Exhibit 10.3


 


SUPPLY
AGREEMENT


 


This
SUPPLY AGREEMENT (this “Agreement”), is entered into as of [•], 2014 (the “Effective Date”) between Symmetry
Medical Inc., a Delaware corporation (the “Company”), and Racecar SpinCo, Inc., a Delaware corporation (“SpinCo”).
Company and SpinCo are referred to herein collectively as the “Parties,” and each individually as a “Party”.


 


WHEREAS,
the Parties have entered into that certain Separation Agreement, dated as of August 4, 2014 (the “Separation Agreement”);


 


WHEREAS,
pursuant to the terms of the Separation Agreement, the Parties have effected a separation of the OEM Solutions Business, which
remains with the Company, and the Symmetry Surgical Business, which has been conveyed to and vested in SpinCo (the “Separation”);


 


WHEREAS,
the Parties desire to enter into this Agreement in order to provide for a continued supply of Products following the Separation,
continuing on substantively similar terms and conditions that presently exist, and as set forth herein;


 


NOW,
THEREFORE, in consideration of the mutual promises, covenants and agreements hereinafter set forth, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledge, and intending to be legally bound hereby, the Parties
hereby agree as follows:


 


		1.	DEFINITIONS. Capitalized terms
                                         used herein but not otherwise defined shall have the meanings set forth in the Separation
                                         Agreement. As used throughout this Agreement, each of the following terms shall have
                                         the respective meaning set forth below:



 


		a.	“Actual Order”
                                         has the meaning set forth in Section 4(b).



 


		b.	“Agreement”
                                         has the meaning set forth in the Preamble.



 


		c.	“Bankruptcy Code”
                                         has the meaning set forth in Section 6(b).



 


		d.	“Bankruptcy Laws”
                                         has the meaning set forth in Section 6(b).



 


		e.	“Code” shall
                                         mean the Internal Revenue Code of 1986, as amended from time to time.



 


		f.	“Company Product”
                                         shall mean those Products listed on Schedule A to this Agreement, manufactured
                                         and packaged in accordance with the Specifications, along with any Improvements thereto,
                                         and supplied to SpinCo by Company. Company Products may be added or removed from Schedule
                                         A by prior written agreement between the Parties.



 


		g.	“Corrective Action”
                                         shall mean any Recall, field alert, product withdrawal, or other field or similar action
                                         relating to a Product (or any finished product containing or contained in such Product).



 


		h.	“Damages” has
                                         the meaning set forth in Section 14(a).



 


		i.	“Defective Product”
                                         has the meaning set forth in Section 8(a).



 


 




    	





    	 



    

 


		j.	“Effective Date”
                                         has the meaning set forth in the Preamble.



 


		k.	“Excise Tax”
                                         has the meaning set forth in Section 7(b)(i).



 


		l.	“Expected Order”
                                         has the meaning set forth in Section 4(a).



 


		m.	“Failure to Supply”
                                         has the meaning set forth in Section 10(b).



 


		n.	“Firm Order”
                                         has the meaning set forth in Section 4(a).



 


		o.	“Force Majeure Event”
                                         has the meaning set forth in Section 10(a).



 


		p.	“Forecast” has
                                         the meaning set forth in Section 4(a).



 


		q.	“Governmental Authority”
                                         shall mean any governmental department, commission, board, bureau, agency, court or other
                                         instrumentality having any jurisdiction over the manufacturing, use, marketing, sale
                                         or distribution of the Products.



 


		r.	“Improvement”
                                         shall mean any change, improvement, modification or development to the Products, the
                                         Specifications, the Raw Materials or the method or process of manufacture or production
                                         of the Products.



 


		s.	“Indemnity Claim”
                                         shall mean either a Receiving Party Claim or a Supplying Party Claim, as the context
                                         requires.



 


		t.	“Intellectual Property”
                                         shall mean the intellectual property, trade secrets, know-how, technology and information,
                                         whether or not protected by patents, that are required in order to make any Product.



 


		u.	“Latent Defect”
                                         has the meaning set forth in Section 8(a).



 


		v.	“Party” and
                                         “Parties” has the meaning set forth in the Preamble.



 


		w.	“Products” shall
                                         mean Company Products and SpinCo Products collectively.



 


		x.	“Raw Materials”
                                         shall mean the materials, components, and packaging required to manufacture and package
                                         the Products in accordance with the Specifications.



 


		y.	“Recall” shall
                                         mean a removal, safety alert, or other field correction, whether ordered by a Governmental
                                         Authority or initiated by a Party, of a Product that a Governmental Authority would consider
                                         to be in violation of the laws it administers and against which a Governmental Authority
                                         would initiate legal action or which the Company or SpinCo, respectively believes does
                                         not conform to Product Specifications in such a manner that it could pose a risk to human
                                         health or safety.



 


		z.	“Receiving Party” shall mean the party receiving Products hereunder from the Supplying Party. Either Party may be the Receiving Party,
as the context requires.



 


		aa.	“Receiving Party Claim”
                                         has the meaning set forth in Section 14(d).



 




    	





    	 



    

 


		bb.	“RMA” has the
                                         meaning set forth in Section 8(b).



 


		cc.	“Separation”
                                         has the meaning set forth in the Recitals.



 


		dd.	“Separation Agreement”
                                         has the meaning set forth in the Recitals.



 


		ee.	“Specifications”
shall mean the specifications for the design, composition, product safety assurance, manufacture, packaging, shipping and/or quality
control of the Products, as set forth in the Quality Agreement.1



 


		ff.	“SpinCo” has
                                         the meaning set forth in the Preamble.



 


		gg.	“SpinCo Product”
                                         shall mean those Products listed on Schedule B to this Agreement, manufactured
                                         and packaged in accordance with the Specifications, along with any Improvements thereto,
                                         and supplied to Company by SpinCo. SpinCo Products may be added or removed from Schedule
                                         B by prior written agreement between the Parties.



 


		hh.	“Supplying Party Claim”
                                         has the meaning set forth in Section 14(c).



 


		ii.	“Transfer Taxes”
                                         has the meaning set forth in Section 7(b)(i).



 


		jj.	“Term” has
                                         the meaning set forth in Section 5.



 


		kk.	“Supplying Party”
                                         shall mean the party supplying Products hereunder to the Receiving Party. Either
                                         Party may be the Supplying Party, as the context requires.



 


		ll.	“VAT” shall
                                         mean value added tax imposed in any member state of the European Union pursuant to Council
                                         Directive (EC) 2006/112 on the common system of value added tax and national legislation
                                         implementing that Directive or any predecessor to it, or supplemental to that Directive,
                                         or any similar tax which may be substituted for or levied in addition to it or any value
                                         added, sale turnover or similar tax imposed in a country which is not a member of the
                                         European Union.



 


		mm.	“Withholding Taxes”
                                         has the meaning set forth in Section 7(b)(ii).



 


		2.	SUPPLY OF PRODUCT. Commencing
                                         on the Effective Date and continuing through the Term, the Parties shall supply each
                                         other with those quantities of Products as ordered by each respectively pursuant to this
                                         Agreement, subject to the ordering procedures set forth in Section 4 below. Each
                                         Product sold hereunder will conform to the Specifications for such Product.



 





 






1
Prior to the Closing, the Company will provide Parent with such access to the Product specifications as Parent may reasonably
request or as may otherwise be reasonably required to comply with the Quality Agreement.


 




    	

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		3.	PRICES FOR PRODUCT



 


		a.	Prices. The Prices for each
                                         Product shall be (i) for the first two (2) years of the term of this Agreement, equal
                                         to the transfer prices, as set forth on Schedule A (under the heading “Current
                                         OEM Avg Selling Price to Symm Surg”) and Schedule B respectively and (ii) for the
                                         final three (3) years of the term of this Agreement, as set forth on Schedule A (under
                                         the heading “Revised OEM Selling Price (Cost + 25%)”). Prices include delivery
                                         costs; the Supplying Party shall ship the Product via the means necessary to ensure product
                                         is delivered by the delivery date set forth in the Purchase Order.



 


		b.	Payment Terms. Payment terms
                                         on all invoices shall be forth five (45) days of receipt of the invoice related to any
                                         shipment of Products and all payments shall be in U.S. Dollars and paid by wire or electronic
                                         transfer to the bank account(s) directed by the Supplying Party. Interest on overdue
                                         payments shall be charged from the due date at a rate of eight percent (8%) per annum.
                                         Invoices shall be issued after delivery of the Products.



 


		c.	Increased Volume. To the
                                         extent that the monthly quantity of any Product purchased by either Party hereunder exceeds
                                         the average monthly inter-company purchases for the twelve (12) months prior to the Effective
                                         Date, and such increased volume directly results in cost efficiencies on the part of
                                         the Supplying Party which reduce the Supplying Party’s internal cost of manufacturing
                                         such Product, then the Supplying Party shall use commercially reasonable good faith efforts
                                         to pass one-half of such cost efficiencies on to the Receiving Party by reducing the
                                         Price of such Product to the reflect such reduction in internal costs.



 


		4.	FORECASTS, PURCHASE ORDERS



 


		a.	Forecasts. At the beginning
                                         of each calendar month during the term of this Agreement, each Party shall provide the
                                         other with a six (6) month delivery schedule of Products (a “Forecast”),
                                         where the first two (2) months of deliveries are firm (a “Firm Order”)
                                         and the following four (4) months represents the expected requirements (an “Expected
                                         Order”) for Product. Both Parties will work in good faith to establish a vendor
                                         managed replenishment system for frequently ordered products and provide demand visibility
                                         of twelve (12) months as part of the initiative.



 


		b.	Orders. The Supplying Party
                                         shall supply Product(s) pursuant to written purchase orders submitted by the Receiving
                                         Party identifying the quantity of Product(s) ordered, required delivery date(s) and any
                                         other terms proposed. The Supplying Party shall accept the purchase order(s) consistent
                                         with Firm Orders or, with respect to any other purchase orders, accept such purchaser
                                         order or propose alternative terms within three (3) days of receipt of the purchase order(s).



 


		c.	No Minimum Orders. Nothing
                                         in this Agreement shall be construed as requiring the Receiving Party to place Firm Orders
                                         in any minimum quantity or to purchase all of its requirements from the Supplying Party,
                                         nor shall the Supplying Party be deemed the exclusive supplier to the Receiving Party
                                         with respect to any Product.



 




    	

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		5.	TERM. The term of this Agreement (the “Term”)
                                         shall commence on the Effective Date and remain in effect for a period of five (5) years,
                                         unless sooner terminated as expressly provided under the terms of this Agreement.



 


		6.	TERMINATION



 


		a.	Termination for Breach.
                                         Notwithstanding anything to the contrary herein, either party may terminate this Agreement
                                         by giving written notice of its intent to terminate and stating the grounds therefor
                                         if the other party shall materially breach or materially fail in the observance or performance
                                         of any representation, warranty, guarantee, covenant or obligation under this Agreement.
                                         The party receiving the notice shall have thirty (30) days from the date of receipt thereof
                                         to cure the breach or failure. In the event such breach or failure is cured, the notice
                                         shall be of no effect. If the breach or failure is not cured then termination is effective
                                         on the thirty-first (31st) day after notice of the breach or failure is given.



 


		b.	Termination for Insolvency,
                                         Etc. This Agreement may be terminated upon fifteen (15) days written notice by either
                                         Party to the other: (i) in the event that the other Party shall (A) apply for or
                                         consent to the appointment of, or the taking of possession by, a receiver, custodian,
                                         trustee or liquidator of itself or of all or a substantial part of its property, (B) make
                                         a general assignment for the benefit of its creditors, (C) commence a voluntary
                                         case under the United States Bankruptcy Code (the “Bankruptcy Code”),
                                         as now or hereafter in effect, (D) file a petition seeking to take advantage of
                                         any law relating to bankruptcy, insolvency, reorganization, winding-up, or composition
                                         or readjustment of debts (the “Bankruptcy Laws”), (E) fail to controvert
                                         in a timely and appropriate manner, or acquiesce in writing to, any petition filed against
                                         it in any involuntary case under the Bankruptcy Code, or (F) take any corporate
                                         action for the purpose of effecting any of the foregoing; or (ii) if a proceeding or
                                         case shall be commenced against the other Party in any court of competent jurisdiction,
                                         seeking (A) their liquidation, reorganization, dissolution or winding-up, or the
                                         composition or readjustment of its debts, (B) the appointment of a trustee, receiver,
                                         custodian, liquidator or the like of the Party or of all or any substantial part of their
                                         assets, or (C) similar relief under any Bankruptcy Laws, or an order, judgment or
                                         decree approving any of the foregoing shall be entered and continue unstayed for a period
                                         of sixty (60) days; or an order for relief against the other party hereto shall be entered
                                         in an involuntary case under the Bankruptcy Code.



 


		c.	Effect of Termination. Termination
                                         or expiration of this Agreement for any reason shall not release either party hereto
                                         from any liability which at such time has already accrued or which thereafter accrues
                                         from a breach or default prior to such expiration or termination, nor affect in any way
                                         the survival of any other right, duty or obligation of either party hereto which is expressly
                                         stated elsewhere in this Agreement to survive such termination. In the case of a termination
                                         under Section 6(a) above, the non-defaulting Party may pursue any remedy available
                                         in law or in equity with respect to such breach, subject to the terms hereof regarding
                                         dispute resolution.



 


		7.	DELIVERY; INVENTORY.



 


		a.	Delivery. All charges for
                                         packing, hauling, storage, bar coding, and transportation to point of delivery of Products
                                         are included in the Price unless otherwise agreed to by the Parties. Point of delivery
                                         is the Supplying Party’s shipping dock. All shipments must be accompanied by a
                                         packing slip which describes the Products, states the purchase order number and shows
                                         the shipment’s destination. The Supplying Party agrees to promptly forward the
                                         original bill of lading or other shipping receipt for each shipment in accordance with
                                         the Receiving Party’s instructions. The Supplying Party further agrees to promptly
                                         render, after delivery of the Products, correct and complete invoices to the Receiving
                                         Party.



 




    	

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		b.	Taxes. (i) The Receiving
                                         Party shall be responsible for the payment of all applicable sales, VAT (including any
                                         amounts in respect of VAT), value added, ad valorem, use, stamp, transfer, recording,
                                         documentary, filing and any and all similar, taxes or governmental fees (“Transfer
                                         Taxes”). Excise Taxes (including any excise tax imposed on the sale of certain
                                         medical devices under Section 4191 of the Code) shall be borne by the party legally required
                                         to pay such tax pursuant to the Code (“Excise Taxes”).



 


(ii)
Each payment made by the Receiving Party under this Agreement shall be made without withholding or deduction for Taxes, unless
such withholding or deduction is required by law.


 


(iii)
Each Party shall provide the other Party with proper evidence of the remittance of Transfer Taxes, Excise Taxes or Withholding
Taxes, as the case may be, to the appropriate taxing authority. The Parties shall reasonably cooperate to timely file or cause
to be filed all necessary documents (including all tax returns) with respect to Transfer Taxes or Withholding Taxes. The Parties
will cooperate fully with each other and take all commercially reasonable steps to legitimately obtain a reduction or elimination
of, or credit for, any Transfer Taxes, Excise Taxes or Withholding Taxes, to the extent permitted by the Code, or other applicable
Law, arising in connection with the transactions contemplated by this Agreement.


 


		c.	Shipment. The title and
                                         risk of loss with respect to any Product shall remain with the Supplying Party until
                                         such Product is delivered to the Supplying Party’s shipping dock, at which point
                                         it shall shift to the Receiving Party. The Supplying Party will pack all Product ordered
                                         hereunder in a manner suitable for shipment and sufficient to enable the Product to withstand
                                         the effects of shipping, including handling during loading and unloading. The cost of
                                         delivery of Products is not included in the Price and will be added to the invoice for
                                         each shipment unless the Receiving Party pays the shipper directly for shipment through
                                         use of its shipper number or otherwise.



 


		d.	Delivery Dates. Any Products
                                         delivered prior to the date designated in the Purchase Order (the “Delivery
                                         Date”) may be returned to Supplying Party by Receiving Party at Supplying Party’s
                                         expense and re-shipped at Supplying Party’s expense on the correct Delivery Date.
                                         Should Supplying Party fail to deliver any Products on the Delivery Date then Receiving
                                         Party may, at its option, cancel a portion or all of the Purchase Order, with no liability
                                         to Supplying Party.



 


		8.	INSPECTION AND RETURNS



 


		a.	Inspections. Receiving Party
                                         shall inspect the Products within sixty (60) days of receipt and, within that time shall
                                         notify the Supplying Party of any nonconformity with any Products.



 




    	

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		b.	Returns of Defective Products.
                                         Returns of Products are only accepted in the event the Products are not in substantial
                                         compliance with Specifications as set forth in the Quality Agreement (a “Defective
                                         Product”). Failure of the Receiving Party to provide written notice of an alleged
                                         Defective Product that is evident upon examination within sixty (60) days of receipt
                                         of the Product shall constitute acceptance of the Products, except to the extent any
                                         such defect is not evident upon examination (a “Latent Defect”). 
                                         The Receiving Party shall notify the Supplying Party of any Latent Defects within fifteen
                                         (15) business days of discovery thereof.



 


		c.	Resolution. If the Receiving
                                         Party provides notice of Defective Products in accordance with Section 8(a), then
                                         the Supplying Party shall communicate with the Receiving Party to attempt resolution
                                         without the need to return the Defective Products.  If the foregoing discussions
                                         do not resolve the matter then the Supplying Party shall provide the Receiving Party
                                         with a Returned Material Authorization (“RMA”) number which must be
                                         used to return the Defective Products to the Supplying Party for evaluation. Upon receipt
                                         of the Defective Products, the Supplying Party shall, within thirty (30) days of receipt,
                                         evaluate them to determine if they do not conform to the Specifications.  In the
                                         event the Supplying Party concurs that the Defective Products are out of conformance
                                         with the Specifications then the Supplying Party shall, at Receiving Party’s option,
                                         shall either: i) promptly repair the Defective Products
                                         so that they are no longer Defective Products, or ii) replace the Defective
                                         Products with non-Defective Products (provided that the Receiving Party shall
                                         pay for such repaired or replaced Product in full in accordance with the terms of this
                                         Agreement, with such payment not resulting in a payment by the Receiving Party in excess
                                         of the Price of the Defective Products) or (iii) refund the price paid for the Defective
                                         Products.  If the Parties determine that the allegedly Defective Products conform
                                         to the Specifications, the Supplying Party will return the Products to the Receiving
                                         Party at the Receiving Party’s expense. The foregoing shall be in addition to any
                                         rights to Damages that Receiving Party may recover from the Supplying Party as a result
                                         of its delivery of the Defective Products.



 


		9.	CORRECTIVE ACTIONS.



 


		a.	Reporting. Unless otherwise
                                         set forth in the Quality Agreement, the Receiving Party shall be solely responsible in
                                         accordance with applicable Laws for the reporting to the relevant Governmental Authority
                                         of any complaints or Corrective Action relating to any Product which arise for any reason.
                                         Each Party shall promptly inform the other Party of any notification or other information
                                         affecting the marketability, safety, or effectiveness of a Product.



 


		b.	Administration of Corrective
                                         Actions. If the Receiving Party or any Governmental Authority deems that a Corrective
                                         Action is warranted, the strategy in respect of such Corrective Action shall be developed
                                         by the Receiving Party and such Corrective Action shall be implemented and administered
                                         by the Receiving Party in a manner which is appropriate and reasonable under the circumstances
                                         and in conformity with accepted trade practices and applicable Laws. The Supplying Party
                                         shall reasonably cooperate with any such Corrective Action. The Receiving Party shall
                                         be responsible for any customer communications it deems necessary with regard to customer
                                         complaints (at its own expense) and shall promptly provide a written copy of any such
                                         communications to the Supplying Party; provided, that the Receiving Party shall
                                         not make any such communication that references or identifies the Supplying Party without
                                         the prior written consent of the Supplying Party (which consent may be given or withheld
                                         in the Supplying Party’s sole discretion) unless such information is required to
                                         be disclosed by the relevant Governmental Authority.



 




    	

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		c.	Costs of Corrective Actions.
                                         In the event of any Corrective Action, the cause or basis of which is attributable to
                                         a Product being out of compliance with the Specifications, then the Supplying Party shall
                                         reimburse the Receiving Party for the reasonable internal and external costs incurred
                                         by the Receiving Party in undertaking such Corrective Action, to the extent such costs
                                         are attributable to being out of compliance with the Specifications. The costs of all
                                         other Corrective Actions shall be borne by the Receiving Party. For the avoidance of
                                         doubt, the obligations in this section are subject to the limitations on liability set
                                         forth in Section 14(e).



 


		10.	FAILURE TO SUPPLY; FORCE MAJEURE



 


		a.	Force Majeure Events. If
                                         either Party is prevented from performing any of its obligations hereunder due to any
                                         cause which is beyond the non-performing Party’s reasonable control, including
                                         fire, explosion, flood, or other acts of God; acts, regulations, or laws of any government;
                                         war or civil commotion; strike, lock-out or labor disturbances; or failure of public
                                         utilities or common carriers (a “Force Majeure Event”), such non-performing
                                         party shall not be liable for breach of this Agreement with respect to such non-performance
                                         to the extent any such non-performance is due to a Force Majeure Event. Such non-performance
                                         will be excused for thirty days, or as long as such event shall be continuing (whichever
                                         occurs sooner), provided that the non-performing party shall give prompt written notice
                                         to the other party of any Force Majeure Event. Such non-performing party shall exercise
                                         all reasonable efforts to eliminate the Force Majeure Event and to resume performance
                                         of its affected obligations as soon as practicable. During the term of any Force
                                         Majeure Event the Supplying Party shall provide reasonable assistance, including but
                                         not limited to providing licenses, transfer of tooling, or other actions designed to
                                         assist the Receiving Party in covering its needs for Products from third parties.



 


		b.	Failure to Supply. Notwithstanding
                                         the provisions of this Section, in the event that the Supplying Party shall be unable
                                         or unwilling or shall fail to supply any Product in such quantities as the Receiving
                                         Party shall request and in compliance with the delivery periods set forth in its purchase
                                         Orders (whether due to the occurrence of a Force Majeure Event or otherwise (a “Failure
                                         to Supply”), then the Receiving Party shall be permitted (with no obligation
                                         or liability to the Supplying Party) to obtain similar Product from another supplier
                                         and the Supplying Party shall provide such cooperation, assistance and licenses as are
                                         reasonably necessary to assist the Receiving Party in obtaining Products from a third
                                         party.



 




    	

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		11.	REPRESENTATIONS AND WARRANTIES



 


		a.	Warranties. The Supplying
                                         Party warrants to the Receiving Party that the Products (i) shall be manufactured in
                                         compliance with all applicable Laws, rules and regulations, (ii) shall meet the Specifications
                                         at the time of delivery hereunder, and (iii) shall be free from material defects in material
                                         and workmanship, for a period of one (1) year from receipt of Product by the Receiving
                                         Party’s customers, as evidenced by the Receiving Party’s written records;
                                         (iv) prior to delivery to the Receiving Party no repairs have been attempted or parts
                                         replaced by any third party not authorized by Supplier to perform such repair, and that
                                         the Product serial number, date stamp or other identifications or marks (if applicable)
                                         have not been removed or defaced. Warranty claims shall not apply to damaged Product
                                         to the extent such damage is caused in whole or in part by: (A) use, shipping, handling,
                                         installation, operation, maintenance, or storage that is not in accordance with the Supplying
                                         Party’s instructions or that constitutes improper treatment; (B) repair, alteration,
                                         or modifications performed by any party other than the Supplying Party; (C) use of the
                                         Product in any manner or procedure other than those for which it is labeled; or (D) use
                                         of the Product by any person other than trained medical personnel. The foregoing warranties
                                         apply to all Products supplied between the parties, including those supplied prior to
                                         the Effective Date.



 


		b.	Compliant Use. The Receiving
                                         Party represents and warrants to the Supplying Party that it shall only sell and use
                                         the Products in compliance with all applicable rules and regulations, including relating
                                         to design approvals and performance testing requirements in connection with any modifications
                                         to the current Product specifications approved by the Receiving Party. The Receiving
                                         Party shall return to the Supplying Party and shall not sell or use any Product that
                                         it knows to be defective or out of Specification.



 


		12.	INTELLECTUAL PROPERTY. Nothing
                                         in this Agreement shall be construed as abridging or otherwise modifying either Party's
                                         rights, obligations and remedies set forth in the Separation Agreement or the Shared
                                         IP Cross License Agreement.



 


		a.	During the Term, the Receiving
                                         Party hereby grants to the Supplying Party a non-exclusive, royalty-free, worldwide,
                                         non-transferable, non-sublicensable license under the Intellectual Property owned by
                                         such Receiving Party and relating to Products purchased by such Receiving Party under
                                         this Agreement in each case solely to for the Supplying Party to perform its obligations
                                         under this Agreement. Each Party acknowledges and agrees that, except as expressly set
                                         forth in the Agreement, no rights or licenses, express, implied or otherwise, are granted
                                         to either Party by the other Party under this Agreement



 


		b.	Each Party in its capacity as a
                                         Receiving Party acknowledges and agrees that:



 


		i.	any and all of Supplying Party's Intellectual
                                         Property rights are the sole and exclusive property of the Supplying Party or its licensors;



 


		ii.	under this Agreement, the Receiving
                                         Party shall not acquire any ownership interest in any of the Supplying Party's Intellectual
                                         Property; and



 


		iii.	any goodwill derived from the use
                                         by the Receiving Party of the Supplying Party's Intellectual Property rights inures to
                                         the benefit of the Supplying Party or its licensors, as the case may be.



 


		c.	Each Party as the Supplying Party
                                         hereby represents and warrants that:



 


		i.	it owns or has all legal rights and
                                         interest necessary to supply the Products covered by this Agreement; and



 




    	

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		ii.	to its knowledge, the manufacture,
                                         intended use and sale of the Products in accordance with the terms of this Agreement
                                         does not and will not infringe the rights of any third party under any Intellectual Property;



 


		13.	COMPLIANCE. Each Party agrees
                                         to comply with the applicable provisions of any Federal or state law and all executive
                                         orders, rules and regulations issued thereunder, whether now or hereafter in force, including
                                         but not limited to: Executive Order 11246, as amended, Chapter 60 of Title 41 of the
                                         Code of Federal Regulations, as amended, prohibiting discrimination against any employee
                                         or applicant for employment because of race, color, religion, sex or national origin;
                                         Section 60-741.1 of Chapter 60 of 41 Code of Federal Regulations, as amended, prohibiting
                                         discrimination against any employee or applicant for employment because of physical or
                                         mental handicap; Section 60.250.4 of Chapter 60 of 41 Code of Federal Regulations, as
                                         amended, providing for the employment of disabled veterans and veterans of the Vietnam
                                         era; Chapter 1 of Title 48 of the Code of Federal Regulations, as Amended, Federal Acquisition
                                         Regulations; Sections 6, 7 and 12 of the Fair Labor Standards Act, as amended, and the
                                         regulations and orders of the United States Department of Labor promulgated in connection
                                         therewith; and any provisions, representations or agreements required thereby to be included
                                         in this Agreement are hereby incorporated by reference. If any Product is ordered by
                                         the Receiving Party under U.S. federal government contracts, the Supplying Party agrees
                                         that all applicable federal statutes and regulations applying to the Receiving Party
                                         as a contractor or higher-tier subcontractor are accepted and binding upon the Supplying
                                         Party insofar as the Supplying Party may be deemed a subcontractor; provided, however,
                                         that the Receiving Party shall provide to the Supplying Party a list of all Federal Acquisition
                                         Regulation contract clauses that flow through to the Supplying Party under the relevant
                                         government contract. Receiving Party may enter onto and perform Quality Audits (as defined
                                         in the Quality Agreement) for the Supplying Party’s facility relative to the production
                                         or provision of the Products it has ordered hereunder, during regular business hours
                                         and on no less than three (3) business days’ notice.



 


		14.	INDEMNIFICATION



 


		a.	Indemnification by the Supplying
                                         Party. The Supplying Party shall indemnify and hold harmless the Receiving Party
                                         and its Affiliates from and against any and all damages, liabilities, claims, costs,
                                         charges, judgments and expenses including reasonable attorneys’ fees (collectively
                                         “Damages”) sustained, suffered or incurred by the Receiving Party
                                         or its Affiliates, arising from or by reason of (i) the gross negligence or willful misconduct
                                         of the Supplying party or (ii) the breach by the Supplying Party of this Agreement or
                                         any warranty, representation, covenant or agreement made by the Supplying Party in this
                                         Agreement or any claim that any Product purchased from the Supplying Party hereunder
                                         or the use or sale thereof infringes any Intellectual Property of any third party, was
                                         defective or was manufactured or designed negligently; provided, that the Supplying Party
                                         shall not be liable for Damages resulting from: (A) any product liability or personal
                                         injury claims by third parties arising from the sale, distribution or use of any Product
                                         which meets the Specifications, was not designed or manufactured negligently, is not
                                         otherwise defective and does not arise from the Supplying Party’s gross negligence
                                         or willful misconduct, (B) use of the Products in combination with any products, materials
                                         or equipment supplied to the Receiving Party by a Person other than the Supplying Party
                                         or its authorized representatives, or (C) any modifications or changes made to the Products
                                         by or on behalf of any person other than the Supplying Party or its representatives.



 




    	

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		b.	Indemnification by the Receiving
                                         Party. The Receiving Party shall indemnify and hold harmless the Supplying Party
                                         and its Affiliates from and against any and all Damages sustained, suffered or incurred
                                         by the Supplying Party or its Affiliates arising from or by reason of (i) any modifications
                                         or changes made to the Products by or on behalf of any person other than the Supplying
                                         Party or its representatives, (ii) the gross negligence or willful misconduct of the
                                         Receiving Party and (iii) the breach by the Receiving Party of any warranty, representation,
                                         covenant or agreement made by the Receiving Party in this Agreement;



 


		c.	Claims by the Supplying Party.
                                         The Supplying Party agrees to give the Receiving Party prompt written notice of any matter
                                         upon which the Supplying Party intends to base a claim for indemnification (a “Supplying
                                         Party Claim”) under this article. The Receiving Party shall have the right
                                         to participate jointly with the Supplying Party in the Receiving Party’s defense,
                                         settlement or other disposition of any Supplying Party Claim. With respect to any Supplying
                                         Party Claim relating solely to the payment of money damages and which could not result
                                         in the Supplying Party’s becoming subject to injunctive or other equitable relief
                                         or otherwise adversely affect the business of the Supplying Party in any manner, and
                                         as to which the Receiving Party shall have acknowledged in writing the obligation to
                                         indemnify the Supplying Party hereunder, the Receiving Party shall have the sole right
                                         to defend, settle or otherwise dispose of such Supplying Party Claim, on such terms as
                                         the Receiving Party, in its sole discretion, shall deem appropriate; provided that the
                                         Receiving Party shall provide reasonable evidence of its ability to pay any damages claimed
                                         and with respect to any such settlement shall obtain the written release of the Supplying
                                         Party from the Supplying Party Claim. The Receiving Party shall obtain the written consent
                                         of the Supplying Party prior to ceasing to defend, settling or otherwise disposing of
                                         any Supplying Party Claim if as a result thereof the Supplying Party would become subject
                                         to injunctive or other equitable relief or the business of the Supplying Party would
                                         be adversely affected in any manner.



 


		d.	Claims by the Receiving Party.
                                         The Receiving Party agrees to give the Supplying Party prompt written notice of any matter
                                         upon which the Receiving Party intends to base a claim for indemnification (a “Receiving
                                         Party Claim”) under this Article. The Supplying Party shall have the right
                                         to participate jointly with the Receiving Party in the Supplying Party’s defense,
                                         settlement or other disposition of any Receiving Party Claim. With respect to any Receiving
                                         Party Claim relating solely to the payment of money damages and which could not result
                                         in the Receiving Party’s becoming subject to injunctive or other equitable relief
                                         or otherwise adversely affect the business of the Receiving Party in any manner, and
                                         as to which the Supplying Party shall have acknowledged in writing the obligation to
                                         indemnify the Receiving Party hereunder, the Supplying Party shall have the sole right
                                         to defend, settle or otherwise dispose of such Receiving Party Claim, on such terms as
                                         the Supplying Party, in its sole discretion, shall deem appropriate; provided that the
                                         Supplying Party shall provide reasonable evidence of its ability to pay any damages claimed
                                         and with respect to any such settlement shall obtain the written release of the Receiving
                                         Party from the Receiving Party Claim. The Supplying Party shall obtain the written consent
                                         of the Receiving Party prior to ceasing to defend, settling or otherwise disposing of
                                         any Receiving Party Claim if as a result thereof the Receiving Party would become subject
                                         to injunctive or other equitable relief or the business of the Receiving Party would
                                         be adversely affected in any manner.



 




    	

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		e.	Limitations on Liability.
                                         Notwithstanding any provisions of this Agreement to the contrary, under no circumstances
                                         will the Supplying Party’s liability to the Receiving Party under this Agreement,
                                         whether arising from tort (including any form of negligence, recklessness or strict liability),
                                         breach of contract or otherwise, exceed the total amounts actually paid by the Receiving
                                         Party to the Supplying Party in respect of the applicable Product. Under no circumstances
                                         shall either Party be liable for punitive, exemplary or incidental damages, including
                                         but not limited to loss of reputation, or any speculative damages.



 


		15.	MISCELLANEOUS



 


		a.	Dispute Resolution. Any
                                         disputes hereunder, including but not limited to claims for breach or efforts to enforce
                                         this Agreement or any provision hereof shall be resolved pursuant to the dispute resolution
                                         provisions of Article IX of the Separation Agreement.



 


		b.	Confidentiality. The Confidentiality
                                         provisions of Article VIIII of the Shared IP Cross License Agreement shall apply to this
                                         Agreement and the Parties hereto with equal force and effect.



 


		c.	Relationship of the Parties.
                                         The Parties are independent contractors, and nothing contained herein shall be construed
                                         to (i) give either party any right or authority to create or assume any obligation of
                                         any kind on behalf of the other or (ii) constitute the parties as partners, joint venturers,
                                         co-owners or otherwise as participants in a joint or common undertaking.



 


		d.	Entire Agreement. It is
                                         the mutual desire and intent of the parties to provide certainty as to their respective
                                         future rights and remedies against each other by defining the extent of their mutual
                                         undertakings as provided herein. No modification, change or amendment to this Agreement
                                         shall be effective unless in writing signed by each of the parties hereto.



 


		e.	Headings. The Article and
                                         Section headings contained in this Agreement are for reference purposes only and shall
                                         not affect in any way the meaning and interpretation of this Agreement.



 


		f.	Notices. All notices and
                                         other communications hereunder shall be in writing. All notices hereunder of an Indemnity
                                         Claim, a Force Majeure Event, default or breach hereunder, or, if applicable, termination,
                                         or any other notice of any event or development material to this Agreement taken as a
                                         whole, shall be delivered personally, or sent by national overnight delivery service
                                         or postage pre-paid registered or certified U.S. mail, and shall be deemed given: when
                                         delivered, if by personal delivery or overnight delivery service or if so sent by U.S.
                                         mail, three (3) business days after deposit in the mail, and shall be addressed:



 


		If to SpinCo:	3034 Owen Dr.
	 	 	Antioch
TN 30713
	 	 	Attn:
Chief Executive Officer
	 	 	Copy
to: General Counsel






 


		If to Company:	Genstar Capital LLC
	 	 	Four
Embarcadero Center, Suite 1900
	 	 	San
Francisco, CA 94111
	 	 	Attn:
Rob S. Rutledge












 




    	

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or to such
other place as either party may designate by written notice to the other in accordance with the terms hereof.


 


		g.	Failure to Exercise. The
                                         failure of either party to enforce at any time for any period any provision hereof shall
                                         not be construed to be a waiver of such provision or of the right of such party thereafter
                                         to enforce each such provision, nor shall any single or partial exercise of any right
                                         or remedy hereunder preclude any other or further exercise thereof or the exercise of
                                         any other right or remedy. Remedies provided herein are cumulative and not exclusive
                                         of any remedies provided at law.



 


		h.	Assignment. This Agreement
                                         may not be assigned, whether voluntarily or involuntarily, directly or indirectly, by
                                         operation of law, or by a change of control or ownership, by either party without the
                                         prior written consent of the other, except that either Party may assign its rights and/or
                                         obligations hereunder to a third party who acquires substantially all of such Party’s
                                         assets, whether by direct purchase of assets, merger or purchase of the capital stock
                                         of such Party. Subject to the foregoing sentence, this Agreement shall bind and inure
                                         to the benefit of the parties hereto and their respective successors and assigns. Notwithstanding
                                         anything to the contrary contained in this Agreement, the Company may collaterally assign
                                         its rights and remedies under this Agreement to any of its financing sources (including
                                         the Financing Sources (as defined in the Merger Agreement)) without the consent of any
                                         other party.



 


		i.	Severability. In the event
                                         that any one or more of the provisions (or any part thereof) contained in this Agreement
                                         or in any other instrument referred to herein, shall, for any reason, be held to be invalid,
                                         illegal or unenforceable in any respect, then to the maximum extent permitted by law,
                                         such invalidity, illegality or unenforceability shall not affect any other provision
                                         of this Agreement or any other such instrument. Any term or provision of this Agreement
                                         which is invalid, illegal or unenforceable in any jurisdiction shall, to the extent the
                                         economic benefits conferred by this Agreement to both parties remain substantially unimpaired,
                                         not affect the validity, legality or enforceability of any of the terms or provisions
                                         of this Agreement in any other jurisdiction.



 


		j.	Further Assurances. Upon
                                         reasonable request from either Party therefor, the other Party shall promptly provide
                                         to the requesting Party any product samples, manufacturing information and other information
                                         as is necessary for the requesting Party to complete or obtain U.S. or foreign registration
                                         (including reimbursement arrangements) or approval in any territory where the requesting
                                         Party is allowed to sell product or use technology.



 


		k.	Counterparts.  This
                                         Agreement may be executed in one or more counterparts, each of which shall be deemed
                                         an original, but all of which together shall constitute one and the same instrument.



 


		l.	Conflicts. To the extent
                                         of any conflict or inconsistency between this Agreement and any purchase order, confirmation,
                                         acceptance, invoice or any similar document, the terms of this Agreement shall govern.
                                         In the event of a conflict or inconsistency between this Agreement and the Separation
                                         Agreement, the terms of the Separation Agreement shall control.



 




    	

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		m.	Expenses. Each party shall
                                         pay all of its own fees and expenses (including all legal, accounting and other advisory
                                         fees) incurred in connection with the negotiation and execution of this Agreement and
                                         the arrangements contemplated hereby.



 


		n.	Survival. Sections 3(b),
                                         6(c), 7(b), 8(b), 8(c), 9, 11, 14, and
                                         15 and any other provision which, by its terms, should survive termination, shall
                                         survive the termination of this Agreement in accordance with the respective terms thereof.



 


[Signature
Page Follows]


 




    	

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IN WITNESS
WHEREOF, the parties hereto have caused this Agreement to be executed by their duly authorized respective representatives as of
the day and year first above written.


 


	 	SYMMETRY MEDICAL INC.
	 	 
	 	By:	
	 	 	Name: Thomas J. Sullivan
	 	 	Title:   President and Chief Executive Officer
	 	 
	 	RACECAR SPINCO, INC.
	 	 
	 	By:	
	 	 	Name: Thomas J. Sullivan
	 	 	Title:   President


 


[Signature page to Supply Agreement]