Act, known as “qui tam” actions and such individuals, commonly known as “whistleblowers,” may share in any amounts paid by the entity to the government in fines or settlement. When an entity is determined to have violated the False Claims Act, it may be required to pay up to three times the actual damages sustained by the government, plus civil penalties for each separate false claim;

•	the federal Civil Monetary Penalties Law, which prohibits, among other things, offering or transferring remuneration to a federal healthcare beneficiary that a person knows or should know is likely to influence the beneficiary’s decision to order or receive items or services reimbursable by the government from a particular provider or supplier;

•	federal criminal laws that prohibit executing a scheme to defraud any federal healthcare benefit program or making false statements relating to healthcare matters. Similar to the federal Anti-Kickback Statute, a person or entity does not need to have actual knowledge of the statute or specific intent to violate it to have committed a violation;

•	HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act, which governs the conduct of certain electronic healthcare transactions and protects the security and privacy of protected health information;

•

the federal Physician Payment Sunshine Act, which requires manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) to report annually to the Centers for Medicare & Medicaid Services (“CMS”) information related to payments or other “transfers of value” made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors) and teaching hospitals, and requires applicable manufacturers and group purchasing organizations to report annually to the government ownership and investment interests held by the physicians described above and their immediate family members and payments or other “transfers of value” to such physician owners. Manufacturers are required to submit reports to CMS by the 90th day of each calendar year;

•

the FCPA, which prohibits corporations and individuals from paying, offering to pay or authorizing the payment of anything of value to any foreign government official, government staff member, political party or political candidate in an attempt to obtain or retain business or to otherwise influence a person working in an official capacity; the U.K. Bribery Act, which prohibits both domestic and international bribery, as well as bribery across both public and private sectors; and bribery provisions contained in the German Criminal Code, which, pursuant to draft legislation being prepared by the German government, may make the corruption and corruptibility of physicians in private practice and other healthcare professionals a criminal offense; and

•

analogous state and foreign law equivalents of each of the above federal laws, such as anti-kickback and false claims laws which may apply to items or services reimbursed by any third-party payor, including commercial insurers; state laws that require device companies to comply with the industry’s voluntary compliance guidelines and the applicable compliance guidance promulgated by the federal government or otherwise restrict payments that may be made to healthcare providers and other potential referral sources; state laws that require device manufacturers to report information related to payments and other transfers of value to physicians and other

---

---

---

•	product quality, reliability and performance;

•	product technology;

•	breadth of product lines and product services;

•	ability to identify new market trends;

•	customer support;

•	price;

•	capacity to recruit engineers, scientists and other qualified employees; and

•	reimbursement approval from governmental payors and private healthcare insurance providers.

---

•	local product preferences and product requirements;

•	longer-term receivables than are typical in the EU or the United States;

•	fluctuations in foreign currency exchange rates;

•	less intellectual property protection in some countries outside the EU or the United States;

•	trade protection measures and import and export licensing requirements;

•	workforce instability;

•	political and economic instability;

•

the FCPA, which prohibits corporations and individuals from paying, offering to pay or authorizing the payment of anything of value to any foreign government official, government staff member, political party or political candidate in an attempt to obtain or retain business or to otherwise influence a person working in an official capacity; the U.K. Bribery Act, which prohibits both domestic and international bribery, as well as bribery across both public and private sectors; and bribery provisions contained in the German Criminal Code, which, pursuant to draft legislation being prepared by the German government, may make the corruption and corruptibility of physicians in private practice and other healthcare professionals a criminal offense; and

•

analogous state and foreign law equivalents of each of the above federal laws, such as anti-kickback and false claims laws which may apply to items or services reimbursed by any third-party payor, including commercial insurers; state laws that require device companies to comply with the industry’s voluntary compliance guidelines and the applicable compliance guidance promulgated by the federal government or otherwise restrict payments that may be made to healthcare providers and other potential referral sources; state laws that require device

---

---

---

---

•	the presence or absence of adequate internal controls and/or significant fraud in the financial systems of acquired companies;

•	adverse developments arising out of investigations by governmental entities of the business practices of acquired companies;

•	any decrease in customer loyalty and product orders caused by dissatisfaction with the combined companies’ product lines and sales and marketing practices, including price increases;

•	our ability to retain key employees; and

•	the ability of the combined company to achieve synergies among its constituent companies, such as increasing sales of the combined company’s products, achieving cost savings and effectively combining technologies to develop new products.

---

•	managing a significantly larger company;

•	coordinating geographically separate organizations;

•	the potential diversion of management focus and resources from other strategic opportunities and from operational matters;

•	retaining existing customers and attracting new customers;

•	maintaining employee morale and retaining key management and other employees;

•	integrating two unique business cultures, which may prove to be incompatible;

•	the possibility of faulty assumptions underlying expectations regarding the integration process;

•	consolidating corporate and administrative infrastructures and eliminating duplicative operations;

•	coordinating distribution and marketing efforts;

•	integrating information technology, communications and other systems;

•	changes in applicable laws and regulations;

•	managing tax costs or inefficiencies associated with integrating the operations of the combined company;

•	unforeseen expenses associated with the Mergers; and

•	effecting actions that may be required in connection with obtaining regulatory approvals.

---

---

---

---

---

---

---

---

---

---

(1)	On October 19, 2015, the Mergers of Cyberonics and Sorin were consummated. Cyberonics was considered the accounting acquirer and LivaNova became the successor organization to Cyberonics. Historical data presented is Cyberonics’ data. Sorin’s data, as the accounting acquiree of LivaNova following completion of the Mergers, is included for the period October 19, 2015 to December 31, 2015.

(2)	During fiscal year 2011, we reduced our valuation allowance on our U.S. net operating loss carryforward deferred tax asset and recorded income tax benefits of $8.9 million. In addition, during fiscal year 2011, we recorded an income tax benefit of $9.0 million related to claiming a worthless stock deduction with respect to the shares we own in Cyberonics Europe BVBA.

(3)	During fiscal year 2011, we repurchased our Senior Subordinated Convertible Notes (“Convertible Notes”) that were issued in September 2005 in privately negotiated transactions. During fiscal year 2012, in connection with the settlement of litigation relating to the Convertible Notes, we were required to retire the Convertible Notes that were tendered at par.

---

---

---

---

---

---

---

---

(1)	Includes those countries in Europe where LivaNova has a direct sales presence. Countries where sales are made through distributors are included in Rest of World.

(1)	Product sales represent revenue from sales of generators, leads and other items related to the VNS Therapy System. Unit sales are based on the number of generators sold.

(2)	Licensing revenue represents the amortization of a $9.5 million upfront payment received for certain intellectual property in fiscal year ended April 25, 2008.

---

---

---

---

---

---

---

---

(1)	Government bid guarantees include such items as unconditional bank guarantees, irrevocable letters of credit and bid bonds.

(2)	Commercial guarantees include our Canadian production site lease guarantee of $4.1 million.

(3)	Tax guarantees include the Milan VAT Authority security of €10.2 million.

(4)	Operating lease commitments include facilities, office equipment and automobiles.

(5)	Interest payments reflect the contractual interest due on our outstanding debt and exclude the impact of interest rate swap agreements. Refer to “Note 14. Financing Arrangements” in our consolidated financial statements included in this Report on Form 10-K/T.

(6)	Minimum royalty fees are payable to Flint Hills L.L.C. for cardiac-based seizure detection intellectual property. Other royalty payments are not disclosed as they cannot be determined at this time.

(7)	Unrecognized tax benefits of $20.2 million are not reflected in the above schedule due to our inability to make a reasonably reliable estimate of the timing of any income tax payments.

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

•	Level 1 - Inputs are quoted prices in active markets for identical assets or liabilities.

•	Level 2 - Inputs include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, and inputs (other than quoted prices) that are observable for the asset or liability, either directly or indirectly.

•	Level 3 - Inputs are unobservable for the asset or liability.

---

---

---

---

---

(1)	To record the fair value of LivaNova ordinary shares issued to Sorin shareholders (in thousands except per share data and Sorin Exchange Ratio):

(2)

Each Sorin share award (other than a Sorin stock appreciation right) granted prior to the Sorin merger effective time accelerated, vested and was converted into the right to receive LivaNova ordinary shares based on the Sorin Exchange Ratio. The total fair value of the replacement awards is $25.2 million, including $9.2 million attributable to pre-combination services and allocated to consideration transferred to acquire Sorin. Of the remaining $16.0 million, $8.3 million was recognized immediately in the post-combination period and $7.7 million will be recognized over the post-combination service period to February 28, 2017 due to the service period requirements of the awards. Refer to “Note 18. Stock-Based Incentive Plans” for further discussion of treatment of equity awards.

(3)

As of October 16, 2015 there were 3,815,824 Sorin stock appreciation rights. Each Sorin stock appreciation right granted prior to the Sorin merger effective time accelerated, vested and was converted into the right to receive 0.0472 LivaNova stock appreciation right based on the Sorin Exchange Ratio. The total fair value of the replacement stock appreciation rights is $3.8 million, including $2.2 million attributable to pre-combination services and allocated to consideration transferred to acquire Sorin. The remaining $1.6 million was recognized immediately in the post-combination period. Refer to “Note 18” for further discussion of treatment of equity awards.

---

---

---

---

---

---

(1)	During the transitional period April 25, 2015 to December 31, 2015, our six-month CD matured, was re-invested in a three-month CD and was classified with cash equivalents in the consolidated balance sheet.

(1)	ImThera Medical, Inc. is a U.S. company developing a neurostimulation device system for the treatment of obstructive sleep apnea.

(2)

Cerbomed GmbH is a European company developing a transcutaneous vagus nerve stimulation device for the treatment of epilepsy. During the transitional period April 25, 2015 to December 31, 2015, we recorded an other-than-temporary impairment of $5.1 million against our investment in Cerbomed. We recorded the charge in Impairment of Investments in the consolidated statement of income (loss). Refer to “Note 13. Fair Value Measurements.”

(3)	Rainbow Medical Ltd. is an Israeli company that seeds and grows companies developing medical devices in a diverse range of medical fields.

---

(1)	We have outstanding loans to Caisson Interventional LLC and to Highlife S.A.S for $3.6 million included in Other Assets on the consolidated balance sheet.

---

(1)	This contingent payment arose as a result of the acquisition of Cellplex Pty Ltd. in September 2015, and was valued using the Black Scholes method at the date of the Mergers.

---

---

---

•	certain financial ratios calculated based on the Sorin consolidated financial statements;

•	subordination clauses, based on which the loan cannot be subordinated to other loans, with the exception of loans given preference deriving from legal obligations;

•	negative pledge clauses that place limits on the issue of collateral;

•	other customary clauses for loans of this type, including limits on LivaNova’s asset disposals.

---

•	intercompany financial accounts and loans not denominated in U.S. dollars, recording a loss for $5.1 million;

---

•	short and long-term loans denominated in Euro, recording a loss for the amount of $7.9 million, of which $4.8 million relates to a foreign exchange derivative arrangement on the EIB long-term loan. Such derivative arrangements have been discontinued in January 2016;

•	revenues denominated in British pounds and Japanese yen for the period from date of the Mergers to December 31, 2015, recording a gain for $0.2 million.

---

---

---

---

---

---

---

---

---

---

(1)	We do not plan to pay dividends.

(2)	We use yield rates on U.S. Treasury securities for a period that approximated the expected term of the award to estimate the risk-free interest rate.

(3)	We estimated the expected term of the awards granted using historic data of actual time elapsed between the date of grant and the exercise or forfeiture of options or SARs for employees. For consultants, the expected term is the remaining time until expiration of the option or SAR.

(4)	Refer to “Note 2. Basis of Presentation, Use of Accounting Estimates and Significant Accounting Policies-Stock-based Compensation” for further information regarding expected volatility.

---

(1)	The aggregate intrinsic value of options and SARs is based on the difference between the fair market value of the underlying stock at December 31, 2015, using the market closing stock price, and exercise price for in-the-money awards.

(2)	Factors in expected future forfeitures.

---

---

---

---

---

---

---

(1)	The Italian budget law for 2016 was published in the Official Gazette on December 30, 2015. For Fiscal Year 2017 onward, the law provides a reduction of the applicable corporate income tax rate from 27.5% to 24% resulting in an adjustment to deferred taxes and a corresponding increase to tax expense of approximately $3.4 million.

(2)

Included in this adjustment is the reversal of the deferred tax asset established during the fiscal year ended April 24, 2015 and the quarter ended July 24, 2015, based on the assumption that these otherwise non-deductible transaction costs would be deductible if the business combination was not consummated. Because the transaction was ultimately consummated, the deferred tax asset was reversed as a non-deductible transaction cost in the amount of $2.3 million.

---

---

---

(1)	Excluded from the computation of diluted EPS for the transitional period April 25, 2015 to December 31, 2015 were outstanding options to purchase 220,536 ordinary shares because to include them would be anti-dilutive due to the net loss during the period.

(2)	Excluded from the computation of diluted EPS for the years ended April 24, 2015, April 25, 2014 and April 26, 2013 were outstanding options to purchase 56,547, 38,048 and 30,987 common shares, respectively, because to include them would have been anti-dilutive due to the option exercise price exceeding the average market price of our common stock during the period.

---

---

(1)	Net sales to external customers includes $14.3 million in the United Kingdom for the transitional year ended December 31, 2015. Prior to the Mergers, we were domiciled in the United States.

(2)	Includes those countries in Europe where LivaNova has a direct sales presence.  Countries where sales are made through distributors are included in Rest of World.

---

(1)	Property, plant, and equipment, net includes $2.4 million in the United Kingdom for the period ended December 31, 2015. Prior to the Mergers, we were domiciled in the United States.

(1)	During the transitional period April 25, 2015 to December 31, 2015, we consummated the merger with Sorin, and as a result, incurred $67.1 million in merger, integration and in restructuring expenses.

(2)	During fiscal year ended April 24, 2015, we entered into a definitive merger agreement with Sorin and incurred expenses associated with the proposed merger of $8.7 million.

---

---

---

---

---

---

---

---

---

---

---

---

(1)

MicroPort is a leading medical technology company that develops, manufactures and sells high-end medical devices. It was set up at Shanghai Zhangjiang Hi-Tech Park in May 1998. The company has approximately 1,800 employees. Its products include devices used for vascular diseases and disorders, e.g. cardiovascular, endovascular, and neurovascular disorders and diseases, as well as devices for electrophysiology, orthopedic care, diabetic care, endocrinal management, and surgical management. MicroPort serves patients and physicians in more than 1,200 hospitals throughout China and over 20 countries in Asia Pacific, South America and Europe. On average, every 30 seconds, one patient somewhere in the world uses MicroPort’s product to save life or to improve the quality of life through medical intervention.

(2)

MicroPort is the sole shareholder of MicroPort WeiBo Medical Devices (Shanghai) Co. Ltd. which is established and existing under Chinese law, with its legal address at Room 101, Unit 2, 501 Newton Road, Zhangjiang Hi-Tech Park, Shanghai 201203 and registered with the Pudong New Area Sub-bureau of Shanghai Administration for Industry and Commerce with the registration No. 310115002124521 (“Subsidiary”).

(3)

Sorin Group is a global medical device company and a leader in the treatment of cardiovascular diseases. With 3,750 employees worldwide, Sorin Group focuses on two major therapeutic areas: cardiac surgery (cardiopulmonary products for open heart surgery and heart valve repair or replacement products) and cardiac rhythm management (pacemakers, defibrillators and non-invasive monitoring to diagnose and deliver anti-arrhythmia therapies as well as cardiac resynchronization devices for heart failure treatment). Every year, over one million patients are treated with Sorin Group devices in more than 80 countries.

(4)	It is the Parties’ vision to work together in a stable long-term relationship, beneficial to both Parties, especially in order to assume together a significant role in the Chinese cardiac rhythm management (“CRM”) market.

(5)	MicroPort and its Affiliates have the advantage of access to excellent production conditions in the PRC, established tendering and bidding capabilities, and an established distribution and after-sales network in the Chinese cardiovascular market, while Sorin has the

---

---

(6)

With these strongly complementary strategic advantages, the Parties have reached an understanding to jointly invest into the Subsidiary as set out in details in a separate Capital Increase and Accession Agreement. Pursuant to the Capital Increase and Accession Agreement the Subsidiary shall increase its registered capital and after such capital increase MicroPort shall subscribe 51% equity interest in the Subsidiary’s registered capital and Sorin shall subscribe 49% equity interest in the Subsidiary’s registered capital. By means of this, the Subsidiary will be converted from a domestic company to a Chinese-foreign joint venture company (“Company”).

(7)

The Company shall be devoted to pacemakers, ICDs, CRTs, leads and programmers, components and other CRM related products (“CRM Products”). The Company shall exclusively facilitate the importation into and distribution in the Territory of Sorin’s existing and future CRM Products for the Territory. Upon further mutual agreement between the Parties during the term of the Company, the Company may potentially supply certain products to other emerging markets in the Asia Pacific region or other global markets. The Company shall assemble pacemakers, ICD and CRT implantable pulse generators (“CRM IPGs”) which would be deemed as domestic made CRM products, leveraging on Sorin’s technology and MicroPort’s manufacturing capacities in the PRC. The Company shall develop a new range of CRM IPGs with Sorin’s support on technology and know­ how subject to relevant license agreement with Sorin. These products shall address the value segment in Mainland China, Hong Kong, Taiwan and Macao (together “Greater China”) and other to be agreed Asia Pacific countries except Japan. Such products may also be sold in other global markets to be determined by the Parties upon mutual consents. It is the objective of the Parties that the Company will achieve 20–25% of market share of Chinese CRM business within 10 years of the start of the joint venture with both imported Sorin made products and products manufactured by the Company. The Company shall supply locally manufactured leads, programmers and other accessories to support imported Sorin products. The Parties agree that continuous efforts shall be made for the Company to reduce manufacturing costs, for example by identifying suitable local suppliers or manufacturing itself components for replacement of imported components. The Company shall also enhance international economic cooperation and technical exchanges and contribute to the development of the production of medical devices in the PRC, whilst increasing long term economic benefits for both Parties.

(8)

Now, after friendly consultations conducted in accordance with the principle of equality and mutual benefit, the Parties have agreed to jointly invest in an equity joint venture in Shanghai, the PRC, in accordance with the Law of the People’s Republic of China on Equity Joint Ventures, the Implementing Rules of the Law of the People’s Republic of China on Equity Joint Ventures, the Company Law of the People’s Republic of China, other relevant laws and regulations of the PRC, and the Capital Increase and Accession Agreement between the Parties. The Parties hereby enter into the following Contract and agree on the rights and obligations of the Parties as follows:

---

---

1.1	The Parties to this Contract are:

a.	Shanghai MicroPort Medical (Group) Co.• Ltd., a limited liability company under Chinese law, with its legal address at 501 Newton Rd., Zhangjiang Hi-Tech Park, Shanghai 201203, the PRC, and registered with the Shanghai Administration for Industry and Commerce with the registration No. 310115400053238;

Legal Representative:	Zhaohua Chang;

Nationality:	Chinese.

a.	Sorin CRM Holding SAS, a French company under French law, with its principal business address at 4, avenue Reaumur, 92143 Clamart cedex. France, and registered with the Greffe du Tribunal de Commerce de Nanterre, France under no. 751 624 198 R.C.S. NANTERRE;

2.1	“Acceptance Period” has the meaning as set out in Article 11.2 (c) of this Contract.

2.2	“Administration for Industry and Commerce” means the State Administration for Industry and Commerce and its subordinate branches of the PRC.

2.3	“Affected Party” has the meaning as set out in the relevant provision of Article 35 of this Contract.

---

2.4

“Affiliate” means, in relation to a Party, any corporation or other organization which is directly or indirectly controlled by, under common control with, or in control of, that Party, and for this purpose the term “control” means (i) ownership of fifty percent (50%) or more of the voting stock or registered capital of such corporation or other organization, (ii) ownership of such less equity interest deemed to be controlling under the laws of the jurisdiction where that corporation or other organization is organized, or (iii) being able to exercise significant influence on the resolutions of the shareholders’ meeting or the board of directors of such corporation or other organization on the basis of its voting rights derived from its capital contribution or stocks held or by other means including contractual relationships.

2.5	“Alternate” means a person appointed by a Director to exercise directors’ rights on his behalf in a Board of Directors meeting as set out in detail in Article 15.3 (f).

2.6	“Anti-Corruption Laws” means in relation to any person, collectively, the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, Chinese anti-bribery laws, and any other anti-corruption laws, any export control and anti-money laundering laws and laws relating to the proceeds of crime and funding for terrorism insofar as they apply to that person.

2.7

“Applicable Laws” means in relation to any person, any and all laws, common law, statutes, secondary legislation, directives, regulations, resolutions, statutory guidance and codes of practice, civil, criminal or administrative law, notices, judgments, decrees, orders or rulings from any Governmental Authority,in each case having the force of law insofar as they apply to that person, including but not limited to Anti-Corruption Laws

2.8	“Approval Date” means the date on which this Contract is approved by the Examination and Approval Authority.

2.9	“Articles of Association” means the articles of association of the Company as executed by the Parties simultaneously with this Contract (Annex 6).

2.10

“Assessment Period” shall be either (i) the last three (3) fiscal years immediately prior to the date when the Non-Affected Party notified the Affected Party of its intention to exercise its Call Option Ior II (as the case may be), or (ii) if the Company exists shorter than three (3) fiscal years after issuance of the Business License, during the period from issuance of the Business License to the date when the Non-Affected Party notified the Affected Party of its intention to exercise its Call Option Ior II (as the case may be).

2.11	“Board of Directors” or “BOD” means the board of directors of the Company.

2.12	“Business Day” means Monday through Friday, except for public state holidays of the PRC.

---

2.13	“Business License” means the legal establishment certificate of the Company to be issued by the Administration for Industry and Commerce when the Company is established in accordance with this Contract and the Articles of Association of the Company.

---

2.14	“Call Option I” has the meaning as set out in Article 35.9 of this Contract.

2.15	“Call Option II” has the meaning as set out in Article 35.10 of this Contract.

2.16	“Capital Increase and Accession Agreement” means the agreement entered into by and between MicroPort, Sorin and Subsidiary which governs the Subsidiary’s capital increase and Sorin’s participation in the investment in the Subsidiary.

2.17	“Chairman” means the chairman of the Board of Directors of the Company.

2.18	“Change of Control” means the event that the direct or indirect control of one Party where (a) at least 51% of its equity interests, or (b) all of the assets to which this Contract applies, is acquired by a Third Party which is, on the effective date of this Contract, a CRM competitor (commercializing CRM Products in the Territory) of the other Party.

2.19	“Company” means the equity joint venture company formed by the Parties pursuant to this Contract and the Articles of Association.

2.20

“Company Product” or “Product of the Company” means the CRM Products and related components and parts I) for which the Company has valid product certifications, registrations and licenses as may be required under relevant Chinese regulations to assemble, manufacture and introduce such CRM Products, components and parts to the market, ii) which are assembled and/or manufactured by the Company in compliance with the related Sorin Agreement or the technical results independently researched and developed by the Company, and iii) which have been introduced to the market by the Company.

2.21	“Competitor” means any enterprise or entity, which is neither the Company nor a Party nor any Affiliates of a Party nor any entity directly or indirectly owned by the Company, engaged in the manufacturing and distributing of CRM Products.

2.22	“Confidential Information” means any confidential or proprietary information concerning the business, financial condition, proprietary technology, research and development and other confidential matters, whether written, including email, or unwritten, and regardless of whether or not marked as confidential.

2.23	“Contract” means this joint venture contract executed by the Parties as of January 9th, 2014.

2.24	“Contribution” means the contribution to the registered capital of the Company by MicroPort and Sorin in accordance with the terms and conditions hereof.

2.25	“Contribution Date” means the date on which the Parties shall make or have made, whatever date is earlier, their relevant respective contributions to the Company’s registered capital as set forth under Article 9.

---

2.26	“Core Business” means the business operation in relation to the cardiac rhythm management.

---

2.27	“CPA” or “Certified Public Accountant” means an internationally recognized accounting service establishment licensed and registered in the PRC.

2.28	“CRM” means cardiac rhythm management.

2.29	“CRM Assets” means all CRM related assets of MicroPort and/or its Affiliates, which will be listed in Annex I, Ill, IV and V of the MicroPort CRM Business Transfer Agreement.

2.30	“CRM IPGs” means pacemaker devices, implantable cardioverter defibrillator (ICDs) and cardiac resynchronization therapy devices (CRTs), collectively called implantable pulse generators.

2.31	“CRM Products” means CRM IPGs, leads and programmers, components and other CRM related products.

2.32	“CRT” means cardiac resynchronization therapy device.

2.33	“Cut-off Date” means the last day of the calendar quarter preceding the day at which an event occurs that results in the necessity to determine the Net Asset Value of the Company.

2.34	“DES” drug eluting stents.

2.35	“Director” means any member of the Board of Directors.

2.36	“Encumbrance” means any lease, loan, mortgage, pledge, right of usufruct or any other form of security interest, including any other encumbrance on property as well as any other rights of any party other than the Company and the Parties of whatever nature.

2.37	“Entitled Party” has the meaning as set out in Article 11.2 of this Contract.

2.38	“EP” means electrophysiology.

2.39	“EUR” means Euro, the lawful currency of the European Monetary Union.

2.40	“Examination and Approval Authority” means the Ministry of Commerce of the People’s Republic of China or its subordinate branches or any other Governmental Authority or organs authorized to approve this Contract or any amendments, supplements hereto or any modifications or termination hereof.

2.41	“First Business Plan” means the business plan as agreed between the Parties for the Company concurrently with this Contract.

---

2.42

“Force Majeure” means any event, circumstance or condition that (i) directly or indirectly prevents the fulfilment of any material obligation under this Contract, (ii) is beyond the reasonable control of the relevant Party, and (iii) could not, by the exercise of reasonable prudent measures, have been avoided or overcome in whole or in part by such Party. Subject to the aforementioned items (i), (ii) and (iii), Force Majeure event includes but not limited to acts of God, war, terrorism, civil war, commotion, riot, blockade or embargo, strike, lock-out and other industrial action, fire, explosion, earthquake, epidemic, flood, windstorm.

2.43	“General Manager” means the head of the Company’s Management Office.

2.44	“Governmental Approval” means written document of consent or approval of, with, by or to any Governmental Authority.

2.45

“Governmental Authority” means, in any jurisdiction, any government. any other supranational, national, state, federal, regional, municipal, city, town or local government, any subdivision, court, arbitral tribunal, central bank or administrative agency or commission or other authority thereof, any quasi-governmental body exercising any regulatory, administrative, taxing, excise, customs importing or other governmental or quasi-governmental authority or any stock exchange or other regulatory or supervisory body or authority, a political party or a public international organization.

2.46	“Government Official” means any officeholder, employee or other official (including any immediate family member thereof) of a Governmental Authority, any person acting in an official capacity for a Governmental Authority or any candidate for political office.

2.47	“Greater China” means Mainland China, Hong Kong SAR, Taiwan and Macao SAR.

2.48	“ICD” means implantable cardioverter defibrillator.

2.49	“IFRS” means International Financial Reporting Standards as adopted by the International Accounting Standards Board in the version valid at the time that this Contract refers to in the relevant provision (most current version).

2.50	“Increased Registered Capital” has the meaning as set out in Article 7.2 of this Contract.

2.51	“Intended Transferee” has the meaning as set out in Article 11.2 (a) of this Contract.

2.52

“IPR” (intellectual property rights) means (a) patents, utility models, trademarks, service marks, rights in designs, trade or business names, copyrights (including rights in computer software), and all rights or forms of protection of a similar nature or having equivalent effect to any of the foregoing which may subsist anywhere else in the world, (b) applications for any of the foregoing, and (c) know-how and technical and proprietary information as well as designs.

---

2.53	“Joint Venture Term” means the term of the cooperation between the Parties as set forth in Article 35.1, including any extensions of such term pursuant to Articles 35.1 and 35.2 of this Contract.

---

2.54	“Labour Guidelines” means the labour guidelines of the Company, including any amendments thereto after initial adoption.

2.55	“Labour Laws” means any Jaws and regulations of the PRC as regards labour issues.

2.56	“Liability” or “Liabilities” means damages, claims, debts, payables, loans, losses, charges, actions, suits, proceedings, deficiencies, taxes, interest, penalties, fines, settlements, judgments and related costs and expenses, whether present or future, known or unknown, or fixed or contingent.

2.57	“Liquidation Panel” means the body as specified in Article 36 of this Contract.

2.58	“Management By-Laws” means the management by-laws of the Company as adopted in accordance with Article 15.2 (m) of this Contract, and includes any amendments thereto after initial adoption as may be approved by the Board of Directors.

2.59	“MicroPort” means Shanghai MicroPort Medical (Group) Co., Ltd. as identified in Article 1.1 (a) of this Contract.

2.60	“MicroPort Agreements” means all contracts with MicroPort or any of its Affiliates on the one side and the Company on the other side as parties.

2.61	“MicroPort CRM Business Transfer Agreement” means the CRM Business Transfer Agreement to be signed by MicroPort/one of its Affiliates and the Company prior to or concurrently with this Contract.

2.62	“MicroPort Directors” means the Directors of the BOD nominated by MicroPort.

2.63	“MicroPort Exclusive Master Distribution Agreement” means the MicroPort Exclusive Master Distribution Agreement to be signed by MicroPort and the Company prior to or concurrently with this Contract.

2.64	“Net Asset Value of the Company” means the book value of the Company's net assets as contained in the Company’s most recent audited balance sheet.

2.65	“Non-Affected Party” has the meaning as set out in the relevant provision of Article 35 of this Contract, either in the singular or in the plural.

2.66	“Offered Interest” has the meaning as set out in Article 11.2 (b) of this Contract.

2.67	“Party” means either of MicroPort or Sorin.

2.68	“Parties” means MicroPort and Sorin individually or collectively as the context may require.

2.69	“PRC” means the People’s Republic of China excluding Hong Kong SAR, Macao SAR and Taiwan for the purpose of this Contract.

---

2.70	“Pre-emptive Right” means an Entitled Party’s right to purchase all or part of the Transferor’s Offered Interest, as described in more detail in Article 11 of this Contract.

2.71	“RMB” means Renminbi, the lawful currency of the PRC.

---

2.73	“Sales Intermediaries” means distributors, dealers, service centres and other sales representatives, including marketing agencies and consultants.

2.74	“Secondees” means technical, professional or management personnel seconded to the Company by a Party or any of its Affiliates in accordance with the relevant written agreements.

2.75	“Secondment Agreement” means the Secondment Agreement to be concluded between the Company on one side and MicroPort or Sorin or their respective Affiliate on the other side.

2.76	“Sorin” means Sorin CRM Holding SAS as identified in Article 1.1 (b) of this Contract.

2.77	“Sorin Agreements” means all contracts with Sorin or any of its Affiliates on the one side and the Company on the other side as parties.

2.78	“Sorin Directors” means the Directors of the BOD nominated by Sorin.

2.79	“Sorin Exclusive Distribution Agreement” means the Exclusive Distribution Agreement to be signed by Sorin/one of its Affiliates and the Company prior to or concurrently with this Contract.

2.80	“Sorin Supply Agreement” means the Supply Agreement to be signed by Sorin CRM SAS on the one side and the Company on the other side as parties.

2.81	“Sorin Technology License Agreement” means the Technology License Agreement to be signed by by Sorin/one of its Affiliates and the Company, a template of which is attached hereto as Annex 20.1 (a).

2.82	“Sorin Trademark” means any trademark or service mark either registered or for which registration has been applied for in the name of Sorin or any of its Affiliates anywhere in the world.

2.83	“Statutory Funds” means those funds to which the Company, according to Chinese mandatory law, has to allocate any portion of the after-tax profit of the Company, e.g. reserve funds.

2.84	“Stream One Activity” means the assembly activities set out in Article 22.1 (a).

2.85	“Stream Two Activity” means the development and manufacturing activities set out in Article 22.1 (b ).

2.86	“Subsidiary” means MicroPort WeiBo Medical Devices (Shanghai) Co. Ltd.

---

2.87	“Supervisor” means each of the persons exercising the role of supervisor of the Company in accordance with the relevant provisions of the Company Law of the People’s Republic of China.

2.88	“Target Business Scope” has the meaning as set out in Article 5.2.

---

2.89

“Tax” means any national, provincial, municipal or local tax, duty, fee, assessment or other governmental charge or levy, whether in the PRC or elsewhere, of whatever kind and whether or not designated officially as a tax (including but not limited to any income tax, franchise tax, sales or use tax, value added tax, business tax, property tax, registration or stamp fee, excise tax, customs duty, and withholding for insurance or social benefits), and any interest and penalties thereon and additions thereto.

2.90	“Tax Consultant” means any internationally recognized tax consulting service establishment licensed and registered in the PRC.

2.91	“Tax Treaty” means any convention for the avoidance of double taxation in effect between the PRC and any other country.

2.92	“Territory” means Mainland China, Macao SAR and Taiwan in tenns of the Company’s marketing, distributing and selling the imported CRM Products and CRM IPGs of Sorin.

2.93	“Third Party” shall mean an individual or a legal entity other than the Company, MicroPort and Sorin and their respective Affiliates.

2.94	“Transfer Acceptance Notice” has the meaning as set out in Article 11.4 of this Contract.

2.95	“Transfer Offer” has the meaning as set out in Article 11.2 of this Contract.

2.96	“Transferor” has the meaning as set out in Article 11.2 of this Contract.

2.97	“US$” means United States Dollar, the lawful currency of the United States of America.

2.98	“Verification Report” means a written report on the results of the verification of any contribution made by a Party to the Company’s registered capital in compliance with relevant Chinese law.

2.99	“Vice Chairman” means the vice chairman of the Board of Directors.

---

3.1

The Parties hereby agree to form an equity joint venture company, with MicroPort holding 51 % of the equity interest of the Company, and Sorin holding 49% of the equity interest of the Company, in accordance with the Sino-Foreign Equity Joint Venture Law of the People's Republic of China, the Implementing Regulations of this law, other relevant laws and regulations, and with the provisions of this Contract and the amended and restated Articles of Association of the Company.

3.2	The name of the Company shall be changed from [“_______”] in Chinese, and “MicroPort Sorin CRM (Shanghai) Co. Ltd.” in English.

3.3	Sorin agrees to authorize or cause the Company to be authorized to use [“___”] in Chinese and “Sorin” in English in its name.

3.4	MicroPort agrees to authorize or cause the Company to be authorized to use [“___”] in Chinese and “MicroPort” in English in its name.

---

3.5	The legal address of the Company shall be Room 101, Building 2, 501 Newton Rd., Zhangjlang Hi-Tech Park, Shanghai 201203, PRC. The legal address of the Company can be changed according to the business needs of the Company.

4.1	The Company shall be a legal entity in the form of a limited liability company established under the laws of the PRC. The activities of the Company shall be governed and protected by the laws, decrees and relevant rules and regulations of the PRC.

4.2	Except as explicitly otherwise provided in this Contract, a Party shall only be liable to render its subscribed contribution to the Company’s registered capital.

4.3	The Company shall carry out its production and operation activities independent of the Parties to this Contract.

4.4	Unless expressly agreed by the Parties and by the Company in writing, no Party shall act as an agent of the Company, and no Party shall impose any obligation or Liability on the Company in the name of the Company or otherwise bind the Company towards Third Parties.

4.5	Unless expressly agreed by the concerned Party and the Company in writing, the Company shall in no case act as an agent of such Party, and the Company shall not impose any obligation or Liability on such Party or otherwise bind such Party towards Third Parties, and the Company shall not pledge the Party's credit and/or reputation at any time.

4.6

The Parties agree that the Company shall conduct its business on the basis of written agreements wherever reasonably practicable. Any transaction made by the Company shall be supported by appropriate documentation. Any supplies or services by a Party or any of its Affiliates to the Company shall be made or provided at arm’s length terms and conditions in accordance with applicable law and with written agreements then formally executed.

5.1

The purpose of the Company shall be to utilize the combined technological, management, operational and marketing strengths of the Parties within the approved scope of business of the Company to achieve good economic results and a return on investment satisfactory to the Parties. It is the Parties' vision to work together in a stable long-term relationship, beneficial to both Parties, especially in order to assume together a significant role in the Chinese CRM market.

5.2

The target business scope (“Target Business Scope”) of the Company shall be the development, designing, assembly, manufacture and wholesale, retail, import and export of pacemaker devices, implantable cardioverter defibrillator (ICDs) and cardiac resynchronization therapy devices (CRTs), collectively called implantable pulse generators, leads and programmers, components and other CRM related products, and conducting related research and development activities, and the provision of technical consultation, technical services, information services, medical educational services and activities and after-sale services related to the products of the Company. In case the exact approved and registered business scope of the Company at the date of the issuance of the Company’s Business License shall be different from the Target Business Scope due to regulatory reasons, the Parties agree to procure the Company to take all necessary actions and fulfill respective formalities in order to amend its business scope to reach the Target Business Scope as soon as practically possible.

---

6.1

The Parties agree to amend and restate the Articles of Association of the Company (Annex 6) in accordance with this Contract. The Contract and the amended and restated Articles of Association of the Company shall be signed by the duly authorized representatives of MicroPort and Sorin and shall be jointly submitted to the competent Examination and Approval Authority. In case of any inconsistency or conflict between the provisions of this Contract and the amended and restated Articles of Association of the Company, the provisions of this Contract shall prevail, and the Parties shall undertake to amend the amended and restated Articles of Association of the Company so as to conform to the provisions of this Contract.

6.2	The Company shall follow the Articles of Association and both Parties shall cause the Company to observe the Articles of Association at any time.

6.3	Any amendments to the Articles of Association of the Company shall be made by signing of amendments to and/or new Articles of Association between the Parties and to the extent required by Chinese law, obtaining the approval by the Examination and Approval Authority and conducting registration at the Administration for Industry and Commerce.

---

7.1	The total investment of the Company shall be RMB Three Hundred Sixty Six Million (RMB 366,000,000).

7.2	Subject to the Capital Increase and Accession Agreement, the registered capital of the Company shall be increased from RMB Four Hundred Fifty Thousand (RMB 450,000) to RMB One Hundred Twenty Two Million (RMB 122,000,000) (“Increased Registered Capital”).

7.3	The difference between the total investment and the Increased Registered Capital of the Company will be covered by the Company with external financing in accordance with Article 14 below.

7.4	The subscription and contributions to the Increased Registered Capital by the Parties shall be as follows:

(a)	MicroPort’s subscribed contribution to the Increased Registered Capital of the Company is RMB Sixty Two Million Two Hundred Twenty Thousand (RMB 62,220,000), representing fifty-one percent (51 %) of the Increased Registered Capital of the Company.

(b)	Sorin’s subscribed contribution to the Increased Registered Capital of the Company is RMB Fifty Nine Million Seven Hundred Eighty Thousand (RMB 59,780,000), representing forty-nine percent (49%) of the Increased Registered Capital of the Company.

8.1	The capital contribution subscribed by MicroPort as per Article 7.4 (a) above shall entirely be made in cash.

8.2	The capital contribution subscribed by Sorin as per Article 7.4 (b) above shall entirely be made in cash.

9.1	MicroPort has already paid in RMB Four Hundred Fifty Thousand (RMB 450,000) of its capital contribution to which it subscribes as per Article 7.4 (a).

9.2

MicroPort shall pay twenty percent (20%) of its newly subscribed capital contribution during the capital increase In the amount of RMB Twelve Million Three Hundred Fifty Four Thousand (RMB 12,354,000) to the Company within fifteen (15) calendar days after the Approval Date, another thirty percent (30%) of its newly subscribed capital contribution in the amount of RMB Eighteen Million Five Hundred Thirty One Thousand (RMB 18,531,000) to the Company within six (6) months after the Approval Date and the remaining fifty percent (50%) of its newly subscribed capital contribution in the amount of RMB Thirty Million Eight Hundred Eighty Five Thousand (RMB 30,885,000) to the Company within eighteen (18) months after the Approval Date.

9.3

Sorin shall pay twenty percent (20%) of its capital contribution to which it subscribes as per Article 7.4 (b) above in the amount of RMB Eleven Million Nine Hundred· Fifty Six Thousand (RMB 11,956,000) to the Company within fifteen ( 15) calendar days after the Approval Date, another thirty percent (30%) of its newly subscribed capital contribution in the amount of RMB Seventeen Million Nine Hundred Thirty Four Thousand (RMB 17,934,000) to the Company within six (6) months after the Approval Date and the remaining fifty percent (50%) of its newly subscribed capital contribution in the amount of RMB Twenty Nine Million Eight Hundred Ninety Thousand (RMB 29,890,000) to the Company within eighteen (18) months after the Approval Date.

9.4	Under no circumstances will any discrepancy between the amount or value of any contribution of any Party and the amount subscribed to by such Party to the Company’s Increased Registered Capital lead to a change in the ratio of shareholdings in the Company or in the voting rights.

9.5

Both Parties may make and pay its cash capital contributions in EUR or US$ or RMB or a combination thereof, to the extent permitted under law. Any exchange between a foreign currency and RMB required for the purposes of calculating the RMB value of any contribution made by a Party shall be made in accordance with the middle exchange rate for purchasing RMB for the foreign currency as quoted by the People’s Bank of China at its headquarters in Beijing on the date the related contribution is actually deposited to the bank account of the Company.

10.1	Each time the Parties have paid in contributions to be made at any given Contribution Date, a verification of the relevant contributions of each Party shall be conducted as follows:

---

(a)	The CPA shall verify the relevant contributions and shall issue a Verification Report within ten (10) Business Days after the last contribution to be made at the relevant Contribution Date has been made.

(b)	The Chairman of the Board of Directors of the Company shall forward photocopies of the Verification Report to each Party immediately after the Company has received it.

---

(c)	Any expenses for retaining the CPA for verification purposes shall be borne by the Company.

11.1	Without prior written consent from the other Party, neither Party may sell or otherwise transfer all or part of its equity interest in the Company.

11.2	A Party that wishes to sell or otherwise transfer all or part of its equity interest in the Company (“Transferor”) shall give the other Party (“Entitled Party”) written notice (“Transfer Offer”) setting forth:

(a)	name/firm name, registration place and address of the intended transferee (“Intended Transferee”);

(b)	transfer price and key terms and conditions of the intended transfer of the Transferor's equity interest in the Company (“Offered Interest”);

(c)

validity term of the Transfer Offer but in any event such validity term shall be no less than sixty (60) days after receipt of the Transfer Offer by the other Party; in case equity interest is sold through an asset exchange centre as required by the applicable PRC laws and regulations, the acceptance period shall be prolonged to four (4) weeks after final determination of the purchase price (“Acceptance Period”);

(d)	the Intended Transferee’s consent in writing to be bound by this Contract and the Articles of Association of the Company without any reservation; and

11.3

The Transferor undertakes that without the prior written consent of the Entitled Party, no Confidential Information of the Company or the Entitled Party shall be disclosed to the Intended Transferee, which consent shall not be unreasonably withheld but may be made subject to the availability of a non-disclosure agreement validly entered into by the Intended Transferee and in favour of the Company and the Parties.

11.4

If an Entitled Party selects to exercise its right of purchase and accept all or part of the equity interest to be sold under the Transfer Offer (“Pre-emptive Right”), such Entitled Party shall provide a written notice to the Transferor (“Transfer Acceptance Notice”) within the Acceptance Period to exercise such right. Such Transfer Acceptance Notice shall set forth the amount of the equity interest the Entitled Party agrees to purchase.

11.5

If, due to any regulatory restrictions under Chinese law or governmental policies, an Entitled Party exercising its Pre-emptive Right of purchase is prevented from acquiring all or part of the Offered Interest it accepted in its Transfer Acceptance Notice, such Entitled Party may nominate in the Transfer Acceptance Notice a Third Party to acquire all or part of the Offered Interest at the price and the other terms and conditions set forth in the Transfer Offer, however in no way shall such Third Party be a Competitor.

11.6

To the extent that, within the Acceptance Period, the Entitled Party does not exercise its Pre-emptive Right or nominate a Third Party in case of Article 11.5 above or the Offered Interest that the Transferor requests to sell is not fully subscribed by the Entitled Party or the Third Party nominated by the Entitled Party and provided that the Intended Transferee is not a Competitor, the Entitled Party shall provide within the Acceptance Period its written consent to the Transferor to sell such part of the Offered Interest to the Intended Transferee subject to the further terms and conditions hereunder, i.e. in particular for a price no less than the price set forth in the Transfer Offer and upon other terms and conditions no more favourable to the Intended Transferee than those set forth in the Transfer Offer.

11.7	Any Party hereto shall be entitled to sell or otherwise transfer all or part of its equity interest in the Company to its Affiliates. In such scenario, the other Party within thirty (30) days after receiving the notice of intention to transfer from the transferring Party shall provide its written consent for such sale or transfer and the provisions in Article 11.2 through 11.6 shall not apply.

11.8

When any Party exercises its right to sell or otherwise transfer all or part of its equity interest in the Company pursuant to this Article 11, the other Party hereto agrees to provide all necessary assistance, including signing all documents, providing relevant documents and information, causing its Director to vote for such equity interest transfer etc., so as to implement the transaction and related restructuring of the Company contemplated hereunder and to obtain all necessary Governmental Approval to consummate the transaction. MicroPort's related obligations hereunder in particular include to use its best efforts to obtain all approvals and the like authorizations which may be required to implement the concerned transaction without the performance of a statutory bidding or auctioning procedure and to arrive at a price for the concerned equity interest transfer equalling the one as determined in compliance with the relevant regulations under this Article 11. MicroPort shall ensure that in case of a statutory bidding or auctioning process none of its Affiliates will bid for MicroPort’s equity interest in the Company that may be offered for transfer.

12.1	No Party shall pledge or create any Encumbrance on its equity interest in the Company, unless with the prior written consent of the other Party.

13.1

Any increase in or reduction of the registered capital of the Company requires the prior written consent of the Parties, the unanimous resolution of the Board of Directors and, to the extent required by mandatory law approval of the Examination and Approval Authority. Unless otherwise agreed by the Parties in writing, any adjustment of the registered capital of the Company shall keep the ratio of the equity interest of the Parties in the Company unchanged.

13.2	If the Company’s registered capital is increased or reduced, the Parties shall promptly modify this Contract and the Company’s Articles of Association accordingly. The Company shall also handle the procedures for change of the registration with the relevant Administration for Industry and Commerce without undue delay.

---

14.1	No Party shall be obliged to provide the Company with any loan, advance, guarantee or other security.

---

14.2

Necessary funds for the business needs of the Company which are not covered by the Company’s equity shall be raised by loans or similar instruments by the Company subject to unanimous resolutions of the BOD. The Parties shall assist the Company in its efforts to procure external financing. MicroPort shall assist the Company in applying for loans from lenders in the PRC on competitive terms and conditions, and Sorin shall assist the Company in applying for loans from lenders outside the PRC on competitive terms and conditions.

14.3	Subject to the agreement between the Parties, the Parties may provide security as may be required by the Company to obtain external financing in proportion to their shares in the registered capital of the Company.

14.4	To cover the difference between the registered capital and the total investment or other financing needs of the Company, each Party or its designated Affiliates may, with the consent of the other Party and the Company, extend shareholder loans to the Company at arm’s length terms and conditions.

15.1	Formation

a.

The date of the issuance of the Company's Business License shall be the date of establishment of the Board of Directors. The BOD shall be the highest authority of the Company and shall decide the development strategy and other long-term planning issues of the Company in compliance with the provisions of this Contract, the Articles of Association and any agreement between the Parties. No member of the BOD in its function as the BOD member shall interfere with the daily management of the Company. It is understood, however, that a Director may concurrently serve as a member of the Management Office of the Company and may in his function as a member of the Management Office carry out his duties as a manager.

b.

The BOD shall consist of four (4) directors (including the Chairman and the Vice Chairman), two (2) of whom shall be appointed by MicroPort (“MicroPort Directors”), and two (2) of whom shall be appointed by Sorin (“Sorin Directors”), provided however that none of the Directors appointed by a Party shall be shareholders, controlling parties, managers or consultants to a business which competes with the Core Business of the other Party. For the purpose of this Article 15.1 (b), the Parties and their Affiliates shall be deemed as not competing with the Core Business of the other Party. If any subsequent change in the ratio between MicroPort’s and Sorin’s equity interest in the Company requires that the number of the Directors and appointment rights for Directors be adjusted to properly reflect each Party's equity interest in the Company, the Parties shall promptly amend this Contract and the Articles of Association accordingly.

c.

Each Director, including the Chairman and the Vice Chairman, shall be appointed for a term of three (3) years, provided that the Party which has appointed a Director may remove that Director and appoint a replacement at its discretion and at any time. If a seat on the BOD is vacated by the retirement, resignation, removal, disability or death of a Director, the Party which originally appointed such Director shall immediately appoint a successor. Any Director may serve consecutive terms subject to a related appointment by the concerned Party.

d.	The Chairman of the BOD in the first term shall be appointed by MicroPort from one of the MicroPort Directors, and the Vice Chairman of the Board of Directors in the first term shall be appointed by Sorin from one of the Sorin Directors. The right to appoint the Chairman and the Vice Chairman of the BOD shall rotate every three (3) years between MicroPort and Sorin.

e.

The Chairman of the BOD shall be the legal representative of the Company. Without prejudice to convening BOD meetings as set forth hereunder, the Chairman and the Vice Chairman shall respectively carry out all functions and tasks as authorized specifically by the BOD in advance. Whenever the Chairman of the BOD is unable to perform or prevented from performing his functions for any reason, unless otherwise provided under this Contract, the Chairman or the Party that appointing the Chairman shall immediately designate one Director to exercise the functions of the Chairman temporarily. If no such Director is designated or such designated Director fails to perform the respective function within three (3) calendar days after the respective action shall have been taken by the Chairman, the Vice Chairman shall temporarily exercise the Chairman's function on behalf of the Chairman.

f.

MicroPort or Sorin, as the case may be, shall notify to the other Party and the Company in writing its appointment or removal of a Director or the designation or change of the Chairman or the Vice Chairman. The appointments and removals of Directors, and designations and changes of the Chairman or Vice Chairman shall become effective upon receipt of such notice by the other Party and the Company, unless they are not in compliance with this Contract. Such appointments, removals, designations and changes shall be filed with the Administration for Industry and Commerce to the extent required by law.

g.

The Company shall, in accordance with relevant Chinese laws, indemnify the relevant Director against all claims and liabilities incurred by reason of his being a Director of the Company and in the course of performing his official duties as a Director of the Company, provided that the claim or liability does not result from intentional misconduct or gross negligence or graft or serious dereliction of duty or a violation of criminal laws by the Director.

h.

Unless concurrently serving as a member of the Management Office or otherwise agreed by the Parties, Directors shall serve without any remuneration from the Company, but the reasonable costs incurred by the Directors in the performance of their duties as Directors (including travel and accommodation expenses) shall in any case be reimbursed by the Company if so requested by the Director who incurred such costs to the extent such costs complies with the expenses and reimbursement policies of the Company.

i.

j.	In addition to the other obligations under this Contract, each Party shall be responsible for the conducts of the Directors (in fulfilling their functions as Directors) appointed by It and shall cause its Directors to act In accordance with this Contract and the Articles of Association.

15.2	Powers

a.	Any amendment to this Contract and/or the Articles of Association;

b.	Any merger, division, suspension, termination, dissolution, liquidation, winding up, or debt restructuring of the Company, or change of corporate form of the Company, or change of principal business domicile of the Company, or filing for bankruptcy;

c.

Any alteration of the Company's registered capital or total investment including: (i) any transfer, increase, reduction, consolidation, subdivision or conversion; (ii) any creation, allotment, issue, acquisition, redemption, repurchase or repayment of securities, including equity, convertible bonds, options, warrants and other securities; and (iii) issue of any debentures or securities convertible into equity or debentures;

d.	Decisions on the Company's overall business policy and objectives, including annual, medium and long-term strategy, plans and budgets, capital investments and strategic partnerships; products (and components) development policy (Include licensing-in, out, IPR); financing plans; liquidation plan; determination of products and brands assembled or manufactured by the Company;

e.	Within the first quarter of each fiscal year, approval of annual financial statements of the Company of the previous year (balance sheet, profit and loss statement, cash flow statement);

f.	Approval of the distribution plan of annual profits and decision on dividend payment;

g.	Establishment and/or dissolution/liquidation of any subsidiaries;

h.

Investment by the Company in any other business including but not limited to transfer, assignment, sale, encumbrance or other disposal of any such investment; exercise of all the Company's rights resulting from its investment in any other business, except for CRM related business, whether under law or contract; delegation and appointment of members to the organs of such business, unless delegated to the Management Office;

i.	Acquisition, lease or sale of fixed assets or real property of the Company with a value exceeding the amount of RMB 2,000,000, unless contained in a plan previously approved by the BOD;

j.

k.	Mortgage, pledge or other disposal of any material part of any undertaking, property or fixed assets, contract or other business of the Company or issuing of guarantees by or for the Company, unless contained in a plan previously unanimously approved by the BOD;

l.	The appointment and terms of employment (including entire remuneration) of the General Manager and Deputy General Managers and their dismissal in cases of violation of applicable laws or Internal rules and regulations or serious dereliction of duties;

m.	Appointment and dismissal of the CPA which is responsible for the audit of the Company and verifying the Parties' contributions as provided in this Contract;

n.	Adoption of a code of conduct for the Company and its personnel, consistent with all applicable laws and any important rules and regulations of the Company, and the guidelines for compliance, including the Management By-Laws proposed by the General Manager:

o.	Any amendment to, extension or early termination of the MicroPort Agreements and Sorin Agreements (including all license agreements);

p.	Acquisition of any IPR or disposal of any IPR of the Company;

q.	Granting of any loans, or advancing or giving any financial credit, guarantee or other security for the liabilities or obligations of any person, not contained in any planning unanimously approved by the BOD;

r.	Review and approval of the reports submitted by the General Manager;

s.	Entering into, amending and/or terminating any agreement or arrangement with a Party or the Parties;

t.	Other functions and powers as set forth under this Contract and the Articles of Association.

15.3	Meetings

a.	The first meeting of the BOD shall be held within one (1) month at the premise of the Company after the date of issuance of the Company's Business License. At such first BOD meeting the BOD shall:

a.	ratify all agreements attached hereto in the Annexes on behalf of the Company and, as far as required by laws and regulations, instruct their due registration in accordance with the provisions and instructions as set forth therein;

a.	appoint the General Manager and the Deputy General Managers and other personnel to be appointed by the BOD;

b.	adopt the First Business Plan;

c.	appoint a CPA which shall verify the Parties' contributions as provided in this Contract;

d.	approve the CPA which is responsible for the Company's annual audit;

e.	without prejudice to Article 15.3 {b) below, agree on the dates for the next four (4) BOD meetings to be convened in the next twelve (12) months; and

f.	authorize the General Manager to sign relevant operational and commercial contracts on behalf of the Company to the extent within the competency of the General Manager under this Contract, the Articles of Association and the Management By-Laws.

b.

After the first Board of Directors meeting as per Article 15.3 {a) above, the Board of Directors shall hold regular BOD meetings (“Regular Board Meeting”) every three (3) months. In any case the notice of each Regular Board Meeting shall be given to each Director at least twenty-one (21) calendar days in advance, unless the requirement for such notice is waived by the Directors in writing. Special meetings of the Board of Directors (“Special Board Meeting”) may be convened upon a written request of at least two Directors and a notice shall be given at least fourteen (14) calendar days in advance. Any such notice shall include the time, place and agenda of the BOD meeting as well as drafts of documents to be reviewed and approved by the BOD at the BOD meeting. Any Director may prepare and submit a proposal for the matters to be decided by the BOD when he deems necessary.

c.	The Chairman of the Board of Directors shall be responsible for convening and presiding over the BOD meetings. BOD meetings may also be held by video or telephone conference upon the request of any Director, as long as all Directors agree and the member of the Board of Directors presiding over such meeting is able to confirm the identity of each participating Director.

d.

The quorum for a BOD meeting shall be three-quarters (3/4) of all the Directors (or their respective Alternate). If the Board of Directors fails to proceed to business at a duly convened BOD meeting because of an insufficient quorum, then the Chairman or, in case of his failure to do so, the Vice Chairman shall immediately repeat the convention of the said BOD meeting with a fourteen ( 14) calendar days' notice rendering the same agenda and providing for the same meeting place. If at such second (repeated) meeting a quorum is not present at the time fixed for such meeting, such second (repeated) BOD meeting shall be entitled to adopt decisions on matters set out in such (repeated) agenda regardless of the number of Directors present or represented by Alternates, provided such effect has been explicitly stated in the Chairman's or, as the case may be, the Vice Chairman's notice convening such second (repeated) meeting.

e.

Except as otherwise provided for in this Contract, each Director attending the BOD meeting shall have one (1) vote for any matters requiring a BOD resolution. The Chairman has the tie-breaking vote for all BOD voting issues, except for certain major areas/issues which require unanimous approval to be specified in Article 15.2 (a) through to and including (p) of this Contract. In the event of a tie vote, there will be a fifteen (15) calendar day cooling off period in which no official BOD decision can be made, the Chairman's tie breaking vote shall not be effective during this period. During this period, all Directors shall discuss in good faith the matter in question until a simple majority of Directors can be reached. If after this fifteen (15) calendar day cooling off period no majority decision can be made, then there shall be an additional thirty (30) calendar day period where the respective corporate CEO's or their nominees of MicroPort and Sorin shall try to negotiate and mutually agree on the tie-breaking vote. If after this thirty (30) calendar day CEO negotiating period no majority decision can be made, then the Chairman's tie breaking vote shall be effective.

f.

Any Director may, by an instrument in writing (including in facsimile or electronic format, provided the signature is clearly shown) addressed to the Chairman and the Vice Chairman, at any time appoint any person (including another Director) to be his alternate (“Alternate”), who may concurrently be an Alternate of another Director and shall have all the rights, privileges and powers of the Director(s) for whom he is or shall be the Alternate in respect of any BOD meeting which such Director(s) is (are) unable to attend, and any Director who appoints an Alternate may at any time terminate such appointment. Each Alternate shall have one vote and, for the purpose of determining whether a quorum exists, shall be counted separately for every Director whom he represents. If such Alternate is also himself a Director then he shall have his vote and, for the purpose of determining whether a quorum exists, be counted separately in addition to the number of votes he has as an Alternate for any other Director(s). Any Director may invite translators, legal and other advisors, or other relevant persons to attend and assist in any BOD meeting, provided that the inviting Director shall notify the Chairman the name, identity, and title of his invitees 7 days prior to the BOD meeting and procure that each of the invitees shall be bound to respective confidentiality obligations. Such invitees shall not have any voting rights. The costs of the invitees shall be borne by the inviting Director, unless the Chairman and the Vice Chairman agree that such costs will be borne by the Company. The Director who invites such persons shall ensure that such persons shall keep confidential all the information of the Company they learn at the meeting.

g.

h.

The working language of the Board of Directors shall be English and Chinese and the Company shall ensure appropriate translation as may be required for any BOD meetings or Board of Directors’ dealings. The Board of Directors shall cause complete and accurate minutes of all BOD meetings in both Chinese and English language, and such minutes shall be signed by those Directors attending the meetings. Any resolutions made by the Board of Directors in a BOD meeting shall be prepared in Chinese and English for signature by all Directors voting in favour of the resolution. Draft minutes of BOD meetings shall be distributed to all the Directors within fifteen (15) Business Days from the date of such BOD meeting. Any Director who wishes to propose an amendment or addition shall submit the same in writing or through email to the Chairman and the Vice Chairman within ten (10) Business Days after receipt of the draft minutes. Once a Director (either directly or through his Alternate) has signed his approval of the text of a resolution, that Director may not propose any subsequent amendments or additions to such resolution. The Chairman and the Vice Chairman shall jointly complete the final minutes and distribute them to each Director and each Party not later than thirty (30) calendar days after the respective BOD meeting. If the Chairman and the Vice Chairman cannot agree on any part of the text of the minutes, they shall complete and distribute the rest of the final minutes as provided above, and the text at issue shall be placed on the agenda for the next BOD meeting. The Company shall maintain a file of all Board of Directors meeting minutes and make the same freely available to the Directors, the Parties and their authorized representatives.

i.

The Board of Directors may validly adopt decisions by written consent (including by facsimile) without holding a meeting, provided all Directors are given written notice (including by facsimile) of the resolutions proposed for adoption without a meeting in the same manner as provided in Article 15.3 (b), and in such event Article 15.2 shall apply in determining whether a majority or unanimous decisions of all the Directors shall be required for adoption of a resolution. Facsimile signatures of Directors shall be binding for this purpose. Written resolutions adopted in this manner shall be filed with the minutes of the Board of Directors proceedings which shall be presented to the Directors in the next duly convened meeting of the Board of Directors and shall have the same force and effect as a resolution adopted at a duly convened meeting of the Board of Directors.

16.1	Composition of the Management Office

a.	The Company shall have a Management Office under the leadership of the General Manager and the surveillance of the Board of Directors. The Management Office shall consist of the General Manager (CEO) and the Deputy General Manager for Finance (CFO). The term of office for each member of the Management Office shall be three (3) years and may be renewed.

b.	The General Manager (CEO) and the Deputy General Manager for Finance (CFO) shall be appointed by the BOD. Either Party shall have the right to nominate to the BOD the candidates for the General Manager (CEO) and the Deputy General Manager for Finance (CFO).

c.	If the positions of the General Manager or the Deputy General Managers are vacated by the retirement, removal, resignation, illness, disability, death or any other reason, the BOD shall appoint a successor in accordance with the nomination as set out in this Article 16.

d.	In material cases as may be further described in the Management-By-Laws the General Manager may apply to the BOD to replace any other member of the Management Office which the BOD shall seriously consider.

e.	As for the management personnel to be seconded to the Company by MicroPort and/or Sorin, MicroPort and/or Sorin and the Company shall respectively conclude a Secondment Agreement.

16.2	Duties and Authorities of the General Manager

a.	Organize and implement the resolutions, strategic business directions and plans approved by the BOD;

b.	Manage the day-to-day business and all relevant administrative matters:

c.	Prepare and implement the business plans, budgets, production plans, personnel and staffing plans, procurement and sales plans and other plans and programs and any revisions thereto, unless there is a material deviation from the relevant plans or budget approved and adopted by the BOD;

d.

Prepare and submit to the BOD for review and approval (i) the management and financial statements, (ii) the annual financial plan, the annual financial reports, income and expenditure accounts, profit and loss accounts, all in accordance with the requirements for such financial statements and accounts set out in Article 27 below as well as in line with the reporting requirements as notified by MicroPort and Sorin from time to time;

e.	Maintain control over all financial matters and guide the other members of the Management Office;

f.	Set up the management structure as contained in the Management-By-Laws approved by the BOD, hire and dismiss personnel not being members of the Management Office;

g.	Prepare any internal regulations of the Company, including any amendments thereto, and supervise their implementation, subject to their prior approval by the BOD if such approval Is required under this Contract, the Articles of Association of the Company or the Management-By-Laws;

h.	Decide on incentive systems with regard to especially but not limited to the procurement and distribution activities of the Company;

i.	Promptly notify the Parties and the BOD about all matters coming to his notice which may materially affect the Company's business, premises, or property;

j.	Provide the Parties with other information and access as may be requested by the Parties; and

k.	Handle other matters entrusted or requested by the BOD.

16.3	Duties and Authorities of the Deputy General Managers

a.	To be responsible for specific functional departments of the Company to which they are assigned, e.g. product development, production, financial management, sales or other daily operation etc., all under the leadership of the General Manager and further detailed in the Management By-Laws;

b.	If requested by the BOD or the General Manager, to attend the BOD meeting as non-voting delegates;

c.	To assist the General Manager in organizing and implementing resolutions of the BOD and with the daily operation of the Company as instructed by the General Manager; and

d.	Other duties under his competences as provided in the Management By-Laws.

16.4

The General Manager has the final responsibility and authority for the daily operations of the Company and holds the final decision on operational and management issues within the scope and competency vested to him under this Contract, the Articles of Association, any plans approved by the BOD and the Management By-Laws. The Deputy General Managers shall support the General Manager to fulfill his management functions.

16.6	Other Regulations

a.

All members of the Management Office shall perform their duties on a full-time basis and shall not concurrently serve as a manager or other employee of any other company or enterprise, unless otherwise agreed by the Parties or approved by the BOD in writing in advance. No members of the Management Office may serve as a director of or consultant to, or hold any material interest in, any company or enterprise that competes with the Company, unless otherwise agreed by the Parties or approved by the BOD in writing in advance.

b.

The Company shall. in accordance with relevant Chinese laws, indemnify each member of the Management Office against all claims and liabilities incurred by reason of his being a member of the Management Office of the Company and in the course of performing his official duties as a member of the Management Office of the Company, provided that the claim or liability does not result from intentional misconduct or gross negligence or a violation of mandatory laws or the rules and regulations of the Company by the member of the Management Office.

c.	The working language of the Management Office shall be Chinese and English. All members of the Management Office shall have a determinant level of English.

17.1	Formation

a.	The Company shall have two (2) Supervisors of whom one (1) Supervisor shall be appointed by MicroPort and one (1) Supervisor shall be appointed by Sorin. The term of office of each Supervisor shall be three (3) years and may be renewed. Each Party may remove the Supervisor nominated and appointed by it and appoint a replacement at any time.

b.	The Directors, any member of the Management Office, or other senior staff of the Company shall not be allowed to concurrently serve as a Supervisor.

17.2	The Supervisors shall exercise the following functions and powers:

a.	Examining the Company's financial affairs;

b.	Supervising the Directors, members of the Management Office and other senior staff of the Company in the performance of their duties and proposing related replacements or dismissals;

c.	If an act of Director, member of the Management Office or other senior staff of the Company is detrimental to the interests of the Company, requiring him to rectify such act;

d.	Submitting motions to the BOD and the Parties;

e.

f.

Instituting, upon written request by any of the Parties, legal proceedings against the Directors or members of the Management Office or other senior staff of the Company if such Directors or members of the Management Office or other senior staff of the Company violate laws, administrative regulations, this Contract or the Articles of Association of the Company in the course of performing their duties, thereby causing the Company losses;

g.	Carrying out other functions as set forth by laws and regulations, this Contract and the Articles of Association of the Company.

17.3	Each Supervisor has the right to participate in BOD meetings as non-voting attendee. Reasonable and evidenced expenses incurred by the Supervisor in connection with his function as Supervisor of the Company shall be reimbursed by the Company to the extent that such costs complies with the expenses and reimbursement policies of the Company.

17.4	The Company shall indemnify each Supervisor for all claims and liabilities incurred in the course of performing his duties as Supervisor of the Company, provided that such claims or liabilities are not caused by intentional misconduct, gross negligence or graft or serious dereliction of duties or breach of criminal laws by such Supervisor.

---

18.1	The Parties agree that the Company's business activities after the establishment of the Company shall be carried out according to the First Business Plan and the principle as specified in Article 18.2 to Article 18.5 below.

18.2	Both Parties agree and ensure that:

a.	The Company shall exclusively facilitate the importation and distribution of Sorin's existing and future CRM Products. The imported Sorin's CRM Products shall be marketed, promoted, distributed and sold by the Company only in Macao SAR, Taiwan and Mainland China (“Territory”);

b.	The Company shall assemble CRM IPGs which shall be deemed as domestic made CRM products, leveraging on Sorin's technology and MicroPort's manufacturing capacities in the PRC; and

c.	The Company shall retain the existing CRM R&D team of MicroPort in accordance with the MicroPort CRM Business Transfer Agreement.

---

18.3	The business activities of the Company shall be extended to the following activities:

a.	The Company shall supply imported Sorin's CRM Products to other emerging markets in the Asia Pacific region or other parts of the global markets upon the unanimous resolution of the BOD;

b.	The Company shall develop a new range of CRM IPGs through its internal R&D activities and with Sorin's support on technology and know-how subject to the Sorin Technology License Agreement;

c.	the CRM IPGs locally assembled and locally developed by the Company may be sold by the Company in Greater China and other Asia Pacific countries or regions (except Japan) to be agreed by the Parties in writing. Such products may also be sold in other global markets to be determined by the Parties upon the unanimous resolution of the BOD; and

d.	Other CRM Products (leads, programmers, accessories, etc.) manufactured by the Company shall be sold in global markets, subject to local regulatory approvals.

18.4	Both Parties shall ensure that the Company shall undertake all necessary actions to obtain necessary production licenses and product approvals for locally manufactured CRM Products, leveraging the resources and with the support of the Parties. MicroPort undertakes to provide the Company with all necessary regulatory support.

18.5	Both Parties shall ensure that the Company shall establish a quality management system and a post-marketing surveillance system in compliance with applicable regulatory requirements and, where applicable and practical, with reference to the relevant Sorin standards.

19.1	As soon as reasonably possible after the issuance of the Business License and subject to the BOD’s unanimous resolution, the Company shall lease or purchase a proper production site and the related facilities by way of public tender or otherwise in Shanghai City to carry out its production and business operation.

19.2	MicroPort shall exert its utmost reasonable efforts to facilitate the Company and the landlord identified by the Company in the course of lease, land acquisition, development and project construction so as to reduce the land and construction costs and further to reduce the rent and other costs for the Company.

20.1

Unless this Contract and relevant license agreements provide otherwise, both Parties shall license all necessary CRM related IPR without charge to the Company for the purpose of commercialization of the imported products under Sorin Trademark and manufacturing CRM Products under the Company's own trademark(s), as per the Company's overall business policy and objectives decided by the Board of Directors (Article 15.2 (d)). Matters regarding such IPR license by Sorin are to be set out in the Sorin Technology License Agreement to be signed by the licensing party and the Company and attached hereto as Annexes 20.1 (a). If required by Chinese law, the Parties and the Company shall procure to carry out relevant registration of the licenses granted pursuant to this Contract.

20.2

All IPR, including but not limited to patent rights, trademarks, designs, copyright, knowhow, names and logos originally developed and owned by each Party remain the property of that Party. The Company shall not and the Parties shall ensure that the Company must not use outside of the PRC any IPR of the Parties and/or their Affiliates, or grant any sub-license without the licensing party's or its respective Affiliates' prior written approval or reverse engineer or re-engineer any product hardware or software owned by either Party and/or their Affiliates without its/their explicit prior written consent. Both Parties acknowledge all IPR of each other and agree that they must not at any time claim any interest in each other Party's IPR. The Parties further agree that any IPR licensed to the Company by any of the Parties hereto or by any of their Affiliates is provided for the use by the Company under this Contract only. Unless otherwise provided in a written agreement entered into by and between the licensing party and the Company or the other Party (or any of their Affiliates), during the term of this Contract and after its expiration or termination, the Company or the other Party (and its Affiliates) must not use by any means such IPR for any purpose, and shall abide by the confidentiality obligations set forth under this Contract.

20.3	The IPR developed by the Company itself shall be solely owned by the Company. Upon both Parties' agreement and by unanimous BOD resolutions, the Company shall identify and register a new brand as the trademark for the devices locally manufactured by the Company.

21.1

The Parties agree and ensure that the Company shall comply with mandatory laws on localization in the course of purchasing production materials and services. During the purchase of production materials and services, comprehensive considerations on quality and price shall be taken by the Company. Subject to fulfillment of all quality and regulatory requirements, decisions of purchase shall be made according to the following principles: (i) If the prices of local production materials and services are lower than prices of those imported, then the local production materials and services shall be purchased; (ii) If the prices of local production materials and services are higher than the prices of those imported, then such production materials and services shall be imported. The concept of the price for purpose of this Article includes but is not limited to direct purchase cost, replacement cost, verification cost relating to the products, import and export formalities, transportation, services and delivery time, etc. The Company shall identify opportunities to save production costs by identifying potential local suppliers for components, or even locally manufacture itself those components, such as header, can, battery, etc.

21.2

Both Parties agree that subject to the Sorin Supply Agreement, the Company shall purchase electronic boards (hybrids) only from Sorin CRM SAS for assembly of localized devices. For the avoidance of doubt, in respect of CRM IPGs locally developed by the Company, the Company may purchase the electronic boards from alternative selected suppliers as appropriate with regards to price, quality and compatibility based on its own business judgment.

21.3	Aside from the electronic boards, subject to relevant agreements, a supply of other components (including leads, programmers and other accessories) necessary for the Company to manufacture and assemble IPGs will be made available by Sorin CRM SAS to the Company at the Company's cost, including all taxes, customs duties, shipping charges and other costs related to the delivery.

21.4	Except the electronic boards, the Company may for its manufacturing activities purchase from alternative selected suppliers raw materials and subassemblies (leads, programmers and other accessories) as appropriate with regards to price, quality and compatibility provided that such suppliers, raw materials and subassemblies fulfil the relevant necessary quality control requirements of Sorin.

22.1

With the objective of achieving the fastest time-to-market in the PRC, whilst meeting all necessary regulatory requirements for obtaining production licenses and product approvals, upon both Parties' agreement and by unanimous resolutions, the BOD shall decide upon the best balance between amount of local activities, complexity of start-up, and timing of initiating clinical trials and regulatory submission. The BOD shall continuously evaluate the benefit and associated return on continuing to pursue its local development program to achieve the goal of providing to the market a differentiated product accepted by the Chinese market as a Chinese domestic product. By unanimous resolutions the BOD shall decide on how to run the following multiple streams of products and whether to keep multiple programs running at the same time.

a.	For Stream One Activity, the Company shall assemble products from Sorin's existing and future platform under the Sorin Technology License Agreement.

b.	For Stream Two Activity, the Parties shall discuss, evaluate and agree on the business case for the Company to manufacture hybrid for locally developed products.

c.

Upon both Parties' agreement and the BOD's unanimous resolutions, the Company shall manufacture local pacemaker leads to complement the locally manufactured domestic pacemaker IPGs and ensure that a full suite of locally manufactured products are available to the Chinese CRM market. However, financial equilibrium has to be considered by both Parties and the BOD when deciding to manufacture internally towards procuring Third Party leads from other manufacturers. Upon both Parties' agreement and the BOD's unanimous resolutions, such leads manufactured by the Company may potentially be supplied to Sorin and/or other manufacturers for sale within the PRC, or exported outside of the PRC depending on regulatory clearance.

d.	Upon both Parties' agreement and the BOD's unanimous resolutions, the Company shall manufacture and develop local ICD/CRT IPGs and leads at a later stage depending on the market development provided that the Company has gained key technological experience through manufacturing of pacemakers.

e.	Upon both Parties' agreement and/or the resolutions of the BOD (as the case may be), the Company will aspire to identify opportunities to save production costs by identifying qualified local suppliers for components, or even locally manufacture by itself, those components, such as header, can, and battery, etc.

f.

Upon both Parties’ agreement and the BOD's resolutions, the Company shall manufacture a local CRM programmer, using an innovative approach (utilizing as much as possible commercially available computer hardware) and exploiting the opportunities offered by specific Chinese regulations. The Company shall ensure that such programmers are able to support both imported and locally manufactured CRM Products. This local programmer manufactured by the Company would eventually be Sorin’s preferred programmer within the PRC and be used by Sorin globally depending on regulatory constraints, market requirements and Sorin’s relevant requirements.

22.2	Both Parties shall agree upon an annual unit and volume target plan for the Company for locally manufactured products for the period 2014-2023 within the last quarter of a calendar year for the subsequent calendar year. The total units target shall be reviewed annually by both Parties according to the sales and marketing development.

22.3	Both Parties and the Company shall in all situations make best efforts to ensure that all new products manufactured by the Company will be accepted by the Chinese market as local products.

23.1	The Company shall actively market, promote and distribute the imported CRM Products of Sorin and locally manufactured CRM Products of the Company. The Company shall set up a competitive marketing, sales and after-sale service system in order to meet the market demand and to promote sales of the Sorin's and the Company's CRM Products

23.2

The Company shall leverage existing commercial and distribution channels of MicroPort's EP and DES product lines if suitable. MicroPort undertakes to make MicroPort's distribution network accessible to the Company at no costs for the Company by introducing existing and future dealers of MicroPort or of its Affiliates and exert its utmost reasonable efforts to cause such dealers to conclude dealership agreements with the Company on most preferential terms and conditions to the Company, assist the Company with opening up and maintaining sales channels, identifying suitable distributors, assist the Company In negotiating and concluding contracts with such distributors and in promoting the CRM Products of Sorin and the Company so as to procure the Company may realize the budgeted sales targets as set forth in the Company business plans.

23.3	The Company shall sign or have signed a separate Sorin Exclusive Distribution Agreement with Sorin Group Italia Sri. for the Company's distribution of the imported Sorin's products in the Territory which shall be renewed periodically.

23.4	The Company shall sign or have signed a separate MicroPort Exclusive Master Distribution Agreement with MicroPort for MicroPort's sales of products imported, assembled or developed by the Company.

24.1

During the effective term of this Contract, including any extension thereof, neither Party and its Affiliates may - directly or indirectly - develop, market, commercialize, manufacture or sell any CRM Products in the Territory which compete with the CRM Products manufactured, marketed, sold or distributed by the Company. MicroPort shall not and shall procure that its Affiliates do not, without the prior written approval of Sorin, engage in any CRM related activities within or outside the Territory except as provided under this Contract.

24.2

Any Party which breaches this Contract at any time during the effective term of this Contact, including any extension thereof which results in either (i) the termination of this Contact or (ii) the exercising of the Call Option as set forth in Article 35.9, the non‑compete restriction under this Article 24 shall apply to the breaching Party for an additional period of two (2) years after the termination of this Contract or the exercising of the Call Option as set forth in Article 35.9. Should any Party become the full owner of the Company, these non-compete provisions under this Article 24 shall not apply to such Party (including any of its Affiliates owning 100% of the Company).

24.3	Notwithstanding Article 24.1 and without prejudice to Article 24.2, Sorin or its Affiliates shall be permitted to, directly or indirectly, market, commercialize and distribute CRM Products of Sorin in the Territory in case the exclusivity of the distributorship of the Company under the Sorin Exclusive Distribution Agreement is duly removed or the

26.1

All labour matters of the Company shall be handled in accordance with the Labour Laws. Subject to Applicable Laws, the Company shall implement an internationally competitive and market-oriented human resources system, including the relevant human resources policies and standards appropriate for the particular conditions of the Company with due consideration to MicroPort's and Sorin's applicable human resources policies and standards.

26.3	Personnel

a.

The Company shall form, alter or terminate its labour relations with its employees according to Chinese labour law. The Company shall have the right to recruit, retain, dismiss, discipline and train its employees to the greatest extent permitted by the relevant Chinese labour laws and regulations. The Company will be using mainly local Chinese personnel, only employing expatriate personnel in cases deemed necessary. A collective labour contract compliant with relevant laws, to the extent required by law may be executed with the employees.

b.	The Parties agree that some of the employees, subject to their professional qualifications and work experience, may be hired under terms and conditions for comparable personnel of Sino-foreign equity joint ventures in the CRM industry and located in Shanghai.

c.	For selected job positions the Company may recruit Chinese or foreign individuals with an international work profile and specific qualifications for relevant senior positions in a Sino-foreign joint venture in the CRM industry. Their salaries and benefits shall be determined pursuant to common international and market practices. The number of such recruits shall be determined by the BOD.

d.	Employees will be selected from candidates according to their fit for a specific assignment in terms of professional qualification, personality, work experience, past performance, future potential and further criteria as formulated by the Management Office.

26.4	Reward and Disciplinary Measures

a.	All Company employees, including Secondees, shall observe Chinese laws and the relevant Company regulations as well as undertake responsibilities diligently in accordance with their job descriptions. The Company shall implement a performance evaluation system for all employees.

b.	The Company shall have the right to effect reward and disciplinary measures in accordance with relevant Labour Guidelines.

26.5

The employees of the Company shall have the right to establish a Labour union in accordance with the Labour Laws and other relevant laws and regulations and select the Chairman and other staff members of the Labour union according to the statutory conditions and procedures. The Company shall make allocations to the Labour union fund in accordance with relevant Chinese laws. The Labour union may use these funds in accordance with the relevant control measures for Labour union funds formulated by the All China Federation of Labour Unions. Labour union activities are, whenever possible, to be conducted after normal working hours and, in any event, in such a manner as not to hinder the operation of the Company.

26.6	The party member employees of the Company may establish the organization of the Communist Party of China according to the provisions of the Constitution of CPC to conduct relevant activities. The Company shall provide necessary conditions and facilitation for such activities.

27.1	Accounting System

a.

The Company shall set up the accounting system and procedures in accordance with relevant Chinese accounting regulations and accounting principles for enterprises. The accounting system and procedures adopted by the Company shall be approved by the BOD and be filed with the relevant local departments of finance and tax for record to the extent required by law. The accounting system and procedures shall, to the extent possible, comply with the accounting requirements of MicroPort and Sorin. The Company shall also make available in English monthly financial reports including corresponding non-financial information as determined by Sorin according to the requirements of, and the formats as prescribed by Sorin from case to case.

b.	The Company shall adopt RMB as its bookkeeping base currency, and shall, as required by Sorin, provide periodical financial statements (in the English language) converted into foreign currency denominations as described by Sorin.

c.	All accounting records, vouchers and books as well as all financial statements and reports of the Company shall be made and kept in the Chinese language in accordance with Chinese statutory requirements, and important vouchers and books shall be kept until the end of the Joint Venture Term.

27.2	Reports

a.

The Company's accounts shall be kept at the legal address of the Company. Subject to prior notice, each of the Parties shall have access to such accounts and books of the Company so that they may continuously be informed about the Company's financial performance. The Company shall in addition provide MicroPort and Sorin with annual restated financial statements in accordance with IFRS including corresponding non-financial information in the form and language as determined by MicroPort and Sorin respectively, within thirty (30) calendar days of the end of the fiscal year.

b.

The Company shall submit to the Parties, in the formats and language as required by the relevant Party, monthly financial statements, and quarterly financial statements. The submission time shall meet the requirements of the Parties and finally not be later than ten (10) Business Days after the end of each month or each quarter. The monthly financial statement shall include a detailed three months liquidity and cash flow planning for RMB and all those foreign currencies as used by the Company. Upon request of Sorin, the Company shall provide annual financial statements to Sorin in an RMB and/or foreign currency denominated version, as adopted by the Company.

27.3	Auditing

a.

The Company shall engage an internationally recognized CPA to audit its accounts and examine and verify its annual financial statements and report. Drafts of the audited financial statements and report shall be provided to the Parties and to the BOD for review within two (2) months after the end of each fiscal year, and the final audited financial statements and report shall be completed within three (3) months after the end of each fiscal year. Such financial statements shall be prepared in accordance with Chinese law and regulations pursuant to Article 27.1 (a) above and shall be provided to the Company and the Parties in a Chinese and an English version.

b.

Each Party may appoint an accounting firm registered abroad or in the PRC to review or audit all financial accounts and records of the Company on behalf of such Party in accordance with Chinese accounting regulations or IFRS according to such Party's requirements. Access to the Company's financial records shall be given to such auditor, and the Party which appoints such auditor shall cause such auditor to keep confidential all documents examined. All expenses for such audit shall be borne by the Party which appointed such auditor, unless:

g.	events in the Company (including but not limited to alleged fraud, bribery, loss of important records or other relevant financial misstatements that directly involves the rights and interests of the shareholders) have required such audit; or

h.	the CPA referred to in subparagraph (a) above has refused to confirm the Company's important records.

27.4	Risk Controlling

27.5

The Company shall adopt the calendar year as its fiscal year, with the result that each fiscal year shall begin on January 1st and end on December 31st of the same year. The first fiscal year of the Company shall begin on the date of the issuance of the Business License and end on December 31st of the same year. The last day of each calendar month shall be the financial settlement date of the Company.

27.6	Profit Distribution

a.	The Board of Directors shall determine to make annual allocations to the Statutory Funds from the after-tax net profits. The ratio for and specific amount of such allocation shall be determined by the Board of Directors.

b.	The Board of Directors shall decide the amount of after tax net profit of the Company after making up the accumulated losses of the previous years and allocations to the Statutory Funds to be distributed to the Parties.

c.	All remittances of dividends out of the PRC to Sorin shall be made in RMB or a freely convertible foreign currencies specified by Sorin to a foreign bank account designated by Sorin after withholding the Tax by the Company according to Chinese laws and regulations and subject to compliance with applicable Chinese foreign exchange control regulations.

d.	Expenses associated with any exchange of RMB to a freely convertible foreign currency or vice versa or bank remittance as provided for under this Contract shall be borne by and be a business expense of the Company.

28.1

The Company shall pay and, if applicable, withhold Tax under the relevant laws and regulations of the PRC. subject to any tax holidays, import tax reductions, waivers, exemptions, or exclusions granted to the Company from time to time by any local, municipal, provincial or central Governmental Authority or otherwise pursuant to relevant laws, regulations and policies and any applicable Tax Treaty.

28.2	The Company's Chinese and expatriate personnel shall pay individual income tax in accordance with the Individual Income Tax Law of the PRC and the relevant Tax Treaty in effect between the PRC and other countries. The Company shall withhold and turnover these taxes to the relevant Chinese authorities in accordance with Applicable Laws.

28.3

The Company shall apply for and strive to obtain all available Tax and financial benefits including Tax exemptions, holidays and reductions as well as incentives, preferential treatments or financial subsidies offered by any local, municipal, provincial or central Governmental Authority or otherwise pursuant to relevant laws, regulations and policies, subject to a related resolution of the Board of Directors.

28.4	Without prejudice to any specific stipulation contained in any of the Sorin Agreements, in case the Company is required to withhold Tax from the payments to Sorin or any of its Affiliates:

a.	The Company shall exercise its best efforts to attain that the payment to Sorin or its respective Affiliate will, at the time of payment, be taxed at the reduced taxation rate of the relevant Tax Treaty and enjoy any preferential treatment granted by Chinese Tax laws and regulations;

b.

the Company shall provide Sorin or its Affiliate with an original copy of the Tax assessment and the Tax payment certificate without delay, and these documents shall specify Sorin or its Affiliate as the taxpayer, the amount of Tax paid, the Tax rate and the amount or fee on which such rate is based, the Tax law and the legal regulation on which such Tax payment is based, and the date of payment of the Tax; and

c.	If the documents of the Governmental Authority are issued in a language other than English, the Company shall have the documents translated into English at its own expense at the request of Sorin or its Affiliate and the translation shall be done by an officially certified translator.

28.5	Upon a respective decision of the Board of Directors, the Company shall engage a Tax Consultant for the preparation or review of all Tax returns and related filings with respect to all material Taxes (e.g. corporate income tax, value added tax, business tax) to be filed under applicable laws and regulations.

28.6	In no event shall the Company be responsible for any taxes, fees and charges payable by a Party under the relevant laws for its performance of its obligations hereunder, except for any withholding that the Company Is obliged to make under relevant laws, and the Parties shall provide necessary assistances to the Company in connection herewith.

---

30.1	The Company shall establish and maintain information technology systems that adequately support all its operations.

30.2

For any interaction with the Parties or any of their Affiliates, the Company may use data storage, transmission and communication systems compatible with the Parties' or their Affiliate's systems with reference to the manner and form as recommended by the Parties. The Company shall pay for its use of IT systems to the relevant Party in accordance with a written agreement made by and between the Company and such relevant Party on at arm's length terms and conditions.

---

30.4	Any hardware and software purchased, leased and/or used by the Company shall be validly licensed to the Company, and the Company shall comply with all licenses.

31.1	The corporate CEOs or presidents of both Parties shall meet at least twice a year to facilitate the operation and management, discuss and agree on the general strategy of the Company and further cooperation between the Parties.

31.2	In addition to its other obligations under this Contract, MicroPort shall:

a.

assist the Company in applying for all licenses and permits required for the construction, leasing, acquisition or use of the Company's facilities and the operation of the Company's business, including new product program approvals, registrations and announcements of the Company's products as may be required for their manufacture and distribution by the Company, approvals under any national and other plan, and other licenses and permits necessary or supporting the Company's business objectives;

b.	support, at no cost, the Company in obtaining timely all relevant production licenses and product approvals for manufacturing CRM Products and in ensuring such production licenses remain valid under Chinese law throughout the lifetime of the Company;

c.	assist the Company in the Company's application for preferential tax treatment, financial subsidies and other investment incentives offered by the Chinese local, municipal, provincial and central Governmental Authorities or otherwise pursuant to relevant regulations and policies;

d.	assist the Company in the Company's identifying, leasing or otherwise procuring land use rights, construction of workshops and facilities as required for the Company's production and operation as set forth in Article 19 above;

e.	assist the Company in the Company's purchasing, leasing or otherwise procuring in the PRC the equipment and machinery, tools, raw materials, office furniture and equipment, vehicles, and other materials and services required for the Company's production and operations;

---

f.

assist the Company in obtaining necessary licenses and permits for the import of equipment and machinery, tools, raw materials, office furniture and equipment, vehicles and other materials required for the Company's production and operations (including tax exemptions for the import of the equipment, machinery, tools, etc.), and assist the Company in carrying out all import and customs formalities of the Company In respect thereto;

---

g.

h.	make MicroPort's existing sales and distribution network of DES and EP business accessible to the Company and provide the Company with all necessary support from MicroPort's sales and distribution network of DES and EP business at no costs for the Company;

i.	assist the Company in upgrading the Company's dealers and dealer network as well as in marketing and promoting the Company's products In the domestic market;

j.	assist the Company in obtaining and maintaining a “Foreign Exchange Registration Certificate” and other necessary approvals to utilize the various foreign exchange balancing methods permitted under Chinese laws and regulations;

k.

assist the Company in obtaining a reliable supply of electricity, water, heating, gas, steam, telecommunications, postal services and transportation required for its production and operations, and assist the Company in securing continuous and uninterrupted supply of all such utilities in an amount and quality as is required by its operation as well as at the most favorable terms and conditions possible;

l.	assist the Company in obtaining relevant information on the PRC CRM policy matters and other information relevant to the operations of the Company; and

m.	take due care of all other matters entrusted by the Company to MicroPort and agreed to by MicroPort from time to time in writing.

31.3	In addition to its other obligations under this Contract and the Sorin Technology License Agreement, upon the request of the Company and subject to relevant agreements between Sorin and the Company, Sorin shall also:

a.	make the necessary CRM-related electronics, software and components and assembly, testing and manufacturing know-how for CRM Products accessible to the Company;

b.	make all necessary design, development and testing document accessible to the Company for registration and quality assurance system audit purpose or for fulfilling the requirement of the relevant regulatory authorities in relation to product registration, quality management or post-market surveillance activities of the Company;

c.	acquire all necessary licenses and approvals for imported CRM products;

d.	support the Company in establishing connections with international key opinion leaders and academic societies;

---

e.	assist Company in components procurement, product development and providing technical support for the Company's locally developed products and necessary training subject to the relevant Sorin Agreement;

---

f.	assist employees of the Company and members of the BOD in obtaining visas, and other necessary travel documents for business travel or training outside the PRC on behalf of the Company;

g.	assist the Company in recruiting various types of qualified foreign personnel including skilled managers and technical personnel;

h.	assist the Company in organizing various trainings for the Company's employees, including technical, financial, management, IT and compliance training, subject to the terms of the Sorin Technology License Agreement and any related written agreements between the Company and Sorin;

i.	assist the Company in purchasing , leasing, installation and validation procedures for the machines, equipment, materials, office supplies, transportation tools, communication device and other materials necessary for production of the Company from outside the PRC, at the reasonable price, and in no event higher than the fair market price; and

j.	take due care of all other matters entrusted by the Company to Sorin and agreed to by Sorin from time to time in writing.

31.4

To the extent that there is no prior written agreement between a Party and the Company, such Party shall not be entitled to any fees or payments from the Company for the performance of such responsibilities other than the reimbursement of reasonable and legally proper charges advanced by that Party on behalf of the Company to Third Parties or Affiliates against invoices issued by such Third Parties or Affiliates or official receipts issued by relevant governmental authorities.

32.1

The Parties acknowledge that, prior to and during the term of this Contract, each Party or its Affiliates have disclosed and will disclose to the other Party or any Affiliates of such other Party Confidential Information. Except as may be provided in other relevant confidentiality agreements, each Party shall maintain the secrecy and confidentiality of, and shall not without the prior written approval of the other Party, disclose to any Third Party or person, any Confidential Information relating to the Company, its business operations, the products or services of the Company, or any Confidential Information disclosed to a Party by the other Party about its own business at any time during, or for the purpose of, negotiation of this Contract, or the establishment or operation of the Company. Both Parties further agree not to use any know-how, data and Confidential Information relating to the Company, its business operation, the products of the Company, or belonging to the other Party for their own purposes or for any purpose other than the operation of the Company's business.

---

---

32.2	The provisions of Article 32.1 above shall not apply to Confidential Information that can be proven by the receiving Party to the disclosing Party to:

a.	be known by the receiving Party by written records made prior to disclosure by the disclosing Party;

b.	be public knowledge prior to disclosure by the disclosing Party or to have become public knowledge thereafter by other means than through the receiving Party's breach of this Contract;

c.	have been obtained by the receiving Party from a Third Party having no obligation of confidentiality with respect to such Confidential Information; or

d.

be required by order of any competent court, arbitral tribunal, governmental authority or stock exchange to be disclosed, provided, if the Parties are required to make a public disclosure of the joint venture transaction as contemplated hereunder by the respective stock exchange where the Parties are listed respectively, the Parties shall use their best endeavour to make such public disclosure simultaneously, so that the rules of the stock exchange on which the Parties are respectively listed are duly complied with.

32.3	The Parties shall cause their directors, officers and employees, and those of their subsidiaries and Affiliates, to be also bound by and comply with the confidentiality obligations set forth in Article 32.1 above.

32.4

The Parties shall ensure that the Company implements rules and regulations to cause the members of the Board of Directors, the Management Office, senior staff and other employees of the Company as well as the Supervisors to also comply with the confidentiality obligations set forth in this Article 32. All members of the Board of Directors and the Management Office, senior staff and other employees as well as the Supervisors of the Company having access to Confidential Information shall be required to sign a confidentiality undertaking in a form acceptable to the Parties.

32.5	If any Party or the Company breaches any provision of this Article 32, the breaching Party shall pay liquidated damages of not less than RMB one (1) million per each violation, until

---

---

32.6

The provisions of this Article 32 shall remain binding upon any Party including its successors and assignees and any purchaser of any equity interest in the Company even after such Party, successor, assignee or purchaser, through an assignment of equity interest and corresponding contractual rights and obligations, ceases to be a party to this Contract. In addition, the rights and obligations under this Article 32 shall survive the expiration or early termination of this Contract, and shall remain in effect for the periods stated herein, notwithstanding the dissolution of the Company.

33.1	Representations and Warranties

a.	It has the capacity and authority to enter into and to perform its obligations under this Contract, and is duly incorporated and in good standing and valid existence under the laws of the jurisdiction in which it is incorporated;

b.

Its execution and delivery of this Contract or its performance of any provisions hereunder will not contravene, violate or deviate from, or constitute breach under, any contract, instrument, articles of association or bylaw, rules, regulations, orders, judgments, decree or laws to which it is a party or by which it is bound or constrained, nor will its execution of this Contract or Its performance of any obligations and observance of any provisions hereof be restricted by any such contract, instrument, articles of association or bylaw, rules, regulations, orders, judgments, decree or laws;

c.	It has duly authorized, executed and delivered this Contract and that this Contract constitutes, following its effectiveness, legal, valid and binding obligations enforceable in accordance with its terms;

d.	It has willingly entered into this Contract, and it has never assumed nor will it ever assume any type of obligation or make any type of undertaking if such obligation or undertaking shall disrupt or interfere with in any way its acceptance or performance of any obligations hereunder; and

e.

At the time of execution, it has obtained all authorizations for execution and performance hereof, including any authorization required in order to comply with its internal policies and internal governance principles. In the course of this Contract, if there is any conflict with its internal policies and internal governance principles, this Contract shall prevail, however, the Company shall actively coordinate the issue with the relevant Party.

33.2	Indemnification

a.	MicroPort shall indemnify and hold Sorin and the Company harmless from any and all obligations, losses, and damages caused as a result of or in connection with any false or misleading information in the representations and warranties MicroPort made under this Contract or any breach of any such representation and warranty on the part of MicroPort.

b.

MicroPort shall, as directed by Sorin and/or the Company, (i) take all necessary measures to remedy any false or misleading information in or any breach of any representations and warranties as set forth above within thirty (30) calendar days from the date of a notice given by Sorin and/or the Company; and/or (ii) indemnify Sorin and/or the Company in an amount equal to the loss and liabilities caused as a result of or in connection with any false or misleading information in or any breach of any representation and warranty on the part of MicroPort, provided however that such loss and liabilities would not have arisen in the absence of any such false or misleading representation and warranty or any such breach of any representation and warranty by MicroPort. Such claims by Sorin and/or the Company shall not prejudice or compromise any other remedies, including damages, which may arise and become available to Sorin and/or the Company in connection with such false or misleading representation and warranty or any such breach of any representation and warranty on the part of MicroPort.

c.	Sorin shall indemnify and hold MicroPort and the Company harmless from any and all obligations, losses, and damages caused as a result of or in connection with any false or misleading information in any representation and warranty it made under this Contract or any breach of any such representation and warranty on the part of Sorin.

d.

Sorin shall, as directed by MicroPort and/or the Company, (i) take all necessary measures to remedy any false or misleading information in or any breach of any representations and warranties as set forth above within thirty (30) calendar days from the date of a notice given by MicroPort and/or the Company; and/or (ii) indemnify MicroPort and/or the Company in an amount equal to the loss and liabilities caused as a result of or in connection with any false or misleading representation and warranty or any breach of any representation and warranty on the part of Sorin, provided however that such loss and liabilities would not have arisen in the absence of any such false or misleading representation and warranty or any such breach of any representation and warranty on the part of Sorin. Such claims by MicroPort and/or the Company shall not prejudice or compromise any other remedies, including damages, which may arise and become available to MicroPort and/or the Company in connection with such false or misleading representation and warranty or any such breach of any representation and warranty on the part of Sorin.

34.1	This Contract shall come into effect on the Approval Date.

34.2	However, this Contract shall not be submitted to the Examination and Approval Authority for approval unless the Parties have acknowledged to each other that each of them was either satisfied that the following pre-conditions have been duly fulfilled or has waived those pre-conditions that may not have been fulfilled:

a.	this Contract, its Annexes, the Articles of Association and all other documents in relation to the Company's establishment which have to be submitted to the Examination and Approval Authority have been signed by duly authorised representatives of the Parties and other parties, who according to such document are foreseen to sign;

b.	all those Sorin and MicroPort Agreements which either of the Parties requires to be signed by the relevant parties before the submission of the documents referred to in sub-paragraph (a) above have been signed by or on behalf of duly authorised representatives of such parties;

c.	the Board of Directors of Sorin have given the unconditional approval to the signing and submission of this Contract and the above documents;

d.	the Board of Directors of MicroPort have respectively given the unconditional approval on the signing and submission of this Contract and the above documents; and

e.	all required anti-monopoly filings have been made, no objections have been received and all required anti-trust clearance including approvals have been obtained.

34.3	This Contract shall be binding upon the Parties as of the Approval Date, and the Parties agree to fulfil all their obligations pursuant to the provisions hereof. The Parties shall register this Contract at the Administration for Industry and Commerce within thirty (30) days after the Approval Date and shall carry out the formalities necessary for obtaining the Business License.

35.1	The Joint Venture Term established under this Contract shall be ten (10) years, commencing on the date of issuance of the Business License. The Joint Venture Term shall be extended for additional five (5) years periods, unless one Party disagrees with such extension by sending a prior written notice to the other Party at latest six (6)month before expiry of the then current Joint Venture Term.

35.2

If neither Party has disagreed about the extension of the Joint Venture Term as set out in Article 35.1, the Parties and the BOD shall jointly prepare all required documents (including any agreements between the Parties, BOD resolutions and amendments to this Contract and the Articles and Association) for the extension of the Joint Venture Term as set out in Article 35.1, and the application for extension shall be submitted by the Company to the Examination and Approval Authority for approval at latest six (6) months before expiry of the Joint Venture Term.

35.3	This Contract may be terminated at any time by the written agreement of the Parties.

35.4	Without prejudice to any other termination rights set out elsewhere in this Contract, any Party may unilaterally terminate this Contract by written notice to the other Party if:

a.	the conditions or consequences of Force Majeure significantly interfere with the normal functioning of the Company for a period in excess of six (6) months and the Parties have been unable to find an equitable solution;

b.	the Company's Business License, approval certificate, the production license and/or other approvals or permits in respect of manufacturing and distribution of CRM Products are cancelled, revoked or suspended such that the Company Is rendered unable to conduct its main business activities for more than one hundred and eighty (180) calendar days;

c.	a Party or Parties becomes bankrupt or insolvent, or is the subject of proceedings for liquidation or dissolution and such proceedings are not dismissed within sixty (60) calendar days from the date such proceedings are issued, or a Party enters into an arrangement with its creditor or ceases to carry on business or becomes unable to pay its debts as they come due;

d.	any Governmental Authority (including for this purpose any court) expropriates or requisitions, or orders the expropriation or requisition of, all or material portion of the assets or properties of the Company and such expropriation or requisition has a material adverse impact on the performance of the Company's business;

e.	such Party is prevented from enforcing any of its rights under this Contract, the Articles of Association of the Company or any Sorin Agreement or any MicroPort Agreement for a period of more than six (6) months due to an act of a Governmental Authority or due to a change of Chinese law or governmental policies.

f.

35.5	Without prejudice to any other termination rights set out elsewhere in this Contract, a Party (“Non-Affected Party”) may unilaterally terminate this Contract by written notice to the other Party, if:

a.

the other Party (“Affected Party”) fails to make its contributions to the registered capital of the Company in the amount or value or within such times or at the terms and conditions as agreed between the Parties, and such failure is not cured within one (1) month after delivery of a written notice to the Affected Party by the Non-Affected Party or the Company in which the Non-Affected Party or the Company demands that it be cured by the Affected Party or other period as agreed by the Parties;

b.	the other Party (“Affected Party”) materially breaches this Contract or violates the Company's Articles of Association and such breach or violation is not cured within one (1) month after delivery of a written notice to the Affected Party by the Non-Affected Party in which the Non-Affected Party identifies the breach and demands that it be cured by the Affected Party;

c.

the other Party (“Affected Party'') or any of its Affiliates has materially violated any of the agreements that it has entered into with the Company, resulting in the Company's failure to operate normally, and, despite receipt of a written reminder of the Company or of the Non-Affected Party to such effect, does not remedy such breach within one (1) month upon the receipt of the said written reminder,

d.	the other Party (“Affected Party”) transfers its equity interest in the Company or grants an Encumbrance or allows an Encumbrance to exist on its equity interest in the Company in violation of the provisions of this Contract;

e.	any Governmental Authority (including for this purpose any court) expropriates or requisitions, or orders the expropriation or requisition of, all or material portion of the assets or properties of Sorin or MicroPort (the concerned party is referred to as (“Affected Party”) and such expropriation or requisition has a material adverse impact over the performance of the Company's business;

f.	a Change of Control occurs with respect to the other Party (“Affected Party'') (including any legal successor of the Affected Party as shareholder of the Company).

35.6

Without prejudice to any other termination rights set out in other provisions of this Contract, Sorin may unilaterally terminate this Contract by a written notice to MicroPort, if the Capital Increase and Accession Agreement, the Sorin Technology License Agreement, the Sorin Supply Agreement, Sorin Exclusive Distribution Agreement terminates not due to a reason attributable to Sorin or its respective Affiliates. Without prejudice to any other termination rights set out in other provisions of this Contract, MicroPort may unilaterally terminate this Contract by a written notice to Sorin, if the Capital Increase and Accession Agreement or MicroPort Exclusive Master Distribution Agreement terminates not due to a reason attributable to MicroPort or its respective Affiliates.

35.7	If a Party entitled to terminate gives a notice of its intention to terminate the Contract to the other Party, the Parties shall immediately conduct negotiations to resolve the dispute. If:

a.	no resolution of the dispute is reached to the satisfaction of the notifying Party within one (1) month after the other Party's receipt of such notice; or

b.	the notified Party fails to cooperate by promptly commencing negotiations within one ( 1) month upon receipt of said notice,

35.8	The termination under this Contract shall not affect or substitute any other rights, claims or remedies that may be available to a Party or the Company. Any termination shall neither relieve the Affected Party from liabilities accrued to the date of termination nor relieve the Affected Party from liabilities to the Non-Affected Party or the Company.

35.9

Without prejudice to any other termination rights set out in other provisions of this Contract, in the event that a Change of Control occurs with respect to the other Party (“Affected Party'') (including any legal successor of the Affected Party as shareholder of the Company), the Affected Party must notify the other Party (“Non-Affected Party”) in writing of such Change of Control immediately and the Non-Affected Party is entitled to acquire all or part of the equity interest held by the Affected Party (“Share Transfer”) in the Company (“Call Option I”). The Non-Affected Party shall notify the Affected Party of its intention to exercise its Call Option I in writing within three (3) months of receipt of the written notice from the Affected Party about such Change of Control; otherwise, It is deemed that the Non-Affected Party waives its right to exercising Call Option I. The consideration for the Share Transfer shall be:

a.	If the Company at average has been unprofitable during the Assessment Period, the Net Asset Value of the Company at the Cut-off Date.

b.	If the Company at average has been profitable during the Assessment Period the higher one of the following (i) or (ii):

a.	ten (10) times the average net profit of the Company during the Assessment Period, or

a.	the price based on the PIE ratio of the transaction resulting in the Change of Control.

35.10

Without prejudice to any other termination rights set out in other provisions of this Contract, in the event that one Party (“Affected Party”) materially breaches this Contract or violates the Company's Articles of Association and such breach or violation is not cured within one (1) month after delivery of a written notice to the Affected Party by the Non-Affected Party in which the Non-Affected Party identifies the breach and demands that it be cured by the Affected Party, the Non-Affected Party is entitled to purchase all or part of the equity interest held by the Affected Party in the Company (“Call Option II”). The Non-Affected Party shall notify the Affected Party in writing of its intention to exercise its Call Option II within three (3) months of the end of the aforementioned one (1 )-month cure period; otherwise, it is deemed that the Non-Affected Party waives Its right to exercising Call Option II. The consideration for such equity transfer shall be:

a.	If the Company at average has been unprofitable during the Assessment Period, the Net Asset Value of the Company at the Cut-off Date.

b.	If the Company at average has been profitable during the Assessment Period, ten (10) times the average net profit of the Company during the Assessment Period.

35.11

Immediately upon the notification of the Non-Affected Party to the Affected Party of its intention to exercise Call Option I or II (as the case may be), the Parties shall enter into good faith negotiations to affect the Share Transfer pursuant to the principles set out in Articles 35.9 and 35.10. If no agreement is reached between the Parties on all terms and conditions of such Share Transfer within thirty (30) calendar days, the Non-Affected Party shall have the right to nominate a CPA to determine in accordance with applicable accounting laws and standards any of the following: (i) whether the Company has been on average profitable or unprofitable during the Assessment Period, (ii) the average profit of the Company during the Assessment Period, (iii) the price based on the P/E ratio of transaction resulting in the Change of Control, (iv) the Net Asset Value of the Company at the Cut-off Date. Such determination of the CPA shall be binding on the Parties. The cost of the CPA shall be borne by the Affected Party.

35.12

If, due to any requirements under Chinese law or governmental policies the exercise of the Call Option set out in Articles 35.9 and 35.10 results in the performance of a specific procedure granting anyone other than the Non-Affected Party or a person nominated by it the opportunity to acquire the concerned equity interest in the Company, then the Non-Affected Party shall have a pre-emptive right. If, due to any regulatory restrictions under Chinese law or governmental policies a Party, an Affiliate or a Third Party, as the case may be, is prevented from acquiring all or part of the Company's equity interest in accordance with Articles 35.9 and 35.10, the Non-Affected Party may nominate a Third Party or Affiliate which is neither a Competitor nor of the same nationality as the Non-Affected Party to acquire all or part of the equity interest of the Affected Party. Alternatively and at the request of the Non-Affected Party, the Affected Party shall take all necessary actions and undertakes to cooperate to change the Business Scope of the Company, pursuant to instructions by the Non-Affected Party, In such a way that the Non-Affected Party is no longer prevented from acquiring all or part of the Company's equity interest. Such request may be made by the Non-Affected Party at any stage of the procedure required to implement any of its rights under this Article 35.

35.13

If any required Governmental Approvals cannot be obtained for the transfer of equity within one hundred eighty (180) calendar days after the signing of the related equity interest transfer agreement, such agreement shall be null and void and the Company shall be liquidated in accordance with the provisions of this Contract, unless an extension is mutually agreed to by the relevant parties or a written request is made by the Non-Affected Party.

35.14

In cases of termination and/or exercising Call Option in compliance with this Article 35 the Parties shall take all necessary actions, in particular execute all necessary agreements and other documents necessary to facilitate the transfer of equity interest or the liquidation of the Company and shall cause its appointees on the Board of Directors to pass resolutions in favour of and facilitating any and all matters regarding the related transfer of equity interest or liquidation and corresponding adjustment of the Contract and the Articles of Association of the Company, as well as use its best efforts to cooperate, coordinate and assist the Company in all aspects with regard to the transfer of equity interest or liquidation and corresponding adjustment of the Contract and the Articles of Association of the Company, including but not limited to submitting all relevant signed documents to the Examination and Approval Authority according to law and registration with the competent authority without any delay. MicroPort’s related obligations hereunder include to use its best efforts to obtain all approvals and the like authorizations which may be required to implement the concerned transaction without the performance of a statutory bidding or auctioning procedure and to arrive at a price for the concerned equity interest transfer equalling the one as determined in compliance with the relevant regulations under this Article 35. MicroPort shall ensure that in case of a statutory bidding or auctioning process none of its Affiliates will bid for MicroPort's equity interest in the Company that may be offered for transfer.

36.1

Liquidation shall be commenced on the date determined by a respective resolution of the Board of Directors, when approval to such liquidation is received from the Examination and Approval Authority, or on the date when the Company is dissolved or the Company's operations are otherwise terminated by virtue of any court order, arbitral award or administrative order, or on the date of expiry of the Joint Venture Term, whichever comes earliest.

36.2	The Board of Directors shall within fifteen (15) calendar days from the beginning of the liquidation, appoint a Liquidation Panel that shall represent the Company in all legal matters during the period of liquidation. The Liquidation Panel shall evaluate and liquidate the Company's assets in accordance with applicable Chinese laws and regulations and the principles set out herein.

36.3

Unless otherwise required by mandatory law, the Liquidation Panel shall be made up of as many members as the Company has Directors, and half of the members shall be appointed by MicroPort and the other half shall be appointed by Sorin. Members of the Liquidation Panel may be selected from the Directors of the Company. Any Party may also appoint professional advisors to be members of or to assist the Liquidation Panel.

36.5

The Liquidation Panel shall conduct a thorough examination of the Company's assets and liabilities, on the basis of which it shall, In accordance with the relevant provisions of this Contract, develop a liquidation plan which, if approved by the Board of Directors, shall be executed under the Liquidation Panel's supervision. Settlement of any claim, creditor's rights or debt under liquidation shall be approved by all members of the Liquidation Panel.

36.6	In developing and executing the liquidation plan, the Liquidation Panel shall exert every effort to obtain the highest possible price for the Company's assets.

36.7	The liquidation expenses, including remuneration to members of and advisors to the Liquidation Panel, shall be paid out of the Company's assets in priority to the claims of other creditors.

36.8

After the Liquidation Panel has paid the liquidation fee, the remuneration to the staff and the labour insurance charges as well as the taxes in arrear and has settled all legitimate debts of the Company in accordance with laws, any remaining assets shall be distributed to the Parties in accordance with the capital contribution ratio of the Parties. With respect to fixed assets, the Liquidation Panel shall have such assets appraised by a CPA to be retained by the Liquidation Panel and transformed into proceeds by selling it to the Parties against a compensation equalling the appraised value. As regards any fixed assets required or useful for the production of CRM Products, Sorin shall, and as regards other fixed assets, MicroPort shall enjoy the first right of refusal under the same conditions. Fixed assets not purchased by a Party within thirty (30) Business Days following the Parties' receipt of the relevant appraisal report shall be offered for sale to Third Party. Fixed assets not sold to Third Party after ninety (90) Business Days shall be distributed to the Parties in accordance with their capital contribution ratio in the Company. In the process of selling fixed assets to Third Party, the Parties shall have the pre-emptive right over the Third Party during the liquidation period to purchase such fixed assets on the same terms and at the same price as offered to any Third Party.

36.9	On completion of liquidation, the Liquidation Panel shall prepare a liquidation report and the liquidation accounting statements. The Liquidation Panel shall, by unanimous decision, appoint an accounting firm to examine the report and statement and issue a verification report.

36.10	Upon expiry or termination of this Contract:

a.	the provisions of this Contract in relation to representations and warranties, compensation of damages, indemnification, confidentiality, settlement of disputes, termination, buy-out and liquidation of the Company shall survive the expiry or termination of this Contract; and

b.

unless upon specific prior written agreement between the Parties, no Party shall have any right to use, either directly or through its Affiliates, any IPR or similar rights owned by any other Party or by the Company or to produce or distribute any products of any other Party or its Affiliates that such other Party or its Affiliates have licensed to the Company or any products produced by the Company primarily based on the technical data or information provided by such other Party or its Affiliates.

c.

37.1	Notice

37.2	Performance

38.1	In the event any dispute arises between the Parties out of or in relation to this Contract, including any dispute regarding its breach, termination or validity, the Parties shall attempt in the first instance to resolve such dispute through friendly consultations.

38.2

If the dispute has not been resolved by friendly consultations within sixty (60) calendar days after one Party has served written notice to the other Party requesting the commencement of such consultations, then any concerned Party may demand that the dispute be finally settled by arbitration under the Rules of the Hong Kong International Arbitration Centre in force at the time of commencement of the arbitration in accordance with said Rules and with the following provisions:

a.	the place of arbitration shall be Hong Kong;

b.	The arbitral proceedings shall be kept confidential, unless the disclosure is required in accordance with relevant laws and regulations. The language of the arbitral proceedings shall be English and the Chinese translation shall be provided at the costs for the Party who requires such translation;

c.	in any arbitration proceedings, any legal proceedings to enforce any arbitration award and in any other legal proceedings between the Parties pursuant to or relating to this Contract, each Party expressly waives the defense of sovereign immunity and any other defense based on the fact or allegation that it is an agency or instrumentality of a sovereign state or is otherwise entitled to immunity;

d.

e.	the tribunal shall consist of three (3) arbitrators;

f.	the presiding arbitrator shall neither be an Italian nor a Chinese national;

g.	the Parties hereby agree that any arbitration award rendered in accordance with this Article shall be final and binding upon the concerned Parties, and the Parties further agree that such award may be enforced by any court having jurisdiction over the Party against which the award has been rendered or over the assets of such Party wherever the same may be located; and

h.	after submittal of the dispute to arbitration, the Parties shall continue to exercise any other rights and perform any other obligations hereunder, unless such obligations are directly related to the matter under dispute.

40.1	Applicable Laws

40.2	Change of Law

41.1	The Parties shall comply and procure that the Company complies with all import and export control and embargo laws applicable to the Company.

41.2

Each Party in particular undertakes to one another that each Party shall procure that neither it nor any of its Affiliates nor the Company, nor any director, trustee, officer, employee, beneficiary, supplier, dealer and agent or representative (nor any of their immediate family members or spouses or other related persons) of any of them, nor any person associated with or acting for, or on behalf of, any of them, shall with respect to (i) the Parties' holding of equities in the Company and/or (ii) the matters and activities relating to the Company directly or indirectly:

a.	make any unlawful payment to foreign or domestic Government Officials or to foreign or domestic political parties or campaigns or violate any Anti-Corruption Laws;

b.	use any funds for unlawful contributions, gifts, entertainment or other unlawful expenses relating to political activity;

c.	make any illegal contribution, gift, bribe, rebate, payoff, influence payment, kickback, or other payment to any person, private or public, regardless of what form, whether in money, property, or services to any person:

i.	to obtain favourable treatment for the Company or contracts secured,

j.	to pay for favourable treatment for the Company or contracts secured,

k.	to obtain special concessions or for special concessions already obtained, or

l.	in violation of any Applicable Laws;

d.	establish or maintain any fund or asset that has not been properly recorded in the books or records of the Company; or

e.	authorise or tolerate any of the above.

41.3	Compliance Guidelines, Compliance Programme and Organisation

a.	The Parties undertake to one another that each Party shall procure the adoption of the compliance guidelines at the first meeting of the Company's Board of Directors.

b.

The Board of Directors shall be responsible for the implementation (including but not limited to, the appointment and replacement of relevant officers) and continued improvement of a compliance programme and organisation at the Company which aim to ensure the conformity of the Company's activities with all Applicable Laws and the compliance guidelines in accordance with milestones to be established by the Board of Directors. Each Party may provide guidelines to the Company In relation to the Company's compliance programme and organisation, such guidelines may be adopted or amended by the resolutions of the Board of Directors in consideration of the specific situations of the Company.

c.

The Board of Directors shall have the right to modify or supplement the compliance guidelines and the compliance programme and organisation when and in a way as it deems fit. The Parties undertake to one another that each Party shall procure the implementation of any modifications of the compliance guidelines and the compliance programme and organisation and of all other decisions resolved by the Board of Directors at the level of the Company.

41.4	Remediation Obligation

a.	If a Party becomes aware of an indication that the Company may be in breach of Applicable Laws and/or the compliance guidelines, such Party shall provide a notice setting forth such indication to the other Party and the Company. Upon receipt of such notice the Company shall procure that:

m.	the respective indication is being investigated by an accounting and/or law firm of international reputation; and

n.	any measure that may be required to remedy potential breaches of Applicable Laws and/or compliance guidelines shown by such indication (including by dismissing employees that have breached Applicable Laws and/or compliance guidelines) is being taken.

b.

The Company shall cause the engaged accounting and/or law firm to provide a written report setting forth the work plan and, subsequently, the results of the investigation to the Parties. Each Party shall have the right to observe the implementation of such investigations and all related measures. All costs or loss of profits associated with the investigation and remediation of any violation of Applicable Laws and/or compliance guidelines shall be borne by the Company. The Parties undertake to one another that each Party shall procure the Company's adherence to its obligations set forth in this subparagraph.

41.5	Investigations by a Governmental Authority

41.6	Audit Rights, Suppliers and Sales Intermediaries Due Diligence

a.

Upon written request of a Party, the Company shall permit such Party and such Party's representatives, including external advisors, during normal working hours to examine the Company's compliance with Applicable Laws and/or the compliance guidelines by reviewing and making copies of the Company's books and records that are relevant for the verification of said compliance and matters relating to the business of the Company, provided that the examination of such Party and its representatives does not affect the normal operation of the Company. The Company shall assist such Party and such Party's representatives, including its external advisors, in every way to carry out its right as per the preceding sentence, in particular by:

o.	promptly providing all Information and materials, and

p.	permitting unhindered access and inspection of said books and records.

b.

At any time a Party shall have the right to request the Company to conduct compliance due diligences with respect to all or some of the Company's suppliers or Sales Intermediaries. Upon such request, the Company shall procure that such due diligences are being conducted immediately and shall procure that the outcome of such due diligences are promptly being provided to the Parties. If, based on the outcome of such due diligences or otherwise, a Party becomes aware of (an) indication(s) that one or more suppliers or Sales Intermediaries may not be in compliance with Applicable Laws or the compliance guidelines, that Party shall have the right to instruct the Company to replace the respective supplier or Sales Intermediary or to amend the agreement(s) underlying the relationship between the Company and the respective supplier or Sales Intermediary. The Company shall procure the prompt implementation of such instruction. The Parties undertake to one another that each Party shall procure the Company's adherence to its obligations set forth in this subparagraph.

43.1	Language

a.	This Contract is made and executed in both Chinese and English, both of which shall have the same effect.

b.	If the Parties, the Company or any of its organs produce legal documents in Chinese and in English pursuant to this Contract, both versions shall be equally valid and authentic

43.2	Waiver and Preservation of Rights

43.3	Costs

43.4	Notices

43.5	Severability

43.6	Modification and Amendment

43.7	Successors

43.8	Headings

43.9	Originals

---

---

1.	Shanghai MicroPort Medical (Group) Co., Ltd with its legal address at 501 Newton Rd., Zhangjiang Hi-Tech Park, Shanghai 201203, the PRC, and registered with Shanghai Administration for Industry and Commerce under No. 310115400053238, legal representative Zhaohua Chang

2.	Sorin CRM Holding SAS with its legal address at 4 avenue Reaumur, 92143 Clamart cedex, France, and registered with the Greffe du Tribunal de Commerce de Nanterre, France, under No. 751 624 198 R.C.S. NANTERRE, legal representative Alexander H.J. Neumann

3.	MICROPORT WEIBO MEDICAL DEVICES (SHANGHAI) CO., LTD. with its legal address at Room 101, Unit 2, 501 Newton Rd., Zhangjiang Hi-Tech Park, Shanghai 201203, and registered with the Pudong New Area Sub-bureau of Shanghai Administration for Industry and Commerce under No. 310115002124521, legal representative Qiyi Luo

---

---

---

Article 1	Definition

1.1	Definitions

a.	AIC means the competent Administration for Industry and Commerce, which according to law is competent to handle modification registration for the Company in respect of the transactions contemplated hereby.

a.	Approval Authority shall mean the Shanghai Commission of Commerce or any other authority which is the examination and approval authority competent to approve this Agreement.

b.	Articles of Association shall mean the Articles of Association of the Company executed by MicroPort on 7 May 2013.

c.	Business Day means Monday through Friday, except for public state holidays of the PRC.

d.	Capital Increase shall have the meaning as set out in Article 3.1of this Agreement.

e.	Company shall mean MicroPort Weibe Medical Devices (Shanghai) Co., Ltd.

f.	CRM shall mean cardiac rhythm management.

g.	Effective Date shall mean the date on which this Agreement becomes valid and effective as per 0.1 of this Agreement.

h.	Increased Registered Capital has the meaning as set out in 0.1 of this Agreement.

i.	Joint Venture Contract shall mean the Joint Venture Contract entered into by and between MicroPort and Sorin on January 9th, 2014 and attached hereto as Annex 1.

j.	Knowledge means, with respect to any Person that is not an individual, the knowledge after due inquiry of such Person's directors and executive officers and all other officers and managers having responsibility relating to the applicable matter or, in the case of an individual, knowledge after due inquiry.

k.

Liability means any debt, loss, damage, adverse claim, fines, penalties, liability or obligation (whether direct or indirect, known or unknown, asserted or unasserted, absolute or contingent, accrued or unaccrued, matured or unmatured, determined or determinable, liquidated or unliquidated, or due or to become due, and whether in contract, tort, strict liability or otherwise), and including all costs and expenses relating thereto including all fees, disbursements and expenses of legal counsel, experts, engineers and consultants and costs of investigation).

---

m.	Material Adverse Effect means a material adverse effect on (i) the near-term or long-term projected business, assets, properties, results of operations, condition (financial or otherwise) or prospects of the Company or (ii) the value of the Company.

n.	MicroPort shall mean Shanghai MicroPort Medical (Group) Co., Ltd.

o.	New Capital has the meaning as set out in 0.1of this Agreement.

p.	Ordinary Course of Business means the ordinary and usual course of day-to-day operations of the business of the Company through the Signing Date consistent with past practice and in compliance with applicable laws.

q.	Person means any individual, corporation, limited liability company, partnership, firm, joint venture, association, joint-stock company, trust, unincorporated organization, university, or other entity or enterprise.

r.	PRC means the People's Republic of China which, for the purpose of this Agreement, excludes the Hong Kong Special Administrative Region, the Macau Special Administrative Region and Taiwan.

s.	Revised Articles of Association shall mean the revised version of the Company's Articles of Association which is attached hereto as Annex 2.

t.	Revised Business License shall mean the revised business license of the Company to be issued by the competent AIC following the effectiveness of this Agreement.

u.	RMB means Renminbi, the lawful currency of the PRC.

v.	Sorin shall mean Sorin CRM Holding SAS.

w.	Transition Period has the meaning as set out in 0.3 of this Agreement.

1.2	Interpretation

---

Article 2	Accession of Sorin

Article 3	Increase of Registered Capital and Total Investment

3.1

On the Effective Date and subject to the terms and conditions set forth hereinafter, the Parties hereby agree to increase the registered capital of the Company from RMB Four Hundred Fifty Thousand (RMB 450,000) to RMB One Hundred Twenty Two Million (RMB 122,000,000) (“Increased Registered Capital”) and the difference between the current registered capital and the Increased Registered Capital (“New Capital”) shall be contributed through the investment respectively made by MicroPort and Sorin in accordance with 0 herein (“Capital Increase”).

3.2	The Parties further agree that the total investment of the Company shall be Three Hundred Sixty Six Million (RMB 366,000,000) after the completion of the Capital Increase.

Article 4	Subscription of New Capital

4.1

On the Effective Date and subject to the terms and conditions hereinafter, MicroPort shall subscribe RMB Sixty One Million Seven Hundred Seventy Thousand (RMB 61,770,000) of the New Capital which together with MicroPort's existing equity interest in the Company's registered capital accounts for fifty-one per cent (51%) of the Increased Registered Capital of the Company. The contribution of MicroPort to the New Capital of the Company shall be made as follows:

4.2	On the Effective Date and subject to the terms and conditions hereinafter, Sorin shall subscribe RMB Fifty Nine Million Seven Hundred Eighty Thousand (RMB 59,780,000) of the New Capital which accounts for forty-nine per cent (49%) of the Increased Registered Capital of the Company. The contribution of Sorin to the Increased Registered Capital of the Company shall be made as follows :

---

4.3	On the Effective Date, MicroPort and Sorin shall respectively have the following equity interests in the Increased Registered Capital of the Company:

x.	MicroPort's subscribed contribution to the Increased Registered Capital of the Company is RMB Sixty Two Million Two Hundred Twenty Thousand (RMB 62,220,000) and equals a fifty-one per cent (51%) equity interest of the Increased Registered Capital of the Company;

y.	Sorin's subscribed contribution to the Increased Registered Capital of the Company is RMB Fifty Nine Million Seven Hundred Eighty Thousand (RMB 59,780,000) and equals a forty-nine per cent (49%) share of the Increased Registered Capital of the Company.

4.4	MicroPort and Sorin agree to make their respectively subscribed contributions to the Company's Increased Registered Capital as stipulated in the Joint Venture Contract, and the Revised Articles of Association as far as such contributions have not already been paid by a Party prior to the Effective Date.

4.5	MicroPort and Sorin further agree that upon the Effective Date they shall continue the Company, enjoy any and all rights and assume any and all obligations associated with their respective share in the Company's Increased Registered Capital as are set out in the Joint Venture Contract,its Annexes and the Revised Articles of Association.

Article 5	Covenants

5.1	Each Party shall from time to time during the term of this Agreement execute and deliver all such further documents and agreements and take all such further actions as the other Party may reasonably require and which are consistent with this Agreement in order to effectively consummate this Agreement.

5.2

Prior to the date of issuance of the Revised Business License, MicroPort shall keep, and shall cause the Company to, and the Company shall keep Sorin informed as to all material matters involving the operations and businesses of the Company. MicroPort shall, upon receiving a prior written request from Sorin, submit or cause the Company to and the Company shall submit to Sorin basic financial information of the Company including but without limitation to balance sheet, cash flow, and income statement on a monthly basis.No information provided to or obtained by Sorin pursuant to this Article 5.2 shall limit or otherwise affect the remedies available hereunder to Sorin (including Sorin's right to seek indemnification pursuant to Article 5.9), or the representations or warranties of the Parties hereto.

---

5.3

From the Signing Date until the date of issuance of the Revised Business License of the Company (“Transition Period”) MicroPort shall cause the Company to and the Company shall conduct the business of the Company in the Ordinary Course of Business. Any major business or other transactions outside the Ordinary Course of Business involving payment by the Company of an amount exceeding RMB 100,000 (in words: RMB One Hundred Thousand) or its equivalent in foreign exchange, as well as the disposal of any major assets (i.e. assets with an individual or combined value exceeding RMB 100,000 (in words: RMB One Hundred Thousand) or its equivalent in foreign exchange) shall be subject to prior written consent from Sorin.

---

5.5

During the Transition Period MicroPort shall exercise its voting or other rights pertaining to or deriving from its shares in the Company's registered capital solely in a way that does not have any adverse effect on the enterprise value of the Company to the disadvantage of Sorin and/or the Company. This includes in particular also the prohibition to declare any dividends, other profits or benefits and the distribution of such dividends, other profits or benefits.

5.6

During the Transition Period, MicroPort and the Company shall refrain from any action that might have an adverse effect on or might jeopardize due performance of this Agreement. In particular, prior to taking any action and/or activity in relation to the Company, and/or exercising any right MicroPort enjoys under the Articles of Association MicroPort and the Company (as applicable) shall consult and coordinate with Sorin and shall exercise the respective right only upon prior written consent from Sorin.

5.7	MicroPort and the Company shall cause the members of the Company's board of directors and the Company's supervisor(s) as well as the Company's senior managers to take all measures required or recommendable to timely perform this Agreement.

5.8

To the extent permitted by law, the Company shall and MicroPort shall procure the Company to commence the process of application for all approvals, permits, and/or fulfil the formalities with the competent authorities required for the due performance of this Agreement within sixty (60) calendar days from the Signing Date, including but not limited to all approvals, permits, and formalities required to be performed and preconditions to be satisfied by the Company for duly performing this Agreement, provided that both MicroPort and Sorin shall have prepared all the application documents required by the relevant governmental authorities to be issued or provided by them respectively. In order to obtain the approvals, permits, registrations and/or fulfil the formalities from the competent authorities required for the due performance of this Agreement in due time, MicroPort and Sorin shall respectively make their best efforts to issue and provide required documents. As far as any action by any Party is required in this regard, such Party shall carry out such action without undue delay.

5.9	MicroPort and the Company shall take all measures necessary or recommendable in favour of Sorin to ensure and safeguard in compliance with obligations of MicroPort and the Company under this Agreement that during the Transition Period the operation of the Company must not be disturbed, hindered, blocked or otherwise be affected to the disadvantage of the Company, or Sorin.

5.10	In the event of any breach or non-fulfilment by MicroPort or the Company of any obligation under this 0, MicroPort and the Company shall be jointly and severally liable for putting Sorin, or at the election of Sorin, the Company, into the same position it would be in if the defaulted or non-fulfilled obligation had been duly performed by MicroPort and/or the

---

---

Article 6	Representations and Warranties

6.1	Each Party represents and warrants the following to the other Parties as of the Signing Date, as of the Effective Date of this Agreement and as of the date of issuance of the Revised Business License of the Company:

z.	it is properly and validly founded and is validly existing under the laws of the jurisdiction where it is registered;

aa.	it has taken all action necessary under its jurisdiction of incorporation to authorize it to enter into this Agreement and its Annexes, and its representative whose signature is affixed hereto is fully authorized to sign this Agreement and its Annexes and to bind it;

bb.	upon the Effective Date this Agreement and its Annexes shall constitute its legal, valid and binding obligation as is set out therein; and

cc.	neither the execution of this Agreement, nor the performance of its obligations hereunder, will constitute a breach to any agreement, incorporation documents, law or regulations of its jurisdiction of incorporation .

6.2

Without prejudice to the representations and warranties set out in 0.1 of this Agreement , MicroPort and the Company additionally represent and warrant jointly and severally to Sorin, in the Knowledge that Sorin is entering into this Agreement in reliance on the accuracy of the representations and warranties as set out in 0.1 and Annex 5, that the representations and warranties set out in 0.1 and Annex 5 of MicroPort and the Company are in every aspect true and accurate, as of the Signing Date, as of the Effective Date and as of the date of issuance of the Revised Business License of the Company, irrespective of whether or not any deficiencies have already been known to Sorin with regard to the respective subject matter covered by any of the representations and warranties set out in 0.1 and Annex 5.

6.3	Each representation and warranty set out in 0.1 and Annex 5 shall be construed as an independent representation and warranty and shall not be limited by reference to or inference from any other terms of this Agreement or any other representations or warranties.

6.4	Each Party shall notify the other Parties immediately if the notifying Party becomes aware of a fact or circumstance which constitutes a breach of representations and warranties as set out in 0.1 and Annex 5, or has caused, or will or might cause, a representation or warranty under 0.1 and Annex 5 to become untrue, inaccurate, incomplete or misleading.

6.5	If any of the representations and warranties of MicroPort and the Company set out in 0.1 and Annex 5 should turn out to be false or incorrect, MicroPort and the Company shall be jointly and severally liable for immediately indemnifying and holding Sorin harmless from

---

---

6.6	If any of the representations and warranties of Sorin set out in 0.1should turn out to be false or incorrect, Sorin shall be liable for immediately indemnifying and holding MicroPort and the Company harmless from any damages, losses, expenses and all other disadvantages of any kind and nature which would not exist if such representation, warranty or guarantee were true or correct.

Article 7	Confidentiality

7.1

The Parties agree to keep the terms and conditions of this Agreement strictly confidential. The Agreement, its Annexes or the terms and conditions thereof will only be disclosed if and to the extent indispensably required to obtain all necessary consents, approvals and registrations which are a prerequisite for the effectiveness and performance of this Agreement. Public announcements and any information to third parties regarding Sorin's participation in the Company shall only be made upon mutual consent of the Parties.

7.2	0.1 shall not prevent disclosure by a Party to the extent it can demonstrate that:

dd.	Disclosure is required by law or by any stock exchange or any regulatory, governmental or antitrust body (including any tax authority) having applicable jurisdiction (provided that the disclosing Party shall first inform the other Party of its intention to disclose such information and take into account the reasonable comments of the other Party);

ee.	Disclosure is of information which was lawfully in the possession of that Party or any of its representatives (in either case as evidenced by written records) without any obligation of secrecy prior to its being received or held;

ff.	Disclosure is of information which has previously become publicly available other than through that Party's fault (or that of its representatives);

gg.	Disclosure is required for the purpose of any arbitral or judicial proceedings arising out of this Agreement.

Article 8	Effectiveness

8.1	This Agreement shall become effective upon fulfilment of the last of the following conditions precedent (“Effective Date”):

hh.	Signature of this Agreement and its Annexes by duly authorized representatives of the Parties;

ii.	Approval of this Agreement and its Annex 1 and 2 by the Company's board of directors and shareholder;

---

jj.	Approval of this Agreement and its Annex 1and 2 by the Approval Authority without changing their terms and conditions, unless the Parties have agreed thereto in writing.

---

8.2	MicroPort and the Company shall make their best efforts to ensure that the Company obtains all necessary approvals of this Agreement and its Annex 1 and 2 from the Approval Authority and immediately after its receipt forward copies thereof to Sorin.

8.3	Notwithstanding 0.1 and 0.2 above, Articles 5, 6, 7, 9, 10, 11and 12 shall become effective and binding upon the Parties upon signing this Agreement by all Parties.

Article 9	Termination

9.1	This Agreement may be terminated at any time by the written agreement of all Parties.

9.2	Further, this Agreement may unilaterally be terminated before the date of issuance of the Revised Business License of the Company by written notice to the other Party(ies) of an intention to terminate this Agreement pursuant to the procedure set forth below in 0.4:

kk.

by the non-defaulting Party, if any other Party or Parties materially breach this Agreement, in particular but without limitation to, breach any obligations, covenants, representations and/or warranties in Articles 4, 5, 6 and 7 and Annex 5, and no adequate remedy as required by the non-defaulting Party is provided by the other Party or Parties within one (1) month after written notice of the non-defaulting Party or other period as agreed by the concerned Parties;

ll.	By Sorin, in case of any change in the proprietary or management situation or financial position of the Company unless this belongs to the Ordinary Course of Business of the Company;

mm.	By any Party, if the Company or the other Party becomes bankrupt, or is the subject of proceedings for liquidation or dissolution, or ceases or is unable to carry on normal and usual business or becomes unable to pay its debts as they become due;

nn.	By any Party, if any governmental authority having authority over this Agreement or either Party requires any provision of this Agreement , the Joint Venture Contract and the Revised Articles of Association to be revised in such a way as to cause significant adverse consequences to the Company, or to such Party's original

oo.	By Sorin, if any governmental authority expropriates or requisites all or portion of the assets or properties of the Company, and such expropriation or requisition is considered by Sorin as adversely influencing the normal operation of the Company;

pp.	By Sorin, if any event or circumstance occurs which may cause Material Adverse Effect.

---

9.3	Either Party may further terminate this Agreement in case statutory laws or regulations permit such termination or in case the Joint Venture Contract terminates not due to a reason attributable to such terminating Party.

9.4

In the event that any Party gives notice to the other Parties pursuant to 0.2 ii) to vi) or 0.3 above of a desire to terminate this Agreement, the Parties shall immediately conduct negotiations and endeavour to resolve the situation. In the event matters are not resolved to the satisfaction of the notifying Party within one (1) month of issuance of such notice or a notified Party refuses to commence negotiations or performance within this period, the notifying Party shall be entitled to terminate this Agreement by issuing a written termination notice to the other Parties.

9.5	If any of the following conditions is not fulfilled within six (6) months from the Signing Date, unless it is otherwise agreed by the Parties, either Sorin or MicroPort may, irrespective of any of its other rights, terminate this Agreement by written notice to the other Parties at any time after expiry of the period.

qq.	Written approval of this Agreement by the Approval Authority without varying the terms or conditions of this Agreement or imposing any additional terms or conditions, unless explicitly consented to by Sorin and MicroPort in writing;

rr.	Written approval of the Joint Venture Contract attached as Annex 1 and/or Revised Articles of Association of the Company attached as Annex 2 by the Approval Authority without varying the terms or conditions thereof or imposing any additional terms or conditions, unless explicitly consented to by Sorin and MicroPort in writing;

ss.	Issuance of the approval reply and the approval certificate of the Company by the Approval Authority confirming its approval of the transaction under this Agreement (provided that the original of the approval reply and approval certificate have been shown to the Parties and the Parties have been permitted to make a copy);

tt.	Registration of the Revised Articles of Association of the Company attached as Annex 2 by the AIC without varying the terms or conditions thereof or or imposing an additional terms or conditions, unless explicitly consented to by Sorin and MicroPort in writing; additional terms or conditions, unless explicitly consented to by Sorin and MicroPort in writing;

uu.	Issuance of the Revised Business License of the Company by the AIC (provided that the original of the Revised Business License and its duplicate (“fu ben”) have been shown to the Parties and the Parties have been permitted to make a copy).

9.6	For the purpose of this 0, the “date of termination” shall be:

---

vv.	The date of the termination of this Agreement by common consent of the Parties, if the termination is effected pursuant to 0.1 above; and

ww.	The thirtieth (30th) day after the date when notice of unilateral termination of this Agreement by any Party is issued if the termination is effected pursuant to 0.4 or 0.5 above.

---

9.7

Without prejudice to any other claims or remedies that may be available to a Party, if this Agreement is terminated before the date of issuance of the Revised Business License, unless this Agreement and the Joint Venture Contract provide otherwise, the Parties shall be under no obligation to make any contribution to the Increased Registered Capital. The Parties shall take all necessary measures to cease the procedures of application to the Approval Authority and/or AIC for approval and/or registration of this Agreement and its Annexes immediately if such approval and/or the Revised Business License have not yet been issued. If the approval and/or the Revised Business License have been issued, the Parties shall take all necessary measures to cause the Approval Authority and/or AIC to revoke/cancel the approval/registration and rewind the transaction contemplated hereunder.

9.8	The obligations and benefits stipulated in the confidentiality provisions of 0 and in the provisions on settlement of disputes of 0 shall survive the termination or expiry of this Agreement.

Article 10	Liabilities for Breach

10.1

If any Party breaches its undertakings and warranties hereof, or fails to perform its obligations pursuant to this Agreement , or the declarations or representations made by it are false, incomplete or misleading, such Party shall be deemed to be in breach of this Agreement. The defaulting Party shall indemnify the non-defaulting Party, or the Company, as the case may be, for all actual losses suffered by the non-defaulting Party due to such default.

10.2

Notwithstanding Article 10.1, the termination rights under Article 9 shall be in addition to and not in substitution of any claims or remedies that may be available to the non­ defaulting Party and any termination shall neither relieve the defaulting Party or Parties from Liabilities accrued to the date of termination nor relieve the defaulting Party or Parties from Liabilities against the non-defaulting Party due to its default.

Article 11	Settlement of Disputes

11.1	In the event any dispute arises between the Parties out of or in relation to this Agreement, including any dispute regarding its breach, termination or validity, the Parties shall attempt in the first instance to resolve such dispute through friendly consultations.

11.2	If the dispute has not been resolved by friendly consultations within sixty (60) calendar days after one Party has served written notice to the other Parties requesting the commencement of such consultations, then any concerned Party may demand that the dispute be finally settled by arbitration under the Rules of the Hong Kong International Arbitration Centre in

---

yy.	The place of arbitration shall be Hong Kong;

zz.	The arbitral proceedings shall be kept confidential, unless the disclosure is required in accordance with relevant laws and regulations. The language of the arbitral proceedings shall be English and the Chinese translation shall be provided at the costs for the Party who requires such translation;

[[.	in any arbitration proceedings, any legal proceedings to enforce any arbitration award and in any other legal proceedings between the Parties pursuant to or relating to this Agreement, each Party expressly waives the defence of sovereign immunity and any other defence based on the fact or allegation that it is an agency or instrumentality of a sovereign state or is otherwise entitled to immunity;

aaa.	The tribunal shall consist of three (3) arbitrators;

bbb.	The presiding arbitrator shall neither be an Italian nor a Chinese national;

ccc.	The Parties hereby agree that any arbitration award rendered in accordance with this Article shall be final and binding upon the concerned Parties, and the Parties further agree that such award may be enforced by any court having jurisdiction over the Party against which the award has been rendered or over the assets of such Party wherever the same may be located; and

ddd.	After submittal of the dispute to arbitration, the Parties shall continue to exercise any other rights and perform any other obligations hereunder, unless such obligations are directly related to the matter under dispute.

Article 12	Notice

---

---

Article 13	Miscellaneous

13.1	To the extent permitted by Chinese law, failure or delay on the part of any Party hereto to exercise a right, power or privilege under this Agreement and the Annexes hereto shall not operate as a waiver thereof , nor shall any single or partial exercise of a right, power or privilege preclude any other future exercise thereof, unless explicitly otherwise regulated herein.

---

13.2	This Agreement and the rights and obligations of the Parties hereunder shall be construed and interpreted in accordance with the laws of the PRC. If there are no relevant Chinese laws, then the principles of the international commercial practice shall be applied.

13.3	All costs, expenses and public charges for obtaining the approval of this Agreement and its Annexes and duly registration thereof shall be borne by the Company. The costs of the Evaluation Report (Annex 4) shall be equally shared by MicroPort and Sorin.

---

13.5	No party shall be entitled to assign, pledge or transfer any of its rights under or deriving from this Agreement and/or its Annexes unless agreed by the other Parties in writing in advance.

13.6	Annex 1 up to and including Annex 5 shall form integral parts of this Agreement.

13.7

This Agreement and its Annexes shall be written in English and in Chinese being acknowledged by the Parties that both versions are consistent in all respects and are equally authentic. It is signed in eight (8) originals in each version and each of the Parties shall keep one (1) original of each version while the other originals shall be submitted to the relevant authorities as contemplated herein.

---

---

---

---

I.	Introduction

II.	Overview of the Entrusting Party and the Appraised Company

---

---

III.	The purpose of the appraisal

IV.	Target and scope of the appraisal

---

---

---

---

---

---

---

---

---

(I)	Since the appraisal objective implementation date and the appraisal base date

---

---

---

---

---

1	Capitalization

(a)	The registered capital of the Company has been fully paid in by MicroPort and is available for and at the disposal of the Company.

(b)

There is no existing option, warrant, call, right or contract to which MicroPort or the Company is a party requiring, and there are no securities of the Company outstanding which upon conversion or exchange would require, the issuance, sale or transfer of any additional equity interest of the Company or other securities convertible into, exchangeable for or evidencing the right to subscribe for or purchase any equity interest of the Company. There are no voting trusts, irrevocable proxies or other contracts or understandings to which the Company or MicroPort is a party or is bound with respect to the voting or consent of any equity interest in the Company.

2	Subsidiary and Branch

3	Corporate Records

4	Operation

5	No Liabilities

---

6	Labour

7	Litigation Relating to the Company

8	Compliance with Laws; Permits

(a)	The Company is in compliance in all material respects with all applicable laws.

(b)

The Company currently has all valid permits, licenses and registrations which are required for the operation of its businesses as presently conducted and as currently proposed to be conducted. The Company is not in default or violation, and no event has occurred which, with notice or the lapse of time or both, would constitute a default or violation, of any term, condition or provision of any such permits and registrations.

9	Full Disclosure

---

(1)	The European Investment Bank, having its seat at 100 blvd Konrad Adenauer, Luxembourg, L-2950 Luxembourg (the “Bank”);

(2)	Sorin S.p.A., a company incorporated in Italy having its registered office at Via Benigno Crespi, 17, 20159 Milano, Italy (the “Italian Holdco”);

(3)	Sorin CRM S.A.S., a company incorporated in France having its registered office at 4 Avenue Reaumur, 92140 Clamart Cedex – France (the “French Subsidiary”);

(4)	Sorin Group Italia S.r.l., a company incorporated in Italy, having its registered office at Via Benigno Crespi, 17, 20159 Milano, Italy (the “Italian Subsidiary”); and

(5)	LivaNova PLC, a public limited company incorporated in England and Wales with registered number 9451374, having its registered office at c/o Legalinx Limited, 1 Fetter Lane, London EC4A lBR, United Kingdom (the “UK Holdco”).

(A)	The Italian Holdco, the French Subsidiary, the Italian Subsidiary and the Bank entered into a research and development finance contract dated 6 May 2014 (the “Finance Contract”).

(B)	The Italian Holdco has entered into a transaction agreement dated 23 March 2015 with, among others, Cyberonics, Inc., a Delaware corporation listed on NASDAQ (“Cyberonics”) (the “Transaction Agreement”). Pursuant to the Transaction Agreement, it is expected that the Italian Holdco will merge with and into its wholly-owned subsidiary UK Holdco, with UK Holdco being the surviving entity.

(C)	The Italian Holdco, the French Subsidiary, the Italian Subsidiary and the Bank have agreed to enter into this agreement in order to amend the terms of the Finance Contact in the manner set out below.

(D)	The parties acknowledge that the purpose of the Finance Contact, being research and development activities in Italy and France for the 2014–2016 period, is not impacted by the transaction.

1.	INTERPRETATION

1.1	Definitions

1.2	Construction

(a)	Terms defined in the Finance Contract (as amended and restated pursuant to this Agreement) shall have the same meaning when used in this Agreement.

(b)	In this Agreement, references to:

(i)	Clauses and Schedules are, save if explicitly stipulated otherwise, references respectively to clauses of, and recitals and schedules to this Agreement;

(ii)	A provision of law are references to that provision as amended or re-enacted; and

(iii)	Any other agreement or instrument are references to that other agreement or instrument as amended, novated, supplemented, extended or restated.

1.3	Third Party Rights

2.	AMENDMENT AND RESTATEMENT OF THE FINANCE CONTRACT

2.1	The Finance Contract

2.2	Continuing Effect

2.3	Further Assurance

3.	GUARANTOR CONFIRMATION

3.1	Guarantee Confirmation

(a)	Continue to apply in respect of the obligations of each Co-debtor under the amended and restated Finance Contract; and

(b)	Extend to all new obligations of any Co-debtor under the amended and restated Finance Contract arising from the amendments effected by this Agreement, subject only to the guarantee limitations set out in Article 7.011 (Limitation of the Obligations of the French Subsidiary) of the amended and restated Finance Contract.

3.2	Changes to the parties of the Finance Contract

(a)	As a result of and with effect from the completion of the Merger, UK Holdco shall by operation of law assume all of the rights and obligations of Italian Holdco, including those under the original Finance Contract.

(b)	With effect from (and including) the Effective Date, and subject to the completion of the Merger, UK Holdco agrees to be a party to the amended and restated Finance Contract as the “Parent” and to be bound by the obligations expressed to be performed by the “Parent” thereunder.

4.	REPRESENTATIONS AND WARRANTIES

(a)	the date of this Agreement, provided that any reference in Article 6.15 (General Representations and Warranties) of the amended and restated Finance Contract to “this Contract” shall be read as though it were a reference to this Agreement; and

(b)	the Effective Date.

5.	FEES AND EXPENSES

5.1	Costs and Expenses

(a)	Each Company shall pay promptly on demand to the Bank the amount of all charges and expenses, including professional, banking or exchange charges incurred by the Bank in connection with the preparation, execution, implementation, enforcement and termination of this Agreement or any related document and any amendment, supplement or waiver in respect of this Agreement or any related document.

(b)	Each Company shall pay all Taxes, duties, fees and other impositions of whatsoever nature, including stamp duty and registration fees, arising out of the execution or implementation of this Agreement.

5.2	Amendment Fee

6.	MISCELLANEOUS

(a)	the legality, validity or enforceability in that jurisdiction of any other term of this Agreement or the effectiveness in any other respect of this Agreement in that jurisdiction; or

(b)	the legality, validity or enforceability in other jurisdictions of that or any other term of this Agreement or the effectiveness of this Agreement under the laws of such other jurisdictions.

6.3	Remedies and Waivers

7.	GOVERNING LAW AND JURISDICTION

7.1	Governing Law

7.2	Jurisdiction

(a)	The courts of England have exclusive jurisdiction to settle any dispute (a “Dispute”) arising out of or in connection with this Agreement (including a dispute regarding the existence, validity or termination of this Agreement or the consequences of its nullity) or any non-contractual obligation arising out of or in connection with this Agreement.

(b)	The parties agree that the courts of England are the most appropriate and convenient courts to settle Disputes between them and, accordingly, that they will not argue to the contrary.

7.3	Agent of Service

1)	Companies

a)	A copy of the constitutional documents of each Company or a certificate of an authorised signatory of each relevant Company certifying that the constitutional documents previously delivered to the Bank for the purposes of the original Finance Contract have not been amended and remain in full force and effect.

b)	A copy of the relevant authority of signatories of each Company, including a resolution of the board of directors, or any other competent corporate authority, of each of UK Holdco, the French Subsidiary and the Italian Subsidiary:

i.	approving the terms of, and the transactions contemplated by, this Agreement and resolving that it execute this Agreement;

ii.	authorising a specified person or persons to execute this Agreement on its behalf; and

iii.	in the case of a Company other than UK Holdco, authorising UK Holdco to act as its agent in connection with this Agreement.

c)	If applicable, a copy of any power of attorney authorising the person or persons specified therein to sign this Agreement to which it is a party.

d)	A specimen of the signature of each person authorised by the resolution referred to in paragraph (b) above and, if applicable, any power of attorney referred to in paragraph (c).

e)	A certificate of an authorised signatory of the relevant Company certifying that each copy document relating to it specified in this Schedule 1 is correct, complete and in full force and effect as at a date no earlier than the date of this Agreement.

2)	Amendment agreement

3)	Legal Opinions

4)	Merger

a)	Copy of the Transaction Agreement executed by the parties to that document.

b)	A certificate of UK Holdco (signed by a director) certifying that:

i.	The Merger has become effective (attaching supporting evidence including a copy of the order given by the High Court of England and Wales sanctioning the Merger).

ii.	each of the matters specified in sections 6.01 and 6.02 of the Transaction Agreement relating to the Merger have been satisfied or, with the consent of the Bank, waived, except for any waiver which is not materially adverse to the interests of the Bank;

iii.	the Transaction Agreement has not been amended, varied, novated, supplemented, superseded, waived or terminated in a way which is materially adverse to the interests of the Bank, except with the consent of the Bank; and

iv.	UK Holdco is not aware of any material breach of any warranty or any material claim under the Transaction Agreement.

5)	Other documents or evidence

(1)

The Borrowers have stated that they are undertaking a project of research and development (R&D) related to various new products and product improvements in heart failure (cardiovascular diseases) with _ a particular focus on (i) cardiac surgery (heart valves and cardiopulmonary), (ii) cardiac rhythm management and (iii) new ventures (innovative medical devices related to heart failure). The project covers the entire product development from pre-clinical studies up to clinical trials for the period 2014- 2016. The project will be carried out in Italy (43%) and France (57%), as more particularly described in the technical description (the “Technical Description”) set out in Schedule A (the “Project”).

(2)	The total cost of the Project, as estimated by the Bank, is EUR 286,200,000.00 (two hundred eighty six million two hundred thousand euros) and the Borrowers stated that they intend to finance the Project as follows :

(3)	In order to fulfil the financing plan set out in Recital (2), the Borrowers have requested from the Bank a credit of EUR 100,000,000.00 (one hundred million euros).

(4)

The Bank, considering that the financing of the Project falls within the scope of its functions, and having regard to the statements and facts cited in these Recitals, has decided to give effect to the Borrowers' request providing to them a credit in an amount of EUR 100,000,000.00 (one hundred million euros) under this Finance Contract (the ‘Contract” provided that the amount of the Bank loan shall not, in any case, exceed 50% (fifty percent) of the total cost of the Project set out in Recital (2).

(5)	The Borrowers have authorised the borrowing of the sum of EUR 100,000,000.00 (one hundred million euros) represented by this credit on the terms and conditions set out in this Contract.

(6)	The Statute of the Bank provides that the Bank shall ensure that its funds are used as rationally as possible in the interests of the European Union; and, accordingly, the terms and conditions of the Bank's loan operations must be consistent with relevant policies of the European Union.

(7)	The Bank considers that access to information plays an essential role in the reduction of environmental and social risks, including human rights violations, linked to the projects it finances and has therefore established its Transparency policy, the purpose of which is to enhance the accountability of the EIB Group towards its stakeholders and the citizens of the European Union in general.

(8)	The processing of personal data shall be carried out by the Bank in accordance with applicable European Union legislation on the protection of individuals with regard to the processing of personal data by the EC institutions and bodies and on the free movement of such data.

(a)	Interpretation

(i)	References to Articles, Recitals, Schedules and Annexes are, save if explicitly stipulated otherwise, references respectively to articles of, and recitals, schedules and annexes to this Contract.

(ii)	References to a provision of law are references to that provision as amended or re­ enacted.

(iii)	References to any other agreement or instrument are references to that other agreement or instrument as amended, novated, supplemented, extended or restated.

(a)	16h00 Luxembourg time on the day of delivery, if the notice is delivered by 14h00 Luxembourg time on a Business Day; or

(b)	11h00 Luxembourg time on the next following day which is a Business Day, if the notice is delivered after 14h00 Luxembourg time on any such day or is delivered on a day which is not a Business Day.

(i)	the net revenues (ricavi netfl) of the Group;

(ii)	plus other revenues and income (altri ricavi e provent . change in inventory of work in progress, semifinished goods and finished goods (variazione rimanenze prodotti in lavorazione, semilavorauve finit1) and increase in Borrower-produced additions to non­ current assets (incremento di immobilizzazioni per lavori interm);

(iii)	minus cost of raw material and other materials (costi per materie prime ed altri materiali), cost of services used (costi per servizi), personnel expenses (costi per il personale) and miscellaneous operating costs (altri costi di funzionamento).

(i)	the aggregate at that time of Financial Indebtedness of the members of the Group from sources external to the Group (including guarantees for an aggregate amount exceeding Euro 30,000,000.00 (thirty million euros), or following, and subject to, Completion, USO 33,000,000.00 (thirty-three million US dollars) at that times); less

(ii)

the aggregate amount at that time of: (aa) cash; (bb) debt securities issued or guaranteed by any member state of the OECO; (cc) debt securities issued by leading entities and listed on national stock exchanges of any member of the European Union; (dd) receivables from derivative financial instruments; and (ee) deposits or notes purchased in respect of the credit enhancements of securitisation programmes up to an aggregate amount not exceeding Euro 30,000,000.00 (thirty million euros), or following, and subject to, Completion, USO 33,000,000.00 (thirty-three million US dollars) for each financial year.

(i)	interest accrued during such period as an obligation of any member of the Group (whether or not paid or capitalised during or deferred for payment after such period);

(ii)	less any interest received or receivable by any member of the Group (after deducting any applicable withholding tax) in such period.

•	the interest rate net of the Margin that would have been applicable to such amount had it been disbursed to the Borrowers on the Scheduled Disbursement Date

•	EURIBOR (one month rate) less 0.125% (12.5 basis points), unless this value is less than zero, in which case it will be set at zero.

(a)	a material disruption to those payment or communications systems or to those financial markets which are, in each case, required to operate in order for payments to be made in connection with this Contract; or

(b)	the occurrence of any other event which results in a disruption (of a technical or systems-related nature) to the treasury or payments operations of either the Bank or a Borrower, preventing that party:

(i)	from performing its payment obligations under this Contract; or

(ii)	from communicating with other parties,

(a)	fauna and flora;

(b)	soil, water, air, climate and the landscape; and

(c)	cultural heritage and the built environment,

(a)	EU law, including principles and standards;

(b)	national laws and regulations; and

(c)	applicable international treaties of which a principal objective is the preservation, protection or improvement of the Environment.

(i)	moneys borrowed;

(ii)	any amount raised by acceptance under any acceptance credit facility or dematerialised equivalent;

(iii)	any amount raised pursuant to any note purchase facility or the issue of bonds, notes, debentures, loan stock or any similar instrument;

(iv)	the amount of any liability in respect of any lease or hire purchase contract which would, in accordance with GAAP, be treated as a finance or capital lease;

(v)	receivables sold or discounted (other than any receivables to the extent they are sold on a non-recourse basis - including true sale IFRS - under an arrangement other than a Permitted Receivables Disposal);

(vi)	any amount raised under any other transaction (including any forward sale or purchase agreement, sale and lease back arrangements and sale and purchase arrangements having deferred payment terms longer than terms customary on the market) having the financial effect of a borrowing;

(vii)	any derivative transaction entered into in connection with protection against or benefit from fluctuation in any rate or price (and, when calculating the value of any derivative transaction, only the marked to market value (fair value) shall be taken into account);

(viii)	any counter-indemnity obligation in respect of a guarantee, indemnity, bond, standby or documentary letter of credit or any other instrument issued by a bank or financial institution; and

(ix)	the amount of any liability in respect of any guarantee or indemnity for any of the items referred to in paragraphs (i) to (viii) above.

(a)	there are, in the reasonable opinion of the Bank, events or circumstances adversely affecting the Bank's access to its sources of funding;

(b)	in the opinion of the Bank, funds are not available from its ordinary sources of funding in order to adequately fund a Tranche in the relevant currency and/or for the relevant maturity and/or in relation to the reimbursement profile of such Tranche;

(c)	in relation to a Tranche in respect of which interest is or would be payable at Floating Rate:

(A)	the cost to the Bank of obtaining funds from its sources of funding, as determined by the Bank, for a period equal to the Floating Rate Reference Period of such Tranche (i.e. in the money market) would be in excess of the applicable EURIBOR;

(B)	the Bank determines that adequate and fair means do not exist for ascertaining the applicable EURIBOR of such Tranche or it is not possible to determine the EURIBOR in accordance with the definition contained in Schedule B.

(a)	for a Fixed Rate Tranche, the following Relevant Business Day, without adjustment to the interest due under Article 3.01; and

(b)	for a Floating Rate Tranche, the next day, if any, of that calendar month that is a Relevant Business Day or, failing that, the nearest preceding day that is a Relevant Business Day, in all cases with corresponding adjustment to the interest due under Article 3.01.

(a)	the interest net of the Margin that would accrue thereafter on the Prepayment Amount over the period from the Prepayment Date to the Maturity Date if it were not prepaid; over

(b)	the interest that would so accrue over that period, if it were calculated at the Redeployment Rate, less 0.15% (fifteen basis points).

(a)	which is controlled, directly or indirectly, by the first mentioned company or corporation;

(b)	more than half the issued share capital (which gives rise to voting rights) of which is beneficially owned, directly or indirectly by the first mentioned company or corporation;

(c)	which is a Subsidiary of another Subsidiary of the first mentioned company or corporation,

(a)	Each of the Borrowers may present to the Bank a Disbursement Request for the disbursement of a Tranche, such Disbursement Request to be received at the latest 15 (fifteen) days before the Final Availability Date. The Disbursement Request shall be in the form set out in Schedule C and shall specify:

(i)	the amount of the Tranche

(ii)

the preferred disbursement date for the Tranche; such preferred disbursement date must be a Relevant Business Day falling at least 15 (fifteen) days after the date of the Disbursement Request and, in any event, on or before the Final Availability Date, it being understood that notwithstanding the Final Availability Date the Bank may disburse the Tranche up to 4 (four) calendar months from the date of the Disbursement Request;

(iii)	whether the Tranche is a Fixed Rate Tranche or a Floating Rate Tranche, each pursuant to the relevant provisions of Article 3.01;

(iv)	the preferred interest payment periodicity for the Tranche, chosen in accordance with Article 3.01;

(v)	the preferred terms for repayment of principal for the Tranche, chosen in accordance with Article 4.01;

(vi)	the preferred first and last dates for repayment of principal for the Tranche; and

(vii)	the IBAN code (or appropriate format in line with local banking practice) and SWIFT BIC of the bank account to which disbursement of the Tranche should be made in accordance with Article 1.02D.

(b)	If the Bank, following a request by any of the Borrowers, has provided that Borrower, before the submission of the Disbursement Request, with a non-binding fixed interest rate or spread quotation to be applicable to the Tranche, that Borrower may also at its discretion specify in the Disbursement Request such quotation, that is to say:

(i)	in the case of a Fixed Rate Tranche, the aforementioned fixed interest rate previously quoted by the Bank; or

(ii)	in the case of a Floating Rate Tranche, the aforementioned spread previously quoted by the Bank,

(c)	Each Disbursement Request shall be accompanied by evidence of the authority of the person or persons authorised to sign it and the specimen signature of such person or persons or a declaration by the relevant Borrower that no change has occurred in relation to the authority of the person or persons authorised to sign Disbursement Requests under this Contract.

(d)	Subject to Article 1.02C(b), each Disbursement Request is irrevocable.

(a)	Not less than 10 (ten) days before the proposed Scheduled Disbursement Date of a Tranche the Bank shall, if the Disbursement Request conforms to this Article 1.02, deliver to the relevant Borrower a Disbursement Notice which shall specify:

(i)	the amount of the Tranche;

(ii)	the Scheduled Disbursement Date;

(iii)	the interest rate basis for the Tranche, being: (i) a Fixed Rate Tranche; or (ii) a Floating Rate Tranche all pursuant to the relevant provisions of Article 3.01;

(iv)	the first interest Payment Date and the periodicity for the payment of interest for the Tranche;

(v)	the terms for repayment of principal for the Tranche;

(vi)	the first and last dates for repayment of principal for the Tranche;

(vii)	the applicable Payment Dates for the Tranche; and

(viii)	for a Fixed Rate Tranche the Fixed Rate and for a Floating Rate Tranche the Spread applicable to the Tranche until the Maturity Date

(b)

If one or more of the elements specified in the Disbursement Notice does not reflect the corresponding element, if any, in the Disbursement Request, the relevant Borrower may following receipt of the Disbursement Notice revoke the Disbursement Request by written notice to the Bank to be received no later than 12h00 Luxembourg time on the next Business Day and thereupon the Disbursement Request and the Disbursement Notice shall be of no effect. If the relevant Borrower have not revoked in writing the Disbursement Request within such period, such Borrower will be deemed to have accepted all elements specified in the Disbursement Notice.

(c)	If the relevant Borrower has presented to the Bank a Disbursement Request in which such Borrower has not specified the fixed interest rate or spread as set out in Article 1.02B(b), such Borrower will be deemed to have agreed in advance to the Fixed Rate or Spread as subsequently specified in the Disbursement Notice.

(a)	evidence that the execution of this Contract by the Borrowers have been duly authorised and that the person or persons signing this Contract on behalf of each of the Borrowers is/are duly authorised to do so together with the specimen signature of each such person or persons;

(b)	evidence that the Borrowers have obtained all necessary Authorisations, required in connection with this Contract and the Project;

(c)	legal opinions issued by the external legal counsel of the Borrowers (at the cost of the Borrowers) on (i) the due incorporation, capacity and corporate authorizations of each of the Borrowers; and (ii) on the legal, valid, binding and enforceable obligations by each of the Borrowers under this Contract in accordance with their respective law of their jurisdiction of incorporation;

(d)	legal memorandum by the external legal counsel of the Borrowers (at the cost of the Borrowers) on the execution of this Contract by the French Subsidiary as Co-debtor;

(e)	evidence that any process agent referred to in Article 11.03 has accepted its appointment;

(f)	evidence of compliance by the relevant Borrower with the financial covenants pursuant to Article 6.07;

(g)	evidence of payment of the appraisal fee in full pursuant to Article 1.08; and

(h)	evidence that the Parent has repaid in full the loans, together with accrued interest, and all other amounts accrued or outstanding, under the Finance Contract between the Bank and the Parent in Milan on 6 December 2007 (Fl N° 24.239(1T) Serapis N 2004-0233) denominated “Sorin Tecnologie Medicali R & D”.

1.04B	All Tranches

(a)	that the Bank has received, in form and substance satisfactory to it, on or before the date falling 5 (five) Business Days before the Scheduled Disbursement Date for the proposed Tranche, of the following documents or evidence:

(i)	a certificate from the Borrower in the form of Schedule D.1, signed by an authorised representative of the Borrower and dated no earlier than the date falling 15 (fifteen) days before the Scheduled Disbursement Date;

(ii)	a copy of any other authorisation or other document, opinion or assurance which the Bank has notified the Parent is necessary or desirable in connection with the entry into and performance of, and the transactions contemplated by, this Contract or the validity and enforceability of the same.

(b)	that on the Disbursement Date for the proposed Tranche:

(i)	the representations and warranties which are repeated pursuant to Article 6.15 are correct in all material respects; and

(ii)	no event or circumstance which constitutes or would with the passage of time or giving of notice under this Contract constitute:

1.05A	Grounds for deferment

1.05B	Cancellation of a disbursement deferred by 6 (six) months

1.06	Cancellation and suspension

1.06A	Borrower’s right to cancel.

1.06B	Bank's right to suspend and cancel

(a)	The Bank may, by notice in writing to the Parent, on behalf of the Borrowers, suspend and/or cancel the undisbursed portion of the Credit in whole or in part at any time and with immediate effect

(i)	upon the occurrence of a Prepayment Event or an Event of Default or an event or circumstance which would with the passage of time or giving of notice under this Contract constitute a Prepayment Event or an Event of Default; or

(ii)	if a Material Adverse Change occurs.

(b)	Any suspension shall continue until the Bank ends the suspension or cancels the suspended amount.

1.06C	Indemnity for suspension and cancellation of a Tranche

1.06C(1)	SUSPENSION

1.06C(2)	CANCELLATION

(a)	a Fixed Rate Tranche which is a Notified Tranche, it shall indemnify the Bank under Article 4.028;

(b)	a Floating Rate Notified Tranche or any part of the Credit other than a Notified Tranche, no indemnity is payable.

(i)	a Fixed Rate Tranche which is a Notified Tranche upon an lndemnifiable Prepayment Event or pursuant to Article 1.05B, the relevant Borrower shall pay to the Bank the Prepayment Indemnity; or

(ii)	a Notified Tranche upon an Event of Default, the relevant Borrower shall indemnify the Bank under Article 10.03.

(a)	on each 1 June, 1 September, 1 December and 1 March of each year; and

(b)	on the Final Availability Date; or, if the Credit is cancelled in full under Article 1.06 prior to the Final Availability Date, on the date of cancellation.

(i)	for overdue sums related to Floating Rate Tranches, the applicable Floating Rate plus 2% (200 basis points);

(ii)	for overdue sums related to Fixed Rate Tranches, the higher of (a) the applicable Fixed Rate plus 2% (200 basis points) or (b) the EURIBOR plus 2% (200 basis points);

(iii)	for overdue sums other than under (i) or (ii) above, the EURIBOR plus 2% (200 basis points) and shall be payable in accordance with the demand of the Bank. For the purpose of determining the EURIBOR in relation to this Article 3.02, the relevant periods within the meaning of Schedule B shall be successive periods of one month commencing on the due date.

•	the Margin and

•

the rate (expressed as a percentage rate per annum) which is determined by the Bank to be the all-inclusive cost to the Bank for the funding of the relevant Tranche based upon the then applicable internally generated Bank reference rate or an alternative rate determination method reasonably determined by the Bank. The Borrower shall have the right to refuse in writing such disbursement within the deadline specified in the notification and shall bear charges incurred as a result, if any, in which case the Bank shall not make the disbursement and the corresponding Credit shall remain available for disbursement under Article 1.02B. If the Borrower does not refuse the disbursement in time, the parties agree that the disbursement and the conditions thereof shall be fully binding for both parties.

(a)	Each Borrower shall repay each Tranche by instalments on the Payment Dates specified in the relevant Disbursement Notice in accordance with the terms of the amortisation table delivered pursuant to Article 2.03.

(b)	Each amortisation table shall be drawn up on the basis that:

(i)	in the case of a Fixed Rate Tranche, repayment shall be made annually, semi­ annually or quarterly by equal instalments of principal or constant instalments of principal and interest;

(ii)	in the case of a Floating Rate Tranche, repayment shall be made by equal annual, semi-annual or quarterly instalments of principal;

(iii)	the first repayment date of each Tranche shall be a Payment Date falling not earlier than 60 (sixty) days from the Scheduled Disbursement Date and not later than the first Payment Date immediately following the first anniversary of the Scheduled Disbursement Date of the Tranche; and

(iv)	the last repayment date of each Tranche shall be a Payment Date falling not earlier than 4 (four) years and not later than 7 (seven) years from the Scheduled Disbursement Date.

•	such prepayment is not made within a revolving credit facility (save for the cancellation of the revolving credit facility);

•	such prepayment is not made out of the proceeds of a loan or other indebtedness having a term at least equal to the unexpired terms of the Non-EIB Financing prepaid,

(a)	a “Change-of-Control Event” occurs if:

(i)	any person or group of persons acting in concert gains control of the Parent or of the entity directly or ultimately controlling the Parent;

(ii)	the Parent ceases to be the beneficial owner directly or indirectly through wholly owned subsidiaries of more than 50% (fifty per cent) of the issued share capital of the French Subsidiary; or

(iii)	the Parent ceases to be the beneficial owner directly or indirectly through wholly owned subsidiaries of more than 50% (fifty per cent) of the issued share capital of the Italian Subsidiary;

(b)	“acting in concert” means acting together pursuant to an agreement or understanding (whether formal or informal); and

(c)	“control” means the power to direct the management and policies of an entity, whether through the ownership of voting capital, by contract or otherwise.

(a)	in respect of interest and indemnities due under a Fixed Rate Tranche, a year of 360 (three hundred and sixty) days and a month of 30 (thirty) days;

(b)	in respect of interest and indemnities due under a Floating Rate Tranche, a year of 360 (three hundred and sixty) days and the number of days elapsed;

(c)	in respect of fees, a year of 360 (three hundred and sixty) days and the number of days elapsed.

(a)	the Bank may, and shall if requested to do so by the Parent, consult with the Parent on behalf of the Borrowers with a view to agreeing with the Parent on behalf of the Borrowers such changes to the operation or administration of this Contract as the Bank may deem necessary in the circumstances;

(b)	the Bank shall not be obliged to consult with the Parent in relation to any changes mentioned in paragraph (a) if, in its opinion, it is not practicable to do so in the circumstances and, in any event, shall have no obligation to agree to such changes; and

(c)	the Bank shall not be liable for any damages, costs or losses whatsoever arising as a result of a Disruption Event or for taking or not taking any action pursuant to or in connection with this Article 5.04.

(a)	General

(b)	Partial payments

(i)	first, in or towards payment pro rata of any unpaid fees, costs, indemnities and expenses due under this Contract;

(ii)	secondly, in or towards payment of any accrued interest due but unpaid under this Contract;

(iii)	thirdly, in or towards payment of any principal due but unpaid under this Contract; and

(iv)	fourthly, in or towards payment of any other sum due but unpaid under this Contract.

(c)	Allocation of sums related to Tranches

(i)	In case of:

•	a partial voluntary prepayment of a Tranche, the Prepayment Amount shall be applied pro rata to each outstanding instalment, or, at the request of the Borrower, in inverse order of maturity,

•	a partial compulsory prepayment of a Tranche, the Prepayment Amount shall be applied in reduction of the outstanding instalments in inverse order of maturity.

(ii)	Sums received by the Bank following a demand under Article 10.01 and applied to a Tranche, shall reduce the outstanding instalments in inverse order of maturity. The Bank may apply sums received between Tranches at its discretion.

(iii)	In case of receipt of sums which cannot be identified as applicable to a specific Tranche, and on which there is no agreement between the Bank and the Parent on behalf of the Borrowers on their application, the Bank may apply these between Tranches at its discretion.

A.	Project undertakings

(a)	Maintenance: maintain, repair, overhaul and renew all property forming part of the Project as required to keep it in good working order;

(b)

Project assets: unless the Bank shall have given its prior consent in writing retain title to and possession of all or substantially all the assets comprising the Project or, as appropriate, replace and renew such assets and maintain the Project in substantially continuous operation in accordance with its original purpose; provided that the Bank may withhold its consent only where the proposed action would prejudice the Bank's interests as lender to the Borrowers or would render the Project ineligible for financing by the Bank under its Statute or under Article 309 of the Treaty on the Functioning of the European Union;

(c)	Insurance: insure all works and property forming part of the Project with first class insurance companies in accordance with the most comprehensive relevant industry practice;

(d)	Rights and Permits: maintain in force all rights of way or use and all Authorisations necessary for the execution and operation of the Project; and

(e)	Environment:

(f)

Integrity: take, within a reasonable timeframe, appropriate measures in respect of any member of its management bodies who has been convicted by a final and irrevocable court ruling of a Criminal Offence perpetrated in the course of the exercise of his/her professional duties, in order to ensure that such member is excluded from any of that Borrower's activity in relation to the Loan or the Project.

B	General undertakings

6.06A	Each Borrower shall not (and the Parent shall ensure that no other member of the Group will) enter into a single transaction or a series of transactions (whether related or not) and whether voluntary or involuntary to sell, lease, transfer or otherwise dispose of any asset.

6.06B	Paragraph 6.06A above does not apply to any sale, lease, transfer or other disposal for fair market value and at arm's length:

(a)	made in the ordinary course of trading of the disposing entity;

(b)	of assets in exchange of other assets comparable or superior as to type, value and quality;

(c)	of obsolete or redundant vehicles, plant and equipment for cash;

(d)	of receivables being part of Permitted Receivables Disposals; or

(e)	of assets not falling within paragraphs (a),(b), (c) and (d} above, provided that over the life of the Loan the aggregate value of the disposed asset and other disposals of assets not falling within paragraphs (a), (b), (c) and (d) above, shall not exceed 10 per cent of the total assets of the Group as reported in the latest audited consolidated financial statements.

6.06C	Notwithstanding anything to the contrary contained in this Article 6.06, each of the undertakings contained in this Article 6.06 are subject to all transactions contemplated under Article I (The Mergers) and Article II (Effect of the Merger on Capital Stock) of the Transaction Agreement.

6.08A	Except as permitted under paragraphs 6.088 and 6.08C below, no Borrower shall (and the Parent shall ensure that no member of the Group will):

(a)	declare, make or pay any dividend, charge, fee or other distribution (or interest on any unpaid dividend, charge, fee or other distribution) (whether in cash or in kind) on or in respect of its share capital (or any class of its share capital);

(b)	repay or distribute any dividend or share premium reserve;

(c)	pay or allow any member of the Group to pay any management, advisory or other fee to or to the order of any of the direct or indirect shareholders of the Parent (other than in respect of financial services rendered by any such shareholder in the ordinary course of its business to the Parent or a Subsidiary);

(d)	redeem, repurchase or repay any of its share capital or resolve to do so; or

(e)	reduce its share capital.

(i)	reduction of share capital when mandatorily required under articles 2446 or 2447 of the Italian civil code (or any other applicable provision of law) (provided that the share capital is simultaneously reinstated at an amount not lower than the minimum amount required by any applicable law); or

(ii)	the payment of a dividend to any of the Parent, the Italian Subsidiary, the French Subsidiary or any of their wholly-owned Subsidiaries.

6.08C	Notwithstanding paragraph A. above, the Parent may distribute dividends and/or redeem, repurchase or repay any of its share capital or resolve to do so if:

(a)	all payments by any Borrower under this Contract have been punctually made when due;

(b)	no Event of Default or Prepayment Event is continuing unremedied or unwaived; and

(c)	the Parent is in compliance with the financial covenants pursuant to Article 6.07.

6.08D	Notwithstanding anything to the contrary contained in this Article 6.08, each of the undertakings contained in this Article 6.08 are subject to all transactions contemplated under Article I (The Mergers) and Article II (Effect of the Merger on Capital Stock) of the Transaction Agreement.

6.09	Change of Business

6.10	Acquisition

6.10A	No Borrower shall (and the parent shall ensure that no other member of the Group will) acquire a company or any shares or securities or a business or undertaking (or, in each case, any interest in any of them).

6.10B	Paragraph 6.10A does not apply to acquisition for cash consideration of all or the majority of the issue share capital of a limited liability company but not only if:

(a)	no Event of Default is continuing on the closing date for the acquisition or would occur as a result of the acquisition;

(b)	the acquired company, business or undertaking is engaged in a business substantially the same as (or ancillary or related to) that carried on by the Group; and

(c)

the consideration (including associated costs and expenses) for the acquisition and any Financial Indebtedness or other assumed actual or contingent liability in each case remaining in the acquired company (or any such business) at the date of acquisition (the “Individual Purchase Price”) when aggregated with the consideration (including associated costs and expenses) for any other acquisition permitted under this Contract and any Financial Indebtedness or other assumed actual or contingent liability, in each case remaining in any such acquired companies or businesses at the time of acquisition (the “Total Purchase Price”) does not exceed in aggregate Euro 200,000,000.00 (two hundred million euros), or following, and subject to, Completion, USO 280,000,000.00 (two hundred and eighty million US dollars) or its equivalent over the life of the Tranches.

6.10C	Notwithstanding anything to the contrary contained in this Article 6.10, each of the undertakings contained in this Article 6.10 are subject to all transactions contemplated under Article I (The Mergers) and Article II (Effect of the Merger on Capital Stock) of the Transaction Agreement.

6.11	Financial Indebtedness

(a)	“Group Financial Indebtedness” means the Financial Indebtedness of the Group;

(b)	“Subsidiary Financial Indebtedness” means the aggregate Financial Indebtedness of each Subsidiary excluding the Financial Indebtedness of the Borrowers.

6.12	Compliance with laws

6.13	Merger

(a)	a merger between a Borrower and any Subsidiary that is consolidated within the consolidated financial statements of the Parent, provided that such Borrower is in each case the surviving entity;

(b)	any solvent amalgamation or merger among members of the Group which are not a Borrower;

(c)	the solvent liquidation or reorganisation of any member of the Group which is not a Borrower so long as any payments or assets distributed as a result of such liquidation or reorganisation are distributed to other members of the Group; and

(d)

the merger of Cypher Merger Sub Inc. with Cyberonics, Inc. in accordance with paragraph (a) of section 1.01 (The Mergers), section 1.02 (Closing Date), section 1.03 (Effective Times), section 1.04 (Organizational Documents; Directors and Officers), section 2.02 (Conversion of Securities in the Cyberonics Merger), section 2.05 (Exchange of Cyberonics Certificates; Payment for Cyberonics Shares) and section 2.06 (Treatment of Cyberonics Equity Awards) of the Transaction Agreement,

6.14	Books and records

6.15	General Representations and Warranties

6.15A	The Parent represents and warrants to the Bank that it is duly incorporated and validly existing as a public limited company under the laws of England and Wales and it has power to carry on its business as it is now being conducted and to own its property and other assets.

6.15B	The French Subsidiary represents and warrants to the Bank it is duly incorporated and validly existing as a limited liability company (societe par actions simplifiee) under the laws of France and it has power to carry on its business as it is now being conducted and to own its property and other assets.

6.15C	The Italian Subsidiary represents and warrants to the Bank that it is duly incorporated and validly existing as a limited liability company (societa a responsabilita limitata) under the laws of Italy and it has power to carry on its business as it is now being conducted and to own its property and other assets.

6.15D	Each of the Borrowers represents and warrants to the Bank that:

(a)	it has the power to execute, deliver and perform its obligations under this Contract and all necessary corporate, shareholder and other action has been taken to authorise the execution, delivery and performance of the same by it;

(b)	this Contract constitutes its legally valid, binding and enforceable obligations;

(c)	the execution and delivery of, the performance of its obligations under and compliance with the provisions of this Contract do not and will not:

(i)	contravene or conflict with any applicable law, statute, rule or regulation, or any judgement, decree or permit to which it is subject;

(ii)	contravene or conflict with any agreement or other instrument binding upon it which might reasonably be expected to have a material adverse effect on its ability to perform its obligations under this Contract;

(iii)	contravene or conflict with any provision of its by-laws or memorandum and articles of association;

(d)

the latest available audited accounts of that Borrower (and, in case of the Parent, latest available audited accounts of the Parent) have been prepared on a basis consistent with previous years and have been approved by its auditors as representing a true and fair view of the results of its operations for that year and accurately disclose or reserve against all the liabilities (actual·or contingent) of that Borrower;

(e)	there has been no Material Adverse Change since 30 June 2015;

(f)	no event or circumstance which constitutes an Event of Default has occurred and is continuing unremedied or unwaived;

(g)	no litigation, arbitration, administrative proceedings or investigation is current or to its knowledge is threatened or pending before any court, arbitral body or agency which has resulted or if adversely determined is reasonably likely to result in a Material Adverse Change, nor is there subsisting against it or any of its subsidiaries any unsatisfied judgement or award;

(h)	it has obtained all necessary Authorisations in connection with this Contract and in order to lawfully comply with its obligations hereunder, and the Project and all such Authorisations are in full force and effect and admissible in evidence;

(i)	its payment obligations under this Contract rank not less than pari passu in right of payment with all other present and future unsecured and unsubordinated obligations under any of its debt instruments except for obligations mandatorily preferred by law applying to companies generally;

(j)	it is in compliance with Article 6.05(e) and to the best of its knowledge and belief (having made due and careful enquiry) no Environmental Claim has been commenced or is threatened against it;

(k)	it is in compliance with all undertakings under this Article 6;

(l)	no financial covenants have been concluded with any other creditor of the Group which are more restrictive than the ones contained in the Contract; and

(m)	to the best of its knowledge, no funds invested in the Project by the Borrower or by its controlling entities or by another member of the Group are of illicit origin, including products of money laundering or linked to the financing of terrorism. The Borrower shall promptly inform the Bank if at any time it becomes aware of the illicit origin of any such funds.

7.01	Guarantee and indemnity

(a)	guarantees to the Bank punctual performance by each Borrower of all that Borrower's obligations under this Contract or other transactional documents;

(b)	undertakes with the Bank that whenever a Borrower does not pay any amount when due under or in connection with this Contract or other transactional documents, that Co-debtor shall immediately on demand pay that amount as if it was the principal Borrower; and

(c)

agrees with the Bank that if any obligation guaranteed by it is or becomes unenforceable, invalid or illegal, it will, as an independent and primary obligation, indemnify the Bank immediately on demand against any cost, loss or liability it incurs as a result of a Borrower not paying any amount which would, but for such unenforceability, invalidity or illegality, have been payable by it under this Contract on the date when it would have been due. The amount payable by a Co-debtor under this indemnity will not exceed the amount it would have had to pay under this Article 7.01 if the amount claimed had been recoverable on the basis of a guarantee.

(a)	any time, waiver or consent granted to, or composition with, any Borrower or other person;

(b)	the release of any other Borrower or any other person under the terms of any composition or arrangement with any creditor of any member of the Group;

(c)	the taking, variation, compromise, exchange, renewal or release of, or refusal or neglect to perfect, take up or enforce, any rights against, or security over assets of, any Borrower or other person or any non-presentation or non-observance of any formality or other requirement in respect of any instrument or any failure to realise the full value of any security;

(d)	any incapacity or lack of power, authority or legal personality of or dissolution or change in the members or status of an Borrower or any other person;

(e)	any amendment, novation, supplement, extension, restatement (however fundamental and whether or not more onerous) or replacement of this Contract or any other document or security including without limitation any change in the purpose of, any extension of or any increase in any facility or the addition of any new facility under this Contract or other document or security;

(f)	any unenforceability, illegality or invalidity of any obligation of any person under this Contract or any other document or security; or

(g)	any insolvency or similar proceedings.

(a)	refrain from applying or enforcing any other moneys, security or rights held or received by the Bank (or any trustee or agent on its behalf) in respect of those amounts, or apply and enforce the same in such manner and order as it sees fit (whether against those amounts or otherwise) and no Co-debtor shall be entitled to the benefit of the same; and

(b)	hold in an interest-bearing suspense account any moneys received from any Co­ debtor or on account of any Co-debtor's liability under this Article 7.01.

(a)	to be indemnified by an Borrower;

(b)	to claim any contribution from any other guarantor of any Borrower's obligations under this Contract;

(c)	to take the benefit (in whole or in part and whether by way of subrogation or otherwise) of any rights of the Bank under this Contract or of any other guarantee or security taken pursuant to, or in connection with, this Contract by the Bank;

(d)	to bring legal or other proceedings for an order requiring any Borrower to make any payment, or perform any obligation, in respect of which any Co-debtor has given a guarantee, undertaking or indemnity under Article 7.01A;

(e)	to exercise any right of set-off against any Borrower; and/or

(f)	to claim or prove as a creditor of any Borrower in competition with the Bank.

(a)	Each Borrower (other than the Parent) by its execution of this Contract irrevocably appoints the Parent (acting through one or more authorised signatories) to act on its behalf as its agent in relation to this Contract and irrevocably authorises:

(i)	the Parent on its behalf to supply all information concerning itself contemplated by this Contract to the Bank and to give all notices and instructions (including, in the case of a Borrower, Disbursement Requests); and

(ii)	the Bank to give any notice, demand or other communication to that Borrower pursuant to this Contract to the Parent,

(b)

Every act, omission, agreement, undertaking, settlement, waiver, amendment, supplement, variation, notice or other communication given or made by the Parent or given to the Parent under this Contract on behalf of another Borrower or in connection with this Contract shall be binding for all purposes on that Borrower as if that Borrower had expressly made, given or concurred with it. In the event of any conflict between any notices or other communications of the Parent and any other Borrower, those of the Parent shall prevail.

(a)	any Security Interest listed in Schedule F (Existing Security) except to the extent the principal amount secured by that Security exceeds the amount stated in that Schedule;

(b)	any Security Interest arising by operation of law and in the ordinary course of trading;

(c)	any guarantee comprising a netting or set-off arrangement entered into by the Parent or any of its Subsidiaries in the ordinary course of their banking arrangements for the purpose of netting debt and credit balances;

(d)

any Security Interest securing indebtedness the outstanding principal amount of which (when aggregate with the outstanding principal amount of any other indebtedness which has the benefit of Security Interest given by any member of the Group other than any permitted under (a) to (c) above) does not exceed in aggregate EUR 10,000,000.00 (ten million euros), or following, and subject to, Completion, USO 15,000,000.00 (fifteen million US dollars) (or its equivalent);

(a)	The Parent (and, upon request of the Bank, the relevant Borrower) shall deliver to the Bank:

(i)	the information in content and in form, and at the times, specified in Schedule A.2 or otherwise as agreed from time to time by the parties to this Contract; and

(ii)	any such information or further document concerning the financing, procurement, implementation, operation and environmental matters of or for the Project as the Bank may reasonably require within a reasonable time,

(b)	The Borrowers shall submit for the approval of the Bank without delay any material change to the Project, also taking into account the disclosures made to the Bank in connection with the Project prior to the signing of this Contract, in respect of, inter alia, the price, design, plans, timetable or to the expenditure programme or financing plan for the Project;

(c)	The Borrowers shall promptly inform the Bank of:

(i)	any action or protest initiated or any objection raised by any third party or any genuine complaint received by any Borrower or any Environmental Claim that is to its knowledge commenced, pending or threatened against it with regard to environmental or other matters affecting the Project;

(ii)	any fact or event known to any Borrower, which may substantially prejudice or affect the conditions of execution or operation of the Project;

(iii)	a genuine allegation, complaint or information with regard to Criminal Offences related to the Project;

(iv)	any non-compliance by it with any applicable Environmental Law; and

(v)	any suspension, revocation or modification of any Environmental Approval, and set out the action to be taken with respect to such matters.

(d)	The Borrowers shall provide to the Bank, if so requested:

(i)	a certificate of its insurers showing fulfilment of the requirements of Article6.05(c); and

(ii)	annually, a list of policies in force covering the insured property forming part of the Project, together with confirmation of payment of the current premiums.

(a)	The Parent shall deliver to the Bank:

(i)

as soon as they become available but in any event within 180 (one hundred and eighty) days after the end of each of its financial years its audited consolidated and unconsolidated annual report, balance sheet, profit and loss account and auditors report for that financial year together with a Compliance Certificate as set out in Schedule 0.2 signed by two directors reported on by reputable independent auditors confirming compliance with the financial covenants pursuant to Article 6.07 and with evidence of such compliance and related calculations; and

(ii)

as soon as they become publicly available but in any event within 120 days after the end of each of the relevant accounting periods its interim consolidated and unconsolidated semi-annual report, balance sheet and profit and loss account for the first half-year of each of its financial years together with a Compliance Certificate as set out in Schedule D.2 signed by two directors confirming compliance with the financial covenants pursuant to Article 6.07 and with evidence of such compliance and related calculations;

(iii)	as soon as Completion occurs, a certificate signed by a director of the Parent certifying that the “Cyberonics Merger Effective Time” (as such term is defined in the Transaction Agreement) has occurred in accordance with the Transaction Agreement; and

(iv)	from time to time, such further information on its general financial situation as the Bank may reasonably require or such certificates of compliance with the undertakings of Article 6 as the Bank may deem necessary;

(b)	Each of the Borrowers shall inform the Bank immediately of:

(i)	any material alteration to its by-laws or memorandum and articles of association or shareholding structure and of any change of ownership of 5% or more of its shares after the Effective Date, other than in accordance with Article I (The Mergers) and Article II (Effect of the Merger on Capital Stock) of the Transaction Agreement;

(ii)	any fact which obliges it to prepay any financial indebtedness or any European Union funding;

(iii)	any event or decision that constitutes or may result in a Prepayment Event;

(iv)	any intention on its part to grant any security over any of its assets in favour of a third party;

(v)	any intention on its part to relinquish ownership of any material component of the Project;

(vi)	any fact or event that is reasonably likely to prevent the substantial fulfilment of any obligation of the Borrowers under this Contract;

(vii)	any event listed in Article 10.01 having occurred or being threatened or anticipated;

(viii)	any investigations concerning the integrity of the members of any of the Borrowers' Board of Directors or other administrative body or managers;

(ix)

to the extent permitted by law, any material litigation, arbitration, administrative proceedings or investigation carried out by a court, administration or similar public authority, which, to the best of its knowledge and belief, is current, imminent or pending against any Borrower or any of their controlling entities or members of any of the. Borrowers' management bodies in connection with Criminal Offences related to the Loan or the Project;

(x)	any measure taken by the Borrowers pursuant to Article 6.0S(f) of this Contract; and

(xi)	any litigation, arbitration or administrative proceedings or investigation which is current, threatened or pending and which might if adversely determined result in a Material Adverse Change.

(a)	to visit the sites, installations and works comprising the Project,

(b)	to interview representatives of that Borrower, and not obstruct contacts with any     other person involved in or affected by the Project; and

(c)	to review that Borrower's books and records in relation to the execution of the Project and to be able to take copies of related documents to the extent permitted by the law.

(a)

Each Borrower shall pay to the bank any sums or expenses incurred or suffered by the Bank as a consequence of the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation or compliance with any law or regulation made after the Effective Date, in accordance with or as a result of which (i) the Bank is obliged to incur additional costs in order to fund or perform its obligations under this Contract, or (ii) any amount owed to the Bank under this Contract or the financial income resulting from the granting of the Credit or the Loan by the Bank to the Borrower is reduced or eliminated.

(b)	Without prejudice to any other rights of the Bank under this Contract or under any applicable law, each Borrower shall indemnify and hold the Bank harmless from and against any loss incurred as a result of any payment or partial discharge that takes place in a manner other than as expressly set out in this Contract.

(c)

The Bank may set off any matured obligation due from any Borrower under this Contract (to the extent beneficially owned by the Bank) against any obligation (whether or not matured) owed by the Bank to that Borrower regardless of the place of payment, booking branch or currency of either obligation. If the obligations are in different currencies, the Bank may convert either obligation at a market rate of exchange in its usual course of business for the purpose of the set-off. If either obligation is unliquidated or unascertained, the Bank may set off in an amount estimated by it in good faith to be the amount of that obligation.

(a)	if any Borrower does not pay on the due date any amount payable pursuant to this Contract at the place and in the currency in which it is expressed to be payable, unless (i) its failure to pay is caused by an administrative or technical error or a Disruption Event and (ii) payment is made within 3 (three) Business Days of its due date;

(b)	if any information or document given to the Bank by or on behalf of any of the Borrowers or any representation, warranty or statement made or deemed to be made by any of the Borrowers in or pursuant to this Contract or in connection with the negotiation or performance of this Contract is or proves to have been incorrect, incomplete or misleading in any material respect;

(c)	if, following any default of any Borrower or any other member of the Group in relation to any Joan, or any obligation arising out of any financial transaction, other than the Loan

(i)	any Borrower or any other member of the Group is required or is capable of being required or will, following expiry of any applicable contractual grace period, be required or be capable of being required to prepay, discharge, close out or terminate ahead of maturity such other loan or obligation; or

(ii)	any financial commitment for such other loan or obligation is cancelled or suspended,

(d)	if any Borrower or any member of the Group is unable to pay its debts as they fall due, or suspends its debts, or makes or seeks to make a composition with its creditors;

(e)

if any corporate action, legal proceedings or other procedure or step is taken in relation to the suspension of payments, a moratorium of any indebtedness, dissolution, administration or reorganisation (by way of voluntary arrangement, scheme of arrangement or otherwise) or an order is made or an effective resolution is passed for the winding up of any Borrower or any member of the Group, or if any Borrower or any member of the Group takes steps towards a substantial reduction in its capital, is declared insolvent or ceases or resolves to cease to carry on the whole or any substantial part of its business or activities;

(f)	if an encumbrancer takes possession of, or a receiver, liquidator, administrator, administrative receiver or similar officer is appointed, whether by a court of competent jurisdiction or by any competent administrative authority or by any person, of or over, any part of the business or assets of any Borrower or any member of the Group or any property forming part of the Project;

(g)	if any Borrower or any member of the Group defaults in the performance of any obligation in respect of any other loan granted by the Bank or financial instrument entered into with the Bank;

(h)	if any Borrower or any member of the Group defaults in the performance of any obligation in respect of any other loan made to it from the resources of the Bank or the European Union;

(i)	if any distress, execution, sequestration or other process is levied or enforced upon the property of the Borrower or any property forming part of the Project and is not discharged or stayed within 14 (fourteen) days;

(j)	if a Material Adverse Change occurs, as compared with the Borrowers' condition at the Effective Date; or

(k)	if it is or becomes unlawful for any Borrower to perform any of its obligations under this Contract or other transactional documents or this Contract or other transactional documents is not effective in accordance with its terms or is alleged by any Borrower to be ineffective in accordance with its terms.

(a)	if any Borrower fails to comply with any obligation under this Contract not being an obligation mentioned in Article 10.01A; or

(b)	if any fact related to the Borrower or the Project stated in the Recitals materially alters and is not materially restored and if the alteration either prejudices the interests of the Bank as lender to the Borrower or adversely affects the implementation or operation of the Project,

(a)	The courts of England have exclusive jurisdiction to settle any dispute (a “Dispute”) arising out of or in connection with this Contract (including a dispute regarding the existence, validity or termination of this Contract or the consequences of its nullity) or any non-contractual obligation arising out of or in connection with this Contract.

(b)	The parties agree that the courts of England are the most appropriate and convenient courts to settle Disputes between them and, accordingly, that they will not argue to the contrary.

(c)	the legality, validity or enforceability in that jurisdiction of any other term of this Contract or the effectiveness in any other respect of this Contract in that jurisdiction; or

(e)	the legality, validity or enforceability in other jurisdictions of that or any other term of this Contract or the effectiveness of this Contract under the laws of such other jurisdictions.

For the Bank	Attention: Ops A/MA/2-IM BK&CORP/-/- 100 boulevard Konrad Adenauer

For the Parent	Attention: Head of Treasury

For the French Subsidiary	Finance Manager Sorin CRM SAS

For the Italian Subsidiary	Finance Manager

A.	EURIBOR

(a)	in respect of a relevant period of less than one month, the Screen Rate (as defined below) for a term of one month;

(b)	in respect of a relevant period of one or more months for which a Screen Rate is available, the applicable Screen Rate for a term for the corresponding number of months; and

(c)	in respect of a relevant period of more than one month for which a Screen Rate is not available, the rate resulting from a linear interpolation by reference to two Screen Rates, one of which is applicable for a period next shorter and the other for a period next longer than the length of the relevant period,

B.	GENERAL

(a)	AH percentages resulting from any calculations referred to in this Schedule will be rounded, if necessary, to the nearest one hundred-thousandth of a percentage point, with halves being rounded up.

(b)	The Bank shall inform the relevant Borrower without delay of the quotations received by the Bank.

(c)	If any of the foregoing provisions becomes inconsistent with provisions adopted under the aegis of EMMI and EURIBOR ACI (or any successor to that function of EMMI and EURIBOR ACI as determined by the Bank), the Bank may by notice to the relevant Borrower amend the provision to bring it into line with such other provisions.

(a)	no Prepayment Event has occurred and is continuing unremedied;

(b)	we are in compliance with the financial covenants pursuant to Article 6.07 and attached is evidence of such compliance and related calculations;

(c)	no security of the type prohibited under Article 7.02 has been created or is in existence;

(d)	there has been no material change to any aspect of the Project or in respect of which we are obliged to report under Article 8.01, save as previously communicated by us;

(e)	we have sufficient funds available to ensure the timely completion and implementation of the Project in accordance with Schedule A.1;

(f)	no event or circumstance which constitutes or would with the passage of time or giving of notice under the Finance Contract constitute an Event of Default has occurred and is continuing unremedied or unwaived;

(g)	no litigation, arbitration administrative proceedings or investigation is current or to our knowledge is threatened or pending before any court, arbitral body or agency which has resulted or if adversely determined is reasonably likely to result in a Material Adverse Change, nor is there subsisting against us or any of our subsidiaries any unsatisfied judgement or award;

(h)	the representations and warranties to be made or repeated by us under Article 6.15 are true in all material respects; and

(i)	no Material Adverse Change has occurred, as compared with the situation at the Effective Date.

(i)	[insert details and computations of covenants to be certified ;

(ii)	[no security of the type prohibited under Article 7.02 has been created or is in existence;]

(iii)	[no event or circumstance which constitutes or would with the passage of time or giving of notice under the Finance Contract constitute an Event of Default has occurred and is continuing unremedied or unwaived. [If this statement cannot be made, this certificate should identify any potential event of default that is continuing and the steps, if any, being taken to remedy it.

(a)

Consolidated Net Financial Indebtedness to Consolidated EBITDA: Consolidated Net Financial Indebtedness as at any Accounting Date shall not be more than 2.50x times the Consolidated EBITDA for the Test Period ending on that Accounting Date, provided that for the purposes of determining this ratio as of an Accounting Date falling on 30 June, “Consolidated EBITDA” shall mean the “Consolidated EBITDA” calculated in respect of the period of twelve months ending on the last day of the first semester of the Borrowers' fiscal year

(b)	Consolidated Net Financial Indebtedness to Consolidated Net Worth: Consolidated Net Financial Indebtedness as at any Accounting Date shall not be more than 0.50 x times the Consolidated Net Worth as at that Accounting Date.

(c)	Consolidated EBITDA to Consolidated Total Net Interest Payable: Consolidated EBITDA for the Test Period ending on an Accounting Date shall not be lower than 6.30 x times the Consolidated Total Net Interest Payable for that Test Period.

(d)	Consolidated Net Worth: the Consolidated Net Worth shall at no times be lower, at any time, than USO 725,000,000.00.

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

2.	Section 3(v) shall be amended to replace the provision in its entirety with the following:

3.	Section 4(i) shall be amended to replace the provision in its entirety with the following:

4.	Section 4(iii) shall be amended to replace the provision in its entirety with the following:

5.	Section 4(v) shall be amended to replace the provision in its entirety with the following:

6.	The Agreement shall be amended to include the following as a new Section 14:

7.	Right to Advice of Counsel. Employee acknowledges that Employee has had the right to consult with counsel and is fully aware of his rights and obligations under Agreement and this Amendment

8.	Except as expressly modified by this Amendment, the provisions of the Agreement remain unchanged and in full force and effect.

1.	Bonus

2.	Long Term Incentive

3.	Severance Pay

4.	Travel/Location

5.	Company Car/Car Allowance

6.	Housing/Goods & Services

7.	Taxation – US

•	You will be responsible to contribute the amount of US wage tax according to general practice. Thus, during your employment, you will not pay more nor less taxes than had you continued living and working in the US full-time (hypothetical taxes). This method is called "Tax Equalization," and it is a benefit provided by the Company under the advisement of its US tax consultants.

8.	Taxation – Italy

9.	Tax Filing Assistance

10.	US Benefits

◦	Vacation accrual at the rate of four weeks per year,

◦	Eligibility for executive health exams,

◦	Participation in the Executive Deferred Compensation Plan that includes an annual employer contribution of 6% of salary regardless of whether you personally contribute to the plan,

◦	Executive Life and Long Term Disability insurance.

---

---

•	Eligibility for executive health exams while in the US,

•	Participation in the Executive Deferred Compensation Plan that includes an annual employer contribution of 6% of salary regardless of whether you personally contribute to the plan,

•	Executive Life and Long Term Disability insurance.

---

Position	Vice President, Global Health Economics and Reimbursement

Start Date	January 7 2013

Holiday entitlement	Holiday entitlement is based on a full 12 months’ employment and is 24 days. Your 2013 entitlement will be pro rata from your date of commencement with the Company.

---

Reporting to:	CEO

Contract type:	Permanent

---

---

---

•	may not attend your place of work or any other premises of the Company or any associated company;

•	may be asked to resign immediately from any offices you hold in the Company or any associated company;

•	may not be required to carry out duties during the remaining period of your employment;

•	must return to the Company all documents and other materials (including copies) belonging to the Company or associated companies containing confidential information;

•	may not without the prior written permission of the Company contact or attempt to contact any client, customer, supplier, agent, professional advisor, broker or banker of the Company or any associated company or any employee of the Company or associated company.

---

---

A)	The Company is an affiliate of the Sorin Group of Companies (hereinafter "Sorin Group").

B)

The Employee acknowledges and agrees to the fact that the employment relationship will give him/her access to customers and to business secrets of the Company and the Sorin Group and that the use of such knowledge other thau for the benefit of the Com­ pany would significantly damage the Company and/or the Sorin Group. The Employee further acknowledges and agrees that as a result of its employment by the Company, he/she will become acquainted with other employees of the Company and the Sorin Group and their abilities and that such information is proprietary to the Company and/or the Sorin Group.

---

---

1.	Commencement ofEmployment

1.1	The employment shall commence on March 1'\ 2009 ("Effective Date"). The first three months of your employment will be your probationary period.

2.	Position, Place ofWork

1.2	The Employee shall be employed and appointed by the Company as Vice Pre­ sident, Intercontinental. The Employee shall report to the President, Cardio­ pulmonary Business Unit and Intercontinental.

1.3	The Employee's place ofwork shall be at the Company's offices at the branch office of Sorin Group International SA in Zürich or other premises in Switzer­ land that may be eventually decided. The Employee's duties will require the Employee to regularly travel on business for the Company to other locations, both in Switzerland and abroad.

3.	Legal Compliance

1.4	The Employee expressly declares that there are no legal and/or contractual hindrances, which would prohibit a contract of employment with the Com­ pany.

4.	Remuneration

1.5	The base salary shall be CHF 422'500.- gross p.a. payable in 12 equalmonthly installments in arrears on or around the last working day in the respective month ("Base Salary). The Base Salary shall be the remuneration for both regular working time and overtime and any other service rendered by the Em­ ployee for the Company.

1.6

The Employee shall also be entitled to a variable bonus ("Variable Bonus") equivalent to 35% of Base Salary of the reference year, as per at point 4.1, upon 1 00% achievement of the assigned targets. Any Variable Bonus shall be subject to the achievement of both Sorin Group's targets and Employee's per­ sona! objectives, which shall be established on an aunual basis with reference to the then applicable policy for incentives and bonuses. Details of the applica­ ble policy for incentives and bonuses currently applicable will be provided separately. For 2009, the bonus will be pro-rata.

---

1.7

Unless otherwise express!y agreed upon in writing, the payment of any gratni­ ties, bonus, profit shares, premiums or other extra payments as well as fringe benefits shall be on a voluntary basis, subject to the provision that even re­ peated payments without the explicit repetition of such reservation, shall not create any claim for the Employee, either in respect to their cause or their amount, either for the past or for the future.

5.	Reimbursement of Expenses

6	Fringe Benetïts

6.1	The Employee will be entitled to a company car, in line with the Company's car policy. However, as agreed, the Employee will receive a car allowance in­ stead. The Company will provide the Employee with a fuel card.

6.2	Furthermore, the Company shall provide the Employee with a Mobile Tele­ phone, laptop and an Electronic Agenda.

7.	Social Security and Insurance

7.1	The contributions for social security (such as compulsory old-age, disability and unemployment insurance) shall be charged in accordance with the cantonal legislation in place at the time.

---

8.	Pension Scheme

9.	Hours ofWork

10.	Employee's General Obligations

10.1	The Employee shall faithfully and diligently perform his/her tasks, in compli­ ance with the instructions given to him/her by the assigned superior.

10.2	The Employee shall devote his/her full working time to the Company and shall not undertake any other professional activities, whether paid or unpaid, and/or accept other employments, duties or assigmnents.

11.	Incapacity

11.1.

Should the Employee be incapacitated due to illness, accident or the like to perform his/her duties required under this Agreement, the Employee shall in­ form his/her superiors immediately and shall provide a medical certificate evi­ dencing such incapacity in case the incapacity is more than three days. The Company reserves the right to require the Employee, at any time, to undergo a medical examination conducted by the Company's medical doctor, at the Com­ pany's expense, and to provide a medical certificate. The Employee hereby au­ thorizes such medical doctor to disclose and discuss with the Company the re­ sults of its examination relating to the Employee's incapacity to work.

11.2	During absence from work due to illness, accident or the like, the Employee shall be paid in accordance with the Swiss law and the insurance in place at the time.

12.	Holidays

12.1	The Employee shall be entitled to 25 days of holiday p.a. (pro rata) in addition to the public holidays as applicable in the jurisdiction of the registered place of incorporation or the assigned place of work.

12.2	Holidays shall be taken in the periods agreed with the assigned superior. Suffi­ dent notice period of intention to take holiday must be given.

13.	Term and Termination

---

---

14.	Confidentiality

14.1

As used herein, "Confidential Information" shall include, but not be limited to, ail technical, business and trade information of the Company and the Sorin Group (including any subsidiary/sister/parent companies), and of any third party, whether patentable or not, which is of a confidential, trade secret and/or proprietary character and which is either developed by the Employee (alone or with others) orto which the Employee has had access during his/her employ­ ment hereunder.

14.2

The Employee shall not, at any time during the continuance of his/her em­ ployment hereunder or at any time thereafter, directly or indirectly, use for his/her own purpose or for any purposes other than those of the Company, re­ cord, divulge, disclose or communicate to any person, company, business en­ tity or other organization or, through any failure to exercise due care and dili­ gence, cause any unauthorized disclosure of, any trade secrets or Confidential Information, except as may be necessary for the proper performance of the Employee's duties or as may be specifically authorized in writing by the Man­ aging Director or the Board of Directors.

14.3

Upon termination of his/her employment hereunder (for whatever reason) and at any other time at the Company's request the Employee shall, without retain­ ing any copies or other records thereof, deliver to the Company or any person the Company may nominate each and every document (in paper and electronic form) and ali other material of whatever nature in the possession or under the control of the Employee containing or relating directly or indirectly to any Confidential Information.

14.4	The confidentiality undertaking set forth in this Section shall cease to apply to any information which shall become available to the public generally other­ wise tl1an through the default of the Employee.

15.	Intellectual Property, Inventions and Designs

15.1	Ali inventions and designs and other proprietary work effort which the Em­ ployee either alone or in conjunction with others invents, conceives, makes or produces white employed by the Company (whether during working hours or not) and which directly or indirectly:

a)	relates to matters within the scope of the Employee's duties or field of responsibility; or

b)	are based on the Employee's knowledge of the actual or anticipated business or interests of the Company or any company of the Sorin Group; or

c)	are aided by the use of time, materials, facilities or infonnation of the Company or any company of the Sorin Group;

---

15.2

The Company reserves the right to acquire any invention, design and proprie­ tary work effort invented, conceived, made or produced by the Employee merely on occasion of his/her employment activity, but not during the per­ formance of his/her contractual duties. The Company shall inform the Em­ ployee in writing within six months upon receipt of the Employee's notice whether it wishes to acquire the rights to such invention, design, or proprietary work effort or whether such invention, design or proprietary work effort will be released to the Employee.

15.3

The Employee shall execute and perform at the expense of the Company both during the continuance of his/her employment hereunder and at ail times there­ after all such applications, assignments, documents, acts and things as may reasonably be required by the Company for the purpose of obtaining and en­ forcing in such countries as the Company may direct all necessary legal protec­ tion in respect of inventions, designs and other proprietary work effort owned by the Company and for vesting the same in the Company or as the Company may direct.

15.4	For all inventions, designs and other proprietary work efforts that are invented by the Employee while performing its employment activity, the Company shall pay to the Employee such compensation as is payable under the applicable mandatory laws (Article 332 ffSwiss Code of Obligations).

17.	Restriction on Competition

17.1

The Employee shall not, for as long as he/she remains an employee of the Company and, upon written request by the Company, during a period of 12 months from the taking effect of the termination of this Agreement, alone or jointly with, or as manager, agent or director for, or employee of any person or as a shareholder, directly or indirectly, carry on or be engaged, concemed or interested in any business competitive to the business of the Company in the territory of Latin America, Mediterranean & Africa, South East Asia and Greater China, Middle East, Turkey, India, Pakistan, Austria, Central and Eastern Europe, Japan, Canada and Australia. The non-compete undertaking set forth in this Section shall apply to any product competing with the Com­ pany's products line, and in particular but not limited to, Cardiopulmonary, Cardiac Rhythm Management and Heart Valve products.

---

17.2

In the case that the non-compete covenant is enforceable, you shall be entitled to a single non-compete indemnity of a lump sum amount equal to 6 months of gross remuneration (base salary plus the average variable paid out in the last three years of employment) unless the Company waives the effective application of the non­ compete covenant. Inthe case of enforcement of the non-compete covenant and if you fail to comply with its provisions, you shall repay to the Company the non­ compete equivalent to this indemuity, without prejudice to any additional damages which the Company may clairn.

17.3	If the Employee is terminated for cause, he/she shall not receive any compen­ sation for the non-competition obligation described above.

17.4

The Employee shall not, for as long as he/she remains an employee of the Company and during a period of one year from the taking effect of the termi­ nation of this Agreement, i.e. from the end of this Agreement (i) solicit, induce or attempt to induce any person who is an employee of the Company and the Sorin Group to leave the Sorin Group or to engage in any business that corn­ petes with the Sorin Group; or (ii) hire or assist in the hiring of any person who is an employee of the Sorin Group to work for any business that competes with the Company or the Sorin Group.

18.	Contractual Penalty

---

---

19.	Special Undertaking

20.	General Provisions

20.1	The Employee is not allowed during the whole term of this Agreement to ac­ cept orto request in connection with his/her position of the Company either di­ rectly or indirectly any gifts, commissions, benefit or indemnifications from any third party.

20.2	All notices shall be addressed to the other party at the address specified at the beginning of this Agreement, or to any other address as provided by the parties through subsequent written notice.

20.3

This Agreement constitutes the entire agreement and understanding among the parties with respect to the employment of the Employee with the Company, and shall supersede all prior oral and written agreements or understandings of the parties relating hereto. Any representations or statement (in whatever form) made to the Employee in connection with the Employee's employment not in­ corporated in this Agreement shall not be valid and have no effect.

20.4

This Agreement may only be modified or amended by a document signed by the Employee and the Company. Any provisions contained in this Agreement may only be waived by a document signed by the party waiving such provi­ sion. No waiver of any violation or non-performance of this Agreement in one instance shall be deemed to be a waiver of any violation or non-performance in any other instance. All waivers must be in writing.

20.5

If any provision of this Agreement is found by any competent authority to be void, in-valid or nnenforceable, such provision shall be deemed to be deleted from this Agreement and the remaining provisions of this Agreement shall continue in full force. In this event, the Agreement shall be construed, and, if necessary, amended in a way to give effect to, or to approximate, or to achieve a result which is as close as legally possible to the result intended by the provi­ sion hereof determined to be void, illegal or unenforceable.

20.6	The rights of a party shall not be prejudiced or restricted by any indulgence or forbearance extended to any other party. A waiver to pursue any breach of con­ tract by a party shall not operate as a waiver of the respective right or as a waiver to daim any subsequent breach. Any provision of this Agreement may be waived only by a written statement ofthe waiving party.

---

21.	Governing Law and Jurisdiction

21.1	This Agreement, including the jurisdiction clause shall be govemed by, inter­ preted and construed in accordance with the applicable laws of Switzerland.

21.2	Exclusive jurisdiction for ali disputes arising out of or in connection with this Agreement shall be with the ordinary courts at the registered place of incorpora­ tion of the Company, the place of work or the place of living of the Employee.

1.	This contract has no temporal limit and could be terminated with the appropriate notice period required.

2.	Your individual conditions are

•	Qualification: Dirigente (Executive)

•	Job title: Director Corporate Legal affairs

•	Workplace: Milan

•	Annual gross salary: 160.000,00 € paid in 14 monthly payslip divided into

3.	Your role as Dirigente (Executive) includes the possibility to cover - without any other further compensation – additional roles in other Companies directly or non directly controlled, in Italy or abroad.

4.	Please give back to this Company a copy signed of this agreement letter for acceptance and ,more specific, Clause n° 3 acceptance.

(i)	conduct that results in Employee’s termination for Cause as defined in Section 9(c) (or that would have resulted in termination for Cause if known by the Company prior to the termination of Employee’s employment);

(ii)	Employee engages in conduct in violation of Section 8 of this Agreement; or

(iii)	Employee engages in conduct in violation of Section 13 of this Agreement.

(i)

the acquisition by any “person,” as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), other than the Company, a subsidiary of the Company or a Company employee benefit plan, of “beneficial ownership” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company which, together with any securities held by the person, represents 50% or more of the combined voting power of the Company’s then outstanding securities entitled to vote generally in the election of directors; or

(ii)

the consummation of a reorganization, merger, consolidation or other form of corporate transaction or series of transactions, in each case, with respect to which persons who were the shareholders of the Company immediately prior to such reorganization, merger or consolidation or other transaction do not, immediately thereafter, own more than 50% of the combined voting power entitled to vote generally in the election of directors of the reorganized, merged or consolidated company’s then outstanding voting securities in substantially the same proportions as their ownership immediately prior to such event; or

(iii)	the closing of a sale or disposition by the Company of all or substantially all the Company’s assets; or

(iv)

a change in the composition of the Board, as a result of which less than a majority of the directors are Incumbent Directors. “Incumbent Directors” shall mean directors who either (A) are directors of the Company as of the Effective Date, or (B) are elected, or nominated for election, thereafter to the Board with the affirmative votes of at least a majority of the Incumbent Directors at the time of such election or nomination, but “Incumbent Director” shall not include an individual whose election or nomination is in connection with (i) an actual or threatened election contest (as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or an actual or threatened solicitation of proxies or consents by or on behalf of a person other than the Board or (ii) a plan or agreement to replace a majority of the then Incumbent Directors; or

(v)	the approval by the Board or the stockholders of the Company of a complete or substantially complete liquidation or dissolution of the Company.

---

---

---

---

---

---

---

---

---

---

---

---

1.	Position

2.	Remuneration

1.	We herewith confirm that effective date 1st of July 2008 Sorin Biomedica Cardio transfers your Dirigente (Executive) employment contract to Sorin Spa.

2.	From this date you perform subordinated work for Sorin Spa under following terms

•	Status: Dirigente (Executive)

•	Job title: VP, Group Controller

•	Workplace: Milan

•	Annual gross salary: 104.679,00 € paid in 14 monthly payslip

3.	You will keep your Dirigente (Executive) status starting date as 1st of June, 2008 related to Seniority benefits.

4.	Your role as Dirigente (Executive) includes the possibility to cover - without any other further compensation – additional roles in other Companies directly or non directly controlled, in Italy or abroad.

---