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EXHIBIT 10.4




CONFIDENTIALITY, NON-COMPETITION AND NON-SOLICITATION

EMPLOYMENT AGREEMENT




     This Confidentiality, Non-Competition and Non Solicitation Employment
Agreement (this “Agreement”) is made by and between Centerpulse Orthopedics Ltd
(“Company”) and Richard Fritschi (“Employee”).



Recitals




     A. For purposes of this Agreement, “Parent” means an entity which is a
holding company of or holds a controlling interest in Company; “Affiliates”
means a subsidiary of Company or the Parent of Company or a company over which
Company or any holding company of Company has control; and the definition of
each of Company, Parent and Affiliates, includes any of their
successors-in-interest, including, but not limited to, Zimmer, Inc. (“ZINC”).



     B. Company, Parent and the Affiliates are part of the global holdings of
Zimmer Holdings, Inc., a publicly traded corporation incorporated under the
laws of the state of Delaware, U.S.A., the primary purpose of which is to serve
as the umbrella entity for ZINC. Company, Parent and the rest of the
Affiliates located throughout the world are engaged in the development,
manufacture, distribution, and sale of orthopaedic medical and/or oral
rehabilitation devices, products, and services.



Agreement




     NOW, THEREFORE, in consideration of the foregoing recitals, the promises
contained herein, those certain benefits contained in each Zimmer Holdings,
Inc. 2001 Stock Incentive Plan Nonqualified Stock Option Grant Agreement to
which Employee is a party, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Company and Employee
agree as follows:



     1. Acknowledgements. Employee acknowledges that Company is engaged in the
highly competitive business of the development, manufacture, distribution, and
sale of orthopaedic medical, oral rehabilitation and/or spine or trauma
devices, products, and services, and that Employee serves in an executive,
managerial capacity, and/or other designated position



 









 




for Company. Further, Employee acknowledges that in the course of Employee’s
employment with Company, Employee i) has been given and will continue to be
given access to Confidential Information (as hereinafter defined); ii) has
participated and will continue to participate in the development of and/or
usage of inventions, products, concepts, methods, or technologies which are
related to Company’s business; iii) has been given and will continue to be
given specialized training relating to Company’s products and/or processes;
and/or iv) has been given and will continue to be given access to Company’s
customers and other business relationships.




     2. Termination of Employment. Company and Employee acknowledge and agree
that Employee’s employment is on an at-will basis, and, accordingly, either
Company or Employee may terminate the employment relationship at any time for
any reason, or no reason whatsoever, with or without cause, and without advance
notice.



     3. Non-Disclosure of Confidential Information. Employee acknowledges that
Confidential Information is a valuable, special, and unique asset of Company,
Parent and the Affiliates and agrees to the following:




(A) Confidential Information Defined. The term “Confidential
Information” includes, but is not limited to, any and all of
Company’s, Parent’s or Affiliates’ trade secrets, confidential and
proprietary information and all other information and data of
Company that is not generally known to the public or other third
parties who could derive economic value from its use or disclosure.
Confidential Information includes, without limitation, the
following: i) marketing, sales, and advertising information such
as lists of actual or potential customers; customer preference
data; marketing and sales techniques, strategies, efforts, and
data; merchandising systems and plans; confidential customer
information including identification of purchasing personnel,
account status, needs and ability to pay; business plans; product
development and delivery schedules; market research and forecasts;
marketing and advertising plans, techniques, and budgets; overall
pricing strategies; the specific advertising programs and
strategies utilized, and the success or lack of success of those
programs and strategies; ii) organizational information such as
personnel and salary data; merger, acquisition and expansion
information; information concerning methods of operation;
divestiture information; and competitive information pertaining to
Company’s distributors; iii) financial information such as product
costs; supplier information; overhead costs; profit margins;
banking and financing information; and pricing policy practices;
iv) technical information such as product specifications,
compounds, formulas, improvements, discoveries, developments,
designs, inventions, techniques, new products and surgical training
methods; v) information disclosed to Employee as part of a training
process; and vi) information of third parties provided to Employee
subject to non-disclosure restrictions for use in Employee’s
business for Company. Confidential Information also includes any
work product created by Employee in rendering services for Company.




(B) Non-Disclosure of Confidential Information. Employee agrees
that Employee will not disclose, transfer, or use (or seek to
induce others to disclose,



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transfer, or use) any Confidential Information for any purpose
other than i) disclosure to authorized employees and agents of
Company who are bound to maintain the confidentiality of the
Confidential Information; and/or ii) for authorized purposes during
the course of Employee’s employment in furtherance of Company’s
business.




(C) Protection of Confidential Information. Employee will notify
Company in writing of any circumstances which may constitute
unauthorized disclosure, transfer, or use of Confidential
Information. Employee will use best efforts to protect
Confidential Information from unauthorized disclosure, transfer, or
use. Employee will implement and abide by all procedures adopted
by Company to prevent unauthorized disclosure, transfer, or use of
Confidential Information.




	4.	 	Ownership of Confidential Information and Inventions.






(A) Invention Defined. The term “Invention” includes, but is not
limited to ideas, programs, processes, systems, intellectual
property, copyrightable materials, discoveries, and/or improvements
of which Employee conceives alone or in conjunction with others
during Employee’s employment with Company and/or within six (6)
months after Employee’s employment ends which relate to Company’s
present or future business. An Invention is covered by this
Agreement regardless of whether i) Employee conceived of the
Invention in the scope of Employee’s employment; or ii) the
Invention is patentable.




(B) Ownership of Confidential Information and Inventions.
Confidential Information and Inventions are solely the property of
Company. Employee agrees that Employee does not have any rights,
title, or interest in any of the Confidential Information or
Inventions.




(C) Disclosure and Assignment of Inventions. Employee will,
without royalty or other consideration: i) inform Company promptly
and fully of each Invention in writing with a detailed description
of each Invention; ii) assign, and hereby does assign, to Company
all of Employee’s right, title and interest in and to each
Invention; and iii) execute at Company’s request and expense, any
and all applications, assignments, or other documents relating to
any Invention and the process of obtaining any patents or other
protection for any Invention.



     5. Return of Confidential Information and Company Property. Immediately
upon termination of Employee’s employment with Company, Employee shall return
to Company all of Company’s property relating to Company’s business, including
without limitation all of Company’s property which is in the possession,
custody, or control of Employee such as Confidential Information, documents,
hard copy files, copies of documents and electronic information/files.



     6. Obligations to Other Entities or Persons. Employee warrants that
Employee is not bound by the terms of a confidentiality agreement or any other
legal obligation which would



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either preclude or limit Employee from disclosing or using any of Employee’s
ideas, inventions, discoveries or other information or otherwise fulfilling
Employee’s obligations to Company. While employed by Company, Employee shall
not disclose or use any Confidential Information belonging to an entity or
other person.




     7. Conflict of Interest and Duty of Loyalty. During Employee’s employment
with Company, Employee shall not engage, directly or indirectly, in any
activity, employment or business venture, whether or not for remuneration, that
is i) competitive with Company’s business; ii) deprives or potentially could
deprive Company of any business opportunity; iii) conflicts or potentially
could conflict with Company’s business interests; or iv) is otherwise
detrimental to Company, including but not limited to preparations to engage in
any of the foregoing activities.



     8. Non-Competition Covenants. Company and Employee acknowledge and agree
that the following non-competition covenants are reasonable and necessary to
protect the legitimate interests of Company, Parent and Affiliates, including,
without limitation, the protection of Confidential Information, and Inventions.
Employee further acknowledges and agrees that such covenants are an essential
part of and consideration for Company’s promises contained in this Agreement.
Employee agrees to, and covenants to comply with, each of the following
separate and divisible restrictions:




	(A)	 	Definitions.






1. “Competing Product” is defined as any orthopaedic product,
process, or service and any dental reconstructive implant,
spine implant, and trauma product; and/or any new product
formulation, product modification, and/or product improvement
which Company, Parent and/or Affiliate researched, developed,
manufactured, marketed, distributed, and/or sold at the time
of Employee’s termination and which Employee worked in
conjunction with or obtained technical knowledge of during
the last two years of Employee’s employment.




2. “Competing Organization” is defined as any organization
that researches, develops, manufactures, markets, distributes
and/or sells one or more Competing Products or has plans to
research, develop, manufacture, market, distribute, and/or
sell one or more Competing Products. A “Competing
Organization” is diversified if it controls or is in common
control of entities which conduct business in an industry
other than the orthopaedic products industry or the dental
reconstructive, spine implant or trauma products industries.




3. “Same or Similar Capacity” is defined as: i) the same or
similar capacity or function in which the Employee worked for
Company at any time during the last two years of Employee’s
employment; ii) any executive or managerial capacity; and/or
iii) any other capacity in which Employee’s knowledge of
Confidential Information and/or Inventions



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would render Employee’s assistance to a Competing
Organization a competitive advantage.




4. “Restricted Geographic Area” is defined as the following:
i) Switzerland; ii) the continental United States; iii)
Canada; iv) Mexico; v) Japan; vi) all countries of the
European Union; and vii) all other countries, territories, or
states in which a) Company is doing business or is selling
its products at the time of termination of Employee’s
employment with Company; and b) the Parent is doing business
or is selling its products at the time of termination of
Employee’s employment with Company.




5. “Non-Competition Period” is defined as the date Employee
executes this Agreement, continuing through the twelve (12)
months after the Employee’s last day of employment with
Company unless otherwise extended by Employee’s breach of
this Agreement.




6. “Customer” is defined as any distributor, health care
dealer, hospital, hospital system, university practitioner,
surgeon, dentist, health care purchasing organization, or
surgical group with whom Employee had a business relationship
on behalf of Company during the last two years of Employee’s
employment with Company, and/or any distributor, health care
dealer, hospital, hospital system, university practitioner,
surgeon, dentist, health care purchasing organization, or
surgical group with whom Company had a business relationship
during the last two years of Employee’s employment with
Company.




7. “Potential Customer” is defined as any entity that
Employee identified, marketed to, and/or held discussions
with regarding the research, development, manufacture,
distribution, and/or sale of one or more Competing Products
during the last two years of Employee’s employment with
Company, and/or any entity that Company identified, marketed
to, and/or held discussions with regarding the research,
development, manufacture, distribution, and/or sale of one or
more Competing Products during the last two years of
Employee’s employment with Company.




	(B)	 	Restrictive Covenants. During the Non-Competition Period,
Employee agrees to be bound by each of the following independent
and divisible restrictions:






1. Employee will not seek or obtain employment, work for,
consult with, or lend assistance to any Competing
Organization in a Same or Similar Capacity in the Restricted
Geographic Area.



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2. Employee will not seek or obtain employment, work for,
consult with, or lend assistance to any Competing
Organization in a Same or Similar Capacity or in any capacity
if it is likely that as part of such capacity, Employee would
inevitably use and/or disclose any of Company’s Confidential
Information and/or Inventions.




3. Employee may accept employment, work for, consult with, or
lend assistance to any Competing Organization provided that:
i) the Competing Organization’s business is diversified; ii)
the part of the Competing Organization’s diversified business
with which Employee will be affiliated is not the same part
of Company’s business with which Employee was affiliated
during the last two years of Employee’s employment with
Company; iii) the Employee’s affiliation with the Competing
Organization does not involve any Competing Products; iv)
Employee provides Company with a written description of
Employee’s anticipated activities on behalf of the Competing
Organization which includes, without limitation, an assurance
satisfactory to Company that Employee’s affiliation with the
Competing Organization does not constitute a Same or Similar
Capacity; v) Employee’s affiliation with the Competing
Organization would not likely cause Employee to inevitably
use and/or disclose any Confidential Information and/or
Inventions; and vi) Employee’s affiliation with the Competing
Organization has no competitive purpose.




4. Employee will not seek or obtain employment, work for,
consult with, or lend assistance to any Customers or
Potential Customers in the Restricted Geographic Area in a
competitive capacity or for a competitive purpose.




5. Employee will not provide, sell, market, or endeavor to
provide, sell, or market one or more Competing Products to
any Customer, or otherwise solicit or communicate about any
Competing Products in a competitive capacity or for a
competitive purpose with any Customer in the Restricted
Geographic Area.




6. Employee will not provide, sell, market, or endeavor to
provide, sell, or market one or more Competing Products to
any Potential Customer, or otherwise solicit or communicate
about any Competing Products in a competitive capacity or for
a competitive purpose with any Potential Customer in the
Restricted Geographic Area.




7. Employee will not adversely interfere with past, present,
or prospective business relationships between Company and any
of its Customers, Potential Customers, suppliers,
distributors, agents, sales representatives, employees,
independent contractors, or other persons or entities with
which Company, Parent and/or Affiliates deal.



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8. Employee will not employ, engage in personal service or
favor (whether or not compensated), solicit for employment,
advise or recommend to any other person or entity that such
person or entity employ, or solicit for employment, any
individual now or hereafter employed by Company, or otherwise
induce or entice any such employee to leave Employee’s
employment with Company to work for, consult with, or lend
assistance to any Competing Organization.




9. Employee agrees to refrain from making any disparaging or
derogatory statements about Company, its products, Parent and
any of the Affiliates, together with their past, present and
future officers, directors, employees, attorneys and agents.
Disparaging or derogatory statements include, but are not
limited to, negative statements regarding Company’s business
or other practices.




10. Employee agrees that the divisible covenants contained in
this Agreement prohibit Employee from engaging in the
restricted activities directly or indirectly, whether on
Employee’s behalf or on behalf of or for the benefit of any
other person or entity, including for Employee’s benefit, and
that all of the covenants restrict him from engaging in
activities for a competitive purpose.




11. The Non-Competition Period shall not expire during any
period in which Employee is in violation of any of the
restrictive covenants set forth herein, and all restrictions
shall automatically be extended by the period Employee was in
violation of any such restrictions.



     9. Reasonableness of Terms. Employee acknowledges and agrees that the
restrictive covenants contained in this Agreement are reasonably necessary to
protect Company’s, Parent’s and Affiliates’ legitimate interests in
Confidential Information, Inventions, and goodwill. Additionally, Employee
acknowledges and agrees that the restrictive covenants are reasonable in all
respects, including, but not limited to, temporal duration, scope of prohibited
activities and geographic area. Employee further acknowledges and agrees that
the restrictive covenants set forth in this Agreement will not pose any
hardship on Employee and that Employee will reasonably be able to earn an
equivalent livelihood without violating any provision of this Agreement.



     10. Non-Competition Period Payments. In the event Company terminates
Employee and it is a “Termination for Cause” (as defined below), the payment
provisions of this section 10 shall not apply. Following a termination of
employment other than a Termination for Cause, to the extent Employee is unable
to obtain employment consistent with Employee’s training and education solely
because of the provisions of this Agreement, the following terms will apply
upon expiration of any severance benefits to which Employee is otherwise
eligible to receive: i) Company will make payments to Employee equal to
Employee’s monthly base pay at the time of Employee’s termination plus bonus
paid at target for each month of such



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unemployment through the end of the Non-Competition Period; ii) to the extent
Employee is able to obtain employment which does not violate this Agreement,
but solely because of this Agreement, the monthly base pay including the
pro-rata bonus payment for the replacement employment is less than Employee’s
monthly base pay including the pro-rata bonus payment at the time of Employee’s
termination, Company agrees to pay the difference for each such month through
the end of the Non-Competition Period; and iii) on the 15th day of each month
of such unemployment, Employee will give Company a detailed written account of
Employee’s efforts to obtain employment and an explanation exclusively
attributing Employee’s inability to obtain replacement employment to the
provisions of this Agreement. To the extent that Employee breaches any
provision of this Agreement during the Non-Competition Period and/or fails to
timely submit the written account required by this Section 10, Company reserves
the right to cease making any payments pursuant to this Section 10. In the
event of Employee’s breach, Employee agrees that Employee will still be bound
by all of the provisions set forth in this Agreement, including, but not
limited to, the non-competition, non-solicitation, non-disparagement and
non-disclosure covenants, until the end of the Non-Competition Period.
Further, Company reserves the right to release Employee from Employee’s
obligations set forth in this Agreement at any time during the Non-Competition
Period, at which time Company’s payment obligations under this Section 10 shall
cease immediately and Employee shall not be entitled to any Non-Competition
Period Payments or other compensation.



Furthermore, except in the event of a Termination for Cause, the Employee is
entitled to all contractual pension, insurance, benefits contributions for the
duration of the Non-Competition Period or until the Employee is able to obtain
employment, whatever happens first.



“Termination for Cause” means if Employee: (a) is convicted of or pleads guilty
or nolo contendere to any felony or to any crime or offense causing substantial
harm to the Company or any of its affiliates (whether or not for personal gain)
or involving acts of theft, fraud, embezzlement, moral turpitude or similar
conduct; (b) is grossly negligent or exercises willful misconduct in the
performance of the duties of Employee; (c) fails or refuses to comply with
policies or directives of the President, Chairman, CEO, or Board of Directors
which are consistent with the nature of Employee’s duties hereunder and the
provisions of this Agreement; (d) materially breaches any obligation of
Employee set forth in this Agreement or in any other agreement between employee
and the Company; or (e) commits any act or omission which reflects adversely on
the Company. In the event of Termination for Cause, (i) the Company shall not
have any further liability or obligation to Employee other than any unpaid base
salary, to the extent already earned or accrued as of his termination date,
minus any liabilities that Employee may have to the Company; (ii) Employee
shall not be entitled to receive any incentive compensation or bonus for that
year or any portion of that year during which the Termination for Cause occurs;
and (iii) all previously granted stock options will terminate and not be
exercisable.




     11. Severability, Modification of Restrictions: The covenants and
restrictions in this Agreement are separate and divisible, and to the extent
any clause, portion or section of this Agreement is determined to be
unenforceable or invalid for any reason, Company and Employee acknowledge and
agree that such unenforceability or invalidity shall not affect the
enforceability or validity of the remainder of the Agreement. If any
particular covenant, provision or clause of this Agreement is determined to be
unreasonable or unenforceable for any reason, including,



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without limitation, the temporal duration, scope of prohibited activity, and/or
geographic area covered by any non-competition, non-solicitation,
non-disparagement or non-disclosure covenant, provision or clause, Company and
Employee acknowledge and agree that such covenant, provision or clause shall
automatically be deemed reformed such that the contested covenant, provision or
clause will have the closest effect permitted by applicable law to the original
form and shall be given effect and enforced as so reformed to whatever extent
would be reasonable and enforceable under applicable law. The parties agree
that any court interpreting the provisions of this Agreement shall have the
authority, if necessary, to reform any such provision to make it enforceable
under applicable law.




     12. Remedies. Employee acknowledges that a breach or threatened breach by
Employee of this Agreement will give rise to irreparable injury to Company and
that money damages will not be adequate relief for such injury. Accordingly,
Employee agrees that Company shall be entitled to obtain injunctive relief,
including, but not limited to, temporary restraining orders, preliminary
injunctions and/or permanent injunctions, without having to post any bond or
other security, to restrain or prohibit such breach or threatened breach, in
addition to any other legal remedies which may be available. In addition to
all other relief to which it shall be entitled, Company shall be entitled to
cease all payments to which Employee would otherwise be entitled under Section
10 hereto; continue to enforce this Agreement; recover from Employee all
payments made under Section 10 to the extent attributable to a time during
which Employee was in violation of the covenants for which payment was made;
and recover from Employee all litigation costs and attorneys’ fees incurred by
Company in any action or proceeding relating to this Agreement in which Company
prevails, including, but not limited to, any action or proceeding in which
Company seeks enforcement of this Agreement or seeks relief from Employee’s
violation of this Agreement.



     13. Survival of Obligations. Employee acknowledges and agrees that
Employee’s obligations under this Agreement, including, without limitation,
Employee’s non-disclosure and non-competition obligations, shall survive the
termination of Employee’s employment with Company, whether or not such
termination is with or without cause or whether or not it is voluntary or
involuntary. Employee further acknowledges and agrees that Employee’s
non-disclosure, non-disparagement, non-solicitation and non-competition
covenants set forth in Sections 3 and 8 of this Agreement shall be construed as
independent covenants and that no breach of any contractual or legal duty by
Company shall be held sufficient to excuse or terminate the Employee’s
obligations under Sections 3 and 8 of this Agreement or to preclude Company
from obtaining injunctive relief or other remedies for Employee’s violation or
threatened violation of such covenants.



     14. Successors and Assigns. Company shall have the right to assign this
Agreement, and, accordingly, this Agreement shall inure to the benefit of, and
may be enforced by, any and all successors and assigns of Company, including
without limitation by asset assignment, stock sale, merger, consolidation or
other corporate reorganization, and shall be binding on Employee, Employee’s
executors, administrators, personal representatives or other successors in
interest. The services to be provided by Employee to Company are personal to
the Employee, and Employee shall not have the right to assign Employee’s duties
under this Agreement.



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     15. Modification. This Agreement may not be amended, supplemented, or
modified except by a written document signed by both Employee and a duly
authorized officer of Company.



     16. No Waiver. The failure of Company to insist in any one or more
instances upon performance of any of the provisions of this Agreement or to
pursue its rights hereunder shall not be construed as a waiver of any such
provisions or the relinquishment of any such rights.



     17. Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original, but both of which when taken together will
constitute one and the same agreement.



     18. Entire Agreement. This Agreement, including Recitals, constitutes the
entire agreement of the parties with respect to the subjects specifically
addressed herein, and supersedes any prior agreements, understandings, or
representations, oral or written, on the subjects addressed herein, excluding
the Employment Agreement Employee executed when Employee’s employment
commenced. Notwithstanding the foregoing, to the extent the employee has an
existing non-competition, confidentiality, and/or non-solicitation agreement in
favor of Company and has breached or violated the terms thereof, Company may
continue to enforce its rights and remedies under and pursuant to such existing
agreement.



     Employee’s signature below indicates that Employee has read the entire
Agreement, Employee understands what Employee is signing, and is signing it
voluntarily. Employee agrees that Company advised Employee to consult with an
attorney prior to signing the Agreement.



Date: September 30, 2004




	 	 	 
	

	 	“COMPANY”
	 
	 	 
	`

	 	Zimmer GmbH
	 
	 	 
	

	 	By:


	

	 	Printed
Name:


	

	 	Title:


	 
	 	 
	

	 	“EMPLOYEE”
	 
	 	 
	

	 	









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